Please note: I want to direct my question to someone that specializes in contract
Partners A and B want to open a medical facility.
Partner A and Partner B are 50/50 partners and set up a health management Co. (HMC) exclusively to manage said medical practice
Partner B is a Dr. and Partner A is not.
The HMC funds the creation of the medical practice with over 200K (100K-each partner).
Partner A was responsible for all accounting (payroll, billing, payables etc) and HR issues.
Partner B is charged with all other facets of the medical practice such as:
1. Finding the space 2. Signing the lease (personal) 3. Acting as general contractor
4. Hiring contractors, staff (including Drs.) 5. Buying equipment and supplies 6. implementing a template for the running of the practice.
A pyramid is set up so the HMC provides all services (to run the practice) and receives management fees equal to all of the profits of the medical practice. The HMC then makes 50/50 distributions to Partner's A and B.
Partner A designates a Dr. as the "Owner-Dr." of the practice.
Recently Partner A sold their 50% of the HMC to a third party. Partner B subsequently bought this same 50% from this third party. Partner B is therefore the sole owner of the HMC. and continues to run the medical practice.
The problem has to do with the previously appointed "Owner-Dr."
Please note the "Owner-Dr." never materially participated in the practice! She never wrote a check, bought any supplies or treated any patients.
"Owner-Dr." and Partner A had several agreements in place.
A. Purchase Agreement- "Owner-Dr." bought the practice for $300 from the previous "Owner-Dr." Specifically it is stated that the seller "Owner-Dr." had a marketable interest which was not ownership interest.
B. Stock Pledge Agreement-Owner-Dr. pledges to grant a security interest to Partner A in order to secure owner's obligations under such guaranty. "Guaranteed Obligations" to the extent of the business collateral
Management Service Agreement (MSA)-basically states that the practice is under the direct supervision of the medical director (Partner B). In addition, "the Practice shall pay the HMC a fee in the amount equal of the Practice Net Collections. There is also a Promissory Note secured by a lien on the practice assets which is held by the HMC.
Now, although Partner B owns the HMC, has de-facto total control of the Medical Practice and a pri***** *****en secured by the Practice Assets against "Owner-Dr., "Owner-Dr." is asking to be bought out. Frankly I don't think she is entitled to one red cent.
The agreements between her and Partner A (subsequently declared bankruptcy
of their LLC
entity) only states that she has a "marketable interest." This marketable interest is undefined. It has been suggested by a non-attorney that she only really owns the name of the Practice entity and not the business. What do you opine?