- 46 -
acrimonious, according to the testimony of participants. It is
clear from this testimony that the SWMG physicians negotiated
aggressively for the best terms they could get. The intensity of
the negotiations is reflected in the written agreements, which
were amended late in the discussions to increase the percentages
of net revenue that were to be paid to the SWMG physicians for
given categories of revenue. Significantly, an official of SMF
who participated in the negotiations testified that SMF not only
"could not" pay anything for the SWMG physicians' intangibles but
"would not", explaining that SMF's refusal to pay any cash for the
intangibles was based both on the possible legal proscriptions and
on SMF's unwillingness to pay anything for the intangibles
because, according to SMF's financial projections, to do so would
render the transaction financially infeasible for SMF. In sum,
the SWMG physicians extracted from SMF all that SMF believed it
could provide if the affiliation with the physicians were to
remain economically viable.
The consideration received in the transaction by petitioners
and the other SWMG physicians included: (1) Employment, with
compensation to their medical group set at a minimum of 47 to
57.75 percent of net revenues with a guaranteed floor, (2) a
$35,000 "Physician Access Bonus" for each physician, (3) rights to
participate in the management of SMF; (4) greater professional
autonomy than was perceived to be available from other potential
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