In Beck v. American Health Group Internat., Inc. (1989) 211 Cal. App. 3d 1555, the physician agreed to act as medical director of the hospital's mental health unit and maintain active admitting privileges there. The contract allowed him to admit his psychiatric patients to the unit and compensated him at 10 percent of the room and board charges of all of the hospital's psychiatric patients for each month of the agreement. (Beck v. American Health Group Internat., Inc. supra, 211 Cal. App. 3d at p. 1159.) The court held performance of the contract would violate Business and Professions Code section 650 because the compensation "formula links plaintiff's compensation to the number of psychiatric inpatients at the Hospital, thereby providing an inducement for plaintiff to refer (admit) his patients to the Hospital." (Id. at pp. 1564-1565.) In sum, the plaintiff sued the defendant for breach of contract. The alleged contract was contained in a letter to the plaintiff from the defendant's executive director which began: " 'It is a pleasure to draft the outline of our future agreement . . . .' " After outlining the terms of the agreement, the letter concluded: " 'If this is a general understanding of the agreement, I ask that you sign a copy of this letter, so that I might forward it to Corporate Counsel for the drafting of a contract. When we have a draft, we will discuss it and hopefully shall have a completed contract and operating unit in the very near future.' " Beck v. American Health Group, supra, 211 Cal. App. 3d at page 1559, footnote 1. Noting that " 'preliminary negotiations or an agreement for future negotiations are not the functional equivalent of a valid, subsisting agreement' " we concluded the letter "did not constitute a binding contract, but was merely 'an agreement to agree' which cannot be made the basis of a cause of action." We based our conclusion on the words of the letter which "manifest an intention of the parties that no binding contract would come into being until the terms of the letter were embodied in a formal contract to be drafted by corporate counsel." Beck v. American Health Group, supra, 211 Cal. App. 3d at pages 1562-1563.