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                                                                    EXHIBIT 10.7


                                 TRUST AGREEMENT


         This Agreement made this 25th day of January, 1999, by and between Team
Health, Inc., a Tennessee corporation (the "Company"), and The Trust Company of
Knoxville (the "Trustee");

         WHEREAS, the Company has adopted the Team Health, Inc. Equity Deferred
Compensation Plan (the "Plan") attached hereto as Exhibit A, and the executives
of the Company listed in Exhibit B attached hereto are the initial Participants
in the Plan (the "Executives");

         WHEREAS, the Company has incurred or expects to incur liability under
the terms of such Plan with respect to the Executives;

         WHEREAS, the Company wishes to establish a trust (hereinafter called
the "Trust") and to contribute to the Trust assets that shall be held therein,
subject to the claims of the Company's creditors in the event of the Company's
Insolvency, as herein defined, until paid to the Executives and their
beneficiaries in such manner and at such times as specified in the Plan;

         WHEREAS, it is the intention of the parties that this Trust shall
constitute an unfunded arrangement and shall not affect the status of the Plan
as an unfunded plan maintained for the purpose of providing deferred
compensation for a select group of management or highly compensated employees
for purposes of Title I of the Employee Retirement Income Security Act of 1974;

         WHEREAS, it is the intention of the Company to make contributions to
the Trust to provide itself with a source of funds to assist it in the meeting
of its liabilities under the Plan;

         NOW, THEREFORE, the parties do hereby establish the Trust and agree
that the Trust shall be comprised, held and disposed of as follows:

         SECTION 1. ESTABLISHMENT OF TRUST

         (a) The Company hereby deposits with the Trustee in trust $8,580,250 or
such other amount as determined by the Company, which shall become the principal
of the Trust to be held, administered and disposed of by the Trustee as provided
in this Trust Agreement.

         (b) The Trust hereby established shall be irrevocable.

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         (c) The Trust is intended to be a grantor trust, of which the Company
is the grantor, within the meaning of subpart E, part I, subchapter J, chapter
1, subtitle A of the Internal Revenue Code of 1986, as amended, and shall be
construed accordingly.

         (d) The principal of the Trust, and any earnings thereon shall be held
separate and apart from other funds of the Company and shall be used exclusively
for the uses and purposes of the Executives and general creditors as herein set
forth. The Executives and their beneficiaries shall have no preferred claim on,
or any beneficial ownership interest in, any assets of the Trust. Any rights
created under the Plan and this Trust Agreement shall be mere unsecured
contractual rights of the Executives and their beneficiaries against the
Company. Any assets held by the Trust will be subject to the claims of the
Company's general creditors under federal and state law in the event of
Insolvency, as defined in Section 3(a) herein.

         (e) The Company, in its sole discretion, may at any time, or from time
to time, make additional deposits of cash or other property in trust with the
Trustee to augment the principal to be held, administered and disposed of by the
Trustee as provided in this Trust Agreement. Neither the Trustee nor any
Executive or any beneficiary shall have any right to compel such additional
deposits.

         SECTION 2. PAYMENTS TO EXECUTIVES AND THEIR BENEFICIARIES.

         (a) The Company shall deliver to the Trustee a schedule (the "Payment
Schedule") that indicates the amounts payable in respect of each Executive (and
his or her beneficiaries), that provides a formula or other instructions
acceptable to the Trustee for determining the amounts so payable, the form in
which such amount is to be paid (as provided for or available under the Plan),
and the time of commencement for payment of such amounts. Except as otherwise
provided herein, the Trustee shall make payments to the Executives and their
beneficiaries in accordance with such Payment Schedule. The Trustee shall make
provision for the reporting and withholding of any federal, state or local taxes
that may be required to be withheld with respect to the payment of benefits
pursuant to the terms of the Plan and shall pay amounts withheld to the
appropriate taxing authorities or determine that such amounts have been
reported, withheld and paid by the Company.

         (b) The entitlement of an Executive or his or her beneficiaries to
benefits under the Plan shall be determined by the Company or such party as it
shall designate under the Plan, and any claim for such benefits shall be
considered and reviewed under the procedures set out in the Plan.

         (c) The Company may make payment of benefits directly to the Executives
or their beneficiaries as they become due under the terms of the Plan. The
Company shall notify the Trustee of its decision to make payment of benefits
directly prior to the time amounts are payable to the Executives or their
beneficiaries. In addition, if the principal of the Trust, and any earnings
thereon, are not sufficient to make payments of benefits in accordance with the
terms of the Plan, the Company shall make the balance of each such payment as it
falls due. The Trustee shall notify the Company where principal and earnings are
not sufficient.


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         SECTION 3. TRUSTEE RESPONSIBILITY REGARDING PAYMENTS TO TRUST
         BENEFICIARY WHEN THE COMPANY IS INSOLVENT.

         (a) The Trustee shall cease payment of benefits to the Executives and
their beneficiaries if the Company is Insolvent. The Company shall be considered
"Insolvent" for purposes of this Trust Agreement if (i) the Company is unable to
pay its debts as they become due, or (ii) the Company is subject to a pending
proceeding as a debtor under the United States Bankruptcy Code.

         (b) At all times during the continuance of this Trust, as provided in
Section 1(d) hereof, the principal and income of the Trust shall be subject to
claims of general creditors of the Company under federal and state law as set
forth below.

                  (1) The Board of Directors and the Chief Executive Officer of
the Company shall have the duty to inform the Trustee in writing of the
Company's Insolvency. If a person claiming to be a creditor of the Company
alleges in writing to the Trustee that the Company has become Insolvent, the
Trustee shall determine whether the Company is Insolvent and, pending such
determination, the Trustee shall discontinue payment of benefits to the
Executives or their beneficiaries.

                  (2) Unless the Trustee has actual knowledge of the Company's
Insolvency, or has received notice from the Company or a person claiming to be a
creditor alleging that the Company is Insolvent, the Trustee shall have no duty
to inquire whether the Company is Insolvent. The Trustee may in all events rely
on such evidence concerning the Company's solvency as may be furnished to the
Trustee and that provides the Trustee with a reasonable basis for making a
determination concerning the Company's solvency.

                  (3) If at any time the Trustee has determined that the Company
is Insolvent, the Trustee shall discontinue payments to the Executives or their
beneficiaries and shall hold the assets of the Trust for the benefit of the
Company's general creditors. Nothing in this Trust Agreement shall in any way
diminish any rights of the Executives or their beneficiaries to pursue their
rights as general creditors of the Company with respect to benefits due under
the Plan or otherwise.

                  (4) The Trustee shall resume making payments to the Executives
or their beneficiaries in accordance with Section 2 of this Trust Agreement only
after the Trustee has determined that the Company is not Insolvent (or is no
longer Insolvent).

         (c) Provided that there are sufficient assets, if the Trustee
discontinues the payment of benefits from the Trust pursuant to Section 3(b)
hereof and subsequently resumes such payments, the first payment following such
discontinuance shall include the aggregate amount of all payments due to the
Executives or their beneficiaries under the terms of the Plan for the period of
such discontinuance, less the aggregate amount of any payments made to the
Executives or their beneficiaries by the Company in lieu of the payments
provided for hereunder during any such period of discontinuance.


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         SECTION 4. PAYMENTS TO THE COMPANY.

         Except as provided in Section 3 hereof, after the Trust has become
irrevocable, the Company shall have no right or power to direct the Trustee to
return to the Company or to divert to others any of the Trust assets before all
payments have been made to the Executives and their beneficiaries pursuant to
the terms of the Plan.

         SECTION 5. INVESTMENT AUTHORITY.

         The Trustee may invest in securities (including equity or rights to
acquire equity) or obligations issued by Team Health Holdings, LLC, a Delaware
limited liability company and majority stockholder of the Company. All rights
associated with assets of the Trust shall be exercised by the Trustee or the
person designated by the Trustee, and shall in no event be exercisable by or
rest with the Executives. The Company shall have the right at anytime, and from
time to time in its sole discretion, to substitute assets of equal fair market
value for any asset held by the Trust. This right is exercisable by the Company
in a nonfiduciary capacity without the approval or consent of any person in a
fiduciary capacity.

         SECTION 6. DISPOSITION OF INCOME.

         During the term of this Trust, all income received by the Trust, net of
expenses and taxes, shall be accumulated and reinvested.

         SECTION 7. ACCOUNTING BY THE TRUSTEE.

         The Trustee shall keep accurate and detailed records of all
investments, receipts, disbursements, and all other transactions required to be
made, including such specific records as shall be agreed upon in writing between
the Company and the Trustee. Within 90 days following the close of each calendar
year and within 90 days after the removal or resignation of the Trustee, the
Trustee shall deliver to the Company a written account of its administration of
the Trust during such year or during the period from the close of the last
preceding year to the date of such removal or resignation, setting forth all
investments, receipts, disbursements and other transactions effected by it,
including a description of all securities and investments purchased and sold
with the cost or net proceeds of such purchases or sales (accrued interest paid
or receivable being shown separately), and showing all cash, securities and
other property held in the Trust at the end of such year or as of the date of
such removal or resignation, as the case may be.

         SECTION 8. RESPONSIBILITY OF THE TRUSTEE.

         (a) The Trustee shall act with the care, skill, prudence and diligence
under the circumstances then prevailing that a prudent person acting in like
capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims, provided, however, that


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the Trustee shall incur no liability to any person for any action taken pursuant
to a direction, request or approval given by the Company which is contemplated
by, and in conformity with, the terms of the Plan or this Trust and is given in
writing by the Company. In the event of a dispute between the Company and a
party, the Trustee may apply to a court of competent jurisdiction to resolve the
dispute.

         (b) If the Trustee undertakes or defends any litigation arising in
connection with this Trust, the Company agrees to indemnify the Trustee against
the Trustee's costs, expenses and liabilities (including, without limitation,
attorneys' fees and expenses) relating thereto and to be primarily liable for
such payments. If the Company does not pay such costs, expenses and liabilities
in a reasonably timely manner, the Trustee may obtain payment from the Trust.

         (c) The Trustee may consult with legal counsel (who may also be counsel
for the Company generally) with respect to any of its duties or obligations
hereunder.

         (d) The Trustee may hire agents, accountants, actuaries, investment
advisors, financial consultants or other professionals to assist it in
performing any of its duties or obligations hereunder.

         (e) The Trustee shall have, without exclusion, all powers conferred on
Trustees by applicable law, unless expressly provided otherwise herein,
provided, however, that if an insurance policy is held as an asset of the
Trust, the Trustee shall have no power to name a beneficiary of the policy other
than the Trust, to assign the policy (as distinct from conversion of the policy
to a different form) other than to a successor Trustee, or to loan to any person
the proceeds of any borrowing against such policy.

         (f) Notwithstanding any powers granted to the Trustee pursuant to this
Trust Agreement or to applicable law, the Trustee shall not have any power that
could give this Trust the objective of carrying on a business and dividing the
gains therefrom, within the meaning of section 301.7701-2 of the Procedure and
Administrative Regulations promulgated pursuant to the Internal Revenue Code.

         SECTION 9. COMPENSATION AND EXPENSES OF TRUSTEE.

         The Company shall pay all administrative and Trustee's fees and
expenses. If not so paid, the fees and expenses shall be paid from the Trust.

         SECTION 10. RESIGNATION AND REMOVAL OF TRUSTEE.

         (a) The Trustee may resign at any time by written notice to the
Company, which shall be effective 60 days after receipt of such notice unless
the Company and the Trustee agree otherwise.

         (b) The Trustee may be removed by the Company on 30 days notice or upon
shorter notice accepted by the Trustee.


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         (c) Upon resignation or removal of the Trustee and appointment of a
successor Trustee, all assets shall subsequently be transferred to the successor
Trustee. The transfer shall be completed within 60 days after receipt of notice
of resignation, removal or transfer, unless the Company extends the time limit.

         (d) If the Trustee resigns or is removed, a successor shall be
appointed, in accordance with Section 11 hereof, by the effective date of
resignation or removal under paragraphs (a) or (b) of this section. If no such
appointment has been made, the Trustee may apply to a court of competent
jurisdiction for appointment of a successor or for instructions. All expenses of
the Trustee in connection with the proceeding shall be allowed as administrative
expenses of the Trust.

         SECTION 11. APPOINTMENT OF SUCCESSOR.

         (a) If the Trustee resigns or is removed in accordance with Section
10(a) or (b) hereof, the Company may appoint any third party, such as a bank
trust department or other party that may be granted corporate trustee powers
under state law, as a successor to replace the Trustee upon resignation or
removal. The appointment shall be effective when accepted in writing by the new
Trustee, who shall have all of the rights and powers of the former Trustee,
including ownership rights in the Trust assets. The former Trustee shall execute
any instrument necessary or reasonably requested by the Company or the successor
Trustee to evidence the transfer.

         (b) The successor Trustee need not examine the records and acts of any
prior Trustee and may retain or dispose of existing Trust assets, subject to
Sections 7 and 8 hereof. The successor Trustee shall not be responsible for and
the Company shall indemnify and defend the successor Trustee from any claim or
liability resulting from any action or inaction of any prior Trustee or from any
other past event, or any condition existing at the time it becomes successor
Trustee.

         SECTION 12. AMENDMENT OR TERMINATION.

         (a) This Trust Agreement may be amended by a written instrument
executed by the Trustee and the Company. Notwithstanding the foregoing, no such
amendment shall conflict with the terms of the Plan or shall make the Trust
revocable after it has become irrevocable in accordance with Section 1(b)
hereof.

         (b) The Trust shall not terminate until the date on which the
Executives and their beneficiaries are no longer entitled to benefits pursuant
to the terms of the Plan. Upon termination of the Trust any assets remaining in
the Trust shall be returned to the Company.


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         SECTION 13. MISCELLANEOUS.

         (a) Any provision of this Trust Agreement prohibited by law shall be
ineffective to the extent of any such prohibition, without invalidating the
remaining provisions hereof.

         (b) Benefits payable to the Executives and their beneficiaries under
this Trust Agreement may not be anticipated, assigned (either at law or in
equity), alienated, pledged, encumbered or subjected to attachment, garnishment,
levy, execution or other legal or equitable process.

         (c) This Trust Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.

         SECTION 14. EFFECTIVE DATE.

         The effective date of this Trust Agreement shall be January 25, 1999.


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         EXECUTED by the undersigned to be effective as of the 25th day of
January, 1999.


                                    TRUSTOR:

                                    Team Health, Inc.


                                    By:__________________________________
                                    Its:__________________________________



                                    TRUSTEE:

                                    The Trust Company of Knoxville


                                    By:____________________________________
                                    Its:____________________________________

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                                                                       EXHIBIT A

               Team Health, Inc. Equity Deferred Compensation Plan

                                  See Attached.


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                                                                       EXHIBIT B

                              Initial Participants