Document:

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                                                                    EXHIBIT 4.11

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                                WARRANT AGREEMENT

                                     Between

                          INTEGRATED ORTHOPAEDICS, INC.

                                       And

                   CONTINENTAL STOCK TRANSFER & TRUST COMPANY

                          Dated as of December 19, 2000

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<TABLE>
<S>                                                                                                              <C>
SECTION 1.        Definitions; Accounting Terms and Determinations...............................................1

         1.01.    Definitions....................................................................................1

         1.02.    Accounting Terms and Determinations............................................................4

SECTION 2.        Appointment of Warrant Agent...................................................................4

         2.01.    Appointment of Warrant Agent...................................................................4

SECTION 3.        Issuance of Warrants...........................................................................4

         3.01.    Warrant Certificates...........................................................................4

         3.02.    Registration and Countersignature..............................................................4

SECTION 4.        Execution of Warrant Certificates..............................................................5

SECTION 5.        Registration of Transfers and Exchanges........................................................5

         5.01.    Transfer and Exchange of Warrants..............................................................5

         5.02.    Legends........................................................................................6

         5.03.    Obligations with Respect to Transfers and Exchanges of Warrants................................6

SECTION 6.        Adjustments....................................................................................7

         6.01.    Dividends, Distributions and Purchases.........................................................7

         6.02.    Subdivisions and Combinations..................................................................7

         6.03.    Issuance of Common Stock.......................................................................8

         6.04.    Issuance of other Securities, Rights or Obligation.............................................8

         6.05.    Superseding Adjustment.........................................................................9

         6.06.    Other Provisions Applicable to Adjustments under this Section 6...............................10

         6.07.    Merger, Consolidation or Disposition of Assets................................................10

         6.08.    Other Action Affecting Common Stock...........................................................11

         6.09.    Notices of Adjustments........................................................................11

         6.10.    Notice of Certain Corporate Action............................................................11

SECTION 7.        Holder's Rights...............................................................................12

         7.01.    Taxes.........................................................................................12

         7.02.    Mutilated or Missing Warrant Certificates.....................................................12

SECTION 8.        Other Covenants of Issuer.....................................................................13

         8.01.    Conflicting Agreements........................................................................13

         8.02.    Reservation of Shares.........................................................................13

SECTION 9.        Warrant Agent.................................................................................13

         9.01.    Merger, Consolidation or Change of Name of Warrant Agent......................................13

         9.02.    Warrant Agent's Right and Responsibilities....................................................13
</TABLE>
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<TABLE>
<S>                                                                                                             <C>
         9.03.    Resignation and Removal of Warrant Agent; Appointment of Successor............................15

SECTION 10.       Miscellaneous.................................................................................16

         10.01.   Notices to Issuer and Warrant Agent...........................................................16

         10.02.   Supplements and Amendments....................................................................16

         10.03.   Successors....................................................................................17

         10.04.   Termination...................................................................................17

         10.05.   Governing Law.................................................................................17

         10.06.   Benefits of This Agreement....................................................................17
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                                WARRANT AGREEMENT

         This Warrant Agreement (this "Agreement") is made and entered into as
of December 19, 2000, by and between Integrated Orthopaedics, Inc., a
corporation duly organized and validly existing under the laws of the State of
Texas (the "Issuer"), and Continental Stock Transfer & Trust Company, a New York
corporation, as warrant agent (together with any and all successors appointed in
accordance with this Agreement, the "Warrant Agent").

         WHEREAS, on November 21, 2000 the Board (hereinafter defined) of the
Issuer declared a dividend of warrants to the holders of its Common Stock
(hereinafter defined), whereby each holder of the Common Stock would receive a
warrant to purchase one Stock Unit for each share of Common Stock such holder
owned on December 1, 2000 (the "Record Date"; and each holder of Common Stock on
such date, a "Record Shareholder") on terms more fully set forth in this
Agreement;

         WHEREAS, the Issuer desires the Warrant Agent to act on behalf of the
Issuer, and the Warrant Agent is willing so to act, in connection with the
issuance of the Warrant Certificates (hereinafter defined) and other matters as
provided herein.

         NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth and for the purposes of defining the relative rights
and obligations of the Issuer, the Warrant Agent and the Holders, the parties
hereto, agree as follows:

         SECTION 1. Definitions; Accounting Terms and Determinations.

         1.01. Definitions. As used herein, the following terms shall have the
following meanings (all terms defined in this Section 1 or in other provisions
of this Agreement in the singular to have the same meanings when used in the
plural and vice versa):

         "Affiliate" shall mean, with respect to a specified Person, another
Person that directly, or indirectly through one or more intermediaries, Controls
or is Controlled by or is under common Control with the Person specified.

         "Board" shall mean the Board of Directors of Issuer.

         "Business Day" shall mean any day that is not a Saturday, Sunday or
other day on which commercial banks in the City of New York are authorized or
required by law to remain closed.

         "Commission" shall mean the Securities and Exchange Commission or any
other similar or successor agency of the Federal government administering the
Securities Act and/or the Exchange Act.

         "Common Stock" shall mean the Common Stock of the Issuer, par value
$0.001 per share, or any other common stock or other securities receivable
thereon, or into which the Common Stock is convertible or exchangeable, as a
result of any recapitalization, reclassification, merger or consolidation of, or
disposition of assets by, the Issuer.

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         "Control" shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of a
Person, whether through the ability to exercise voting power, by contract or
otherwise. "Controls" and "Controlled" shall have meanings correlative thereto.

         "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, or any similar Federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time.

         "Excluded Securities" shall mean, collectively, (i) shares of Common
Stock to be issued to the stockholders of PowerBrief in the Merger pursuant to
the terms of the Merger Agreement, (ii) the Merger Warrants, (iii) shares of
Common Stock to be issued upon the exercise of the Merger Warrants, (iv) shares
of Common Stock issued pursuant to Section 2.1(a)(iii) of the Merger Agreement
to adjust the percentage ownership of the Issuer after the Merger among the
pre-Merger shareholders of the Issuer, on the one hand, and the pre-Merger
stockholders of PowerBrief, on the other hand, (v) shares of Common Stock
issuable upon the exercise of any outstanding options or warrants to purchase
Common Stock outstanding on the date of this Agreement, (vi) any shares of
Common Stock issuable upon the exercise of any options or warrants to purchase
common stock of PowerBrief, the obligations of which are assumed by the Issuer
in the Merger pursuant to the Merger Agreement, (vii) the grant of warrants,
options or other rights to purchase, or the sale or issuance of, shares of
Common Stock under any compensatory equity incentive plan, employee benefit plan
or other compensatory plan or agreement (including any such plan or agreement
entered into with any director or consultant) that is approved by the Board,
provided that, such warrants, options or rights to purchase, or the sale or
issuance of, shares of Common Stock, granted or issued within one year after
the effective date of the Merger to Persons that were employees of PowerBrief on
July 31, 2000 shall require unanimous approval of the Board, (viii) any Common
Stock issued upon the exercise or conversion of options, rights or securities
(A) for which an adjustment has already been made pursuant to Section 6.04 or
(B) that otherwise satisfy this definition of Excluded Securities, (ix) a
combination of shares of Common Stock and/or options, rights or securities
convertible into, or exercisable for shares of Common Stock up to an aggregate
amount equal to five percent (5%) of the shares of Common Stock outstanding
immediately after the effective time of the Merger (as adjusted for any stock
split, reverse stock split or other combination resulting in a larger or smaller
number of shares of Common Stock), excluding any shares held in escrow pursuant
to Section 2.17 of the Merger Agreement, issued to Persons with which the Issuer
has business relationships, provided that such issuances described in this
clause (ix) are (A) for strategic purposes, such as advertising, outsourcing or
licensing arrangements with any customer, supplier or other provider of products
or services; (B) not primarily for equity financing purposes and (C) approved by
the Board, (x) Common Stock and/or options, rights or securities convertible
into, or exercisable for, Common Stock, provided that the Board unanimously
approves the issuance of such securities and resolves that such issuance is to
be made without any adjustment in Section 6, and provided that the Board, at the
time of such approval, consists of (A) at least one member of the Board as
constituted immediately before the Merger or (B) at least one member who is an
Affiliate of FW integrated Orthopaedics Investors, L.P. or Integrated
Orthopaedics Investors II, L.P., and (xi) any issuance, to holders of Common
Stock, of Common Stock, or securities that are exercisable or convertible into
or exchangeable for Common Stock, without consideration (a "Without
Consideration Issuance"), if the Holders of the Warrants also receive a number
of shares of Common Stock or a number or amount of such exercisable, convertible
or exchangeable securities that are equal to the number or amount thereof they
would have received had they exercised all of their Warrants for Common Stock
immediately prior to the record date for such Without Consideration Issuance.

         "Exercise Price" shall have the meaning assigned to such term in the
form of Warrant Certificate attached as Annex 1 hereto.

         "Expiration Date" shall have the meaning assigned to such term in the
form of the Warrant Certificate attached as Annex 1 hereto.

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         "GAAP" shall mean generally accepted accounting principles,
consistently applied throughout the specified period.

         "Governmental Authority" shall mean the government of the United States
of America, any other nation or any political subdivision thereof, whether state
or local, and any agency, authority, instrumentality, regulatory body, court,
central bank or other entity exercising executive, legislative, judicial,
taxing, regulatory, monetary or administrative powers or functions of or
pertaining to government.

         "Holder" shall have the meaning assigned to such term in Section
5.03(c).

         "include" and "including" shall be construed as if followed by the
phrase "without being limited to".

         "Issuer" shall have the meaning assigned to such term in the preamble
of this Agreement.

         "Issue Date" shall mean December 19, 2000.

         "Merger" shall mean the merger of PowerBrief with and into the Issuer
pursuant to the Merger Agreement.

         "Merger Agreement" shall mean that certain Agreement and Plan of Merger
dated September 15, 2000 between the Issuer and PowerBrief, as the same may be
amended from time to time.

         "Merger Warrants" shall mean the Issuer's Series A Warrants and Series
B Warrants to be issued to the stockholders and warrant holders of PowerBrief in
the Merger pursuant to the Merger Agreement.

         "Person" shall mean any natural person, corporation, limited liability
company, trust, joint venture, association, company, partnership, Governmental
Authority or other entity.

         "PowerBrief" shall mean PowerBrief, Inc., a Delaware corporation.

         "Record Date" shall have the meaning assigned to such term in the
recitals of this Agreement.

         "Record Shareholders" shall have the meaning assigned to such term in
the recitals of this Agreement.

         "Securities Act" shall mean the Securities Act of 1933, as amended, or
any similar Federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.

         "Stock Unit" shall mean one-half (1/2) of a share of Common Stock, as
such Common Stock is constituted on the date hereof, and thereafter shall mean
such number of shares (including any fractional shares) of Common Stock and
other securities, cash or other property as shall result from the adjustments
specified in Section 6.

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         "Transfer Restricted Securities" shall mean Warrants issued as a
dividend on Common Stock that constitutes "restricted securities" as defined
under Rule 144 promulgated under the Securities Act.

         "Warrant Agent" shall have the meaning assigned to such term in the
preamble of this Agreement.

         "Warrant Certificates" shall have the meaning assigned such term in
Section 3.01.

         "Warrant Stock" shall mean all shares of Common Stock issuable from
time to time upon exercise of a Warrant.

         "Warrants" shall mean the Warrants issued by the Issuer pursuant to
this Agreement, each evidencing a right to purchase one Stock Unit, and all
Warrants issued upon transfer, division or combination of, or in substitution
for, any thereof.

         "Whole Unit" shall mean the aggregate of Stock Units, or portion
thereof, constituting one (1) share of Common Stock.

1.02. Accounting Terms and Determinations. Except as otherwise may be expressly
provided herein, all accounting terms used herein shall be interpreted in
accordance with GAAP. All calculations made for the purposes of determining
compliance with the terms of this Agreement shall (except as otherwise may be
expressly provided herein) be made by application of GAAP.

         SECTION 2. Appointment of Warrant Agent.

         2.01. Appointment of Warrant Agent. The Issuer hereby appoints the
Warrant Agent to act as agent for the Issuer in accordance with the instructions
set forth hereinafter in this Agreement, and the Warrant Agent hereby accepts
such appointment.

         SECTION 3. Issuance of Warrants.

         3.01. Warrant Certificates. Upon request a Holder may receive from the
Warrant Agent a certificate evidencing its Warrants (the "Warrant
Certificates"), substantially in the form of Annex 1 as set forth in Section 5
below.

         3.02. Registration and Countersignature. The Warrant Agent, on behalf
of the Issuer, shall number and register the Warrant Certificates in a register
as they are issued by the Issuer.

         Warrant Certificates shall be manually countersigned by the Warrant
Agent and shall not be valid for any purpose unless so countersigned. The
Warrant Agent shall, upon written instructions of the Chairman of the Board, the
President, the Chief Financial Officer, any Vice President, the Treasurer, or
the Secretary of the Issuer, initially countersign, issue and deliver to each
Record Shareholder one Warrant to purchase one Stock Unit for each share of
Common Stock that such Record Shareholder owned on the Record Date.

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         The Issuer and the Warrant Agent may deem and treat the Holder(s) of
the Warrant Certificates as the absolute owner(s) thereof (notwithstanding any
notation of ownership or other writing thereon made by anyone), for all
purposes, and neither the Issuer nor the Warrant Agent shall be affected by any
notice to the contrary.

         SECTION 4. Execution of Warrant Certificates. The Warrant Certificates
to be delivered pursuant hereto shall be signed on behalf of the Issuer by its
Chairman of the Board, President, Chief Executive Officer, Chief Financial
Officer, any Vice President, Secretary, an Assistant Secretary, Treasurer or an
Assistant Treasurer. Each such signature upon the Warrant Certificates may be in
the form of a facsimile signature of the present or any future Chairman of the
Board, President, Chief Executive Officer, Chief Financial Officer, any Vice
President, Secretary, an Assistant Secretary, Treasurer or an Assistant
Treasurer and may be imprinted or otherwise reproduced on the Warrant
Certificates and for that purpose the Issuer may adopt and use the facsimile
signature of any person who shall have been Chairman of the Board, President,
Chief Executive Officer, Chief Financial Officer, any Vice President, Secretary,
an Assistant Secretary, Treasurer or an Assistant Treasurer, notwithstanding the
fact that at the time the Warrant Certificates shall be countersigned and
delivered or disposed of such person shall have ceased to hold such office.

         In case any officer of the Issuer who shall have signed any of the
Warrant Certificates shall cease to be such officer before the Warrant
Certificates so signed shall have been countersigned by the Warrant Agent, or
disposed of by the Issuer, such Warrant Certificates nevertheless may be
countersigned and delivered or disposed of as though such person had not ceased
to be such officer of the Issuer; and any Warrant Certificate may be signed on
behalf of the Issuer by any person who, at the actual date of the execution of
such Warrant Certificate, shall be a proper officer of the Issuer to sign such
Warrant Certificate, although at the date of the execution of this Agreement any
such person was not such officer.

         Warrant Certificates shall be dated the date of countersignature.

         SECTION 5. Registration of Transfers and Exchanges.

         5.01. Transfer and Exchange of Warrants.

         When Warrant Certificates are presented to the Warrant Agent with a
request:

         (a) to register the transfer of the Warrants represented by such
Warrant Certificates; or

         (b) to exchange such Warrant Certificates for Warrant Certificates
representing an equal number of Warrants of other authorized denominations,
the Warrant Agent shall register the transfer or make the exchange as requested;
provided, however, that the Warrant Certificates presented or surrendered for
registration of transfer or exchange:

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                           (x) shall be duly endorsed or accompanied by a
                  written instruction of transfer in form satisfactory to the
                  Warrant Agent, duly executed by the Holder thereof or by his
                  attorney, duly authorized in writing; and

                           (y) in the case of Transfer Restricted Securities,
                  such request shall be accompanied by the following additional
                  information and documents, as applicable:

                                    (i) if such Transfer Restricted Security is
                           being transferred (1) pursuant to an exemption from
                           registration in accordance with Rule 144 under the
                           Securities Act (and based on an opinion of counsel if
                           the Issuer so requests) or (2) pursuant to an
                           effective registration statement under the Securities
                           Act, a certification to that effect (in substantially
                           the form of Annex 2 hereto); or

                                    (ii) if such Transfer Restricted Security is
                           being transferred in reliance on another exemption
                           from the registration requirements of the Securities
                           Act (and based on an opinion of counsel if the Issuer
                           so requests), a certification to that effect (in
                           substantially the form of Annex 2 hereto).

         5.02. Legends.

         (a) Each Warrant Certificate evidencing a Transfer Restricted Security
(and all Warrant Certificates issued in exchange therefor or substitution
thereof) shall bear a legend in substantially the following form:

         "THE WARRANTS REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES
         LAWS. THE WARRANTS MAY NOT BE OFFERED FOR SALE, SOLD, PLEDGED,
         TRANSFERRED, OR OTHERWISE DISPOSED OF UNTIL THE HOLDER HEREOF PROVIDES
         EVIDENCE SATISFACTORY TO THE ISSUE WHICH, IN THE DISCRETION OF THE
         ISSUER, MAY INCLUDE AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER
         THAT SUCH OFFER, SALE, PLEDGE, TRANSFER, OR OTHER DISPOSITION WILL NOT
         VIOLATE APPLICABLE FEDERAL OR STATE SECURITIES LAWS."

         (b) Upon any sale or transfer of a Transfer Restricted Security
pursuant to an effective registration statement under the Securities Act,
pursuant to Rule 144 under the Securities Act or pursuant to an opinion of
counsel reasonably satisfactory to the Company that no legend is required, the
Warrant Agent shall permit the Holder thereof to exchange the Warrant
Certificate representing such Transfer Restricted Security for a Warrant
Certificate that does not bear the legend set forth in clause (a) above and
rescind any restriction on the transfer of such Transfer Restricted Securities.

         5.03. Obligations with Respect to Transfers and Exchanges of Warrants.

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         (a) To permit registrations of transfers and exchanges, the Issuer
shall execute and the Warrant Agent is hereby authorized to countersign, in
accordance with the provisions of Sections 3 and 4, Warrant Certificates as
required pursuant to the provisions of this Section 5.

         (b) All Warrant Certificates issued upon any registration of transfer
or exchange of Warrant Certificates shall be the valid obligations of the
Issuer, entitled to the same benefits under this Agreement as the Warrant
Certificates surrendered upon such registration of transfer or exchange.

         (c) Prior to due presentment for registration of transfer or exchange
of any Warrant Certificate, the Warrant Agent and the Issuer may deem and treat
the Person in whose name any Warrant Certificate is registered (the "Holder") as
the absolute owner of the Warrants represented by such Warrant Certificate and
neither the Warrant Agent, nor the Issuer shall be affected by notice to the
contrary.

         (d) No service charge shall be made to a Holder for any registration,
transfer or exchange.

         SECTION 6. Adjustments.

         6.01. Dividends, Distributions and Purchases.

         (a) If the Issuer shall pay or distribute during any calendar quarter
any cash dividend to holders of its Common Stock in excess of 0.75 % of the
market price of its Common Stock immediately prior to the declaration of such
dividend, then the aggregate Exercise Price for a Whole Unit shall be adjusted
downward by the per share amount of such dividend; and

         (b) If at any time the Issuer shall pay any dividend or make any other
distribution to holders of its Common Stock of any evidence of indebtedness or
other property of any nature whatsoever (other than as provided in Sections
6.01(a), 6.02, 6.03(i)(A) and 6.04(i)(A) (which such Section 6.04 (i)(A) shall
include any dividend by the Issuer of rights to purchase its equity
securities)), the Issuer shall at the same time pay or distribute to each Holder
of Warrants that is by their terms then exercisable (whether or not such Holder
exercises such Warrants) the evidence of indebtedness or other property such
Holder would have been entitled to receive if, such Holder had exercised such
Warrants immediately prior to the record date for such dividend or distribution.

         6.02. Subdivisions and Combinations. If at any time the Issuer shall:

         (a) take a record of the holders of its Common Stock for the purpose of
entitling them to receive a dividend or other distribution of Common Stock;

         (b) subdivide, split or reclassify its outstanding shares of Common
Stock into a larger number of shares of Common Stock; or

         (c) combine its outstanding shares of Common Stock into a smaller
number of shares of Common Stock;

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then immediately after the occurrence of any such event the number of shares of
Warrant Stock comprising a Stock Unit shall be adjusted so that each Holder
would receive upon exercise of its Warrants the number of shares of Warrant
Stock that such Holder would have been entitled to receive if such Holder had
exercised its Warrants immediately prior to the occurrence of such event.

         6.03. Issuance of Common Stock. In case at any time the Issuer (i)(A)
shall take a record of the holders of its Common Stock for the purpose of
entitling them to subscribe for or purchase shares of any class or series of
Common Stock or (B) shall otherwise sell or issue such securities and (ii) the
consideration per share of Common Stock to be paid upon such issuance or
subscription is less than aggregate Exercise Price for a Whole Unit on such
record date, then the Exercise Price shall be adjusted to be that price
determined by dividing (i) an amount equal to the sum of (A) the product of (1)
the number of shares of Common Stock outstanding immediately before such
issuance, distribution, subscription or purchase and (2) the then existing
aggregate Exercise Price for a Whole Unit plus (B) the aggregate consideration,
if any, received by the Issuer upon such issuance for the total number of shares
of Common Stock to be issued, distributed, subscribed for or purchased, by (ii)
the total number of shares of Common Stock outstanding immediately after such
issuance, distribution, subscription or purchase; provided, however, this
Section 6.03 shall not apply to the issuance of Excluded Securities.

Aggregate consideration for purposes of this Section 6.03 shall be determined as
follows: In case any shares of Common Stock shall be issued or sold for cash,
the consideration received therefor shall be deemed to be the amount payable to
the Issuer therefor, after deduction therefrom of any expenses incurred or any
underwriting commissions or concessions or discounts or, in the case of a
private placement thereof, finders' fees or commissions paid or allowed by the
Issuer in connection therewith. In case any shares of Common Stock shall be
issued or sold for a consideration other than cash payable to the Issuer, the
consideration received therefor shall be deemed to be the fair value of such
consideration as determined by the Board, after deduction therefrom of any
expenses incurred or any underwriting commissions or concessions or discounts
paid or allowed by the Issuer in connection therewith. In case any shares of
Common Stock shall be issued in connection with any merger of another
corporation into the Issuer, the amount of consideration therefor shall be
deemed to be the fair value as determined by the Board of such portion of the
assets of such merged corporation as the Board shall determine to be
attributable to such shares of Common Stock.

         6.04. Issuance of other Securities, Rights or Obligation. In case at
any time the Issuer (i)(A) shall take a record of the holders of its Common
Stock for the purpose of entitling them to subscribe for or purchase options to
purchase or rights to subscribe for Common Stock or securities directly or
indirectly convertible into or exchangeable for Common Stock (or options or
rights with respect to such securities) or (B) shall otherwise issue or sell any
such options, rights or securities and (ii) the consideration per share for
which Common Stock is deliverable upon exercise of such options or rights or
conversion or exchange of such securities (determined by dividing (x) the total
amount received or receivable by the Issuer in consideration of the issuance of
or subscription for such options, rights or securities, plus the minimum
aggregate amount of premiums (if any) payable to the Issuer upon such exercise,
conversion or exchange, by (y) the total maximum number of shares of Common
Stock necessary to effect the exercise,

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conversion or exchange of all such options, rights or securities) shall be less
than the aggregate Exercise Price for a Whole Unit on such record date or sale
or issuance date, as the case may be, then the number of shares of Warrant Stock
comprising a Stock Unit shall be adjusted to be that number determined by
multiplying the number of shares of Warrant Stock comprising a Stock Unit
immediately prior to such date by a fraction (not to be less than one) (i) the
numerator of which shall be equal to the product of (A) the total maximum number
of shares of Common Stock outstanding after giving effect to the assumed
exercise or conversion of all such options, rights or securities and (B) the
aggregate Exercise Price for a Whole Unit determined immediately before such
date and (ii) the denominator of which shall be equal to the sum of (A) the
product of (1) the number of shares of Common Stock outstanding immediately
before such date and (2) the aggregate Exercise Price for a Whole Unit
determined immediately before such date and (B) the aggregate consideration
(determined as set forth in subsection (ii)(x) and (y) above) for which Common
Stock is deliverable upon exercise, conversion or exchange of such options,
rights or securities; provided, however, that this Section 6.04 shall not apply
to the issuance of Excluded Securities. Aggregate consideration for purposes of
the immediately preceding clause (B) shall be determined as follows: In case any
options, rights or convertible or exchangeable securities (or options or rights
with respect thereto) shall be issued or sold, or exercisable, convertible or
exchangeable for cash, the consideration received therefor shall be deemed to be
the amount payable to the Issuer (determined as set forth in subsection (ii)(x)
and (y) above) therefor, after deduction therefrom of any expense incurred or
any underwriting commissions or concessions or discounts or, in the case of a
private placement thereof, finders' fees or commissions paid or allowed by the
Issuer in connection therewith. In case any such options, rights or securities
shall be issued or sold, or exercisable, convertible or exchangeable for a
consideration other than cash payable to the Issuer, the consideration received
therefor (determined as set forth in subsection (ii)(x) and (y) above) shall be
deemed to be the fair value of such consideration as determined by the Board,
after deduction therefrom of any expenses incurred or any underwriting
commissions or concessions or discounts paid or allowed by the Issuer in
connection therewith. In case any such options, rights or securities shall be
issued or sold, or exercisable, convertible or exchangeable in connection with
any merger of another corporation into the Issuer, the amount of consideration
therefor shall be deemed to be the fair value as determined by the Board of such
portion of the assets of such merged corporation as the Board shall determine to
be attributable to such options, rights or securities.

         6.05. Superseding Adjustment. If, at any time after any adjustment in
the number of shares of Warrant Stock comprising a Stock Unit shall have been
made on the basis of the issuance of any options or rights, or convertible or
exchangeable securities (or options or rights with respect to such securities)
pursuant to Section 6.04 hereof:

               (a) the options or rights shall expire prior to exercise or the
right to convert or exchange any such securities shall terminate; or

               (b) the consideration per share for which shares of Common Stock
are issuable pursuant to the terms of such options or rights or convertible or
exchangeable securities shall be increased or decreased, other than under or by
reason of provisions designed to protect against dilution;

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<PAGE>   13

such previous adjustment shall be rescinded and annulled. Thereupon, a
recomputation shall be made of the effect of such options or rights or
convertible or exchangeable securities with respect to shares of Common Stock on
the basis of

         (A)   treating the number of shares of Common Stock, if any,
               theretofore actually issued or issuable pursuant to the previous
               exercise, conversion or exchange of such options, rights or
               securities as having been issued on the date or dates of such
               exercise, conversion or exchange and for the consideration
               actually received and receivable therefore, and

         (B)   treating any such options, rights or securities which then remain
               outstanding as having been granted or issued immediately after
               the time of such increase or decrease for the consideration per
               share for which shares of Common Stock are issuable upon
               exercise, conversion or exchange of such options, rights or
               securities.

To the extent called for by the foregoing provisions of this Section 6.05 on the
basis aforesaid, a new adjustment in the number of shares of Warrant Stock
comprising a Stock Unit shall be made, determined using the Exercise Price used
at the time of the original determination, which new adjustment shall supersede
the previous adjustment so rescinded and annulled. If the exercise, conversion
or exchange price provided for in any such option, right or security shall
decrease at any time under or by reason of provisions designed to protect
against dilution, then in the case of the delivery of shares of Common Stock
upon the exercise, conversion or exchange of any such option, right or security,
the Stock Unit purchasable upon the exercise of a Warrant shall forthwith be
adjusted in the manner which would have obtained had the adjustment made upon
issuance of such option, right or security been made upon the basis of the
issuance of (and the aggregate consideration received for) the shares of Common
Stock delivered as aforesaid.

         6.06. Other Provisions Applicable to Adjustments under this Section 6.
The following provisions shall be applicable to the making of adjustments of the
number of shares of Warrant Stock comprising a Stock Unit:

               (a) The sale or other disposition of any issued shares of Common
Stock owned or held by or for the account of the Issuer shall be deemed to be an
issuance thereof for purpose of this Section 6.

               (b) In computing adjustments under this Section 6, fractional
interest in Common Stock shall be taken into account to the nearest
one-thousandth of a share.

               (c) If the Issuer shall take a record of the holders of its
Common Stock for the purpose of entitling them to receive a dividend or
distribution or subscription or purchase rights and shall, thereafter and before
the distribution thereof, legally abandon its plan to pay or deliver such
dividend, distribution, subscription or purchase rights, then thereafter no
adjustment shall be required by reason of the taking of such record and any such
adjustment previously made in respect thereof shall be rescinded, and annulled.

         6.07. Merger, Consolidation or Disposition of Assets. If the Issuer
shall merge or consolidate with another corporation, or shall sell, transfer or
otherwise dispose of all or

                                       10
<PAGE>   14

substantially all of its assets to another corporation and pursuant to the terms
of such merger, consolidation or disposition of assets, cash, shares of common
stock or other securities of the successor or acquiring corporation, or property
of any nature is to be received by or distributed to the holders of Common Stock
of the Issuer, then each Holder of Warrants that are by their terms then
exercisable shall, at such Holder's election, have the right to receive (whether
or not such Holder exercises such Warrants) the amount it would have been
entitled to receive if the Holder had exercised such Warrants immediately prior
to the occurrence of such merger, consolidation or disposition of assets, net of
the Exercise Price of such Warrants, and shall thereupon be deemed to have
exercised such Warrants. In case of any such merger, consolidation or
disposition of assets in which the foregoing election is not made, the successor
or acquiring corporation (and any affiliate thereof issuing securities) shall
expressly assume the due and punctual observance and performance of each and
every covenant and condition of the Warrants to be performed and observed by the
Issuer and all of the obligations and liabilities hereunder, subject to such
modifications as may be deemed appropriate (as determined by resolution of the
Board) in order to provide for adjustments of Stock Units which shall be as
nearly equivalent as practicable to the adjustments provided for in this
Section. The foregoing provisions shall similarly apply to successive mergers,
consolidations and dispositions of assets.

         6.08. Other Action Affecting Common Stock. If at any time or from time
to time the Issuer shall take any action affecting its Common Stock, other than
an action described in any of the foregoing subsections of this Section 6 or an
action taken in the ordinary course of the Issuer's business and consistent with
past practice, then, unless in the reasonable opinion of the Board such action
will not have a material adverse effect upon the rights of the Holder of the
Warrants, the terms of the Warrants shall be adjusted in such manner and at such
time as the Board shall in good faith determine to be equitable in the
circumstances, but no such adjustment shall decrease the number of shares of
Warrant Stock comprising a Stock Unit.

         6.09. Notices of Adjustments. Upon any adjustment of the Exercise Price
pursuant to this Section 6, the Issuer shall promptly thereafter (i) cause to be
filed with the Warrant Agent a certificate of the chief accounting officer of
the Issuer setting forth the Exercise Price after such adjustment and setting
forth in reasonable detail the method of calculation and the facts upon which
such calculations are based and setting forth the number of shares of Warrant
Stock (or portion thereof) comprising a Stock Unit and issuable after such
adjustment in the Exercise Price, upon exercise of a Warrant and payment of the
adjusted Exercise Price, which certificate shall be conclusive evidence of the
correctness of the matters set forth therein, and (ii) cause to be given to each
of the registered Holders of the Warrant Certificates at his address appearing
on the Warrant register written notice of such adjustments by first-class mail,
postage prepaid. The Warrant Agent shall be entitled to rely on the
above-referenced officer's certificate and shall be under no duty or
responsibility with respect to any such certificate, except to exhibit the same
from time to time to any Holder desiring an inspection thereof during reasonable
business hours. The Warrant Agent shall not at any time be under any duty or
responsibility to any Holder to determine whether any facts exist that may
require any adjustment of the number of shares of Common Stock or other stock or
property issuable on exercise of the Warrants or the Exercise Price, or with
respect to the nature or extent of any such adjustment when made, or with
respect to the method employed in making such adjustment or the validity or
value (or the kind or amount) of any shares of Common Stock or other stock or
property which may be issuable on

                                       11
<PAGE>   15

exercise of the Warrants. The Warrant Agent shall not be responsible for any
failure of the Issuer to make any cash payment or to issue, transfer or deliver
any shares of Common Stock or stock certificates or other common stock or
property upon the exercise of any Warrant.

         6.10. Notice of Certain Corporate Action. If the Issuer shall propose
(i) to pay any dividend to the holders of its Common Stock or to make any other
distribution to the holders of its Common Stock; (ii) to offer to the holders of
its Common Stock rights to subscribe for or to purchase any additional shares of
Common Stock (or options or rights with respect thereto); (iii) to effect any
reclassification of its Common Stock; (iv) to otherwise issue any Common Stock
or other securities, excluding the issuance, conversion, exercise or exchange of
Excluded Securities; (v) to effect any capital reorganization, excluding the
issuance, conversion, exercise or exchange of Excluded Securities; (vi) to
effect any consolidation, merger or sale, transfer or other disposition of all
or substantially all of its assets; or (vii) to effect the liquidation,
dissolution or winding up of the Issuer, then, in each such case, the Issuer
shall cause to be filed with the Warrant Agent and shall cause to be given to
each Holder of the Warrant Certificates at such Holder's address appearing on
the Warrant register by first-class mail, postage prepaid a notice of such
proposed action, which shall specify the date on which a record is to be taken
for the purposes of such dividend, distribution or right offer, or the date on
which such reclassification, issuance, reorganization, consolidation, merger,
sale, transfer, disposition, liquidation, dissolution or winding up is to take
place and the date of participation therein by the holders of Common Stock, if
any such date is to be fixed, and shall also set forth such facts with respect
thereto as shall be reasonably necessary to indicate the effect of such action
on the Common Stock, and the number of shares of Warrant Stock which will
comprise a Stock Unit after giving effect to any adjustment which will be
required as a result of such action. Such notice shall be so mailed in the case
of any action covered by clause (i) or (ii) above at least 10 days prior to the
record date for determining holders of the Common Stock for purposes of such
action, and in the case of any other such action, at least 20 days prior to the
date of the taking of such proposed action or the date of participation therein
by the holders of Common Stock, whichever shall be the earlier.

         SECTION 7. Holder's Rights.

         7.01. Taxes. The Issuer shall pay all taxes (other than Federal, state
or local income taxes) which may be payable in connection with the execution and
delivery of this Agreement or the issuance of the Warrants and Warrant Stock
hereunder or in connection with any modification of this Agreement or the
Warrant and shall hold the Holder harmless without limitation as to time against
any and all liabilities with respect to all such taxes. The obligations of the
Issuer under this Section 7.01 shall survive any redemption, repurchase or
acquisition of any Warrant or Warrant Stock by the Issuer, any termination of
this Agreement, and any cancellation or termination of any Warrant.

         7.02. Mutilated or Missing Warrant Certificates. In case any of the
Warrant Certificates shall be mutilated, lost, stolen or destroyed, the Issuer
may in its discretion issue and the Warrant Agent may countersign, in exchange
and substitution for and upon cancellation of the mutilated Warrant Certificate,
or in lieu of and substitution for the Warrant Certificate lost, stolen or
destroyed, a new Warrant Certificate of like tenor and representing an
equivalent number of Warrants, but only upon receipt of evidence reasonably
satisfactory to the Issuer and

                                       12
<PAGE>   16

the Warrant Agent of such loss, theft or destruction of such Warrant Certificate
and indemnity, if requested, also reasonably satisfactory to them. Applicants
for such substitute Warrant Certificates shall also comply with such other
reasonable regulations and pay such other reasonable charges as the Issuer or
the Warrant Agent may prescribe.

         SECTION 8. Other Covenants of Issuer.

         8.01. Conflicting Agreements. So long as any of the Warrants shall be
outstanding, the Issuer shall not at any time enter into an agreement or other
instrument limiting in any manner its ability to perform its obligations under
this Agreement or the Warrants, or making such performance or the issuance of
Warrant Stock upon the exercise of any Warrant a default under any such
agreement or instrument.

         8.02. Reservation of Shares. The Issuer shall at times that any
Warrants are outstanding, maintain a reserve of a sufficient number of shares of
Warrant Stock for issuance upon the exercise of such Warrants.

         SECTION 9. Warrant Agent.

         9.01. Merger, Consolidation or Change of Name of Warrant Agent. Any
corporation into which the Warrant Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or consolidation to
which the Warrant Agent shall be a party, or any corporation succeeding to the
business of the Warrant Agent, shall be the successor to the Warrant Agent
hereunder without the execution or filing of any paper or any further act on the
part of any of the parties hereto, provided that such corporation would be
eligible for appointment as a successor warrant agent under the provisions of
Section 9.03. Any such successor Warrant Agent shall promptly cause notice of
its succession as Warrant Agent to be mailed (by first class mail, postage
prepaid) to each Holder at such Holder's last address as shown on the register
maintained by the Warrant Agent pursuant to this Agreement. In case at the time
such successor to the Warrant Agent shall succeed to the agency created by this
Agreement, and in case at that time any of the Warrant Certificates shall have
been countersigned but not delivered, any such successor to the Warrant Agent
may adopt the countersignature of the original Warrant Agent; and in case at
that time any of the Warrant Certificates shall not have been countersigned, any
successor to the Warrant Agent may countersign such Warrant Certificates either
in the name of the predecessor Warrant Agent or in the name of the successor to
the Warrant Agent; and in all such cases such Warrant Certificates shall have
the full force and effect provided in the Warrant Certificates and in this
Agreement.

         In case at any time the name of the Warrant Agent shall be changed and
at such time any of the Warrant Certificates shall have been countersigned but
not delivered, the Warrant Agent whose name has been changed may adopt the
countersignature under its prior name, and in case at that time any of the
Warrant Certificates shall not have been countersigned, the Warrant Agent may
countersign such Warrant Certificates either in its prior name or in its changed
name, and in all such cases such Warrant Certificates shall have the full force
and effect provided in the Warrant Certificates and in this Agreement.

                                       13
<PAGE>   17

         9.02. Warrant Agent's Right and Responsibilities. The Warrant Agent
undertakes the duties and obligations imposed by this Agreement upon the
following terms and conditions, by all of which the Issuer and the Holders of
Warrants, by their acceptance thereof, shall be bound:

               (a) The statements contained herein and in the Warrant
Certificates shall be taken as statements of the Issuer and the Warrant Agent
assumes no responsibility for the correctness of any of the same except such as
describe the Warrant Agent or action taken or to be taken by it. The Warrant
Agent assumes no responsibility with respect to the distribution of the Warrant
Certificates except as herein otherwise provided.

               (b) The Warrant Agent shall not be responsible for any failure of
the Issuer to comply with any of the covenants contained in this Agreement or in
the Warrant Certificates to be complied with by the Issuer.

         The Warrant Agent may consult at any time with counsel satisfactory to
it (who may be counsel for the Issuer) and the Warrant Agent shall incur no
liability or responsibility to the Issuer or to any Holder of any Warrant
Certificate in respect of any action taken, suffered or omitted by it hereunder
in good faith and in accordance with the opinion or the advice of such counsel.

         The Warrant Agent shall incur no liability or responsibility to the
Issuer or to any Holder of any Warrant Certificate for any action taken in
reliance on any Warrant Certificate, certificate of shares, notice, resolution,
waiver, consent, order, certificate, or other paper, document or instrument
believed by it to be genuine and to have been signed, sent or presented by the
proper party or parties.

         The Issuer agrees to pay to the Warrant Agent such compensation for all
services rendered by the Warrant Agent in the execution of this Agreement as the
parties shall agree from time to time, to reimburse the Warrant Agent for all
expenses, taxes and governmental charges and other charges of any kind and
nature reasonably incurred by the Warrant Agent in the execution of this
Agreement and to indemnify the Warrant Agent and save it harmless against any
and all liabilities, including judgments, costs and counsel fees, for anything
done or omitted by the Warrant Agent in the execution of this Agreement except
as a result of its gross negligence or willful misconduct.

         The Warrant Agent shall be under no obligation to institute any action,
suit or legal proceeding or to take any other action likely to involve expense
unless the Issuer or one or more Holders of Warrant Certificates shall furnish
the Warrant Agent with security and indemnity satisfactory to the Warrant Agent
for any costs and expenses which may be incurred, but this provision shall not
affect the power of the Warrant Agent to take such action as it may consider
proper, whether with or without any such security or indemnity. All rights of
action under this Agreement or under any of the Warrants may be enforced by the
Warrant Agent without the possession of any of the Warrant Certificates or the
production thereof at any trial or other proceeding relative thereto, and any
such action, suit or proceeding instituted by the Warrant Agent shall be brought
in its name as Warrant Agent and any recovery of judgment shall be for the
ratable benefit of the Holders of the Warrants, as their respective rights or
interests may

                                       14
<PAGE>   18

appear. No provision of this Agreement shall require the Warrant Agent to expend
or risk its own funds.

         The Warrant Agent, and any stockholder, director, officer or employee
of it, may buy, sell or deal in any of the Warrants or other securities of the
Issuer or become pecuniarily interested in any transaction in which the Issuer
may be interested, or contract with or lend money to the Issuer or otherwise act
as fully and freely as though it were not Warrant Agent under this Agreement.
Nothing herein shall preclude the Warrant Agent from acting in any other
capacity for the Issuer or for any other legal entity.

         The Warrant Agent shall act hereunder solely as agent for the Issuer,
and its duties shall be determined solely by the provisions hereof. The Warrant
Agent shall not be liable for anything which it may do or refrain from doing in
connection with this Agreement except for its own gross negligence or willful
misconduct.

         The Warrant Agent shall not at any time be under any duty or
responsibility to any Holder of any Warrant Certificate to make or cause to be
made any adjustment of the Exercise Price or number of the Warrant Shares or
other securities or property deliverable as provided in this Agreement, or to
determine whether any facts exist which may require any of such adjustments, or
with respect to the nature or extent of any such adjustments, when made, or with
respect to the method employed in making the same. The Warrant Agent shall not
be accountable with respect to the validity or value or the kind or amount of
any Warrant Shares or of any securities or property which may at any time be
issued or delivered upon the exercise of any Warrant or with respect to whether
any such Warrant Shares or other securities will when issued be validly issued
and fully paid and nonassessable and makes no representation with respect
thereto.

         9.03. Resignation and Removal of Warrant Agent; Appointment of
Successor. No resignation or removal of the Warrant Agent and no appointment of
a successor warrant agent shall become effective until the acceptance of
appointment by the successor warrant agent as provided herein. The Warrant Agent
may resign its duties and be discharged from all further duties and liability
hereunder (except liability arising as a result of the Warrant Agent's own gross
negligence or willful misconduct) after giving written notice to the Issuer. The
Issuer may remove the Warrant Agent upon written notice, and the Warrant Agent
shall thereupon in like manner be discharged from all further duties and
liabilities hereunder, except as aforesaid. The Warrant Agent shall, at the
Issuer's expense, cause to be mailed (by first class mail, postage prepaid) to
each Holder of a Warrant at such Holder's last address as shown on the register
of the Issuer maintained by the Warrant Agent a copy of said notice of
resignation or notice of removal, as the case may be. Upon such resignation or
removal, the Issuer shall appoint in writing a new warrant agent. If the Issuer
shall fail to make such appointment within a period of 30 days after it has been
notified in writing of such resignation by the resigning Warrant Agent or after
such removal, then the resigning Warrant Agent or the Holder of any Warrant may
apply to any court of competent jurisdiction for the appointment of a new
warrant agent. Any new warrant agent, whether appointed by the Issuer or by such
a court, shall be a corporation doing business under the laws of the United
States or any state thereof, in good standing and having a combined capital and
surplus of not less than $50,000,000. The combined capital and surplus of any
such new warrant agent shall be deemed to be the combined capital and surplus as
set forth in the

                                       15
<PAGE>   19

most recent annual report of its condition published by such warrant agent prior
to its appointment, provided that such reports are published at least annually
pursuant to law or to the requirements of a federal or state supervising or
examining authority. After acceptance in writing of such appointment by the new
warrant agent, it shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named herein as the Warrant Agent,
without any further assurance, conveyance, act or deed; but if for any reason it
shall be necessary or expedient to execute and deliver any further assurance,
conveyance, act or deed, the same shall be done at the expense of the Issuer and
shall be legally and validly executed and delivered by the resigning or removed
Warrant Agent. Not later than the effective date of any such appointment, the
Issuer shall give notice thereof to the resigning or removed Warrant Agent.
Failure to give any notice provided for in this Section 9.03, however, or any
defect therein, shall not affect the legality or validity of the resignation of
the Warrant Agent or the appointment of a new warrant agent, as the case may be.

         SECTION 10. Miscellaneous.

         10.01. Notices to Issuer and Warrant Agent. Any notice or demand
authorized by this Agreement to be given or made by the Warrant Agent or by the
Holder of any Warrant Certificate to or on the Issuer shall be sufficiently
given or made when and if deposited in the mail, first class or registered,
postage prepaid, addressed (until another address is filed in writing by the
Issuer with the Warrant Agent), as follows:

                           Integrated Orthopedics, Inc.
                           5858 Westheimer, Suite 500
                           Houston, Texas 77057
                           Attention: Chief Executive Officer
                           Telecopy:  (713) 526-4600
                           Telephone: (713) 586-4790

                                       16
<PAGE>   20

         In case the Issuer shall fail to maintain such office or agency or
shall fail to give such notice of the location or of any change in the location
thereof, presentations may be made and notices and demands may be served at the
principal office of the Warrant Agent.

         Any notice pursuant to this Agreement to be given by the Issuer or by
the Holder(s) of any Warrant Certificate to the Warrant Agent shall be
sufficiently given when and if deposited in the mail, first-class or registered,
postage prepaid, addressed (until another address is filed in writing by the
Warrant Agent with the Issuer) to the Warrant Agent as follows:

                  Continental Stock Transfer & Trust Company
                  2 Broadway
                  New York, New York 10004
                  Telecopy:  (212) 509-4000
                  Attention: Compliance Department

         10.02. Supplements and Amendments. The Issuer and the Warrant Agent may
from time to time supplement or amend this Agreement without the approval of any
Holders of Warrant Certificates in order to cure any ambiguity or to correct or
supplement any provision contained herein which may be defective or inconsistent
with any other provision herein, or to make any other provisions in regard to
matters or questions arising hereunder which the Issuer and the Warrant Agent
may deem necessary or desirable and which shall not in any way adversely affect
the interests of the Holders of Warrant Certificates. Any amendment or
supplement to this Agreement that has a material adverse effect on the interests
of Holders shall require the written consent of Holders representing a majority
of the then outstanding Warrants. The consent of each Holder of a Warrant
affected shall be required for any amendment pursuant to which the Exercise
Price would be increased or the number of Warrant Shares purchasable upon
exercise of Warrants would be decreased (other than pursuant to adjustments
provided for in Section 6 hereof or amendments to Section 6 which can be made by
the written consent of Holders representing a majority of the then outstanding
Warrants). The Warrant Agent shall be entitled to receive and, subject to
Section 9.02, shall be fully protected in relying upon, an officers' certificate
and opinion of counsel as conclusive evidence that any such amendment or
supplement is authorized or permitted hereunder, that it is not inconsistent
herewith, and that it will be valid and binding upon the Issuer in accordance
with its terms.

         10.03. Successors. All the covenants and provisions of this Agreement
by or for the benefit of the Issuer or the Warrant Agent shall bind and inure to
the benefit of their respective successors and assigns hereunder.

         10.04. Termination. This Agreement (other than any party's obligations
with respect to Warrants previously exercised and with respect to
indemnification under Section 9.02) shall terminate at 5:00 p.m., New York City
time on the Expiration Date.

                                       17
<PAGE>   21

         10.05. Governing Law. THIS AGREEMENT AND EACH WARRANT CERTIFICATE
ISSUED HEREUNDER SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE
STATE OF TEXAS AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS OF SAID STATE, WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS
PROVISIONS THEREOF.

         10.06. Benefits of This Agreement.

               (a) Nothing in this Agreement shall be construed to give to any
Person other than the Issuer, the Warrant Agent and the Holders of the Warrant
Certificates any legal or equitable right, remedy or claim under this Agreement;
but this Agreement shall be for the sole and exclusive benefit of the Issuer,
the Warrant Agent and the Holders of the Warrant Certificates.

               (b) Prior to the exercise of the Warrants, no Holder of a Warrant
Certificate, as such, shall be entitled to any rights of a stockholder of the
Issuer, including, without limitation, the right to receive dividends or
subscription rights, the right to vote, to consent, to exercise any preemptive
right, to receive any notice of meetings of stockholders for the election of
directors of the Issuer or any other matter or to receive any notice of any
proceedings of the Issuer, except as may be specifically provided for herein.
The Holders of the Warrants are not entitled to share in the assets of the
Issuer in the event of the liquidation, dissolution or winding up of the
Issuer's affairs.

               (c) All rights of action in respect of this Agreement are vested
in the Holders of the Warrants, and any Holder of any Warrant, without the
consent of the Warrant Agent or the Holder of any other Warrant, may, on such
Holder's own behalf and for such Holder's own benefit, enforce, and may
institute and maintain any suit, action or proceeding against the Issuer
suitable to enforce, or otherwise in respect of, such Holder's rights hereunder,
including the right to exercise, exchange or surrender for purchase such
Holder's Warrants in the manner provided in this Agreement.

                  [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

                                       18
<PAGE>   22
         IN WITNESS WHEREOF, the parties hereto have duly executed this Warrant
Agreement as of the date first above written.

                                     ISSUER:

                                     INTEGRATED ORTHOPAEDICS, INC.

                                     By:
                                        ----------------------------------------
                                     Name:
                                          --------------------------------------
                                     Title:
                                           -------------------------------------

                                     WARRANT AGENT:

                                     CONTINENTAL STOCK TRANSFER & TRUST
                                     COMPANY

                                     By:
                                        ----------------------------------------
                                     Name:
                                          --------------------------------------
                                     Title:
                                           -------------------------------------

<PAGE>   23
                                                                         Annex 1
                                                                              to
                                                               Warrant Agreement

                          [FORM OF WARRANT CERTIFICATE]

                                     [FACE]

[CUSIP] NO.                                      NUMBER OF
           -----------------------               WARRANTS:
                                                          ----------------------
CERTIFICATE NO.
               ------------------

                                                 Number of
                                                 shares of
                                                 Common Stock:
                                                              -----------------

                                     WARRANT

                           TO PURCHASE COMMON STOCK OF

                          INTEGRATED ORTHOPAEDICS, INC.

         THIS IS TO CERTIFY THAT _______________ (the "Holder"), is the owner of
____ Warrants, each of which represents a right to purchase one (1) Stock Unit
at the Exercise Price (as defined below), in whole or in part, from time to time
from Integrated Orthopaedics, Inc., a Texas corporation (the "Issuer"), at any
time of any Business Day on and after either one year after the date of the
merger of PowerBrief, Inc., a Delaware corporation ("PowerBrief"), with and into
the Issuer (the "PowerBrief Merger"), or the date of termination of the
Agreement and Plan of Merger dated September 15, 2000 between PowerBrief and the
Issuer, as amended from time to time, governing the PowerBrief Merger (such date
of the effective time of the PowerBrief Merger or the termination date being
"Benchmark Date"), other than each period commencing one calendar day prior to
the end of a fiscal quarter and extending through the announcement of the
Issuer's operating results for such fiscal quarter, but not later than 5:00
p.m., New York City time, on the Expiration Date (as defined below), subject to
the terms and conditions hereinbelow; provided, however, that no Holder shall be
entitled to exercise such Holder's Warrants at any time, unless, at the time of
exercise, (i) a registration statement under the Securities Act relating to the
Warrant Stock has been filed with, and declared effective by, the Commission,
and no stop order suspending the effectiveness of such registration statement
has been issued by the Commission or (ii) the issuance of the issuance of
Warrant Stock is permitted pursuant to an exemption from the registration
requirements of the Securities Act. "Exercise Price" per Whole Unit shall mean
1.25 times the lesser of (i) $0.2963 and (ii) the lowest average closing price
of the Common Stock over any consecutive 20 calendar days during the 90 calendar
days after the Benchmark Date, provided that if the amount in clause (ii) cannot
be determined by a publication by the AMEX or the National Quotations Bureau
LLP, the lowest average closing price for such period shall be determined in
good faith by the Board of Directors. An inverse adjustment in the Exercise
Price for a Whole Unit shall be made each time an adjustment is made in the
number of Stock Units that make up a Whole Unit pursuant to Section 6 of the
Warrant Agreement. Within 120 days after the Benchmark Date, the Issuer shall
cause to be filed with the Warrant Agent and shall cause to be mailed to the
Holder of this Warrant Certificate at such Holder's address appearing on the
Warrant Register by first class mail, postage prepaid a notice setting forth the
Exercise Price as determined 90 days after the Benchmark Date. "Expiration Date"
shall mean the fifth anniversary of the Benchmark Date; provided, however, that
the Issuer shall cause to be filed with the Warrant Agent and shall cause to be
mailed the Holder of this Warrant Certificate at such Holder's address appearing
on

<PAGE>   24

the Warrant Register by first class mail, postage prepaid at least ten days
before the Expiration Date (but no more than 30 days before the Expiration Date)
a written notice that his Warrants are subject to this expiration provision;
provided further that if no such notice is provided as contemplated by the
immediately preceding proviso, the Expiration Date shall mean the date which is
ten days after such notice is mailed.

         This Warrant Certificate is issued under and in accordance with a
Warrant Agreement dated December 19, 2000 (the "Warrant Agreement"), between the
Issuer and Continental Stock Transfer & Trust Company, as Warrant Agent, and is
subject to the Articles of Incorporation and Bylaws of the Issuer and to the
terms and provisions contained therein, all of which terms and provisions the
Holder of this Warrant Certificate consents to by acceptance hereof. The terms
of the Warrant Agreement are hereby incorporated herein by reference and made a
part hereof. Reference is hereby made to the Warrant Agreement for a full
description of the rights, limitations of rights, obligations, duties and
immunities thereunder of the Issuer and the Holders of the Warrants. The summary
of the terms of the Warrant Agreement contained in this Warrant Certificate is
qualified in its entirety by express reference to the Warrant Agreement. All
terms used in this Warrant Certificate that are defined in the Warrant Agreement
shall have the meanings assigned to them in such agreement.

         Notwithstanding any other provision herein, except the requirement that
the Warrant Stock is registered under the Securities Act or that the issuance
thereof is exempted from the registration requirements of the Act upon a Change
of Control (as defined below), other than as a result of the consummation of the
PowerBrief Merger, the Warrants shall immediately become exercisable, in whole
or in part, from time to time, at any time prior to the Expiration Date. "Change
of Control" is defined as (i) the acquisition by another person or group of
persons of 35% or more of the outstanding shares of Common Stock of the Issuer,
(ii) a majority change in the Board of Directors over a twelve-month period,
(iii) a merger, consolidation, or other similar transaction with another entity
in which the Issuer is not the surviving entity or in which the Issuer's
shareholders do not own a majority of the shares in the combined entity or (iv)
a sale of all or substantially all of the Issuer's assets.

         A Warrant may be exercised upon surrender hereof at the principal
office of the Warrant Agent with the form of exercise on the reverse hereto (the
"Exercise Notice") duly completed and signed and upon payment to the Exercise
Price as adjusted as herein provided for each of share of Warrant Stock in
respect of which such Warrant is then exercised.

         This Exercise Price shall be payable (a) by Federal wire transfer to
the account designated by the Issuer or by certified or official bank check
payable to the order of the Issuer or (b) by presentment of Warrants to the
Issuer for cancellation in accordance with the following formula: in exchange
for each share of Warrant Stock issuable on exercise of each Warrant represented
by this Warrant Certificate that is being exercised, the Holder shall receive
such number of shares of Warrant Stock as is equal to the product of (i) the
number of shares of Warrant Stock issuable upon exercise of the Warrants being
exercised at such time multiplied by (ii) a fraction, the numerator of which is
the fair market value per share of Warrant Stock at such time minus the Exercise
Price per share of Warrant Stock at such time, and the denominator of which is
the fair market value per share of Warrant Stock at such time. The fair market
value of Warrant Stock shall be the fair market value as confirmed in writing to
the Warrant Agent by the Issuer. Upon receipt hereof, the Issuer shall, as
promptly as practicable, execute or cause to be executed and deliver or cause to

<PAGE>   25

be delivered to the Holder a certificate or certificates representing the
aggregate number of shares of Warrant Stock and other securities issuable upon
such exercise and any other property to which such Holder is entitled.

         This Warrant Certificate and all rights hereunder are transferable by
the registered Holder hereof, in whole or in part, on the register of the Issuer
maintained by the Warrant Agent for such purpose at the Warrant Agent's office
in New York, New York, upon surrender of this Warrant Certificate duly endorsed,
or accompanied by a written instrument of transfer in form satisfactory to the
Issuer and the Warrant Agent duly executed, with signatures guaranteed as
specified in the attached Form of Assignment, by the registered Holder hereof or
such Holder's attorney duly authorized in writing and by such other
documentation required pursuant to the Warrant Agreement and upon payment of any
necessary transfer tax or other governmental charge imposed upon such transfer.
Upon any partial transfer, the Issuer will sign and issue and the Warrant Agent
will countersign and deliver to such Holder a new Warrant Certificate or
Certificates with respect to any portion not so transferred. Each taker and
Holder of this Warrant Certificate, by taking and holding the same, consents and
agrees that prior to the registration of transfer as provided in the Warrant
Agreement, the Issuer and the Warrant Agent may treat the Person in whose name
the Warrants are registered as the absolute owner hereof for any purpose and as
the Person entitled to exercise the rights represented hereby, any notice to the
contrary notwithstanding. Accordingly, the Issuer and/or the Warrant Agent shall
not, except as ordered by a court of competent jurisdiction as required by law,
be bound to recognize any equitable or other claim to or interest in the
Warrants on the part of any Person other than such registered Holder, whether or
not it shall have express or other notice thereof.

         This Warrant Certificate may be exchanged at the office of the Warrant
Agent maintained for such purpose in New York, New York, for Warrant
Certificates representing the same aggregate number of Warrants, each new
Warrant Certificate to represent such number of Warrants as the Holder hereof
shall designate at the time of such exchange.

         Prior to the exercise of the Warrants represented hereby, the Holder of
this Warrant Certificate, as such, shall not be entitled to any rights of a
shareholder of the Issuer, including, without limitation, the right to vote or
to consent to any action of the shareholders, to receive any distributions, to
exercise any preemptive right or to receive any notice of meetings of
shareholders, and shall not be entitled to receive any notice of any proceedings
of the Issuer except as provided in the Warrant Agreement.

         The Issuer shall not be required to issue a fractional amount of
Warrant Stock upon exercise of Warrants. As to any fraction of a share of
Warrant Stock which the Holder would otherwise be entitled to purchase upon such
exercise the Issuer shall pay a cash adjustment in respect of such final
fraction in an amount equal to the same fraction of the fair market value per
share of Warrant Stock on the date of exercise. The fair market value of Warrant
Stock shall be the fair market value as confirmed in writing to the Warrant
Agent by the Issuer.

         This Warrant Certificate shall not be valid for any purpose until it
shall have been countersigned by the Warrant Agent.

<PAGE>   26
                                              INTEGRATED ORTHOPAEDICS, INC.

                                              By:
                                                 -------------------------------
                                              Name:
                                                   -----------------------------
                                              Title:
                                                    ----------------------------

Dated:

Countersigned:

CONTINENTAL STOCK TRANSFER
  AND TRUST COMPANY,
as Warrant Agent

By:
    --------------------------------------
    Authorized Officer

<PAGE>   27

                             FORM OF EXERCISE NOTICE

                 (To be executed only upon exercise of Warrant)

To:      Continental Stock Transfer & Trust Company,
              as Warrant Agent
         2 Broadway
         New York, New York 10004
         Attention: Compliance Department

         The undersigned irrevocably exercises _________ Warrants and herewith
makes payment of $ _________ (such payment being by Federal wire transfer to the
account designated by Integrated Orthopedics, Inc. or by certified or official
bank check payable to the order or at the direction of Integrated Orthopedics,
Inc.), or exercise its right to receive shares of Warrant Stock without payment
of the Exercise Price in cash on the terms and conditions specified in this
Warrant Certificate and in the Warrant Agreement and surrenders this Warrant
Certificate and all right, title and interest therein to and directs that the
Common Stock, par value $0.001 per share, of Integrated Orthopedics, Inc.
deliverable upon the exercise of such Warrants be registered or placed in the
name and at the address specified below and delivered thereto.

    Dated:
            -------------------

                                      ------------------------------------------
                                      (Signature of Owner)

                                      -----------------------------------------
                                      (Street Address)

                                      ------------------------------------------
                                      (City)         (State)       (Zip Code)

Securities and/or check or other property to be issued or delivered to:

Please insert social security or identifying number:
                                                     ---------------------------

Name:
     ---------------------------------------------------

Street Address:
               -----------------------------------------

City, State and Zip Code:
                         -------------------------------

<PAGE>   28
                               FORM OF ASSIGNMENT

         In consideration of monies or other valuable consideration received
from the Assignee(s) named below, the undersigned registered Holder of this
Warrant Certificate hereby sells, assigns, and transfers unto the Assignee(s)
named below (including the undersigned with respect to any Warrants constituting
a part of the Warrants evidenced by this Warrant Certificate not being assigned
hereby) all of the right of the undersigned under this Warrant Certificate, with
respect to the number of Warrants set forth below:

Name(s) of Assignee(s):
                        --------------------------------------------------------

Address:
         -----------------------------------------------------------------------

No. of Warrants:
                 ---------------------------------------------------------------

Please insert social security or other identifying number of assignee(s):

and does hereby irrevocably constitute and appoint _________________________ the
undersigned's attorney to make such transfer on the books of___________________
maintained for the purposes, with full power of substitution in the premises.

Dated:
       -----------------------------

                                 -----------------------------------------------
                                 (Signature of Owner)

                                 -----------------------------------------------
                                 (Street Address)

                                 -----------------------------------------------
                                 (City)         (State)           (Zip Code)

                                 Signature Guaranteed By:

                                 -----------------------------------------------
                                 Signatures must be guaranteed by an "eligible
                                 guarantor institution" meeting the requirements
                                 of the Warrant Agent, which requirements
                                 include membership or participation in the
                                 Security Transfer Agent Medallion Program
                                 ("STAMP") or such other "signature guarantee
                                 program" as may be determined by the Warrant
                                 Agent in addition to, or in substitution for,
                                 STAMP, all in accordance with the Securities
                                 Exchange Act of 1934, as amended.

<PAGE>   29
                                                                         ANNEX 2

                    CERTIFICATE TO BE DELIVERED UPON EXCHANGE
                     OR REGISTRATION OF TRANSFER OF WARRANTS

Re: Warrants to Purchase Common Stock (the "WARRANTS") of INTEGRATED
ORTHOPEDICS, INC.

         This Certificate relates to ____ Warrants held in certificated form by
_____________ (the "TRANSFEROR").

         The Transferor has requested the Warrant Agent by written order to
exchange or register the transfer of a Warrant or Warrants.

         In connection with such request and in respect of each such Warrant,
the Transferor does hereby certify that Transferor is familiar with the Warrant
Agreement relating to the above captioned Warrants and the restrictions on
transfers thereof as provided in Section 5 of such Warrant Agreement, and that:

(i) [ ] Such Warrant is begin transferred pursuant to an effective registration
statement under the Securities Act; or

(ii) the transfer of this Warrant does not require registration under the
Securities Act of 1933, as amended (the "SECURITIES ACT") because:

          [ ] Such Warrant is being transferred pursuant to an exemption from
registration in accordance with Rule 144 under the Securities Act; or

          [ ] Such Warrant is being transferred in reliance on and in compliance
with an exemption from the registration requirements of the Securities Act other
than Rule 144 under the Securities Act.

An opinion of counsel to the effect that such transfer does not require
registration under the Securities Act accompanies this Certificate.

                                             -----------------------------------
                                             [INSERT NAME OF TRANSFEROR]

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

Date:
     -------------------------<PAGE>   1

                                                                   EXHIBIT 10.17

                            LIMITED LIABILITY COMPANY

                                    AGREEMENT

                                       OF

                      WESTBANK AMBULATORY CARE CENTER, LLC,
                      a Delaware limited liability company

<PAGE>   2

         THE MEMBERSHIP INTERESTS REPRESENTED HEREBY (THE "INTERESTS") WERE
ACQUIRED WITHOUT REGISTRATION WITH THE SECURITIES AND EXCHANGE COMMISSION UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), ON THE BASIS THAT
THE SALE AND ISSUANCE OF THE INTERESTS ARE INTENDED TO BE EXEMPT UNDER SECTIONS
3(a)(11) AND/OR 4(2) OF THE SECURITIES ACT.

         THE INTERESTS HAVE NOT BEEN QUALIFIED WITH THE STATE OF LOUISIANA AND
ARE BEING OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY THE
LOUISIANA ADMINISTRATIVE CODE, AS AMENDED (THE "LOUISIANA ACT"). INTERESTS MAY
NOT BE SOLD TO RESIDENTS OF ANY STATE OTHER THAN LOUISIANA.

         THE OFFER AND SALE OF THE INTERESTS HAS NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES
REGULATORY AGENCY OF ANY STATE, INCLUDING LOUISIANA, NOR HAS SUCH COMMISSION OR
ANY SUCH AGENCY PASSED UPON THE ACCURACY OR ADEQUACY OF THIS OFFERING OR
QUALIFIED OR REGISTERED THE INTERESTS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE. NO TRANSFER OF THE INTERESTS OR ANY INTEREST THEREIN MAY BE
MADE EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT AND UNLESS QUALIFIED OR REGISTERED WITH APPLICABLE STATE SECURITIES
REGULATORY AGENCIES UNLESS THE ISSUER HAS RECEIVED AN OPINION OF COUNSEL
SATISFACTORY TO IT THAT SUCH TRANSFER DOES NOT REQUIRE SUCH REGISTRATION OR
QUALIFICATION.

         ALL RESALES OF ANY INTERESTS MAY BE MADE ONLY TO PERSONS RESIDING IN
THE STATE OF LOUISIANA. THE LIMITED LIABILITY COMPANY SHALL MAKE AN APPROPRIATE
STOP TRANSFER NOTATION REGARDING THE INTERESTS IN ITS RECORDS. THE SALE OR
TRANSFER OF ANY INTEREST IN THE INTERESTS IS FURTHER RESTRICTED BY THE
PROVISIONS HEREIN.

<PAGE>   3

                           LIMITED LIABILITY COMPANY

                                   AGREEMENT

                                       OF

                     WESTBANK AMBULATORY CARE CENTER, LLC,

                      A DELAWARE LIMITED LIABILITY COMPANY

         THIS LIMITED LIABILITY COMPANY AGREEMENT (this "Agreement") of Westbank
Ambulatory Care Center, LLC, a Delaware limited liability company (the
"Company"), is made effective as of the 3rd day of November, 1999 (the
"Effective Date"), by IOI Management Services of Louisiana, Inc., a Louisiana
corporation (the "IOI Member").

                                  WITNESSETH:

         The Company was formed by the filing of its Certificate of Formation
(the "Certificate of Formation") on November 3, 1999, with the Secretary of
State of the State of Delaware. The IOI Member shall be the initial member of
the Company (the "Initial Member"), and the Initial Member hereby ratifies the
formation of the Company and agrees that this Agreement shall constitute the
limited liability company agreement of the Company.

                                   ARTICLE I

                                  DEFINITIONS

         All capitalized words that are used in this Agreement and that are not
capitalized for purposes of grammar shall be defined as set forth below:

         Section 1.1 Accumulated Cash shall have the meaning given to such term
in Section 8.4(b).

         Section 1.2 Act shall mean the Delaware Limited Liability Company Act,
as amended.

         Section 1.3 Affiliate shall mean any person or entity that directly or
indirectly through one or more intermediaries, controls or is controlled by, or
is under common control with, another person or entity.

         Section 1.4 Agreement shall mean this limited liability company
agreement of Westbank Ambulatory Care Center, LLC, a Delaware limited liability
company.

         Section 1.5 Ambulatory Surgery Center shall have the meaning given to
such term in Section 2.4.

         Section 1.6 ASC Location shall have the meaning given to such term in
Section 2.3.

         Section 1.7 Approving Physician Members shall have the meaning given to
such term in Section 10.4(a).

<PAGE>   4

         Section 1.8 Capital Account shall have the meaning given to such term
in Section 3.3(a).

         Section 1.9 Carrying Value means, with respect to any asset, the
asset's adjusted basis for federal income tax purposes except as follows:

                  (i) the initial Carrying Value of any asset contributed (or
deemed contributed) to the Company shall be such asset's gross fair market value
at the time of such contribution;

                  (ii) the Carrying Values of all Company assets shall be
adjusted to equal their respective gross fair market values in accordance with,
and as permitted by, Section 1.704-1(b)(2)(iv)(f) of the Regulations;

                  (iii) if the Carrying Value of an asset has been determined
pursuant to clause (i) or (ii) above, such Carrying Value shall thereafter be
adjusted in the same manner as would the asset's adjusted basis for federal
income tax purposes.

         Section 1.10 Certificate of Formation shall have the meaning given to
such term in the Preamble.

         Section 1.11 Change of Control shall mean a Transfer of fifty percent
(50%) or more of the stock, partnership interests, membership interests or
beneficial interests, as applicable, of a Member.

         Section 1.12 Code means the Internal Revenue Code of 1986, as amended.

         Section 1.13 Collective Physician Interests shall have the meaning
given to such term in Section 10.4(a).

         Section 1.14 Company means Westbank Ambulatory Care Center, LLC, a
Delaware limited liability company.

         Section 1.15 Company Interests has the meaning given to such term in
Section 10.1.

         Section 1.16 Company Purchase Notice has the meaning given to such term
in Sections 10.2(a)(iii) and 10.3(e).

         Section 1.17 Confidential Business Information has the meaning given to
such term in Section 10.12.

         Section 1.18 Distributable Cash shall have the meaning given to such
term in Section 8.4(a)

         Section 1.19 Effective Date shall have the meaning given to such term
in the Introduction.

         Section 1.20 Initial Member shall have the meaning given to such term
in the Preamble.

                                       2
<PAGE>   5

         Section 1.21 IOI Member shall have the meaning given to such term in
the Introduction.

         Section 1.22 IOI Manager shall have the meaning given to such term in
Section 5.2.

         Section 1.23 Joinder shall have the meaning given to such term in
Section 4.3.

         Section 1.24 Managers shall have the meaning given to such term in
Section 5.2.

         Section 1.25 Management Board has the meaning given to such term in
Section 5.1.

         Section 1.26 Material Adverse Effect shall mean any change, event,
action, condition or effect which individually or in the aggregate: (i) impairs
the validity or enforceability of this Agreement; or (ii) materially and
adversely affects the business, operations, prospects or financial condition of
the Company or materially and adversely affects the ability of the Company to
carry out its business; or (iii) materially and adversely affects the ability of
the Members to carry out their respective obligations under this Agreement.

         Section 1.27 Material Breach shall mean any breach of this Agreement by
any Member that is not cured within thirty (30) days after such Member receives
written notice of such breach.

         Section 1.28 Medical Staff shall have the meaning given to such term in
Section 5.16.

         Section 1.29 Medical Staff Bylaws shall have the meaning given to such
term in Section 5.16.

         Section 1.30 Members shall mean those persons or entities as may from
time to time be admitted to the Company upon such terms and conditions as
provided in this Agreement and under the Act.

         Section 1.31 Member Purchase Notice has the meaning given to such term
in Sections 10.2(a)(ii) and 10.3(d).

         Section 1.32 Net Profits and Net Losses mean the taxable income or
loss, as the case may be, for a period (or from a transaction) as determined in
accordance with Section 703(a) of the Code (for this purpose, all items of
income, gain, loss, or deduction required to be separately stated pursuant to
Section 703(a)(1) of the Code shall be included in taxable income or loss)
computed with the following adjustments:

                  (i) items of gain, loss, and deduction shall be computed based
upon the Carrying Values of the Company's assets rather than upon the assets'
adjusted bases for federal income tax purposes;

                  (ii) any tax-exempt income received by the Company shall be
included as an item of gross income;

                                       3
<PAGE>   6

                  (iii) the amount of any adjustments to the Carrying Values of
any assets of the Company pursuant to Code Section 743 shall not be taken into
account; and

                  (iv) any expenditure of the Company described in Section
705(a)(2)(B) of the Code (including any expenditures treated as being so
described pursuant to Treasury Regulations under Section 704(b) of the Code)
shall be treated as a deductible expense.

         Section 1.33 Non-Approving Physician Members shall have the meaning
given to such term in Section 10.4(a).

         Section 1.34 Offer shall have the meaning given to such term in Section
10.3.

         Section 1.35 Offered Company Interests has the meaning given to such
term in Section 10.3(b).

         Section 1.36 Original Notice has the meaning given to such term in
Section 10.3.

         Section 1.37 Percentage Interests means with respect to any particular
Member at any point in time the result of the following division: (a) the
Capital Account of such Member adjusted as provided for in Section 3.3, as
applicable, divided by (b) the total of the Capital Accounts of all Members
adjusted as provided for in Section 3.3, as applicable. The combined Percentage
Interests of all Members shall at all times equal one hundred percent (100%).

         Section 1.38 Permanent Disability has the meaning given to such term in
Section 10.2(d)(ii).

         Section 1.39 Physician Members shall mean Members of the Company who
are described in Section 4.1(b), (c) or (d), and each such Member shall
sometimes individually be referred to herein as a "Physician Member."

         Section 1.40 Physician Manager shall have the meaning given to such
term in Section 5.2.

         Section 1.41 Practice Area shall mean any place within a twenty (20)
mile radius of the street address of the Ambulatory Surgery Center.

         Section 1.42 Private Placement Offering means, pursuant to a written
private placement memorandum, the Initial Member's first offering and sale of
Percentage Interests in the Company to persons or entities who meet the
requirements of Section 4.1(b), (c) or (d) herein.

         Section 1.43 Regulations means the Treasury Regulations promulgated
under the Code, as from time to time in effect.

         Section 1.44 Section 10.5 Repurchase has the meaning given to such term
in Section 10.5.

                                       4
<PAGE>   7

         Section 1.45 Section 10.6 Repurchase has the meaning given to such term
in Section 10.6.

     Section 1.46 Selling Physician Member has the meaning given to such term in
Section 10.2(a)(i).

         Section 1.47 Services shall mean the type of services rendered at an
ambulatory surgery center.

         Section 1.48 Territory shall mean any place within a fifty (50) mile
radius of the street address of the Ambulatory Surgery Center.

         Section 1.49 Transfer shall mean any involuntary or voluntary sale,
lease, pledge, assignment, grant of a security interest, subcontract, dividend,
merger, consolidation, gift or other disposition, direct or indirect, by
operation of law or otherwise.

         Section 1.50 Transferor has the meaning given to such term in Section
10.3.

         Section 1.51 Triggering Event has the meaning given to such term in
Section 10.2(b).

         Section 1.52 Value has the meaning given to such term in Section
10.2(c).

         Section 1.53 Value Notice has the meaning given to such term in Section
10.2(a)(i).

                                   ARTICLE II
                    NAME, OFFICE AND FORMATION OF THE COMPANY

         Section 2.1 Name. The name of the Company is Westbank Ambulatory Care
Center, LLC.

         Section 2.2 Registered Office and Agent. The registered office and
agent of the Company are as set forth in the Certificate of Formation.

         Section 2.3 Principal Place of Business. The Company's principal place
of business, and the place where its books and records shall be kept, shall be
4511 Westbank Expressway, Marrero, Louisiana 70072 (the "ASC Location") or such
other place as determined from time to time by the Members. The records of the
Company will be available for inspection and copying by the Members at such
office to the extent required under the Act during regular business hours.

         Section 2.4 Purpose. The purposes of the Company are, in furtherance of
objectives by and within legal limitations imposed upon the Members, to pool
certain capital and resources and to operate an ambulatory surgery center (the
"Ambulatory Surgery Center") at the ASC Location for profit and to hold the same
for investment purposes, to sell any interest therein at such time and upon such
terms as the Members may deem suitable in their discretion subject to and
consistent with the terms hereof, and to engage in any and all general business
activities related or incident thereto consistent with the terms of this
Agreement.

                                       5
<PAGE>   8

         Section 2.5 Term. The term of the Company shall be perpetual unless
sooner dissolved as provided in Section 12.1.

                                  ARTICLE III
                                 CAPITALIZATION

         Section 3.1 Capital Contributions. The initial capital contribution of
the Initial Member shall be in cash and shall be delivered in total prior to or
immediately upon the closing of the Private Placement Offering. The Initial
Member's initial capital contribution shall total the following amount:

                IOI Member                         $625,000

         Section 3.2 Additional Capital Contributions. Physician Members shall
make capital contributions in accordance with the terms of the Private Placement
Offering or Section 4.3, as applicable. At the request of the Management Board,
the Members shall make additional capital contributions to the Company in such
pro rata amounts, determined in accordance with and consistent with maintaining
each Member's current Percentage Interests, as the Management Board may
determine are necessary for the working capital of the Company, subject to
Section 5.15.

         Section 3.3 Capital Accounts.

              (a) The Company shall establish and maintain a capital account for
each Member (a "Capital Account"). The initial amount of each Member's Capital
Account shall be the amount contributed by the Member pursuant to Section 3.1 or
Section 3.2, as applicable, and shall be increased by allocations of Net
Profits, decreased by allocations of Net Losses, and adjusted to reflect the
special allocations in Sections 8.2 and 8.3.

              (b) The Capital Accounts shall be maintained for each Member in
accordance with the Code and the Regulations, including without limitation:

                  (i) the adjustments permitted or required by Code Section
704(b) and, to the extent applicable, the principles expressed in Code Section
704(c); and

                  (ii) the adjustments required to maintain capital accounts in
accordance with the "substantial economic effect test" set forth in the
Regulations under Code Section 704(b).

              (c) The Members' Capital Account balances shall be adjusted in
accordance with Regulation Section 1.704-1(b)(2)(iv)(g), or any corresponding
future Regulation, with respect to Company property having a book value that
differs from the adjusted tax basis of such property.

              (d) No Member shall be obligated to restore any deficit in its
Capital Account upon dissolution or liquidation.

                                       6
<PAGE>   9

              (e) Upon transfer of any Capital Account, the Capital Account of
the transferee shall be adjusted to reflect the amount of the transferor's
Capital Account (or the applicable Percentage Interests thereof in the case of a
partial transfer) and the transferor's Capital Account shall be adjusted
accordingly.

              (f) If distributions under this Agreement are insufficient to
return to any Member the full amount of such Member's capital contributions to
the Company, such Member shall have no recourse against any other Member for the
return of such capital contributions.

         Section 3.4 Return of Capital and Waiver of Partition. No Member has
the right to demand or receive from the Company any return of capital
contributions made pursuant to this Agreement, except with respect to
distributions during the term of this Agreement or upon dissolution of the
Company. No Member has the right to demand and receive any distribution from the
Company in any form other than cash.

         Section 3.5 Third Party Loans and other Financial Obligations of the
Company. If necessary for working capital purposes, the Company may borrow from
the Members or from third-party lenders such amounts as the Members determine
are necessary, on such terms and conditions as the Members consider reasonable.
Each of the Members, or principals thereof, as applicable, may have the
obligation to personally, jointly and severally guarantee certain third-party
loans to the Company (if any are obtained) and other financial obligations of
the Company on a pro rata basis in accordance with his/her/its Percentage
Interests (or the Percentage Interests of the Member of which he/she/it is
affiliated, as applicable), as determined by the Members pursuant to the
Company's negotiation of any loan terms and documentation with third-party
lenders and other obligees; provided, however, the Members shall not be
obligated to personally guarantee such loans unless the Members approve such
obligations pursuant to Section 5.15(m).

         Section 3.6 Limited Liability. No Member shall, nor shall any officer,
director, employee or agent of any Member be, liable for any debts, liabilities
or obligations of the Company; provided that each Member (or its principal for
the purposes of subsection (c)) shall be responsible for the:

              (a) making of any contribution to the capital of the Company
required to be made by such Member pursuant to the terms of this Agreement;

              (b) amount of any distribution made to such Member that must be
returned to the Company pursuant to the Act; and

              (c) guaranties (if any) made by Members (or their principals) of
any loans or other obligations, as determined by the Members pursuant to Section
3.5.

                                   ARTICLE IV
                 RIGHTS, DUTIES AND RESTRICTIONS OF THE MEMBERS

         Section 4.1 General. Only the following persons or entities may be
Members: (a) the IOI Member or any Affiliate, subsidiary, or successor of the
IOI Member; (b) an individual who: (i) is a bona fide resident of the State of
Louisiana; (ii) is licensed by the State of Louisiana

                                       7
<PAGE>   10

either as a medical doctor, doctor of osteopathy, podiatrist or dentist who
lawfully holds himself out as an oral surgeon; (iii) provides medical services
that include surgical services (or other procedures that can be performed in an
ambulatory surgery center) on a full-time basis (at least thirty (30) hours a
week, forty-eight (48) weeks per year) in the Practice Area; and (iv) has active
medical staff privileges at the Ambulatory Surgery Center, if the Ambulatory
Surgery Center is operational, or if the Ambulatory Surgery Center is not yet
operational, has active medical staff privileges at a hospital located within
the Practice Area; (c) Louisiana professional corporations, business
corporations, limited liability companies, family limited partnerships,
professional partnerships or pension plans, as long as the shareholders,
partners or principal beneficiaries, as applicable, that effectively control
such entities meet the requirements for individuals as set forth in this Section
4.1(b); provided that the entity designates, at the time of investment, one or
more individuals (as may be required by the Management Board) meeting the
requirements of Section 4.1(b) and such person or persons continue(s) to meet
such requirements and agree(s) to be bound as a "Member" to all of the terms of
this Agreement; or (d) with the approval of the Management Board, retirement or
other trusts primarily for the benefit of the person or persons specified in
Section 4.1 (b) or other forms of joint ownership where at least one of the
owners meets the requirements specified in Section 4.1(b); provided such plan,
trust or owners designate, at the time of investment, an individual meeting the
requirements of Section 4.1(b) and such person continues to meet such
requirements and agrees to be bound as a "Member" to all of the terms of this
Agreement; (e) purchasers of the IOI Member's Interests pursuant to Section
10.3; or (f) purchasers of Collective Physician Interests pursuant to Section
10.4.

         Section 4.2 Voting Right. All Members of the Company shall have the
right to vote on any matter which, pursuant to the Act or this Agreement,
Members are entitled to vote.

         Section 4.3 New Physician Members. Individuals meeting the requirements
of Sections 4.1(b), (c) or (d) shall become Physician Members of the Company
pursuant to the terms of the Private Placement Offering, upon the date of
closing established thereunder. Thereafter, following the closing of the Private
Placement Offering, new Physician Members (subject to Section 4.1) shall be
admitted only upon: (i) the consent of the holders of fifty-one percent (51%) of
the total issued and outstanding Percentage Interests then held by Physician
Members and the consent of the IOI Member, unless such new Member obtained his,
her or its, as applicable, Company Interests pursuant to the terms of Section
10.3; (ii) either the payment of a fair market value purchase price by the new
Physician Member to the Company in exchange for the Company issuing the
applicable Percentage Interest to the new Physician Member or the payment of a
fair market value purchase price by the new Physician Member pro-rata to each of
the existing Members in exchange for each of the existing Members transferring
the applicable pro-rata portion of their Percentage Interests such that existing
Members are diluted "equally" (meaning all existing Members are diluted to the
Percentage Interests that such existing Members would have had if the Company
had issues the Percentage Interests to the new Physician Member); and (iii) the
execution of, and the acceptance by the Company of a joinder (the "Joinder") to
this Agreement substantially in the form of Exhibit 4.3 attached hereto and
incorporated by this reference herein. Any purported new Member admitted in
violation of this Agreement shall not be recognized as a Member and shall not be
entitled to any rights or powers accorded to a Member under law or this
Agreement.

                                       8
<PAGE>   11

         Section 4.4 Annual Meeting of Members. The annual meeting of the
Members shall be held in January of each year or at such other time within six
(6) months after the close of the fiscal year of the Company as may be
determined by the Management Board. The annual meeting shall be held for such
purposes as may be prescribed by law, the Certificate of Formation or this
Agreement, or as may be prescribed by the Management Board. If such annual
meeting is not held on the day herein provided therefor, a special meeting may
be held in lieu thereof, and business transacted or elections held at such
meeting shall have the same effect as if transacted or held at the annual
meeting.

         Section 4.5 Special Meetings. Special meetings of the Members may be
called at any time at the request of the Chief Executive Officer, at the request
of the IOI Member, or by a majority of the members of the Management Board and
shall be called by the Secretary (or in the case of the death, absence,
incapacity or refusal of the Secretary, by any other officer) upon the written
request of the holders of twenty-five percent (25%) or more of the total issued
and outstanding Percentage Interests then held by Physician Members.

         Section 4.6 Meetings by Telecommunications. Unless the Act otherwise
provides, the Members may participate in a meeting of the Members by means of a
conference telephone or similar communications equipment by means of which all
persons participating in the meeting can hear each other at the same time and
participation by such means shall constitute presence at a meeting.

         Section 4.7 Place of Meetings. Meetings of the Members shall be held
anywhere in the United States, at such place or places as may be fixed by the
Management Board and stated in the notice of the meeting.

         Section 4.8 Notice of Meeting. Notice of each meeting of the Members,
stating the day, hour and place thereof, shall be given to each Member by the
Chief Executive Officer, Secretary or the Member calling the meeting at least
seven (7) days before the meeting, as follows: (i) by leaving such notice at the
residence or usual place of business of such Member; (ii) by mailing such
notice, postage prepaid, and addressed to such Member at his/her address as it
appears in the records of the Company; (iii) by facsimile or electronic mail
transmission of such notice to such person's usual place of business; or (iv) by
hand delivery to such person at his/her usual place of business or, in the event
such notice is given on a Saturday, Sunday or holiday, to such person at his/her
residence. If mailed, such notice shall be deemed to be delivered two (2)
business days following the date deposited in the United States mail properly
addressed, with postage thereon prepaid. If notice is given by facsimile or
electronic mail transmission, such notice shall be deemed given upon
confirmation of receipt. Notice need only contain a summary of the purpose of
the meeting, except that the notice of any meeting at which an amendment of this
Agreement or the Certificate of Formation is to be considered shall state the
intended purpose and effect of the proposed amendment and shall state the
proposed wording of the amendment.

         Section 4.9 Quorum. Except as otherwise required by this Agreement or
the Act, at any meeting of the Members, a quorum for the transaction of business
shall consist of the presence in person or by proxy of the holders of at least
eighty-one (81%) of the total Percentage Interests, but if less than a quorum is
present, the Members present may adjourn the meeting

                                       9
<PAGE>   12

and may reconvene the meeting without further notice. No Member shall fail to
attend a meeting of the Members for purposes of defeating a quorum or avoiding
corporate action.

         Section 4.10 Action at a Meeting. When a quorum is present at any
meeting, the holders of a majority of the Percentage Interests present at such
meeting and entitled to vote on such matter may decide any question properly
brought before such meeting, except as otherwise required by this Agreement or
the Act. The Members may only act on those matters which expressly require
Member approval under the Act or this Agreement.

         Section 4.11 Action by Consent. Any action required or permitted to be
taken at any meeting of the Members may be taken without a meeting if the IOI
Member and the holders of fifty-one percent (51%) of the total Percentage
Interests held by Physician Members and entitled to vote on such matter consent
to the action in writing, and such written consents are filed with the records
of the meetings of the Members. Such consent shall be treated for all purposes
as a vote at a meeting.

         Section 4.12 Waiver of Notice. Whenever any written notice is required
to be given by this Agreement, a waiver of notice signed either before or after
the action for which notice is required shall have the effect of written notice.
Attendance by a Member at any meeting shall also constitute a waiver of notice
unless an objection to the lack of notice is made by such Member at the meeting.

         Section 4.13 Voting/Proxy Voting. In any case in which a Member is
entitled to vote and such Member is not an individual, the chief executive
officer or a designated officer or designated officer or principal of such
Member shall exercise such vote on behalf of such Member. Any such chief
executive officer or designated officer or principal of such Member, as well as
any Member who is an individual, may authorize another person to act for him by
proxy executed in writing by him. All proxies shall be filed with the Secretary
before voting, shall be revocable and shall be effective for no more than six
(6) months. No proxy purporting to be executed by the chief executive officer or
the designated officer or principal of a Member or by a Member shall be deemed
invalid unless challenged at or prior to its exercise, and the burden of proving
invalidity shall rest on the challenger.

                                   ARTICLE V
                                MANAGEMENT BOARD

         Section 5.1 Responsibilities. The business, property, and affairs of
the Company shall be managed by or under the direction of a management board
(the "Management Board"), which shall have all powers necessary or desirable to
achieve the purposes of the Company described in Section 2.4.

         Section 5.2 Number, Election and Qualification. The Management Board
shall initially be composed of two (2) individuals. The members of the
Management Board are hereinafter referred to as "Managers." The Managers who
will initially comprise the Management Board are: (i) Douglas P. Badertscher;
and (ii) James D. Needham. These initial Managers shall serve only until the
first annual meeting of the Members held after the Company has admitted
Physician Members, at which time and thereafter the Management Board shall be

                                       10
<PAGE>   13

composed of four (4) individuals. At such meeting and thereafter, Managers shall
be elected pursuant to the provisions set forth below in this paragraph. Two (2)
of the Managers of the Company (each, a "Physician Manager") shall be: (i)
Physician Members and/or principals of Physician Members; and (ii) elected
solely by the holders of a majority of the Percentage Interests owned by the
Physician Members. Two (2) of the Managers of the Company shall be elected
solely by the IOI Member (each, an "IOI Manager"). The number of Managers may be
expanded or reduced from time to time only with the approval of the Members,
subject to the quorum and voting requirements set forth in Section 5.15. No
reduction in the number of Managers shall remove a Manager before the expiration
of that Manager's term unless the Manager is removed pursuant to Section 5.12 of
this Agreement.

         Section 5.3 Term. The initial Managers named above shall serve only
until Managers are elected at the first annual meeting of the Members held after
the Company has admitted Physician Members pursuant to the Private Placement
Offering. The Managers elected at such first annual meeting shall be elected for
a two (2) year term, and thereafter Managers shall be elected for one (1) year
terms. Each elected Manager shall hold office for the specified term and until
his/her successor is elected and qualified, or until he/she sooner dies,
resigns, is removed or becomes disqualified.

         Section 5.4 Annual and Regular Meetings. An annual meeting of the
Management Board shall be held, without notice other than this Agreement,
immediately after and at the same place as, the annual meeting of the Members.
The Management Board may provide, by resolution, the time and place, either
within or outside the State of Louisiana, for the holding of regular meetings in
which case no other notice need be given.

         Section 5.5 Special Meetings. Special meetings of the Management Board
may be called by or at the request of the Chief Executive Officer of the Company
or by any two (2) Managers. The person or persons authorized to call special
meetings of the Management Board may fix any place, either within or outside the
State of Louisiana, as the place for holding any special meeting of the
Management Board.

         Section 5.6 Notice; Waiver of Notice. Written notice of any special
meeting of Managers shall be delivered at least two (2) days before the meeting
as follows: (i) by leaving such notice at the residence or usual place of
business of such Manager; (ii) by mailing such notice, postage prepaid, and
addressed to such Manager at his/her address as it appears in the records of the
Company; (iii) by facsimile or electronic mail transmission of such notice to
such person's usual place of business; or (iv) by hand delivery to such person
at his/her usual place of business or, in the event such notice is given on a
Saturday, Sunday or holiday, to such person at his/her residence. If mailed,
such notice shall be deemed to be delivered two (2) business days following the
date deposited in the United States mail properly addressed, with postage
thereon prepaid. If notice is given by facsimile or electronic mail
transmission, such notice shall be deemed given upon confirmation of receipt.
Notice of a meeting need not be given to any Manager if a written waiver of
notice executed by him before or after the meeting is filed with the records of
the meeting, or to any Manager who attends the meeting without protesting the
lack of notice to such Manager prior to or during such meeting. Neither the
business to be transacted at, nor the purpose of, any regular or special meeting
of the Management Board needs be specified in the notice or waiver of notice of
such meeting.

                                       11
<PAGE>   14

         Section 5.7 Quorum. A majority of the Managers shall constitute a
quorum for the transaction of business at any meeting of the Management Board.
If less than a quorum of Managers is present at a Management Board meeting, a
majority of the Managers present may adjourn the meeting and may reconvene the
meeting without further notice. No Manager shall fail to attend a meeting of the
Management Board for purposes of defeating a quorum or avoiding corporate
action.

         Section 5.8 Voting and Proxy Voting. Except as otherwise required by
the Act, the Certificate of Formation or this Agreement, the affirmative vote of
a majority of the Managers present at a Management Board meeting at which a
quorum is present shall be necessary and sufficient to take any action at a
meeting of the Management Board; provided at least one (1) affirmative vote
shall be from an IOI Manager. A Manager entitled to vote at a meeting or to
express consent or dissent to any action in writing without a meeting may
authorize another party to act for him by proxy executed in writing by him. All
proxies shall be filed with the Secretary before voting, shall be revocable and
shall be effective for no more than six (6) months. No proxy purporting to be
executed by or on behalf of a Manager shall be deemed invalid unless challenged
at or prior to its exercise, and the burden of proving invalidity shall rest on
the challenger.

         Section 5.9 Meetings by Telecommunications. Unless the Act otherwise
provides, members of the Management Board or any committee designated thereby
may participate in a meeting of the Management Board or committee by means of a
conference telephone or similar communications equipment by means of which all
persons participating in the meeting can hear each other at the same time and
participation by such means shall constitute presence at a meeting.

         Section 5.10 Presumption of Assent. A Manager of the Company who is
present at a meeting of the Management Board at which action on any corporate
matter is taken shall be conclusively presumed to have assented to the action
taken unless his/her dissent is entered in the minutes of the meeting or unless
he/she files his/her written dissent to such action with the person acting as
the secretary of the meeting before the adjournment of the meeting or forwards
such dissent by registered mail to the Secretary of the Company immediately
after the adjournment of the meeting. Such right to dissent does not apply to a
Manager who voted in favor of such action.

         Section 5.11 Informal Action by Managers. Any action required or
permitted to be taken at any meeting of the Management Board or any committee,
if any, may be taken without a meeting, if at least the number of Managers
required to approve such action at a meeting consent to the action in writing
and the written consents are filed with the records of the meetings of the
Management Board.

         Section 5.12 Removal of Managers. An elected Physician Manager may be
removed from office with or without cause by the holders of fifty-one percent
(51%) of the Percentage Interests held by Physician Members at any meeting of
the Physician Members called at least in part for that purpose, or by written
consent in lieu thereof. An IOI Manager may be removed from office with or
without cause by the vote of the IOI Member. Failure to attend annually at least
seventy-five percent (75%) of all meetings of the Management Board (unless
excused) shall

                                       12
<PAGE>   15

be cause (but not the only cause) for removal of a Manager. The Manager to be
removed shall have no right to participate in the deliberations or vote of the
Member(s) with respect to the removal vote.

         Section 5.13 Resignation. Any Manager of the Company may resign from
office by delivering or causing to be delivered to any officer of the Company,
or to the Management Board, a written resignation, which shall take effect upon
being so delivered or at such other time as may be therein specified.

         Section 5.14 Vacancies. Any vacancy in a Physician Manager position
shall be filled by the vote of fifty-one percent (51%) of the Percentage
Interests held by the Physician Members, and the Manager so elected shall serve
for the unexpired portion of his/her predecessor's term of office. Any vacancy
in an IOI Manager position shall be filled solely by the IOI Member, and the
Manager so elected shall serve for the unexpired portion of his/her
predecessor's term of office. The Management Board shall have and may exercise
all of its powers notwithstanding the existence of one or more vacancies in its
number.

         Section 5.15 Consent of Members. Notwithstanding anything in this
Agreement to the contrary, the Company shall not take any of the following
actions, and the Management Board shall not take any of the following actions on
behalf of the Company, except with the approval of the holders of fifty-one
percent (51%) of the Physician Member Percentage Interests and the consent of
the IOI Member:

              (a) A sale or transfer of all or substantially all of the
Company's assets or ownership interests, or a merger or consolidation of the
Company.

              (b) Any material change in the business of the Company.

              (c) Dissolution, liquidation or bankruptcy of the Company, or any
action that reasonably could result in the dissolution, liquidation or
bankruptcy of the Company.

              (d) The entering into of any services contract, or of any
amendment to or renewal of a services contract, by the Company for the purchase
or provision of services, at an aggregate contract price in excess of One
Hundred Fifty Thousand Dollars ($150,000), or at an aggregate contract price
reasonably expected to be in excess of One Hundred Fifty Thousand Dollars
($150,000) over the term of such contract.

              (e) Any purchase, acquisition of assets, capital expenditure,
guarantee, incurrence of a loan or other indebtedness, by the Company, in an
amount in excess of Two Hundred Thousand Dollars ($200,000).

              (f) Any capital call or series of capital calls during any one (1)
year period of time which result(s) in any Member of the Company being called on
to contribute during such one (1) year period of time an amount equal to or more
than twenty-five percent (25%) of such Member's original capital contribution to
the Company.

              (g) Any decision to institute any legal proceeding or to file suit
against any person or entity, or any decision for the purposes of responding to
the institution of any legal

                                       13
<PAGE>   16

proceeding or answering a complaint against the Company (other than typical
billing and collections claims that are in the ordinary course of business).

              (h) Any decision by the Company as to whom or what entity will
provide development and business services to the Company, and the material terms
of any agreement or relationship with such company (provided, however, that the
IOI Member shall initially provide such development and business services to the
Company).

              (i) Any amendment to the Certificate of Formation or this
Agreement of the Company.

              (j) Compensation to Managers for attending meetings of the
Management Board.

              (k) Any decision which creates any equity interest in the Company
or creates any equity-like interest in the Company that has rights, preferences
or privileges senior to or similar to the Percentage Interests with respect to
distributions of any kind or approval rights.

              (l) Any change in the total authorized number of Managers of the
Company or the composition of the Management Board as described in Section 5.2.

              (m) Any loan that requires the execution of personal guarantees by
any of the Members.

         Section 5.16 Medical Staff. The group of physicians which will perform
surgical procedures at the Ambulatory Surgery Center shall be referred to herein
as the "Medical Staff." The Management Board hereby adopts bylaws for the
Medical Staff (the "Medical Staff Bylaws") which Medical Staff Bylaws shall
establish a framework of self-government for Medical Staff activities and
accountability of the Medical Staff to the Management Board. The Medical Staff
Bylaws shall include a procedure for physicians on the Medical Staff to obtain
hearings and appeals regarding the decisions of the Management Board regarding
appointment, reappointment, suspension, and revocation of such physicians'
status on the Medical Staff. The Management Board shall have the ultimate power
to appoint, reappoint, suspend, and revoke any physician's Medical Staff
privileges and any allied health professional's privileges, after considering
the recommendation of the Medical Staff's Credentialing Committee, and in
accordance with this Operating Agreement and the Bylaws of the Medical Staff and
the applicable Louisiana Statutes and sections of the Louisiana Administrative
Code. The Medical Staff shall have the following specific duties:

              (a) Require that every patient shall be admitted by and remain
under the care of a member of the organized Medical Staff;

              (b) Require that all medications, treatments and procedures shall
be administered upon specific orders of a member of the organized Medical Staff;

              (c) Require that all attending organized Medical Staff members
have admitting privileges at an acute care hospital;

                                       14
<PAGE>   17

              (d) Provide for a formal and official means of liaison among the
Medical Staff, the Management Board, and the chief administrative officer to
provide a channel for administrative advice; and

              (e) Specify the classification of services to be provided at the
Ambulatory Surgery Center and list authorized surgical procedures.

         Section 5.17 Development and Business Services. The Company shall
retain the IOI Member to provide certain development and business services to
the Company, subject to the control and direction of the Management Board as
described in this Article V. The IOI Member shall enter into that certain
Ambulatory Surgery Center Services Agreement with the Company in substantially
the form attached hereto as Exhibit 5.17. Thereafter, the retention of any
development and business services company and the entering into of any new
agreement or amendment to any agreement for development and business services
shall be subject to the terms of Section 5.15(h).

                                   ARTICLE VI
                                    OFFICERS

         Section 6.1 Number. The principal officers of the Company shall be a
Chief Executive Officer, a Treasurer, a Secretary and such other principal
officers as the Management Board may appoint. The Management Board shall elect
the principal officers. Except as otherwise provided herein, officers need not
be Managers or Members of the Company. The Management Board may from time to
time by resolution appoint such officers, in addition to principal officers, as
it deems necessary, and such officers shall have such authority and shall
perform such duties as from time to time may be prescribed by the Management
Board. Any person may simultaneously hold more than one (1) office of the
Company.

         Section 6.2 Term of Office. The Chief Executive Officer, Treasurer and
Secretary shall each hold office until his/her successor is chosen and qualified
or in each case until he/she sooner dies, resigns, is removed or becomes
disqualified, and each other officer shall hold office in accordance with the
terms of his/her appointment or election.

         Section 6.3 Removal. Any officer of the Company may be removed with or
without cause by a vote of the Managers, or by vote of the holders of fifty-one
percent (51%) of the Physician Member Percentage Interests and the vote of the
IOI Member, at any meeting of the Management Board or Members, as applicable,
called at least in part for that purpose. The officer to be removed shall have
no right to participate in the deliberations and the vote of the Management
Board or Members, as applicable, with respect to the removal vote. At the
request of any Manager or Member, voting by the Management Board or Members with
respect to removal of an officer shall be by closed ballot.

         Section 6.4 Vacancies. A vacancy in any office because of death,
resignation, removal or disqualification, may be filled for the unexpired
portion of the term by vote of the Management Board. New offices established by
the Management Board may be filled at any meeting of the Management Board.

                                       15
<PAGE>   18

         Section 6.5 Bonds. The Management Board may by resolution require any
officer or agent of the Company to give bond to the Company in such amount and
with such surety as the Management Board may deem sufficient, conditioned upon
the faithful performance of their respective duties and offices.

         Section 6.6 Chief Executive Officer. The Chief Executive Officer shall
supervise and direct the day-to-day administration of the Company. The Chief
Executive Officer shall be responsible for managing all affairs of the Company
and shall preside over all meetings of the Members and, except as otherwise
determined in each instance by the Managers of the Management Board. He/she
shall provide leadership, establish strategic direction and shall perform other
responsibilities as are customarily associated with such capacity. The Chief
Executive Officer shall have the responsibility for hiring and firing all
managerial personnel that report directly to the Chief Executive Officer. The
Chief Executive Officer shall report to and be subject to the direction of the
Management Board on all matters.

         Section 6.7 Treasurer. The Treasurer shall: (a) have charge and custody
of and be responsible for all funds and securities of the Company; receive and
give receipts for moneys due and payable to the Company from any source
whatsoever and deposit all such moneys in the name of the Company in such banks,
trust companies or other depositories as shall be selected by the Management
Board; (b) sign checks or drafts on the accounts of the Company up to amounts
authorized from time to time by the Management Board; (c) sign, with the Chief
Executive Officer or any other Manager of the Company, checks or drafts on the
accounts of the Company in amounts authorized from time to time by the
Management Board; (d) prepare or cause to be prepared unaudited financial
statements; and (e) in general, perform all duties incident to the office of
Treasurer and all other duties as from time to time may be assigned to the
Treasurer by the Management Board or the Chief Executive Officer.

         Section 6.8 Secretary. The Secretary shall: (a) keep the minutes of the
Members' and of the Management Board's meetings in one (1) or more books
provided for that purpose and make such minutes available to all Managers during
operating hours of the Company and with reasonable notice; (b) see that all
notices are duly given in accordance with the provisions of this Agreement or as
required by law; (c) be custodian of the corporate records and, if the Company
has a corporate seal, of the seal of the Company and see that the seal of the
Company is affixed to all documents which must be executed under seal; (d) keep
a register of the post office address of each Member which shall be furnished to
the Secretary by such Member; (e) have general charge of the transfer books of
the Company; and (f) in general, perform all duties incident to the office of
Secretary and all other duties as from time to time may be assigned to the
Secretary by the Management Board or the Chief Executive Officer.

         Section 6.9 Assistant Treasurers and Assistant Secretaries. The
Management Board may appoint one (1) or more Assistant Treasurers and Assistant
Secretaries, who shall perform such duties as shall be assigned to them by the
Treasurer or the Secretary, respectively, or by the Management Board or the
Chief Executive Officer.

         Section 6.10 Compensation. The compensation of the officers, if any,
shall be fixed from time to time by the Management Board, and no officer shall
be prevented from receiving

                                       16
<PAGE>   19

such compensation by reason of the fact that he/she is also a Manager, Member or
serves in any other capacity on behalf of the Company.

                                  ARTICLE VII
                                   COMMITTEES

         Section 7.1 Committees of Managers. The Management Board may, to the
extent permitted by law, establish standing and special committees as the
Management Board deems appropriate. Such standing and special committees shall
serve only in an advisory capacity to the Management Board and shall have no
legal authority to act for the Company, but shall report their findings and
recommendations to the Company. Except as otherwise provided in this Agreement,
the Management Board may determine the manner of conducting committee business,
whether at a meeting or otherwise, and the number of committee members required
to take specified types of action.

         Section 7.2 Standing Committees. The Management Board may establish
such standing committees and special committees as the Management Board may from
time to time deem appropriate.

         Section 7.3 Committee Appointments. The Management Board shall appoint
members and the chairman of each committee. The chairman of a committee shall be
a member of such committee. Committees shall meet as frequently as may be
necessary or appropriate to fulfill their assigned duties. Committee chairmen
shall preside at, and shall fix the place, time and date of, committee meetings.
Special committee meetings may be called by or at the request of the chairman of
the committee, the Chief Executive Officer, or a majority of the Managers, upon
proper notice of the same to the members of such committee. Any appointed member
of a committee may be removed therefrom with or without cause by vote of the
Management Board.

         Section 7.4 General Provisions. The minutes and records of the meetings
of each committee shall be kept by a secretary appointed therefor by the
chairman of such committee, and complete copies of such minutes and records
shall be filed promptly with the Secretary. The secretary of each committee
shall in the case of a special meeting of the committee give notice of the
meeting to the members of the committee at least forty-eight (48) hours in
advance in person or by telephone, facsimile, overnight mail or electronic mail
transmission, or at least five (5) days in advance by mail. A committee may at
its first meeting schedule regular meetings to be held during the ensuing year.
A list of regularly scheduled meetings of any committee shall be sent to all
committee members not present at the meeting at which such regular meetings were
scheduled, and no further notice of those meetings shall be required. At a
committee meeting, a quorum shall be a majority of the total number of members
of the committee. When a quorum is present at any meeting, the vote of a
majority of the committee members present and voting may decide any question
brought before the meeting, unless a greater percentage vote is required by this
Agreement or the rules of the committee. A committee may adopt rules and
regulations concerning the conduct of its affairs as it may from time to time
determine to be desirable and which are not inconsistent with this Agreement.
Each member of a committee shall have one (1) vote with respect to matters
before the committee, except where otherwise stated in this Agreement.

                                       17
<PAGE>   20

                                  ARTICLE VIII
                          DISTRIBUTIONS AND ALLOCATIONS

         Section 8.1 Allocation of Net Profits and Net Losses. Except as
provided in Section 8.2, all Company Net Profits and Net Losses shall be
allocated to the Members in proportion to their Percentage Interests.

         Section 8.2 Regulatory Allocations.

              (a) Notwithstanding any provision to the contrary, if in any year
a Member receives (or is reasonably expected to receive) a distribution, or an
allocation or adjustment to such Member's Capital Account, that creates or
increases (or is reasonably expected to create or increase) a deficit balance in
such Member's Capital Account, there shall be allocated to the Member such items
of Company income or gain as are necessary to satisfy the requirements of a
"qualified income offset" within the meaning of Regulation Section 1.704-1(b).

              (b) If there is a net decrease in partnership minimum gain (as
defined in Regulation Section 1.704-2(d)) in any fiscal year of the Company, the
Members shall be allocated items of income and gain for such year (and, if
necessary, for succeeding years) in accordance with the minimum gain chargeback
requirements of Regulation Section 1.704-2(f).

              (c) All Member nonrecourse deductions for each fiscal year of the
Company shall be allocated to the Members who bear the economic risk of loss
with respect to the Member nonrecourse debt giving rise to such deductions, in
accordance with Regulation Section 1.704-2(i)(1). If there is a net decrease in
partner nonrecourse debt minimum gain (as defined in Regulation Section
1.704-2(i)(3)) in any fiscal year of the Company, the Members shall be allocated
items of income and gain for such year (and, if necessary, for succeeding years)
in accordance with the partner nonrecourse debt minimum gain chargeback
requirements of Regulation Section 1.704-2(i)(4).

         Section 8.3 Tax Allocations. Items of taxable income, gain, loss and
deduction shall for federal and state income tax purposes be allocated in the
same manner as "book" items are allocated in Sections 8.1 and 8.2. Items of
taxable income, gain, loss and deduction with respect to property of the Company
which has a Carrying Value different from its adjusted basis for federal income
tax purposes will be shared among the Members so as to take account of such
difference in accordance with the principles of Section 704(c) of the Code.

         Section 8.4 Distributions.

              (a) For purposes of this Agreement, the term "Distributable Cash"
shall mean, all cash receipts of the Company from all sources during the period
(other than capital contributions by the Members), plus the amount of all
reductions during the period in reserves established by the Company in prior
periods, less the sum of:

                  (i) payments of principal and interest on any indebtedness of
the Company;

                                       18
<PAGE>   21

                  (ii) all cash expended for expenses of the Company's business
during the period;

                  (iii) capital expenditures; and

                  (iv) reasonable reserves otherwise required in the discretion
of the Company for the Company's business.

Distributable Cash shall be distributed pursuant to Section 8.6.

              (b) To the extent the Company retains cash receipts, as described
in Section 8.4(a)(iv), for reserves or other business purposes, such cash shall
be referred to as "Accumulated Cash." Accumulated Cash which is distributed to
the Members shall be distributed pursuant to Section 8.6.

         Section 8.5 Asset Policy. The Company's assets will be prudently
controlled within the Company's business plan and budget and the budget
variances set forth therein. Cash and other assets not needed to support the
operation of the Company's business, as described in the most current business
plan and budget, will be liquidated and distributed to the Members pursuant to
Section 8.6.

         Section 8.6 Distributions Among Members. Distributions, including
distributions of Distributable Cash and Accumulated Cash (but other than those
in dissolution made pursuant to Section 12.2), shall be made at times determined
by the Management Board in amounts determined by the Management Board as long as
such amounts are distributed to the Members in proportion to their Percentage
Interests.

                                   ARTICLE IX
                             ADMINISTRATIVE MATTERS

         Section 9.1 Books of Account. At all times the Company shall maintain
or cause to be maintained true and proper books, records, reports and accounts
in accordance with generally accepted accounting principles consistently applied
on an accrual basis, in which shall be entered fully and accurately all
transactions of the Company. The Company shall keep vouchers, statements,
receipted bills and invoices and all other records in connection with the
Company's business.

         Section 9.2 Reports. The officers of the Company shall provide the
Company's Management Board and Members with reports at least annually to keep
them advised of the Company's current and projected operations and financial
condition.

         Section 9.3 Tax Matters Partner. The Management Board shall designate
an existing Manager who shall be the Tax Matters Partner of the Company within
the meaning of Code Section 6231(a)(7); provided, however, that if such person
would not be treated as a party to the proceeding within the meaning of Code
Section 6226(c) and (d) for any taxable year involved in a partnership
proceeding, then the Tax Matters Partner for such year shall be a Manager who is
designated by the Management Board at the time the Notice of Final Partnership
Administrative Adjustment is received who would be treated as a party to the
proceeding for such year.

                                       19
<PAGE>   22

         Section 9.4 Tax Matters Handled By the Company. The Company shall have
full authority to negotiate with, to conclude agreements with or to refuse to
agree with Federal, state, local and foreign taxing authorities as to the
taxable income of the Company for any taxable period and any determination of
such taxable income shall be binding upon the Members each of whom individually
shall be liable to pay any additional tax and interest or entitled to receive
any refund and interest resulting from such determination. The Company shall not
be responsible for any loss or damage to any Member, as a result of any such
determination or failure to arrive at a determination. The Company may also make
such elections, including, without limitation, an election under Section 754 of
the Code, as the Management Board may determine.

         Section 9.5 Fiscal Year. The fiscal year of the Company shall end on
December 31 of each year.

                                   ARTICLE X
              TRANSFER OF INTERESTS/NON-COMPETITION/CONFIDENTIALITY

         Section 10.1 Restrictions on Transfer. Notwithstanding anything to the
contrary in this Agreement, no Member shall Transfer any part or all of such
Member's rights and interests (including, but not limited to such Member's
Capital Account) in the Company ("Company Interests") now owned or hereafter
acquired, whether voluntarily, by operation of law, or otherwise, without the
prior written consent of all of the Members, unless such transfer is made in
accordance with the provisions of this Article X; provided, however, that a
person or entity meeting the eligibility requirements set forth in Section
4.1(b), (c) or (d) may become a Physician Member pursuant to the mechanisms set
forth in Section 4.3.

         Section 10.2 Option and Right of First Refusal Upon Occurrence of a
Triggering Event with Respect to a Physician Member.

              (a) In the event a Triggering Event (as hereinafter defined)
occurs with respect to a Physician Member the following provisions shall apply:

                  (i) The Physician Member with respect to which the Triggering
Event occurred (the "Selling Physician Member") shall notify the Company in
writing of the occurrence of such Triggering Event within five (5) days of the
occurrence of the Triggering Event. Within five (5) days of the Company's
receipt of such written notice of the Triggering Event, the Company shall give
the other Members, meaning all of the Members except the Selling Physician
Member, notice of the Triggering Event. Within forty (40) days after the date of
that notice, the Company shall determine the Value (as hereinafter defined) of
the Company Interests on the date of the Triggering Event and shall give a
notice of such Value (the "Value Notice") to the Members. Within fifteen (15)
days after the date on which the Company delivers the Value Notice, the Members
shall have an option to purchase any or all of the Selling Physician Member's
Company Interests allocated in the manner described in Section 10.3(c).

                  (ii) Each of the purchasing Members shall evidence the
election to purchase by delivering written notice (the "Member Purchase Notice")
to the Company and the Selling Physician Member, specifying the portion of
Company Interests to be

                                       20
<PAGE>   23

purchased. The purchase price for all of the Company Interests shall be
seventy-five percent (75%) of the Value of the Company Interests. The purchase
price any purchasing Member shall pay for the applicable portion of the Company
Interests shall equal seventy-five percent (75%) of the Value of the applicable
portion of the Company Interests being purchased by such Member. The closing of
any Member's purchase of any portion of a Selling Physician Member's Company
Interests shall occur within fifteen (15) days of the date of the applicable
Member Purchase Notice. At such closing, the purchase price shall be paid by
each applicable purchaser, in full, in legal tender of the United States, by
certified check of the purchaser or by official bank check.

                  (iii) At the last closing to occur pursuant to Section
10.2(a)(ii), to the extent any of the Selling Physician Member's Company
Interests remain after the Members exercise their option in Section 10.2(a)(i),
the Company shall have the option to purchase any remaining Company Interests of
the Selling Physician Member at a purchase price equal to seventy-five percent
(75%) of the Value of the remaining Company Interests of the Selling Physician
Member. The Company shall evidence the election to purchase by written notice
(the "Company Purchase Notice") to the Selling Physician Member, specifying the
portion of Company Interests to be purchased. The closing of the Company's
purchase of a Selling Physician Member's Company Interests shall occur within
fifteen (15) days of the date of the Company Purchase Notice. At such closing,
the purchase price shall be paid at the election of the Company, either: (A) in
full, in legal tender of the United States, by certified check of the Company or
by official bank check; or (B) by payment at the closing of not less than
twenty-five percent (25%) of the purchase price and by delivery of a promissory
note having a principal amount equal to the remainder, bearing interest per
annum at the rate quoted on the date of the closing by The Wall Street Journal
as the "Prime Rate," prepayable without penalty, and payable in not more than
thirty-six (36) monthly installments, commencing one (1) month after the date of
the closing.

              (b) "Triggering Event" as used herein means the occurrence of any
of the following: (i) a Physician Member or a principal thereof commits a
Material Breach; (ii) a Physician Member experiences a Change of Control or
dissolves or liquidates; (iii) a Physician Member's or principal thereof's
license to practice medicine in the State of Louisiana is restricted, suspended,
terminated or revoked; (iv) a Physician Member or principal thereof ceases for
any reason to practice medicine in the Practice Area on a full-time basis (i.e.,
at least thirty (30) hours a week, forty-eight (48) weeks per year) or
completely ceases to perform in the Practice Area any surgeries or procedures
for which the Physician Member, or principal thereof, is credentialed/privileged
to perform at the Ambulatory Surgery Center; (v) a Physician Member's or
principal thereof's privileges at any health care entity are restricted,
suspended, terminated or revoked for any reason other than underutilization,
failure to timely complete patient medical records or other reason wholly
unrelated to the quality of patient care; (vi) for any reason the Physician
Member ceases to have active medical staff privileges at the Ambulatory Surgery
Center once it is operational or ceases, prior to the date the Ambulatory
Surgery Center is operational, to have active medical staff privileges at a
hospital located within the Practice Area; (vii) a Physician Member or principal
thereof is found guilty of or pleads nolo contendere to any felony, any crime of
moral turpitude, or any act involving abuse of any patient; (viii) a Physician
Member's or principal thereof's actions or inactions endanger the health, safety
or well being of the Company's patients or employees, as determined by the
Company in its

                                       21
<PAGE>   24

reasonably exercised judgment; (ix) a Physician Member's or principal thereof's
permit or license to dispense or prescribe drugs or controlled substances in the
State of Louisiana is restricted, suspended, terminated or revoked; (x) a
Physician Member's or principal thereof's right to participate in the Medicare
and/or Medicaid programs is restricted, suspended, terminated or revoked; or
(xi) a Physician Member or principal thereof engages in any unlawful harassment,
including without limitation any sexual harassment, of any patient, employee,
agent or independent contractor of the Company.

              (c) "Value" as used herein means the fair market value of the
Company as determined by an independent, licensed appraiser with substantial
experience in making determinations of the fair market value of corporations
that provide ambulatory surgery services with such appraiser being selected by
the Members of the Company whose Company Interests are not being sold, LESS the
cost of such appraisal.

              (d) Notwithstanding anything herein in this Section 10.2 to the
contrary, the Members or the Company, as applicable, shall pay one hundred
percent (100%), not seventy-five percent (75%), of the Value of the applicable
portion of the Company Interests being purchased pursuant to this Section 10.2
if the Triggering Event is due to any of the following:

                  (i) The Selling Physician Member or principal thereof, as
applicable, dies; or

                  (ii) The Selling Physician Member or principal thereof, as
applicable, has a Permanent Disability (as hereinafter defined); the Selling
Physician Member or principal thereof, as applicable, has provided a written
statement from an independent physician who has examined the Selling Physician
Member or principal thereof, as applicable, which confirms that the Selling
Physician Member or principal thereof, as applicable, has a Permanent
Disability; and the Company, at its option, has an independent physician examine
the Selling Physician Member or principal thereof, as applicable, and such
physician confirms that a Permanent Disability exists. In the event that the
independent physician engaged by the Selling Physician Member and the
independent physician engaged by the Company differ in their conclusions as to
whether the Selling Physician Member has a Permanent Disability, then such
physicians shall select a third physician who shall examine the Selling
Physician Member and whose determination shall be conclusive and binding on the
parties to this Agreement as to whether or not the Selling Physician Member has
a Permanent Disability. "Permanent Disability" as such term is used herein means
the Selling Physician Member has a mental or physical illness or disability such
that the physician is unable to practice medicine for an aggregate of thirty
(30) or more consecutive work days or, for a period of forty-five (45) or more
work days in any three hundred sixty-five (365) day period. The Selling
Physician Member shall be responsible, and shall pay, the charges of the
physician engaged by the Selling Physician Member to confirm the Permanent
Disability. If the Company engages an independent physician to confirm the
Permanent Disability, then the Company shall be responsible, and shall pay, the
charges for such physician services. If the physician engaged by the Selling
Physician Member and the physician engaged by the Company need to select a third
physician to confirm the Permanent Disability pursuant to this Section
10.2(d)(ii), then each of the Selling Physician

                                       22
<PAGE>   25

Member and the Company shall be responsible, and shall pay, for fifty percent
(50%) of such third physician's charges for the professional services rendered.

         Section 10.3 Right of First Refusal Upon Proposed Sale of Member's
Company Interests. Any selling Member (the "Transferor") may sell all, but not
less than all, of the Transferor's Company Interests, pursuant to a third-party
cash offer which the Transferor reasonably establishes is bona fide (the
"Offer"), only after the Transferor first gives the other Members and the
Company prior written notice (the "Original Notice") and the rights of first
refusal granted hereunder are not exercised and all other conditions of this
Section 10.3 are met; provided, however, subject only to Section 10.4, any such
proposed sale by a Physician Member may only be to a person or entity that may
be a Physician Member under the requirements of Section 4.1(b), (c) or (d).

              (a) The Original Notice shall state the material terms and
conditions of the proposed sale (including without limitation the purchase
price, the Company Interests to be transferred and the name, business and
residential address of the proposed transferee) and shall have attached any
documentation related to the Offer and the proposed sale.

              (b) Within forty-five (45) days after its receipt of the Original
Notice, the Company shall determine the "Value" (as defined in Section 10.2(c))
of the Company Interests then proposed to be transferred (the "Offered Company
Interests") on the date of the Original Notice and shall give the Transferor and
the other Members written notice thereof (the "Value Notice").

              (c) Within fifteen (15) days after the date of the Value Notice,
the other Members, meaning the Members except the Transferor, may elect to
purchase any or all of the Offered Company Interests. The amount to be purchased
by a specific Member shall not exceed such purchasing Member's pro rata interest
determined with respect to such Member's current Percentage Interests compared
with the other purchasing Members, unless all of the purchasing Members agree to
purchase in different proportions.

              (d) Each of the purchasing Members shall evidence the election to
purchase by written notice (the "Member Purchase Notice") to the Transferor and
the Company, specifying the Company Interests to be purchased. Unless otherwise
agreed upon, the closing shall occur within fifteen (15) days of the date of the
applicable Member Purchase Notice, and the purchase price shall be paid pursuant
to the terms of Section 10.2(a)(ii). The purchase price of the entire Offered
Company Interests shall be the lesser of: (i) the price specified in the
Original Notice; or (ii) the Value of the Company Interests specified in the
Value Notice. Each purchasing Member shall pay its, his or her applicable
portion of such purchase price based on the portion of the Offered Company
Interests being purchased by such Member.

              (e) If the Members do not elect to purchase all of the Offered
Company Interests by the end of the period specified in Section 10.3(c), then,
not later than forty-five (45) days after the date of the Value Notice, the
Company may elect to purchase any remaining portion of the Offered Company
Interests. The Transferor may not be involved in any capacity in the Company's
election. The Company shall evidence its election to purchase by written notice
(the "Company Purchase Notice") to the Transferor specifying its intent to

                                       23
<PAGE>   26

purchase any remaining portion of the Offered Company Interests. Unless
otherwise agreed upon, the closing shall occur within fifteen (15) days of the
date of the Company Purchase Notice, and the purchase price shall be paid
pursuant to the terms of Section 10.2(a)(iii)(A) or (B) hereof, determined at
the election of the Company, and shall be the lesser of the remaining portion of
(i) the price specified in the Original Notice, or (ii) the Value of the Company
Interests specified in the Value Notice.

              (f) If the Members and the Company do not elect to purchase all of
the Offered Company Interests within forty-five (45) days after the date of the
Value Notice, then the Transferor may transfer all of any remaining, but not
less than all of any remaining, Offered Company Interests in accordance with the
Offer, providing the transferee executes the joinder to this Agreement as
described in Section 4.3 herein. Furthermore, if the Transferor is a Physician
Member, then the transferee must also meet the requirements to be a Physician
Member as described in Section 4.1(b), (c) or (d). If the Transferor is the IOI
Member, then the transferee shall be defined as the "IOI Member" hereunder and
all rights and obligations of the IOI Member under this Agreement shall apply
to, and be the rights and obligations of, such transferee (excluding Section
3.1). After seventy-five (75) days from the date of the Value Notice, regarding
any of the Offered Company Interests which have not been transferred, all
restrictions contained in this Agreement again shall apply to such Offered
Company Interests, and any subsequent transfer of Company Interests shall be
made only upon compliance with this Agreement.

              (g) If a Member delivers an Original Notice pursuant to Section
10.3 and a Triggering Event thereafter occurs prior to expiration of the
election periods, then Section 10.2 shall control.

              (h) The foregoing provisions of this Section 10.3 shall be
inapplicable to the extent the Physician Members are selling their "Collective
Physician Interests" pursuant to Section 10.4. Additionally, the foregoing
provisions of this Section 10.3 shall be inapplicable to a sale or exchange of
Company Interests by any Member pursuant to a single offer made to all Members
by: (i) the Company, upon a recapitalization or redemption of Company Interests;
or (ii) any other person(s) or entity, if it thereby acquires all of the
outstanding Company Interests of the Company.

         Section 10.4 Sale of Collective Physician Interests/Drag Along.

              (a) If the holders (the "Approving Physician Members") of at least
fifty-one percent (51%) of the total issued and outstanding Percentage Interests
then held by Physician Members vote to sell to a third party all, but not less
than all, of the Percentage Interests then held by all of the Physician Members
(the "Collective Physician Interests") in a single transaction or a series of
related transactions, then the Approving Physician Members shall deliver a
written notice (the "Collective Sale Notice") to the IOI Member and the
Physician Members (the "Non-Approving Physician Members") who are not Approving
Physician Members which states the material terms and conditions of the proposed
sale (including without limitation the total purchase price, and the name,
business and residence address of the proposed purchaser(s)) and shall have
attached any documentation related to the proposed sale. The

                                       24
<PAGE>   27

Approving Physician Members shall also have an obligation to reasonably
establish to the IOI Member that the third party offer is bona fide.

              (b) Within thirty (30) days after the date of the IOI Member's
receipt of the Collective Sale Notice, the IOI Member may elect to purchase all
of the Collective Physician Interests at the price equal to the lesser of: (i)
the Value of such Collective Physician Interests; or (ii) the price set forth in
the Collective Sale Notice. The IOI Member shall evidence the election to
purchase by delivering written notice to each Physician Manager and to the
Company. If the IOI Member elects to make such purchase, unless otherwise agreed
upon, the closing shall occur within fifteen (15) days after the date of the
delivery of such notice. At such closing, the purchase price shall be paid at
the election of the IOI Member, either: (A) in full, in legal tender of the
United States, by certified check of the IOI Member or by official bank check;
or (B) by payment at the closing of not less than twenty-five percent (25%) of
the purchase price and by delivery of a promissory note having a principal
amount equal to the remainder, bearing interest per annum at the rate quoted on
the date of the closing by The Wall Street Journal as the "Prime Rate,"
prepayable without penalty, and payable in not more than thirty-six (36) monthly
installments, commencing one (1) month after the date of the closing.

              (c) If the IOI Member does not elect to purchase the Collective
Physician Interests within thirty (30) days after the date of the Collective
Sale Notice, then all of the Physician Members shall sell all of their
Percentage Interests according to the terms and conditions set forth in the
offer voted upon by the Approving Physician Members; provided that the sale must
close within sixty (60) days from the date of the Collective Sale Notice and the
purchaser(s) must execute a Joinder. If the purchaser(s) do not constitute
Physician Members as defined in this Agreement, then immediately following such
closing the purchaser(s) and the IOI Member shall amend this Agreement, pursuant
to mutual agreement, in order to resolve the relevant operational issues
affecting the Company. The Approving Physician Members shall arrange for the
proposed purchaser to purchase the Percentage Interests of the Non-Approving
Physician Members according to the same terms and conditions as those set forth
in the Collective Sale Notice. If the sale between the Physician Members and the
third party is not consummated within such sixty (60) day period, then all
restrictions contained in this Agreement shall apply again to the Collective
Physician Interests and any subsequent transfer of Collective Physician
Interests shall be made only upon compliance with this Agreement.

              (d) The restrictions set forth in Section 4.1 shall not apply to
the purchaser(s) of Collective Physician Interests pursuant to this Section
10.4.

         Section 10.5 Self-Referral Legislation. If, in the written opinion of
nationally recognized health care counsel for the Company, it is determined that
more likely than not any federal or state legislation prohibits either: (a) the
Physician Members from referring patients to the Ambulatory Surgery Center; or
(b) the Company from billing for items and services provided to any patients
referred to the Ambulatory Surgery Center by the Physician Members, then the
Company may, in its sole discretion, require each Physician Member to sell and
each Physician Member shall have the right to require the Company or its
designee to repurchase such Physician Member's Company Interests (the "Section
10.5 Repurchase"), as of the latter of the effective date of such federal or
state legislation or the date of such opinion, at a price equal to the greater
of the following: (y) such Physician Member's initial capital contribution to
the Company, plus

                                       25
<PAGE>   28

simple interest from the date of such Physician Member's investment in the
Company at the Treasury Bill one hundred twenty (120) day rate in effect on the
Section 10.5 Repurchase date; or (z) the Value of the Physician Member's Company
Interests. The Company shall pay by cash (including wire transfer) or by
certified check the total purchase price for all the Physician Members' Company
Interests.

         Section 10.6 Change of Law Effecting IOI Member's Ability to Own
Company Interests. Notwithstanding anything herein to the contrary, in the event
that any state or federal laws or regulations, now existing or enacted or
promulgated after the date of this Agreement, are interpreted by judicial
decision, a regulatory agency or nationally recognized health care counsel of
the Company or to the IOI Member to indicate that the IOI Member may not
lawfully be a Member of this Company, the IOI Member may in its sole discretion,
require the Company to purchase, and the Company shall purchase, the IOI
Member's Company Interests (the "Section 10.6 Repurchase"), as of the effective
date of such federal or state law or regulation or interpretation thereof, at a
price equal to the greater of the following: (a) the IOI Member's initial
capital contribution(s) to the Company for the Company Interests being sold,
plus simple interest from the date of such IOI Member's investment(s) in the
Company at the Treasury Bill one hundred twenty (120) day rate in effect on the
Section 10.6 Repurchase date; or (b) the Value of the IOI Member's Company
Interests. The Company shall pay by cash (including wire transfer) or by
certified check the total purchase price for all the IOI Members' Company
Interests.

         Section 10.7 Noncompetition. During the existence of the Company, other
than through the Company, each Member and its Affiliates, shall not, without the
prior written consent of the Management Board, directly or indirectly own,
manage, operate, control or participate in any manner in the ownership,
management, operation or control of, or serve as a partner, employee, principal,
agent, consultant or otherwise with, or have any financial interest in, or aid
or assist any other person or entity in the conduct of any ambulatory surgery
center or any medical practice that provides any physician-office surgery
services or procedures at such practice's facilities that could be performed at
an ambulatory surgery center, where such ambulatory surgery center or medical
practice performs services in the Territory. As indicated above, these
noncompetition provisions shall cease to apply to an individual or entity once
such individual or entity is no longer a "Member" of the Company.
Notwithstanding anything to the contrary in this Section 10.7, the provisions of
this Section 10.7 shall not prohibit a Physician Member and its Affiliates, from
serving as a medical director as long as such Member or Affiliate is not the
medical director of an ambulatory surgery center, outpatient surgery center, or
like type center or department.

         Section 10.8 Nonsolicitation. During the term of this Agreement, and
for a period of two (2) years following a Member's ceasing to be a Member (if
the Company is still operating the Ambulatory Surgery Center during such
period), no Member or principal thereof (if a Member is not an individual) or
Affiliate of such Member or principal shall employ or offer employment to any
person who is employed by the Company during the term of this Agreement, without
the prior written consent of the Company; provided, however, that if an
individual was an employee of the Member or any Affiliate immediately prior to
becoming an employee of the Company, then this nonsolicitation provision shall
not apply to prohibit such individual from resuming employment with such Member
or Affiliate.

                                       26
<PAGE>   29

         Section 10.9 Not Applicable, The restrictions set forth in this Section
10 shall not be deemed to: (i) prevent any Member from acquiring through market
purchases and owning, solely as an investment, less than five percent (5%) in
the aggregate of the equity securities of any class of any issuer whose shares
are listed or admitted for trading on any United States national securities
exchange or are quoted on the National Association of Securities Dealers
Automated Quotations Systems, or any similar system of automated dissemination
of quotations of securities prices in common use, so long as such Member is not
a member of any "control group" (within the meaning of the rules and regulations
of the Securities and Exchange Commission) of any such issuer; or (ii) prohibit
IOI from providing any services to Westside Orthopaedic Clinic, a Louisiana
professional corporation.

         Section 10.10 Third-Party Beneficiaries. All Affiliates of the Company,
and all successors and assigns of such Affiliates, are third-party beneficiaries
of the restrictive covenants contained in this Section 10 and the provisions of
this Section 10 are intended for the benefit of, and may be enforced by any
Affiliates and the successors and assigns of such Affiliates of the Company.

         Section 10.11 Enforcement. In the event any court of competent
jurisdiction shall determine that the scope, time or territorial restrictions
set forth herein are unreasonable, then it is the intention of the parties that
such restrictions be enforced to the maximum scope, duration and territory that
the court deems reasonable, and the Agreement shall thereby be reformed.

         Section 10.12 Confidentiality. Each Member and Manager, and each agent
or principal thereof, shall keep secret and confidential, and agrees to keep
secret and confidential, all information acquired relating to the following (all
such information being hereinafter referred to as "Confidential Business
Information"): (a) the financial condition and other information relating to the
business of the Company, including without limitation, its rates for services,
its operations and contracts, and its business plans and arrangements; (b) the
systems, products, plans, services, marketing, sales, administration and
management procedures, trade relations or practices, techniques and practices
heretofore or hereafter acquired, developed and/or used by the Company; and (c)
in connection with the Company's patients, providers, clients, customers,
suppliers, vendors, lenders, independent contractors, and payors, the provisions
and terms of any agreements or proposed agreements between the Company and any
of such individuals or entities. No Member or Manager shall at any time disclose
any such Confidential Business Information to any person, firm, corporation,
association or other entity, or use the same in any manner other than as
follows: (a) as necessary in connection with operating the business and affairs
of the Company; and (b) by the selling Member(s) to a potential third-party
purchaser pursuant to Section 10.3 or 10.4, if such third party has executed a
confidentiality agreement pursuant to which such third party has agreed to keep
the Confidential Business Information strictly confidential and a copy of such
confidentiality agreement was delivered to the Company prior to such disclosure.
Notwithstanding the foregoing, the term "Confidential Business Information"
shall not include the following: (v) any information which was independently
developed by a party without the use of the Confidential Business Information;
(w) any information which is or becomes available in the public domain during
the term of this Agreement; (x) any information which is ordered to be released
by requirement of a governmental agency or court of law; (y) any information
provided to a party's professional advisers (i.e., attorneys and accountants);
and (z) any information independently made lawfully

                                       27
<PAGE>   30
available to a party as a matter of right by a third party. Each Member and
Manager agrees that these confidentiality covenants shall apply while an
individual or entity is a Member or Manager and also at all times thereafter. No
Member or Manager shall under any circumstances use such Confidential Business
Information in any way reasonably perceived as detrimental to the Company.

                                   ARTICLE XI
                                 INDEMNIFICATION

         Section 11.1 Indemnification.

              (a) To the extent not covered by a policy of insurance covering
such Member, each of the Members agrees to indemnify, defend and hold harmless
each other and the Company from and against all loss, damage (including
incidental and consequential damages), expense (including court costs,
reasonable attorneys' fees at all levels of trial and appeal, interest expenses
and amounts paid in compromise or settlement), suits, actions, claims,
penalties, liabilities or obligations related to, caused by or arising from or
on account of:

                  (i) any breach of any representation or warranty made by it
herein or in any of the other agreements executed in connection herewith;

                  (ii) any failure by it to fulfill any agreement or covenant
made pursuant to this Agreement or any other agreements executed in connection
herewith;

                  (iii) any debt, obligations, responsibility or liability of it
which is not to be shared pursuant to the terms of this Agreement or any other
agreements executed in connection herewith; or

                  (iv) any error, omission or fault of such Member, its
employees, agent or contractors.

              (b) Each Member's indemnification obligations under this Section
11.1 shall survive the termination of this Agreement.

              (c) If the Management Board, the Management Board committees, the
officers, employees and/or agents of the Company are not covered by a policy of
insurance, then the Company shall indemnify, defend and hold harmless any of
same to the fullest extent permissible under Delaware law.

              (d) The right to indemnification and the payment of expenses
incurred in defending a proceeding in advance of its final disposition conferred
in this Article XI shall not be exclusive of any other right which any person
may have or hereafter acquire under any statute, provision of the Certificate of
Formation, provision of this Agreement, vote of Members or otherwise.

              (e) The Company may maintain insurance, at its expense, to protect
itself and any Member, the Management Board, Management Board committees,
officer, employee or agent of the Company against any expense, liability or
loss, whether or not the

                                       28
<PAGE>   31

Company would have the power to indemnify such person against such expense,
liability or loss under Delaware law.

              (f) Any amendment, repeal or modification of any provision of this
Article XI shall not adversely affect any right or protection of a Member, the
Management Board, Management Board committee, officer, employee or agent of the
Company existing at the time of such amendment, repeal or modification.

                                   ARTICLE XII
                                   DISSOLUTION

         Section 12.1 Events of Dissolution. The Company shall be dissolved upon
the earliest to occur of the following:

              (a) pursuant to Section 5.15;

              (b) when the Company is declared bankrupt;

              (c) the sale of all or substantially all of the assets of the
Company; or

              (d) the determination by the Management Board that the Company's
business can no longer be operated in compliance with any applicable health care
or other law, regulation or policy, subject to Section 10.5 and Section 10.6.

         Section 12.2 Winding Up. Unless otherwise agreed by the Members, at the
time of liquidation, any property owned by the Company shall be sold for cash,
and each Member shall have the right to bid competitively for any such asset
being sold. Any cash received from the sale of the Company's assets shall be
used first to pay the Company's debts to creditors other than the Members;
provided, however, for this purpose, a Member which is owed money for goods or
services provided to the Company shall be deemed an unrelated creditor. Any cash
remaining after payments to creditors shall be used to repay other debts to
Members. Once all Member debt is repaid, the remaining cash received from the
sale of the Company's assets shall be distributed to the Members in proportion
to their positive Capital Account balances (after giving effect to adjustments
to Capital Accounts through the date of distribution).

                                  ARTICLE XIII
                                  MISCELLANEOUS

         Section 13.1 Amendment. This Agreement may be amended only with the
approval of the holders of fifty-one percent (51%) of the Physician Member
Percentage Interests and the consent of the IOI Member (See Section 5.15(i)).

         Section 13.2 Waiver. Any waiver of any of the terms hereof shall be
effective only for the instance for which it is given and shall not constitute a
waiver of a subsequent occurrence or of any other provision hereof.

         Section 13.3 Notices. All notices, requests, demands and other
communications made with respect to this Agreement or any other agreements
executed in connection herewith shall be

                                       29
<PAGE>   32

in writing, and personally delivered, sent by registered or certified mail
(postage prepaid), by facsimile or by prepaid carrier service, and shall be
deemed to be effective on the day that such writing is delivered if given by
personal delivery or prepaid carrier services, or if sent by registered or
certified mail, five (5) days after being deposited in the mails, or upon
receipt of confirmation if sent by facsimile, in accordance with the provision
of this Section 13.3. All such notices shall be addressed as follows:

         If to:            The IOI Member

                           IOI Management Services of Louisiana, Inc.
                           5858 Westheimer Drive, Suite 500
                           Houston, Texas  77057
                           Facsimile: 713-361-2000
                           Attention: Douglas P. Badertscher

or to such other address as may be specified in a notice given in accordance
with this Section 13.3.

         Section 13.4 Binding Agreement. This Agreement shall be binding upon
the executors, administrators, estates, heirs and legal successors of the
parties hereto.

         Section 13.5 Governing Law. This Agreement and all questions arising
hereunder shall be determined in accordance with the law of Delaware. Venue for
any actions arising hereunder shall be in Jefferson Parrish, Louisiana.

         Section 13.6 Severability. If one or more provisions in this Agreement
is held or found to be invalid, illegal or unenforceable in any respect, the
provision(s) shall be given effect to the extent permitted by law and the
invalidity, illegality or unenforceability shall not affect the validity of the
remaining provisions of this Agreement.

         Section 13.7 Counterparts. This Agreement may be executed in several
counterparts, and all so executed shall constitute one agreement, binding on all
of the parties hereto, notwithstanding that all of the parties are not
signatories to the original or the same counterpart.

         Section 13.8 Entire Agreement. This Agreement is intended by the
Members to constitute the "limited liability company agreement" of the Company
within the meaning of Section 1-5 of the Act. This Agreement contains the entire
understanding among the Members. This Agreement supersedes any prior written or
oral agreement between the Members with respect to the subject matter hereof.
This Agreement shall be considered as drafted equally by the Members and any
ambiguity shall not be construed against any Member.

         Section 13.9 Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning thereof.

                                       30
<PAGE>   33

         The undersigned Initial Member of the Company has entered into and
executed this LIMITED LIABILITY COMPANY AGREEMENT as of the Effective Date.

                                   IOI MEMBER:

                                   IOI MANAGEMENT SERVICES OF
                                   LOUISIANA, INC., a Louisiana corporation

                                   By:      /s/ DOUGLAS BADERTSCHER
                                      -----------------------------------------
                                   Print Name:  Douglas Badertscher
                                              ---------------------------------
                                   Print Title: Chief Operating Officer
                                               --------------------------------

                                       31

<PAGE>   34

                                   EXHIBIT 4.3

                              JOINDER OF MEMBER TO
                     WESTBANK AMBULATORY CARE CENTER, LLC'S
                       LIMITED LIABILITY COMPANY AGREEMENT

         By affixing his, her or its, as applicable, signature hereto, the
undersigned, as a Member of Westbank Ambulatory Care Center, LLC, a Delaware
limited liability company (the "Company"), hereby joins in the execution of the
Westbank Ambulatory Care Center, LLC Limited Liability Company Agreement (the
"LLC Agreement"), executed by the Company and its Initial Member (as defined in
the LLC Agreement). Upon acceptance of this Joinder by the Company, the
undersigned shall be a party to the LLC Agreement.

         The execution of this Joinder shall be a counterpart execution of the
LLC Agreement, and the undersigned agrees to be bound by all the terms thereof
as though he, she or it, as applicable, were an original party thereto.

         IN WITNESS WHEREOF, the undersigned has executed this Joinder as of
this __ day of _________, ____.

<TABLE>
<CAPTION>
If Member Is A Business Entity                       If Member is An Individual Physician:
------------------------------                       ------------------------------------
<S>                                                  <C>
                                            ,
--------------------------------------------
a                                                    Signature:
  ------------------------------------------                   ---------------------------------------
                                                                             Individually
By:                                                  Print Name:
   -----------------------------------------                    --------------------------------------
Print Name:                                          Address:
           ---------------------------------                 -----------------------------------------
Title:
      --------------------------------------                 -----------------------------------------

                                                             -----------------------------------------
Designated Individual Physician
Bound as "Principal" and "Member"
to LLC Agreement

Signature:
          ----------------------------------
                     Individually
Print Name:
           ---------------------------------
Address:
        ------------------------------------

        ------------------------------------

        ------------------------------------
</TABLE>

<PAGE>   35

         The undersigned hereby accepts this Joinder, and accordingly,__________
_________ is accepted as a Member of the Company.

                                   Westbank Ambulatory Care Center, LLC,
                                   a Delaware limited liability company

                                   By:
                                      -----------------------------------------
                                   Print Name:
                                              ---------------------------------
                                   Print Title:
                                               --------------------------------

                                       2

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