EXHIBIT 2.2
MEDPARTNERS, INC.
0000 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxxxxxx, Xxxxxxx 00000
March 11, 1999
Team Health Holdings, L.L.C.
c/o Madison Dearborn Capital Partners II, L.P.
Three First National Plaza, Suite 3800
Xxxxxxx, Xxxxxxxx 00000
Re: Recapitalization Agreement
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Ladies and Gentlemen:
Reference is made to the Recapitalization Agreement (the "Agreement"),
dated as of January 25, 1999, by and among Team Health, Inc., a Tennessee
corporation, Pacific Physician Services, Inc., a Delaware corporation,
MedPartners, Inc., a Delaware corporation, and Team Health Holdings, L.L.C., a
Delaware limited liability company. Capitalized terms used but not defined
herein have the meanings accorded to such terms in the Agreement.
The parties to this letter agreement hereby agree to modify the
Agreement as follows:
1. Baseline Capital Expenditures Amount. The definition of
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"Baseline Capital Expenditures Amount" is hereby amended to mean $13,000,000.
2. Indebtedness Amount. Clause (ii) of the definition of
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"Indebtedness Amount" is hereby amended to read as follows: "(ii) the aggregate
amount of Earn-Out Obligations included as Indebtedness shall be deemed to be
$17,487,000, regardless of the actual book value or expected value of the Earn-
Out Obligations at such time."
3. TH Entities. Team Health Rehab & Therapeutic Services, Inc.;
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EMZA, Inc.; Northwest Emergency Physicians, a California partnership; and St.
Mary's South Family Health Center Joint Venture are not TH Entities.
4. Contracts. Neither the Existing Stockholder nor the Parent shall
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be responsible pursuant to Section 8.2 of the Agreement to indemnify the
Purchaser Parties or hold them harmless from and against or pay on behalf of or
reimburse such Purchaser Parties (or make any contribution thereto) in respect
of any Loss which any Purchaser Party may suffer, sustain, or become subject to,
as a result of or relating to any matter described on the Contracts Schedule
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section of the Disclosure letter Update, dated March 11, 1999.
Team Health Holdings, L.L.C.
March 11, 1999
Page 2
5. California Issue. Section 8.2(a) of the Agreement is hereby
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amended to include the following language as a new clause (ix) thereto: "(ix)
the assumption of control of MedPartners Provider Network, Inc., a California
health care service plan licensed under the Xxxx-Xxxxx Health Care Service Act
of 1975 ("MPN"), by the California Department of Corporations, the appointment
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of a conservator to manage MPN, the bankruptcy or insolvency of MPN, and/or any
filing of any petition with respect thereto."
6. Insurance. The Parent and the Existing Stockholder agree to pay
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when due all premiums with respect to the Doctors Companies insurance coverage
referenced on Exhibit L to the Agreement and agrees that if it does not do so,
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the Company may make such payments at its discretion, and take such payments
into account in determining the amounts payable between the parties after the
Closing pursuant to Section 2.6 of the Agreement.
7. Full Force. Except as expressly modified and superseded hereby,
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the Agreement does and will remain in full force and effect.
* * * * *
Team Health Holdings, L.L.C.
March 11, 1999
Page 3
Very truly yours,
MEDPARTNERS, INC.
By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
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Its: Executive Vice President and
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Chief Financial Officer
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PACIFIC PHYSICIAN SERVICES, INC.
By: /s/ Xxxxx X. Xxxxxxxxx, Xx.
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Its: Vice President
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Accepted and Agreed:
TEAM HEALTH, INC.
By: /s/ H. Xxxx Xxxxxxxxxx
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Its: President
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TEAM HEALTH HOLDINGS, L.L.C.
By: /s/ H. Xxxx Xxxxxxxxxx
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Its: President
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