Hospital Business and Related Assets in Texas

Auction Sale of substantially all of assets of the Walker County Hospital Corporation d/b/a Huntsville Memorial Hospital, including all of the following assets:

• All Accounts Receivable as of the Closing Date;
• All interests of Seller in the real property owned by Seller that is described in Schedule 2.1(a) (the “Owned Real Property”), including all rights of Seller in the land, buildings, fixtures, parking lots, construction in progress, and other improvements located thereon as to each parcel of real property included in such Owned Real Property;
• Subject to Section 2.3(b), all leasehold interests (together with any amendments, renewals, guaranties or other agreements with respect thereto, the “Proposed Tenant Leases”) of Seller used exclusively in connection with the operation of the Healthcare Business in and to the real property (the real property that is subject to the Proposed Tenant Leases being referred to as the “Leased Real Property”), (the term “Real Property” means collectively the Owned Real Property and the Leased Real Property) that are described in Schedule 2.1(c);
• All interests of Seller in and to all real property leases, subleases, licenses, use and other occupancy agreements relating exclusively to the operation of the Seller Facility or the Healthcare Business described in Schedule 2.1(d) (each, a “Proposed Lessor Lease”);
• All equipment, furniture, furnishings, machinery, tools, supplies, telephones, office equipment, leasehold improvements and other tangible personal property used by Seller in connection with the operations of the Seller Facility;
• All Inventory owned by Seller and exclusively used in connection with the operation of the Seller Facility (other than the portions of Inventory disposed of, or expended, as the case may be, by Seller after the Effective Date and prior to the Closing in the ordinary course of business);
• The member interest in HMHPO that is owned or controlled by Seller pursuant to the Member Interest Assignment attached hereto as Exhibit 10;
• All Prepaid Assets related to the Healthcare Business other than any Prepaid Assets exclusively relating to any of the Excluded Assets;
• All intangible personal property owned by Seller and exclusively used in connection with the operation of the Seller Facility, including all right, title and interest in and to all Facility IP, including the names set forth on Schedule 2.1(i), but excluding (A) the right to use any names, trade names, trademarks and service marks including the name “Huntsville Memorial Hospital” and (B) all proprietary software, data processing programs, or source codes used by Seller;
• All financial, medical staff and personnel records (including those related to the preparation of Cost Reports) owned by Seller and used in connection with the operation of the Seller Facility or the Purchased Assets (including all equipment records, construction plans and specifications, medical and administrative libraries, documents, catalogs, books, records, files, operating manuals and current personnel records) and all patient and medical records (subject to a mutually agreeable medical records custodianship agreement) used in connection with the operation of the Purchased Assets (provided that personnel records not relating to the Transferred Employees shall not be treated as Purchased Assets);
• Subject to Section 2.11, all of a Seller’s rights to receive insurance proceeds relating to the physical condition of the Seller Facility and the Purchased Assets, to the extent not expended on the repair or restoration of the Purchased Assets prior to the Closing;
• Subject to Sections 2.3(b) and 5.6(b), the Contracts of Seller (i) designated in Schedule 2.1(l) as Material Contracts to be assumed by Buyer or (ii) which exclusively relate to the operation of the Seller Facility but are not required to be listed in Schedule 3.8, and in any event including the Medicare and Medicaid provider agreements for the Seller Facility ((i) and (ii), collectively the “Proposed Assumed Contracts”);
• To the extent assignable, all Permits held by Seller relating exclusively to the ownership, development and operation of the Seller Facility and the Purchased Assets;
• All claims or causes of action relating to or arising from the Healthcare Business other than claims that arise under Chapter 5 of Title 11 of the United States Code;
• Subject to Section 2.3(a)(iv), except for any positive amounts with respect to Medicare reimbursement for bad debts of the Seller Facility under 42 C.F.R. § 413.89 associated with services furnished prior to the Effective Time, which shall be governed pursuant to Section 8.11 of this Agreement, rights to positive cost report settlements and retroactive adjustments on Seller Cost Reports in respect of time periods prior to the Closing (“Seller Agency Settlements”);
• Subject to Section 2.3(a)(iv), except for any positive amounts with respect to Medicare reimbursement for bad debts of the Seller Facility under 42 C.F.R. § 413.89 relating to services furnished prior to the Closing, which shall be governed pursuant to Section 8.11 of this Agreement, any amounts receivable and any amounts received on or after the Closing Date with respect to any extraordinary payments and payment adjustments from any Third Party Payor, including payments and payment adjustments: (i) relating to outlier reconciliation, supplemental, disproportionate share or waiver payments, or Medicaid GME funding with respect to time periods prior to the Effective Time; (ii) relating to the Seller Cost Reports or Seller Agency Settlements (whether resulting from an appeal of a disallowance or otherwise) and other risk settlements with respect to time periods prior to the Effective Time; (iii) which result any appeals pertaining to Medicare, Medicaid (including disproportionate share hospital program payments), TRICARE or other Third Party Payors for services furnished during periods prior to the Effective Time; (iv) relating to participation in any group purchasing organization (including any rebates or fee sharebacks for purchases made and paid for prior to the Effective Time) with respect to periods prior to the Effective Time; or (v) arising from Meaningful Use attestations with respect to time periods prior to the Effective Time;
• The goodwill generated by or associated with Seller and the Seller Facility;
• All intercompany receivables between Seller and HMHPO;
• All telephone and facsimile numbers, post office boxes and directory listings used exclusively in connection with the Seller’s operation of the Healthcare Business; and
• Any other tangible asset located within the Seller Facility as of (x) the Effective Date or (y) the Closing Date, in each case not otherwise articulated in the foregoing (a) through (o) and not otherwise an Excluded Asset.