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L. Furnish the Owner for its approval, during the
fourth quarter of each fiscal year, the operating
budget and capital expenditure budget of the Center for
the next fiscal year.
Under the management contract, SCA Management is entitled to
receive a monthly management fee equal to 6 percent of gross
revenues, defined as the net collectable portion of revenues
billed as fees or other charges arising out of the operation of
the Surgery Center, with no deduction for bad debts. In
addition, SCA Management is entitled to be reimbursed for direct
expenses incurred in managing the Surgery Center. The Operating
Partnership is required to approve any single expense in excess
of $5,000.
The term of the management contract is equal “to the term of
any indebtedness, lease or other obligation of the * * *
[Operating Partnership] guaranteed by SCA or an affiliate of SCA
but not less than 15 years.” The management agreement is
renewable by SCA Management at its option for two 5-year terms.
Except for circumstances involving bankruptcy or insolvency, the
management contract is terminable by the Operating Partnership
only if SCA Management breaches the agreement, and then generally
only after a 90-day notice and 90-day cure period.
Managing Directors of the General Partnership
As indicated in paragraph 4 of the General Partnership
agreement, supra, overall management of the General Partnership,
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