INTERIM SERVICE AGREEMENT

 CONFIDENTIAL TREATMENT REQUESTED

INTERIM SERVICE AGREEMENT

By and Between

PROMEDCO OF ABILENE, INC.

and

ABILENE DIAGNOSTIC CLINIC, P.L.L.C.

                                Table of Contents
                                                                       Page No.
INTERIM SERVICE AGREEMENT................................    1
RECITALS.................................................    1
1 - RESPONSIBILITIES OF THE PARTIES......................    1
1.1  General Responsibilities of the Parties.............    1
1.2  ADC's Matters.......................................    2
1.3  Patient Referrals...................................    2

2. POLICY COUNCIL........................................    2
2.1  Formation and Operation of the Policy Council.......    2
2.2  Duties and Responsibilities of the Policy Council...    2

3. OBLIGATIONS OF PROMEDCO...............................    4
3.1  Management and Administration.......................    4
3.2  Administrator.......................................    7
3.3  Expansion of Clinic.................................    8
3.4  Events Excusing Performance.........................    8
3.5  Compliance With Applicable Laws.....................    8

4.  OBLIGATIONS OF ADC...................................    8
4.1  Professional Services...............................    8
4.2  Employment Of Physician Employees...................    9
4.3  Non-Clinic Expenses.................................    9
4.4  Medical Practice....................................    9
4.5  Professional Insurance Eligibility..................    9
4.6  Employment Of Non-Physician Employees...............    9
4.7  Events Excusing Performance.........................    9
4.8  Compliance With Applicable Laws.....................    9
4.9  Restrictions on Use of Clinic Facility..............    10
4.10 ADC Employee Benefit Plans..........................    10
4.11 Physician Powers of Attorney........................    10
4.12 Spokesperson........................................    10
4.13 Delegation of ADC Responsibilities..................    10

5. RECORDS...............................................    10
5.1  Patient Records.....................................    10
5.2  Other Records.......................................    11
5.3  Access to Records...................................    11

6.  FACILITIES TO BE PROVIDED BY PROMEDCO................    11
6.1  Facilities..........................................    11
6.2  Use of Facilities...................................    11

7. FINANCIAL ARRANGEMENTS................................    11
7.1  Payments to ProMedCo................................    11
7.2  Clinic Expenses.....................................    11
7.3  Accounts Receivables................................    12

8.  INSURANCE AND INDEMNITY..............................    12
8.1  Insurance to Be Maintained by ProMedCo..............    12
8.2  Insurance to be Maintained by ADC...................    12
8.3  Taff Insurance Coverage.............................    12
8.4  Additional Insured..................................    12
8.5  Indemnification.....................................    13

9. RESTRICTIVE COVENANTS AND LIQUIDATED DAMAGES..........    13
9.1  Restrictive Covenants by ADC........................    13
9.2  Restrictive Covenants By Current Physician Members
      and Physician Employees............................    13
9.3  Restrictive Covenants By Future Physician
      Employees..........................................    14
9.4  Physician Shareholder and Physician Employee
      Liquidated Damages.................................    14
9.5  Enforcement.........................................    14
9.6  Temination of Restrictive Covenants.................    15

10.  TERM; RENEWAL; TERMINATION..........................    15
10.1  Effect of Execution................................    15
10.2  Term and Renewal...................................    15
10.3  Extension Period...................................    15
10.4  Termination by ADC.................................    15
10.5  Termination by ProMedCo............................    16
10.6  Actions After Termination..........................    16

I I - DEFINITIONS
11.1  Net Clinic Revenues................................    17
11.2  Dignbution Funds...................................    17
11.3  ProMedCo Distribution..............................    17
11.4  Clinic.............................................    17
11.5  Clinic Facility....................................    17
11.6  Clinic Expenses....................................    17
11.7  Clinic Expenses shall not include..................    18
11.8  Risk Pool Surpluses................................    19
11.9  Risk Pool Cost of Care.............................    19
11-10 Opening Balance Sheet..............................    19
11-11 Technical Employees................................    19
11.12 Physician Members..................................    19
11.13 Physician Employees................................    19
11.15 ADC Employees......................................    19
11-16 Adjustments........................................    19

12.  GENERAL PROVISIONS..................................    20
12.1  Independent Contractor.............................    20
12.2  Other Contractual Arrangement......................    20
12.3  Proprietary property...............................    20
12.4  Cooperation........................................    21

12.5  Licenses, Permits and Certificates.................    21
12.6  Compliance with Rules, Regulations and Laws........    21
12.7  Generally Accepted Accounting Principles (GAAP)....    21
12.8  Notices............................................    21
12.9  Attorneys' Fees....................................    21
12.10 Severability.......................................    22
12.11 Arbitration........................................    22
12.12 Construction of Agreement..........................    22
12.13 Assignment and Delegation..........................    22
12.14 Confidentiality....................................    22
12.15 Waiver.............................................    22
12.16 Headings...........................................    23
12.17 No Third Party Beneficiaries.......................    23
12.18 Time is of the Essence.............................    23
12.19 Modifications of Agreement for
         Prospective Legal Events........................    23
12.20 Whole Agreement; Modification......................    23

INTERIM SERVICE AGREEMENT

         This Interim Service  Agreement  ("Agreement")  dated as of January 19,
1996, between ProMedCo of Abilene, Inc., a Texas corporation  ("ProMedCo") which
is an affiliate of ProMedCo,  Inc., a Texas  corporation  ("Parent") and Abilene
Diagnostic  Clinic,  P.L.L.C.,  a Texas  professional  limited liability company
("ADC").

                                    RECITALS:

         WHEREAS,  ADC is a  multi-specialty  group medical practice in Abilene,
Texas which provides professional medical care to the general public;

         WHEREAS,  ProMedCo is in the business of owning  certain  assets of and
managing and  administering  medical  clinics,  and  providing  non-professional
support  services  to  and  furnishing  medical  practices  with  the  necessary
facilities, equipment, personnel, supplies and support staff;

         WHEREAS,  Abilene  Diagnostic Clinic  Associates,  P.A. ("PA"), a Texas
professional  association,  has  previously  entered into that certain  Practice
Management  Agreement  dated as of October 13, 1993,  with  Southwestern  Health
Development  Corporation  ("  SHDC  ")  and  that  certain  Practice  Management
Agreement  dated the 20th day of June,  1994,  with Abilene  Medical  Management
Services ("AMMS") (collectively the "Hospital Agreements") whereby SHDC and AMMS
provide certain clerical, medical records, billing and collection, receptionist,
transcription, and switchboard services to PA;

         WHEREAS,  ADC desires and intends to assume the Hospital Agreements and
to be bound by the terms of the Hospital Agreements and that ProMedCo intends to
enter  into  this  Agreement  subject  to the  Hospital  Agreements  and  not to
interfere with the Hospital Agreements; and

         WHEREAS,  subject to the terms and  conditions  hereof,  ADC desires to
engage ProMedCo to provide to ADC management  services,  facilities,  personnel,
equipment and supplies  necessary to operate the clinic (as defined  herein) and
ProMedCo desires to accept such engagement;

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, ADC and ProMedCo hereby agree as follows:

                       1. RESPONSIBILITIES OF THE PARTIES

1.1 General  Responsibilities  of the Parties.  ProMedCo  shall provide ADC with
offices, facilities,  equipment,  supplies,  non-professional support personnel,
and management and financial advisory services. ADC shall be responsible for the
recruitment and hiring of physicians, Technical Employees and all issues related
to patient care and documentation thereof.

ProMedCo   shall  neither   exercise   control  over  nor  interfere   with  the
physician-patient  relationship,  which shall be maintained strictly between the
physicians of ADC and their patients.

         1.2 ADC's  Matters.  ADC shall  maintain sole  discretion and authority
over the financial  matters relative to it's own professional  limited liability
company.  It shall set compensation  levels for ADC Employees.  ADC will also be
responsible for all other matters pertaining to the operation of ADC.

         1.3 Patient  Referrals.  The parties  agree that the benefits to ADC do
not require,  are not payment for,  and are not in any way  contingent  upon the
admission,  referral or any other  arrangement  for the provision of any item or
service  offered  by  ProMedCo  to any of  ADC's  patients  in any  facility  or
laboratory controlled, managed or operated by ProMedCo.

2.       POLICY COUNCIL

         2.1  Formation and Operation of the Policy  Council.  A Policy  Council
will be established which shall be responsible for the major policies which will
serve as the basis for  operations  of the  clinic  (the  "Clinic").  The Policy
Council shall consist of eight (8) members.  ProMedCo shall  designate,  at it's
sole  discretion,  four (4)  members  of the  Policy  Council.  ADC at it's sole
discretion shall designate four (4) members. Members of the Policy Council shall
be entitled to attend and vote by proxy at any meetings of the Policy Council so
long as at least one such  representative  from each party is present in person.
Except as may otherwise be provided, the act of a majority of the members of the
Policy Council shall be the act of the Policy Council.

         2.2 Duties and  Responsibilities of the Policy Council.  Subject to the
terms of the Hospital  Agreements,  the Policy  Council shall have the following
duties and responsibilities:

         2.2.1  Physician  Hiring.  The Policy  Council,  with  information  and
analysis provided by ProMedCo, shall determine the number and type of physicians
and Physician  Extenders required for the efficient  operation of the Clinic and
ADC  shall  determine  the  individual  physicians  to be  hired  to  fill  such
positions.  The  approval  of the  Policy  Council  shall  be  required  for any
variations to the restrictive covenants in any physician employment contract.

         2.2.2         Patient Fees.  As a part of the annual operating budget,
in consultation with ADC and ProMedCo, the Policy Council shall review
and adopt the fee schedule for all physician and ancillary services
rendered by the Clinic.

         2.2.3 Administrator.  The selection,  retention, and termination of the
Administrator  pursuant to Section 3.1 shall be the responsibility of the Policy
Council.  If either  party is  dissatisfied  with the  services  provided by the
Administrator,  it shall  refer the  matter to the  Policy  Council.  The Policy
Council  shall  in  good  faith   determine   whether  the  performance  of  the
Administrator  could  be  brought  to  acceptable  levels  through  counsel  and
assistance,  or  whether  the  Administrator  should be  terminated.  The Policy
Council shall be responsible for approving and

amending the Employment Agreement of the Administrator.

         2.2.4 Ancillary Services.  The Policy Council shall approve Clinic
provided ancillary services based upon the pricing, access to and quality
of such services.

         2.2.5 Provider and Payor  Relationships.  The Policy Council shall have
responsibility regarding the establishment and maintenance of relationships with
institutional  health care  providers  and payors.  The Policy  Council shall be
responsible  for approving the  allocation of capitation  risk pools between the
professional  and  institutional   components  of  these  pools  to  the  extent
applicable  under a payor  agreement.  ProMedCo and ADC shall use actuarial data
from a nationally  recognized  actuarial firm as agreed to by both parties,  for
the purposes of  allocating  capitation  funds for those  professional  services
provided directly by ADC.

         2.2.6 Capital  Improvements  and  Expansion.  The Policy  Council shall
determine the priority for any  renovation,  expansion plans and major equipment
expenditures  with  respect  to the  Clinic  based  upon  economic  feasibility,
physician support,  productivity and market conditions.  Final  authorization of
capital expenditures shall require the approval of ADC.

         2.2.7 Annual Budgets. All annual capital and operating budgets prepared
by  ProMedCo,  as set forth in  Section  3 and  employing  ProMedCo's  financial
expertise,  shall be subject to the review and  approval of the Policy  Council,
provided, however, ProMedCo shall have final approval of any capital required by
ProMedCo.

         2.2.8 Strategic Planning.  The Policy Council, with the assistance
of ProMedCo, shall develop long-term strategic planning objectives.

         2.2.9  Exceptions  to  Inclusion  in the Net Revenue  Calculation.  The
exclusion of any revenue from Net Revenue,  including any medical director fees,
whether  now or in the  future,  shall be subject to the  approval of the Policy
Council.

         2.2.10  Advertising.  All  advertising  and  marketing  of the services
performed at the Clinic shall be subject to the prior review and approval of the
Policy Council,  in compliance  with  applicable laws and regulations  governing
professional advertising and in accordance with the standards and medical ethics
of the American Medical Association and the Texas Medical Association.

         2.2.11  Grievance  Issues.  Subject to the provisions of Section 1.2 of
this  Agreement,  the Policy  Council  shall  consider and make final  decisions
regarding  grievances  pertaining to matters not specifically  addressed in this
Agreement as referred to it by ADC or ProMedCo.

         2.2.12 Amendment of Hospital Agreements.  The Policy Council shall
approve any amendments to either of the Hospital Agreements.

3. OBLIGATIONS OF PROMEDCO

         Subject  to the terms of the  Hospital  Agreements,  during the term of
this Agreement,  ProMedCo shall provide or arrange for the services set forth in
this  Section 3, the cost of all of which shall be included in Clinic  Expenses.
ProMedCo is hereby  expressly  authorized  to perform  its  services in whatever
manner it deems reasonably appropriate,  in accordance with policies approved by
the Policy  Council,  and  including  without  limitation,  performance  of some
functions at  locations  other than the Clinic  Facility.  ADC will not act in a
manner  which  would  prevent  ProMedCo  from  efficiently  managing  the Clinic
Facility  operations  in  accordance  with the terms of this  Agreement  and the
policies of the Policy Council. ADC, through its ADC Employees, will provide all
medical services.  ProMedCo will have no authority,  directly or indirectly,  to
perform,  and will not perform  any medical  function.  ProMedCo  may,  however,
advise ADC as to the relationship  between its performance of medical  functions
and the overall administrative and business functioning of the Clinic.

3.1  Management  and  Administration.  Subject  to the  terms  of  the  Hospital
Agreements,  ADC hereby appoints  ProMedCo as the sole and exclusive manager and
administrator  of all  non-medical  functions  and  services  related  to  ADC's
services at the Clinic.  ADC shall  perform all medical  services,  and ProMedCo
shall have no  authority,  directly  or  indirectly,  to  perform,  and will not
perform any medical function.  Without limiting the generality of the foregoing,
ProMedCo  shall provide the following  administrative,  management and marketing
services as may be required in  conjunction  with ADC's  services at the Clinic.
ProMedCo shall hire and supervise an  Administrator,  subject to the approval of
the Policy  Council,  to manage and administer  all of the  day-to-day  business
functions of ProMedCo subject to the terms of the Hospital Agreements, including
without limitation:

         3.1.1 Annual  Budgets.  Financial  planning and  preparation  of annual
budgets.  Annually  and at least thirty (30) days prior to the  commencement  of
each  fiscal  year,  ProMedCo  shall  prepare  and  deliver to ADC  capital  and
operating  budgets  reflecting in  reasonable  detail  anticipated  revenues and
expenses,  sources and uses of capital for growth of ADC's  practice  and Clinic
services.

         3.1.2 Financial  Statements.  ProMedCo shall prepare monthly and fiscal
year unaudited financial  statements  containing a balance sheet and a statement
of income for Clinic  operations,  which shall be delivered to ADC within thirty
(30) days after the close of each  calendar  month.  The fiscal  year  statement
shall be reviewed by a certified  public  accountant  as selected by ProMedCo in
connection with the audit of the financial  statements of Parent. If ADC desires
an audit in addition to the audit  provided by ProMedCo,  such an audit would be
at ADC's expense.

         3.1.3  Non-Physician  Personnel.  ProMedCo  will provide all  personnel
reasonably  necessary for the conduct of Clinic operations with the exception of
Technical Employees. ProMedCo shall determine and cause to be paid the salaries,
fringe benefits and any sums for income taxes,  unemployment  insurance,  social
security taxes or any other  withholding  amounts  required by applicable law or
governmental authority, of all such personnel. Such personnel shall be under the
direction,  supervision and control of ProMedCo, with those personnel performing
patient care

services subject to the professional  supervision of ADC. If ADC is dissatisfied
with the services of any person, ADC shall consult with ProMedCo. ProMedCo shall
in good faith  determine  whether  the  performance  of that  employee  could be
brought to acceptable  levels through  counsel and  assistance,  or whether such
employee  should be terminated.  All of ProMedCo's  obligations  regarding staff
shall be governed by the overriding principle and goal of providing high quality
medical care.

         3.1.4 Quality and Utilization  Management.  ProMedCo will assist ADC in
fulfilling its obligation to its patients to maintain high quality and efficient
medical and professional  services,  including  patient  satisfaction  programs,
employee education,  outcomes analysis,  utilization programs, clinical protocol
development and to implement a risk management program.

         3.1.5             Facilities and Equipment.  ProMedCo will ensure the
proper cleanliness of the premises, maintenance and cleanliness of the
equipment, furniture and furnishings located on the premises.

         3.1.6 Inventory Control and Purchasing  Supplies.  ProMedCo shall order
and purchase  inventory  and  supplies,  and such other  ordinary,  necessary or
appropriate  materials which are reasonably  necessary to deliver quality Clinic
services in a cost effective manner.

         3.1.7  Managed  Care  Contracting.  ProMedCo  will be  responsible  for
marketing, negotiation, and administering all managed care contracts, subject to
the provisions of Section 2.2.5;  provided,  however, no contract or arrangement
regarding the provision of Clinical services shall be entered into without ADC's
consent.

         3.1.8 Billing and Collections. ProMedCo shall bill patients and collect
all fees for services performed inside or outside the Clinic Facility or arrange
for such billing and  collection.  ADC hereby  appoints  ProMedCo,  for the term
hereof, to be its true and lawful  attorney-in-fact  for the following  purposes
(i) to bill patients in ADC's name and on its behalf,  (ii) to collect  accounts
receivable resulting from such billing in ADC's name and on its behalf, (iii) to
receive  payments  from Blue Shield,  Medicare,  Medicaid,  payments from health
plans,  and all other third party  payors;  (iv) to receive the cash proceeds of
any  accounts  receivable  subject  to the  Hospital  Agreements;  (v)  to  take
possession  of and  endorse  in  the  name  of ADC  (and/or  in the  name  of an
individual  physician,  such  payment  intended  for  purpose  of  payment  of a
physician's bill) any notes, checks, money orders,  insurance payments and other
instruments received in payment of accounts  receivable;  and (vi) in accordance
with policies  adopted by the Policy Council,  to initiate legal  proceedings in
the name of ADC to collect  any  accounts  and  monies  owed to the  Clinic,  to
enforce the rights of ADC as creditors  under any contract or in connection with
the  rendering  of any  service,  and to  contest  Adjustments  and  denials  by
governmental agencies (or its fiscal  intermediaries) as third-party payors. All
adjustments made for uncollectible  accounts,  professional courtesies and other
activities  that do not generate a collectible fee shall be done in a reasonable
and consistent manner.

         3.1.9             Deposit of Net Clinic Revenues.  During the term of 
this

Agreement,  all Net Clinic Revenues  collected  resulting from the operations of
the Clinic shall be deposited directly into a bank account of which ADC shall be
the owner ("Account").  ProMedCo and ADC shall maintain their accounting records
in such a way as to clearly  segregate  Net Clinic  Revenues from other funds of
ProMedCo  or  ADC.  ADC  hereby  appoints   ProMedCo  as  its  true  and  lawful
attorney-in-fact  to  deposit  in  the  Account  all  revenues  collected.   ADC
covenants,  and shall  cause all ADC  Employees  to  covenant,  to  forward  any
payments  received with respect to Net Clinic Revenues for services  provided by
ADC and ADC Employees to ProMedCo for deposit.  ADC and ProMedCo hereby agree to
execute from time to time such documents and  instructions  as shall be required
by the bank  maintaining  the Account and mutually agreed upon to effectuate the
foregoing provisions and to extend or amend such documents and instructions.

         3.1.10 Management information  Systems/Computer Systems. ProMedCo shall
supervise and provide for information systems that are necessary and appropriate
for the operation of the Clinic as determined by the Policy Council.

         3.1.11 Legal and  Accounting  Services.  ProMedCo  shall arrange for or
render to ADC such business,  legal and financial  management  consultation  and
advice as may be reasonably required or requested by ADC and directly related to
the operations of the Clinic.  ProMedCo  shall not be responsible  for rendering
any legal or tax advice or services or personal financial services to ADC or any
employee or agent of ADC.

         3.1.12  Insurance  Products.  ProMedCo  shall  negotiate  for and cause
premiums  to be paid  with  respect  to the  insurance  which is  necessary  and
appropriate for the operation of the Clinic as determined by the Policy Council.
Premiums  and  deductibles  with  respect  to such  policies  shall  be a Clinic
Expense.

         3.1.13  Physician  Recruiting.  ProMedCo shall assist ADC in recruiting
additional  physicians,  carrying  out such  administrative  functions as may be
appropriate  such as  advertising  for  and  identifying  potential  candidates,
checking  credentials,  and arranging interviews;  provided,  however, ADC shall
interview and make the ultimate  decision as to the suitability of any physician
to become associated with the Clinic.  All physicians  recruited by ProMedCo and
accepted by ADC shall be the sole employees of ADC to the extent such physicians
are hired as employees.  Any expenses incurred in the recruitment of physicians,
including,   but  not  limited  to,  employment  agency  fees,   relocation  and
interviewing expenses shall be Clinic Expenses approved by the Policy Council.

         3.1.14 Supervision of Ancillary Services.  ProMedCo shall operate
and supervise such ancillary services as approved by the Policy Council.

         3.1.15   Strategic Planning Assistance.  ProMedCo shall assist with
and implement the strategic plan as approved by the Policy Council.

         3.1.16            Advertising and Public Relations.  ProMedCo shall
implement all advertising and public relations activities which are
approved by the Policy Council.

         3.1.17 Files and Records. ProMedCo shall supervise and maintain custody
of an files and records  relating to the operation of the Clinic,  including but
not limited to accounting,  billing,  patient  medical  records,  and collection
records.  Patient  medical records shall at all times be and remain the property
of ADC and shall be  located  at  Clinic  facilities  so that  they are  readily
accessible  for patient  care.  The  management  of all files and records  shall
comply  with  applicable  state and  federal  statutes.  ProMedCo  shall use its
reasonable  efforts to preserve the  confidentiality of patients medical records
and use  information  contained  in such  records  only for the limited  purpose
necessary to perform the services set forth  herein,  provided,  however,  in no
event  shall a breach of said  confidentiality  be deemed a default  under  this
Agreement.

         3.1.18  Payments.  ProMedCo  shall  make the  payments  required  under
Section 7 "Financial Arrangements" of this Agreement.

         3.2  Administrator.  ProMedCo shall hire and employ the  Administrator,
pursuant  to the  instructions  of the Policy  Council as  described  in Section
2.2.3.

         3.3  Expansion  of Clinic.  ProMedCo  will pursue  various  programs to
increase revenue and profitability  including assisting ADC in adding additional
office based  procedures,  ancillary  services and adding  additional  satellite
office(s) as  determined  by the Policy  Council to be beneficial to the Clinic.
ProMedCo  will  also  assist  in  recruiting   new   physicians  and  developing
relationships and affiliations with other physicians, hospitals, networks, HMOs,
etc. To assist in the continued  growth and development of the Clinic,  ProMedCo
may acquire other physician  practices for  integration  into ADC as approved by
the Policy Council. ADC will cooperate with ProMedCo in such efforts and use its
best efforts to assist  ProMedCo  with  respect  thereto.  Without  limiting the
generality of the foregoing, ADC will not enter into any agreements with respect
to any such matter  without the prior  consent of ProMedCo.  ProMedCo  shall not
establish,  operate,  manage, or in any way own or operate any medical facility,
clinic,  or other health care  facility  providing  services  within a radius of
twenty-five  (25) miles of the Taylor County  Courthouse in Abilene,  Texas,  or
within a radius of  twenty-five  (25)  miles of any  current  or future  medical
office,  clinic,  or other health care facility from which ADC provides  medical
services, without the consent of ADC.

         3.4 Events  Excusing  Performance.  ProMedCo shall not be liable to ADC
for  failure  to perform  any of the  services  required  herein in the event of
strikes,  lock-outs,  calamities,  acts of God,  unavailability of supplies,  or
other  events  over which  ProMedCo  has no control  for so long as such  events
continue, and for a reasonable amount of time thereafter.

         3.5      Compliance With Applicable Laws.  ProMedCo shall comply with
all applicable federal, state and local laws, regulations and
restrictions in the conduct of its obligations under this Agreement.

4.       OBLIGATIONS OF ADC

         4.1      Professional Services.  ADC shall provide professional

services to patients in compliance at all times with ethical standards, laws and
regulations applying to the medical profession.  ADC shall also ensure that each
physician  associated  with ADC is licensed by the State of Texas.  In the event
that any  disciplinary  actions or medical  malpractice  actions  are  initiated
against any such physician,  ADC shall  immediately  inform the Administrator of
such action and the underlying  facts and  circumstances.  ADC shall carry out a
program  to monitor  the  quality of medical  care  practiced,  with  ProMedCo's
assistance.  ADC will  cooperate  with  ProMedCo in taking  steps to resolve any
utilization or quality  management issues which may arise in connection with the
Clinic. The costs of any such utilization or quality  management  programs shall
be a Clinic Expense.

         4.2 Employment Of Physician Employees.  ADC shall have complete control
of and responsibility for the hiring, compensation,  supervision, evaluation and
termination of its Physician  Members and Physician  Employees,  although at the
request of ADC,  ProMedCo  shall  consult with ADC regarding  such matters.  ADC
shall enforce formal employee  agreements from each of its Physician Members and
Physician  Employees,  hired or contracted,  substantially  in the form attached
hereto as Exhibit "C".

         4.3 Non-Clinic Expenses. Non-Clinic Expenses shall include salaries and
benefits;  retirement plan contributions;  health, disability and life insurance
premiums; and payroll taxes of Physician Members, Physician Employees,'and those
Physician  Extenders  who are not under the direct  supervision  of a  Physician
Member or Physician Employee.

         4.4      Medical Practice.  ADC shall use and occupy the Clinic
Facility exclusively for the practice of medicine, and shall comply with
all applicable local rules, ordinances and all standards of medical care.
It is expressly acknowledged by the parties that the medical practice or
practices conducted at the Clinic Facility shall be conducted solely by
physicians associated with ADC, and no other physician or medical
practitioner shall be permitted to use or occupy the Clinic Facility
without the prior written consent of the Policy Council.

         4.5      Professional Insurance Eligibility.  ADC shall cooperate in
the obtaining and retaining of professional liability insurance by
assuring that its Physician Members and Physician Employees are
insurable, and participating in an ongoing risk management program.

         4.6  Employment  Of  Non-Physician  Employees.  There  will be  certain
Technical  Employees that perform  technical  functions for ADC. These Technical
Employees  will  remain in the employ of ADC.  As  provided  in Section  3.1.3.,
ProMedCo win provide  payroll and  administrative  services  for such  Technical
Employees.

         4.7 Events  Excusing  Performance.  ADC shall not be liable to ProMedCo
for  failure  to perform  any of the  services  required  herein in the event of
strikes,  lock-outs,  calamities,  acts of God,  unavailability of supplies,  or
other events over which ADC has no control for so long as such events  continue,
and for a reasonable amount of time thereafter.

         4.8      Compliance With Applicable Laws.  ADC shall comply with all
applicable federal, state and local laws, regulations and restrictions

in the conduct of its obligations under this Agreement.

         4.9  Restrictions  on Use of  Clinic  Facility.  ADC shall at all times
during the term of this Agreement  comply with the policy of ProMedCo  stated in
Section 6 herein.

4.10     ADC Employee Benefit Plans.

         (a) As of the Effective Date of this  Agreement,  ADC has in effect the
employee  welfare  benefit plans (as such term is defined in Section 3(l) of the
Employee  Retirement Income Security Act of 1974, as amended  ("ERISA")) and the
employee  pension  benefit  plans (as such term is defined  in  Section  3(2) of
ERISA), as set forth in Exhibit "D" to this Agreement.

         (b) ADC  shall  not  enter  into any new  "employee  benefit  plan" (as
defined  in  Section  3(3) of ERISA)  without  the  express  written  consent of
ProMedCo.  Except as otherwise  required by law, ADC shall not materially amend,
freeze,  terminate or merge any ADC Plan without the express  written consent of
ProMedCo.  ADC agrees to make such changes to ADC's Plan,  including the freeze,
termination, or merger of such ADC Plan, as may be approved by ProMedCo.

         (c) Expenses incurred in connection with any ADC Plan or other employee
benefit plan maintained by ADC, including without limitation the compensation of
counsel,  accountants,  corporate trustees and other agents shall be included in
Clinic Expenses.

         (d) The contribution and administration  expenses for Physician Members
and  Physician  Employees  shall  be an  expense  of ADC.  ProMedCo  shall  make
contributions or payments with respect to any ADC Plan, as a Clinic Expense,  on
behalf of eligible Technical Employees.

         (e)  ProMedCo  shall have the sole and  exclusive  authority  to adopt,
amend, or terminate any employee  benefit plan for the benefit of its employees.
ProMedCo  shall have the sole and  exclusive  authority  to appoint the trustee,
custodian, and administrator of any such plan.

         4.11 Physician Powers of Attorney.  ADC shall require all ADC Employees
to execute and deliver to ProMedCo powers of attorney,  satisfactory in form and
substance to ProMedCo and ADC, appointing ProMedCo as attorney-in-fact  for each
for the purposes set forth in Sections 3.1.8 and 3.1.9, which powers of attorney
shall immediately terminate upon termination of this Agreement.

         4.12 Spokesperson. ADC shall serve as spokesperson for ProMedCo, Parent
and Clinic  regarding sales and development  activities.  The parties agree that
Drs.  Arthur,  Bailey,  and Headstream,  or such other Physician  Members as the
Policy Council shall appoint, shall serve in this capacity on behalf of ADC.

         4.13     Delegation of ADC Responsibilities.  ADC shall delegate to
ProMedCo all duties and responsibilities it may have for the management
and administration of the Hospital Agreements, including, but not limited
to, those duties, powers, and responsibilities vested in ADC pursuant to

the Hospital Agreements.  ADC shall inform the Hospitals of this
delegation of responsibilities to ProMedCo and shall fully cooperate with
ProMedCo in effecting such delegation.

5.RECORDS

         5.1 Patient  Records.  Upon  termination of this  Agreement,  ADC shall
retain all patient medical records  maintained by ADC or ProMedCo in the name of
ADC. ADC shall,  at its option,  be entitled to retain  copies of financial  and
accounting records relating to all services performed by ADC.

         5.2      Other Records.  All records relating in any way to the
operation  of the Clinic  shall at all times be the  property  of ADC.  ProMedCo
shall be authorized to obtain copies of all records, other than patient records,
relating to the operation of ADC at any reasonable time during business hours.

         5.3  Access  to  Records.  During  the  term  of  this  Agreement,  and
thereafter,  ADC or its  accountant or other designee shall upon 24 hours notice
have  reasonable  access during normal  business  hours to ADC's and  ProMedCo's
financial  records,  including,  but not  limited  to,  records of  collections,
expenses  and  disbursements  as  kept  by  ProMedCo  in  performing  ProMedCo's
obligations under this Agreement, and ADC may copy any or all such records.

6.       FACILITIES TO BE PROVEDED BY PROMEDCO

         6.1  Facilities.  ProMedCo  hereby  agrees to  provide  or arrange as a
Clinic Expense the offices and facilities for Clinic  operations,  including but
not limited to, the Clinic  Facility and all costs of repairs,  maintenance  and
improvements,   utility  (telephone,  electric,  gas,  water)  expenses,  normal
janitorial  services,  related real or personal property lease cost payments and
expenses, taxes and insurance,  refuse disposal and all other costs and expenses
reasonable  incurred in conducting  operations in the Clinic Facility during the
term of this Agreement.

         6.2 Use of  Facilities.  Voluntary  abortions  will not be performed in
facilities  that are owned or leased by  ProMedCo  or any of its  affiliates  in
whole or in part. ProMedCo and ADC agree that ADC, as an independent contractor,
is a separate  organization  that  retains the  authority to direct the medical,
professional, and ethical aspects of its medical practice. If a Physician Member
or a Physician Employee performs abortion  procedures in any facility,  ProMedCo
shall not receive any ProMedCo Distribution from the revenue generated from such
procedures.

7.       FINANCIAL ARRANGEMENTS

         7.1 Payments to ProMedCo.  ADC and ProMedCo agree that the compensation
set forth  herein is being paid to ProMedCo in  consideration  of a  substantial
commitment  made  by  ProMedCo  hereunder  and  that  such  fees  are  fair  and
reasonable. Upon execution of this Agreement, but in no event not later than the
Effective  Date of this  Agreement,  ADC will pay  ProMedCo  an  estimate of the
monthly amount of all Clinic Expenses paid

in the first month of this  Agreement.  As payment for its services  rendered to
ADC, each month  beginning on the 15th day of the month  following the Effective
Date of this Agreement  ProMedCo shall be paid the amount of all Clinic Expenses
and the ProMedCo Distribution.

         7.2 Clinic Expenses.  Commencing on the Effective Date,  ProMedCo shall
pay all Clinic Expenses as they fall due, provided,  however, that ProMedCo may,
in the name of and on behalf of ADC,  contest in good faith any  claimed  Clinic
Expenses as to which there is any dispute  regarding  the nature,  existence  or
validity of such claimed Clinic  Expenses.  ProMedCo  hereby agrees to indemnify
and hold ADC harmless from and against any  liability,  loss,  damages,  claims,
causes of action and  reasonable  expenses of ADC resulting  from the contest of
any Clinic Expenses.  Any Clinic Expenses  incurred and not paid by ADC prior to
the  effective  date of this  Agreement,  and not  specifically  included in the
estimate pursuant to Section 7.1 above and paid by ProMedCo, shall be reimbursed
to ProMedCo by ADC within 30 days of payment by ProMedCo.

         7.3    Accounts Receivables.  ADC shall pledge its accounts
receivable to ProMedCo as security for payment of the amounts due to
ProMedCo from ADC.

8.       INSURANCE AND INDEMNITY

         8.1 Insurance to Be Maintained by ProMedCo. Throughout the term of this
Agreement,  ProMedCo will use reasonable  efforts to provide and maintain,  as a
Clinic  Expense,  all  necessary  insurance,  including,  but  not  limited  to,
comprehensive professional liability insurance for all professional employees of
ProMedCo  and ADC with  limits  as  determined  reasonable  by  ProMedCo  in its
national  program,   comprehensive  general  liability  insurance  and  property
insurance covering the Clinic Facility and operations.

         8.2 Insurance to be Maintained by ADC. Unless  otherwise  determined by
the  Policy  Council,  throughout  the term of this  Agreement,  subject  to the
provisions  of Section  4.5 and Section 8. 1, ADC shall  maintain  comprehensive
professional liability insurance with limits of not less than $300,000 per claim
and with  aggregate  policy limits of not less than $600,000 per physician and a
separate limit for ADC. ADC shall be responsible for all liabilities  (including
without  limitation  deductibles  and excess  liabilities)  not paid  within the
limits of such  policies.  ProMedCo  shall have the option,  with Policy Council
approval,  of  providing  such  professional   liability  insurance  through  an
alternative  program,  provided  such  program  meets  the  requirements  of the
Insurance Commissioner of the State of Texas.

         8.3  Tail  Insurance  Coverage.   Unless  covered  by  an  "occurrence"
malpractice policy, ADC will cause each individual physician associated with the
Clinic  to  enter  into an  agreement  with ADC that  upon  termination  of such
physician's  relationship with ADC, for any reason, tail insurance coverage will
be purchased by the individual  physician.  Such  provisions may be contained in
employment  agreements,  restrictive  covenant  agreements  or other  agreements
entered into by ADC and the individual physicians, and ADC hereby covenants with
ProMedCo to enforce such provisions  relating to the tail insurance  coverage or
to provide such

cover-age at the expense of ADC.

         8.4      Additional Insured.  ADC and ProMedCo agree to use their best
efforts to have each other named as an additional insured on the other's
respective professional liability insurance programs at ProMedCo's
expense.

         8.5  Indemnification.  ADC shall  indemnify,  hold  harmless and defend
ProMedCo,  its officers,  directors and employees,  from and against any and all
liability,  loss,  damage,  claim,  causes of action,  and  expenses  (including
reasonable  attorneys' fees), to the extent not covered by insurance,  caused or
asserted to have been caused,  directly or indirectly,  by or as a result of (i)
the performance of medical services or any other acts or omissions by ADC and/or
its members,  agents,  employees  and/or  subcontractors  (other than  ProMedCo)
during the term hereof, including any claim against ProMedCo by an ADC Employee,
which claim arises out of such ADC Employees'  employment  relationship with ADC
or as a result of services performed by such ADC Employee, and which claim would
typically  be  covered by  worker's  compensation  and (ii) any  claims  made by
Hospitals  against  ProMedCo  because  of  ProMedCo's   entering  into  and  its
performance of the terms and conditions of this  Agreement,  including,  but not
limited to, any and all liability,  loss, damage,  claim,  causes of action, and
expenses  (including  reasonable  attorneys'  fees)  for  alleged  breach  of or
tortious  interference with the Hospital  Agreements.  ProMedCo shall indemnify,
hold harmless and defend ADC, its officers,  directors and  employees,  from and
against  any and all  liability,  loss,  damage,  claim,  causes of action,  and
expenses  (including  reasonable  attorneys' fees), to the extent not covered by
insurance, caused or asserted to have been caused, directly or indirectly, by or
as a result  of the  performance  of any  intentional  acts,  negligent  acts or
omissions   by  ProMedCo   and/or  its   members,   agents,   employees   and/or
subcontractors  (other than ADC) during the term of this  Agreement,  except for
any liability,  loss, damage,  claim, causes of action, and expenses which might
arise in connection with the Hospital Agreements.

9. RESTRICTIVE COVENANTS AND LIQUIDATED DAMAGES

         The  parties  recognize  that the  services  to be provided by ProMedCo
shall be feasible only if ADC operates an active  medical  practice to which the
physicians  associated  with ADC devote their full time and  attention.  To that
end:

         9.1  Restrictive  Covenants by ADC.  During the term of this Agreement,
ADC shall not establish,  operate or provide  physician  services at any medical
office,  clinic or other health care facility providing  services  substantially
similar to those  provided by ADC pursuant to this Agreement  anywhere  within a
radius of  twenty-five  (25) miles of the Taylor  County  Courthouse in Abilene,
Texas,  or within a radius of  twenty-five  (25) miles of any  current or future
medical  office,  clinic or other health care  facility  from which ADC provides
medical services.

         9.2      Restrictive Covenants By Current Physician Members and
Physician Employees. ADC shall enforce the employment agreements with its
current Physician Members and Physician Employees in a form satisfactory
to ProMedCo, pursuant to which the Physician Members and Physician

Employees agree not to establish,  operate or provide physician  services at any
medical office,  clinic or outpatient and/or ambulatory  treatment or diagnostic
facility  providing  services  substantially  similar to those  provided  by ADC
pursuant  to this  Agreement  within a radius of  twenty-five  (25) miles of the
Taylor County  Courthouse in Abilene,  Texas,  or within a radius of twenty-five
(25) miles of any current or future medical office,  clinic or other health care
facility  from  which  ADC  provides  medical  services,  and  for a  period  of
thirty-six (36) months after the first date of such Physician  Shareholder's  or
such Physician  Employee's  employment with ADC. ProMedCo shall have third-party
rights to enforce such agreements.

         9.3  Restrictive  Covenants By Future  Physician  Employees.  ADC shall
obtain  and  enforce  formal  employment  agreements  from  each  of its  future
Physician  Members and Physician  Employees in a form  satisfactory to ProMedCo,
pursuant to which such  physicians  agree not to  establish,  operate or provide
physician services at any medical office, clinic or outpatient and/or ambulatory
treatment or diagnostic  facility  providing services  substantially  similar to
those provided by ADC pursuant to this Agreement  within a radius of twenty-five
(25) miles of the Taylor County Courthouse in Abilene, Texas, or within a radius
of  twenty-five  (25) miles of any current or future medical  office,  clinic or
other health care facility from which ADC provides  medical  services during the
term of said  Physician  Employee's  employment  with  ADC and for a  period  of
thirty-six  (36)  months  after  the date of their  first  employment  with ADC.
ProMedCo shall have third-party rights to enforce such agreements.

         9.4 Physician  Shareholder and Physician Employee  Liquidated  Damages.
The  restrictive  covenants  described in Sections 9.2 and 9.3 of this Agreement
shall provide that the Physician  Members and Physician  Employees  (existing or
future) may be released from their  restrictive  covenants by paying  Liquidated
Damages in the amount of Two  Hundred  Thousand  Dollars  ($200,000.00)  or such
physician's  income from the practice of  medicine,  as reported to the Internal
Revenue  Service for the  previous  twelve (12) months,  whichever is less.  The
accounting treatment of such funds shall be consistently applied and approved by
ProMedCo's independent certified public accountants and the Policy Council.

         9.5  Enforcement.  ProMedCo and ADC  acknowledge and agree that since a
remedy at law for any  breach or  attempted  breach  of the  provisions  of this
Section 9 shall be  inadequate,  either  party  shall be  entitled  to  specific
performance and injunctive or other equitable  relief in case of any such breach
or attempted  breach,  in addition to whatever  other remedies may exist by law.
All parties hereto also waive any requirement for the securing or posting of any
bond in connection  with the obtaining of any such injunctive or other equitable
relief.  If any provision of Section 9 relating to territory  described  therein
shall be declared  by a court of  competent  jurisdiction  to exceed the maximum
time period, scope of activity, restricted or geographical area such court deems
reasonable  and  enforceable  under  applicable  law, the time period,  scope of
activity,  restricted  and/or area of  restriction  deemed to be reasonable  and
enforceable by the court shall thereafter be the time period, scope of activity,
restricted  and/or area of restriction  applicable to the  restrictive  covenant
provisions  in this  Section 9. The  invalidity  of  non-enforceability  of this
Section 9 in any respect shall

not affect the validity of  enforceability of the remainder of this Section 9 or
of any other provisions of this Agreement unless the invalid or  non-enforceable
provisions  materially  affect the  benefits  either  party would  otherwise  be
entitled  to  receive  under  this  Section  9 or any  other  provision  of this
Agreement.

         9.6 Termination of Restrictive Covenants.  Notwithstanding  anything to
the contrary  contained herein,  if this Agreement is terminated,  the rights of
ProMedCo under these restrictive  covenants contained in this Section 9 shall be
null and void and of no force or effect.

10.      TERM; RENEWAL; TERMINATION

         10.1 Effect of  Execution.  By executing  this  Agreement,  the parties
agree that the effective  date of that certain  Service  Agreement (the "Service
Agreement")  between ProMedCo and ADC executed on January 19, 1996, shall be the
later  date of: (a) one year from the first day of the month  following  January
19, 1996;  or (b) the first day of the month  following  the date of the initial
public offering ("IPO") of ProMedCo.

         10.2 Term and Renewal.  The term of this  Agreement  shall  commence on
January 19, 1996 (the  "Effective  Date"),  and shall continue until February 1,
1997.  ProMedCo shall have the option,  in its sole  discretion,  to extend this
Agreement for five (5) additional one (1) year periods.  Upon the effective date
of that certain Service Agreement by and between ProMedCo and ADC, dated January
19, 1996 (the "Service Agreement") this Agreement shall terminate.

         10.3  Extension  Period.  Upon the first  extension of this  Agreement,
ProMedCo  shall be  required  to pay in cash the  amount  set forth on Exhibit E
extending  this Agreement and the Effective  Date of the Service  Agreement,  as
defined therein,  shall be concurrently extended to the earlier of (i) the first
day of the month following the date of the initial public offering of Parent, or
(ii) four (4) years from the second  anniversary  of this  Agreement.  ADC shall
have the  option  to  receive  stock  valued at $7 per share in lieu of the cash
amount  set  forth on  Exhibit  E, if any.  Upon the  second  extension  of this
Agreement,  ProMedCo  shall be  required  to pay in cash the amount set forth in
Exhibit E upon  extending  this  Agreement and the Effective Date of the Service
Agreement,  as defined therein, shall be concurrently extended to the earlier of
(i) the first day of the month following the date of the initial public offering
of Parent, or (ii) four (4) years from the second anniversary of this Agreement.
ADC shall have the option to receive stock valued at $7 per share in lieu of the
cash amount set forth on Exhibit E, if any.

         10.4     Termination by ADC.  ADC may terminate this Agreement as
follows:

         10.4.1 In the event of the filing of a petition in voluntary bankruptcy
or an assignment for the benefit of creditors by ProMedCo,  or upon other action
taken or suffered, voluntarily or involuntarily,  under any federal or state law
for the benefit of debtors by  ProMedCo,  except for the filing of a petition in
involuntary  bankruptcy  against  ProMedCo  which is  dismissed  within  30 days
thereafter, ADC may give notice of the

immediate termination of this Agreement.

         10.4.2  In  the  event  ProMedCo  shall   materially   default  in  the
performance of any duty or obligation imposed upon it by this Agreement and such
default shall  continue for a period of 90 days after written notice thereof has
been given to ProMedCo by ADC; or ProMedCo  shall fail to remit the payments due
as provided in Section 7 hereof and such  failure to remit shall  continue for a
period  of 15  days  after  written  notice  thereof,  ADC  may  terminate  this
Agreement.  Termination of this Agreement pursuant to this subsection (2) by ADC
shall require the affirmative vote of 75 % of the Physician Members.

         10.4.3  In the event any  person  or  persons  (as such term is used in
Sections  13(d) and 14(d) of the  Securities  Exchange Act of 1934)  acquires or
acquires  the  right  to  vote,   through   acquisition,   tender  offer,  proxy
solicitation, merger or consolidation,  fifty percent (50%) or more of ProMedCo,
Inc. then issued and outstanding Common Stock, or securities  representing fifty
percent (50 %) or more of the  combined  voting  power of  ProMedCo,  Inc.  then
issued and outstanding  securities,  then ADC shall have the option to terminate
this  Agreement,  provided  however,  that ADC must  exercise this option within
thirty  (30) days  following  this  change  in  ownership.  Termination  of this
Agreement  pursuant to this Section by ADC shall require the affirmative vote of
75 % of ADC's Physician Members.

         10.4.4 In the event  ProMedCo  shall default on any of its payments due
under any agreement  between ADC and  ProMedCo,  and such failure to remit shall
continue 15 days after notice thereof.

         10.5     Termination by ProMedCo.  ProMedCo may terminate this
Agreement as follows:

         10.5.1 In the event of the filing of a petition in voluntary bankruptcy
or an assignment for the benefit of creditors by ADC, or upon other action taken
or suffered,  voluntarily or  involuntarily,  under any federal or state law for
the  benefit  of  debtors  by  ADC,  except  for the  filing  of a  petition  in
involuntary bankruptcy against ADC which is dismissed within 30 days thereafter,
ProMedCo may give notice of the immediate termination of this Agreement.

         10.5.2 In the event ADC shall materially  default in the performance of
any duty or  obligation  imposed  upon it by this  Agreement  or in the  event a
majority of the Physician Members shall materially default in the performance of
any  duty  or  obligation  imposed  upon  them  by this  Agreement  or by  their
employment  agreements with ADC, and such default shall continue for a period of
90 days after written  notice  thereof has been given to ADC and such  Physician
Members by ProMedCo, ProMedCo may terminate this Agreement.

         10.6 Actions After Termination.  In the event that this Agreement shall
be  terminated,  the ProMedCo  Distribution  shall be paid through the effective
date of termination. In addition, the various rights and remedies herein granted
to the aggrieved  party shall be  cumulative  and in addition to any others such
party may be entitled to by law.  The exercise of one or more rights or remedies
shall not impair the right of

the aggrieved party to exercise any other right or remedy, at law.

11. DEFINITIONS

         For the purposes of this  Agreement,  the following  definitions  shall
apply:

         11.1 Net Clinic  Revenues  shall mean ADC's gross  billings,  including
ancillaries and any other revenues that have  historically been recorded by ADC,
less Adjustments and less any Risk Pool Surpluses.

         11.2 Distribution Funds shall mean those amounts remaining after Clinic
Expenses have been deducted from Net Clinic Revenue.

         11.3 ProMedCo Distribution shall mean [*]% of Distribution Funds plus a
percentage of Risk Pool Surpluses established by Exhibit A.

         11.4 Clinic shall mean the medical care  services,  including,  but not
limited to the  practice  of  medicine,  and all related  health  care  services
provided by ADC and the ADC  Employees,  utilizing  the  management  services of
ProMedCo and the Clinic Facility, regardless of the location where such services
are rendered.

         11.5 Clinic Facility shall mean the clinic  facilities  located at 1665
Antilley Road, Suite 200,  Abilene,  Texas and 1150 N. 18th, Suite 300, Abilene,
Texas,  and any substitute  facility or additional  facility  location,  whether
within or without Taylor County, as approved by the
Policy Council.

         11.6 Clinic Expenses shall mean the amount of all expenses  incurred in
the operation of the Clinic including, without limitation:

         11.6.1 Salaries,  benefits  (including  contributions  under any Parent
benefit  plan),  and other direct costs of all  Technical  Employees,  Physician
Extenders who are under the direct supervision of Physician Members or Physician
Employees and all employees of ProMedCo and Technical Employees  attributable to
ADC;

         11.6.2  Direct  costs,   including   benefits,   of  all  employees  or
consultants  of Parent or affiliate of ProMedCo who, with approval of the Policy
Council,  provides  services at or in connection  with ADC required for improved
performance,  such as work management,  purchasing,  information systems, charge
and coding analysis, managed care sales, negotiating and contracting,  financial
analysis, and business office consultation; provided, however, only that portion
of such  employee's  or  consultant's  costs  without  mark-up by Parent that is
allocable to Clinic will be a Clinic Expense;

         11.6.3 Obligations of ProMedCo or Parent under leases or subleases
related to Clinic operations;

         11.6.4        Interest Expense on indebtedness incurred by ProMedCo or
Parent to finance or refinance any of its obligations hereunder or
services provided hereunder;

CERTAIN CONFIDENTIAL INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

         11.6.5  Personal   property  and  intangible   taxes  assessed  against
ProMedCo's  assets used in connection with the operation of Clinic commencing on
the date of this Agreement;

         11.6.6        Malpractice insurance expenses for ProMedCo's operations
and for the ADC Employees, as well as any deductibles and non-insured
expenses relating to malpractice claims;

         11.6.7           AR management fees paid under the Hospital Agreements;

         11.6.8 AU expenses of providing  equipment  and supplies or  performing
all management or other services listed in Section 3 "Obligations of ProMedCo, "
as well as any other expenses which are described as "Clinic Expenses" elsewhere
in this Agreement;

         11.6.9 All professional fees, including,  but not limited to, legal and
accounting fees attributable to the business of ADC.

         11.6.10  Other  expenses  incurred  by  ProMedCo  in  carrying  out its
obligations  under this  Agreement;  including all usual and customary  business
expenses of ADC, other than those defined in Section 4.3 above.

         11.7     Clinic Expenses shall not include:

         11.7.1  Corporate  overhead  charges or any other expenses of Parent or
any  corporation  affiliated  with  Parent  other than the kind of items  listed
above;

         11.7.2        Any federal or state income taxes;

         11.7.3        Those expenses defined in Section 4.3 of this Agreement;

         11.7.4        Any liabilities, judgments, or settlements assessed
against ADC or Physician Members in excess of any insurance policy
limits; and

         11.7.5        Expenses incurred specifically for the management of risk
pools.

         11.8 Risk Pool Surpluses shall mean all hospital risk funds, specialist
risk  funds,  and funds from risk pools under any risk  bearing or risk  sharing
arrangement,  after  deduction  of Risk Pool Cost of Care,  and after making any
deductions for capitation or other risk pools that are in a deficit position.

         11.9 Risk Pool Cost Of Care shall mean all claims, capitation payments,
and Incurred But Not Reported (IBNR) calculations  charged against any risk pool
(defined as any hospital risk fund,  specialist  risk fund,  and funds from risk
pools under any risk  bearing or risk  sharing  arrangement).  Risk Pool Cost Of
Care shall also include the expenses incurred specifically for the management of
risk pools.

         11.10 Opening Balance Sheet shall mean the balance sheet of ProMedCo as
of the Effective Date prepared in accordance with GAAP

(except for the absence of certain note  information),  and substantially in the
form of the attached Exhibit B.

         11.11 Technical  Employees shall mean  technicians who provide services
in the  diagnostic  areas of ADC's  practice,  such as  employees  of the Clinic
laboratory, radiology technicians and cardiology technicians.
AU Technical Employees shall be ADC employees.

         11.12  Physician  Members  shall mean any  physician who is a member of
ADC, both as of the, date of this Agreement and at any future point in time.

         11.13 Physician  Employees shall mean any physician employed by ADC and
providing  medical  services to patients on behalf of ADC, who are not Physician
Members.

         11.14  Physician  Extenders  shall mean all  nonphysician  professional
employees  who  provide  direct  patient  care  for  which a  billed  charge  is
generated.

         11.15  ADC  Employees  shall  mean  all  Physician  Members,  Physician
Employees and Technical Employees at the relevant date.

         11.16  Adjustments  "adjustments"  shall mean any  Adjustments to ADC's
gross  billings for  uncollectible  accounts,  discounts,  Medicare and Medicaid
disallowances,  workers' compensation discount,  employee/ dependent health care
benefit  programs,  professional  courtesies,  and other  activities that do not
generate a collectible  fee. Any Adjustments made shall be based on a reasonable
historical basis, or a reasonable prospective basis should a new payor agreement
apply, and shall be periodically  modified during the year to reflect the actual
Adjustments.  Final Adjustments and any resulting  payments owed by one party to
the other  shall be made within  (30) days after  completion  of the fiscal year
audit.

12. GENERAL PROVISIONS

         12.1 Independent Contractor. It is acknowledged and agreed that ADC and
ProMedCo  are at all  times  acting  and  performing  hereunder  as  independent
contractors.  ProMedCo  shall neither have nor exercise any control or direction
over the methods by which ADC or the ADC Employees practice  medicine.  The sole
function  of  ProMedCo  hereunder  is to provide  all  management  services in a
competent,  efficient and satisfactory  manner.  ProMedCo shall not, by entering
into and performing its obligations under this Agreement,  become liable for any
of the  existing  obligations,  liabilities  or  debts of ADC  unless  otherwise
specifically  provided for under the terms of this Agreement.  ADC shall not, by
entering into and performing its obligations under this Agreement, become liable
for any of the existing  obligations,  liabilities,  or debts of ProMedCo unless
otherwise specifically provided for under the terms of this Agreement.  ProMedCo
will in its management role have only an obligation to exercise  reasonable care
in the  performance  of the  management  services.  Neither party shall have any
liability  whatsoever for damages suffered on account of the willful  misconduct
or  negligence  of any employee,  agent or  independent  contractor of the other
party.

Each party shall be solely responsible for compliance with all state and federal
laws  pertaining  to  employment   taxes,   income   withholding,   unemployment
compensation contributions and other employment related statutes regarding their
respective employees, agents and servants.

         12.2 Other Contractual  Arrangement.  The parties acknowledge and agree
that they have been  advised  and  consent  to the fact that  ProMedCo,  or it's
affiliates  (i)  may  have,  prior  to the  date of  this  Agreement,  discussed
proposals with respect to, or (ii) may, from time to time hereafter,  enter into
agreements  with  one or more  ADC  Employees  to  provide  consulting,  medical
direction,  advisory or similar  services  relating to activities of ProMedCo or
its affiliates in clinical areas. The parties agree that such agreement, if any,
shall be entered into at the sole  discretion of the parties thereto and subject
to  such  terms  and  conditions  to  which  such  parties  may  agree,  and any
compensation payable to or by ProMedCo, on the one hand, and such ADC Employees,
on  the  other  hand,  shall  not  constitute  Net  Clinic   Revenues,   or  ADC
Compensation,  and shall  otherwise  not be  subject to the  provisions  of this
Agreement.

         12.3     Proprietary Property.

         12.3.1 Each party agrees that the other  party's  proprietary  property
shall not be possessed,  used or disclosed  otherwise  than may be necessary for
the performance of this Agreement. Each party acknowledges that its violation of
this Agreement  would cause the other party  irreparable  harm, and may (without
limiting the other party's remedies for such breach) be enjoined at the instance
of the other party.  Each party agrees that upon  termination  of this Agreement
for any reason,  absent the prior written  consent of the other party,  it shall
have no  right to and  shall  cease  all use of the  other  party's  proprietary
property,  and shall return all such proprietary  property of the other party in
its possession to the other party.

         12.3.2 ProMedCo shall be the sole owner and holder of all right,  title
and interest, to all intellectual property furnished by it under this Agreement,
including all computer software, copyright, services mark and trademark right to
any material or documents acquired, prepared, purchased or furnished by ProMedCo
pursuant to this Agreement.  ADC shall have no right, title or interest in or to
such  material and shall not, in any manner,  distribute or use the same without
the  prior  written  authorization  of  ProMedCo,  provided,  however,  that the
foregoing  shall not restrict ADC fi-om  distributing  managed care  information
brochures and materials  without the prior written approval of ProMedCo provided
no Proprietary Property of ProMedCo is contained therein.

         12.4  Cooperation.  Each of the parties shall  cooperate fully with the
other  in  connection  with  the  performance  of their  respective  duties  and
obligations under this Agreement.

         12.5 Licenses,  Permits and  Certificates.  ProMedCo and ADC shall each
obtain and maintain in effect, during the term of this Agreement,  all licenses,
permits  and  certificates  required  by  law  which  are  applicable  to  their
respective performance pursuant to this Agreement.

         12.6     Compliance with Rules, Regulations and Laws.  ProMedCo and ADC

shall comply with all federal and state laws and  regulations  in performance of
their duties and obligations  hereunder.  Neither party,  nor their employees or
agents,   shall  take  any  action  that  would  jeopardize  the  other  party's
participation,  if applicable,  in any federal or state health program including
Medicare and  Medicaid.  ProMedCo and ADC shall take  particular  care to ensure
that no employee or agent of either  party takes any action  intended to violate
Section 1128B of the Social Security Act with respect to soliciting,  receiving,
offering or paying any remuneration  (including any kickback,  bribe, or rebate)
directly or  indirectly,  overtly or covertly,  in cash or in kind in return for
referring an  individual  to a person for the  furnishing  or arranging  for the
furnishing  of any item or service for which  payment may be made in whole or in
part under Title  XVIII or XIX of the Social  Security  Act, or for  purchasing,
leasing,  ordering,  or arranging for or recommending  purchasing,  leasing,  or
ordering any good,  facility,  service, or item for which payment may be made in
whole or in part under Title XVIII or XIX of the Social Security Act.

         12.7 Generally  Accepted  Accounting  Principles  (GAAP). All financial
statements and  calculations  contemplated by this Agreement will be prepared or
made in accordance with generally accepted  accounting  principles  consistently
applied unless the parties agree otherwise in writing.

         12.8 Notices.  Any notices  required or permitted to be given hereunder
by either party to the other may be given by personal  delivery in writing or by
registered or certified mail,  postage prepaid,  with return receipt  requested.
Notices  shall be  addressed  to the parties at the  addresses  appearing on the
signature page of the Agreement,  but each party may change such party's address
by written  notice given in  accordance  with this  Section.  Notices  delivered
personally will be deemed communicated as of actual receipt; mailed notices will
be deemed communicated as of three days after mailing.

         12.9     Attomeys' Fees.  ProMedCo and ADC agree that the prevailing
party in any legal dispute among the parties hereto shall be entitled to
payment of its attorneys' fees by the other party.

         12.10  Severability.  If any  provision of this  Agreement is held by a
court of competent  jurisdiction  or  applicable  state or federal law and their
implementing  regulations to be invalid,  void or  unenforceable,  the remaining
provisions will nevertheless continue in full force and effect.

         12.11 Arbitration.  Any controversy or claim arising out of or relating
to this Agreement or the breach  thereof will be settled by binding  arbitration
in  accordance  with  the  rules  of  commercial  arbitration  of  the  American
Arbitration   Association,   and  judgment  upon  the  award   rendered  by  the
arbitrator(s)  may be entered in any court  having  jurisdiction  thereof.  Such
arbitration shall occur within the County of Taylor,  State of Texas, unless the
parties  mutually  agree to have such  proceedings  in some  other  locale.  The
arbitrator(s)  may in any such proceeding award attorneys' fees and costs to the
prevailing party.

         12.12             Construction of Agreement.  This Agreement shall be

governed by and construed in accordance with the laws of the State of Texas. The
parties  agree that the terms and  provisions  of this  Agreement  embody  their
mutual  interest  and  agreement  and  that  they are not to be  construed  more
liberally in favor of, nor more strictly against, any party hereto.

         12.13  Assignment  and  Delegation.  ProMedCo  shall  have the right to
assign its rights  hereunder  to any person,  firm or  corporation  controlling,
controller  by or  under  common  control  with  ProMedCo  and  to  any  lending
institution,  for security purposes or as collateral, from which ProMedCo or the
Parent  obtains  financing  for itself and as agent.  Except as set forth above,
ProMedCo shall not have the right to assign its rights and obligations hereunder
without the written  consent of ADC. ADC shall have the obligation  hereunder to
assign this Agreement to a successor entity,  provided ProMedCo shall have given
its prior written consent to such  assignment.  Except as forth above, ADC shall
not have the right to assign its rights and  obligations  hereunder  without the
written consent of ProMedCo. ADC may not delegate any of ADC's duties hereunder,
except as expressly contemplated herein; however,  ProMedCo may delegate some of
all of  ProMedCo's  duties  hereunder  to the extent it  concludes,  in its sole
discretion,  that such  delegation  is in the  mutual  interest  of the  parties
hereto.

         12.14  Confidentiality.  The terms of this  Agreement and in particular
the  provisions  regarding  compensation,  are  confidential  and  shall  not be
disclosed  except  as  necessary  to the  performance  of this  Agreement  or as
required by law.

         12.15  Waiver.  The  waiver of any  provision,  or of the breach of any
provision of this Agreement must be set forth specifically in writing and signed
by the waiving  party.  Any such  waiver  shall not operate or be deemed to be a
waiver  of any  prior  or  future  breach  of  such  provision  or of any  other
provision.

         12.16  Headings.  The subject  headings of the articles and sections of
this  Agreement  are  included for  purposes of  convenience  only and shall not
affect the construction or interpretation of any of its provisions.

         12.17 No Third Party Beneficiaries.  Nothing in this Agreement, express
or implied, is intended or shall be construed to confer upon any person, firm or
corporation  other than the parties  hereto and their  respective  successors or
assigns,  any remedy or claim under or by reason of this  Agreement or any term,
covenant or condition hereof, as third party beneficiaries or otherwise, and all
of the  terms,  covenants  and  conditions  hereof  shall  be for the  sole  and
exclusive benefit of the parties hereto and their successors and assigns.

         12.18 Time is of the Essence.  Time is hereby expressly declared to
be of the essence in this Agreement.

         12.19         Modifications of Agreement for Prospective Legal Events.
In the event any state or federal laws or regulations, now existing or
enacted or promulgated after the effective date of this Agreement, are
interpreted by judicial decision, a regulatory agency or legal counsel

for both  parties in such a manner as to  indicate  that the  structure  of this
Agreement may be in violation of such laws or  regulations,  or in the event the
Texas  State  Board  of  Medical   Examiners  or  other   authority  with  legal
jurisdiction  shall,  solely by virtue of this Agreement,  initiate an action to
revoke,  suspend,  or restrict the license of any  physician  retained by ADC to
practice  medicine  in the State of Texas,  ADC and  ProMedCo  shall  amend this
Agreement as necessary. To the maximum extent possible, any such amendment shall
preserve the  underlying  economic and  financial  arrangements  between ADC and
ProMedCo. In the event it is not possible to amend this Agreement to preserve in
all material respects the underlying economic and financial arrangements between
ADC and ProMedCo,  this  Agreement may be terminated by written notice by either
party within 90 days from date of such interpretation or action,  termination to
be  effective  no sooner  than the  earlier of 180 days from the date  notice of
termination is given or the latest possible date specified for such  termination
in any regulatory order or notice. Termination pursuant to this Section 12.19 by
ADC shall require the affirmative vote of a majority of Physician Members.

         12.20  Whole  Agreement;  Modification.  A contract in which the amount
involved exceeds $50,000 in value is not enforceable  unless the Agreement is in
writing  and  signed  by the  party  to be bound  or by that  part's  authorized
representative.  The rights  and  obligations  of the  parties  hereto  shall be
determined solely from written  agreements.  Documents and instruments,  and any
prior oral agreements between the parties are superseded by and merged into such
writings.  This  Agreement  (As  amended  in  writing  from time to  time),  the
exhibits,  and the  schedules  delivered  pursuant  hereto  represent  the final
agreement between the parties hereto and may not be contradicted by; evidence of
prior, contemporaneous,  or subsequent oral agreements by the parties. There are
no unwritten  oral  agreements  between the parties.  This paragraph is included
herein  pursuant to Section  26.02 of the Texas  Business and Commerce  Code, as
amended from time to time.

IN WITNESS  WBEREOF,  the parties  hereto have executed this Agreement as of the
date and year first above written,

PROMEEDCO OF ABILENE, INC.,

Address:          801 Cherry Street - Suite 1050 Fort Worth, Texas 76102

ABILENE DIAGNOSTIC CLINIC, P.L.L.C.

By:
Name:
Title:
Address:

1665 Antilley Road - Suite 200
Abilene, Texas 79606

Allocation of Risk Pool Surpluses

         ProMedCo  shall  receive a percentage  of the Risk Pool  Surpluses,  or
shall be responsible for a percentage of any deficits if the Risk Pool Surpluses
are in a deficit position pursuant to Section 11.9.  ProMedCo's percentage shall
be based on the  cumulative  risk pool  savings  that have  occurred  during the
entire term of this Agreement,  including any renewals.  The percentage shall be
based on the graduated scale as shown below:

Cumulative Risk Pool Surplus                         ProMedCo %

[*]

         The  distribution  of Risk  Pool  Surpluses  shall be made on an annual
basis no later than 90 days after the  conclusion  of each contract year of this
Agreement,  and after a full  analysis of an Incurred  But Not  Reported  (IBNR)
liabilities.  Once the final balance of Risk Pool Surpluses has been calculated,
[*]% of that  amount  shall  be  distributed,  with  the  final [*]% held for 
an additional 6 months to pay for any  unanticipated  claims.  At the end of 
that 6 months, any funds remaining from the [*]% reserved shall be distributed.

CERFTAIN CONFIDENTIAL INFORMATION ON THIS PAGE HAS BEEN OMITTED AND FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

Qpening Balance Sheet

Current Assets
Cash
Accounts Receivable
Prepaid
Other Current Assets
Total Current Assets

Other Assets
Investments
Deposits
Other Assets
Total Other Assets

Property and Equipment
Land
Buildings
Building Fixed Equipment
Equipment
Capitalized Lease Equipment
Accrued Depreciation
Total Property and Equipment

Intangibles
Organization Cost
Loan Cost
Non-Compete Covenants
Other Intangibles
Total Intangibles

TOTAL ASSETS

Current Liabilities
Accounts Payable
Notes Payable
Payroll & Taxes Payable
Accrued Expenses
Accrued Interest
Current Maturities- Leases
Current Maturities - Notes
Other Current Liabilities
Total Current Liabilities

Other Liabilities
Deficit in Limited Liability Company
Deferred Credits
Total Other Liabilities

Long Term Payables Mortgages
Notes Payable
Lease Obligations
Total Long Term Payables
Members Capital Account
Contributed Capital
Accumulated Income or Deficit
Total Members Equity

TOTAL LIABILITIES AND CAPITAL ACCOUNT 

Basic Info X:

Name: INTERIM SERVICE AGREEMENT
Type: Interim Service Agreement
Date: Aug. 23, 1996
Company: PROMEDCO MANAGEMENT CO
State: Delaware

Other info:

Date:

  • October 13 , 1993
  • 20th day of June , 1994
  • thirty 30
  • 15th day of the month
  • February 1 , 1997
  • January 19 , 1996
  • second anniversary of this Agreement

Organization:

  • Taff Insurance Coverage
  • ProMedCo of Abilene , Inc.
  • Abilene Diagnostic Clinic Associates
  • Southwestern Health Development Corporation
  • Practice Management Agreement
  • Abilene Medical Management Services
  • General Responsibilities of the Parties
  • Net Revenue Calculation
  • American Medical Association
  • Texas Medical Association
  • Inventory Control and Purchasing Supplies
  • Managed Care Contracting
  • Deposit of Net Clinic Revenues
  • Supervision of Ancillary Services
  • Strategic Planning Assistance
  • Expansion of Clinic
  • ADC 4.1 Professional Services
  • Employment Of Physician Employees
  • Professional Insurance Eligibility
  • Events Excusing Performance
  • Compliance With Applicable Laws
  • Use of Clinic Facility
  • ADC Employee Benefit Plans
  • Physician Powers of Attorney
  • PROMEDCO 6.1 Facilities
  • Use of Facilities
  • the Insurance Commissioner of the State
  • Tail Insurance Coverage
  • Current Physician Members and Physician Employees
  • Future Physician Employees
  • Taylor County Courthouse
  • Physician Employee Liquidated Damages
  • Internal Revenue Service
  • Termination of Restrictive Covenants
  • Effective Date of the Service Agreement
  • ProMedCo , Inc.
  • 11.6.4 Interest Expense
  • Physician Employees and Technical Employees
  • American Arbitration Association
  • County of Taylor , State
  • Third Party Beneficiaries
  • Modifications of Agreement for Prospective Legal Events
  • Texas State Board of Medical Examiners
  • Texas Business and Commerce Code
  • Qpening Balance Sheet Current Assets Cash Accounts Receivable Prepaid Other Current Assets Total Current Assets Other Assets Investments Deposits Other Assets Total Other Assets Property and Equipment Land Buildings Building Fixed Equipment Equipment Capitalized Lease Equipment Accrued Depreciation Total Property and Equipment Intangibles Organization Cost Loan Cost Non-Compete Covenants Other Intangibles Total Intangibles TOTAL ASSETS Current Liabilities Accounts Payable Notes Payable Payroll & Taxes Payable Accrued Expenses Accrued Interest Current
  • Limited Liability Company Deferred Credits Total Other Liabilities < PAGE > Long Term Payables Mortgages Notes Payable Lease Obligations Total Long Term Payables Members Capital Account Contributed Capital Accumulated Income

Location:

  • P.A
  • Taylor County
  • State of Texas
  • Fort Worth
  • Abilene

Money:

  • $ 300,000
  • $ 600,000
  • $ 200,000.00
  • $ 7
  • $ 50,000

Person:

  • Bailey

Percent:

  • fifty percent
  • 50 %
  • 75 %
  • ProMedCo %
  • ] %