July 30, 2002 Ms. Isabel M. Diaz 6925 Veronese Street Coral Gables, Florida 33314 Dear Isa: Reference is made to the letter agreement between you and Ramsay Youth Services, Inc. (then known as Ramsay Health Care, Inc) dated October 1, 1997 relating to...

                                                                    EXHIBIT 10.5

                           RAMSAY YOUTH SERVICES, INC.
                                 Columbus Center
                               Xxx Xxxxxxxx Xxxxx
                                    Xxxxx 000
                           Xxxxx Xxxxxx, Xxxxxxx 00000





                                  July 30, 2002



Xx. Xxxxxx X. Xxxx
0000 Xxxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxxxxxx  00000

Dear Isa:

                  Reference is made to the letter agreement between you and
Ramsay Youth Services, Inc. (then known as Ramsay Health Care, Inc) dated
October 1, 1997 relating to your employment with the Company (the "Employment
Agreement").

                  This will confirm that, effective as of the close of business
on June 30, 2002, your annual base salary shall be increased to $185,000 and
your position shall be Executive Vice President - Corporate Relations, reporting
to the President and Chief Executive Officer of the Company. All other terms of
the Employment Agreement continue in full force and effect.

                  Please acknowledge your acceptance of and agreement with the
foregoing by signing the enclosed counterpart of this letter, whereupon this
shall constitute an amendment to the Employment Agreement.

                                       Sincerely yours,

                                       /s/ XXXX X. XXXXXX
                                       -------------------------------------
                                       Xxxx X. Xxxxxx
                                       President and Chief Executive Officer

Accepted and Agreed:



/s/ XXXXXX X. XXXX
------------------------------------
    Xxxxxx X. Xxxx