REDLANDS SURGICAL SERVICES - Page 26




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                    k.   Approving any obligations for repairs, equipment,            
               additions, or betterments to the Surgery Center;                       
                    l.   Approving any lease or contractual obligations               
               requiring payments in excess of $50,000 in the aggregate for           
               any twelve-month period or those obligations not in the                
               ordinary course of business; and                                       
                    m.   Approving any obligation to a related party in               
               excess of $5,000.                                                      

          Quality Assurance Agreement                                                 
               Paragraph 13 of the General Partnership agreement, supra,              
          requires SCA Management to enter into a quality assurance                   
          agreement with RHS whereby RHS will agree to perform “certain               
          managerial and supervisory quality assurance duties” in                     
          connection with the operation of the Surgery Center.  The General           
          Partnership agreement provides that the quality assurance                   
          agreement is to continue from year to year unless terminated by             
          either of the parties.                                                      
               Effective April 30, 1990, SCA Management and RHS entered               
          into a quality assurance agreement.  The agreement states that              
          SCA Management “retains RHS for the purpose of the management and           
          supervision of quality assurance programs for the [Surgery]                 
          Center and [to] oversee its affairs, and for providing additional           
          services as SCA [Management] may reasonably request.”                       







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Last modified: May 25, 2011