AGREEMENT AND PLAN OF MERGER BY AND AMONG USMD HOLDINGS, INC. WELLMED MEDICAL MANAGEMENT, INC. AND PROJECT Z MERGER SUB, INC. Dated as of August 29, 2016

Exhibit 2.1

EXECUTION VERSION

AGREEMENT AND PLAN OF MERGER

BY AND AMONG

USMD HOLDINGS, INC.

WELLMED MEDICAL MANAGEMENT, INC.

AND

PROJECT Z MERGER SUB, INC.

Dated as of August 29, 2016

TABLE OF CONTENTS


		PAGE

ARTICLE I THE MERGER			1

Section 1.01.	The Merger		1
Section 1.02.	Closing		1
Section 1.03.	Effective Time of the Merger		2
Section 1.04.	Effects of the Merger; Further Action		2
Section 1.05.	Certificate of Incorporation; Bylaws		2
Section 1.06.	Directors and Officers		2

ARTICLE II CONVERSION OF SHARES; EXCHANGE OF CERTIFICATES			3

Section 2.01.	Effect of the Merger on Capital Stock		3
Section 2.02.	Treatment of Options and Other Equity-Based Awards		3
Section 2.03.	Appraisal Rights		5
Section 2.04.	Exchange and Payment		5
Section 2.05.	Adjustments		8

ARTICLE III REPRESENTATIONS AND WARRANTIES OF THE COMPANY			8

Section 3.01.	Organization and Qualification		8
Section 3.02.	Capitalization; Subsidiaries		9
Section 3.03.	Authority		11
Section 3.04.	No Conflict; Required Filings and Consents		11
Section 3.05.	SEC Filings; Financial Statements; Internal Controls		12
Section 3.06.	Absence of Certain Changes or Events		14
Section 3.07.	Absence of Litigation		14
Section 3.08.	Tax Matters		15
Section 3.09.	Employee Benefit Plans; ERISA		16
Section 3.10.	Labor Matters		19
Section 3.11.	Environmental		20
Section 3.12.	Compliance with Applicable Laws; Approvals from Governmental Authorities		20
Section 3.13.	Contracts		21
Section 3.14.	Interested Party Transactions; Company Advances		23
Section 3.15.	Brokers		24
Section 3.16.	Company Vote Required		24
Section 3.17.	Intellectual Property		24
Section 3.18.	Insurance		26
Section 3.19.	Property		26
Section 3.20.	Certain Payments		28
Section 3.21.	Healthcare Permits		28
Section 3.22.	Participation in Governmental and Other Third Party Payor Programs		29
Section 3.23.	Healthcare Laws		30
Section 3.24.	Privacy and Data Security		30
Section 3.25.	Information in the Information Statement and Proxy Statement		32
Section 3.26.	Takeover Statutes		32
Section 3.27.	Opinion of Financial Advisor		32


		PAGE

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB			33

Section 4.01.	Organization		33
Section 4.02.	Authority		33
Section 4.03.	No Conflict; Required Filings and Consents		33
Section 4.04.	Brokers		34
Section 4.05.	Sufficient Funds		34
Section 4.06.	Capitalization and Operation of Merger Sub		34
Section 4.07.	No Vote of Parent Stockholders; Required Approval		34
Section 4.08.	Absence of Litigation		35
Section 4.09.	Ownership of Shares		35
Section 4.10.	Information in the Information Statement and Proxy Statement		35

ARTICLE V CONDUCT OF BUSINESS PENDING THE MERGER			35

Section 5.01.	Conduct of Business by the Company Pending the Merger		35
Section 5.02.	No Control of Operations		38
Section 5.03.	Notification of Certain Matters		38
Section 5.04.	Takeover Statutes		39

ARTICLE VI ADDITIONAL AGREEMENTS			39

Section 6.01.	Company Stockholder Approval; Preparation of the Information Statement		39
Section 6.02.	Access to Information; Confidentiality of Information		42
Section 6.03.	No Solicitation of Transactions		43
Section 6.04.	Employee Matters		47
Section 6.05.	Indemnification and Insurance		48
Section 6.06.	Regulatory Approvals and Other Matters		51
Section 6.07.	Public Announcements		52
Section 6.08.	Rule 16b-3		53
Section 6.09.	Merger Sub		53
Section 6.10.	Company Convertible Notes		53
Section 6.11.	Further Assurances		53
Section 6.12.	Termination of Certain Agreements		53
Section 6.13.	Employment Agreements		54
Section 6.14.	Non-Competition and Non-Solicitation Agreement		54
Section 6.15.	Option Holder Acknowledgments		54
Section 6.16.	Resignation of Directors		54
Section 6.17.	Plan Adoption		54
Section 6.18.	Treatment of Ancillary Services		54

ARTICLE VII CONDITIONS			55

Section 7.01.	Conditions to Each Party’s Obligation to Effect the Merger		55
Section 7.02.	Conditions to the Obligations of Parent and Merger Sub		55
Section 7.03.	Conditions to the Obligations of the Company		57
Section 7.04.	Frustration of Closing Conditions		57

ARTICLE VIII TERMINATION, AMENDMENT AND WAIVER			58

Section 8.01.	Termination or Abandonment		58
Section 8.02.	Termination Fees		60
Section 8.03.	Amendments and Waivers		61


		PAGE

ARTICLE IX GENERAL PROVISIONS			62

Section 9.01.	Non-Survival		62
Section 9.02.	Fees and Expenses		62
Section 9.03.	Certain Definitions		62
Section 9.04.	Notices		62
Section 9.05.	Interpretation; Disclosure Schedule		64
Section 9.06.	Severability		65
Section 9.07.	Entire Agreement; No Other Representations or Warranties		65
Section 9.08.	Assignment; Benefit		66
Section 9.09.	Counterparts; Effect; Facsimile Signatures		66
Section 9.10.	Governing Law; Consent to Jurisdiction; Waiver of Jury Trial		67
Section 9.11.	Specific Performance		67
Section 9.12.	Parent Guarantee		68
Section 9.13.	No Recourse		68
Section 9.14.	Time		68

APPENDICES, EXHIBITS AND SCHEDULES


Appendix A		Glossary of Defined Terms

Exhibit A		Form of Amended and Restated Certificate of Incorporation
Exhibit B		Form of Amended and Restated Bylaws
Exhibit C		Form of Ventures Consent

iii

AGREEMENT AND PLAN OF MERGER

THIS AGREEMENT AND PLAN OF MERGER, dated as of August 29, 2016 (this “Agreement”), is entered into by and among USMD Holdings, Inc., a Delaware corporation (the “Company”), WellMed Medical Management, Inc., a Texas corporation (“Parent”), and Project Z Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Parent (“Merger Sub”). Capitalized terms used in this Agreement have the meanings set forth or referenced in Appendix A.

RECITALS

A. The board of directors of the Company, acting upon the unanimous recommendation of a special transaction committee of the board of directors of the Company consisting solely of independent and disinterested directors (the “Special Committee”), has unanimously (i) determined that this Agreement and the transactions contemplated hereby, including the merger of Merger Sub with and into the Company (the “Merger”), are fair to, advisable and in the best interests of the Company and its stockholders, (ii) approved and declared advisable this Agreement and the transactions contemplated hereby in accordance with the DGCL, (iii) authorized the execution and delivery, by the Company of, and the performance by the Company of its obligations under, this Agreement, and (iv) resolved to recommend that the stockholders of the Company adopt this Agreement.

B. The board of directors of each of Parent and Merger Sub has approved and declared advisable this Agreement and the transactions contemplated hereby and the execution, delivery and performance by Parent and Merger Sub of their respective obligations under this Agreement and the transactions contemplated hereby, and Parent, as the sole stockholder of Merger Sub, has agreed to adopt this Agreement immediately following the execution and delivery hereof.

AGREEMENT

NOW, THEREFORE, in consideration of the premises and the mutual representations, warranties, covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:

ARTICLE I

THE MERGER

Section 1.01. The Merger. Upon the terms and subject to the conditions of this Agreement, and in accordance with the General Corporation Law of the State of Delaware (the “DGCL”), at the Effective Time, Merger Sub shall be merged with and into the Company. As a result of the Merger, the separate corporate existence of Merger Sub shall cease and the Company shall continue as the surviving corporation in the Merger (sometimes hereinafter referred to as the “Surviving Corporation”) and as a wholly-owned subsidiary of Parent.

Section 1.02. Closing. Unless this Agreement shall have been terminated and the transactions contemplated hereby shall have been abandoned pursuant to Section 8.01 and

subject to the satisfaction or waiver (to the extent permitted by applicable Law) of the conditions set forth in ARTICLE VII, the closing of the Merger (the “Closing”) shall take place at 10:00 a.m., Dallas, Texas time, on the second (2^nd) business day after the satisfaction or waiver (to the extent permitted by applicable Law) of the conditions set forth in ARTICLE VII, excluding those conditions that, by their terms, cannot be satisfied until the Closing, but subject to the satisfaction or waiver (to the extent permitted by applicable Law) of such conditions at the Closing, at the offices of XxXxxxxxx Will & Xxxxx LLP, 0000 X. Xxxxxxx Xxxxxx, Xxxxx 0000, Xxxxxx, Xxxxx 00000, unless another date, time or place is agreed to in writing by the Company and Parent. The date on which the Closing occurs is referred to in this Agreement as the “Closing Date.”

Section 1.03. Effective Time of the Merger. Subject to the provisions of this Agreement, concurrently with the Closing, the parties shall cause a certificate of merger (the “Certificate of Merger”) to be executed and filed with the Secretary of State of the State of Delaware (the “Delaware Secretary of State”) in accordance with the applicable provisions of the DGCL and shall make all other filings and recordings required under the DGCL. The Merger shall become effective at such time as the Certificate of Merger has been duly filed with the Delaware Secretary of State or at such later date or time as may be agreed by the Company and Parent in writing and specified in the Certificate of Merger in accordance with the DGCL (the effective time of the Merger being hereinafter referred to as the “Effective Time”).

Section 1.04. Effects of the Merger; Further Action. From and after the Effective Time, the Merger shall have the effects set forth in this Agreement and in the applicable provisions of the DGCL. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, all the properties, rights, privileges, powers and franchises of the Company and Merger Sub shall vest in the Surviving Corporation, and all debts, liabilities and duties of the Company and Merger Sub shall become the debts, liabilities and duties of the Surviving Corporation. If at any time after the Effective Time any further action is necessary to vest in the Surviving Corporation the title to all property or rights of Merger Sub or the Company, the authorized officers and directors of the Surviving Corporation are fully authorized in the name of Merger Sub or the Company, as the case may be, to take, and shall take, any and all such necessary and lawful action.

Section 1.05. Certificate of Incorporation; Bylaws. At the Effective Time, (a) the certificate of incorporation of the Company shall be amended and restated to read in its entirety as set forth in Exhibit A hereto and, as so amended and restated, shall be the certificate of incorporation of the Surviving Corporation, until thereafter amended or repealed, subject to the limitations set forth in Section 6.05, in accordance with its terms and applicable Law, and (b) the bylaws of the Company shall be amended and restated to read in their entirety as set forth in Exhibit B hereto and, as so amended and restated, shall be the bylaws of the Surviving Corporation, until thereafter amended or repealed, subject to the limitations set forth in Section 6.05, in accordance with the terms thereof and the certificate of incorporation of the Surviving Corporation and applicable Law.

Section 1.06. Directors and Officers. The directors of Merger Sub immediately prior to the Effective Time shall be the initial directors of the Surviving Corporation following the Merger, and the officers of Merger Sub immediately prior to the Effective Time shall be the initial officers of the Surviving Corporation following the Merger, in each case, until their

respective successors are duly elected or appointed and qualified or until their earlier death, incapacitation, retirement, resignation or removal in accordance with the certificate of incorporation and bylaws of the Surviving Corporation.

ARTICLE II

CONVERSION OF SHARES; EXCHANGE OF CERTIFICATES

Section 2.01. Effect of the Merger on Capital Stock. At the Effective Time, by virtue of the Merger and without any action on the part of the Company, Parent, Merger Sub or any holder of any shares of capital stock of the Company, Parent or Merger Sub:

(a) Common Stock of Merger Sub. Each share of common stock, par value $0.01 per share, of Merger Sub issued and outstanding immediately prior to the Effective Time shall be converted into and become one validly issued, fully paid and nonassessable share of common stock, par value $0.01 per share, of the Surviving Corporation, and all such shares shall constitute the only outstanding shares of capital stock of the Surviving Corporation. From and after the Effective Time, all certificates that, immediately prior to the Effective Time, represented the common stock of Merger Sub shall, without the necessity of presenting the same for exchange, be deemed for all purposes to represent the number of shares of common stock of the Surviving Corporation into which they were converted in accordance with the immediately preceding sentence.

(b) Cancellation of Certain Company Common Stock. Each share of common stock, par value $0.01 per share, of the Company (the “Company Common Stock”) that is held by the Company in treasury, that is owned, directly or indirectly, by any wholly-owned subsidiary of the Company or that is owned, directly or indirectly, by Parent, Merger Sub or any other subsidiary of Parent immediately prior to the Effective Time shall no longer be outstanding and shall be automatically cancelled and shall cease to exist, and no cash or other consideration shall be delivered or deliverable in exchange therefor (collectively, “Cancelled Shares”).

(c) Conversion of Company Common Stock. Subject to the provisions of this Section 2.01, each share of Company Common Stock (other than Cancelled Shares and other than Appraisal Shares), issued and outstanding immediately prior to the Effective Time shall be automatically cancelled and shall cease to exist and be converted into the right to receive $22.34 per share in cash (the “Merger Consideration”), payable without interest, to the holder of such share, upon surrender, in the manner provided in Section 2.04, of a certificate that immediately prior to the Effective Time evidenced such share (a “Certificate”) (or, if such share is held in book-entry or other uncertificated form, upon the entry through a book-entry transfer agent of the surrender of such share on a book-entry statement; it being understood that any references herein to “Certificates” shall be deemed to include references to book-entry account statements relating to the ownership of shares of Company Common Stock).

Section 2.02. Treatment of Options and Other Equity-Based Awards.

(a) At the Effective Time, (i) each option to acquire shares of Company Common Stock held by any person (a “Company Option”), whether or not granted under the Company’s 2010 Equity Compensation Plan (the “Equity Compensation Plan”), including without

limitation, any Assumed Option (as defined in the Equity Compensation Plan), and whether or not vested and exercisable, that is outstanding and unexercised immediately prior to the Effective Time, shall be automatically cancelled without any action on the part of the holder thereof, and (ii) each Company Option that is outstanding and unexercised immediately prior to the Effective Time and by its terms has vested prior to the Effective Time or will vest immediately prior to or upon the occurrence of the Effective Time, shall be converted into the right to receive from Parent or the Surviving Corporation as promptly as practicable after the Effective Time (and in all events, not later than the later of (x) five (5) business days thereafter and (y) the end of the first payroll period ending after the Effective Time) an amount in cash equal to the product obtained by multiplying (A) the excess, if any, of the Merger Consideration over the per share exercise price of such Company Option, by (B) the aggregate number of shares of Company Common Stock that were issuable upon exercise or settlement of such Company Option immediately prior to the Effective Time (such product, the “Option Cash Payment”), payable without interest, to the holder of such Company Option; provided, that if the per share exercise price of any such Company Option equals or exceeds the Merger Consideration, the holder thereof shall not be entitled to an Option Cash Payment in respect of such Company Option. From and after the Effective Time, all Company Options shall no longer be outstanding and shall automatically terminate and cease to exist, and each holder of a Company Option shall cease to have any rights with respect thereto, except solely in respect of vested Company Options the right to receive the Option Cash Payment, if any. Company Options that remain unvested at the Effective Time shall be cancelled in their entirety and no amounts shall be paid to the holder thereof.

(b) Each share of Company Common Stock awarded that is subject to a restriction that has not lapsed or other vesting conditions that remain unsatisfied as of immediately prior to the Effective Time (each such share shall be referred to as a share of “Company Restricted Stock”) and that is granted under the Equity Compensation Plan, including shares of Company Restricted Stock granted under the Equity Compensation Plan as required under the terms of the USMD Salary Deferral Plan, whether or not subject to any restriction or vested, that is outstanding immediately prior to the Effective Time shall become fully vested immediately prior to the Effective Time without any action on the part of the holder thereof, and the restrictions thereon shall lapse immediately prior to the Effective Time. All such shares of Company Restricted Stock shall be treated as outstanding shares of Company Common Stock for purposes of Section 2.01(c). Any Merger Consideration payable with respect to such shares of Company Restricted Stock shall be paid out of the Payment Fund in accordance with Section 2.04 (less any required Tax withholdings).

(c) Immediately after the Effective Time, Parent shall provide or cause to be provided to the Surviving Corporation cash in an amount sufficient to pay the aggregate Option Cash Payments.

(d) All payments provided to holders of Company Options pursuant to this Section 2.02 shall be made through Parent’s and the Surviving Corporation’s payroll systems, subject to withholding in accordance with the provisions of Section 2.04(g).

(e) As soon as reasonably practicable following the date of this Agreement and in any event prior to the Effective Time, the Company Board shall take all requisite action, including adopting such resolutions and such other actions that are necessary to effectuate the treatment of Company Options and shares of Company Restricted Stock pursuant to this Section 2.02.

Section 2.03. Appraisal Rights. Notwithstanding anything in this Agreement to the contrary, shares of Company Common Stock issued and outstanding immediately prior to the Effective Time (other than Cancelled Shares) that are held by any holder who is entitled to demand and properly demands appraisal of such shares pursuant to, and who complies in all respects with, the provisions of Section 262 of the DGCL (“Section 262”) shall not be converted into the right to receive the Merger Consideration as provided in Section 2.01(c), but instead such holder shall be entitled to payment of the fair value of such shares (the “Appraisal Shares”) as shall be determined in accordance with the provisions of Section 262. From and after the Effective Time, each holder of Appraisal Shares shall cease to have any rights with respect thereto, except the right to receive the fair value of such Appraisal Shares in accordance with the provisions of Section 262. Notwithstanding the foregoing, if any such holder shall fail to properly perfect or otherwise shall effectively waive, withdraw or otherwise lose the right to appraisal and payment under, or a court of competent jurisdiction shall determine that such holder is not entitled to the relief provided by, Section 262, then the right of such holder to be paid the fair value of such holder’s Appraisal Shares under Section 262 shall cease and each of such Appraisal Shares shall be deemed to have been converted as of the Effective Time into the right to receive the Merger Consideration (as provided in Section 2.04(g), less any required Tax withholdings), payable without interest, as provided in Section 2.01(c), upon surrender of a Certificate or proper documentary evidence pursuant to Section 2.04, and such shares shall not be deemed to be Appraisal Shares. The Company shall give prompt written notice to Parent of any demands received by the Company for appraisal rights in respect of any shares of Company Common Stock, and Parent shall have the right to participate in and reasonably direct all negotiations and proceedings with respect to such demands. Except with the prior consent of Parent, the Company shall not make any payment with respect to, or settle or offer to settle, any such demands.

Section 2.04. Exchange and Payment.

(a) Paying Agent. Prior to the Effective Time, Parent shall (i) appoint Computershare Trust Company, N.A., to act as agent (the “Paying Agent”) for the payment of the Merger Consideration upon surrender of the Certificates in accordance with this ARTICLE II and (ii) enter into a paying agent agreement, in form and substance reasonably acceptable to the Company and Parent, with the Paying Agent for the payment of the Merger Consideration in accordance with this ARTICLE II. At or prior to the Effective Time, Parent shall deposit, or cause to be deposited, with the Paying Agent, in trust for the benefit of holders of shares of Company Common Stock, cash in an amount sufficient to pay the aggregate Merger Consideration in exchange for all shares of Company Common Stock issued and outstanding immediately prior to the Effective Time (other than Cancelled Shares or Appraisal Shares), payable upon due surrender of the Certificates pursuant to the provisions of this ARTICLE II (such cash in the aggregate being referred to as the “Payment Fund”). Such funds shall be invested by the Paying Agent as directed by Parent or the Surviving Corporation, pending payment thereof by the Paying Agent to the Company’s stockholders; provided, however, that

such investments shall be in obligations of or guaranteed by the United States of America or any agency or instrumentality thereof and backed by the full faith and credit of the United States of America, in commercial paper obligations rated A-1 or P-1 or better by Xxxxx’x Investors Service, Inc. or Standard & Poor’s Corporation, respectively, or in certificates of deposit, bank repurchase agreements, or banker’s acceptances of commercial banks with capital exceeding $1 billion (based on the most recent financial statements of such bank that are then publicly available). Earnings from such investments shall be the sole and exclusive property of the Surviving Corporation, and no part of such earnings shall accrue to the benefit of the Company’s stockholders. In the event any Appraisal Shares cease to be Appraisal Shares, Parent shall deposit, or cause to be deposited, with the Paying Agent in the Payment Fund, an amount equal to the product of (A) the Merger Consideration multiplied by (B) the number of such formerly Appraisal Shares. Parent shall promptly replace any portion of the Payment Fund, as necessary, so as to ensure that it is, at all times, maintained at a level sufficient to make prompt payment of the Merger Consideration. The Payment Fund shall not be used for any purpose that is not expressly provided for in this Agreement.

(b) Termination of Payment Fund. The Surviving Corporation shall be entitled at any time after the 180th day following the first anniversary of the Effective Time to require the Paying Agent to deliver to it any portion of the Payment Fund that remains undistributed to the former holders of shares of Company Common Stock, and any such former holders who have not surrendered their Certificate (or effective affidavits of loss in lieu thereof) in accordance with this Section 2.04 prior to that time shall thereafter look only to the Surviving Corporation for payment of the Merger Consideration, without any interest thereon, upon due surrender of their Certificates (or effective affidavits of loss in lieu thereof), in each case, subject to any abandoned property, escheat or similar Law. Any net profit resulting from, or interest or income produced by, the Payment Fund shall be payable to the Surviving Corporation.

(c) Exchange and Payment Procedures. As soon as practicable after the Effective Time, and in any event not later than the third (3^rd) business day following the Closing Date, Parent and the Surviving Corporation shall cause the Paying Agent to mail (and to make available for collection by hand) to each holder of record of a Certificate (i) a letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Certificates held by such person shall pass, only upon proper delivery of the Certificates (or affidavits of loss together with any required bond or indemnity in lieu thereof) to the Paying Agent, shall be in customary form and substance reasonably acceptable to Parent and the Paying Agent, subject to the Company’s approval (not to be unreasonably conditioned, withheld or delayed), and shall be prepared prior to Closing) and (ii) instructions for use in effecting the surrender of the Certificates in exchange for the Merger Consideration into which such shares of Company Common Stock previously represented by such Certificates shall have been converted pursuant to this Agreement. Upon surrender of a Certificate (or effective affidavits of loss together with any required bond or indemnity in lieu thereof) for cancellation to the Paying Agent or to such other agent or agents as may be appointed by the Surviving Corporation, together with such letter of transmittal, duly completed and validly executed in accordance with the instructions thereto (or, if such shares of Company Common Stock are held in book-entry or other uncertificated form, upon the entry through a book-entry transfer agent of the surrender of such shares on a book-entry account statement), and such other documents as may reasonably be required by the Paying Agent, the holder of such Certificate (or effective affidavit of loss in lieu thereof) shall be

entitled to receive from the Payment Fund in exchange therefor an amount in cash equal to the product of (i) the number of shares of Company Common Stock formerly represented by such holder’s properly surrendered Certificate (or effective affidavit of loss in lieu thereof) and (ii) the Merger Consideration (less any applicable withholding Taxes), and the Certificate so surrendered shall forthwith be cancelled. In the event of a transfer of ownership of Company Common Stock that is not registered in the share transfer books of the Company, the proper portion of the Merger Consideration may be paid in exchange therefor to a person other than the person in whose name the Certificate so surrendered is registered if such Certificate shall be properly endorsed or otherwise be in proper form for transfer and the person requesting such payment shall pay any transfer and other applicable Taxes required by reason of the payment of the Merger Consideration to a person other than the registered holder of such Certificate or establish to the reasonable satisfaction of the Surviving Corporation that such Tax has been paid or is not applicable. No interest shall be paid or shall accrue on any amount payable upon due surrender of any Certificate (or any effective affidavit of loss in lieu thereof).

(d) No Further Ownership Rights in Company Common Stock; Share Transfer Books. Until duly surrendered as contemplated by Section 2.04(c), each Certificate shall be deemed at any time after the Effective Time to represent only the right to receive upon such surrender an amount in cash equal to the product of (i) the number of shares of Company Common Stock formerly represented by such holder’s properly surrendered Certificate (or effective affidavit of loss in lieu thereof) and (ii) the Merger Consideration (less any applicable withholding Taxes), without any interest thereon, and the holders of Certificates shall not have any rights as stockholders of the Company. All cash paid upon the due surrender of a Certificate (or any effective affidavit of loss in lieu thereof) in accordance with the terms of this ARTICLE II shall be deemed to have been paid at the Effective Time in full satisfaction of all rights pertaining to the shares of Company Common Stock formerly represented by such Certificate. At the Effective Time, the share transfer books of the Company shall be closed, and there shall be no further registration of transfers on the share transfer books of the Surviving Corporation of the shares of Company Common Stock that were outstanding immediately prior to the Effective Time. If, after the Effective Time, Certificates are presented to Parent, the Surviving Corporation or the Paying Agent for transfer or any other reason, the holder of Certificates shall be given a copy of the letter of transmittal referred to in Section 2.04(c) and instructed to comply with the instructions in that letter of transmittal in order to receive the cash to which such holder is entitled pursuant to this ARTICLE II.

(e) No Liability. Anything herein to the contrary notwithstanding, none of Parent, Merger Sub, the Surviving Corporation, the Paying Agent or any other person shall be liable to any person in respect of any portion of the Payment Fund properly delivered to a public official pursuant to any applicable abandoned property, escheat or similar Law.

(f) Lost, Stolen, Defaced or Destroyed Certificates. If any Certificate shall have been lost, stolen, defaced or destroyed, upon the making of an affidavit of that fact reasonably acceptable to the Surviving Corporation by the person claiming such Certificate to be lost, stolen, defaced or destroyed and, if required by the Surviving Corporation or the Paying Agent, the posting by such person of a bond in such reasonable and customary amount as Parent, the Surviving Corporation or the Paying Agent may reasonably direct as indemnity against any claim that may be made against it with respect to such Certificate, the Paying Agent shall pay in

respect of such lost, stolen, defaced or destroyed Certificate an amount in cash equal to the product of (i) the number of shares of Company Common Stock formerly represented by such holder’s properly surrendered Certificate (or effective affidavit of loss in lieu thereof) and (ii) the Merger Consideration (less any applicable withholding Taxes), without any interest thereon.

(g) Withholding Rights. Each of Parent, the Surviving Corporation and the Paying Agent shall be entitled to deduct and withhold from any amounts otherwise payable to any person pursuant to this Agreement such amounts as are required to be deducted and withheld with respect to the making of such payment under the Internal Revenue Code of 1986 (the “Code”) or any provision of any other applicable state, local or foreign Tax Law. To the extent that amounts are so deducted and withheld, such amounts shall (i) shall be remitted by the applicable entity to the appropriate Governmental Authority and (ii) be treated for all purposes under this Agreement as having been paid to the person in respect of which such deduction and withholding was made.

Section 2.05. Adjustments. Without limiting the other provisions of this Agreement, if, at any time during the period between the date of this Agreement and the Effective Time, any change in the outstanding shares of capital stock of the Company, or securities convertible into or exchangeable into or exercisable for shares of such capital stock, shall occur, including by reason of any reclassification, recapitalization, stock split (including reverse stock split) or subdivision or combination, exchange or readjustment of shares, or any stock dividend or stock distribution with a record date during such period, merger or similar transaction, the Merger Consideration and any other amounts payable pursuant to this Agreement shall be appropriately adjusted to reflect such change and such adjustment shall provide the Company’s stockholders with the same economic effect as contemplated by this Agreement prior to such change; provided, however, that nothing in this Section 2.05 shall be deemed to permit or authorize the Company to effect any such change that it is not otherwise authorized or permitted to undertake pursuant to this Agreement, including pursuant to Section 5.01.

ARTICLE III

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

Except (i) as disclosed in the Company 10-K and the Company 10-Q (excluding any documents incorporated by reference therein, exhibits attached thereto or any disclosures included in such sections that are opinions, assumptions or beliefs of the Company or general cautionary, predicative or forward-looking in nature); provided, that the disclosures in the Company 10-K or Company 10-Q shall not modify the representations and warranties of the Company in Section 3.05, Section 3.08, Section 3.12, Section 3.14, Section 3.23 and Section 3.24) or (ii) as disclosed in the disclosure schedule delivered by the Company to Parent immediately prior to the execution of this Agreement (the “Disclosure Schedule”), the Company represents and warrants to Parent and Merger Sub as set forth in this ARTICLE III.

Section 3.01. Organization and Qualification. Each of the Company and its subsidiaries is duly organized, validly existing and in good standing (or, as applicable, the equivalent thereof) under the Laws of the jurisdiction of its organization and has the requisite power and authority necessary to own, lease and operate its properties and assets and to carry on its business as it is now being conducted. Each of the Company and its subsidiaries is duly

qualified or licensed to do business, and is in good standing (or, as applicable, the equivalent thereof), in each jurisdiction where the character of its properties and assets owned, leased or operated by it or the nature of its activities makes such qualification or licensing necessary, except where the failure to be so duly qualified or licensed or in good standing would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. The Company has made available to Parent (i) a complete and correct copy of the certificate of incorporation and the bylaws of the Company (the “Company Organizational Documents”) and the certificates of incorporation and the bylaws (or similar organizational documents) of each subsidiary of the Company (the “Subsidiary Organizational Documents” and together with the Company Organizational Documents, the “Organizational Documents”), in each case as amended, modified or restated and currently in effect and (ii) a list of the directors, members and officers of the Company and each of its subsidiaries. Neither the Company nor any of its subsidiaries are in material violation of any provision of the applicable Organizational Documents.

Section 3.02. Capitalization; Subsidiaries.

(a) The authorized capital stock of the Company consists of 49,000,000 shares of Company Common Stock, par value $0.01 per share, and 1,000,000 shares of preferred stock, par value $0.01 per share (the “Company Preferred Stock”). As of the close of business on August 12, 2016, (i) 11,393,942 shares of Company Common Stock were issued and outstanding (of which 31,801 shares are shares of Company Restricted Stock), (ii) no shares of Company Preferred Stock were issued and outstanding or reserved for issuance, (iii) no shares of Company Common Stock were held in the treasury of the Company, (iv) 870,722 shares of Company Common Stock were subject to or reserved for issuance or transfer upon exercise of outstanding Company Options or lapse of restrictions on shares of Company Restricted Stock and (v) 1,502,985 shares of Company Common Stock were reserved for issuance upon conversion of the Company Convertible Notes. All outstanding shares of Company Common Stock have been duly authorized and validly issued and are fully paid, nonassessable and free of preemptive (or similar) rights.

(b) As of the close of business on August 12, 2016, the Company had outstanding Company Options to purchase 769,939 shares of Company Common Stock and 31,801 shares of Company Common Stock subject to certain restrictions as shares of Company Restricted Stock granted under the Equity Compensation Plan. The Equity Compensation Plan (including all amendments requiring approval) has been duly approved by the Company’s stockholders to the extent such approval is required under applicable Law or under the Company Organizational Documents. All shares of Company Common Stock subject to issuance or transfer in connection with the exercise, vesting or settlement of outstanding Company Options or shares of Company Restricted Stock granted under the Equity Compensation Plan, upon issuance or transfer on the terms and conditions specified in the Equity Compensation Plan or other relevant agreement pursuant to which such Company Option or share of Company Restricted Stock was granted, shall be duly authorized, validly issued, fully paid, nonassessable and free of preemptive (or similar) rights. Except (i) as set forth above and on Section 3.02(d) of the Disclosure Schedule, (ii) as a result of the exercise, vesting or settlement of the outstanding Company Options or shares of Company Restricted Stock granted under the Equity Compensation Plan, in each case granted prior to the date hereof, or (iii) for the Company Convertible Notes, there are no

outstanding or authorized (1) shares of capital stock or other voting securities of the Company, (2) securities of the Company convertible into or exchangeable or exercisable for shares of capital stock or voting securities of the Company, (3) preemptive or other outstanding rights, stock appreciation rights, redemption rights, repurchase rights, agreements, arrangements, calls, commitments, options, warrants or other rights to acquire from the Company, or obligations of the Company to issue, any capital stock or voting securities or securities convertible into or exchangeable or exercisable for capital stock or voting securities of the Company, (4) equity equivalents, interests in the ownership or earnings of the Company or other similar rights (the foregoing sections (1) – (4) collectively, “Company Securities”), and (5) shares of capital stock, voting securities, equity interests or securities convertible into or exchangeable or exercisable for shares of capital stock, voting securities or equity interests of any of the subsidiaries of the Company or any equity equivalents, interests in the ownership or earnings of any subsidiary of the Company or other similar rights (collectively, “Subsidiary Securities”). Except for the Company Convertible Notes, there are no outstanding obligations of the Company or any of its subsidiaries to repurchase, redeem or otherwise acquire any Company Securities or any Subsidiary Securities or to provide funds to or make any investment (in the form of a loan, capital contribution or otherwise) in any subsidiary or any other person.

(c) None of the Company or any of its subsidiaries is a party to any stockholders’ agreement, voting trust agreement or registration rights agreement relating to Company Securities or Subsidiary Securities or any other Contract relating to disposition, voting or dividends with respect to any Company Securities or Subsidiary Securities or granting to any person or group of persons the right to elect, or to designate or nominate for election, a director to the Company Board or the board of directors (or equivalent governing body) of any of its subsidiaries.

(d) Section 3.02(d) of the Disclosure Schedule contains a complete and correct list of each subsidiary of the Company and all other entities in which the Company owns, directly or indirectly, any shares of capital stock or other equity interests. Such list sets forth the jurisdiction of organization, the amount of all shares of capital stock or other equity interests therein owned by the Company, directly or indirectly, and, with respect to each subsidiary of the Company, describes all of its outstanding Subsidiary Securities and lists the holders thereof. Each of the outstanding shares of capital stock or other equity interests of each such subsidiary is duly authorized, validly issued, fully paid and non-assessable and was issued free of preemptive (or similar rights), and all such shares or other interests in any such subsidiary or person that are owned by the Company or a subsidiary of the Company are owned free and clear of all security interests, liens, claims, pledges, limitations or restrictions in voting, dividend or transfer rights, charges or other encumbrances of any nature whatsoever (“Liens”), except for Permitted Liens and such transfer restrictions of general applicability as may be provided under the Securities Act and other applicable securities Laws. The Company does not directly or indirectly control or own any capital stock of, or other voting securities or equity or similar interests in, or investment in or have any obligation to invest in, any other entity, except as set forth on Section 3.02(d) of the Disclosure Schedule.

(e) Except as (i) set forth in Section 3.02(e) of the Disclosure Schedule and (ii) as may be incurred after the date hereof in accordance with Section 5.01, there is not any indebtedness for borrowed money, or guarantees of indebtedness for borrowed money of any person, by the Company or any of its subsidiaries.

(f) As of the date hereof, other than distributions by the Company’s subsidiaries in the ordinary course of business, there are no dividends or similar distributions that have accrued or been declared but are unpaid on the Company Common Stock, Company Preferred Stock, Company Restricted Stock or other equity interests of the Company or any of its subsidiaries, and neither the Company nor any of its subsidiaries is subject to any obligation (contingent or otherwise) to pay any dividend or otherwise to make any distribution or payment to any current or former holder of any of the Company Securities, Subsidiary Securities, Company Restricted Stock, shares of capital stock or other equity interests of the Company or any of its subsidiaries, as applicable, in respect of any such holder’s ownership of such equity securities.

Section 3.03. Authority.

(a) The Company has all necessary corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby. The execution, delivery and performance of this Agreement by the Company and the consummation by the Company of the transactions contemplated hereby have been duly and validly authorized by all necessary corporate action on the part of the Company and no other corporate proceedings on the part of the Company are necessary to authorize such execution and delivery of this Agreement or consummation of the transactions contemplated hereby, except for the Common Stockholder Approval. This Agreement has been duly and validly executed and delivered by the Company and, assuming the due authorization, execution and delivery hereof by Parent and Merger Sub, constitutes a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as may be affected by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar Laws relating to or affecting creditors’ rights generally, general equitable principles (whether considered in a proceeding in equity or at law).

(b) At a meeting duly called and held, prior to the execution of this Agreement, at which all directors of the Company were present and voting in favor, the Company Board, acting upon the unanimous recommendation of the Special Committee, duly adopted resolutions, which, except as permitted by Section 6.03 after the date hereof, have not been subsequently terminated, rescinded, withdrawn, modified or amended in any way, (i) determining that this Agreement and the transactions contemplated hereby, including the Merger, are fair to, advisable and in the best interests of the Company and its stockholders, (ii) approving and declaring advisable this Agreement and the transactions contemplated hereby in accordance with the DGCL, (iii) authorizing the execution and delivery by the Company of, and the performance by the Company of its obligations under, this Agreement, and (iv) recommending that the stockholders of the Company adopt this Agreement (the actions in clause (iv), the “Company Board Recommendation”).

Section 3.04. No Conflict; Required Filings and Consents.

(a) Except as set forth in Section 3.04(a) of the Disclosure Schedule, the execution, delivery and performance of this Agreement by the Company and the consummation of the

transactions contemplated hereby do not and will not: (i) conflict with or violate the Organizational Documents; (ii) materially conflict with or materially violate any laws, statutes, codes, rules, regulations, ordinances, common laws or Orders of any Governmental Authority (collectively, “Laws”) applicable to the Company or any of its subsidiaries or by which its or any of their respective properties are bound (assuming that all consents, approvals and authorizations contemplated by clauses (i) through (vii) of subsection (b) below have been obtained and all filings described in such clauses have been made); or (iii) result in any material breach or material violation of, constitute a material default, require consent or result in the loss of a material benefit under, give rise to any increased payment or any penalty or premium under, give rise to any right of termination, amendment, acceleration or cancellation of (in each case, with or without notice or lapse of time or both) any material Contract to which the Company or any of its subsidiaries is a party, or by which the Company or any of its subsidiaries or its or any of their respective properties are bound, or result in the creation of a Lien, other than a Permitted Lien, on any of the properties or assets of the Company or any of its subsidiaries.

(b) The execution, delivery and performance of this Agreement by the Company and the consummation of the transactions contemplated hereby by the Company do not and will not require any permit, license, franchise, authorization, certification, exemption, tariff, consent, approval, concession or franchise (collectively, “Approvals”) from, action by, filing with or notification to, any Governmental Authority, except for (i) compliance with the applicable requirements of the Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder (the “Exchange Act”), or state securities, takeover and “blue sky laws,” (ii) filings and recordings as may be required under the DGCL in connection with the Merger, including the filing and recordation of the Certificate of Merger, (iii) compliance with applicable requirements of the Marketplace Rules of Nasdaq, (iv) filings, permits, authorizations, consents and approvals as may be required under the HSR Act, (v) any required filings with the U.S. Securities and Exchange Commission (the “SEC”) and Nasdaq, including the (A) Information Statement and, as applicable, the Proxy Statement, and (B) any such reports under Section 13(a) of the Exchange Act as may be required in connection with this Agreement and the Merger, (vi) filings and Healthcare Permits required by any healthcare regulatory Governmental Authority set forth on Section 3.04(b)(vi) of the Disclosure Schedule and (vii) such other Approvals, actions, filings or notifications of a type not referenced above the failure of which to be made or obtained would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

Section 3.05. SEC Filings; Financial Statements; Internal Controls.

(a) The Company has filed or furnished all forms, certifications, reports, schedules, declarations, statements, applications and other documents required to be filed with or furnished to the SEC by it prior to the date hereof and since July 1, 2013 (collectively, in each case as may have been amended since their filing, the “Company Reports”), each of which, as of their respective effective dates or filing dates, as applicable, and as amended prior to the date of this Agreement, complied in all material respects with the applicable requirements of the Securities Act of 1933 and the rules and regulations promulgated thereunder (the “Securities Act”), the Exchange Act, and the Xxxxxxxx-Xxxxx Act of 2002 (the “Xxxxxxxx-Xxxxx Act”), each as in effect on the date such Company Report was so filed or effective. Except to the extent that any information in any Company Report has been revised or superseded by a Company Report filed prior to the date hereof, none of the Company Reports (including any financial statements or

schedules included therein), when filed or furnished, contained any untrue statement of a material fact or omitted to state a material fact required to be stated or incorporated by reference therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. None of the Company’s subsidiaries is required to file any forms, reports or documents with the SEC under the Exchange Act. As of the date of this Agreement, there are no unresolved comments received by the Company from the Staff of the SEC with respect to any of the Company Reports.

(b) Each of the audited and unaudited financial statements (including any related notes) included in or incorporated by reference in the Company Reports, as amended or supplemented prior to the date hereof (collectively, together with all notes and schedule thereto, the “Financial Statements”), (i) complied as to form in all material respects with the applicable rules and regulations of the SEC with respect thereto when filed, (ii) was prepared in accordance with United States generally accepted accounting principles (“GAAP”) (except, in the case of unaudited quarterly statements, as permitted for purposes of Quarterly Reports on Form 10-Q) applied on a consistent basis throughout the periods involved (except as may be indicated in the notes thereto and subject, in the case of unaudited consolidated interim financial statements, to normal year-end audit adjustments and the absence of notes not required by GAAP) and (iii) fairly presents in all material respects the consolidated financial position of the Company and its subsidiaries as of the date thereof and the consolidated results of operations and cash flows of the Company and its subsidiaries for the period then ended (subject, in the case of unaudited interim Financial Statements, to normal year-end audit adjustments which, individually or in the aggregate, were not, and would not be reasonably expected to be, material).

(c) The Company has established and maintains disclosure controls and procedures (as such term is defined in Rule 13a-15 and Rule 15d-15 under the Exchange Act) sufficient for the Company and its subsidiaries to comply in all material respects with all applicable legal and accounting requirements required by Rule 13a-15 and Rule 15d-15 under the Exchange Act; such disclosure controls and procedures are reasonably designed to ensure that material information relating to the Company, including its consolidated subsidiaries, required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that all such material information is accumulated and communicated to the Company’s principal executive officer and its principal financial officer to allow timely decisions regarding required disclosure and to make the certifications required pursuant to Sections 302 and 906 of the Xxxxxxxx-Xxxxx Act regarding the Company’s and each of its subsidiaries’ disclosure controls and procedures. With respect to each Annual Report on Form 10-K, each Quarterly Report on Form 10-Q and each amendment of any such report included in the Company Reports filed after the effective date of the Xxxxxxxx-Xxxxx Act, the principal executive officer and the principal financial officer of the Company (or each former principal executive officer and each former principal financial officer of the Company) have made all certifications required by the Xxxxxxxx-Xxxxx Act and any related rules and regulations promulgated by the SEC. The Company has disclosed, based on its most recent evaluation of its disclosure controls and procedures prior to the date hereof, to the Company’s auditors and the audit committee of the Company Board (i) any significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which, at the time of such disclosure, were then reasonably likely to adversely affect in any material respect the Company’s

ability to record, process, summarize and report financial information and (ii) any fraud, whether or not material, that, at the time of such disclosure, involved management or other employees who then had a significant role in the Company’s internal controls over financial reporting. As used herein, the terms “significant deficiencies” and “material weaknesses” have the meaning assigned to them in Public Company Accounting Oversight Board Auditing Standard 2, as in effect on the date of this Agreement.

(d) Except (i) as set forth on Section 3.05(d) of the Disclosure Schedule, (ii) as reflected or reserved against in the Financial Statements, (iii) for liabilities and obligations incurred since May 31, 2016 (the “Balance Sheet Date”) in the ordinary course of business and consistent with past practice, none of which is a material liability for breach of contract, breach of warranty, tort or a violation of Law by the Company or any subsidiary of the Company, (iv) for liabilities or obligations that have been discharged or paid in full, (v) for liabilities and obligations (other than those incurred in the ordinary course of business, which are addressed by the foregoing clause (iii) and not this clause (v)), less than $1,500,000 in the aggregate, (vi) for liabilities incurred pursuant to this Agreement or in connection with the transactions contemplated hereby and (vii) for liabilities and obligations incurred under any executory Contract other than liabilities or obligations due to breaches by the Company or any subsidiary of the Company thereunder, neither the Company nor any subsidiary of the Company has incurred any liabilities or obligations of any nature that, whether or not accrued, contingent or otherwise and whether or not such liabilities or obligations would be required by GAAP to be recognized or disclosed on a consolidated balance sheet of the Company and its subsidiaries or in the notes thereto.

Section 3.06. Absence of Certain Changes or Events. Since the Balance Sheet Date through the date hereof,

(a) the Company and its subsidiaries have conducted their respective businesses in all material respects in the ordinary course of business consistent with past practice, except in connection with this Agreement and the transactions contemplated hereby,

(b) there has not been a Material Adverse Effect, and

(c) there has not been any event, condition, action or effect that would constitute a breach of Section 5.01(d), Section 5.01(e), Section 5.01(f), Section 5.01(h), Section 5.01(i), Section 5.01(j), Section 5.01(k), or Section 5.01(o) if such sections had been in effect from the Balance Sheet Date to the date hereof.

Section 3.07. Absence of Litigation. As of the date hereof, there are no material legal or administrative suits, claims, demands, actions, complaints, proceedings, litigation, arbitrations, mediations, charges, inquiries or investigations (“Actions”) pending or, to the Knowledge of the Company, threatened against the Company or any of its subsidiaries or any assets, properties or rights of the Company or any of its subsidiaries or, to the Knowledge of the Company, any of the executive officers or directors of the Company in their capacity as such, in each case by or before any Governmental Authority. As of the date hereof, there is no material order, writ, judgment, injunction, ruling, decree, determination, or award by any Governmental Authority (“Order”) with respect to the Company or any of its subsidiaries, nor any of their respective properties.

Section 3.08. Tax Matters.

(a) All material Tax Returns required to be filed by or with respect to the Company and its subsidiaries have been timely filed taking into account extensions validly obtained, and all such Tax Returns are complete and correct in all material respects. The Company and its subsidiaries have timely paid all material Taxes that are due, whether or not shown on any Tax Return, or that have been asserted in writing by any Governmental Authority to be due, from or with respect to it, except for matters contested in good faith or for which adequate reserves have been established in accordance with GAAP.

(b) There are no outstanding Contracts or waivers extending the statutory period of limitation applicable to any claim for, or the period for the collection or assessment of, Taxes due from or with respect to the Company or any subsidiary of the Company for any taxable period.

(c) No deficiencies for Taxes with respect to Company or any of its subsidiaries have been claimed, proposed or assessed by a Tax authority or other Governmental Authority in writing. No audit or other Action by any Governmental Authority has formally commenced and no written notification has been given to the Company or any subsidiary of the Company that such an audit or other Action is pending or threatened with respect to any material Taxes due from the Company or any subsidiary of the Company or any Tax Return filed by the Company or any subsidiary of the Company. Neither the Company nor any of its subsidiaries has been informed in writing by any jurisdiction that the jurisdiction believes that such entity was required to file any Tax Return in such jurisdiction that was not filed.

(d) Neither the Company nor any of its subsidiaries is a party to, bound by or has any obligation under, any Tax sharing, Tax indemnity or similar Contract (other than an agreement or arrangement solely among members of an affiliated group of which the Company is the common parent).

(e) Neither the Company nor any of its subsidiaries (i) is currently or has ever been a member of an affiliated group (other than a group the common parent of which is the Company or any of its subsidiaries) filing a consolidated federal income Tax Return or (ii) has any liability for the Taxes of any person (other than the affiliated group of which the Company is the common parent) under Treasury Regulations Section 1.1502-6 (or any similar provision of state, local or foreign Laws), or as a transferee or successor, by Contract or otherwise.

(f) Neither the Company nor any of its subsidiaries has been a “distributing corporation” or a “controlled corporation” (within the meaning of Section 355(a)(1)(A) of the Code) in connection with a distribution of stock qualifying for tax-free treatment under Section 355 of the Code at any time during the two (2) year period ending on the date of this Agreement.

(g) Neither the Company nor any of its subsidiaries has participated in any “listed transaction” within the meaning of Section 6707A(c)(2) of the Code and Treasury Regulations Section 1.6011-4(b)(2).

(h) The unpaid Taxes of the Company and its subsidiaries (i) did not, as of the Balance Sheet Date, materially exceed the reserve for Tax liability (rather than any reserve for deferred Taxes established to reflect timing differences between book and Tax income) set forth on the face of the Financial Statements (rather than any notes thereto) and (ii) do not materially exceed that reserve as adjusted for the passage of time through the Closing Date in accordance with the past custom and practice of the Company and its subsidiaries in filing their Tax Returns.

(i) The net operating losses or other tax attributes of the Company and each of its subsidiaries, prior to giving effect to the transactions contemplated by this Agreement, are not currently subject to any limitation under Section 382, 383 or 384 of the Code.

Notwithstanding any other representations and warranties in this Agreement, the representations and warranties in this Section 3.08 are the only representations and warranties in this Agreement with respect to Taxes.

Section 3.09. Employee Benefit Plans; ERISA.

(a) Section 3.09(a) of the Disclosure Schedule contains a complete and correct list of each “employee benefit plan” (within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974 (“ERISA”)) (including “multiemployer plans” (within the meaning of ERISA Section 3(37))), stock purchase, stock option, stock ownership, other equity or equity-based compensation, severance, employment, retirement, pension, profit sharing, change-of-control, fringe benefit, vacation, disability, death benefit, hospitalization, medical, collective bargaining, bonus, incentive, deferred compensation and all other employee benefit plans, programs, policies or other arrangements, whether or not subject to ERISA (including any funding mechanism therefor now in effect or required in the future as a result of the transaction contemplated by this Agreement or otherwise), sponsored, maintained, contributed to or required to be maintained or contributed to by the Company or any of its subsidiaries or with respect to which the Company or any of its subsidiaries would reasonably be expected have any present or future material liability. All plans, programs, policies and arrangements required to be set forth in Section 3.09(a) of the Disclosure Schedule are collectively referred to as the “Company Plans.” Any current or former employee, consultant, independent contractor of the Company or any of its subsidiaries is referred to as a “Company Employee.”

(b) All Company Plans that are intended to qualify under Section 401(a) of the Code and any trust agreement that is intended to be tax exempt under Section 501(a) of the Code have been determined by the Internal Revenue Service to be qualified under Section 401(a) of the Code and exempt from taxation under Section 501(a) of the Code (or there remains a period of time under the applicable remedial amendment period with respect to such a Company Plan to request such a determination), and, to the Knowledge of the Company, nothing has occurred and no circumstances exist since the date of such letter which would reasonably be expected to adversely affect the qualified status of such plan.

(c) Neither the Company nor any subsidiary or ERISA Affiliate of the Company has, since July 1, 2013, contributed or has been obligated to contribute to, nor do any of them have any liability, contingent or otherwise, with respect to, any “employee pension plans”, as defined in Section 3(2) of ERISA, subject Title IV of ERISA or Section 412 of the Code, including a

“multiemployer plan”, as defined in Section 4001(a)(3) of ERISA. Since July 1, 2013, neither the Company nor any ERISA Affiliate has maintained, established, sponsored, participated in, or contributed to a “funded welfare plan” within the meaning of Section 419 of the Code, a “voluntary employee beneficiary association” as defined in Section 501(c)(9) of the Code, a “multiple-employer welfare arrangement” as defined in Section 3(40) of ERISA or “employee stock ownership plan” as defined in Section 4975(e)(7) of the Code. With respect to each Company Plan set forth on Section 3.09(a) of the Disclosure Schedule, (i) the Company, its subsidiaries and their respective ERISA Affiliates have complied in all material respects with the minimum funding requirements of Sections 412 of the Code and 302 of ERISA, and there have been no applications for variance from minimum funding standards (as described in Section 412(c) of the Code or Section 302(c) of ERISA), (ii) there have been no material violations of the applicable benefits restrictions under Section 436 of the Code, (iii) no Lien on the assets of the Company, its subsidiaries or their respective ERISA Affiliates has arisen under ERISA or the Code, nor is such Lien expected to arise, (iv) no event described in Section 4043 (excluding events with respect to which reporting was waived) or 4062(e) of ERISA nor any transaction described in Section 4069 of ERISA has occurred or is reasonably expected to occur, and (v) all premiums described in Section 4006 of ERISA payable to the Pension Benefit Guaranty Corporation under Section 4007 of ERISA have been timely paid. Note of the Company, any of its subsidiaries or any of their respective ERISA Affiliates is party to any agreement intended to comply with Section 4204 of ERISA.

(d) With respect to each Company Plan, the Company has delivered or made available to Merger Sub a complete and correct (or, to the extent no such copy exists, an accurate description) copy of the plan document relating to such plan and, to the extent applicable, (i) any related trust agreement, annuity contract or other funding instrument; (ii) the most recent determination letter or opinion letter issued by the Internal Revenue Service with respect to such plan; (iii) the most recent summary plan description prepared with respect to such Company Plan and other written communications by the Company that modify in any significant respect the benefits provided under the terms of any Company Plan in a manner not reflected in any of the documents provided pursuant to this Section 3.09(d); (iv) the three (3) most recent (A) annual reports on Form 5500 filed with the Internal Revenue Service and attached schedules, (B) audited financial statements and (C) actuarial valuation reports; (v) the results of the non-discrimination testing for each of the three (3) most recently completed years; (vi) all material correspondence with a Governmental Authority since July 1, 2013; and (vii) the results of the Company’s Section 280G analysis.

(e) All Company Plans are in material compliance with and have been administered in all material respects in form and operation in accordance with their terms and all requirements of applicable Laws, including the Code and ERISA, and none of the Company nor any of its subsidiaries has received any written claim or notice that any such Company Plan is not in compliance with its terms and all applicable Laws, regulations, rulings and other authority issued thereunder. There are no Actions pending (other than routine claims for benefits) or, to the Knowledge of Company, threatened alleging any breach of the terms of any Company Plan or of any fiduciary duties thereunder or violation of any applicable Law with respect to any such plan.

(f) All contributions, premiums and other payments required by Law or any Company Plan to have been made under any such plan to any fund, trust or account established thereunder or in connection therewith have been made by the due date thereof.

(g) Neither the execution and delivery of this Agreement nor the consummation or performance of any of the transactions contemplated by this Agreement, whether alone or in combination with any other event, shall result in (i) the payment to any Company Employee of any money or other property, or forgiveness of indebtedness of any Company Employee, (ii) the provision of any benefits or other rights of any individual or (iii) the increase, acceleration of vesting or provision of any payments, benefits or other rights provided to or for the benefit of any Company Employee (including the acceleration of any funding obligations), whether or not any such payment, right, benefit, increase, acceleration or provision could constitute a “parachute payment” within the meaning of Section 280G of the Code.

(h) None of the payments contemplated by the Company Plans or any other agreements to which the Company or any of its subsidiaries is a party, would, individually or in the aggregate, whether alone or in combination with any other event, constitute excess parachute payments (as defined in Section 280G of the Code (without regard to subsection (b)(4) thereof)) or would exceed the amount deductible pursuant to Section 162(m) of the Code. No individual has been promised any “gross-up” payment for excise taxes imposed by Section 280G and 4999 of the Code.

(i) There has been no amendment to, written interpretation of or announcement by the Company or any of its subsidiaries relating to, or any change in employee participation or coverage under, any Company Plan that would materially increase the expense of maintaining such Company Plan above the level of the expense incurred in respect thereof for the most recent fiscal year ended prior to the date of this Agreement.

(j) No Company Plan provides health, medical or other welfare benefits after retirement or other termination of employment (other than for continuation coverage required under Section 4980(B)(f) of the Code or applicable Law for which the covered individual pays the full cost of coverage). To the Knowledge of the Company, there has been no communication (whether oral or written) to any Company Employee that would reasonably be expected to promise or guarantee any such health, medical, or other welfare benefits after retirement or other termination of employment.

(k) Each Company Plan that is subject to Section 409A of the Code has been administered in compliance in all material respects with its terms and the operational and documentary requirements of Section 409A of the Code and all applicable Internal Revenue Service guidance (including notices, rulings and proposed and final regulations) promulgated thereunder.

(l) Each Company Plan that is also a “group health plan” for purposes of the Patient Protection and Affordable Care Act of 2010 (Pub. L. No. 111-148) and the Health Care and Education Reconciliation Act of 2010 (Pub. L. No. 111-152) (collectively, with the regulations and guidance issued thereunder, the “Affordable Care Act”) is in material compliance with the applicable terms of the Affordable Care Act. Neither the Company nor any ERISA Affiliate has ever maintained, established, sponsored, participated in, or contributed to any Company Plan

outside of the United States. The Company offers minimum essential health coverage, satisfying affordability and minimum value requirements, to its full-time employees sufficient to prevent liability for assessable payments under Sections 4980H(a) and 4980H(b) of the Code.

Section 3.10. Labor Matters.

(a) Section 3.10(a) of the Disclosure Schedule contains a complete and accurate list of the name, employee identification number, job title, base salary or wage rate, target incentive compensation (as applicable), commission rate (as applicable), bonus or commissions payments in the last two (2) years, other compensation, accrued or granted but unused paid leave balance, date of commencement of employment, work location, full time or part time status, exempt or non-exempt status, temporary or permanent status, status as a regular or leased employee, status as an active or inactive employee, and date of commencement of leave (as applicable) of each employee, officer, and director of the Company and any of its subsidiaries as of the date of this Agreement (or as of a day within the period of the five (5) days prior to the date of this Agreement).

(b) None of the Company Employees are, or have been since July 1, 2013, represented by any union with respect to their employment by the Company or such subsidiary. To the Knowledge of the Company, no labor organization or group of employees of the Company or any of its subsidiaries has made a demand for recognition or certification to the Company or any of its subsidiaries and there are no representation or certification proceedings or petitions seeking a representation proceeding presently pending or threatened to be brought or filed with the National Labor Relations Board or any other Governmental Authority, nor have any such demands, proceedings or petitions occurred since July 1, 2013. Since July 1, 2013, neither the Company nor any of its subsidiaries has experienced any union organization attempts, threatened strikes, work stoppages, slowdowns, lockouts, concerted refusals to work overtime, or other labor disputes.

(c) Except as set forth on Section 3.10(c) of the Disclosure Schedule, since July 1, 2013, the Company and each of its subsidiaries is, and during such period, has been, in compliance in all material respects with all applicable Employment Laws.

(d) Since July 1, 2013, neither the Company nor any of its subsidiaries has conducted a “mass layoff,” “relocation,” “plant closing,” or “termination” as defined by the federal Worker Adjustment and Retraining Notification Act, or any similar applicable state or local Law that requires advance notice of group personnel or employment actions.

(e) Except as set forth on Section 3.10(e) of the Disclosure Schedule, there is (i) no unfair labor practice charge or complaint against the Company or any of its subsidiaries pending before the National Labor Relations Board or any similar state or local agency relating to an alleged material violation or material breach of any Employment Laws or (ii) no material Action pending or, to the Knowledge of the Company, threatened against the Company or any of its subsidiaries concerning employment-related matters, the Company Employees or a material violation of any Employment Laws or a material breach of any contractual obligations, including any material Actions pending with, or threatened in writing by, the Equal Employment Opportunity Commission, the Department of Labor, the Internal Revenue Service, the National Labor Relations Board, or any other Governmental Authority.

(f) To the Knowledge of the Company, no Company Employee is in violation in any material respect of any employment contract, confidentiality, non-competition, non-solicitation, or other proprietary rights agreement or any other contract relating to the right of such person to be employed by, or provide services to, the Company or any of its subsidiaries.

Section 3.11. Environmental.

(a) The Company and each of its subsidiaries is, and since July 1, 2013, has been, in compliance in all material respects with all applicable Environmental Laws.

(b) The Company and its subsidiaries have duly obtained, maintain, and are in compliance, in all material respects with, all material Approvals required under applicable Environmental Laws, and all such Approvals are valid and in good standing, and there is no action pending or, to the Knowledge of the Company, threatened to revoke, cancel, modify, suspend or terminate any such Approval.

(c) Neither the Company nor any of its subsidiaries has received any notice of any Order relating to or arising under Environmental Laws that is outstanding or unresolved and there is no pending or, to the Knowledge of the Company, threatened Action relating to any actual or alleged material violation of or material liability under Environmental Laws or with respect to the Release, disposal, transportation, spill, cleanup, investigation or other discard of Hazardous Materials.

(d) Neither the Company nor its subsidiaries has Released or arranged for the disposal or treatment of any Hazardous Materials in a manner that would reasonably be expected to give rise to material liabilities pursuant to any applicable Environmental Law.

(e) To the Knowledge of the Company, there is not on, in, under or from any Company Real Property: (i) any leaking underground storage tanks; (ii) any asbestos-containing materials or lead-based paint that must be removed or abated under applicable Environmental Laws; (iii) any landfills, dumps or surface impoundments used to treat or dispose of Hazardous Materials; or (iv) any other Hazardous Material that would reasonably be expected to give rise to material liabilities pursuant to any applicable Environmental Law.

(f) The Company and each of its subsidiaries has made available to Parent copies of all material environmental assessments, environmental reports, environmental audits and other material environmental documents in its possession or under its reasonable control related to any non-compliance by the Company or its subsidiaries, in any material respect, since July 1, 2013 or that is currently outstanding or unresolved with Environmental Laws or the environmental condition of any real property that the Company or its subsidiaries currently or formerly have owned, operated or leased.

Section 3.12. Compliance with Applicable Laws; Approvals from Governmental Authorities. Except as set forth in Section 3.12 of the Disclosure Schedule, (a) the Company and each of its subsidiaries and their relevant personnel and operations are, and since July 1, 2013,

have been, in compliance in all material respects with all Laws applicable to them or by which any of their respective properties are bound, (b) neither the Company nor any of its subsidiaries has received written notice of any material violation of any Law applicable to the Company or any of its subsidiaries or by which any of their respective properties are bound, (c) the Company and its subsidiaries have, and are in compliance in all material respects with, all Approvals from any Governmental Authority necessary to conduct their businesses as now being conducted and to own, lease or operate their properties and assets, and there has occurred no material violation of, material default (with or without notice or lapse of time or both) under, or event giving to any person any right of termination, amendment or cancellation (with or without notice or lapse of time or both) of any such Approval and (d) neither the Company nor any of its subsidiaries has received written notice of any suspension, limitation, cancellation, revocation, modification of or refusal to renew any Approval from any Governmental Authority material to the Company and its subsidiaries taken as a whole. No representation or warranty is made in this Section 3.12 with respect to (i) compliance with the Securities Act and the Exchange Act, which is covered solely in Section 3.05, (ii) compliance with applicable Tax Laws, which is covered solely in Section 3.08, (iii) compliance with ERISA and other applicable Laws relating to employee benefits, which is covered solely in Section 3.09, (iv) compliance with applicable Employment Law matters, which is covered solely in Section 3.10, (v) compliance with applicable Environmental Laws, which is covered solely in Section 3.11, (vi) compliance with applicable Healthcare Laws, which is covered solely in Section 3.22 and Section 3.23 or (vii) compliance with applicable Information Privacy and Security Laws, which is covered solely in Section 3.24.

Section 3.13. Contracts.

(a) Section 3.13 of the Disclosure Schedule contains a correct and complete list of each of the following types of Contracts (including all modifications or amendments thereto) to which the Company or any of its subsidiaries is a party, or by which the Company or any of its subsidiaries or its or any of their respective properties are bound as of the date of this Agreement:

(i) any Contract that is or would be required to be filed by the Company as a “material contract” pursuant to Item 601(b)(10) of Regulation S-K under the Securities Act;

(ii) any Contract with any third party involving expenditures, liabilities or revenues in excess of $150,000 per year;

(iii) any material Contract between the Company or any of its subsidiaries, on the one hand, and any officer of the Company or any of its subsidiaries, on the other hand;

(iv) any Contract containing covenants restricting the Company or any of its subsidiaries (or, after the Closing, Parent or its subsidiaries) (A) from engaging in any line of business or competing with any person or operating at any location or hiring or soliciting for employment any person, or (B) requiring the disposition of any assets or line of business of the Company or any of its subsidiaries other than in the ordinary course of business (or, after the Closing, Parent or its subsidiaries);

(v) any Contract that contains any “most favored nation” provisions granted by the Company or any of its subsidiaries or pursuant to which the Company or any of its subsidiaries is (or, after the Closing, Parent or its subsidiaries would be) restricted from entering any territory, market or field or freely engaging in business anywhere in the United States of America and that is material to the Company or its subsidiaries taken as a whole;

(vi) any Contract that provides for continuing indemnification extending after the Closing by the Company or any of its subsidiaries of any person, except for any such Contract that is entered into in the ordinary course of business consistent with past practice;

(vii) any Contract with any third party that relates to the formation, creation, operation, management or control of any joint venture, limited liability company, partnership, profit sharing, joint development or other similar arrangement;

(viii) any Contract for the acquisition or disposition (by merger or otherwise), of any of the material assets or properties of the Company or any of its subsidiaries or any capital stock or other equity interests of any other person for aggregate consideration in excess of $250,000, with rights or obligations that remain outstanding, other than Contracts for the procurement or sale of assets or properties in the ordinary course of business consistent with past practice;

(ix) any Contract (A) evidencing Indebtedness by the Company or any of its subsidiaries having an outstanding or committed amount in excess of $100,000, other than (1) Indebtedness solely between or among any of the Company and any of its subsidiaries and (2) trade payables incurred in the ordinary course of business, or (B) relating to the mortgaging, pledging or otherwise placing of a Lien on any material asset or material group of assets of the Company or any of its subsidiaries, except for Permitted Liens;

(x) any Contract under which the Company or any of its subsidiaries has advanced or loaned any amount to, or guaranteed any obligations of, any third party (excluding, for avoidance of doubt, trade accounts receivable incurred in the ordinary course of business);

(xi) any Contract for the license or sublicense (whether as a licensor or a licensee) of any Intellectual Property or other intangible asset (excluding commercial off-the-shelf or shrink wrap software than has not been modified or customized), that provides for payment or receipt of $100,000 or more in each year of such Contract;

(xii) any collective bargaining agreement with any labor organization;

(xiii) any Contract under which any benefits to any Company Employee or officer or director of the Company or any of its subsidiaries will be materially increased, or the vesting of material benefits to any Company Employee or officer or director of the Company or any of its subsidiaries will be accelerated, in connection with the Merger;

(xiv) any executory Contract with any Material Payor;

(xv) any executory Contract with any Governmental Authority, including with respect to a Federal Health Care Program, that is material to the Company and its subsidiaries, taken as a whole;

(xvi) any lease or rental Contract involving real property or personal property and payments in excess of $100,000 per year; and

(xvii) any Contract that would prohibit or materially delay the consummation of the Merger or any of the transactions contemplated hereunder;

provided, that (1) any Transaction Documents and (2) any Company Plans or agreements documenting any awards granted pursuant to such Company Plans shall not be required to be listed in Section 3.13 of the Disclosure Schedule and shall not be deemed a “Material Contract” for any purposes hereunder (whether or not filed pursuant to Item 601(b)(10) of Regulation S-K under the Securities Act). The term “Material Contract” shall include: (x) each Contract of the type described in clauses (i) through (xvii), (y) each BAA, and (z) each Contract pursuant to which the Company licenses to or from a third party any Personal Information or any data derived from Personal Information for a commercial purpose.

(b) Each Material Contract is (1) valid and binding on the Company and each of its subsidiaries party thereto and, to the Company’s Knowledge, each other party thereto, and (2) in full force and effect and enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of general applicability relating to or affecting creditors’ rights and to general equity principles. The Company and each of its subsidiaries has performed in all material respects all obligations required to be performed by it under each Material Contract and has not materially violated or defaulted under, and no event has occurred that with the lapse of time or the giving of notice or both would constitute a material violation or default under, each Material Contract. To the Company’s Knowledge, each other party to each Material Contract has performed in all material respects all obligations required to be performed by it under such Material Contract and has not materially violated or defaulted under, and no event has occurred that with the lapse of time or the giving of notice or both would constitute a material violation or default under, each Material Contract. None of the Company or any of its subsidiaries knows of, or has received written notice of, any material violation or default under (or any condition which with the passage of time or the giving of notice would cause such a violation of or default under) any Material Contract. The Company has made available to Parent for review, prior to the execution of this Agreement, true and complete copies of all of the Material Contracts, which are not filed as exhibits to the Company Reports, and the Material Contracts filed as exhibits to the Company Reports are true and complete copies of such Contracts.

Section 3.14. Interested Party Transactions; Company Advances. Since April 29, 2016 to the date hereof, except for the transactions contemplated by this Agreement, no event has occurred that would be required to be reported by the Company pursuant to Item 404 of Regulation S-K. Section 3.14 of the Disclosure Schedule sets forth, as of the date of this Agreement, a true and correct list of all loans made by the Company to any Company Employees, including the current outstanding balance thereunder.

Section 3.15. Brokers. No broker, finder or investment banker, other than the Financial Advisor, the fees and expenses of which shall be paid by the Company, is entitled to any brokerage, finder’s, financial advisor’s or other fee or commission in connection with the transactions contemplated hereby based upon arrangements made by or on behalf of the Company or any of its subsidiaries. True and correct copies of all agreements between the Company and the Financial Advisor concerning this Agreement and the transactions contemplated hereby, including any fee arrangements, have been previously made available to Parent.

Section 3.16. Company Vote Required. The only vote or consent of holders of any class of capital stock of the Company necessary to adopt this Agreement is the affirmative vote of holders of a majority of the outstanding shares of Company Common Stock entitled to vote thereon, voting as a single class (such vote or consent, “Common Stockholder Approval”). UANT Ventures, L.P. (“Ventures”) is the holder of a majority of the outstanding shares of Company Common Stock.

Section 3.17. Intellectual Property.

(a) The Company or its subsidiaries exclusively owns free and clear of all Liens (except for Permitted Liens) and exclusively licenses or has the defensible right to use, pursuant to a valid and enforceable written agreement, all material Intellectual Property used in or held for use in the businesses of the Company or any of its subsidiaries as currently conducted (“Company Intellectual Property”). The Company Intellectual Property constitutes all material Intellectual Property used in the conduct of the business of the Company and its subsidiaries as currently conducted, and the Company and each of its subsidiaries has valid, sufficient and enforceable rights to such Company Intellectual Property.

(b) As of the date hereof, no written claim of invalidity or conflicting ownership rights has been made or, to the Knowledge of the Company, threatened by a third party with respect to any Company Intellectual Property and no Company Intellectual Property is the subject of any pending or, to the Knowledge of the Company, threatened Action challenging or other orders, judgments or agreements restricting the Company’s ownership rights in or use of such Company Intellectual Property. Except as set forth in Section 3.17(b) of the Disclosure Schedule, there are no royalties or fees payable by the Company or any of its subsidiaries by reason of the ownership, development, use, license, sublicense, sale, distribution or other disposition of the Company Intellectual Property, in each case, in the ordinary course of business. As of the date hereof, no registration for or application to register any Company Intellectual Property (“Registered Intellectual Property”) has been cancelled, abandoned or adjudicated invalid, and all Registered Intellectual Property is subsisting and in good standing, except where such cancellation or abandonment was made in the ordinary course of business and would not have or reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. Section 3.17(b) of the Disclosure Schedule sets forth a complete and accurate list of (i) all Registered Intellectual Property, if any, indicating for each such item the registration or application number and the applicable filing jurisdiction, and (ii) all material unregistered trademarks, service marks, and copyrights (including Software) owned by the Company or any of its subsidiaries.

(c) To the Knowledge of the Company, the conduct of the business of the Company and its subsidiaries (including their respective products and services), as currently conducted, does not infringe or misappropriate the Intellectual Property rights of any person. As of the date hereof, no person has given written notice to the Company or any of its subsidiaries or, to the Knowledge of the Company, has threatened that the conduct of such business (including such products and services) is infringing or has infringed any person’s Intellectual Property rights, or that the Company or any of its subsidiaries has misappropriated or violated such person’s trade secrets. To the Knowledge of the Company, no valid basis exists for any such claim or notice. To the Knowledge of the Company, none of the Company Intellectual Property has been or is currently being infringed, misappropriated or otherwise violated by any third party, and no such claims have been made by the Company or any of its subsidiaries.

(d) The Company and each of its subsidiaries have taken commercially reasonable measures to safeguard the confidentiality of all Company Intellectual Property comprising trade secrets or other confidential information, and to the Knowledge of the Company no unauthorized use or disclosure of any such trade secrets or material confidential information has occurred.

(e) To the Knowledge of the Company, the execution, delivery and performance of this Agreement by the Company and the consummation of the transactions contemplated hereby will not breach, violate or conflict with any instrument or agreement concerning the Company’s or any of its subsidiaries’ use of or rights to any Company Intellectual Property, will not cause the forfeiture or termination of or other modification to, or give rise to a right of forfeiture or termination of or other modification to, any rights in or to the Company Intellectual Property, or impair any right of Parent or the Surviving Corporation to (i) any Company Intellectual Property and (ii) make, use, sell, license or dispose of, or to bring any action for the infringement of, any Company Intellectual Property, all in the same form and manner as the Company or any of its subsidiaries has prior to the date hereof.

(f) Section 3.17(f) of the Disclosure Schedule lists all third party Intellectual Property licensed by the Company (“Licensed Intellectual Property”) requiring payments in excess of $100,000 per year, other than commercially available “off the shelf” Software that has not been modified or customized.

(g) Except for those physicians who executed certain physician employment agreements with the Company, no current or former officers or directors of the Company and its subsidiaries, or any current or former employees or consultants of the Company and its subsidiaries who are or were at any time involved in the design, development or implementation of material Company Intellectual Property for or on behalf of the Company or any of its subsidiaries, or who may be or were exposed to any trade secret or confidential know-how of the Company or any of its subsidiaries, have executed and delivered to the Company or one of its subsidiaries, as applicable, an agreement assigning to the Company or subsidiary their entire right, title and interest in and to such Intellectual Property and protecting the secrecy, confidentiality and value of such trade secrets and confidential information. Section 3.17(g) of the Disclosure Schedule identifies by name, and employer, all individuals who have participated in the design, development or implementation of Company Intellectual Property for or on behalf of the Company or any of its subsidiaries.

(h) The Company and its subsidiaries have sufficient rights to use all material computer software, middleware and systems, information technology equipment, and associated documentation used in connection with the operation of the business of the Company and its subsidiaries (the “IT Assets”), all of which rights shall survive unchanged the consummation of the transactions contemplated hereby.

(i) Section 3.17(i) of the Disclosure Schedule lists all Software that is distributed as “open source software” or under a similar licensing or distribution model (collectively, “Open Source Software”) that has been incorporated into and/or distributed with any products or services of the Company or any of its subsidiaries in any way.

(j) Section 3.17(j) of the Disclosure Schedule lists all source code of any Software owned or controlled by the Company or any subsidiary that has been licensed or otherwise provided to any third party, and describes the purpose of any such license or provision, the scope of any such license or use by any such third party of the provided source code, and the restrictions on use and/or disclosure of such source code by any such third party. Except for authorized employees of the Company or its subsidiaries who access or use source code owned or controlled by the Company or any subsidiary in the course of their authorized activities or employment, no person has any right to access or use any source code owned or controlled by the Company or any subsidiary.

Section 3.18. Insurance. All material insurance policies to which any of the Company and its subsidiaries is either an insured or a beneficiary and all insurance policies for any managed entities of the Company or any of its subsidiaries that the Company or any of its subsidiaries is required to maintain (the “Insurance Policies”) are with reputable insurance carriers (other than existing self-insurance) and maintain in such amounts and cover such risks as the Company reasonably believes are in accordance with normal industry practice for companies engaged in businesses similar to that of the Company and its subsidiaries. Except as would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, (a) all premiums due and payable in respect of each Insurance Policy have been paid, (b) neither the Company nor any of its subsidiaries is in breach or default of any of the Insurance Policies and neither the Company nor any of its subsidiaries has taken any action or failed to take any actions which, with notice or the lapse of time, would constitute such a breach or default or permit termination or modification of any of the Insurance Policies, (c) none of the Company and its subsidiaries has received written notice from any insurer or agent of any intent to cancel, terminate or deny coverage under any such Insurance Policy, and (d) the Insurance Policies are valid and enforceable policies. Section 3.18 of the Disclosure Schedule lists each of the Insurance Policies and sets forth for each such Insurance Policy the (i) policy type, (ii) insurance carrier name, (iii) insured entity(ies), (iv) effective date, (v) limits of liability, (vi) deductible/self-insured retention, (vii) policy number, and (viii) premium.

Section 3.19. Property.

(a) Personal Property. Each of the Company and its subsidiaries has good and valid title to, or, in the case of leased tangible personal properties and assets, valid leasehold interests in, all of the material tangible personal properties and assets used in the conduct of the business of the Company and its subsidiaries as currently conducted. All of the Company’s and each of its subsidiaries’ material tangible personal properties and assets are free and clear of any Lien, except for Permitted Liens.

(b) Real Property. Neither the Company nor any of its subsidiaries owns any real property. Section 3.19(b) of the Disclosure Schedule identifies all land, buildings and structures leased or otherwise occupied by the Company or its subsidiaries as lessee, sublessee or licensee (the “Leased Real Property”) including the street address, the title and date of the lease, sublease or other occupancy agreement to which the Company or its subsidiaries is a party, the name of the entity holding such leasehold, subleasehold or other occupancy interest, and the name of the other parties thereto (such Leased Real Property, including all improvements thereon, referred to collectively as the “Company Real Property”). The Company Real Property set forth in Section 3.19(b) of the Disclosure Schedule comprises all of the material real property currently used in the operation of the business of the Company and its subsidiaries as of the date hereof.

(c) The Company has made available to Parent and Merger Sub true and complete copies of (i) the Company’s headquarters lease for premises leased in the building located at 0000 Xxxxx Xxxxx Xxxxxxx 000, Xxxxx 000, Xxxxxx, Xxxxx, (ii) real property leases for sites at which the Company’s hospitals, cancer treatment centers and primary care and specialty clinics are located and (iii) all other real property leases for any real property used and occupied by the Company or its subsidiaries (collectively, the “Company Leases”). The Company and its subsidiaries have a valid leasehold interest in each Leased Real Property, and each Company Lease is in full force and effect (except to the extent it has expired or been terminated in accordance with its terms) and is a legal, valid and binding obligation of the Company or its subsidiaries and is enforceable against the Company or its subsidiaries in accordance with its terms except that (i) such enforcement may be subject to applicable bankruptcy, insolvency or other similar Laws of general applicability, now or hereafter in effect, affecting creditors’ rights generally, and (ii) the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. The Company and its subsidiaries have not exercised or given notice of exercise, nor, to the Knowledge of Company, has any lessor or landlord exercised or given any notice of exercise, of any option, right or first offer or right of first refusal contained in any Company Lease. Neither the Company nor any of its subsidiaries nor, to the Knowledge of the Company, any other party to any Company Lease, is in material breach of or in material default under any of the Company Leases and, to the Knowledge of the Company, no event has occurred or circumstance exists which, with the delivery of notice, the passage of time, or both, would constitute a material breach or material default under any Company Lease on the part of the Company or its subsidiaries, nor to the Knowledge of the Company, any other party to any Company Lease. The Company’s or its subsidiaries’ leasehold interest in each Leased Real Property is free and clear of all Liens, except for Permitted Liens. The Company does not owe any material brokerage commissions or material finder’s fees with respect to any Company Leases.

(d) Section 3.19(d) of the Disclosure Schedule sets forth, as of the date hereof, a true and complete list of all leases, subleases or similar agreements relating to any Company Real Property under which the Company or any of its subsidiaries is the landlord or the sublandlord other than leases, subleases and similar agreements that do not provide for annual rent in excess

of $100,000 (such leases, subleases and similar agreements, collectively, the “Real Property Subleases”). Each Real Property Sublease is valid and binding on the Company or its subsidiaries party thereto and each Real Property Sublease is in full force and effect (except to the extent it has expired or been terminated in accordance with its terms) and is a legal, valid and binding obligation of the Company or its subsidiaries and is enforceable against the Company or its subsidiaries in accordance with its terms except that (i) such enforcement may be subject to applicable bankruptcy, insolvency or other similar Laws of general applicability, now or hereafter in effect, affecting creditors’ rights generally, and (ii) the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

(e) As of the date hereof, there are no condemnation or compulsory purchase proceedings pending or, to the Knowledge of the Company, threatened with respect to any portion of the Company Real Property that would reasonably be likely to materially impair or materially interfere with the continued use and operation of Company Real Property in the business of the Company and its subsidiaries as currently conducted; and the Company has received no written notice indicating that any of the Company Real Property or the condition or operation of the Company’s or its subsidiaries’ business, or any of the buildings, structures, fixtures and other improvements thereon contravenes or violates in any material respect any building, zoning, fire safety, health safety or other applicable Law.

(f) All certificates of occupancy, permits, licenses, franchises, approvals and authorizations (collectively, the “Real Property Permits”) of all Governmental Authorities, boards of fire underwriters, associations or any other person having jurisdiction over the Company Real Property that are required to use or occupy the Company Real Property or operate the Company’s business as currently conducted thereon, have been issued and are in full force and effect, except where the failure of the Company to obtain or maintain such Real Property Permits would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

Section 3.20. Certain Payments. Neither the Company nor any of its subsidiaries (nor, to the Knowledge of the Company, any of their respective directors, executives, representatives, agents or employees, in each case, acting for or on behalf of the Company or its subsidiaries, as applicable) (a) has used or is using any corporate funds for any illegal contributions, gifts, entertainment or other unlawful expenses relating to political activity, (b) has used or is using any corporate funds for any direct or indirect unlawful payments to any foreign or domestic governmental officials or employees, (c) has violated or is violating any provision of the Foreign Corrupt Practices Act of 1977, (d) has established or maintained, or is maintaining, any unlawful fund of corporate monies or other properties or (e) has made any bribe, unlawful rebate, payoff, influence payment, kickback or other unlawful payment of any nature.

Section 3.21. Healthcare Permits. All Healthcare Permits applicable to the Company, each of its subsidiaries, and, to the Knowledge of the Company each of the Company Employees that are required for the operation of the Company and its subsidiaries: (a) have been obtained, are in effect and are set forth in Section 3.21 of the Disclosure Schedule, (b) are valid and in good standing in each jurisdiction in which such Healthcare Permits were issued or are operable, and (c) have not been subject to revocation or forfeiture.

Section 3.22. Participation in Governmental and Other Third Party Payor Programs.

(a) Section 3.22 of the Disclosure Schedule lists all provider numbers for the Company and each subsidiary of the Company that participates in any Federal Health Care Program. Since July 1, 2013, there have been no audits, or investigations, and, to the Knowledge of the Company, no event has occurred or facts exist which reasonably might be expected to result in the revocation, suspension, termination, probation, restriction, limitation, nonrenewal or other materially adverse modification of the participation of the Company, any subsidiary, or, to the Knowledge of the Company, any Company Employee, in any Federal Health Care Program.

(b) Since July 1, 2013, neither the Company nor any of its subsidiaries and none of their respective directors, officers, employees and, to the Knowledge of the Company, independent contractors, has been (i) debarred, excluded or suspended from participating in any Federal Health Care Program, (ii) subject to a civil monetary penalty assessed under Section 1128A of the Social Security Act or (iii) listed on the General Services Administration published list of parties excluded from federal procurement programs and non-procurement programs. There is no action pending, or, to the Knowledge of the Company, threatened, which has resulted in or would reasonably be expected to result in any revocation, suspension, termination, probation, material restriction, material limitation, non-renewal or other materially adverse modification (excluding routine audits or adjustments in the ordinary course of business) of the participation by the Company or any subsidiary in any Third Party Payor Program or of any supplier or provider number, or result in the Company’s or any of its subsidiaries’ exclusion from any Third Party Payor Program.

(c) The Company and each of its subsidiaries that participates in any Federal Health Care Program is duly enrolled and certified therein, and has the requisite provider and supplier numbers to xxxx the Medicare program, the respective Medicaid program in the state or states in which such entity operates, and all other Third Party Payor Programs that the Company or each of such subsidiaries currently bills to such programs. The Company and each of its subsidiaries is operating and, since July 1, 2013, has operated in material compliance with all Third Party Payor Program rules and regulations and all provisions of each Third Party Payor Program contract to which it is a party or by which it is bound.

(d) Neither the Company nor any of its subsidiaries is party to an individual or corporate integrity agreement with the Office of the Inspector General of the United States Department of Health and Human Services or otherwise has any continuing reporting obligations pursuant to any deferred prosecution, settlement or other agreement with any Governmental Authority.

(e) The Company and each of its subsidiaries has, since July 1, 2013, (i) timely filed all reports required to be filed with respect to each Third Party Payor Program, all of which were prepared and filed in compliance with applicable Laws and applicable payor requirements, except as would not reasonably be expected to result in material liability to the Company or its subsidiaries, taken as a whole, and (ii) paid all material known and undisputed refunds and overpayments due with respect to any such report. All claims submitted by or on behalf of the Company or any of its subsidiaries have been submitted in material compliance with applicable

Laws and the rules, regulations, policies and procedures of the applicable third party payors, except as has not resulted in, and would not reasonably be expected to result in, material liability to the Company or its subsidiaries, taken as a whole, and there are no material pending or, to the Knowledge of the Company, threatened, audits (including written notice of an intent to audit), investigations, appeals, adjustments or Actions for or relating to such claims (excluding routine audits or adjustments in the ordinary course of business). All claims submitted by the Company or its subsidiaries were for goods actually sold to or services actually performed for eligible patients.

Section 3.23. Healthcare Laws. Except as set forth on Section 3.23 of the Disclosure Schedule, the Company and its subsidiaries and their respective directors, managers, officers and employees, (a) are, and since July 1, 2013, have been, in compliance in all material respects with all applicable Healthcare Laws; and (b) to the Knowledge of the Company, since July 1, 2013, have not received any notice of any alleged material violation of, or any citation for material non-compliance with any applicable Healthcare Law.

Section 3.24. Privacy and Data Security.

(a) Except as set forth on Section 3.24 of the Disclosure Schedule, each of the Company’s and each of its subsidiaries’ receipt, collection, monitoring, maintenance, creation, transmission, use, analysis, disclosure, storage, disposal and security of Personal Information, since July 1, 2013, has complied in all material respects, and complies in all material respects, with (i) any Contracts, including XXXx, to which the Company or its subsidiaries is a party, (ii) applicable Information Privacy and Security Laws, (iii) if applicable, PCI DSS, and (iv) all patient, consumer or employee consents and authorizations that apply to the Company’s and/or its subsidiaries’ receipt, access, use and disclosure of Personal Information. Each of the Company and each of its subsidiaries has all necessary authority, consents and authorizations to receive, access, use and disclose the Personal Information in the Company’s and/or each of its subsidiaries’ possession or under its control in connection with the operation of the Company and/or its subsidiaries. The Company and each of its subsidiaries has materially complied with their privacy policies that apply to any Personal Information received, created, used or disclosed by the Company or any of its subsidiaries, as applicable.

(b) Except as set forth on Section 3.24 of the Disclosure Schedule, the Company and each of its subsidiaries is a party to a BAA with the applicable third party in each instance where the Company or its subsidiaries (as the case may be) (i) acts as a Business Associate to that third party or (ii) provides protected health information (as defined in 45 C.F.R. § 160.103) to a third party service provider of the Company or its subsidiaries, in each case as required by, and in material conformity with, applicable Information Privacy and Security Laws and the applicable Contracts to which the Company or its subsidiaries is a party.

(c) Employees of the Company and each of its subsidiaries who have access to Personal Information have received documented training (in accordance with commercially reasonable standards) with respect to (i) compliance with all applicable Information Privacy and Security Laws, to the extent training is required by such laws and (ii) to the extent applicable, the PCI DSS.

(d) Since July 1, 2013, the Company and each of its subsidiaries has adopted written policies and procedures that apply to the Company and/or each of its subsidiaries with respect to privacy, data protection, security, and the collection, disclosure and use of protected health information (as defined in 45 C.F.R. § 160.103) gathered or accessed in the course of the operations of the Company and its subsidiaries, and those policies and procedures are reasonable and comply with HIPAA.

(e) Except as set forth in Section 3.24 of the Disclosure Schedule, the Company and each of its subsidiaries has commercially reasonable safeguards in place to protect the confidentiality, integrity and security of its Personal Information and IT Assets against any unauthorized control, use, access, interruption, modification or corruption in material conformance with Information Privacy and Security Laws.

(f) Except as set forth in Section 3.24 of the Disclosure Schedule, since July 1, 2013, there has been no data security breach of any IT Asset, or unauthorized access, use, acquisition or disclosure of any Personal Information, owned, used, stored, received, or controlled by or on behalf of the Company or any its subsidiaries, including any unauthorized access, use or disclosure of Personal Information that would constitute a breach for which notification to individuals and/or Governmental Authorities is required under any applicable Information Privacy and Security Laws or Contracts to which the Company or its subsidiaries is a party.

(g) Since July 1, 2013, the Company and each of its subsidiaries has identified and investigated each Security Incident (as defined in 45 C.F.R. § 164.304) to identify successful Security Incidents. For each successful Security Incident, the Company and each of its subsidiaries has identified, documented, investigated, responded to, and mitigated (to the extent practicable) each such Security Incident related to Personal Information or other confidential data of the Company and each of its subsidiaries or a customer of the Company or its subsidiaries transmitted, processed, maintained, stored or otherwise available on or through the Company’s or its subsidiaries’ IT Assets and taken all other actions with respect to those Security Incidents as required by the Information Privacy and Security Laws.

(h) Except as set forth on Section 3.24 of the Disclosure Schedule, as of the date hereof there are no Orders or Actions pending or, to the Knowledge of the Company or any of its subsidiaries, threatened against the Company or any of its subsidiaries or its “workforce” (as defined under HIPAA) by any person or by or before any Governmental Authority for: (i) a violation of any Information Privacy and Security Laws; (ii) any alleged “breach” (as defined in 45 C.F.R. § 164.402); and/or (iii) the Company’s or any if its subsidiaries’ processing of Personal Information.

(i) The (execution, delivery and performance of this Agreement and the other agreements and instruments contemplated hereby and the consummation of the transactions contemplated hereby and thereby complies in all material respects with the Company’s and each of its subsidiaries’ applicable privacy notices and policies and with all applicable Information Privacy and Data Security Laws.

(j) Except as set forth on Section 3.24 of the Disclosure Schedule, the Company and each of its subsidiaries has performed a security risk assessment that meets (i) the standards set

forth at 45 C.F.R. § 164.308(a)(1)(ii)(A), including an assessment as described at 45 C.F.R. § 164.306(d)(3), taking into account factors set forth in 45 C.F.R. § 164.306(a)–(c) and (ii) any requirements to perform security assessments under any Information Privacy and Security Law (collectively, the “Security Risk Assessment”). The Company has made available to Parent and Merger Sub true and complete copies of (i) the most recent Security Risk Assessment conducted by the Company and its subsidiaries and (ii) all written mitigation plans of the Company and its subsidiaries associated with such Security Risk Assessment. Except as set forth on Section 3.24 of the Disclosure Schedule, the Company and each of its subsidiaries has addressed and fully resolved or mitigated (in accordance with HIPAA and applicable industry standards (excluding PCI DSS)) all material, critical or high risk threats and deficiencies identified in every Security Risk Assessment and has developed and implemented plans to address other identified threats and deficiencies.

Section 3.25. Information in the Information Statement and Proxy Statement. The Information Statement or, if applicable, the Proxy Statement (and any amendments thereof or supplements thereto), at the date mailed or otherwise provided to the Company’s stockholders, shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading, except that no representation or warranty is made by the Company with respect to statements made therein based on information supplied by Parent or Merger Sub for inclusion in the Information Statement or Proxy Statement. The Information Statement or Proxy Statement shall comply as to form in all material respects with the provisions of the Exchange Act and the rules and regulations thereunder.

Section 3.26. Takeover Statutes. Assuming the accuracy of the representations in Section 4.09, the Company has taken all such actions as are necessary such that the restrictions on “business combinations” between the Company and an “interested stockholder” (as such terms are defined in Section 203 of the DGCL (“Section 203”)) set forth in Section 203 do not apply to this Agreement, the Merger, or the other transactions contemplated hereby. No Takeover Statute applies to this Agreement, the Merger, or the other transactions contemplated hereby.

Section 3.27. Opinion of Financial Advisor. The Special Committee has received (and the Company Board has relied on) the written opinion of Xxxxxxxxx LLC (the “Financial Advisor”) to the effect that, as of the date of the opinion and subject to the factors and assumptions set forth in such opinion, the Merger Consideration to be received by the holders of Company Common Stock (other than Parent and its affiliates) pursuant to this Agreement is fair, from a financial point of view, to such holders. A complete copy of the written opinion will be made available to Parent solely for informational purposes as soon as practicable after the date of this Agreement.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB

Parent and Merger Sub, jointly and severally, represent and warrant to the Company as set forth in this ARTICLE IV.

Section 4.01. Organization. Each of Parent and Merger Sub is duly organized, validly existing and in good standing (or, as applicable, the equivalent thereof) under the Laws of the jurisdiction of its organization and has the requisite power and authority necessary to own, lease and operate its properties and assets and to carry on its business as it is now being conducted, except where the failure to have such power and authority would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect. Parent has made available to the Company complete and correct copies of the certificate of incorporation and the bylaws (or similar organizational documents) of Merger Sub, as amended, modified or restated and currently in effect. Said certificate of incorporation and bylaws (or similar organizational documents) are in full force and effect and no other organizational documents are applicable to or binding upon Merger Sub.

Section 4.02. Authority. Each of Parent and Merger Sub has all necessary corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby. The execution, delivery and performance of this Agreement by each of Parent and Merger Sub and the consummation by each of Parent and Merger Sub of the transactions contemplated hereby have been duly and validly authorized by all necessary corporate action on the part of Parent and Merger Sub and shall be adopted by the sole stockholder of Merger Sub pursuant to Section 6.09 and no other corporate proceedings on the part of each of Parent and Merger Sub are necessary to authorize such execution and delivery of this Agreement or consummation of the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by each of Parent and Merger Sub and, assuming the due authorization, execution and delivery hereof by the Company, constitutes a legal, valid and binding obligation of each of Parent and Merger Sub enforceable against them each in accordance with their terms, except as may be affected by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar Laws relating to or affecting creditors’ rights generally, general equitable principles (whether considered in a proceeding in equity or at law).

Section 4.03. No Conflict; Required Filings and Consents.

(a) The execution, delivery and performance of this Agreement by each of Parent and Merger Sub and the consummation of the transactions contemplated hereby do not and will not: (i) conflict with or violate the certificate of incorporation or the bylaws (or, as applicable, the equivalent thereof) of either Parent or Merger Sub; (ii) materially conflict with or materially violate any Laws applicable to either Parent or Merger Sub or by which it or its properties are bound (assuming that all consents, approvals and authorizations contemplated by clauses (i) through (iv) of subsection (b) below have been obtained and all filings described in such clauses have been made); or (iii) result in any material breach or material violation of, constitute a material default, require consent or result in the loss of a material benefit under, give rise to a right to permit or require the purchase or sale of assets or securities under, give rise to any right

of termination, amendment, acceleration or cancellation of, or result in the creation of a Lien on any of the properties or assets of either Parent or Merger Sub (in each case, with or without notice or lapse of time or both) pursuant to, any Contract to which either Parent or Merger Sub is a party or by which either Parent or Merger Sub or their properties are bound.

(b) The execution, delivery and performance of this Agreement by each of Parent and Merger Sub and the consummation of the transactions contemplated hereby by each of Parent and Merger Sub do not and will not require any Approvals from, action by, filing with or notification to, any Governmental Authority, except for (i) compliance with the applicable requirements of the Exchange Act or state securities, takeover and “blue sky laws,” (ii) filings and recordings as may be required under the DGCL in connection with the Merger, including the filing and recordation of the Certificate of Merger, (iii) filings, permits, authorizations, consents and approvals as may be required under the HSR Act, and (iv) such other Approvals, actions, filings or notifications of a type not referenced above the failure of which to be made or obtained would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.

Section 4.04. Brokers. The Company will not be responsible for any brokerage, finder’s or other fee or commission to any broker, finder or investment banker in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of any of Parent, Merger Sub or their affiliates.

Section 4.05. Sufficient Funds. Parent and Merger Sub have full access to, and will have at the Closing, sufficient funds to make all payments contemplated by this Agreement in connection with the Merger, including (a) the payment of all amounts payable pursuant to ARTICLE II and (b) all fees and expenses required to be paid by Parent or Merger Sub in connection with the Merger.

Section 4.06. Capitalization and Operation of Merger Sub. The authorized capital stock of Merger Sub consists of 1,000 shares of common stock, par value $0.01 per share, all of which are validly issued and outstanding. All of the issued and outstanding capital stock of Merger Sub is, and at the Effective Time will be, owned by Parent. Other than as contemplated by this Agreement, Merger Sub has outstanding no option, warrant, right or any other agreement pursuant to which any person other than Parent may, directly or indirectly, acquire any equity security of Merger Sub. Merger Sub has been formed solely for the purpose of engaging in the transactions contemplated by this Agreement; except for its formation, has not engaged in any other business activities or incurred any liabilities or obligations prior to the date of this Agreement, and prior to the Effective Time, will have conducted its operations only as contemplated hereby and will have incurred no liabilities or obligations other than as contemplated hereby.

Section 4.07. No Vote of Parent Stockholders; Required Approval. No vote or consent of the holders of any class or series of capital stock of Parent or the holders of any other securities of Parent (equity or otherwise) is necessary to adopt this Agreement or to approve the Merger or the other transactions contemplated hereby. The vote or consent of Parent as the sole stockholder of Merger Sub is the only vote or consent of the holders of any class or series of capital stock of Merger Sub necessary to approve the Merger and adopt this Agreement, which consent shall be given immediately following the execution and delivery of this Agreement.

Section 4.08. Absence of Litigation. There are no material Actions pending or, to the Knowledge of Parent, threatened against Parent or Merger Sub. Neither Parent nor Merger Sub is subject to any material Order.

Section 4.09. Ownership of Shares. As of the date hereof, none of Parent, Merger Sub or any of their respective “affiliates” or “associates” “owns” (as such terms are defined in Section 203) any shares of Company Common Stock. Each of Parent and Merger Sub is not, and at no time since July 1, 2013, has been, an “interested stockholder” of the Company as defined in Section 203.

Section 4.10. Information in the Information Statement and Proxy Statement. The information supplied by Parent or Merger Sub in writing expressly for inclusion or incorporation by reference in the Information Statement or, if applicable, the Proxy Statement (or any amendments thereof or supplements thereto) will not, at the date mailed to the Company’s stockholders, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they are made, not misleading, except that no representation or warranty is made by Parent and Merger Sub with respect to statements made therein based on information supplied by the Company for inclusion in the Information Statement or Proxy Statement.

ARTICLE V

CONDUCT OF BUSINESS PENDING THE MERGER

Section 5.01. Conduct of Business by the Company Pending the Merger. During the period from and after the date of this Agreement to the earlier of the Effective Time or the termination of this Agreement pursuant to Section 8.01, unless (a) otherwise required, contemplated or permitted by this Agreement, (b) set forth on Section 5.01 of the Disclosure Schedule, (c) required by applicable Law or Nasdaq rule or (d) Parent gives its written consent, which consent shall not be unreasonably withheld, conditioned or delayed, the Company shall, and shall cause its subsidiaries to conduct the Company’s business in all material respects in the ordinary course consistent with past practice, and use commercially reasonable efforts to (i) preserve in all material respects its present relationships with each of its customers, suppliers, and other persons with whom the Company has material business relations, (ii) maintain satisfactory relationships with and keep available the services of the Company’s current officers and other Key Employees, and (iii) preserve in all material respects its present relationships with Governmental Authorities and maintain in effect all material Healthcare Permits that are required for the Company or its subsidiaries to carry on their respective businesses as currently conducted. During the period from the date of this Agreement to the earlier of the Effective Time or the termination of this Agreement pursuant to Section 8.01, the Company shall not, and shall not permit any of its subsidiaries to, unless (A) otherwise required, contemplated or permitted by this Agreement (including to the extent required to comply with the Company’s obligations in the immediately preceding sentence), (B) forth on Section 5.01 of the Disclosure Schedule, (C) required by applicable Law or Nasdaq rule or (D) Parent gives its written consent, which consent shall not be unreasonably withheld, conditioned or delayed:

(a) amend the Company Organizational Documents;

(b) issue, deliver, grant, sell, lease, sell and leaseback, pledge, license, transfer, mortgage, encumber, dispose of or otherwise subject to any Lien (other than any Permitted Lien) (i) any Company Securities or Subsidiary Securities (except for the issuance or transfer and delivery of shares of Company Common Stock issuable or transferable in accordance with the terms of the Company Options or shares of Company Restricted Stock or upon conversion of the Company Convertible Notes, in each case outstanding as of the date of this Agreement, which were granted under the Equity Compensation Plan, to the extent accounted for under the Equity Compensation Plan), or (ii) any material property or assets, whether tangible or intangible, of the Company or any of its subsidiaries, in each case, other than (A) in the ordinary course of business and in a manner consistent with past practice, (B) pursuant to Contracts in existence on the date of this Agreement or (C) dispositions of equipment and property no longer used in the operation of the business;

(c) declare, set aside, make or pay any dividend or other distribution, payable in cash, stock or other equity interests, property or otherwise, with respect to any of the Company’s or its subsidiaries’ capital stock (except dividends or other distributions paid by any direct or indirect subsidiary to the Company or to any direct or indirect wholly-owned subsidiary of the Company);

(d) reclassify, adjust, combine, split, subdivide or redeem, purchase or otherwise acquire, any Company Securities or Subsidiary Securities, except for purchases of Company Securities or Subsidiary Securities pursuant to any Company Plan and the agreements underlying awards of Company Securities or Subsidiary Securities pursuant to such Company Plans;

(e) incur, assume, redeem, repurchase, prepay, defease, cancel or otherwise acquire, or modify the terms of, any Indebtedness or authorize, issue, deliver, grant or sell any notes, bonds, debentures or other securities in respect of Indebtedness or assume, guarantee or endorse, or otherwise as an accommodation become responsible for, the Indebtedness of any other person, except for (i) borrowings under the Company’s current credit facilities in the ordinary course of business consistent with past practice, (ii) Indebtedness of up to $100,000 in the aggregate with respect to capitalized lease obligations, and (iii) Indebtedness solely between or among the Company and any of its subsidiaries;

(f) make any loans, advance or capital contributions to, or investments in, any other person (other than a subsidiary of the Company);

(g) (i) enter into, amend or modify in any material respect, terminate, cancel or renew any Material Contract or Contract that, if in effect on the date hereof would have been a Material Contract, other than in the ordinary course of business consistent with past practice, or (ii) assign or waive any material term or rights, claims, benefits or default under, or release, settle or compromise any material claim against the Company or material liabilities or obligation owing to the Company under, any Material Contract, other than in the ordinary course consistent with past practice;

(h) acquire (whether by merger, consolidation or acquisition of stock or assets or otherwise) in one transaction or any series of related transactions, except in the ordinary course of business in a manner consistent with past practice or in respect of capital expenditures as contemplated by the budget set forth on Section 5.01(i) of the Disclosure Schedule, (i) any assets or (ii) any equity interests in any person or any business or division of any person or all or substantially all of the assets of any person (or business or division thereof), in the case of the foregoing clauses (i) and (ii), except to the extent (A) otherwise obligated pursuant to any agreement as of the date hereof, a copy of which has previously been made available to Parent, or (B) solely among or between the Company and its wholly-owned subsidiaries;

(i) authorize, incur or make any capital expenditures that exceed the aggregate amount of expenditures budgeted in the Company’s current capital expenditure plan set forth on Section 5.01(i) of the Disclosure Schedule;

(j) except to the extent required under applicable Law, this Agreement or existing Company Plans as in effect on the date of this Agreement, (i) increase in any respect, or accelerate the payment of, the compensation, bonus, bonus opportunity or fringe benefits of any Company Employee except in the ordinary course of business in a manner consistent with past practice, (ii) make or grant, or accelerate the payment of, any retention, severance or termination pay not currently required to be paid under existing Company Plans to, or enter into, or amend, any employment, consulting or severance Contract with, any present or former Company Employee; (iii) enter into, adopt, amend or terminate any Company Plan; or (iv) enter into any employment, consulting, change of control or severance Contract with any newly hired employee or consultant;

(k) implement, adopt or make any change to the accounting methods used by it materially affecting its assets, liabilities or business, except for such changes that are required by GAAP or Regulation S-X promulgated under the Exchange Act or as otherwise specifically disclosed in the Company Reports, each as concurred with by the Company’s independent registered public accountants;

(l) (i) make, change or rescind any Tax election or Tax accounting method, except as required by applicable Law; (ii) fail to file material Tax Returns and other documents required to be filed with any Governmental Authority, subject to timely extensions permitted by applicable Law; (iii) extend the statute of limitations with respect to any Tax; (iv) file any amended Tax Return reflecting a material amount of income Taxes; or (v) settle or compromise any material federal, state, local or foreign Tax liability;

(m) waive, release, assign, settle or compromise any pending or threatened Action that is material, that relates to the transactions contemplated hereby or that is brought by any current, former or purported holder of any securities of the Company or its subsidiaries in such capacity;

(n) amend or modify the Company’s engagement letter with the Financial Advisor in a manner that increases the fee or commission payable by the Company;

(o) adopt a plan or agreement of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its subsidiaries (other than the Merger);

(p) announce, implement or effect any material reduction in labor force, lay-off, early retirement program, group severance program or other program or effort concerning the termination of employment of Company Employees other than routine employee terminations;

(q) revalue in any material respect any of its material assets, including writing down the value of inventory or writing down notes or accounts receivable, other than (i) in the ordinary course of business consistent with past practice, (ii) as required by GAAP or Regulation S-X promulgated under the Exchange Act, (iii) or as otherwise specifically disclosed in the Company Reports;

(r) fail to maintain in full force and effect (i) insurance policies covering the Company and its subsidiaries and their respective properties, assets and businesses and (ii) insurance policies covering all managed entities for which the Company is required to obtain and maintain insurance, in a form and amount consistent with prudent industry practice; or

(s) take, agree, resolve or commit to take any of the actions described in Section 5.01(a) through Section 5.01(r).

Notwithstanding any of the foregoing, nothing in this Section 5.01 shall be construed to prohibit the Company or any of its subsidiaries from engaging in any act which the Company or its applicable subsidiary reasonably believes is necessary for patient safety needs or to comply with the requirements of any Governmental Authority.

Section 5.02. No Control of Operations. Nothing contained in this Agreement is intended to give Parent or Merger Sub, directly or indirectly, the right to control or direct the Company’s or any of its subsidiaries’ operations prior to the Effective Time. Prior to the Effective Time, the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its subsidiaries’ respective operations.

Section 5.03. Notification of Certain Matters.

(a) The Company shall give prompt notice to Parent and Merger Sub of (i) the occurrence or non-occurrence of any event whose occurrence or non-occurrence, as the case may be, would be expected to cause any representation or warranty of the Company contained in ARTICLE III of this Agreement to be untrue or inaccurate in any material respect at any time from the date hereof to the Effective Time, only to the extent that such breach would reasonably be expected to result in any of the conditions to the obligations of Parent and Merger Sub to consummate the Merger set forth in Section 7.02(a) or Section 7.02(b) to fail to be satisfied at the Closing, and (ii) any material failure of the Company or any officer, director, employee or agent thereof, to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it hereunder that would reasonably be expected to result in any condition to the obligations of any party to effect the Merger and the other transactions not to be satisfied at the Closing; and

(b) Parent and Merger Sub shall give prompt notice to the Company of (i) the occurrence or non-occurrence of any event whose occurrence or non-occurrence, as the case may be, would be expected to cause any representation or warranty of Parent or Merger Sub contained in ARTICLE IV of this Agreement to be untrue or inaccurate in any material respect at any time from the date hereof to the Effective Time, only to the extent that such breach would reasonably be expected to result in any of the conditions to the obligations of the Company to consummate the Merger set forth in Section 7.03(a) or Section 7.03(b) to fail to be satisfied at the Closing, and (ii) any material failure of the Parent, Merger Sub or any officer, director, employee or agent thereof, to comply with or satisfy any covenant, condition or agreement to be complied with or satisfied by it hereunder that would reasonably be expected to result in any condition to the obligations of any party to effect the Merger and the other transactions not to be satisfied at the Closing;

provided, however, in the case of the foregoing clauses (a) and (b), that such notice shall not be deemed to (i) modify or cure any breach of any representations or warranties contained in this Agreement, (ii) supplement or update the Disclosure Schedule, or (iii) have any effect for the purpose of determining satisfaction of the conditions set forth in ARTICLE VII.

Section 5.04. Takeover Statutes. If any Takeover Statute is or may be come applicable to the transactions contemplated hereby after the date of this Agreement, Parent and the Company shall each use its respective commercially reasonable efforts to grant such approvals and take such actions as are reasonably necessary so that the transactions contemplated hereby may be consummated as promptly as practicable on the terms contemplated by this Agreement and otherwise act to eliminate or minimize, to the extent possible, the effects of such Takeover Statute on the transactions contemplated hereby.

ARTICLE VI

ADDITIONAL AGREEMENTS

Section 6.01. Company Stockholder Approval; Preparation of the Information Statement; Proxy Statement.

(a) Subject to and in accordance with the Company Organizational Documents and applicable Laws, including Section 228 and Section 251(c) of the DGCL, immediately following the execution and delivery of this Agreement by the parties hereto, the Company shall seek to obtain as promptly as practicable, and in any event, on or before 5:00 p.m., Dallas, Texas time, on the day immediately following the date of this Agreement (the “Stockholder Approval Deadline”), an irrevocable written consent from Ventures in substantially the form attached to this Agreement as Exhibit C in order to satisfy the Common Stockholder Approval in lieu of a meeting pursuant to Section 228 of the DGCL (such written consent, as duly executed and delivered by Ventures, the “Ventures Consent”) for the purpose of adopting this Agreement. Promptly following the receipt by the Company of the Ventures Consent, if delivered to the Company from Ventures, the Company shall deliver to Parent a copy of the executed Ventures Consent (including by facsimile or other electronic image scan transmission).

(b) If the Ventures Consent is obtained and delivered to Parent before the Stockholder Approval Deadline, as soon as reasonably practicable, and in any event within ten (10) days,

thereafter, the Company shall, with the assistance of Parent, giving good faith consideration to Parent’s comments, prepare and file with the SEC an information statement in preliminary form of the type contemplated by Rule 14c-2 promulgated under the Exchange Act related to the Merger and this Agreement (including therein a notice of appraisal rights in accordance with Section 262(d) of the DGCL and the notices of action by written consent required by Section 228(e) of the DGCL) (collectively, as amended or supplemented, the “Information Statement”). Notwithstanding the foregoing, if, and only if, an Alternative Approval Determination is made, as soon as reasonably practicable thereafter, the Company shall, with the assistance of Parent, giving good faith consideration to Parent’s comments, and in lieu of the Information Statement, prepare and file with the SEC preliminary proxy materials constituting the Proxy Statement and shall take, in accordance with the Company Organizational Documents and applicable Laws, all reasonable actions necessary to seek the Common Stockholder Approval, as mutually agreed by the Company and Parent, by either: (1) soliciting the written consent of the Company’s stockholders by proxy (the “Company Stockholders Consent”) or (2) soliciting the vote of the Company’s stockholder at a meeting of the Company’s stockholders (the “Company Stockholders Meeting”). Unless the Company Board has made a Change in Board Recommendation in accordance with Section 6.03, the Company shall include the Company Board Recommendation in any Proxy Statement filed by the Company in accordance herewith.

(c) The Company shall use commercially reasonable efforts to have the Information Statement or Proxy Statement, as applicable, cleared by the SEC as promptly as practicable and shall thereafter file with the SEC and mail to the Company stockholders as promptly as practicable the definitive Information Statement or Proxy Statement, as applicable, and all other materials required for obtaining either the Company Stockholders Consent or holding the Company Stockholders Meeting. The Company shall (i) use its commercially reasonable efforts to respond as promptly as reasonably practicable to any comments received from the SEC or any required amendments with respect to the preliminary Information Statement or Proxy Statement, as applicable, and resolve such comments with the SEC, and (ii) as promptly as reasonably practicable after the date on which the Company files the definitive Information Statement or Proxy Statement, as applicable, in compliance with the Exchange Act, cause such filing to be mailed to the stockholders of the Company. Each of Parent, Merger Sub and the Company shall furnish all information concerning itself and the transactions contemplated by this Agreement as may be reasonably requested by the SEC in connection with the preparation, filing and distribution of an Information Statement or a Proxy Statement, as applicable. The Company shall notify Parent and Merger Sub promptly upon the receipt of any comments from the SEC or its staff and of any request by the SEC or its staff for amendments or supplements to the Information Statement or Proxy Statement, as applicable, or for additional information and shall consult with Parent and Merger Sub regarding, and supply Parent and Merger Sub with copies of, all correspondence between the Company and its officers, directors, employees, accountants, consultants, auditors, counsel, financial advisors and other agents and representatives (collectively, “Representatives”), on the one hand, and the SEC and its staff, on the other hand, with respect to the Information Statement or Proxy Statement, as applicable. Prior to filing or mailing any proposed amendment of or supplement to the Information Statement or Proxy Statement, as applicable, or responding to any comments of the SEC with respect thereto, the Company shall (x) provide Parent a reasonable opportunity to review and comment on such document or response and (y) give reasonable consideration to all additions, deletions or changes

suggested thereto by Parent and its legal counsel. If at any time prior to obtaining the Company Stockholders Consent or the Company Stockholders Meeting any information relating to the Company or Parent, or any of their respective affiliates, is discovered by the Company or Parent that should be set forth in an amendment or supplement to the Information Statement or Proxy Statement, as applicable, so that such filing shall not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading, or as otherwise required by applicable Law or any applicable rules or regulations of Nasdaq, the party that discovers such information shall promptly notify the other parties, and an appropriate amendment or supplement describing such information promptly shall be filed with the SEC and, to the extent required by Law, disseminated to the stockholders of the Company, in each case as and to the extent required by applicable Law or any applicable rules or regulations of Nasdaq.

(d) If an Alternative Approval Determination is made, the Company shall seek the Company Stockholders Consent unless the Company and Parent mutually determine, in good faith, that seeking the Company Stockholders Consent may be reasonably expected to be adverse to the Company or otherwise delay the consummation of the transactions contemplated by this Agreement, in which case the Company shall hold a Company Stockholders Meeting in accordance herewith. If there is an Alternative Approval Determination and the parties have determined (and such determination is made in accordance with the immediately preceding sentence) to hold a Company Stockholders Meeting, the Company, acting through the Company Board, shall promptly and duly call, give notice of, convene and hold as soon as reasonably practicable following confirmation by the SEC that the SEC has no further comments to the Proxy Statement a Company Stockholders Meeting, and shall use its commercially reasonable efforts to solicit and obtain the Common Stockholder Approval at such Company Stockholders Meeting. Subject to termination of this Agreement pursuant to Section 8.01, if there is an Alternative Approval Determination and the parties have determined (and such determination is made in accordance with the first sentence of this Section 6.01(d)) to seek the Company Stockholders Consent and such Company Stockholders Consent is not obtained, the Company shall be required to hold the Company Stockholders Meeting and comply with its other obligations under this Agreement regardless of whether the Company Board has effected a Change in Board Recommendation (as defined in Section 6.03(c)) in accordance with Section 6.03(c). Notwithstanding any provision of this Agreement to the contrary, the Company may, after consultation with Parent, determine to adjourn, recess or postpone the Company Stockholders Meeting (i) to the extent required by Law or fiduciary duty, (ii) to the extent necessary to ensure that any required supplement or amendment to the Proxy Statement is provided to the stockholders of the Company within a reasonable amount of time in advance of the Company Stockholders Meeting, (iii) if, as of the time for which the Company Stockholders Meeting is originally scheduled (as set forth in the Proxy Statement), there are insufficient shares of Company Common Stock represented (either in person or by proxy) to constitute a quorum necessary to conduct the business of the Company Stockholders Meeting, solely for the purpose of obtaining, and for the time reasonably necessary to obtain, such a quorum, or (iv) if, as of the time for which the Company Stockholders Meeting is originally scheduled (as set forth in the Proxy Statement), sufficient votes to constitute the Common Stockholder Approval have not been obtained, solely for the purpose of soliciting, and for the time reasonably necessary to solicit, additional proxies and votes to obtain Common Stockholder Approval.

(e) All documents that the Company, Parent or Merger Sub are responsible for filing with the SEC in connection with the transactions contemplated hereby shall comply in all material respects with the requirements of applicable Law, including the Exchange Act.

Section 6.02. Access to Information; Confidentiality of Information.

(a) From the date of this Agreement to the earlier of the Effective Time or the termination of this Agreement pursuant to Section 8.01, the Company shall, and shall cause its subsidiaries and its and their respective Representatives to afford Parent and Merger Sub and their Representatives, upon reasonable prior notice, reasonable access during normal business hours to the Representatives, properties, offices and other facilities and to the books and records of the Company and its subsidiaries and the Company shall furnish as promptly as reasonably practicable to Parent (i) a copy of each report, schedule, registration statement and other document submitted or filed by the Company during such period with any Governmental Authority as Parent may reasonably request and (ii) all information concerning its business and properties as Parent may reasonably request, subject to compliance with applicable Law and other than any such information that relates to the negotiation and execution of this Agreement or any Acquisition Proposals (it being understood that information relating to any Acquisition Proposal shall be governed by Section 6.03). The foregoing notwithstanding, the Company shall not be required to afford such access if such access would reasonably be likely to (i) unreasonably disrupt or interfere with the business or operations of the Company or any of its subsidiaries, (ii) violate the terms of the Clean Room Agreement or any other Contract to which the Company or any of its subsidiaries is a party (provided that, in the case of the other Contracts, the Company shall use commercially reasonable efforts to obtain consent of the counterparties to provide access to such other Contracts), (iii) cause a risk of loss of attorney/client privilege or trade secret protection to the Company or any of its subsidiaries (provided that the Company shall use its commercially reasonable efforts to develop an alternative to providing such information reasonably acceptable to Parent), (iv) disclose any confidential competitive information of the Company or any of its subsidiaries or affiliates (except pursuant to, and in accordance with, the terms of the Clean Room Agreement), or (v) result in a violation of any applicable Law.

(b) Subject to prior consultation with the Company and applicable Antitrust Law, the Company shall provide Parent and its Representatives reasonable access during normal business hours upon prior notice, from the date of this Agreement to the earlier of the Effective Time or the termination of this Agreement pursuant to Section 8.01, to the executive officers of the Company and its subsidiaries and to information reasonably required for the purpose of transition planning and to enable Parent to make presentations to, and discuss with, certain employees of the Company and its subsidiaries, as reasonably determined and agreed to by the Company and Parent, Parent’s plans and strategies for post-Closing operations subject to necessary antitrust safeguards. The Company shall have the right to have a Representative present at all meetings between Parent and its Representatives and any employees of the Company and its subsidiaries. Any such meetings shall be conducted in such a manner as not to interfere unreasonably with the business or operations of the Company or its subsidiaries or otherwise unreasonably interfere with the prompt and timely discharge by such employees of the Company and its subsidiaries of their normal duties. Parent shall not provide any written information or written materials to any employees of the Company and its subsidiaries at any such meetings or otherwise without the prior written consent of the Company.

(c) The Company shall, if practicable, provide Parent (i) its financial results for any period after the date of this Agreement prior to making any such financial results publicly available and (ii) any report or document (other than reports under Section 16 of the Exchange Act) to be filed with the SEC after the date of this Agreement prior to any such filing, it being understood that, in either case, Parent shall have no liability solely by reason of being provided with any such documents. Parent shall maintain the confidentiality of all such information until such information is otherwise made public by the Company.

(d) Parent and Merger Sub shall hold any nonpublic information, including all information provided pursuant to Section 6.02(a), Section 6.02(b) and Section 6.02(c), in confidence to the extent required by, and in accordance with, the provisions of that certain agreement, dated September 16, 2015, between Optum, Inc. and the Company (the “Non-Disclosure Agreement”).

Section 6.03. No Solicitation of Transactions.

(a) Subject to Section 6.03(b), Section 6.03(c), Section 6.03(d), Section 6.03(e), and Section 6.03(f), until the earlier of the Effective Time or the termination of this Agreement pursuant to Section 8.01, the Company shall (x) not, and shall not permit any of its subsidiaries, its subsidiaries’ officers or directors, the senior management-level employees or above, or the Financial Advisor to (collectively with the Company, the “Company Non-Solicit Parties”), and (y) direct its and its subsidiaries’ Representatives (other than Representatives that are Company Non-Solicit Parties) (collectively, the “Other Non-Solicit Parties” and together with the Company Non-Solicit Parties, the “Non-Solicit Parties”) not to (and shall use commercially reasonable efforts in respect thereof), directly or indirectly, (i) solicit, initiate, or knowingly take any action to encourage or facilitate the making or completion of any Acquisition Proposal or the making of any proposal that would reasonably be expected to lead to the making or completion of any Acquisition Proposal, (ii) enter into, conduct, engage or otherwise participate in any discussions or negotiations regarding, or furnish to any person any non-public material information relating to the Company or any of its subsidiaries, or knowingly assist, participate in, facilitate or encourage any effort by, any third party that is seeking to make, or has made, any Acquisition Proposal, (iii) approve any transaction under, or any third party becoming an “interested stockholder” under, Section 203 of the DGCL, (iv) enter into any written or oral agreement in principle, letter of intent, term sheet, acquisition agreement, merger agreement, option agreement, joint venture agreement, partnership agreement or other Contract relating to the making or completion of any Acquisition Proposal or (v) propose publicly to do any of the foregoing related to an Acquisition Proposal. Without limiting the ability of the Non-Solicit Parties to take actions described in Section 6.03(b), the Company shall cause the Company Non-Solicit Parties, and shall direct the Other Non-Solicit Parties to immediately cease and cause to be terminated all existing discussions or negotiations with any person conducted heretofore with respect to any Acquisition Proposal. Subject to Section 6.03(b) and Section 6.03(c), the Company shall not furnish any non-public information relating to the Company, or afford access to the books and records or Representatives of the Company, to any third party that is seeking to or may make, or has made, an Acquisition Proposal, and, if requested in writing by Parent, shall

use its commercially reasonable efforts to cause any such third party (or its agents or advisors) already in possession of non-public information in respect of the Company or its subsidiaries that was furnished by or on behalf of the Company or its subsidiaries to return or destroy (and confirm destruction of) all such information; provided, that, notwithstanding the foregoing, the Company shall not be required to cease furnishing, or cause any third party to destroy, information to any third party to the extent any such information has been or is hereafter provided in connection with the Company’s or its subsidiaries’ bona fide business relationship with such third party (including if such third party is a customer, supplier or partner of the Company or any of its subsidiaries); provided, that the Company determines in good faith that any such information so provided is not reasonably expected to be used in connection with an Acquisition Proposal and, in the case of third party relationships existing prior to or as of the date hereof, such information is consistent with information historically provided to such third party and in the case of new relationships, consistent with the types of information historically provided to similar third parties. The Company shall not terminate, waive, amend, release or modify any material provision of any confidentiality or standstill agreement to which it or any of its subsidiaries is a party with respect to any Acquisition Proposal; provided, however, that nothing in this Section 6.03 shall prohibit the Company from rendering inapplicable, exempting or taking any action to render inapplicable or exempt any person from any standstill agreement or similar arrangement, or the provisions of any Takeover Statute, to permit such person to make an Acquisition Proposal and engage in negotiations with respect to such proposal, subject to the other provisions of this Section 6.03, provided, that the Company Board determines (upon recommendation of the Special Committee and after consultation with its outside legal counsel) that the failure to take such action would be inconsistent with the directors’ fiduciary duties or obligations under applicable Law.

(b) Notwithstanding anything to the contrary in Section 6.03(a), and subject to Section 6.03(c), if at any time during the Applicable Period the Company receives an Acquisition Proposal from any person that did not result from or arise in connection with a material breach of Section 6.03(a), and the Company Board determines in good faith (upon recommendation of the Special Committee and after consultation with its outside legal counsel and financial advisor of nationally recognized reputation) that such Acquisition Proposal constitutes or could reasonably be expected to result in a Superior Proposal, then the Non-Solicit Parties may (i) negotiate and enter into an Acceptable Confidentiality Agreement with such person, (ii) furnish information and data (including any non-public information) regarding, and afford access to, officers, employees, agents, properties, offices and facilities and to the books, personnel, Contracts and records of the Company and its subsidiaries to such person and its representatives pursuant to an Acceptable Confidentiality Agreement; and (iii) enter into, maintain and participate in discussions or negotiations with such person and its representatives with respect to such Acquisition Proposal or otherwise cooperate with or assist or participate in, or facilitate, any such discussions or negotiations. The parties agree that nothing in this Agreement shall prevent the Non-Solicit Parties, following receipt of an Acquisition Proposal from a person, from (x) contacting such person solely in order to request clarification of the terms and conditions of any Acquisition Proposal made by such person to the extent necessary to determine whether such Acquisition Proposal constitutes or could reasonably be expected to result in a Superior Proposal or (y) directing any persons to this Agreement.

(c) The Company Non-Solicit Parties may not (and shall direct the Other Non-Solicit Parties not to (and shall use commercially reasonable efforts in respect thereof) take the actions described in Section 6.03(b)(ii)-(iii) unless:

(i) the Company has (A) previously received from such person an executed Acceptable Confidentiality Agreement and (B) previously (or within one business day following disclosure to such other person) made available to Parent any non-public information to be provided to such person to the extent not previously provided to Parent;

(ii) the Company Board has determined in good faith, upon recommendation from the Special Committee and (A) after consultation with its outside financial and legal advisors, that such Acquisition Proposal either constitutes a Superior Proposal or is reasonably likely to result in a Superior Proposal and (B) after consultation with its legal counsel, that the failure to take such action would be reasonably likely to be inconsistent with the directors’ fiduciary duties or obligations under applicable Law; and

(iii) the Company has delivered to Parent written notice prior to taking any such action described in Section 6.03(b)(ii)-(iii) (A) stating that the Company Board intends to take such action and (B) including a copy of such Acquisition Proposal (including any materials relating to such person’s proposed equity and debt financing, if any, but excluding the identity of (and specifically identifying information regarding) such person) and an executed copy of the Acceptable Confidentiality Agreement.

(d) Except as set forth in Section 6.03(e), the Company and/or the Company Board, as applicable, shall not:

(i) (A) withhold, amend, withdraw (or modify or qualify in any material respect) the Company Board Recommendation, (B) adopt, approve or recommend to stockholders the adoption of any Acquisition Proposal, (C) publicly propose to take any such actions described in the foregoing clauses (A) and (B), or (D) following public disclosure of an Acquisition Proposal during the Applicable Period, fail to publicly confirm the Company Board Recommendation promptly, and in any event within ten (10) business days after such Acquisition Proposal has been publicly disclosed, and within five (5) business days after Parent so requests in writing thereafter (it being understood that the Company will have no obligation to make such reaffirmation on more than two (2) separate occasions) (each such action set forth in this Section 6.03(d)(i) being referred to herein as a “Change in Board Recommendation”); or

(ii) enter into, or permit the Company to enter into, any letter of intent, memorandum of understanding, agreement in principle, acquisition agreement, merger agreement, option agreement, joint venture agreement, partnership agreement or other agreement constituting or directly related to, or which is intended to or is reasonably likely to lead to, any Acquisition Proposal (other than any Acceptable Confidentiality Agreements entered into in accordance with Section 6.03(b)(i)) or require the Company to abandon, terminate or fail to consummate the Merger and other transactions contemplated by this Agreement.

(e) Notwithstanding anything to the contrary in this Agreement, at any time during the Applicable Period (and, for the avoidance of doubt, only during such period), the Company Board may make a Change in Board Recommendation if and only if (x) the Company Board determines that, subject to complying with Section 6.03(e)(i) – Section 6.03(e)(iii), an Acquisition Proposal constitutes a Superior Proposal or (y) subject to complying with Section 6.03(e)(i) – Section 6.03(e)(iii), an Intervening Event has occurred and is continuing, solely to the extent that with respect to the prior clauses (x) or (y), the Company Board has determined (upon recommendation of the Special Committee and after consultation with its outside legal counsel) that the failure to do so would be inconsistent with the directors’ fiduciary duties or obligations under applicable Law. The Company Board may not make a Change in Board Recommendation as described in Section 6.03(d) unless:

(i) the Company has (1) given Parent at least six (6) business days’ prior written notice of its intention to make a Change in Board Recommendation, which written notice shall state that the Company Board has determined the existence of a Superior Proposal or an Intervening Event, and shall provide, as applicable, (x) the identity of the person making such Superior Proposal (including the identity of such person’s proposed equity financing sources), a description of the material terms of such Superior Proposal, and unredacted (other than with respect to any financing fees) copies of the proposed agreements and equity financing commitments, and any amendments or modifications thereto, or (y) a summary describing, in all material respects, the Intervening Event; and (2) during such six (6) business day period, negotiated, (and has directed the Other Non-Solicit Parties to negotiate (and shall use commercially reasonable efforts in respect thereof)), in good faith with Parent and its affiliates and their respective representatives (to the extent Parent desires to negotiate) regarding an amendment of this Agreement so that the Company Board would no longer be permitted to make a Change in Board Recommendation;

(ii) during such six (6) business day period, either (1) Parent shall not have proposed written revisions, binding on Parent upon acceptance by the Company, to the terms and conditions of this Agreement or (2) if Parent shall have proposed written revisions, binding on Parent upon acceptance by the Company, to the terms and conditions of this Agreement, the Company Board shall have determined (upon recommendation of the Special Committee and after consultation with its outside legal counsel and financial advisor of nationally recognized reputation) that in the case of a Superior Proposal, the third party’s Acquisition Proposal remains a Superior Proposal with respect to Parent’s revised written proposal, or in the case of an Intervening Event, such Intervening Event is continuing; and

(iii) the Company shall keep Parent reasonably and promptly informed of the status and any material developments with respect to any such Acquisition Proposal or Intervening Event.

(f) Nothing contained in this Section 6.03 shall prohibit the Company from (i) complying with its disclosure obligations under U.S. federal or state securities Laws with regard to an Acquisition Proposal, including taking and disclosing to its stockholders a position contemplated by Rules 14e-2(a) or 14d-9 under the Exchange Act (or any similar communication to stockholders) or (ii) making any disclosure to the Company’s stockholders, if, in the good

faith judgment of the Company Board, after consultation with its outside legal counsel, failure to do so would be inconsistent with the Company Board’s fiduciary duties or obligations or constitute a violation of disclosure requirements under applicable Law; provided, however, that a factually accurate public statement by the Company that describes the Company’s receipt of an Acquisition Proposal and the operation of this Agreement with respect thereto (and no other material communication other than as contemplated by the foregoing as to receipt and operation), or any disclosure that constitutes a “stop, look and listen” communication of the type contemplated by Section 14d-9(f) under the Exchange Act (and no other material communication other than as contemplated by Section 14d-9(f)) or similar communication to the stockholders of the Company, shall not constitute a Change in Board Recommendation (including for purposes of Section 6.03(e)(ii)) or an approval or recommendation with respect to any Acquisition Proposal, and the Company considers in good faith comments from Parent with respect to such statement or disclosure (to the extent reasonably practicable based on the time required to make such statement or disclosure and other relevant circumstances).

Section 6.04. Employee Matters.

(a) Except as contemplated herein, from the Effective Time through the first anniversary of the Effective Time, Parent shall provide or cause to be provided to each Company Employee who remains in the employment of Parent or any of its subsidiaries immediately following the Effective Time (a “Continuing Employee”): (i) a base salary or wages and cash bonus opportunities (other than any retention or other special or non-recurring bonus or cash awards) that are no less favorable, in the aggregate, to those that were provided to the Continuing Employee immediately before the Effective Time; and (ii) employee benefits (other than any retention, change of control, equity-based compensation, or other special or non-recurring bonus or cash awards) that are no less favorable, in the aggregate, than those provided to the Continuing Employee immediately prior to the Effective Time.

(b) Parent shall ensure that Continuing Employees receive credit (for purposes of eligibility to participate and vesting, but not for defined benefit pension benefit accrual or participation, retiree medical, or for purposes of any equity compensation program) for service with the Company and its subsidiaries prior to the Effective Time (to the same extent such service credit was granted under the Company Plans) under the comparable employee benefit plans, programs and policies of Parent, the Surviving Corporation and any of their subsidiaries in which such employees become participants (the “Parent Employee Plans”), as if such service had been performed with Parent or any of its subsidiaries, except to the extent that such service crediting would result in duplication of benefits for the same period of service and for purposes of any nonqualified retirement plan. In addition, Parent shall ensure that: (i) each Continuing Employee shall be eligible to participate, without any waiting time, in any and all Parent Employee Plans providing group health benefits to the extent such Parent Employee Plans replace coverage under a similar or comparable Company Plan in which such Continuing Employee participated immediately before such replacement, (ii) for purposes of each Parent Employee Plan providing group health benefits to any Continuing Employee and his or her covered dependents, any pre-existing conditions or limitations, evidence of insurability, actively-at-work or similar requirements and eligibility waiting periods shall be waived with respect to such Continuing Employees and his or her covered dependents; and (iii) each Continuing Employee and his or her covered dependents shall receive full credit under Parent Employee

Plan’s for the plan year in which the Effective Time occurs towards applicable deductibles, co-insurance and annual out-of-pocket limits for expenses incurred prior to the Effective Time under the Company Plans in the Company Plan’s plan year in existence at the Effective Time; provided that the Surviving Corporation provides Parent with the information reasonably required to process such information, and Parent, as the sole stockholder of the Surviving Corporation, shall reasonably facilitate the provision of such information, to the extent available. Nothing in this Section 6.04(b) is intended to amend any employee benefit plans, obligate Parent to maintain any particular employee benefit plan or arrangement, or prevent Parent from modifying or terminating any employee benefit plans in a manner permissible under the terms thereof.

(c) Nothing contained in this Section 6.04, express or implied (i) shall be construed to establish, amend, or modify any Parent Employee Plan, program, agreement or arrangement or (ii) is intended to confer upon any person (including Continuing Employees, retirees, or dependents or beneficiaries of employees or retirees) any rights as a third-party beneficiary of this Agreement.

(d) If requested in writing by Parent at least ten (10) business days prior to the anticipated Closing Date, on or prior to Closing, the Company and its applicable subsidiaries shall adopt written resolutions of the applicable board of directors in a form reasonably satisfactory to Parent providing for the termination of each Company Plan qualified under Section 401(a) of the Code (the “Company 401(k) Plan”), to cease contributions to the Company 401(k) Plan and to one hundred percent (100%) vest all participants under the Company 401(k) Plan, such termination and vesting to be effective no later than the business day preceding the Closing Date; provided, however, that the Company 401(k) Plan termination may be made contingent upon the consummation of the transactions contemplated by this Agreement.

Section 6.05. Indemnification and Insurance.

(a) The Surviving Corporation, Parent and Merger Sub agree that all rights to exculpation, indemnification and advancement of expenses existing as of the date hereof in favor of the current or former directors, officers or employees, as the case may be, of the Company or its subsidiaries as provided in the Company Organizational Documents shall survive the Merger, be honored by the Surviving Corporation and its subsidiaries and shall continue in full force and effect. For a period of six (6) years from the Closing Date, the Company (and following the Effective Time, the Surviving Corporation) shall maintain in effect the exculpation, indemnification and advancement of expenses provisions of the respective certificates of incorporation and bylaws or similar organizational or governing documents of the Company and its subsidiaries as in effect immediately prior to the Effective Time or in any indemnification agreements of the Company or its subsidiaries with any of their respective directors, officers or employees as in effect immediately prior to the Effective Time, and shall not amend, repeal or otherwise modify any such provisions except as either required by applicable Law or to make changes permitted by applicable Law that would enhance the rights thereunder of any individuals who at the Effective Time were current or former directors, officers or employees of the Company or any of its subsidiaries to indemnification or advancement of expenses. From and after the Effective Time, Parent shall cause the Company (and following the Effective Time, the Surviving Corporation) and its subsidiaries to honor, in accordance with their respective terms, each of the covenants contained in this Section 6.05.

(b) Without limiting Section 6.05(a) or any rights of any Indemnified Party (as defined below) pursuant to any indemnification arrangement, from and after the Closing through the sixth (6^th) anniversary of the date on which the Effective Time occurs, Parent, the Company (and following the Effective Time, the Surviving Corporation) and their respective subsidiaries shall indemnify, defend and hold harmless each current and former officer or director of the Company and its subsidiaries (each, taken together with such person’s heirs, executors or administrators, an “Indemnified Party”), against all claims, losses, liabilities, damages, judgments, inquiries, fines and reasonable and documented fees, costs and expenses, including attorneys’ fees, investigation expenses and disbursements (collectively, “Costs”), incurred in connection with any threatened or actual Action directly or indirectly arising out of or pertaining to (i) the fact that an Indemnified Party is or was an officer, director, employee, fiduciary or agent of the Company or any of its subsidiaries or (ii) matters existing or occurring at or prior to the Effective Time (including any claim in connection with this Agreement and the transactions and actions contemplated hereby), whether asserted or claimed prior to, at or after the Effective Time, to the fullest extent permitted under the Company Organizational Documents and the DGCL. In the event of any such Action, each Indemnified Party shall be entitled to the prompt advancement (and Parent shall use commercially reasonable efforts to make or cause to be made such advancement within ten (10) business days following a request, but in no event shall such advancement be made later than thirty (30) days following any such request) of expenses actually and reasonably incurred in the defense of any claim, action, suit, proceeding or investigation from the Surviving Corporation to the fullest extent permitted by the Company Organizational Documents and the DGCL following request by the Indemnified Party therefor; provided that any person to whom expenses are advanced provides an undertaking, if and only to the extent required by the DGCL, to repay such advances if it is ultimately determined by final adjudication that such person is not entitled to be indemnified by the Surviving Corporation as authorized by the DGCL, (x) without limiting the foregoing, each Indemnified Party may retain the Company’s regularly engaged independent legal counsel (provided that such engagement would not create or develop into a conflict for such legal counsel under applicable rules of professional conduct) or other counsel satisfactory to such Indemnified Party, subject to the consent of the insurance carrier under the Tail Policy (if and to the extent required under the Tail Policy), and Parent and the Surviving Corporation shall pay all reasonable fees and expenses of such counsel for the Indemnified Party promptly following receipt of statements therefor; provided that, Parent shall not be required to pay the fees and expenses of more than one (1) legal counsel to represent the Indemnified Parties in connection with a specific Action or series of factually related Actions unless the engagement of one (1) legal counsel to represent all Indemnified Parties in such Action(s) would create, or reasonably be expected to develop into, a conflict under applicable Law or rules of professional conduct for such legal counsel, in which case, the foregoing limitation on Parent’s obligation to pay the fees and expense of legal counsel shall not be applicable, and (y) none of Parent or the Surviving Corporation shall settle, compromise or consent to the entry of any judgment in any threatened or actual Action (and in which indemnification could be sought by such Indemnified Party hereunder), unless such settlement, compromise or consent includes an unconditional release of such Indemnified Party from all liability arising out of such Action or such Indemnified Party otherwise consents in writing to such settlement, compromise or consent and (z) Parent and the Surviving Corporation

shall use commercially reasonable efforts to reasonably cooperate in the defense of any matter for which the Indemnified Party could seek indemnification hereunder, in each case at its own expense. With respect to any determination of whether an Indemnified Party is entitled to indemnification by the Company (and following the Effective Time, the Surviving Corporation) under this Section 6.05(b), the Indemnified Party shall have the right to require that such determination be made by special, independent legal counsel selected by the Indemnified Party, subject to the consent of the insurance carrier under the Tail Policy (if and to the extent required under the Tail Policy), and approved by the Company or Surviving Corporation, as applicable, (which approval shall not be unreasonably withheld, conditioned or delayed), and who has not otherwise performed material services for Parent, the Company or the Surviving Corporation or any of their respective Affiliates within the last three (3) years; provided that Parent shall not be required to pay the fees and expenses of more than one (1) special, independent legal counsel to determine whether more than one Indemnified Party is entitled to indemnification under this Section 6.05(b) in connection with a specific Action or series of factually related Actions unless the engagement of one (1) special, independent legal counsel to make such determination for all such Indemnified Parties would create, or reasonably be expected to develop into, a conflict under applicable Law or rules of professional conduct for such legal counsel, in which case, the foregoing limitation on Parent’s obligation to pay the fees and expense of special, independent legal counsel shall not be applicable.

(c) Prior to the Effective Time, the Company shall purchase a directors’ and officers’ liability insurance “tail” policy or “runoff” policy covering a period of six (6) years from and after the Effective Time (the “Tail Policy”) with respect to acts and omissions occurring on or prior to the Effective Time, which policy (i) must include at least the same coverage as that which currently exists for each Indemnified Party under the Company’s current directors’ and officers’ liability insurance (on terms and conditions which are not less advantageous to any beneficiary thereof) and (ii) shall be purchased from the Company’s current carrier or another carrier with a rating no lower than the A.M. Best rating of A; provided that the annual premium for the Tail Policy does not exceed 300% of the aggregate premiums paid by the Company for directors’ and officers’ liability insurance in 2015. Parent and the Surviving Corporation shall maintain the Tail Policy in full force and effect and shall honor all obligations thereunder.

(d) Notwithstanding anything herein to the contrary, if any Action (whether arising before, at or after the Effective Time) is made against any Indemnified Party on or prior to the sixth (6^th) anniversary of the Effective Time, the provisions of this Section 6.05 shall continue in full force and effect until the final disposition of such Action.

(e) Parent and the Surviving Corporation shall pay, or shall cause to be paid, all reasonable expenses, including reasonable attorneys’ fees, that may be actually incurred by any Indemnified Party in enforcing the obligations of this Section 6.05; provided that such Indemnified Party is the prevailing party in any such Action.

(f) The rights of each Indemnified Party hereunder shall be in addition to, and not in limitation of, any other rights such Indemnified Party may have under the certificates of incorporation or bylaws or other organizational or governing documents of the Company or any of its subsidiaries or the Surviving Corporation, any other indemnification arrangement, the DGCL or otherwise. Subsequent amendment, termination or repeal of the certificates of

incorporation, bylaws or other organizational or governing documents of the Company or any of its subsidiaries or of the Surviving Corporation shall not diminish or impair the rights of any Indemnified Party. The provisions of this Section 6.05 shall survive the consummation of the Merger and expressly are intended to benefit, and are enforceable by, each of the Indemnified Parties and their respective heirs and legal representatives.

(g) In the event Parent, the Surviving Corporation or any of their respective successors or assigns (i) consolidates with or merges into any other person and shall not be the continuing or surviving corporation or entity in such consolidation or merger or (ii) transfers all or substantially all of its properties and assets to any person, then, and in either such case, proper provision shall be made so that the successors and assigns of Parent or the Surviving Corporation, as the case may be, shall assume or succeed to the obligations set forth in this Section 6.05.

(h) From and after the Effective Time, Parent and the Surviving Corporation and its subsidiaries shall honor and perform in all respects to the maximum extent permitted by applicable Law, in accordance with their respective terms, each of the covenants contained in this Section 6.05.

Section 6.06. Regulatory Approvals and Other Matters.

(a) Subject to the terms and conditions set forth in this Agreement, and except with respect to filings and approvals required pursuant to Antitrust Laws, which are exclusively set forth in Section 6.06(b) – Section 6.06(c), each party shall reasonably cooperate and use its respective commercially reasonable efforts to (i) prepare promptly and file, as promptly as practicable all necessary documentation, (ii) effect all necessary applications, notices, petitions, filings and other documents, as promptly as practicable or (iii) make or obtain all necessary Approvals from any Governmental Authority and all other persons necessary or advisable to consummate the transactions contemplated hereby. Parent and the Company shall consult with each other with respect to the obtaining of all such necessary or advisable Approvals. Each of Parent and the Company shall have the right to review and approve in advance drafts of all such necessary applications, notices, petitions, filings and other documents made or prepared in connection with the transactions contemplated hereby, which approval shall not be unreasonably withheld, conditioned or delayed. Each party shall promptly notify the other party of any failure or prospective failure to make or obtain any such Approvals and shall provide, as promptly as practicable, copies of all consents obtained by it.

(b) Each of Parent and the Company shall (i) prepare and file any notification and report forms and related material required under the HSR Act, and any additional filings or notifications and related material required under any additional applicable Antitrust Laws or that are necessary, proper or advisable to permit consummation of the transactions contemplated hereby, as promptly as practicable (but in no event later than five (5) business days from the date hereof except by mutual consent confirmed in writing); (ii) provide or cause to be provided as promptly as practicable any information and documentary material that may be requested by the U.S. Department of Justice (the “DOJ”) or Federal Trade Commission (the “FTC”) under the HSR Act or by any Governmental Authority with regulatory jurisdiction over enforcement of any Antitrust Laws (each such Governmental Authority, a “Governmental Antitrust

Authority”); and (iii) use their reasonable best efforts to secure as promptly as is practicable the termination or expiration of any waiting periods under any applicable Antitrust Law, to obtain the approval of any Governmental Antitrust Authority, as applicable, for the Merger and the other transactions contemplated hereby. Parent shall pay all filing fees under the HSR Act and any other Antitrust Laws. Subject to applicable Law prohibiting or otherwise limiting the exchange of information, each of Parent and the Company shall promptly inform each other of any material communication (or other correspondence or memoranda) received from, or given to, the DOJ, the FTC, or any other Governmental Antitrust Authority. Neither Parent nor the Company shall commit to or agree with any Governmental Authority to stay, toll or extend any applicable waiting period under the HSR Act or any additional applicable Antitrust Laws, without the prior written consent of the other.

(c) Notwithstanding the foregoing or anything in this Agreement to the contrary, in no event shall Parent or any of its affiliates be required to, nor shall the Company or any of its affiliates, without prior written consent of Parent, (i) pay any sums or concede anything of value in excess of $100,000, (ii) sell or otherwise dispose of, or hold separate and agree to sell or otherwise dispose of, assets, categories of assets or businesses of the Company or Parent or their respective subsidiaries or affiliates, or otherwise take or commit to take any action that would reasonably limit Parent’s, the Company’s or any of their respective affiliates’ freedom of action with respect to, or their ability to retain, one or more businesses, product lines or assets, (iii) terminate, modify or extend any existing relationships and contractual rights and obligations of the Company or Parent or their respective subsidiaries or affiliates, (iv) establish or create any relationships and contractual rights and obligations of the Company or Parent or their respective subsidiaries or affiliates, (v) terminate any relevant venture or other arrangement, (vi) effectuate any other change or restructuring of the Company or Parent or their respective subsidiaries or affiliates (and, in each case, to enter into agreements or stipulate to the entry of an Order or file appropriate applications with the appropriate Governmental Antitrust Authority) or (vii) litigate or defend against any Action brought by a Governmental Antitrust Authority, including any Action brought by a Governmental Antitrust Authority seeking a temporary restraining order or an injunction challenging any of the transactions contemplated by this Agreement as violative of any Antitrust Laws. In addition, Parent and its affiliates shall be permitted to acquire any equity interest in, acquire all or substantially all of the assets of, merge, consolidate, enter into a share exchange or business combination with, or enter into any other similar transaction or series of transactions with, any person and the parties agree that, except as otherwise provided in this Agreement, no such transaction shall be a breach of this Agreement.

(d) If any administrative or judicial Action is instituted (or threatened to be instituted) by or before a Governmental Authority challenging the transactions contemplated hereby as violating any applicable Laws, each of the Company, Parent and Merger Sub shall, and shall cause their respective affiliates to, cooperate and use their reasonable best efforts to avoid and resolve any such Action.

Section 6.07. Public Announcements. The initial press release concerning the Merger and announcing this Agreement shall be a joint press release of the Company and Parent to be reasonably agreed upon by Parent and Company, and, thereafter, neither the Company, Parent nor Merger Sub shall, or permit their Representatives to, issue or cause the publication of any press release or other public announcement (to the extent not previously issued or made in

accordance with this Agreement) with respect to this Agreement or any transaction contemplated hereby, except to the extent required by applicable Law or by obligations pursuant to any listing agreement with any national securities exchange or as may be requested by a Governmental Authority, in which case the issuing party shall use its reasonable best efforts to consult with the other party before issuing any such release or making any such public statement, allow the other party reasonable time to comment on such release or public statement in advance of such issuance and shall accept any reasonable comments of such party; provided that the restrictions in this Section 6.07 shall not apply to any communication regarding a Change in Board Recommendation.

Section 6.08. Rule 16b-3. Prior to the Effective Time, the Company and the Company Board shall take all such steps as may be required, in accordance with the procedures set forth in Rule 16b-3 promulgated under the Exchange Act and in accordance with the Interpretative Letter dated January 12, 1999 issued by the SEC relating to Rule 16b-3, to cause any dispositions of equity securities of the Company (including derivative securities with respect to equity securities of the Company) resulting from the transactions contemplated hereby by each officer or director of the Company who is subject to Section 16 of the Exchange Act with respect to equity securities of the Company to be exempt under Rule 16b-3.

Section 6.09. Merger Sub. Parent shall take all actions necessary to (a) cause Merger Sub to perform its obligations under this Agreement and to consummate the Merger on the terms and conditions set forth in this Agreement and (b) cause the Surviving Corporation to perform its obligations under this Agreement.

Section 6.10. Company Convertible Notes. Each holder of a Company Convertible Note shall have executed a Company Convertible Note Acknowledgment (collectively, “Convertible Note Acknowledgments”) dated as of, and delivered to Parent on or before, the date hereof and binding as of the date hereof and effective as of the Effective Time, pursuant to which each holder of Company Convertible Notes shall acknowledge and agree to the treatment of the Company Convertible Notes as contemplated by this Agreement, including Section 2.01(c).

Section 6.11. Further Assurances. Subject to the other terms and conditions hereof (including Section 6.01 and Section 6.06), the Company, Parent and Merger Sub shall use their reasonable best efforts to take, or cause to be taken, all actions or to do, or cause to be done, all things necessary, proper, or advisable under applicable Laws to achieve the satisfaction of the conditions set forth in ARTICLE VII, and to consummate and make effective the Merger and the other transactions contemplated hereby as promptly as practicable. In case at any time after the Effective Time any further action is necessary or desirable to carry out the purposes of this Agreement, the proper officers and directors of the Surviving Corporation, Parent and Merger Sub shall use their reasonable best efforts to take, or cause to be taken, all such necessary actions.

Section 6.12. Termination of Certain Agreements. Evidence of termination of the Management Agreement, dated June 21, 2006, between Urology Associates of North Texas, L.L.P. and U.S. Medical Development, Inc. d/b/a USMD Cancer Treatment Centers shall have been delivered on or prior to the date hereof to Parent, such termination to be effective as of the Effective Time (the “MSA Termination Agreement”).

Section 6.13. Employment Agreements. Each of the Key Employees shall have entered into the Employment Agreements, dated as of, and delivered to Parent on or before, the date hereof and effective as of the Effective Time (collectively, the “Employment Agreements”).

Section 6.14. Non-Competition and Non-Solicitation Agreement. Xxxx Xxxxx shall have entered into the Non-Competition and Non-Solicitation Agreement, dated as of, and delivered to Parent on or before, the date hereof and effective as of the Effective Time (collectively, the “Non-Competition and Non-Solicitation Agreement”).

Section 6.15. Option Holder Acknowledgments. Each holder of Company Options shall have executed an option holder acknowledgment dated as of, and delivered to Parent on or before, the date hereof and effective as of the Effective Time, pursuant to which each holder of Company Options shall acknowledge and agree to the treatment of the Company Options as contemplated by this Agreement, including Section 2.02 (collectively, the “Option Holder Acknowledgments”).

Section 6.16. Resignation of Directors. Prior to the Effective Time, the Company shall use reasonable efforts to cause each member of the Company Board to execute and deliver a letter effectuating his or her resignation as a director of the Company Board effective at the Effective Time.

Section 6.17. Plan Adoption. Parent and the Surviving Corporation shall, promptly after the Closing, adopt and implement, or cause to be adopted and implemented, the plans disclosed in the disclosure schedule delivered by Parent to the Company immediately prior to the execution of this Agreement.

Section 6.18. Treatment of Ancillary Services. During the period from and after the Effective Time to the first anniversary of the Closing Date, (x) each of the Ancillary Services (as defined below) shall continue to be operated and controlled by the Company and its affiliates and subsidiaries, and (y) except as required pursuant to any Contract existing as of the date hereof, or subsequently entered into in accordance with Section 5.01, and except with the prior written consent of a majority of the physicians who are Company Employees affected thereby, none of Parent or the Surviving Corporation, directly or indirectly, shall elect to take any of the following actions: (a) the sale, conveyance, contribution or other transfer or modification of the Company’s downstream entities’ ownership interests or management rights in either USMD Hospital of Arlington or USMD hospital of Fort Worth to any person, (b) the sale, conveyance, contribution or other transfer or modification of USMD Diagnostics, LLC or its assets, including, but not limited to, its independent diagnostic testing facilities and certified laboratories to any person, (c) the sale, conveyance, contribution or other transfer of USMD CTC, LLC or its assets to any person, (d) the sale, conveyance, contribution or other transfer or assignment of the rights or obligations held by MCNT, PLLC under any physician employment agreement in effect as of the Effective Date to any other affiliate of Parent or other person without the express written consent of the physician who is a party to such physician employment agreement, or (e) the sale,

conveyance, contribution or other transfer of the limited partnership interests in Metro I Stone Management, Ltd., held by USMD, Inc. to any person (the assets, ownership interests, and services set forth in the foregoing clause (a) through clause (e) are, collectively, the “Ancillary Services”). Notwithstanding the foregoing, for the avoidance of doubt, Parent may transfer any such Ancillary Service to any of its affiliates or subsidiaries in connection with any internal reorganization; provided, that, following such transfer and until the first anniversary of the Closing Date, such Ancillary Service continues to remain an affiliate, or owned by an affiliate, of the Company, as applicable.

ARTICLE VII

CONDITIONS

Section 7.01. Conditions to Each Party’s Obligation to Effect the Merger. The respective obligations of each party to effect the Merger shall be subject to the satisfaction or, if permitted by applicable Law, waiver by Parent, Merger Sub and the Company at or prior to the Effective Time of each of the following conditions:

(a) Common Stockholder Approval. The Common Stockholder Approval shall have been obtained in accordance with applicable Law and the Company Organizational Documents. The Information Statement, if any, shall have been cleared by the SEC and mailed to stockholders of the Company (in accordance with Regulation 14C of the Exchange Act) at least twenty (20) days prior to the Closing Date.

(b) No Order or Actions. No Law or Order enacted, promulgated, issued, entered, amended or enforced by any Governmental Authority, whether temporary, preliminary or permanent (collectively, “Restraints”) shall be in effect enjoining, restraining, preventing or prohibiting consummation of the Merger or any of the other transactions contemplated hereby or making the consummation of the Merger or any of the transactions contemplated hereby illegal and no Actions brought by a Governmental Authority shall be threatened or pending before any Governmental Authority of competent jurisdiction for purposes of obtaining a Restraint.

(c) Antitrust. The waiting period (and any extension thereof) applicable to the Merger under the HSR Act and any Antitrust Law shall have been terminated or shall have expired.

(d) Regulatory Consents. All Approvals or Healthcare Permits set forth in Section 7.01(d) of the Disclosure Schedule shall have been obtained.

(e) Tail Policy. Each of Parent and the Company shall have received evidence of the effectiveness of the Tail Policy.

Section 7.02. Conditions to the Obligations of Parent and Merger Sub. The respective obligations of Parent and Merger Sub to effect the Merger shall be subject to the satisfaction or, if permitted by applicable Law, waiver by Parent and Merger Sub at or prior to the Effective Time of each of the following conditions:

(a) Representations and Warranties. (i) The representations and warranties of the Company set forth in this Agreement (other than the representations and warranties set forth in

Section 3.01, Section 3.02, Section 3.03, Section 3.05(a) – (c), Section 3.06(b) and Section 3.08) shall be true and correct at and as of the date hereof and at and as of the Effective Time as if made at and as of the Effective Time (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct only as of such earlier date) except where the failure of such representations and warranties to be so true and correct (without giving effect to any qualification as to materiality or Material Adverse Effect set forth therein) would not, individually or in the aggregate, have a Material Adverse Effect, (ii) the representations and warranties of the Company set forth in Section 3.01 (with respect to the Company and any of its operating subsidiaries only), Section 3.02(a) (first and second sentence only), Section 3.02(b) (first sentence only), Section 3.02(d) (first and third sentence only) and Section 3.03 shall be true and correct in all but de minimis respects at and as of the date hereof and at and as of the Effective Time as if made at and as of the Effective Time (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct in all but de minimis respects only as of such earlier date), (iii) the representations and warranties of the Company set forth in Section 3.02 (other than the representations and warranties set forth in Section 3.02(a) (first and second sentence only), Section 3.02(b) (first sentence only), Section 3.02(d) (first and third sentence only), Section 3.05(a) – (c) and Section 3.08 shall be true and correct in all material respects at and as of the date hereof and at and as of the Effective Time as if made at and as of the Effective Time (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct in all material respects only as of such earlier date), and (iv) the representations and warranties of the Company set forth in Section 3.06(b) shall be true and correct in all respects at and as of the date hereof and at and as of the Effective Time as if made at and as of the Effective Time.

(b) Performance of Obligations of the Company. The Company shall have performed or complied in all material respects with all obligations, agreements and covenants, required by this Agreement to be performed or complied with by the Company at or prior to the Effective Time.

(i) Parent shall have received at the Closing a certificate signed on behalf of the Company by the Chief Executive Officer or the Chief Financial Officer of the Company certifying that the conditions set forth in Section 7.02(a) and Section 7.02(b) have been satisfied.

(ii) Parent shall have received a recent (which shall be a date not more than thirty (30) days prior to the Closing Date) good standing certificate (or equivalent) from the secretary of state of the state of incorporation, formation or organization of the Company and each of its subsidiaries.

(iii) Parent shall have received a duly executed certification in compliance with Treasury Regulations Section 1.897-2(h), certifying that the Company is not and has not been a U.S. real property holding corporation.

(iv) No Transaction Documents shall have been terminated, rescinded, withdrawn, amended or modified in any way prior to the Effective Time.

(d) No Material Adverse Effect. Since the date of this Agreement, there shall not have occurred any Material Adverse Effect.

Section 7.03. Conditions to the Obligations of the Company. The obligations of the Company to effect the Merger shall be subject to the satisfaction on or prior to the Effective Time of each of the following conditions, any and all of which may be waived in whole or in part by the Company to the extent permitted by applicable Laws:

(a) Representations and Warranties. (i) The representations and warranties of Parent and Merger Sub set forth in this Agreement (other than the representations and warranties set forth in Section 4.01, Section 4.02 and Section 4.06) that are qualified by materiality shall be true and correct in all respects at and as of the date hereof and at and as of the Effective Time as if made at and as of the Effective Time (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct as of such earlier date), and (ii) the (x) representations and warranties of Parent and Merger Sub set forth in this Agreement that are not qualified by materiality shall be true and correct in all material respects and (y) the representations and warranties of Parent and Merger Sub set forth in Section 4.01 and Section 4.02 and Section 4.06 shall be true and correct in all but de minimis respects at and as of the date hereof and at and as of the Effective Time as if made at and as of the Effective Time (except to the extent that any such representation and warranty expressly speaks as of an earlier date, in which case such representation and warranty shall be true and correct in all but de minimis respects only as of such earlier date).

(b) Performance of Obligations of Parent and Merger Sub. Each of Parent and Merger Sub shall have performed in all material respects all obligations, and complied in all material respects with the agreements and covenants, required to be performed by it under this Agreement at or prior to the Effective Time.

(c) Parent and Merger Sub Closing Certificate. The Company shall have received at the Closing a certificate signed on behalf of each of Parent and Merger Sub by its respective Chief Executive Officer or the Chief Financial Officer certifying that the conditions set forth in Section 7.03(a) and Section 7.03(b) have been satisfied.

Section 7.04. Frustration of Closing Conditions. None of the Company, Parent or Merger Sub may rely, either as a basis for not consummating the Merger or for terminating this Agreement and abandoning the Merger, on the failure of any condition set forth in Section 7.01, Section 7.02 or Section 7.03, as the case may be, to be satisfied if such failure was primarily caused by such party’s breach of any provision of this Agreement or failure to use its commercially reasonable efforts to consummate the Merger and the other transactions contemplated by this Agreement, as required by and subject to Section 6.11.

ARTICLE VIII

TERMINATION, AMENDMENT AND WAIVER

Section 8.01. Termination or Abandonment. Anything contained in this Agreement to the contrary notwithstanding, this Agreement may be terminated and the transactions contemplated hereby may be abandoned at any time prior to the Effective Time (in all cases by action of the respective board of directors of the terminating party or parties (or, in the case of the Company, the Special Committee, if in existence)), whether before or after the Common Stockholder Approval:

(a) by mutual written consent of the Company and Parent;

(b) by either the Company or Parent:

(i) if the Closing shall not have occurred by 5:00 p.m., Dallas, Texas time, on April 29, 2017 (the “End Date”); provided, that, if on April 29, 2017, (A) the condition set forth in Section 7.01(c) is not satisfied and (B) all other conditions to the Closing are satisfied (or waived) or, with respect to those conditions which by their terms cannot be satisfied until the Closing, are capable of being satisfied on such date, then, the End Date shall automatically be extended until July 29, 2017; provided, further, that the right to terminate this Agreement pursuant to this Section 8.01(b)(i) shall not be available to any party where the failure of such party to fulfill any of its obligations under this Agreement (including a breach of any representation or warranty of such party resulting in the failure of the condition described in Section 7.02(a) or Section 7.03(a), as applicable) has primarily resulted in, or been the principal cause of, the failure of the Closing to have occurred on or before the End Date (including, in the case of Parent, any breach by Merger Sub);

(ii) if any Restraint having the effect set forth in Section 7.01(b) shall be in effect and is or shall have become final and nonappealable; provided, that, in the case of any such final, nonappealable Restraint, the party seeking to terminate this Agreement pursuant to this Section 8.01(b)(ii) shall have used its reasonable best efforts to have such Restraint lifted prior to such Restraint having become final and nonappealable to the extent required by Section 6.06; provided further that the right to terminate this Agreement pursuant to this Section 8.01(b)(ii) shall not be available to any party where the failure of such party to fulfill any of its obligations under, or a breach of any representation or warranty of such party set forth in, this Agreement has primarily resulted in, or been the principal cause of, the issuance of such Restraint; or

(iii) if a Company Stockholders Meeting is held or a Company Stockholders Consent is sought pursuant to Section 6.01, if the Common Stockholder Approval is not obtained at such Company Stockholders Meeting (including any adjournments or postponements thereof) or pursuant to such Company Stockholders Consent.

(i) if Parent or Merger Sub shall have breached or failed to perform any of its representations, warranties, covenants or agreements contained in this Agreement, which

breach or failure to perform (A) would give rise to a Parent Material Adverse Effect or the failure of a condition set forth in Section 7.01 or Section 7.03 to be satisfied or the failure of the Closing to occur, and (B) is either incurable or, if curable, is not cured by Parent or Merger Sub by the earlier to occur of (1) the thirtieth (30^th) day following receipt by Parent of written notice of such breach or failure to perform delivered by the Company, or (2) the End Date; provided, however, that the Company shall not have the right to terminate this Agreement pursuant to this Section 8.01(c)(i) if, at the time of delivery of such written notice, the Company is then in material breach of its obligations under this Agreement; provided, further, however, that the foregoing cure period shall not be available with respect to a breach or failure to perform any covenant or agreement required to be performed by Parent or Merger Sub on the Closing Date; it being acknowledged and agreed that any termination by the Company pursuant to this Section 8.01(c)(i) shall not constitute a Change in Board Recommendation; or

(ii) if, during the Applicable Period, the Company Board effects a Change in Board Recommendation due to a Superior Proposal and the Company has complied in all material respects with Section 6.03; provided that (A) as a condition of any termination of this Agreement by the Company pursuant to this Section 8.01(c)(ii), the Company will pay the Termination Fee prior to or substantially contemporaneously with such termination and (B) the Company Board has authorized the Company (subject to termination of this Agreement) to enter into a definitive agreement in respect of such Superior Proposal.

(d) by Parent:

(i) if the Company shall have breached or failed to perform any of its representations, warranties, covenants or agreements contained in this Agreement, which breach or failure to perform (A) would result in a failure of a condition set forth in Section 7.01 or Section 7.02 to be satisfied or failure of the Closing to occur, and (B) is either incurable or, if curable, is not cured by the Company by the earlier to occur of (1) the thirtieth (30^th) day following receipt by the Company of written notice of such breach or failure to perform delivered by Parent, or (2) the End Date; provided, however, that Parent shall not have the right to terminate this Agreement pursuant to this Section 8.01(d)(i) (x) if, at the time of delivery of such written notice, Parent or Merger Sub is then in material breach of its obligations under this Agreement or (y) during the pendency of an Action by the Company for specific performance of this Agreement; provided, further, however that the foregoing cure period shall not be available with respect to a breach or failure to perform any covenant or agreement required to be performed by the Company on the Closing Date;

(ii) if (A) the Company Board effects a Change in Board Recommendation (including if the Company Board or any committee thereof shall have resolved or publicly proposed to do so), (B) after a tender offer or exchange offer during the Applicable Period that, if successful, would result in any person or “group” (as defined in our under Section 13(d) of the Exchange Act) becoming a beneficial owner of twenty percent (20%) or more of the outstanding shares of Company Common Stock is commenced (other than by Parent or Merger Sub) and Parent requests that the Company

Board publicly confirm the Company Board Recommendation in accordance with Section 6.03(d)(i)(D), the Company Board shall have failed to recommend that the Company’s stockholders not tender their shares of Company Common Stock in such tender or exchange offer in accordance with Section 6.03(d)(i)(D) or (C) the Company materially breaches its obligations in Section 6.03 (including if the Company Board or any committee thereof shall have resolved or publicly proposed to do so); or

(iii) if the Ventures Consent is not delivered to Parent on or prior to the Stockholder Approval Deadline.

A terminating party shall provide written notice of termination to the other party or parties specifying the provisions hereof pursuant to which such termination is made and the reason(s) therefor.

Section 8.02. Termination Fees.

(a) If, but only if, this Agreement is terminated by:

(i) the Company pursuant to Section 8.01(c)(ii) (Superior Proposal), then, prior to or concurrently with such termination by the Company, the Company shall pay to Parent, by wire transfer of immediately available funds to one or more accounts designated by Parent in writing, $10,000,000 in cash (the “Termination Fee”); or

(ii) Parent pursuant to (A) Section 8.01(d)(ii)(A) in the case of a Change in Board Recommendation in response to a Superior Proposal, (B) Section 8.01(d)(iii) (Ventures Consent), (C) Section 8.01(d)(ii)(A) in the case of a Change in Board Recommendation in response to an Intervening Event (other than a Parent Material Adverse Effect), (D) Section 8.01(d)(ii)(B) (Tender Offer) or (E) Section 8.01(d)(ii)(C) (No Shop), then the Company shall, by the second (2^nd) business day following the date of termination of this Agreement, pay to Parent, by wire transfer of immediately available funds to one or more accounts designated by Parent in writing, the Termination Fee.

(b) If, but only if, this Agreement is terminated by the Company or Parent pursuant to (A) Section 8.01(b)(i) (End Date) and the Common Stockholder Approval has not been obtained following a Company Stockholders Meeting or Company Stockholders Consent or (B) Section 8.01(b)(iii) (No Vote), then, the Company shall, by the second (2^nd) business day following the date of termination of this Agreement, pay to Parent, by wire transfer of immediately available funds to one or more accounts designated by Parent in writing, $2,686,000 in cash (the “Naked-No Fee”), and, in the case of any event under this Section 8.02(b), (x) prior to such termination (in the case of a termination described in the foregoing clause (A) of this Section 8.02(b)) or prior to either the Company Stockholders Meeting or the end of the applicable solicitation period for the Company Stockholders Consent (in the case of a termination described in the foregoing clause (B) of this Section 8.02(b)), an Acquisition Proposal shall have been publicly announced, commenced, disclosed or otherwise publicly made known to the Company or Company Board (in any of the foregoing cases, other than pursuant to any disclosure made, directly or indirectly, by Parent, Merger Sub or any of their respective affiliates or Representatives), and (y), within twelve (12) months following the date of such termination, the Company enters into or

consummates a Qualifying Transaction, the Company shall pay to Parent, by wire transfer of immediately available funds to one or more accounts designated by Parent in writing, the Termination Fee (net of the Naked-No Fee previously paid to Parent or its designee pursuant to this Section 8.02(b)) by the second (2nd) business day following the date on which the Company consummates such Qualifying Transaction.

(c) Notwithstanding anything to the contrary contained in this Agreement, except in the case of fraud by the Company, Parent’s right to receive the Termination Fee or the Naked-No Fee, as applicable, from the Company pursuant to this Section 8.02 if, as and when due and payable shall be the sole and exclusive remedy of Parent and Merger Sub against the Company and its subsidiaries and any of its and their respective former, current or future affiliates, partners, members, stockholders, managers, directors, officers, employees, agents or assignees in the case of: (i) a termination of this Agreement pursuant to Section 8.01(b)(i) (if the Common Stockholder Approval has not been obtained following a Company Stockholders Meeting or Company Stockholders Consent), Section 8.01(b)(iii), Section 8.01(c)(ii), Section 8.01(d)(ii)(A) or Section 8.01(d)(ii)(B); or (ii) a termination of this Agreement pursuant to Section 8.01(d)(ii)(C) at any time other than during the Applicable Period. In no event shall Parent and Merger Sub be entitled to more than one recovery of the Termination Fee or the Naked-No Fee, as applicable, for a termination of this Agreement pursuant to any of Section 8.01(b)(i), Section 8.01(b)(iii), Section 8.01(c)(ii) or Section 8.01(d)(ii). The Company, Parent and Merger Sub acknowledge that the agreements contained in this Section 8.02 are an integral part of the transactions contemplated by this Agreement, and that, without these agreements, the Company, Parent and Merger Sub would not enter into this Agreement. Any amount not promptly paid when due under this Section 8.02 shall accrue interest from the date such payment was required to be paid at a rate equal to the prime rate as published in The Wall Street Journal in effect on the date such payment was required to be paid.

(d) In the event of the termination of this Agreement pursuant to Section 8.01, this Agreement will become null and void, except that (i) the provisions of this Section 8.02 and the provisions in ARTICLE IX (other than Section 9.11, which shall not survive the termination of this Agreement) shall survive the termination hereof and (ii) in the event this Agreement is terminated by a party pursuant to Section 8.01(c)(i), Section 8.01(d)(i) or, solely if such termination is during the Applicable Period, Section 8.01(d)(ii)(C), the liability of any party for damages for any willful or intentional breach by such party of the representations, warranties, covenants or agreements of such party set forth in this Agreement occurring prior to the termination of this Agreement shall survive the termination of this Agreement, except for the limitations set forth in Section 8.02 with respect to the Company. Except as provided in this Section 8.02, upon termination pursuant to this ARTICLE VIII, there will be no liability on the part of Parent, Merger Sub, the Company or its subsidiaries or their respective former, current or future partners, members, stockholders, directors, managers, officers, affiliates, employees, agents or assignees.

Section 8.03. Amendments and Waivers.

(a) Any provision of this Agreement may be amended or waived prior to the Effective Time if, but only if, such amendment or waiver is in writing and is signed, in the case of an amendment by each party to this Agreement or, in the case of a waiver, by each party

against whom the waiver is to be effective; provided, however, that (i) the Company may not consent to any amendment or waiver without the prior written consent of the Special Committee (or, if the Special Committee is no longer in existence, the Company Board) and (ii) without the further approval of the Company’s stockholders, no such amendment or waiver shall be made or given after the Common Stockholder Approval that requires the approval of the stockholders of the Company under the DGCL unless the required further approval is obtained.

(b) No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by applicable Law.

ARTICLE IX

GENERAL PROVISIONS

Section 9.01. Non-Survival. None of the representations, warranties, covenants and other agreements in this Agreement or in any schedule, certificate, instrument or other document delivered pursuant hereto by any party shall survive the Effective Time or, except as provided in Section 8.02(c), the termination of this Agreement pursuant to Section 8.01, as the case may be, except for those covenants and agreements contained herein that by their terms apply or are to be performed in whole or in part after the Effective Time or after termination of this Agreement, including those contained in Section 6.04 and Section 6.05.

Section 9.02. Fees and Expenses. Except as provided otherwise in Section 6.06(b), and Section 8.02 whether or not the Merger is consummated, all fees, costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such fees, costs and expenses. Notwithstanding anything to the contrary in this Agreement, all fees, costs and expenses of the Company, Parent and Merger Sub incurred in connection with any Action brought by the Company, Parent or Merger Sub to enforce the terms and provisions of this Agreement or the rights of any of the parties hereunder, the substantially prevailing party in such Action shall be entitled to receive from the other party (Parent and Merger Sub, in the event that the Company is the prevailing party, and the Company, in the event that Parent and Merger Sub are the prevailing parties) all documented fees, costs and expenses (including attorneys’ fees and court costs) actually incurred by the prevailing party in such Action.

Section 9.03. Certain Definitions. Capitalized terms used in this Agreement have the meanings set forth or referenced in Appendix A.

Section 9.04. Notices. All notices, requests, consents, claims, demands, waivers and other communications that are required or may be given in accordance with the terms of this Agreement shall be in writing and shall be deemed to have been duly given: (a) when delivered personally by hand, (b) the day following the day (except, if not a business day, then the next business day) on which the same has been delivered by a nationally recognized overnight delivery service (charges prepaid), (c) on the third (3^rd) business day following the date of mailing if delivered by registered or certified mail, return receipt requested, postage prepaid or

(d) on the date so delivered, or if delivered after 5:00 p.m., local time of the recipient, or on a day other than a business day, then on the next proceeding business day, when transmitted by facsimile or email in portable document format (PDF), upon written confirmation(other than the automatic confirmation that it is received from the recipient’s facsimile machine) of receipt by the recipient of such notice and if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service (charges prepaid). All notices hereunder shall be delivered as set forth below, or pursuant to such other instructions as may be designated in writing from time to time by the party to receive such notice in the manner provided in this Section 9.04:

If to the Company, to:

USMD Holdings, Inc.

0000 Xxxxx Xxxxx Xxxxxxx

000, Xxxxx 000, Xxxxxx, XX 00000

Attention: General Counsel

Facsimile: (000) 000-0000

E-mail: xxxxx.xxxx@xxxx.xxx

with a copy to:

XxXxxxxxx Will & Xxxxx, LLP

0000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000

Xxxxxx, Xxxxx 00000

Attn: P. Xxxxxxx Xxxxxxx

Facsimile: (000) 000-0000

E-mail: xxxxxxxx@xxx.xxx

and

Xxxxxx & Xxxxxx LLP

0000 Xxxx Xxxxxx, Xxxxx 0000

Xxxxxx, Xxxxx 00000

Attn: Xxxx Xxxxxxxx

Facsimile: (000) 000-0000

E-mail: xxxxxxxxx@xxxxx.xxx

If to Parent or Merger Sub, to:

WellMed Medical Management, Inc.

c/o UnitedHealth Group Incorporated

0000 Xxxx Xxxx Xxxx

Xxxxxxxxxx, Xxxxxxxxx 00000

Attn: Chief Legal Officer

Facsimile: (000) 000-0000

with a copy (which shall not constitute notice) to:

Xxxxx Lovells US LLP

0000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000

Xxxxxx, Xxxxxxxx 00000

Attn: Xxxxxxx X. Xxxxxx, Esq.

Facsimile: (000) 000-0000

Email: xxxxxxx.xxxxxx@xxxxxxxxxxxx.xxx

Section 9.05. Interpretation; Disclosure Schedule.

(a) When a reference is made in this Agreement to Appendices, Articles, Sections, Schedules or Exhibits, such reference shall be to an Appendix, Article, Section, Schedule or Exhibit of this Agreement, respectively, unless otherwise indicated. The table of contents and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed in each case to be followed by the words “without limitation”. The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole, including the exhibits and schedules hereto, and not to any particular provision of this Agreement. The term “or” is not exclusive. Unless the context of this Agreement clearly requires otherwise, references to the plural include the singular. References to a person are also to its permitted successors and assigns. Whenever the context may require, any pronoun in the masculine, feminine, and neuter gender shall include any other gender and words in the singular form shall be construed to include the plural and vice versa. Any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein and the rules and regulations promulgated thereunder. References to “dollars” or “$” shall mean United States dollars. Any reference to days means calendar days unless business days are expressly specified. When calculating the period of time before which, within which or following which any act is to be done or step taken pursuant to this Agreement, the date that is the reference date in calculating such period shall be excluded, and if the last day of such period is not a business day, the period shall end on the next succeeding business day. References to “written” or “in writing” include in electronic form.

(b) Except as otherwise provided in this Agreement, all payments pursuant hereto shall be made by wire transfer in United States Dollars in immediately available funds without any set-off, deduction, or counterclaim whatsoever.

(c) The parties hereto have participated jointly in the negotiation and drafting of this Agreement. If an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties and no presumption or burden of proof shall arise favoring or disfavoring any party because of the authorship of any provision of this Agreement.

(d) The parties acknowledge and agree that (i) the Disclosure Schedule may include certain items and information solely for informational purposes for the convenience of Parent and Merger Sub and (ii) the inclusion of any information in the Disclosure Schedule shall not be

deemed an admission or acknowledgment, in and of itself and solely by virtue of the inclusion of such information in the Disclosure Schedule, that such information is required to be listed in the Disclosure Schedule or that such items are material to the Company’s business, the Company or any of its subsidiaries. The headings, if any, of the individual sections of the Disclosure Schedule are inserted for convenience only and shall not be deemed to constitute a part thereof or a part of this Agreement. The Disclosure Schedule is arranged in sections corresponding to those contained in ARTICLE III merely for convenience, and the disclosure of an item or information in one section of the Disclosure Schedule as an exception to a particular representation or warranty shall be deemed adequately disclosed as an exception with respect to all other representations or warranties to the extent that the relevance of such item to such representations or warranties is reasonably apparent on the face of such item, notwithstanding the presence or absence of an appropriate section of the Disclosure Schedule with respect to such other representations or warranties or the presence or absence of a reference thereto in either the Disclosure Schedule or in the particular representation or warranty.

(e) The specification of any dollar amount in the representations and warranties or otherwise in this Agreement or in the Disclosure Schedule is not intended and shall not be deemed to be an admission or acknowledgment of the materiality of such amounts or items, nor shall the same be used in any dispute or controversy between the parties hereto to determine whether any obligation, item, or matter (whether or not described herein or included in any schedule) is or is not material for purposes of this Agreement (other than with respect to any representation, warranty, or provision of this Agreement in which such specification occurs).

(f) To the extent that a representation or warranty contained in this Agreement addresses a particular issue with specificity (a “Specific Representation”), and the representation or warranty set forth in Section 3.05(d) also addresses such issue, then such Specific Representation shall be deemed to control whether there has been a breach of representation or warranty with respect to such issue.

Section 9.06. Severability. Any term or provision of this Agreement that is invalid, illegal or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without rendering invalid, illegal or unenforceable the remaining terms and provisions of this Agreement or affecting the validity, legality or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction so long as the economic or legal substance of the transaction contemplated hereby is not affected in any manner materially adverse to any party. If any provision of this Agreement is so broad as to be unenforceable, the provision shall be interpreted to be only so broad as is enforceable.

Section 9.07. Entire Agreement; No Other Representations or Warranties.

(a) This Agreement (including the Disclosure Schedule and the appendices, exhibits and schedules to this Agreement), the Non-Disclosure Agreement and any documents delivered by the parties hereto in connection herewith constitute the entire agreement among the parties with respect to the subject matter hereof and thereof and supersede all prior agreements, understandings, negotiations, representations, correspondence, undertakings, and communications, both written and oral, among the parties with respect thereto.

(b) EACH PARTY AGREES THAT, EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES CONTAINED IN ARTICLE III AND ARTICLE IV OF THIS AGREEMENT, NONE OF THE COMPANY, PARENT OR MERGER SUB MAKES ANY OTHER EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES, AND EACH HEREBY DISCLAIMS ANY OTHER EXPRESS OR IMPLIED REPRESENTATIONS OR WARRANTIES MADE BY ITSELF OR ANY OF ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, FINANCIAL AND LEGAL ADVISORS OR OTHER REPRESENTATIVES, WITH RESPECT TO THE EXECUTION AND DELIVERY OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY, NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO ANY OTHER PARTY OR ANY OTHER PARTY’S REPRESENTATIVES OF ANY DOCUMENT OR OTHER INFORMATION.

(c) Parent and Merger Sub acknowledge and agree (each for itself and on behalf of its affiliates and Representatives) that (i) in making their determination to proceed with the transactions contemplated by this Agreement, Parent and Merger Sub have made their own independent inquiry and investigation into the Company and its subsidiaries, their businesses and operations and the transaction contemplated hereby and (ii) Parent and Merger Sub have not relied, and are not acting in reliance, on any representation, warranty or other statement of the Company, any of its subsidiaries or any of their respective Representatives, other than the representations and warranties of the Company expressly set forth in ARTICLE III of this Agreement.

Section 9.08. Assignment; Benefit. Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the parties (whether by operation of Law or otherwise) without the prior written consent of the other parties; provided that no such permitted assignment shall relieve the assigning party of its obligations hereunder if the assignee does not perform its obligations hereunder. Subject to the preceding sentence, this Agreement shall be binding upon and shall inure to the benefit of the parties and their respective successors and permitted assigns. Any purported assignment or delegation not permitted under this Section shall be null and void ab initio and shall have no force or effect. Notwithstanding anything contained in this Agreement to the contrary, nothing in this Agreement, expressed or implied, is intended or shall be interpreted to confer on any person other than the parties or their respective permitted successors and assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement (except as provided in Section 6.05 and ARTICLE I and ARTICLE II concerning payment to the holders of Company Common Stock, Company Options and Company Restricted Stock, which provisions shall inure to the benefit of the persons benefiting therefrom who are expressly intended to be third-party beneficiaries thereof and who may enforce the covenants contained therein; provided, however, that, prior to the Effective Time, the rights and remedies conferred on the holders of Company Common Stock, Company Options and Company Restricted Stock pursuant to ARTICLE I and ARTICLE II concerning the payments provided therefor under ARTICLE II may only be enforced by the Company acting on the behalf of such holders).

Section 9.09. Counterparts; Effect; Facsimile Signatures. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same agreement, and shall become effective when one or more

counterparts have been signed by each of the parties and delivered to the other parties, it being understood that all parties need not sign the same counterpart. The exchange of copies of this Agreement and of signature pages by facsimile, email in portable document format (PDF), or other electronic transmission shall constitute effective execution and delivery of this Agreement as to the parties and may be used in lieu of the original Agreement for all purposes. Signatures of the parties transmitted by facsimile, email in portable document format (PDF), or other electronic transmission shall be deemed to be their original signatures for all purposes.

Section 9.10. Governing Law; Consent to Jurisdiction; Waiver of Jury Trial.

(a) This Agreement shall be governed and construed in accordance with the internal Laws of the State of Delaware, without regard to any applicable conflicts of law provisions or rules (whether of the State of Delaware or any other jurisdiction) that may require the application of the Laws of any jurisdiction other than those of the State of Delaware.

(b) The parties hereby irrevocably and unconditionally submit to the exclusive jurisdiction of the Court of Chancery of the State of Delaware or, if such court lacks jurisdiction, the Superior Court of the State of Delaware sitting in New Castle County or the United States District Court for the District of Delaware in respect of the interpretation and enforcement of the provisions of this Agreement and of the documents referred to in this Agreement, and in respect of the transactions contemplated hereby and thereby, and hereby waive, and agree not to assert, as a defense in any Action for the interpretation or enforcement hereof or of any such document, that it is not subject thereto or that such Action may not be brought or is not maintainable in said courts or that the venue thereof may not be appropriate or that this Agreement or any such document may not be enforced in or by such courts, and the parties irrevocably agree that all claims with respect to such Action shall be heard and determined in the aforementioned courts. The parties hereby consent to and grant any such court jurisdiction over the person of such parties and over the subject matter of such dispute and agree that mailing of process or other papers in connection with any such Action in the manner provided in this Section 9.10 or in such other manner as may be permitted by Law shall be valid and sufficient service thereof.

(c) EACH PARTY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ALL OF ITS RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED UPON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT, OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY, OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (B) EACH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (C) EACH PARTY MAKES THIS WAIVER VOLUNTARILY, AND (D) EACH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS, AGREEMENTS, AND CERTIFICATIONS IN THIS SECTION 9.10.

Section 9.11. Specific Performance. Each party acknowledges that the other parties hereto would be irreparably damaged in the event that any of such party’s covenants or

obligations contained in this Agreement were not performed by such party in accordance with their specific terms or were otherwise breached. It is accordingly agreed that each party shall be entitled to seek and obtain temporary or permanent injunctive relief to prevent any breach or violation of this Agreement and to enforce specifically the covenants and obligations set forth in this Agreement, without proof of actual damages, in any court of competent jurisdiction specified in Section 9.10, this being in addition to any other right or remedy to which such party may be entitled to at law or in equity, and no bond or other security may be required from any party in connection therewith. If any action is brought by a party to enforce this Agreement, the other parties hereby waive the defense that there is an adequate remedy at law.

Section 9.12. Parent Guarantee. Parent shall cause Merger Sub to comply in all respects with each of the representations, warranties, covenants, obligations, agreements and undertakings made or required to be performed by Merger Sub in accordance with the terms of this Agreement, the Merger and the other transactions contemplated hereby. As a material inducement to the Company’s willingness to enter into this Agreement and perform its obligations hereunder, Parent hereby unconditionally guarantees full performance and payment by Merger Sub of each of the covenants, obligations and undertakings required to be performed by Merger Sub under this Agreement and the transactions contemplated hereby, subject to all terms, conditions and limitations contained in this Agreement, and hereby represents, acknowledges and agrees that any such breach of any such representation and warranty or default in the performance of any such covenant, obligation, agreement or undertaking of Merger Sub shall also be deemed to be a breach or default of Parent, and the Company shall have the right, exercisable in its sole discretion, to pursue any and all available remedies it may have arising out of any such breach or nonperformance directly against either or both of Parent and Merger Sub in the first instance. As applicable, references in this Section 9.12 to “Merger Sub” shall also include the Surviving Corporation following the Effective Time.

Section 9.13. No Recourse. This Agreement may only be enforced against, and any claims or causes of action that may be based upon, arise out of or relate to this Agreement, or the negotiation, execution or performance of this Agreement, may only be made against the entities that are expressly identified as parties hereto and then only with respect to the specific obligations set forth in this Agreement with respect to such entity. No past, present or future affiliate, director, officer, employee, incorporator, member, manager, partner, stockholder, agent, attorney or representative of any party shall have any liability for any obligations or liabilities of any party under this Agreement for any claim or cause of action based on, in respect of, or by reason of, the transactions contemplated hereby.

Section 9.14. Time. Time is of the essence in each and every provision of this Agreement.

[Signature Page Follows]

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed by their respective officers thereunto duly authorized as of the date first written above.


COMPANY

USMD Holdings, Inc.

By:		/s/ Xxxx Xxxxx, M.D.
Name:		Xxxx Xxxxx, M.D.
Title:		Chief Executive Officer

[Signature Page to Agreement and Plan of Merger]


PARENT

WELLMED MEDICAL MANAGEMENT, INC.

By:		/s/ Xxxxxx X. Xxxxxx III, M.D.
Name:		Xxxxxx X. Xxxxxx III
Title:		Chief Executive Officer

MERGER SUB

PROJECT Z MERGER SUB, INC.

By:		/s/ Xxxxxx X. Xxxxxx III, M.D.
Name:		Xxxxxx X. Xxxxxx III, M.D.
Title:		Chief Executive Officer

[Signature Page to Agreement and Plan of Merger]

APPENDIX A

Glossary of Defined Terms

“Acceptable Confidentiality Agreement” means a confidentiality agreement containing confidentiality, nondisclosure and standstill terms not less favorable to the Company in any material respect than those set forth in the Non-Disclosure Agreement, and with respect to any Protected Information (as defined in the Clean Room Agreement), the Clean Room Agreement; provided that such confidentiality agreement shall not prohibit compliance with any of the provisions of Section 6.03; provided further that an Acceptable Confidentiality Agreement may include provisions that are less favorable in the aggregate to the Company than those contained in the Non-Disclosure Agreement and, with respect to any Protected Information (as defined in the Clean Room Agreement), the Clean Room Agreement, so long as the Company offers to amend the Non-Disclosure Agreement or Clean Room Agreement, as applicable, concurrently with the execution of such Acceptable Confidentiality Agreement to include substantially similar provisions for the benefit of the parties thereto.

“Acquisition Proposal” means any unsolicited bona fide inquiry, proposal, indication of interest or offer made by any person or group of persons (other than Parent, Merger Sub or any of their affiliates) relating to, or that is reasonably likely to lead to, any direct or indirect acquisition or purchase, in one transaction or a series of related transactions, including any merger, reorganization, consolidation, tender offer, self-tender, exchange offer, stock acquisition, asset acquisition, binding share exchange, business combination, recapitalization, liquidation, dissolution, joint venture, payment of an extraordinary dividend (whether in cash or other property) or similar transaction, (i) of assets or businesses of the Company and its subsidiaries that generate more than twenty percent (20%) of the net revenues or net income or that account for more than twenty percent (20%) of the total assets (based on fair market value) of the Company and its subsidiaries, taken as a whole, immediately prior to such transaction, or (ii) of more than twenty percent (20%) of any class of capital stock, other equity security or voting power of the Company or any resulting parent company of the Company, in each case, other than the transactions contemplated hereby; provided, that an inquiry, proposal, indication of interest or offer shall not be deemed to be solicited by virtue of any actions taken by any Non-Solicit Party prior to the date of this Agreement.

“affiliate” means, unless otherwise indicated, any person that directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with the person specified, and the term “controls” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such person specified, whether through ownership of voting securities, by Contract or otherwise.

“Alternative Approval Determination” means either (i) Parent and the Company mutually determine, in good faith, after consulting with their respective outside legal counsel, that the Ventures Consent is insufficient for any reason to satisfy the Common Stockholder Approval or (ii) Parent and the Company mutually determine, in good faith, after consulting with their respective outside legal counsel, that the Company is required by applicable Law to obtain the Common Stockholder Approval by another means.

A-1

“Antitrust Laws” means applicable federal, state, local or foreign antitrust, competition, premerger notification or trade regulation Laws, including the Xxxxxxx Antitrust Act of 1890, the Xxxxxxx Act of 1914, the HSR Act and the Federal Trade Commission Act of 1914.

“Applicable Period” means the period beginning on the date of this Agreement and ending on the earlier of (i) the delivery of the Ventures Consent and (ii) termination of this Agreement pursuant to Section 8.01; provided, that if there shall be a Company Stockholders Consent or Company Stockholders Meeting as determined in accordance with Section 6.01, the Applicable Period shall also include the period beginning on the date of the Alternative Approval Determination and ending on the earlier of (x) the receipt of Common Stockholder Approval by either the Company Stockholders Consent or the Company Stockholders Meeting and (y) the termination of this Agreement pursuant to Section 8.01(b)(i).

“BAA” means any Contract that addresses the provisions for “business associate contracts” required by 45 C.F.R. § 164.504(e) or § 164.314(a).

“Business Associate” means a “business associate” as defined in 45 C.F.R. § 160.103 of HIPAA.

“business day” means any day that Nasdaq is normally open for trading and that is not a Saturday, Sunday or other day on which banks in the City of Dallas, Texas are authorized or required by Law to close for regular banking business.

“Clean Room Agreement” means that certain Clean Team Confidentiality Agreement dated as of March 18, 2016 between the Company and Optum, Inc.

“Company 10-K” means Items 1 (Business), 2 (Properties), 7 (Management’s Discussion and Analysis of Financial Condition and Results of Operations), 8 (Financial Statements, including the Notes to the Consolidated Financial Statements), 11 (Executive Compensation), and 12 (Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters), 14 (Principal Accounting Fees and Services) of the Company’s Annual Report on Form 10-K filed with the SEC on April 14, 2016 and as such items are amended, as applicable, on Form 10-K/A April 29, 2016.

“Company 10-Q” means Items 1 (Financial Statements) and 2 (Management’s Discussion and Analysis of Financial Condition and Results of Operations) of the Company’s Quarterly Report on Form 10-Q filed with the SEC on May 16, 2016.

“Company Board” means the board of directors of the Company, the Special Committee or any other committee of the board of directors of the Company, as the context requires.

“Company Convertible Notes” means, collectively, the Company’s 7.25% Convertible Subordinated Notes due 2020, the Company’s 7.75% Subordinated Notes due 2020 and the Company’s 5% Subordinated Notes due 2019.

“Contract” means any contract, obligation, plan, undertaking, arrangement, commitment, note, loan, credit agreement, debenture, bond, mortgage, indenture, agreement, deed of trust, lease, license or other legally binding commitment or agreement, whether written or oral.

A-2

“control” including the terms “controlling,” “controlled by” and “under common control with” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a person, whether through ownership of voting securities, by Contract or otherwise.

“Employment Law” means any Law applicable to hiring, termination, collective bargaining, compensation, harassment, discrimination, and retaliation in employment, affirmative action, immigration, work authorization, terms and conditions of employment, payroll tax withholding and deductions, unemployment compensation, worker’s compensation, worker classification (including the proper classification of workers as contingent workers, independent contractors and consultants), privacy, records and files, social security contributions, wages, hours of work, occupational safety and health, and all other employment practices.

“Environmental Law” means any applicable Law binding on the Company or its operations or property as of or prior to the date hereof relating in any way to the environment, natural resources or Hazardous Materials, including the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. sec. 9601 et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. sec. 6901 et seq.; the Federal Water Pollution Control Act, as amended, 33 U.S.C. sec. 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. sec. 2601 et seq.; the Clean Air Act, 42 U.S.C. sec. 7401 et seq.; Oil Pollution Act of 1990, 33 U.S.C. sec. 2701 et seq.; the Safe Drinking Water Act, 42 U.S.C. sec. 300f et seq.; and the Hazardous Materials Transportation Act, 49 U.S.C. sec. 5101 et seq., or any equivalent state or local Law.

“ERISA Affiliate” means, with respect to any entity, trade or business, any other entity, trade or business that is a member of a group described in Section 414(b), (c), (m) or (o) of the Code or Section 4001(b)(1) of ERISA that includes the first entity, trade or business, or that is a member of the same “controlled group” as the first entity, trade or business pursuant to Section 4001(a)(14) of ERISA.

“Federal Health Care Program” means any “federal health care program” as defined in 42 U.S.C. §1320a-7b(f), including Medicare, Medicaid, TRICARE, Children’s Health Insurance Plan (CHIP) and similar or successor programs.

“Governmental Authority” means any Federal, national, state, or local government or regulator or any court, arbitrator, agency or commission or other governmental, taxing or regulatory (including a stock exchange or other self-regulatory body) authority, official or bureau, board, political subdivision, tribunal, agency or other governmental instrumentality (including a public utility commission, public services commission or similar regulatory body), domestic, foreign or supranational; provided, however, that the term “Governmental Authority” as such term is used in Section 7.01(b) only, shall not include any arbitrator.

“Hazardous Materials” means any material, substance or waste that is regulated, classified, or otherwise characterized under or pursuant to any applicable Environmental Law as “hazardous,” “toxic,” a “pollutant,” “contaminant,” “radioactive,” or words of similar meaning or effect, including petroleum and its by-products, asbestos, polychlorinated biphenyls, radon, urea formaldehyde insulation, and chlorofluorocarbons.

A-3

“Healthcare Laws” means all Laws and Orders related to health care providers and facilities, participation in Federal Health Care Programs, the practice of medicine, institutional and professional licensure, pharmacology and dispensing medicines or controlled substances, medical documentation and professional orders, medical record retention, laboratory services, unprofessional conduct, fee-splitting, referrals, billing and submission of false or fraudulent claims, claims processing, quality, safety, medical necessity, medical privacy and security, patient confidentiality and informed consent, the hiring of employees or acquisition of services or supplies from persons excluded from participation in Federal Health Care Programs, standards of care, quality assurance, risk management, utilization review, peer review, mandated reporting of incidents, occurrences, diseases and events, and advertising or marketing of health care services, or otherwise relating to the regulation, provision or administration or, or payment for, healthcare products or services, including (i) all Laws relating to the billing or submission of claims, reimbursement or fraud and abuse, including, but not limited to, the False Claims Act (31 U.S.C. § 3729, et seq.), the Civil Monetary Penalties Law (42 U.S.C. § 1320a-7a), federal and state anti-kickback statutes (including 42 U.S.C. § 1320a-7b), federal and state referral laws (including 42 U.S.C. §1395nn), criminal false claims statutes (e.g. 18 U.S.C. §§ 287 and 1001), the Program Fraud Civil Remedies Act of 1986 (31 X.X.X. §0000, et seq.), the Beneficiary Inducement Statute (42 U.S.C. §1320a-7a(a)(5)), the Clinical Laboratory Improvement Act (42 U.S.C. § 263a, et seq.), the Medicare Prescription Drug, Improvement and Modernization Act of 2003 (P.L. 108-173, 117 Stat. 2066), the Food, Drug and Cosmetic Act of 1938 (21 U.S.C. § 301, et seq.), the Prescription Drug Marketing Act of 1987 (P.L. 100-293, 102 Stat. 95), the Deficit Reduction Act of 2005 (P.L. 109-171, 120 Stat. 4), the Controlled Substances Act (21 U.S.C. 801, et seq.) and HIPAA, and the rules and regulations promulgated under the foregoing statutes, as well as all applicable counterpart state Laws to any of the foregoing; (ii) Medicare (Title CVIII of the Social Security Act), as amended and the regulations promulgated thereunder, including all conditions of participation; (iii) Medicaid (Title XIX of the Social Security Act), as amended and the regulations promulgated thereunder, including all conditions of participation; (iv) TRICARE (10 U.S.C. Section 1071 et seq.), as amended and the regulations promulgated thereunder; (v) the Affordable Care Act, and the regulations promulgated thereunder; (vi) quality, safety and medical necessity Laws relating to the regulation, provision or administration of, or payment for, healthcare products or services; (vii) Laws relating to the regulation of the corporate practice of medicine; and (viii) licenses, permits or authorization Laws relating to the regulation, provision or administration of, or payment for, healthcare products or services.

“Healthcare Permits” means all Approvals, registrations, certificates or certificates of need, orders, qualifications, accreditations and other rights required by any Governmental Authority that are applicable to healthcare service providers providing the items and services that the Company and its subsidiaries provide.

“HIPAA” means the Health Insurance Portability and Accountability Act of 1996, P.L. 104-191 (including the Standards for Privacy of Individually Identifiable Health Information, the Security Standards for the Protection of Electronic Protected Health Information and the Standards for Electronic Transactions and Code Sets promulgated thereunder), the Health Information Technology for Clinical Health Act provisions of the American Recovery and Reinvestment Act of 2009, Pub. Law No. 111-5, and the implementing regulations of each.

A-4

“HSR Act” means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976 and the rules and regulations promulgated thereunder.

“Indebtedness” means, as of any time with respect to any person, any obligations (including, without limitation, principal, premium, accrued interest, reimbursement or indemnity obligations, bonds, financing arrangements, prepayment and other penalties, breakage fees, sale or liquidity participation amounts commitment and other fees and related expenses) and all other amounts payable in connection therewith (a) with respect to indebtedness of such person, in respect of borrowed money, issued in substitution for or exchange of borrowed money, or evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof), including factoring arrangements or asset securitizations; (b) representing foreign exchange contracts, interest rate and currency swap arrangements or any other arrangements designed to provide protection against fluctuations in interest or currency rates; (c) representing obligations to pay the deferred purchase price of goods and services (including any potential future earnout, indemnification, purchase price adjustment, release of “holdback” or similar payment, but excluding trade payables incurred in the ordinary course of business); (d) representing obligations under leases required in accordance with GAAP to be recorded as capital leases; (e) representing obligations secured by a Lien, other than a Permitted Lien, on the assets of such person; (f) representing obligations under conditional sale or other title retention agreements relating to any property purchased; (g) except for the Company Convertible Notes, any loans of any kind or nature between the Company, on the one hand, and any stockholder or any of its affiliates (other than the Company or any of its subsidiaries) or any stockholders, officers, directors, employees or agents of any such entities, on the other hand; or (h) any guarantee of any such obligations described in clauses (a) through (g) of this definition by such person.

“Information Privacy and Security Laws” means all Laws that are applicable to Company or its subsidiaries concerning the privacy, protection, transfer or security of Personal Information, and all regulations promulgated by Governmental Authorities thereunder, which include (to the extent applicable), but are not limited to, the following Laws and their implementing regulations or regulatory guidance, each as amended from time to time: HIPAA, the Federal Trade Commission Act, the CAN-SPAM Act, the Telephone Consumer Protection Act, the Telemarketing and Consumer Fraud and Abuse Prevention Act, Children’s Online Privacy Protection Act, state data security Laws, state social security number protection laws, state data breach notification laws, state consumer protection Laws, any Healthcare Laws pertaining to privacy or data security, and any applicable Laws concerning requirements for website and mobile application privacy policies and practices, call or electronic monitoring or recording or any outbound communications (including, but not limited to, outbound calling and text messaging, telemarketing, and email marketing).

“Intellectual Property” means all United States and foreign intellectual property rights, confidential information, and proprietary information, including, but not limited to, (a) patents and patent applications (including all reissuances, continuations, continuations-in-part, revisions, extensions and reexaminations thereof) and patent disclosures and inventions (whether or not

A-5

patentable and whether or not reduced to practice); (b) trademarks, service marks, trade dress, trade names, Internet domain names, assumed names and corporate names, together with the goodwill of the business associated with and symbolized by such trademarks, service marks, trade dress, trade names and corporate names, in each case whether or not registered; (c) published and unpublished works of authorship, whether copyrightable or not, including all statutory and common law copyrights associated therewith; (d) all registrations, applications, extensions and renewals for any of the items listed in clauses (b) and (c); (e) trade secrets; (f) websites; (g) all computer programs, including operating systems, applications, routines, interfaces, all algorithms, whether in source code or object code, and all associated documentation (collectively, “Software”); (h) lists of customers and potential customers (including any lists of electronic mail addresses of customers and potential customers); formulae; compositions; know how; research and development information; artwork and graphic design; manuscripts; drawings; specifications; lists of suppliers and service providers; pricing and cost information and records; test reports; manuals; financial, business, sales and marketing proposals, research, data, and plans; technical and computer data; databases; documentation; promotional materials and related information; (i) other intellectual property, confidential information and proprietary rights, in each case in any medium, including digital, and in any jurisdiction, together with all causes of action, judgments, settlements, claims and demands of any nature related thereto, including the right to prosecute any past, present or future infringements or other violations thereof; and (j) all tangible embodiments of any of the foregoing.

“Intervening Event” means a material fact, event, change, development or set of circumstances that first occurs, arises or becomes known to the Company or the Company Board after the date of this Agreement, to the extent that such material fact, event, change, development or set of circumstances or the consequences thereof were not reasonably foreseeable as of or prior to the date of this Agreement, except that in no event will (a) the receipt, existence or terms of an Acquisition Proposal or any matter relating thereto or consequence thereof, (b) any action taken by the parties pursuant to or in compliance with this Agreement, including any action taken in connection with seeking any Approval or (c) changes in the market price or trading volume of the Company Common Stock or the Company or any Company subsidiary meeting or exceeding internal or published projections, forecasts or revenue or earnings predictions for any period (except that the underlying causes of such change or result will not be excluded by this clause (c), except to the extent such underlying causes are otherwise excluded pursuant to clause (a) or (b)) constitute an “Intervening Event” or be taken into account in determining whether an Intervening Event has occurred or would reasonably be expected to result.

“Key Employees” means Xxxx Xxxxx and Xxxxxxx Xxxxxxxx.

“Knowledge” or “Knowledge of Parent” or “Knowledge of Merger Sub” or “Knowledge of the Company” means, (a) in the case of the Company, the actual knowledge of the executive officers, including, for the avoidance of doubt, the Chief Executive Officer, President, Chief Financial Officer, Chief Operations Officer, Chief Physician Officer, Chief Information Officer, Chief Accounting Officer, the General Counsel and Chief Compliance Officer of the Company and the actual knowledge of such individuals after reasonable inquiry, (b) in the case of Parent, the actual knowledge of Xxxx Xxxxxxxxxxx and Xxx Xxxxxxxxx and the actual knowledge of such individuals after reasonable inquiry and (c) in the case of Merger Sub, the actual knowledge of Xxxxxxx Xxxxxxx, Xxxx Xxxxx and Xxxx Xxxxxxx and the actual knowledge of such individuals after reasonable inquiry.

A-6

“Material Adverse Effect” means any event, circumstance, condition, change, effect, state of facts, development or occurrence that, individually or in the aggregate, has had or would reasonably be expected to have a material adverse effect on (a) the business, assets, liabilities, condition (financial or otherwise), or results of operations of the Company and its subsidiaries, taken as a whole, or (b) the ability of the Company to consummate the transactions contemplated hereby; provided, however, that, no event, circumstance, condition, change, effect, state of fact, development or occurrence to the extent arising out of, attributable to or resulting from the following shall be deemed to constitute a Material Adverse Effect or shall be taken into account when determining whether a Material Adverse Effect has occurred or would reasonably be expected to occur: (i) the announcement, pendency or consummation of the Merger (including any loss of or adverse change in the relationship of the Company and its subsidiaries with their respective employees, partners, customers or suppliers related thereto); (ii) changes in general economic, or financial market or political conditions; (iii) changes in the industries in which the Company and its subsidiaries operate; (iv) any changes (after the date hereof) in GAAP; (v) any acts of terrorism (including cyberattacks or cyber terrorism) or declared or undeclared acts of war or natural disasters; or (vi) the failure, in and of itself, by the Company to meet internal or analysts’ estimates or projections, performance measures, operating statistics or revenue or earnings predictions for any period or a decline, in and of itself, in the price or trading volume of shares of Company Common Stock (it being understood that the cause of such failure or decline may be taken into consideration when determining whether a Material Adverse Effect has occurred); provided, further, in the case of clauses (ii) - (v), such effect may be taken into account in determining whether or not there has been a Material Adverse Effect to the extent that such event, circumstance, condition, change, effect, state of facts, development or occurrence has a disproportionate adverse effect on the Company and its subsidiaries, taken as a whole, as compared to other participants in the industries in which the Company and its subsidiaries operate.

“Material Payor” means the ten (10) largest payors of the Company and its subsidiaries, taken as a whole, determined based on payments received from such payors during the twelve (12) month period ended December 31, 2015.

“Nasdaq” means the Nasdaq Global Market.

“Parent Material Adverse Effect” means any event, circumstance, condition, change, effect, state of facts, development or occurrence that, individually or in the aggregate, would reasonably be expected to prevent or materially delay consummation of the Merger or the other transactions contemplated hereby or materially impair or delay the ability of Parent or Merger Sub to perform their respective obligations under this Agreement.

“party” means the Company, Merger Sub, Parent or the Surviving Corporation, as the context requires.

“PCI DSS” means the Payment Card Industry Data Security Standard, issued by the Payment Card Industry Security Standards Council, as may be revised from time to time.

A-7

“Permitted Liens” means (i) Liens for Taxes, assessments, or other charges of any Governmental Authority or levies that are not yet due or payable and which are not delinquent or that are being contested in good faith and by appropriate proceedings and for which appropriate reserves have been established on the consolidated financial statements of the Company and its subsidiaries in accordance with GAAP; (ii) statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, materialmen, repairmen, and similar Liens imposed by applicable Law and arising in the ordinary course of business for amounts not yet due or delinquent or that are being contested in good faith and by appropriate proceedings and for which appropriate reserves have been established on the consolidated financial statements of the Company and its subsidiaries in accordance with GAAP; (iii) Liens incurred or deposits made in connection with workers’ compensation, unemployment insurance, or other types of social security and other restrictions or rights required to be granted to Governmental Authorities or otherwise imposed by Governmental Authorities under applicable Law; (iv) Liens securing obligations that are reflected as liabilities on the consolidated balance sheet of the Company and its subsidiaries or in the notes thereto; (v) Liens securing payment, or any obligation, of the Company or its subsidiaries with respect to the Company’s current credit facilities; (vi) Liens incurred in the ordinary course of business in connection with any purchase money security interests, equipment leases or similar financing arrangements; and (vii) covenants, conditions, restrictions, easements, imperfections of title and other similar non-monetary matters affecting title to the Company Real Property that do not materially impair the occupancy or use of such Company Real Property for the purposes for which it is currently used in connection with such person’s businesses; (viii) any right of way or easement related to public roads and highways that do not materially impair the occupancy or use of such Company Real Property for the purposes for which it is currently used in connection with the businesses of the Company or its subsidiaries; (ix) zoning, entitlement, building and other land use regulations imposed by Governmental Authorities having jurisdiction over the Company Real Property that are not violated by the current use and operation of such Company Real Property; (x) Liens, the existence of which are disclosed in the notes to the consolidated financial statements of the Company included in the Company’s audited balance sheets; and (xi) statutory, common law or contractual Liens of landlords or Liens against the interests of the landlord or owner of any Company Real Property unless caused by the Company or any of its subsidiaries.

“person” means any individual, corporation, company, partnership (limited or general), limited liability company, joint venture, association, trust, unincorporated organization or other business entity or “group” (as defined in the Exchange Act), including a Governmental Authority.

“Personal Information” means, collectively (i) any information that identifies, or in combination with other information may identify, an individual who is a patient, consumer or employee, including, without limitation, name, address, telephone number, health information (including protected health information (as defined in 45 C.F.R. § 160.103)), social security number, drivers’ license number, government issued identification number, any financial account numbers or log-in information, Internet Protocol addresses or other persistent device identifiers, or any other data that can be used to identify, contact, or precisely locate an individual; or (ii) any information that is governed, regulated or protected by one or more Information Privacy and Security Laws, including but not limited to, HIPAA; or (iii) any information that is covered by the PCI DSS. The term “Personal Information” does not include publicly available information relating to business contacts of business partners or vendors of the Company or its subsidiaries that is lawfully made available to the public.

A-8

“Proxy Statement” means a proxy statement relating to the matters to be submitted to the stockholders of the Company for the purpose of (i) obtaining the Company Stockholder Consent or (ii) convening a Company Stockholders Meeting, including any amendments or supplements thereto and any other required proxy materials (including the letter to stockholders, notice of meeting and form of proxy).

“Qualifying Transaction” means a transaction in respect of any Acquisition Proposal, except that references in the term “Acquisition Proposal” to “twenty percent (20%)” shall be deemed to be references to “fifty percent (50%)” for purposes of this definition.

“Release” means any emission, spill, seepage, leak, escape, leaching, discharge, injection, pumping, pouring, emptying, dumping, disposal, migration, or release of Hazardous Materials from any source into or upon the environment.

“Straddle Period” means a taxable period that includes, but does not end on, the Closing Date.

“subsidiary” or “subsidiaries” mean, with respect to a party, any person (other than an individual) of which at least fifty percent of the voting securities or other equity interests having by their terms ordinary voting power to elect a majority of the board of directors or others performing similar functions (or, in the case of a partnership, more than 50% of the partnership interests) with respect to such person is directly or indirectly owned or controlled by such party or by any one or more of its subsidiaries.

“Superior Proposal” means any written Acquisition Proposal that the Company Board determines in good faith (upon recommendation of the Special Committee and after consultation with its outside legal counsel and financial advisor), taking into account, among other things, (a) all legal, financial, regulatory and other aspects of the proposal deemed relevant by the Company Board and the person making the proposal, including the financing terms thereof and the likelihood of consummation (including the anticipated timing, conditions and prospects for completion of such proposal) and (b) any adjustments or revisions to the terms and conditions of this Agreement proposed by Parent in an offer that is in writing in response to such Acquisition Proposal pursuant to Section 6.03(e)(ii), is more favorable to the stockholders of the Company than the transactions contemplated hereby; provided that, for purposes of this definition of “Superior Proposal,” references in the term “Acquisition Proposal” to “twenty percent (20%)” shall be deemed to be references to “fifty percent (50%).”

“Takeover Statute” means any “fair price,” “moratorium,” “control share acquisition,” “business combination” or any other takeover or anti-takeover statute or similar federal or state Law (including Section 203 of the DGCL).

“Tax Return” means any return, declaration, report, claim for refund or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

A-9

“Taxes” means all federal, state, local or foreign taxes of any kind, together with any interest and any penalties, additions to tax or additional amounts imposed by any Governmental Authority and including any obligations to indemnify or otherwise assume or succeed to the Tax liability of any other person.

“Third Party Payor Programs” means all third party payor programs (including Medicare, Medicaid, TRICARE, Children’s Health Insurance Plan (CHIP), or any other federal or state health care programs, as well as Blue Cross and Blue Shield, managed care plans, workers compensation or any other private insurance program).

“Transaction Documents” means, collectively, the Convertible Note Acknowledgments, the MSA Termination Agreement, the Employment Agreements, the Non-Competition and Non-Solicitation Agreement, and the Option Holder Acknowledgments.


Actions		14
Affordable Care Act		18
Agreement		1
Ancillary Services		55
Appraisal Shares		5
Approvals		12
Balance Sheet Date		14
Cancelled Shares		3
Certificate		3
Certificate of Merger		2
Certificates		3
Change in Board Recommendation		45
Closing		2
Closing Date		2
Code		8
Common Stockholder Approval		24
Company		1
Company 401(k) Plan		48
Company Board Recommendation		11
Company Common Stock		3
Company Employee		16
Company Intellectual Property		24
Company Leases		27
Company Non-Solicit Parties		43
Company Option		3
Company Organizational Documents		9
Company Plans		16
Company Preferred Stock		9
Company Real Property		27
Company Reports		12
Company Restricted Stock		4
Company Securities		10
Company Stockholders Consent		40
Company Stockholders Meeting		40
Continuing Employee		47


Convertible Note Acknowledgments		53
Costs		49
Delaware Secretary of State		2
DGCL		1
Disclosure Schedule		8
DOJ		51
Effective Time		2
Employment Agreements		54
End Date		58
Equity Compensation Plan		3
ERISA		16
Exchange Act		12
Financial Advisor		32
Financial Statements		13
FTC		51
GAAP		13
Governmental Antitrust Authority		51
Indemnified Party		49
Information Statement		40
Insurance Policies		26
IT Assets		26
Laws		12
Leased Real Property		27
Licensed Intellectual Property		25
Liens		10
Material Contract		23
Merger		1
Merger Consideration		3
Merger Sub		1
MSA Termination Agreement		53
Naked-No Fee		60
Non-Competition and Non-Solicitation Agreement		54
Non-Disclosure Agreement		43
Non-Solicit Parties		43

A-10


Option Cash Payment		4
Option Holder Acknowledgments		54
Order		14
Organizational Documents		9
Other Non-Solicit Parties		43
Parent		1
Parent Employee Plans		47
Paying Agent		5
Payment Fund		5
Real Property Permits		28
Real Property Subleases		28
Registered Intellectual Property		24
Representatives		40
Restraints		55
Xxxxxxxx-Xxxxx Act		12
XXX		00


Xxxxxxx 000		00
Section 262		5
Securities Act		12
Security Risk Assessment		32
Software		A-6
Special Committee		1
Specific Representations		65
Stockholder Approval Deadline		39
Subsidiary Organizational Documents		9
Subsidiary Securities		10
Surviving Corporation		1
Tail Policy		50
Termination Fee		60
Ventures		24
Ventures Consent		39

A-11

Exhibit A

Form of Amended and Restated Certificate of Incorporation

AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION

USMD HOLDINGS, INC.

ARTICLE I

NAME

The name of the corporation is USMD Holdings, Inc. (the “Corporation”).

ARTICLE II

REGISTERED OFFICE AND AGENT

The address of the registered office of the Corporation in the State of Delaware is 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, in the County of New Castle, and the name of the registered agent for service of process at such address is The Corporation Trust Company.

ARTICLE III

PURPOSE AND POWERS

The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware (the “Delaware General Corporation Law”). The Corporation shall have all power necessary or convenient to the conduct, promotion or attainment of such acts and activities.

ARTICLE IV

CAPITAL STOCK

The total number of shares of stock that the Corporation shall have authority to issue is one thousand (1,000) shares, all of which shall be common stock having a par value of $0.01 per share.

ARTICLE V

BOARD OF DIRECTORS

The business and affairs of the Corporation shall be managed by or under the direction of a board of directors. The directors of the Corporation shall serve until the annual meeting of the stockholders of the Corporation or until their successor is elected and qualified. The number of directors of the Corporation shall be such number as from time to time shall be fixed by, or in the manner provided in, the bylaws of the Corporation. Unless and except to the extent that the bylaws of the Corporation shall otherwise require, the election of the directors of the Corporation need not be by written ballot. Except as otherwise provided in this Amended and Restated Certificate of Incorporation, each director of the Corporation shall be entitled to one vote per director on all matters voted or acted upon by the board of directors.

Ex. A-1

ARTICLE VI

LIMITATION OF LIABILITY; INDEMNIFICATION

No director of the Corporation shall be liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, provided that this provision shall not eliminate or limit the liability of a director (a) for any breach of the director’s duty of loyalty to the Corporation or its stockholders, (b) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (c) under Section 174 of the Delaware General Corporation Law, or (d) for any transaction from which the director derived an improper personal benefit. The Corporation shall indemnify its directors and officers to the fullest extent permitted by law. The Corporation, by approval of its board of directors, may in its discretion, indemnify the Corporation’s employees and agents. Any repeal or modification of this Article VI shall be prospective only and shall not adversely affect any right or protection of, or any limitation of the liability of, a director of the Corporation existing at, or arising out of facts or incidents occurring prior to, the effective date of such repeal or modification.

ARTICLE VII

BYLAWS

In furtherance and not in limitation of the powers conferred by the Delaware General Corporation Law, the board of directors of the Corporation is expressly authorized and empowered to adopt, amend and repeal the bylaws of the Corporation.

ARTICLE VIII

RESERVATION OF RIGHT TO AMEND CERTIFICATE OF INCORPORATION

The Corporation reserves the right at any time, and from time to time, to amend, alter, change, or repeal any provision contained in this Amended and Restated Certificate of Incorporation, and other provisions authorized by the laws of the State of Delaware in force at the time may be added or inserted, in the manner now or hereafter prescribed by law; and all rights, preferences, and privileges of any nature conferred upon stockholders, directors, or any other persons by and pursuant to this Amended and Restated Certificate of Incorporation in its present form or as hereafter amended are granted subject to the rights reserved in this Article VIII.

Ex. A-2

Exhibit B

Form of Amended and Restated Bylaws

AMENDED AND RESTATED

BYLAWS

USMD HOLDINGS, INC.

(Effective as of , 2016)

ARTICLE I

OFFICES, CORPORATE SEAL

Section 1.01. Registered Office. The registered office of the corporation in Delaware shall be that set forth in the Certificate of Incorporation or in the most recent amendment of the Certificate of Incorporation or in a certificate filed with the Secretary of State of Delaware changing the registered office.

Section 1.02. Other Offices. The corporation may have such other offices, within or without the State of Delaware, as the directors shall, from time to time, determine.

Section 1.03. Corporate Seal. The corporation shall have no seal.

ARTICLE II

MEETINGS OF STOCKHOLDERS

Section 2.01. Place and Time of Meetings. All meetings of the stockholders shall be held at such place as may be designated from time to time by the Board of Directors and, in the absence of such designation, shall be held at the principal executive office of the corporation. The directors shall designate the time of day for each meeting of the stockholders and, in the absence of such designation, every meeting of stockholders shall be held at ten o’clock a.m. local time at the place of such meeting. Notwithstanding the foregoing, the Board of Directors may determine that the meeting shall not be held at any place, but may instead be held by means of remote communication.

Section 2.02. Annual Meetings. Unless directors are elected by written consent in lieu of an annual meeting, the corporation shall hold annual meetings of stockholders on such date and at such time as shall be designated from time to time by the Board of Directors. If an annual meeting is held, then at such meeting the stockholders shall elect a Board of Directors and transact such other business as may properly be brought before the meeting. If a written consent electing directors is less than unanimous, such action by written consent may be in lieu of holding an annual meeting only if all of the directorships to which directors could be elected at an annual meeting held at the effective time of such action are vacant and are filled by such action.

Section 2.03. Special Meetings. Special meetings of the stockholders, called by the Board of Directors or the Chief Executive Officer, may be held at any time and for any purpose or purposes, unless otherwise prescribed by statute. Business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice thereof (except to the extent that such notice is waived or is not required as provided in the General Corporation Law of the State of Delaware (the “Delaware General Corporation Law”) or these Bylaws).

Ex. B-1

Section 2.04. Quorum, Adjourned Meetings. Stockholders may take action on a matter at a meeting only if a quorum exists with respect to that matter. Except as otherwise provided by statute or by the Certificate of Incorporation, the holders of a majority of the shares entitled to vote at the meeting, and who are present in person or represented by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business. Where a separate vote by a class or series or classes or series is required, a majority of the outstanding shares of such class or series or classes or series, present in person or represented by proxy, shall constitute a quorum entitled to take action with respect to that vote on that matter. Once a share is represented for any purpose at a meeting (other than solely to object (1) to holding the meeting or transacting business at the meeting, or (2) (if it is a special meeting) to consideration of a particular matter at the meeting that is not within the purpose or purposes described in the meeting notice), it is deemed present for quorum purposes for the remainder of the meeting and for any adjournment of that meeting unless a new record date is or must be set for the adjourned meeting. The holders of a majority of the voting shares represented at a meeting, whether or not a quorum is present, may adjourn such meeting from time to time.

Section 2.05. Voting. Unless otherwise provided in the Delaware General Corporation Law or in the corporation’s Certificate of Incorporation, and subject to the other provisions of these Bylaws, each stockholder shall be entitled to one vote on each matter, in person or by proxy, for each share of the corporation’s capital stock that has voting power and that is held by such stockholder. Cumulative voting shall not be allowed in the election of directors or for any other reason. No proxy shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period. A duly executed appointment of proxy shall be irrevocable if the appointment form states that it is irrevocable and if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power.

Section 2.06. Required Vote. When a quorum is present at any meeting of stockholders, all matters shall be determined, adopted and approved by the affirmative vote (which need not be by ballot) of the holders of a majority of the shares present in person or represented by proxy at the meeting and entitled to vote with respect to the matter, unless the proposed action is one upon which, by express provision of statute or of the Certificate of Incorporation, a different vote is specified and required, in which case such express provision shall govern and control with respect to that vote on that matter. If the Certificate of Incorporation provides for more or less than one vote for any share, on any matter, every reference in these Bylaws to a majority or other proportion of stock, voting stock or shares shall refer to a majority or other proportion of the votes of such stock, voting stock or shares. Where a separate vote by a class or classes is required, the affirmative vote of the holders of a majority of the shares of such class or classes present in person or represented by proxy at the meeting shall be the act of such class. Notwithstanding the foregoing, directors shall be elected by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors.

Section 2.07. Record Date. In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than sixty days nor less than ten days before the date of such meeting. If no record date is fixed by the Board of Directors, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting, unless the Board of Directors fixes a new record date for the adjourned meeting.

In order that the corporation may determine the stockholders entitled to consent to corporate action in writing without a meeting, the Board of Directors may fix a record date, which record date shall not precede the

Ex. B-2

date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than ten days after the date upon which the resolution fixing the record date is adopted by the Board of Directors. If no record date has been fixed by the Board of Directors, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board of Directors is required by the Delaware General Corporation Law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the corporation in the manner prescribed by Section 213(b) of the Delaware General Corporation Law. If no record date has been fixed by the Board of Directors and prior action by the Board of Directors is required by the Delaware General Corporation Law, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action.

Section 2.08. List of Stockholders. After the record date for a meeting of stockholders has been fixed, at least ten days before such meeting, the officer who has charge of the stock ledger of the corporation shall make a list of all stockholders entitled to vote at the meeting, arranged in alphabetical order and showing the address of each stockholder (but not the electronic mail address or other electronic contact information, unless the Board of Directors so directs) and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder for any purpose germane to the meeting for a period of at least ten days prior to the meeting: (1) on a reasonably accessible electronic network, provided that the information required to gain access to such list is provided with the notice of the meeting, or (2) during ordinary business hours, at the principal place of business of the corporation. If the meeting is to be held at a place, then such list shall also, for the duration of the meeting, be produced and kept open to the examination of any stockholder who is present at the time and place of the meeting. If the meeting is to be held solely by means of remote communication, then such list shall also be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access such list shall be provided with the notice of the meeting.

Section 2.09. Notice of Meetings. Notice of any meeting of stockholders, stating the place, if any, date and hour of the meeting, the means of remote communication, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such meeting, and (if it is a special meeting) the purpose or purposes for which the meeting is called, shall be given to each stockholder entitled to vote at such meeting not less than ten nor more than sixty days before the date of the meeting (except to the extent that such notice is waived or is not required as provided in the Delaware General Corporation Law or these Bylaws). Such notice shall be given in accordance with, and shall be deemed effective as set forth in, Sections 222 and 232 (or any successor section or sections) of the Delaware General Corporation Law.

Section 2.10. Waiver of Notice. Whenever the giving of any notice is required by statute, the Certificate of Incorporation or these Bylaws, a written waiver thereof signed by the person or persons entitled to said notice, or a waiver thereof by electronic transmission by the person entitled to said notice, delivered to the corporation, whether before or after the event as to which such notice is required, shall be deemed equivalent to notice. Attendance of a stockholder at a meeting shall constitute a waiver of notice (1) of such meeting, except when the stockholder at the beginning of the meeting objects to holding the meeting or transacting business at the meeting, and (2) (if it is a special meeting) of consideration of a particular matter at the meeting that is not within the purpose or purposes described in the meeting notice, unless the stockholder objects to considering the matter at the beginning of the meeting.

Section 2.11. Written Action. Any action required or permitted to be taken at a stockholders’ meeting may be taken without a meeting, without prior notice and without a vote, if the action is taken by persons who would be entitled to vote at a meeting and who hold shares having voting power equal to not less than the minimum number of votes that would be necessary to authorize or take the action at a meeting at which all shares entitled to vote were present and voted. The action must be evidenced by one or more written consents

Ex. B-3

describing the action taken, signed by the stockholders entitled to take action without a meeting, and delivered to the corporation in the manner prescribed by the Delaware General Corporation Law for inclusion in the minute book. No consent shall be effective to take the corporate action specified unless the number of consents required to take such action are delivered to the corporation within sixty days of the delivery of the earliest-dated consent. A telegram, cablegram or other electronic transmission, including e-mail, consenting to such action and transmitted by a stockholder or proxyholder, or by a person or persons authorized to act for a stockholder or proxyholder, shall be deemed to be written, signed and dated for the purposes of this Section 2.11, provided that any such telegram, cablegram or other electronic transmission sets forth or is delivered with information from which the corporation can determine (1) that the telegram, cablegram or other electronic transmission was transmitted by the stockholder or proxyholder or by a person or persons authorized to act for the stockholder or proxyholder and (2) the date on which such stockholder or proxyholder or authorized person or persons transmitted such telegram, cablegram or electronic transmission. The date on which such telegram, cablegram or electronic transmission is transmitted shall be deemed to be the date on which such consent was signed. No consent given by telegram, cablegram or other electronic transmission shall be deemed to have been delivered until such consent is delivered to the corporation in accordance with Section 228(d)(1) of the Delaware General Corporation Law. Written notice of the action taken shall be given in accordance with the Delaware General Corporation Law to all stockholders who do not participate in taking the action who would have been entitled to notice if such action had been taken at a meeting having a record date on the date that written consents signed by a sufficient number of holders to take the action were delivered to the corporation.

Section 2.12. Remote Communication. If authorized by the Board of Directors, and subject to such guidelines as the Board of Directors may adopt, stockholders and proxyholders not physically present at a meeting of stockholders may, by means of remote communication, participate in a meeting of stockholders and be deemed present in person and vote at such meeting whether such meeting is held at a designated place or solely by means of remote communication, provided that (1) the corporation implements reasonable measures to verify that each person deemed present and permitted to vote at the meeting by means of remote communication is a stockholder or proxyholder, (2) the corporation implements reasonable measures to provide such stockholders and proxyholders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the stockholders, including an opportunity to read or hear the proceedings of the meeting substantially concurrently with such proceedings, and (3) if any stockholder or proxyholder votes or takes other action at the meeting by means of remote communication, a record of such vote or other action is maintained by the corporation.

ARTICLE III

DIRECTORS

Section 3.01. General Powers. The business and affairs of the corporation shall be managed by or under the direction of the Board of Directors, subject to any limitation set forth in the Certificate of Incorporation or as otherwise may be provided in the Delaware General Corporation Law.

Section 3.02. Number. The number of directors of the corporation shall be determined from time to time by the Board of Directors but in no case shall the number of directors be less than one.

Section 3.03. Nomination and Term of Office. The Board of Directors shall nominate candidates to stand for election as directors; and other candidates also may be nominated by any corporation stockholder, provided such other nomination(s) are submitted in writing to the Secretary of the corporation, or such other officer of the corporation as may be designated by the Board of Directors, no later than ninety days prior to the meeting of stockholders at which such directors are to be elected, together with the identity of the nominator and the number of shares of the corporation’s stock owned, directly or indirectly, by the nominator. The directors shall be elected at the annual meeting of the stockholders, except as provided in Section 3.09 hereof, and each director elected shall hold office until such director’s successor is elected and qualified or until the director’s earlier death, resignation or removal. Directors need not be stockholders.

Ex. B-4

Section 3.04. Board Meetings. Regular meetings of the Board of Directors may be held without notice at such time and at such place as shall from time to time be determined by the Board of Directors. Special meetings of the Board of Directors may be called by any director on one day’s notice to each other director, either personally or by telephone, express delivery service (so that the scheduled delivery date of the notice is at least one day in advance of the meeting), telegram, facsimile transmission, electronic mail (effective when directed to an electronic mail address of the director), or other electronic transmission, as defined in Section 232(c) (or any successor section) of the Delaware General Corporation Law (effective when directed to the director), and on five days’ notice by mail (effective upon deposit of such notice in the mail). The notice need not describe the purpose of a special meeting.

Section 3.05. Waiver of Notice. A director may waive any notice required by statute, the Certificate of Incorporation or these Bylaws before or after the date and time stated in the notice. Except as set forth below, the waiver must be in writing, signed by the director entitled to the notice, or made by electronic transmission by the director entitled to the notice, and delivered to the corporation for inclusion in the minute book. Notwithstanding the foregoing, a director’s attendance at or participation in a meeting waives any required notice to the director of the meeting unless the director, at the beginning of the meeting, objects to holding the meeting or transacting business at the meeting and does not thereafter vote for or assent to action taken at the meeting.

Section 3.06. Quorum. A majority of the directors holding office immediately prior to a meeting of the Board of Directors shall constitute a quorum for the transaction of business at such meeting. The vote of a majority of the directors present at any meeting at which there is a quorum shall be the act of the Board of Directors, except as may be otherwise specifically provided by statute or by the Certificate of Incorporation or by these Bylaws.

Section 3.07. Remote Communications. Members of the Board of Directors may participate in a meeting of the Board of Directors by any communication by means of which all participating directors can simultaneously hear each other during the meeting. A director participating in a meeting by this means is deemed to be present in person at the meeting.

Section 3.09. Vacancies; Newly Created Directorships. Vacancies and newly created directorships resulting from any increase in the authorized number of directors may be filled by the affirmative vote of a majority of the directors then in office, although fewer than a quorum, or by a sole remaining director. The previous sentence notwithstanding, whenever the holders of any class or classes of stock or series thereof are entitled to elect one or more directors by the provisions of the Certificate of Incorporation, vacancies and newly created directorships of such class or classes or series may be filled by the affirmative vote of a majority of the directors elected by such class or classes or series thereof then in office, or by a sole remaining director so elected. Each director so chosen shall hold office until the next election of directors of the class to which such director was appointed, and until such director’s successor is elected and qualified, or until the director’s earlier death, resignation or removal. In the event that one or more directors resign from the Board of Directors, effective at a future date, a majority of the directors then in office, including those who have so resigned, shall have power to fill such vacancy or vacancies, the vote thereon to take effect when such resignation or resignations shall become effective, and each director so chosen shall hold office until the next election of directors, and until such director’s successor is elected and qualified, or until the director’s earlier death, resignation or removal.

Section 3.10. Removal. Any or all of the directors may be removed from office at any time, with or without cause, in accordance with Section 141(k) of the Delaware General Corporation Law.

Ex. B-5

Section 3.11. Written Action. Any action required or permitted to be taken at any meeting of the Board of Directors may be taken without a meeting if the action is taken by all members of the Board of Directors. The action must be evidenced by one or more consents in writing or by electronic transmission describing the action taken, signed by each director, and delivered to the corporation for inclusion in the minute book.

Section 3.12. Committees. The Board of Directors may designate one or more committees, each committee to consist of one or more directors. The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. If a member of a committee shall be absent from any meeting, or disqualified from voting thereat, the remaining member or members present and not disqualified from voting, whether or not such member or members constitute a quorum, may, by unanimous vote, appoint another member of the Board of Directors to act at the meeting in the place of such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board of Directors, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the corporation; but no such committee shall have the power or authority in reference to approving or adopting, or recommending to the stockholders, any action or matter (other than the election or removal of directors) expressly required by the Delaware General Corporation Law to be submitted to stockholders for approval or adopting, amending or repealing any Bylaw of the corporation; and unless the resolution designating the committee, these Bylaws or the Certificate of Incorporation expressly so provide, no such committee shall have the power or authority to declare a dividend, to authorize the issuance of stock, or to adopt a certificate of ownership and merger pursuant to Section 253 of the Delaware General Corporation Law. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the Board of Directors. Each committee shall keep regular minutes of its meetings and report the same to the Board of Directors, when required. Unless otherwise specified in the resolution of the Board of Directors appointing the committee, all provisions of the Delaware General Corporation Law and these Bylaws relating to meetings, action without meetings, notice (and waiver thereof), and quorum and voting requirements of the Board of Directors apply, as well, to such committees and their members. Unless otherwise provided in the Certificate of Incorporation, these Bylaws, or the resolution of the Board of Directors designating the committee, a committee may create one or more subcommittees, each subcommittee to consist of one or more members of the committee, and delegate to a subcommittee any or all of the powers and authority of the committee.

Section 3.13. Compensation. The Board of Directors shall from time to time determine the amount and type of compensation, if any, to be paid to directors for their service on the Board of Directors and its committees. No such payment shall preclude any director from serving the corporation in any other capacity and receiving compensation therefor.

ARTICLE IV

OFFICERS

Section 4.01. Offices Created; Election. The corporation shall have such officers as the Board of Directors, the Chief Executive Officer, if any, or the President, if any, from time to time may elect; provided, however, that the Chief Executive Officer and the President shall be elected by the Board of Directors. Any number of offices or functions of those offices may be held or exercised by the same person. The Board of Directors, the Chief Executive Officer or the President may elect officers at any time.

Section 4.02. Term of Office. Each officer shall hold office until his or her successor has been elected and qualified, unless a different term is specified at the time such officer is elected, or until his or her earlier death, resignation or removal.

Ex. B-6

Section 4.03. Removal of Officers. Any officer may be removed from office at any time, with or without cause, by the Board of Directors, the Chief Executive Officer or the President; provided, however, that the Chief Executive Officer or the President shall be removed only by the Board of Directors.

Section 4.04. Resignation. An officer may resign at any time by giving written notice to the corporation. A resignation will be effective upon its receipt by the corporation unless the resignation specifies that it is to be effective at some later time or upon the occurrence of some specified later event.

Section 4.05. Vacancies. A vacancy in any office may be filled by the Board of Directors, the Chief Executive Officer or the President; provided, however, that any vacancy in the office of Chief Executive Officer shall be filled, if at all, by the Board of Directors.

Section 4.06. Powers. Unless otherwise specified by the Board of Directors, each officer shall have those powers and shall perform those duties that are (1) set forth in these Bylaws (if any are so set forth), (2) specified at the time such officer is elected or in any subsequent resolution or document with respect to such officer’s duties authorized by the Board of Directors, the Chief Executive Officer or the President or (3) commonly incident to the office held. An officer elected or appointed pursuant to Section 4.01 may, without the approval of the Board of Directors, the Chief Executive Officer or the President, as applicable, delegate some or all of the duties and powers of an office to other persons.

Section 4.07. Chief Executive Officer. Unless provided otherwise by a resolution adopted by the Board of Directors, the Chief Executive Officer, if any: (1) shall have general active management of the business of the corporation; (2) shall see that all orders and resolutions of the Board of Directors are carried into effect; and (3) shall perform such other duties as from time to time may be assigned by the Board of Directors. If at any time the corporation does not have a President, or the President is absent, disqualified from acting, unable to act or refuses to act, then the Chief Executive Officer shall have the powers and authority of the President under the Delaware General Corporation Law and these Bylaws.

Section 4.08. Chief Financial Officer. Unless provided otherwise by a resolution adopted by the Board of Directors, the Chief Financial Officer, if any: (1) shall cause to be kept accurate financial records for the corporation; (2) shall render to the Chief Executive Officer, the President and the Board of Directors, whenever requested, an account of all the transactions and of the financial condition of the corporation; and (3) shall perform such other duties as may be prescribed by the Board of Directors, the Chief Executive Officer or the President from time to time.

Section 4.09. President. The President, if any, shall be subject to the direction and control of the Chief Executive Officer and the Board of Directors and shall have such powers and duties as the Board of Directors or the Chief Executive Officer may assign to the President. If the Chief Executive Officer is absent, disqualified from acting, unable to act or refuses to act, then the President shall have the powers of, and shall perform the duties of, the Chief Executive Officer.

Section 4.10. Vice Presidents. The Vice Presidents, if any, shall be subject to the direction and control of the Board of Directors, the Chief Executive Officer and the President and shall have such powers and duties as the Board of Directors, the Chief Executive Officer or the President may assign to them.

Section 4.11. Treasurer. The Treasurer, if any, shall be subject to the direction and control of the Board of Directors, the Chief Executive Officer, the Chief Financial Officer and the President, and shall have such powers and duties as the Board of Directors, the Chief Executive Officer, the Chief Financial Officer or the President may assign to the Treasurer.

Ex. B-7

Section 4.12. Secretary. The Secretary, if any, shall be subject to the direction and control of the Board of Directors, the Chief Executive Officer, the Chief Financial Officer and the President, and shall have such powers and duties as the Board of Directors, the Chief Executive Officer, the Chief Financial Officer or the President may assign to the Secretary.

Section 4.13. Other Officers. Any other officer elected by the Board of Directors, the Chief Executive Officer or the President shall have those powers and shall perform those duties that are (1) specified at the time such officer is elected or in any subsequent resolution or document with respect to such officer’s duties authorized by the Board of Directors, the Chief Executive Officer or the President and (2) commonly incident to the office held.

Section 4.14. Fidelity Bonds. The corporation may secure the fidelity of any or all of its officers or agents by bond or otherwise.

ARTICLE V

CAPITAL STOCK

Section 5.01. Certificate for Shares. The shares of the corporation shall be represented by certificates, provided that the Board of Directors may provide by resolution that some or all of any or all classes or series of the corporation’s stock shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is surrendered to the corporation. Every holder of stock represented by certificates, and, if stock is issued in uncertificated form, each holder thereof, shall be entitled upon request to have a certificate (representing the number of shares registered in certificate form) signed in the name of the corporation by the President or Vice-President, and by the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary of the corporation. Any or all the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar whose signature or facsimile signature appears on a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if such person were such officer, transfer agent or registrar at the date of issue.

Section 5.02. Issuance of Shares. The Board of Directors is authorized to cause to be issued shares of the corporation up to the full amount authorized by the Certificate of Incorporation in such amounts as may be determined by the Board of Directors and as may be permitted by law. No shares shall be allotted except in consideration of cash or other property, tangible or intangible, received or to be received by the corporation under a written agreement, of services rendered, or of other consideration as may be allowed under Section 152 of the Delaware General Corporation Law.

Section 5.03. Transfer of Shares. The shares of stock of the corporation shall be transferable on the books of the corporation by the holder thereof in person or by his or her attorney upon surrender for cancellation of a certificate or certificates for the same number of shares, or other evidence of ownership if no certificates shall have been issued, with an assignment and power of transfer endorsed thereon or attached thereto, duly executed, and with such proof of the validity of the signature as the corporation or its agents may reasonably require. The Board of Directors may appoint one or more transfer agents and registrars to maintain the share records of the corporation and to effect share transfers on its behalf.

Section 5.04. Stockholders of Record. The corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, to receive notifications, to vote as such owner, and to exercise all the rights and powers of an owner. The corporation shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise may be provided by the Delaware General Corporation Law.

Section 5.05. Loss of Certificates. Any stockholder claiming a certificate for shares to be lost, stolen or destroyed shall make an affidavit of that fact in such form as the Board of Directors shall require and shall, if the Board of Directors so requires, give the corporation a bond of indemnity in form, in an amount, and with one or more sureties satisfactory to the Board of Directors, to indemnify the corporation against any claim which may be made against it on account of the certificate alleged to have been lost, stolen or destroyed or on account of the reissue of such certificate, whereupon a new certificate may be issued in the same tenor and for the same number of shares as the one alleged to have been lost, stolen or destroyed.

Ex. B-8

ARTICLE VI

DIVIDENDS

Section 6.01. Declaration of Dividends. Subject to the provisions of the Certificate of Incorporation, of these Bylaws, and of law, the Board of Directors may declare dividends whenever, and in such amounts as, in its opinion, are deemed advisable.

Section 6.02. Entitled Stockholders. In order that the corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than sixty days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto.

ARTICLE VII

INDEMNIFICATION AND INSURANCE

Section 7.01. Authorization of Indemnification. Each person who was or is a party or is threatened to be made a party to or is involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative, investigative or otherwise and whether by or in the right of the corporation or otherwise (a “proceeding”), by reason of the fact that he or she, or a person of whom he or she is the legal representative, is or was a director or officer of the corporation or is or was serving at the request of the corporation as a director, officer, trustee, employee, partner (limited or general) or agent of another corporation or of a partnership, joint venture, limited liability company, trust or other enterprise, including service with respect to an employee benefit plan, shall be (and shall be deemed to have a contractual right to be) indemnified and held harmless by the corporation (and any successor to the corporation by merger or otherwise) to the fullest extent authorized by, and subject to the conditions and (except as provided herein) procedures set forth in the Delaware General Corporation Law, as the same exists or may hereafter be amended (but any such amendment shall not be deemed to limit or prohibit the rights of indemnification hereunder for past acts or omissions of any such person insofar as such amendment limits or prohibits the indemnification rights that said law permitted the corporation to provide prior to such amendment), against all expenses, liabilities and losses (including attorneys’ fees, judgments, fines, ERISA taxes or penalties and amounts paid or to be paid in settlement) reasonably incurred or suffered by such person in connection therewith; provided, however, that the corporation shall indemnify any such person seeking indemnification in connection with a proceeding (or part thereof) initiated by such person (except for a suit or action pursuant to Section 7.02 hereof) only if such proceeding (or part thereof) was authorized by the Board of Directors. Persons who are not directors or officers of the corporation and are not so serving at the request of the corporation may be similarly indemnified in respect of such service to the extent authorized at any time by the Board of Directors. The indemnification conferred in this Section 7.01 also shall include the right to be paid by the corporation (and such successor) the expenses (including attorneys’ fees) incurred in the defense of or other involvement in any such proceeding in advance of its final disposition; provided, however, that, if and to the extent the Delaware General Corporation Law requires, the

Ex. B-9

payment of such expenses (including attorneys’ fees) incurred by a director or officer in advance of the final disposition of a proceeding shall be made only upon delivery to the corporation of an undertaking by or on behalf of such director or officer to repay all amounts so paid in advance if it shall ultimately be determined that such director or officer is not entitled to be indemnified under this Section 7.01 or otherwise; and provided further, that such expenses incurred by other employees and agents may be so paid in advance upon such terms and conditions, if any, as the Board of Directors deems appropriate. The financial ability of any person to make a repayment contemplated by this Section 7.01 shall not be a prerequisite to the making of an advance.

Section 7.02. Right of Claimant to Bring Action Against the Corporation. In order for any claimant to seek indemnification from the corporation under this Article VII, the claimant shall deliver a written claim to the corporation specifying in reasonable detail the amount of indemnification sought and a description of the persons, dates and circumstances giving rise to the indemnification claim. Such determination shall be made: (a) by the Board of Directors by a majority of a quorum consisting of directors who were not parties to the proceeding giving rise to the indemnification claim, (2) if such a quorum is not obtainable, or, even if obtainable, a majority vote of such a quorum so directs, by independent legal counsel in a written opinion, or (c) by the corporation’s stockholders. If a claim under this Section 7.02 is not paid in full by the corporation within sixty days after a written claim has been received by the corporation, the claimant may at any time thereafter bring an action against the corporation to recover the unpaid amount of the claim and, if successful in whole or in part, the claimant shall be entitled to be paid also the expense of prosecuting such action. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in connection with any proceeding in advance of its final disposition where the required undertaking, if any is required, has been tendered to the corporation) that the claimant has not met the standards of conduct which make it permissible under the Delaware General Corporation Law for the corporation to indemnify the claimant for the amount claimed or is otherwise not entitled to indemnification under Section 7.01, but the burden of proving such defense shall be on the corporation. The failure of the corporation (in the manner provided under the Delaware General Corporation Law) to have made a determination prior to or after the commencement of such action that indemnification of the claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the Delaware General Corporation Law shall not be a defense to the action or create a presumption that the claimant has not met the applicable standard of conduct. Unless otherwise specified in an agreement with the claimant, an actual determination by the corporation (in the manner provided under the Delaware General Corporation Law) after the commencement of such action that the claimant has not met such applicable standard of conduct shall not be a defense to the action, but shall create a presumption that the claimant has not met the applicable standard of conduct.

Section 7.03. Non-exclusivity. The rights to indemnification and advance payment of expenses provided by Section 7.01 hereof shall not be deemed exclusive of any other rights to which those seeking indemnification and advance payment of expenses may be entitled under any Bylaw, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in his or her official capacity and as to action in another capacity while holding such office. No repeal or modification of the foregoing sentence shall adversely affect any right or protection of a director of the corporation existing by virtue of the foregoing sentence at the time of such repeal or modification.

Section 7.04. Survival of Indemnification. The indemnification and advance payment of expenses and rights thereto provided by, or granted pursuant to, Section 7.01 hereof shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee, partner or agent and shall inure to the benefit of the personal representatives, heirs, executors and administrators of such person.

Section 7.05. Insurance. The corporation shall have, to the fullest extent permitted by the Delaware General Corporation Law, the power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as

Ex. B-10

a director, officer, employee, partner (limited or general) or agent of another corporation or of a partnership, joint venture, limited liability company, trust or other enterprise, against any liability asserted against such person or incurred by such person in any such capacity, or arising out of such person’s status as such, and related expenses, whether or not the corporation would have the power to indemnify such person against such liability under the provisions of the Delaware General Corporation Law.

Section 7.06. Modification. Any repeal or modification of this Article VII shall be prospective only and shall not adversely affect any right or protection of, or any limitation of the liability of, a director or officer of the corporation existing at, or arising out of facts or incidents occurring prior to, the effective date of such repeal or modification.

ARTICLE VIII

AMENDMENTS

Section 8.01. Amendment. Subject to the limitations set forth in Section 7.06, these Bylaws may be altered, amended or repealed and new Bylaws may be adopted by the stockholders or by the Board of Directors at any regular meeting of the stockholders or of the Board of Directors, at any special meeting of the stockholders or of the Board of Directors or by written action by the stockholders or by the Board of Directors if notice of such alteration, amendment, repeal or adoption of new Bylaws be contained in the notice of such meeting or any notice required for such written action. The power of the Board of Directors to adopt, amend or repeal Bylaws shall not divest or limit the power of the stockholders to adopt, amend or repeal Bylaws, and a Bylaw amendment adopted by the stockholders which specifies the votes that shall be necessary for the election of directors shall not be further amended or repealed by the Board of Directors.

Any action taken or authorized by the stockholders or by the Board of Directors, which would be inconsistent with the Bylaws then in effect but is taken or authorized by a vote or written action that would be sufficient to amend the Bylaws so that the Bylaws would be consistent with such action, shall be given the same effect as though the Bylaws had been temporarily amended or suspended so far, but only so far, as is necessary to permit the specific action so taken or authorized.

ARTICLE IX

SECURITIES OF OTHER CORPORATIONS

Section 9.01. Voting Securities Held by the Corporation. Unless otherwise ordered by the Board of Directors, and subject to any limitations imposed by the Chief Executive Officer of the corporation, any elected or appointed officer of the corporation shall have full power and authority on behalf of this corporation (1) to attend any meeting of security holders of other corporations or legal entities in which this corporation may hold securities and to vote such securities on behalf of this corporation; (2) to execute any proxy for such meeting on behalf of this corporation; or (3) to execute a written consent or a written action in lieu of a meeting of such other corporation or legal entity on behalf of this corporation. The elected or appointed officer acting on behalf of this corporation shall possess and may exercise any and all rights and powers incident to the ownership of such securities that this corporation possesses. The Board of Directors or the Chief Executive Officer may, from time to time, grant such power and authority to one or more other persons. The corporation may rely on any instrument signed by an officer of any stockholder of the corporation as the act of such stockholder of the corporation, unless the Board of Directors or the Chief Executive Officer has knowledge that such reliance is not reasonable.

Section 9.02. Purchase and Sale of Securities. Unless otherwise ordered by the Board of Directors, and subject to any limitations imposed by the Chief Executive Officer of the corporation, any elected or appointed officer of the corporation shall have full power and authority on behalf of this corporation to purchase, sell, transfer or encumber any and all securities of any other corporation or legal entity, and may execute and deliver

Ex. B-11

such documents as may be necessary to effectuate such purchase, sale, transfer or encumbrance. The Board of Directors or the Chief Executive Officer may, from time to time, confer like powers upon any other person or persons.

ARTICLE X

GENERAL PROVISIONS

Section 10.01. Inspection of Books and Records. Any stockholder, in person or by attorney or other agent, shall, upon written demand under oath stating the purpose thereof, have the right during the usual hours for business to inspect for any proper purpose, and to make copies or extracts from: (1) the corporation’s stock ledger, a list of its stockholders, and its other books and records; and (2) other documents as required by law. A proper purpose shall mean a purpose reasonably related to such person’s interest as a stockholder. In every instance where an attorney or other agent shall be the person who seeks the right to inspection, the demand under oath shall be accompanied by a power of attorney or such other writing which authorizes the attorney or other agent to so act on behalf of the stockholder. The demand under oath shall be directed to the corporation at its registered office or at its principal place of business.

Section 10.02. Reserve. The directors of the corporation may set apart, out of the funds of the corporation available for dividends, a reserve or reserves for any proper purpose and may abolish any such reserve.

Section 10.03. Fiscal Year. The fiscal year of the corporation shall be fixed by resolution of the Board of Directors.

* * * * *

Ex. B-12

FINAL

Exhibit C

Form of Ventures Consent

WRITTEN CONSENT OF THE MAJORITY STOCKHOLDER

USMD HOLDINGS, INC.

August 29, 2016

In order to satisfy the requirements for consent of stockholders in lieu of a meeting pursuant to Section 228 of the General Corporation Law of the State of Delaware (the “DGCL”), UANT Ventures, L.P., a Texas limited partnership (“Ventures”), the holder of 8,667,800 shares of the common stock, par value $0.01 per share (each a “Share,” and collectively the “Shares”) of USMD Holdings, Inc., a Delaware corporation (the “Company”), constituting approximately 76.07% of the voting power of the issued and outstanding Shares, does hereby irrevocably consent as follows:

Adoption of the Merger Agreement

RECITALS

A. The Board of Directors of the Company (the “Board”) has (i) determined that (A) the Agreement and Plan of Merger by and among the Company, WellMed Medical Management, Inc., a Texas corporation (“Parent”), and Project Z Merger Sub, Inc., a Delaware corporation and a wholly-owned subsidiary of Parent (“Merger Sub”), dated as of August 29, 2016, a copy of which is attached hereto as Exhibit A (the “Merger Agreement”), upon the terms and subject to the conditions of which, among other things, Merger Sub will be merged with and into the Company, with the Company as the surviving corporation and a wholly-owned subsidiary of Parent (the “Merger”), (B) the Merger and (C) the other transactions contemplated by the Merger Agreement, are fair to, advisable, and in the best interests of the Company and its stockholders, (ii) approved and declared advisable the Merger Agreement and the transactions contemplated thereby in accordance with the DGCL, (iii) authorized the execution and delivery by the Company of, and the performance by the Company of its obligations under, the Merger Agreement and (iv) recommended that the stockholders of the Company adopt the Merger Agreement.

B. The Merger Agreement was executed by the parties thereto on August 29, 2016.

C. The Merger Agreement provides that each Share issued and outstanding immediately prior to the effective time of the Merger (the “Effective Time”) (other than (i) the Shares held by the Company in treasury or owned, directly or indirectly, by any wholly-owned subsidiary of the Company, (ii) the Shares owned, directly or indirectly, by Parent, Merger Sub or any other subsidiary of Parent and (iii) the Shares that are owned by stockholders who have properly perfected and not withdrawn a demand for appraisal rights pursuant to Section 262 of the DGCL) will be automatically cancelled, cease to exist and be converted into the right to receive $22.34 in cash (the “Merger Consideration”), payable without interest, less any required withholding taxes.

Ex. C-1

D. Representatives of Ventures have participated in the review and negotiation of the Merger Agreement and also reviewed such other information as such representatives believed necessary for Ventures and its limited partners to make an informed decision concerning Ventures’ consideration and consent to the adoption of the Merger Agreement, and representatives of Ventures have had the opportunity to consult with Ventures’ own legal, tax and/or financial advisor(s) regarding the consequences of the Merger, the Merger Agreement and the execution of this Written Consent to Ventures and its limited partners.

E. In the event of a consolidation or merger of the Company, Section 3.06(c)(i) of the Amended and Restated Limited Partnership Agreement of Ventures, dated February 14, 2014 (as amended, the “LP Agreement”), requires the General Partner of Ventures to vote the Shares owned by Ventures in accordance with the affirmative vote of the limited partners of Ventures representing at least 75% of the aggregate limited partnership interests of Ventures (such approval, the “LP Approval”).

F. Ventures, effective as of August 26, 2016, obtained the LP Approval by written consent of Ventures’ limited partners representing approximately 80.7% of the aggregate limited partnership interests of Ventures, and the LP Approval has not been terminated, rescinded, withdrawn, modified or amended. A copy of the form of written consent executed and delivered by the limited partners of Ventures is attached hereto as Exhibit B.

RESOLUTIONS

Ventures, acting in its capacity as the majority stockholder of the Company, hereby resolves as follows:

1. The Merger Agreement is hereby adopted, and the transactions and agreements contemplated thereby, including the Merger, are hereby approved in all respects.

2. Ventures hereby waives compliance with any and all notice requirements imposed by the Certificate of Incorporation of the Company, the Company’s Bylaws, the DGCL and any other applicable law.

3. Ventures hereby acknowledges that all Shares held by Ventures are owned free and clear of any liens, except for such transfer restrictions (i) of general applicability as may be provided under the Securities Act of 1933 and the rules and regulations promulgated thereunder, and other applicable securities laws and (ii) as may be contained in the LP Agreement.

4. Parent and the Company may rely upon the foregoing waivers, acknowledgments and agreements as being binding in all respects against Ventures and its limited partners.

5. Ventures hereby approves, on an advisory basis, the compensation being paid to the Company’s named executive officers upon a change in control of the Company, as disclosed in the Information Statement, including without limitation, the disclosures set forth under the headings “Interests of the Company’s Directors and Executive Officers in the Merger” and “Quantification of Potential Payments to Named Executive Officers in Connection with the Merger” and the executive compensation tables and related footnotes and narrative.

Ex. C-2

Termination of the Investor Rights Agreement

RECITALS

A. The Company and Ventures are parties to that certain Investor Rights Agreement, dated as of August 31, 2012 (the “XXX”).

B. Pursuant to Section 3(ii) of the XXX, without any further action by the parties thereto, the XXX will terminate and be of no further force or effect immediately before the closing of an acquisition of the Company by another entity by consolidation, merger or other reorganization in which Ventures will own, immediately after the acquisition transaction, securities representing less than 20% of the voting power of the Company or other entity surviving such transaction.

C. The Merger qualifies as an acquisition transaction as contemplated by Section 3(ii) of the XXX.

ACKNOWLEDGMENT

1. Ventures hereby acknowledges that the XXX will terminate and be of no further force or effect as of immediately before the Effective Time, with no further action being required by the Company or Ventures.

[The remainder of this page was intentionally left blank.]

Ex. C-3

This Written Consent is being executed, and is effective, as of the date first set forth above. Immediately following Ventures’ execution of this Written Consent, Ventures shall deliver this Written Consent to the Company and Parent in accordance with Section 6.01(a) of the Merger Agreement.


UANT VENTURES, L.P.

By:		UANT VENTURES GENPAR, L.L.C.,
		its General Partner

By:
		Name:
		Title:

Exhibit A

Merger Agreement

See attached.

Exhibit B

Form of Written Consent of Limited Partners of Ventures

UANT VENTURES, LP and UANT VENTURES GENPAR, LLC

PARTNERSHIP/MEMBERSHIP VOTE BY WRITTEN CONSENT

Distributed August 16, 2016


Name of Partner/Member submitting written vote:


Date:

Timeline:

Ballots distributed on August 16, 2016

Annual Meeting on August 24, 2016

Final votes due no later than 5:00pm on September 1, 2016

Capitalized terms are defined in the Amended and Restated Limited Partnership Agreement of UANT Ventures, LP and the Amended and Restated Company Agreement of UANT Ventures GenPar, LLC.

All motions are further described in the Notice of the Annual Meeting of the Partners of UANT Ventures, L.P. and the Members of UANT Ventures GenPar, L.L.C. distributed on August 16, and will be further discussed at the Annual Meeting on August 24, 2016. Before voting, a partner/member should read the Notice of the Annual Meeting and all of the related documents referenced in and distributed with that notice.

Motions:

Approve Merger of USMD Holdings, Inc. with an indirect subsidiary of UnitedHealth Group, Inc. Approval of this motion will include the following:

•

Authorize the Board of Managers to consent to the exchange of all 8,667,800 shares of Holdings for $22.34/share.

•

Authorize the Board of Managers to sign the Ventures Consent contingent on both (a) approval of the Board of Directors of USMD Holdings, Inc., and (b) the receipt of a fairness opinion from a financial advisor.

•

Authorize the Board of Managers to acknowledge the termination of an option to purchase an additional 68,982 shares of USMD Holdings, Inc. (impacts Class A only)

This motion will require both a ³75% vote of all Partnership Interests and a ³75% vote of Class A Partnership Interests.

YES – I agree with the motion

NO – I vote against the motion

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Table of Contents

AGREEMENT AND PLAN OF MERGER BY AND AMONG USMD HOLDINGS, INC. WELLMED MEDICAL MANAGEMENT, INC. AND PROJECT Z MERGER SUB, INC. Dated as of August 29, 2016

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