Exhibit 10.1

Execution

SECURITIES PURCHASE AGREEMENT

Securities Purchase Agreement (this “Agreement”), dated December 7, 2015, by and
among Accretive Health, Inc., a Delaware corporation (the “Company”), TCP-ASC
ACHI Series LLLP, a Delaware limited liability limited partnership
(the “Investor”), and, solely for purposes of Sections 8.11, 9.2, 10.1, 10.2 and
10.5 through 10.15, Ascension Health Alliance d/b/a Ascension (“Ascension
Health”).

WHEREAS, on the terms and conditions set forth in this Agreement, the Company
desires to sell, and the Investor desires to purchase, shares of the Company’s
8.00% Series A Convertible Preferred Stock, par value $0.01 per share (the
“Series A Preferred”);

WHEREAS, in connection with such purchase and sale, the Company and the Investor
desire to make certain representations and warranties and enter into certain
agreements;

WHEREAS, in connection with such purchase and sale, the Company and the Investor
will execute and deliver among other things; (i) a registration rights agreement
in the form attached as Exhibit A (the “Registration Rights Agreement”), (ii) an
investor rights agreement in the form attached as Exhibit B (the “Investor
Rights Agreement”), and (iii) a warrant in the form attached as Exhibit C (the
“Warrant Agreement”); and

WHEREAS, in connection with the execution and delivery of this Agreement, and as
a condition and inducement to the Company’s willingness to enter into this
Agreement, the Investor has delivered to the Company the Equity Funding Letter
(as defined below), pursuant to which the investors named therein (the “Equity
Investors”) have, subject to the terms and conditions set forth therein,
committed to provide all of the funds to the Investor that are necessary for the
Investor to finance all of the Investor’s obligations at Closing (as defined
below) contemplated hereby.

NOW THEREFORE, in consideration of the foregoing and the representations,
warranties and agreements set forth in this Agreement, and intending to be
legally bound by this Agreement, the Company and the Investor agree as follows:

1. Definitions. As used in this Agreement, the following terms shall have the
respective meanings set forth in this Section 1:

“2014 Annual Report” shall have the meaning set forth in Section 4.13(e).

“Acceptable Confidentiality Agreement” shall mean a customary confidentiality
agreement (which need not prohibit the making of a Takeover Proposal) with terms
no less favorable in the aggregate to the Company than those contained in the
Confidentiality Agreement (other than that it need not prohibit the making of a
Takeover Proposal); provided that an Acceptable Confidentiality Agreement may
include provisions that are less favorable in the aggregate to the Company than
those contained in the Confidentiality Agreement so long as the Company offers
to amend the Confidentiality Agreement concurrently with execution of such
Acceptable Confidentiality Agreement to include substantially similar provisions
for the benefit of the parties thereto.

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“Affiliate” shall mean, as to any Person, any other Person that, directly or
indirectly, controls, or is controlled by, or is under common control with, such
Person. For this purpose, “control” (including, with its correlative meanings,
“controlled by” and “under common control with”) shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of
management or policies of a Person, whether through the ownership of securities
or partnership or other ownership interests, by contract or otherwise.

“Antitrust Laws” shall have the meaning set forth in Section 8.7.

“ARRA” shall mean the Health Information Technology for Economic and Clinical
Health Act provisions of the American Recovery and Reinvestment Act of 2009,
Pub. Law No. 111-5 and its implementing regulations 42 C.F.R. §§ 412, 413, 422
and 495.

“Ascension Health” shall have the meaning set forth in the preamble of this
Agreement.

“Authorizations” shall have the meaning set forth in Section 8.7.

“Board” shall mean the Board of Directors of the Company.

“Business Day” shall mean a day except a Saturday, a Sunday or other day on
which the SEC or banks in the City of New York are authorized or required by Law
to be closed.

“Clayton Act” shall mean the Clayton Act of 1914.

“Closing” shall have the meaning set forth in Section 3.

“Closing Date” shall have the meaning set forth in Section 3.

“Code” shall mean the Internal Revenue Code of 1986, together with all
regulations, rulings and interpretations thereof or thereunder by the Internal
Revenue Service.

“Common Stock” shall mean the common stock of the Company, par value $0.01 per
share.

“Company” shall have the meaning set forth in the preamble of this Agreement.

“Company Charter Documents” shall mean the certificate of incorporation and
bylaws of the Company, in each case as amended to the date of this Agreement.

“Company Financial Advisor” shall have the meaning set forth in Section 4.20.

“Company Material Contract” shall have the meaning set forth in Section 4.10.

“Company Permits” shall have the meaning set forth in Section 4.15.

“Company Plans” shall mean (a) each material “employee benefit plan” (as such
term is defined in Section 3(3) of ERISA) that the Company or any Company
Subsidiary sponsors, participates in, is a party or contributes to, or with
respect to which the Company or any Company Subsidiary could reasonably be
expected to have any material liability and (b) each

 

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other material fringe benefit or employee benefit plan, program or arrangement,
including any stock option, stock purchase, stock appreciation right or other
stock or stock-based incentive plan, cash bonus or incentive compensation
arrangement, retirement or deferred compensation plan, supplemental executive
retirement plan, profit sharing plan, unemployment or severance compensation
plan, vacation, or employment or individual consulting agreement, in each case
whether written or unwritten, for any current or former employee or director of,
or other individual service provider to, the Company or any Company Subsidiary
that does not constitute an “employee benefit plan” (as defined in Section 3(3)
of ERISA), that the Company or any Company Subsidiary presently sponsors,
participates in, is a party or contributes to, or with respect to which the
Company or any Company Subsidiary could reasonably be expected to have any
material liability, but other than any Foreign Benefit Plan or any benefit or
compensation plan, program or arrangement sponsored, maintained or administered
by a Governmental Authority or required to be maintained or contributed to by
Law.

“Company Stock Plans” shall mean, collectively, the Amended and Restated Stock
Option Plan adopted February 22, 2006, the Amended and Restated 2010 Stock
Incentive Plan and any other plan, program or arrangement providing for the
grant of equity-based awards to directors, officers, employees or other service
provides of the Company or any Company Subsidiaries.

“Company Subsidiaries” shall mean all Subsidiaries of the Company.

“Confidentiality Agreement” shall mean that certain Confidentiality Agreement,
dated as of September 24, 2014, between Ascension Health Alliance d/b/a
Ascension and the Company as supplemented by the letter agreement, dated
September 30, 2014, between Ascension Health Alliance d/b/a Ascension and
TowerBrook Capital Partners L.P., in each case as may be amended from time to
time.

“Contract” shall mean, with respect to any Person, any legally binding loan or
credit agreement, debenture, note, bond, mortgage, indenture, deed of trust,
lease, sublease, commitment, sale or purchase order, license, contract or other
agreement, instrument or obligation, whether written or oral, to which such
Person is a party or by which such person or such Person’s properties or assets
are bound.

“Deductible” shall have the meaning set forth in Section 10.4(a).

“DGCL” shall mean the General Corporation Law of the State of Delaware.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974.

“Equity Financing” shall have the meaning set forth in Section 5.7.

“Equity Funding Letter” shall have the meaning set forth in Section 5.7.

“Equity Investors” shall have the meaning set forth in the recitals of this
Agreement.

“Exchange” shall have the meaning set forth in Section 8.10.

 

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“Exchange Act” shall mean the U.S. Securities Exchange Act of 1934, and the
rules and regulations promulgated by the SEC thereunder.

“Federal Trade Commission Act” shall mean the Federal Trade Commission Act of
1914.

“Filed SEC Reports” shall mean all forms, statements, certifications, reports
and documents required to be filed or furnished by the Company with the SEC
pursuant to the Exchange Act on or after January 1, 2014 (collectively, and in
each case including all exhibits and schedules thereto and documents
incorporated by reference therein, as such statements and reports may have been
amended since the date of their filing), but excluding any disclosure under the
headings “Risk Factors,” “Forward Looking Statements,” or any similar
precautionary, predictive or forward-looking sections included therein.

“Foreign Benefit Plan” shall mean any compensation or benefit plan or
arrangement that is maintained or contributed to by the Company or any Company
Subsidiary for the benefit of employees or individual workers located primarily
outside the United States, other than any benefit or compensation plan or
arrangement maintained by a Governmental Authority or required to be maintained
or contributed to by Law.

“Fundamental Reps” shall have the meaning set forth in Section 10.3.

“GAAP” shall mean United States generally accepted accounting principles, as in
effect from time to time, applied on a consistent basis.

“Governmental Authority” shall mean any foreign governmental authority, the
United States of America, any state of the United States and any political
subdivision of any of the foregoing, and any agency, instrumentality,
department, commission, board, bureau, central bank, authority, court or other
tribunal, in each case whether executive, legislative, judicial, regulatory or
administrative.

“Government Sponsored Health Care Program” shall mean (a) the Medicare Program
established under and governed by the applicable provisions of Title XVIII of
the Social Security Act, the regulations promulgated thereunder and any
sub-regulatory guidance issued, (b) the Medicaid program governed by the
applicable provisions of Title XIX of the Social Security Act, the regulations
promulgated thereunder, as well as any state Law implementing the Medicaid
program, and (c) any other state or federal health care program or plan.

“Health Care Laws” shall mean any and all Laws pertaining to health regulatory
matters including, without limitation, laws relating to: (a) the licensure,
certification, qualification or authority to transact business in connection
with the provision of, payment for, or arrangement of, health care services,
including Laws that regulate providing administrative services or other
functions in connection with, the provision of, payment for or arrangement of
health care services; (b) health care or health insurance fraud and abuse,
including but not limited to the federal health care program anti-kickback
statute (42 U.S.C. § 1320a-7b(b)), the federal civil False Claims Act (31 U.S.C.
§ 3729 et seq.), and the federal Civil Monetary Penalties Law (42 U.S.C.
§§ 1320a-7,1320a-7a and 1320a-7b), and similar state laws; (c) Government
Sponsored Health Care Programs; (d) quality, safety certification and
accreditation standards and requirements; (e) the provision of administrative,
management or other services to any health

 

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care providers, including the administration of health care claims or benefits
or processing or paying for health care services, treatment or supplies
furnished by providers; (f) the Emergency Medical Treatment and Labor Act (42
U.S.C. § 1395dd) and (g) all Information Laws.

“HIPAA” shall mean the Health Insurance Portability and Accountability Act of
1996, as amended by ARRA, and as otherwise may be amended from time to time,
including the Privacy Standards (45 C.F.R. Parts 160 and 164), the Electronic
Transactions Standards (45 C.F.R. Parts 160 and 162), and the Security Standards
(45 C.F.R. Parts 160, 162 and 164) promulgated under the Administrative
Simplifications subtitle of the Health Insurance Portability and Accountability
Act of 1996.

“HSR Act” shall mean the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

“Indebtedness” shall mean any (a) indebtedness for borrowed money,
(b) indebtedness evidenced by any bond, debenture, mortgage, indenture or other
debt instrument or debt security, (c) accounts payable to trade creditors and
accrued expenses, in each case, not arising in the ordinary course of business,
(d) amounts owing as deferred purchase price for the purchase of any property,
(e) capital lease obligations and (f) guarantee of any such indebtedness,
obligations or debt securities of a type described in clauses (a) through and
(e) above of any other Person.

“Indemnifiable Health Care Matter” shall have the meaning set forth in
Section 10.4.

“Indemnitees” shall have the meaning set forth in Section 10.4.

“Indemnified Liabilities” shall have the meaning set forth in Section 10.4.

“Indemnity Percentage” means the percentage resulting from (x) the Ownership
Percentage divided by (y) 1 minus the Ownership Percentage.

“Information Laws” shall mean all applicable Laws concerning the privacy or
security (or both) of personal data of or concerning an individual (including
“Protected Health Information” as that term is defined under HIPAA), including,
where applicable, HIPAA, ARRA and state data breach notification Laws.

“Intellectual Property” shall have the meaning set forth in Section 4.11.

“Investor” shall have the meaning set forth in the preamble of this Agreement.

“Investor Rights Agreement” shall have the meaning set forth in the recitals of
this Agreement.

“Knowledge” of the Company shall mean the actual knowledge, as of the date of
this Agreement, of Dr. Emad Rizk, Peter Csapo, Joseph Flanagan, David Mason,
Daniel Zaccardo, Corey Perman and Erik Sprotte, after reasonable inquiry of
their respective direct reports.

“Law” shall mean any applicable federal, state, local, foreign or other law,
statute, regulation, rule, ordinance, code, convention, directive, order,
judgment or other legal requirement.

 

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“Legal Proceeding” shall mean any legal, administrative or arbitral proceeding,
claim, suit, investigation, mediation, demand, informal inquiry, request for
documents or action.

“Lien” shall mean, with respect to any property or asset, any pledge, lien,
charge, mortgage, deed of trust, lease, sublease, license, restriction,
hypothecation, right of first refusal or offer, conditional sales or other title
retention agreement, adverse claim of ownership or use, easement, encroachment,
right of way or other title defect, encumbrance, option to purchase or lease or
otherwise acquire any interest, and security interest of any kind or nature
whatsoever.

“Limited Guaranty” shall mean that certain Limited Guaranty, dated as of
December 7, 2015 by the entities listed in Schedule A thereto as guarantors, in
favor of the Company.

“Material Adverse Effect” shall mean any condition, change, event, occurrence or
effect that, individually or in the aggregate with all other conditions,
changes, events, occurrences or effects, is or would reasonably be expected to
be (a) materially adverse to the business, assets, liabilities (contingent or
otherwise), results of operations or financial condition of the Company and the
Company Subsidiaries taken as a whole; other than any condition, change, event,
occurrence or effect, directly or indirectly, arising out of, resulting from or
relating to the following: (i) any condition, change, event, occurrence or
effect in any of the industries or markets in which the Company or any Company
Subsidiaries operates; (ii) any enactment of, change in, or change in
interpretation of, any Law or GAAP or governmental policy (it being understood
that this clause (ii) shall not apply with respect to a representation or
warranty contained in this Agreement to the extent that the purpose of such
representation or warranty is to address compliance with applicable Law or
GAAP); (iii) general economic, regulatory or political conditions (or changes
therein) or conditions (or changes therein) in the financial, credit or
securities markets (including changes in interest or currency exchange rates) in
any country or region in which the Company or any Company Subsidiaries conducts
business; (iv) any acts of God, natural disasters, terrorism, armed hostilities,
sabotage, war or any escalation or worsening of acts of terrorism, armed
hostilities or war; (v) the announcement, pendency of or performance of the
transactions contemplated hereby, including any legal, administrative or
arbitral proceeding, claim, suit, investigation, mediation, demand, informal
inquiry, request for documents or action in respect of this Agreement or any of
the transactions contemplated hereby or by reason of the identity of the
Investor or any communication by the Investor regarding the plans or intentions
of the Investor with respect to the conduct of the business of the Company or
any Company Subsidiaries and including the impact of any of the foregoing on any
relationships, contractual or otherwise, with customers, suppliers,
distributors, collaboration partners, employees or regulators (it being
understood that this clause (v) shall not apply with respect to the
representations and warranties set forth in Sections 4.4 and Section 4.7);
(vi) any action taken by the Company that is expressly required by the terms of
this Agreement or with the consent or at the direction of the Investor (it being
understood that this clause (vi) shall not apply with respect to the
representations and warranties set forth in Sections 4.4 and Section 4.7);
(vii) any decline in the market price, or change in trading volume, of the
capital stock of the Company (it being understood that the facts or occurrences
giving rise or contributing to such decline in market price or such change in
trading volume may be deemed to constitute, or be taken into account in
determining whether there has been, or would reasonably be expected to be, a
Material Adverse Effect); and (viii) any failure, in and of itself, by the
Company or any Company Subsidiaries to meet internal, analysts’ or other
earnings estimates or financial

 

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projections or forecasts for any period ending, or any changes in credit ratings
and any changes in any analysts recommendations or ratings with respect to the
Company or any Company Subsidiaries, on or after the date hereof (it being
understood that the facts or occurrences giving rise or contributing to such
failure may be deemed to constitute, or be taken into account in determining
whether there has been, or would reasonably be expected to be, a Material
Adverse Effect); (ix) any pending, initiated or threatened legal or
administrative proceeding, claim, suit or action against the Company, any
Company Subsidiaries or any of their respective officers or directors, in each
case, arising out of or relating to the execution of this Agreement or the
transactions contemplated hereby, and (x) any change in the relationship with
Ascension Health or any of its ministries to the extent, in each of clauses
(i) through (iv), that such condition, change, event, occurrence or effect does
not affect the Company and the Company Subsidiaries, taken as a whole, in a
disproportionate manner relative to other participants in the business and
industries in which the Company and the Company Subsidiaries operate; or
(b) prevent or materially impede, interfere with, hinder or delay the
consummation by the Company of the Transactions.

“MPSA” shall have the meaning set forth in Section 8.11.

“Notice Period” shall have the meaning set forth in Section 8.8(d).

“Ownership Percentage” means, as of any date, the percentage equal to (i) the
difference of (x) the aggregate number of shares of Common Stock issued or
issuable to the Investor pursuant to this Agreement or issued pursuant to any
preemptive rights pursuant to the Investor Rights Agreement (calculated assuming
the full exercise and conversion of the Preferred Shares, the shares of Series A
Preferred issued as PIK Dividends (as defined in the Series A Certificate of
Designations) or issuable as accrued and unpaid PIK Dividends not previously
added to the Liquidation Preference (as defined in the Series A Certificate of
Designations), in either case on or before such date, and the Warrant issued to
the Investor pursuant to this Agreement), minus (y) the aggregate number of any
shares of Common Stock (calculated assuming the full exercise and conversion of
such Preferred Shares, the shares of Series A Preferred issued as PIK Dividends
(as defined in the Series A Certificate of Designations) or issuable as accrued
and unpaid PIK Dividends not previously added to the Liquidation Preference (as
defined in the Series A Certificate of Designations), in either case on or
before such date, and the Warrant) transferred by the Investor to any Person
(including to the Company in connection with a redemption pursuant to the terms
of the Series A Certificate of Designations or Warrant Agreement, but excluding
any transfers to funds managed by TowerBrook Capital Partners L.P., Ascension or
their respective Affiliates in accordance with the Investor Rights Agreement)
divided by (ii) the total number of shares of Common Stock then outstanding
(calculated assuming the full exercise and conversion of the Preferred Shares,
the shares of Series A Preferred issued as PIK Dividends (as defined in the
Series A Certificate of Designations) or issuable as accrued and unpaid PIK
Dividends not previously added to the Liquidation Preference (as defined in the
Series A Certificate of Designations), in either case on or before such date,
and Warrant issued to the Investor pursuant to the Purchase Agreement).

“Person” shall mean an individual, corporation, limited liability company,
partnership, association, trust, unincorporated organization, joint venture,
other entity or group (as defined in the Exchange Act), including a Governmental
Authority.

 

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“Preferred Shares” shall have the meaning set forth in Section 2.

“Purchase Price” shall have the meaning set forth in Section 2.

“Registration Rights Agreement” shall have the meaning set forth in the recitals
of this Agreement.

“Representatives” shall mean, with respect to any Person, the advisors,
attorneys, accountants, consultants, agents or other representatives (acting in
such capacity) retained by such Person or any of its Affiliates, together with
directors, officers and employees of such Person and its Affiliates.

“Restraints” shall have the meaning set forth in Section 6.1.

“Restricted Stock” shall mean each share of Common Stock issued pursuant to any
Company Stock Plan or otherwise that is subject to specified vesting criteria.

“SEC” shall mean the U.S. Securities and Exchange Commission or any other U.S.
federal agency then administering the Securities Act or Exchange Act.

“SEC Reports” shall have the meaning set forth in Section 4.14.

“Securities” shall have the meaning set forth in Section 5.1.

“Securities Act” shall mean the U.S. Securities Act of 1933, and the rules and
regulations of the SEC thereunder.

“SEM Confidentiality Agreements” shall mean, collectively (i) the letter
agreement, dated October 5, 2015, between the Company and TowerBrook Capital
Partners L.P., (ii) the letter agreement, dated October 7, 2015, between Merrill
Lynch, Pierce Fenner & Smith Incorporated and the Company, (iii) the letter
agreement, dated October 5, 2015, between Deloitte & Touche LLP and the Company
and (iv) the letter agreement, dated October 12, 2015 between Manatt, Phelps &
Phillips, LLP and the Company, in each case, as may be amended from time to
time.

“Series A Certificate of Designations” shall have the meaning set forth in
Section 6.5.

“Series A Preferred” shall have the meaning set forth in the recitals of this
Agreement.

“Sherman Act” shall mean the Sherman Antitrust Act of 1890.

“Subcontractor” shall mean any Person that enters into a written arrangement
with the Company or any Subsidiary to provide services that to or on behalf of
the Company or any Subsidiary and for which the Company or any Subsidiary is
responsible in whole or in part under the Health Care Laws for its performance,
or the lack thereof, irrespective of whether that entity is otherwise subject to
the Health Care Laws.

 

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“Subsidiary” of any Person shall mean any corporation, partnership, joint
venture, limited liability company, trust or other form of legal entity of which
(or in which) more than 50% of (i) the issued and outstanding capital stock
having ordinary voting power to elect a majority of the board of directors of
such corporation (irrespective of whether at the time capital stock of any other
class or classes of such corporation shall or might have voting power upon the
occurrence of any contingency), (ii) the interest in the capital or profits of
such partnership, joint venture or limited liability company or (iii) the
beneficial interest in such trust or estate is at the time directly or
indirectly owned or controlled by such Person, by such Person and one or more of
its other Subsidiaries or by one or more of such Person’s other Subsidiaries.

“Subsidiary Charter Documents” shall mean the certificate of incorporation,
bylaws and other similar governing documents of each Company Subsidiary, in each
case as amended to the date of this Agreement.

“Superior Proposal” shall have the meaning set forth in Section 8.8(g).

“Takeover Proposal” shall have the meaning set forth in Section 8.8(f).

“Taxes” shall mean all federal, state, local or foreign taxes, charges, fees,
imposts, levies or other assessments, including all net income, gross receipts,
capital, sales, use, ad valorem, value added, transfer, franchise, profits,
inventory, capital stock, license, withholding, payroll, employment, social
security, unemployment, excise, severance, stamp, occupation, and property taxes
and all interest, penalties, fines, additions to tax or additional amounts
imposed by any Governmental Authority in connection with any of the foregoing.

“Term Sheet” shall have the meaning set forth in Section 8.11.

“Termination Fee” shall have the meaning set forth in Section 9.3(b).

“Transactions” shall mean the transactions contemplated by this Agreement, the
Investor Rights Agreement, the Registration Rights Agreement, the Warrant
Agreement and the MPSA.

“Warrant Agreement” shall have the meaning set forth in the recitals of this
Agreement.

“Warrant” shall have the meaning set forth in Section 2.

2. Purchase and Sale of the Preferred Shares; Warrant. On the terms and
conditions set forth in this Agreement, at the Closing, the Investor will
purchase from the Company, and the Company will issue, sell and deliver to the
Investor (i) 200,000 shares of Series A Preferred, at a purchase price of $1,000
per share, for an aggregate purchase price of $200,000,000 in cash (the
“Purchase Price”) to be paid in full to the Company on the Closing Date and
(ii) a warrant to acquire up to 60,000,000 shares of Common Stock on the terms
and subject to the conditions set forth in the Warrant Agreement. The shares of
Series A Preferred to be issued and sold by the Company to the Investor pursuant
to this Agreement are collectively referred to as the “Preferred Shares” and the
warrant to be issued by the Company to the Investor pursuant to the Warrant
Agreement are collectively referred to as the “Warrant.”

 

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3. Closing. The consummation of the purchase and sale of the Preferred Shares
and the other Transactions (the “Closing”) shall take place at the offices of
Kirkland & Ellis LLP, 601 Lexington Ave, New York, NY, 10022 at 10:00 a.m.
(local time), as soon as practicable, but no later than the date that is two
(2) Business Days following the satisfaction or waiver (to the extent permitted
by applicable Law) of the conditions set forth in Sections 6 and 7, or at such
other time and place as the Company and the Investor shall mutually agree in
writing (the “Closing Date”). At the Closing, the Company shall deliver to the
Investor certificates representing that number of Preferred Shares set forth in
Section 2 in exchange for payment of the Purchase Price by wire transfer of
immediately available funds to an account designated by the Company in advance
of the Closing Date.

4. Representations and Warranties of the Company. The Company represents and
warrants to the Investor that as of the date of this Agreement and as of the
Closing Date, except, other than with respect to the Fundamental Reps, (a) as
otherwise disclosed or incorporated by reference in any Filed SEC Reports filed
with the SEC prior to the date of this Agreement and (b) as set forth in the
disclosure letter dated as of the date of this Agreement provided to the
Investors separately, specifically identifying the relevant section of this
Agreement (provided, that disclosure in any section of such disclosure letter
shall apply to any section of this Agreement other than the Fundamental Reps to
the extent it is reasonably apparent on its face that such disclosure is
applicable to such section):

4.1 Organization, Good Standing and Qualification. Each of the Company and the
Company Subsidiaries is duly organized, validly existing and in good standing
under the laws of the state of its formation; has all requisite power and
authority to own its properties and conduct its business as presently conducted;
and is duly qualified to do business and in good standing in each state in the
United States of America where its business requires such qualification, except
where failure to be so duly organized, validly existing and in good standing, to
have such requisite power and authority or to be so duly qualified and in good
standing, individually or in the aggregate, has not had, or is not reasonably
likely to result in, a Material Adverse Effect. True and accurate copies of the
Company Charter Documents, each as in effect as of the date of this Agreement,
have been made available to the Investors.

4.2 Authorization; Enforceable Agreement.

(a) The Company has full right, power, authority and capacity to enter into this
Agreement, the Registration Rights Agreement, the Investor Rights Agreement and
the Warrant Agreement and to consummate the Transactions. All corporate action
on the part of the Company, its officers, directors, and shareholders necessary
for the authorization, execution, and delivery of this Agreement, the
Registration Rights Agreement, the Investor Rights Agreement and the Warrant
Agreement, the performance of all obligations of the Company under this
Agreement, the Registration Rights Agreement, the Investor Rights Agreement and
the Warrant Agreement, and the authorization, issuance (or reservation for
issuance), sale, and delivery of (i) the Preferred Shares being sold hereunder,
(ii) the Warrant, and (ii) the Common Stock issuable upon conversion of the
Series A Preferred in accordance with the terms of the Series A Certificate of
Designations or the exercise of the Warrant in accordance with the terms of the
Warrant Agreement has been, or will be, taken, and this Agreement, the
Registration

 

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Rights Agreement and the Warrant Agreement, when executed and delivered,
assuming due authorization, execution and delivery by the Investors, constitutes
and will constitute valid and legally binding obligations of the Company,
enforceable in accordance with their respective terms, subject to the filing of
the Series A Certificate of Designations with the Delaware Secretary of State
pursuant to Section 6.5.

(b) On or prior to the date of this Agreement, the Board has duly adopted
resolutions (i) evidencing its determination that as of the date of this
Agreement this Agreement and the Transactions are fair to and in the best
interests of the Company and its shareholders, (ii) approving this Agreement,
the Registration Rights Agreement, the Investor Rights Agreement, the Warrant
Agreement and the Transactions, (iii) declaring this Agreement and the issuance
and sale of the Preferred Shares and the Warrant advisable, and (iv) adopting
the Series A Certificate of Designations.

4.3 Litigation. There is neither any action, suit, proceeding or investigation
pending nor, to the Knowledge of the Company, overtly threatened against, nor
any outstanding judgment, order or decree against, the Company or any of the
Company Subsidiaries before or by any Governmental Authority or arbitral body
which, individually or in the aggregate, have had, or if adversely determined,
would reasonably be likely to result in, a Material Adverse Effect.

4.4 Governmental Consents. No consent, approval, order, or authorization of, or
registration, qualification, declaration, or filing with, any federal, state, or
local governmental authority on the part of the Company is required in
connection with the offer, sale, or issuance of the Preferred Shares or the
Warrant (and the Common Stock issuable upon conversion of the Preferred Shares
or exercise of the Warrant) or the consummation of any other transaction
contemplated by this Agreement, except for the following: (i) the filing of the
Series A Certificate of Designations with the Delaware Secretary of State
pursuant to Section 6.5; (ii) the compliance with other applicable state
securities laws, which compliance will have occurred within the appropriate time
periods; (iii) the filing with the SEC of such reports under the Exchange Act as
may be required in connection with this Agreement and the Transactions; and
(iv) filings required under, and compliance with other applicable requirements
of, the HSR Act. Assuming that the representations of the Investors set forth in
Section 5 are true and correct, the offer, sale, and issuance of the Preferred
Shares and Warrant in conformity with the terms of this Agreement are exempt
from the registration requirements of Section 5 of the Securities Act, and all
applicable state securities laws, and neither the Company nor any authorized
agent acting on its behalf will take any action hereafter that would cause the
loss of such exemptions.

4.5 Valid Issuance of Preferred and Common Stock and the Warrant. The Preferred
Shares being purchased by the Investor hereunder, when issued, sold, and
delivered in accordance with the terms of this Agreement for the consideration
expressed in this Agreement, will be duly and validly issued, fully paid, and
nonassessable, and will be free of any Liens or restrictions on transfer other
than restrictions under this Agreement, the Investor Rights Agreement and the
Series A Certificate of Designations and under applicable state and federal
securities laws. The Warrant when executed and delivered by the Company at the
Closing in accordance with the terms of this Agreement will be free of any Liens
or restrictions on transfer other than restrictions under this Agreement, the
Investor Rights Agreement and the Warrant.

 

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The Common Stock issuable upon conversion of the Series A Preferred or exercise
of the Warrant purchased under this Agreement has been duly and validly reserved
for issuance and, upon issuance in accordance with the terms of the Series A
Certificate of Designations, will be duly and validly issued, fully paid, and
nonassessable and will be free of any Liens or restrictions on transfer other
than restrictions on transfer under this Agreement and the Investor Rights
Agreement and under applicable state and federal securities Laws. The sale of
the Preferred Shares and the Warrant is not, and the subsequent conversion of
the Preferred Shares and exercise of the Warrant into Common Stock will not be,
subject to any preemptive rights, rights of first offer or any anti-dilution
provisions contained in the Company Charter Documents.

4.6 Capitalization. The authorized capital stock of the Company consists of
500,000,000 shares of Common Stock of which 108,673,951 were issued and
outstanding as of the close of business on December 2, 2015 (including 6,583,073
shares of Restricted Stock), and 5,000,000 shares of preferred stock, par value
$0.01, none of which is issued and outstanding (excluding the Preferred Shares
and the Warrant to be issued to the Investor pursuant to this Agreement). As of
the date hereof, 5,380,408 shares of Common Stock held by the Company in its
treasury. All issued and outstanding shares have been duly authorized and
validly issued, fully paid, nonassessable and free of preemptive rights. The
Company will reserve that number of shares of Common Stock sufficient for
issuance upon conversion of the Series A Preferred being issued and sold
pursuant to this Agreement and upon exercise of the Warrant pursuant to the
Warrant Agreement. As of the close of business on December 2, 2015, (x) options
to purchase an aggregate of 15,527,563 shares of Common Stock are outstanding
under the Company Stock Plans and (y) 5,131,713 shares of Restricted Stock are
outstanding under the Company Stock Plans. As of the close of business on
December 2, 2015, there are 9,173,663 shares of Company Common Stock reserved
for issuance under the Company Stock Plans. Other than as provided in this
Agreement, the Registration Rights Agreement, the Investor Rights Agreement and
the Warrant Agreement, there are no other outstanding rights, options, warrants,
preemptive rights, rights of first offer, or similar rights for the purchase or
acquisition from the Company of any securities of the Company, nor are there any
commitments to issue or execute any such rights, options, warrants, preemptive
rights or rights of first offer. Except as otherwise provided in the Series A
Certificate of Designations and the Warrant Agreement, there are no outstanding
rights or obligations of the Company to repurchase or redeem any of its equity
securities. The respective rights, preferences, privileges, and restrictions of
the Preferred Shares and the Common Stock are as stated in the Certificate of
Incorporation (including the Series A Certificate of Designations). From the
close of business on December 2, 2015 through and including the date of this
Agreement, there have been no issuances of Common Stock, Company preferred
stock, or options, warrants or other securities or rights convertible or
exchangeable into, or exercisable for, Common Stock or Company preferred stock
(other than issuances of Common Stock pursuant to the exercise of options
outstanding as of December 2, 2015 in accordance with the terms thereof).

4.7 Compliance with Other Instruments. The Company is not in violation or
default of any provision of the Company Charter Documents. The execution,
delivery, and performance of and compliance with this Agreement, the
Registration Rights Agreement, the Investor Rights Agreement and the Warrant
Agreement, and the issuance and sale of the Preferred Shares and the Warrant,
will not (i) result in any default or violation of the Company Charter
Documents, (ii) result in any default or violation of any agreement relating to
its Indebtedness or under any

 

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mortgage, deed of trust, security agreement or lease to which it is a party or
in any default or violation of any material judgment, order or decree of any
Governmental Authority or (iii) be in conflict with or constitute, with or
without the passage of time or giving of notice, a default under any such
provision, require any consent or waiver under any such provision, or result in
the creation of any mortgage, pledge, lien, encumbrance, or charge upon any of
the properties or assets of the Company pursuant to any such provision, or the
suspension, revocation, impairment or forfeiture of any permit, license,
authorization, or approval applicable to the Company, its business or
operations, or any of its assets or properties pursuant to any such provision,
except in the case of clauses (ii) and (iii) as, individually or in the
aggregate, has not had, or would not be reasonably likely to result in, a
Material Adverse Effect.

4.8 Material Adverse Effect. Neither the Company nor any Company Subsidiary has
sustained since the date of the latest audited financial statements included in
the Filed SEC Reports any material loss or interference with the business of the
Company and the Company Subsidiaries, taken as a whole, from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree; and, since the most
recent date as of which information is given in the Filed SEC Reports, there has
not been any change in the capital stock (other than as a result of the grant or
exercise of stock options or restricted stock pursuant to the Company Stock
Plans) or long-term debt of the Company or any of the Company Subsidiaries or
any Material Adverse Effect, or any development involving a prospective Material
Adverse Effect, in or affecting the general affairs, management, financial
position, stockholders’ equity or results of operations of the Company and the
Company Subsidiaries taken as a whole.

4.9 Properties; Assets. The Company and the Company Subsidiaries have good and
marketable title in fee simple to all real property and good and valid title to
all personal property owned by them, in each case free and clear of all Liens
except such as are described in the Filed SEC Reports or such as do not
materially affect the value of such property and do not materially interfere
with the use made and proposed to be made of such property by the Company and
the Company Subsidiaries; and any real property and buildings held under lease
by the Company and the Company Subsidiaries are held by them under valid,
subsisting and enforceable leases with such exceptions as are not material and
do not materially interfere with the use made and proposed to be made of such
property and buildings by the Company and the Company Subsidiaries.

4.10 Material Contracts. Neither the Company nor any of the Company Subsidiaries
is in violation or in default in the performance or observance of any material
obligation, agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, loan agreement, lease or other agreement or instrument
to which it is a party or by which it or any of its properties may be bound that
is required to be disclosed in the Filed SEC Reports (each, a “Company Material
Contract”).

4.11 Intellectual Property. The Company and the Company Subsidiaries own or have
the right to use pursuant to license, sublicense, agreement or permission all
patents, trademarks, service marks, patent applications, trade names,
copyrights, trade secrets, domain names, information, proprietary rights and
processes (“Intellectual Property”) necessary for their business as described in
the Filed SEC Reports and are necessary in connection with the products

 

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and services under development, without any conflict with or infringement of the
interests of others, except for such conflicts or infringements which,
individually or in the aggregate, have not had, or are not reasonably likely to
result in, a Material Adverse Effect, and have taken all reasonable steps
necessary to secure interests in such Intellectual Property and have taken all
reasonable steps necessary to secure assignment of such Intellectual Property
from its employees and contractors; the Company has no Knowledge of any
infringement by any third party of the trademark, trade name, patent, copyright,
license, trade secret, know-how, intellectual property or other similar rights
of the Company or any of the Company Subsidiaries which, individually or in the
aggregate, have had, or are reasonably likely to result in, a Material Adverse
Effect; except as set forth in the Filed SEC Reports, the Company is not aware
of outstanding options, licenses or agreements of any kind relating to the
Intellectual Property of the Company which are required to be set forth in the
Filed SEC Reports, and, except as set forth in the Filed SEC Reports, neither
the Company nor any of the Company Subsidiaries is a party to or bound by any
options, licenses or agreements with respect to the Intellectual Property of any
other Person which are required to be set forth in the Filed SEC Reports; none
of the technology employed by the Company has been obtained or is being used by
the Company or the Company Subsidiaries in violation of any contractual
fiduciary obligation binding on the Company or any of the Company Subsidiaries
or any of its directors or executive officers or, to the Company’s Knowledge,
any of its employees or otherwise in violation of the rights of any Persons;
neither the Company nor any of the Company Subsidiaries has received any written
or, to the Company’s Knowledge, oral communications alleging that the Company or
any of the Company Subsidiaries has violated, infringed or conflicted with, or,
by conducting its business as set forth in the Filed SEC Reports, would violate,
infringe or conflict with any of the Intellectual Property of any other Person
other than any such violations, infringements or conflicts which, individually
or in the aggregate, have not had, or are not reasonably likely to result in, a
Material Adverse Effect; and the Company and the Company Subsidiaries have taken
reasonable measures to prevent the unauthorized dissemination or publication of
their confidential information and, to the extent contractually required to do
so, the confidential information of third parties in their possession.

4.12 Internal Controls. The Company and the Company Subsidiaries maintain a
system of internal accounting control over financial reporting (as such term is
defined in Rule 12a-15(f) under the Exchange Act) that complies with the
Exchange Act and has been designed by the Company’s principal executive officer
and principal financial officer, or under their supervision, to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external reporting purposes in
accordance with GAAP. Since the end of the Company’s most recent audited fiscal
year, there has been (a) no material weakness in the Company’s internal control
over financial reporting (whether or not remediated) and (b) no change in the
Company’s internal control over financial reporting that has materially
adversely affected, or is reasonably likely to materially adversely affect, the
Company’s internal control over financial reporting.

4.13 Financial Statements; Controls.

(a) The financial statements and schedules of the Company, and the related notes
thereto, included in the Filed SEC Reports present fairly in all material
respects the consolidated financial position of the Company as of the respective
dates of such

 

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financial statements and schedules, and the consolidated results of operations
and cash flows of the Company for the respective periods covered thereby; such
statements, schedules and related notes have been prepared in accordance with
GAAP as certified by Ernst & Young LLP.

(b) The Company maintains disclosure controls and procedures (as such term is
defined in Rule 13a-15(e) under the Exchange Act) that comply with the
requirements of the Exchange Act; such disclosure controls and procedures have
been designed to ensure that material information relating to the Company and
the Company Subsidiaries is made known to the Company’s principal executive
officer and principal financial officer by others within those entities; and
such disclosure controls and procedures are effective.

(c) There are no contracts, other documents or other agreements required to be
described in the Filed SEC Reports or to be filed as exhibits to the Filed SEC
Reports by the Exchange Act or by the rules and regulations thereunder which
have not been described or filed (or incorporated by reference from prior
filings under the Exchange Act to the extent permitted) as required.

(d) The Company is in compliance with all provisions of the Sarbanes-Oxley Act
of 2002 and all rules and regulations promulgated thereunder or implementing the
provisions thereof that are in effect and with which the Company is required to
comply.

(e) The statements in the Company’s Annual Report on Form 10-K for the year
ended December 31, 2014 (the “2014 Annual Report”) under the captions: “Risk
Factors—Regulatory Risks” and “Business—Government Regulation,” insofar as such
statements describe the state, federal and foreign government or administrative
healthcare, debt collection and other laws, rules and regulations which are
applicable to the Company and the Company Subsidiaries, are complete and
accurate in all material respects; to the Knowledge of the Company there are no
applicable state, federal or administrative healthcare, debt collection or other
laws, rules and regulations which as of this date are material to the business
of the Company or any of the Company Subsidiaries, which are not described in
the 2014 Annual Report.

4.14 Exchange Act Reporting. The Company has filed or furnished, as applicable,
on a timely basis all forms, statements, certifications, reports and documents
required to be filed or furnished by it with the SEC pursuant to the Exchange
Act on or after January 1, 2014 (collectively, and in each case including all
exhibits and schedules thereto and documents incorporated by reference therein,
as such statements and reports may have been amended since the date of their
filing, the “SEC Reports”). Each of the SEC Reports complied or, if not yet
filed or furnished, will comply in all material respects with the applicable
requirements of the Exchange Act and any rules and regulations promulgated
thereunder. As of their respective dates (or, if amended prior to the date
hereof, as of the date of such amendment), the SEC Reports did not, and any SEC
Reports filed or furnished with the SEC subsequent to the date hereof will not,
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements made therein,
in light of the circumstances in which they were made, not misleading. As of the
date hereof, there are no material outstanding or unresolved comments received
from the SEC with respect to any of the SEC Reports.

 

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4.15 Compliance with Laws. The Company and the Company Subsidiaries (a) are in
compliance with, and conduct their respective businesses in conformity with, all
applicable foreign, federal, state and local laws and regulations, except where
the failure to so comply or conform has not had, or is not reasonably likely to
result in, a Material Adverse Effect and (b) possess all licenses, franchises,
permits, certificates, approvals, orders and authorizations from Governmental
Authorities required by Law necessary for the Company to conduct its business as
currently conducted or currently planned by the Company and the Company
Subsidiaries (each, a “Company Permit”), except where the failure to possess
such documents, individually or in the aggregate, has not had, or is not
reasonably likely to result in, a Material Adverse Effect; and neither the
Company nor any of the Company Subsidiaries has received any verbal or written
notice of any proceeding relating to the revocation or modification of, or
non-compliance with, any material certificate, authorization, permit, clearance
or approval.

4.16 Anti-Corruption Compliance. Neither the Company nor any of the Company
Subsidiaries nor, to the Company’s Knowledge, any affiliates, directors,
officers, employees, agents or Representatives of the Company or of any of the
Company Subsidiaries, has taken or will take any action in furtherance of an
offer, payment, promise to pay, or authorization or approval of the payment or
giving of money, property, gifts or anything else of value, directly or
indirectly, to any “government official” (including any officer or employee of a
government or government-owned or controlled entity or of a public international
organization, or any person acting in an official capacity for or on behalf of
any of the foregoing, or any political party or party official or candidate for
political office) to influence official action or secure an improper advantage;
and the Company and the Company Subsidiaries and affiliates have conducted their
businesses in compliance with applicable anti-corruption laws and have
instituted and maintain and will continue to maintain policies and procedures
designed to promote and achieve compliance with such laws and with the
representations and warranties contained herein.

4.17 Labor Matters.

(a) No labor dispute with the employees of the Company or any of the Company
Subsidiaries exists, or, to the Knowledge of the Company, is imminent, except
for any such dispute that has not had, or is not reasonably likely to result in,
a Material Adverse Effect, and the Company is not aware of any existing,
threatened or imminent labor disturbance by the employees of any of their
principal customers, suppliers, manufacturers or contractors that has had, or is
reasonably likely to result in, a Material Adverse Effect.

(b) The Company and the Company Subsidiaries are not subject to any liability as
a joint employer, single employer, co-employer or integrated enterprise with any
other employer, including any client to which the Company provides services,
which liability has had, or is reasonably likely to result in, a Material
Adverse Effect.

4.18 Insurance. The Company and each of the Company Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and risks
and in such amounts

 

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as are prudent and customary in the businesses in which they are engaged; and
neither the Company nor any of the Company Subsidiaries has any reason to
believe that it will not be able to renew its existing insurance coverage as and
when such coverage expires or to obtain similar coverage from similar insurers
as may be necessary to continue its business at a cost that would not be
reasonably likely to result in a Material Adverse Effect.

4.19 Related Party. There are no outstanding loans, advances (except normal
advances for business expenses in the ordinary course of business) or guarantees
or Indebtedness by the Company or any of the Company Subsidiaries to or for the
benefit of any of the executive officers or directors of the Company. Other than
as set forth in the definitive proxy statement on Schedule 14A for the 2015
annual meeting of the Company’s stockholders, no Person is or has been a party
to any transaction or proposed transaction with the Company or any Company
Subsidiary that would require disclosure in an SEC filing made by the Company
(if such filing were being made on the date hereof) pursuant to Item 404 of
Regulation S-K under the Exchange Act.

4.20 Brokers and Other Advisors. Except for Goldman, Sachs & Co. (the “Company
Financial Advisor”), no agent, broker, investment banker, finder, financial
advisor, firm or other Person is entitled to any broker’s, finder’s, financial
advisor’s or other similar fee or commission or reimbursement of expenses in
connection with the Transactions based upon arrangements made by or on behalf of
the Company or any Company Subsidiary. The Company has made available to the
Investor prior to the date hereof copies of all agreements pursuant to which the
Company Financial Advisor would be entitled to any payment relating to the
Transactions.

4.21 Health Care Matters.

(a) Since January 1, 2012, the Company and each Company Subsidiary has complied
in all respects with all Health Care Laws that are applicable to the business,
properties, assets and activities of the Company or any Company Subsidiary.

(b) None of the Company, any Company Subsidiary, any of their respective
officers, employees or agents, any Subcontractor or, to the Knowledge of the
Company, any officers, employees or agents of any Subcontractor has been
debarred, suspended or excluded under 21 U.S.C. Section 335a or any similar
laws, rules and regulations, ordinances, judgments, decrees, orders, writs and
injunctions of any Governmental Authority, or has been convicted of any crime or
engaged in any conduct that would reasonably be expected to result in a
debarment, suspension or exclusion under 21 U.S.C. Section 335a, or any similar
laws, rules and regulations, ordinances, judgments, decrees, orders, writs and
injunctions of any Governmental Authority. As of the date hereof, no Legal
Proceedings that would reasonably be expected to result in such a debarment or
exclusion are pending or, to the Knowledge of the Company, threatened against
the Company, any of the Company Subsidiaries, any of their respective officers,
employees or agents, any Subcontractor or, to the Knowledge of the Company, any
officers, employees or agents of any Subcontractor.

(c) None of the Company, any Company Subsidiary or, to the Knowledge of the
Company, any Subcontractor, officer or director of the Company or any Company
Subsidiary is now, or has been, subject to a corporate integrity or deferred
prosecution agreement with any Governmental Authority.

 

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(d) The Company has made available to the Investor complete and current copies
of all material compliance policies and procedures and privacy notices of the
Company relating to Information Laws.

(e) To the Knowledge of the Company, the Company has not received any notice or
other communication from any Governmental Authority challenging the processing
by the Company, any Company Subsidiary or any Subcontractor of billing and
coding services that such entity provides.

(f) The Company and the Company Subsidiaries have adopted and implemented
policies, procedures or programs reasonably designed to assure that their
respective directors, officers, employees, Subcontractors, vendors and similar
entities with which they do business are in compliance with all applicable
Health Care Laws, except to the extent that such failure does not currently
have, and would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect.

4.22 Vote Required. Assuming that the representations of the Investor set forth
in Section 5.8 are true and correct, no Company stockholder votes or consents
are necessary to authorize this Agreement or consummate the Transactions.

4.23 Anti-Takeover Provisions. Assuming that the representations of the Investor
set forth in Section 5.8 are true and correct, the approval of this Agreement by
the Board constitutes approval of this Agreement for purposes of any
“moratorium,” “control share acquisition,” “fair price,” “interested
shareholder,” “affiliate transaction,” “business combination” or other
antitakeover Laws, including Section 203 of the DGCL.

4.24 Section 16b-3. The Board has duly adopted resolutions to cause the
acquisition of the Preferred Shares and the Warrant by Investor hereunder to be
exempt from the liability provisions of Section 16(b) of the Exchange Act
pursuant to Rule 16b-3 promulgated thereunder.

5. Representations and Warranties of the Investor. The Investor represents and
warrants to the Company as of the date of this Agreement and as of the Closing
Date that:

5.1 Private Placement.

(a) The Investor is (i) an “accredited investor” within the meaning of Rule 501
of Regulation D promulgated under the Securities Act; (ii) aware that the sale
of the Preferred Shares, the Common Stock issuable upon conversion of the Series
A Preferred being issued and sold pursuant to this Agreement, and the Warrant
issued pursuant to the Warrant Agreement (collectively, the “Securities”) to it
are being made in reliance on a private placement exemption from registration
under the Securities Act and (iii) acquiring the Securities for its own account.

(b) The Investor understands and agrees that the Securities are being offered in
a transaction not involving any public offering within the meaning of the
Securities

 

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Act, that such Securities have not been and, except as contemplated by the
Registration Rights Agreement, will not be registered under the Securities Act
and that such Securities may be offered, resold, pledged or otherwise
transferred only (i) in a transaction not involving a public offering,
(ii) pursuant to an exemption from registration under the Securities Act
provided by Rule 144 thereunder (if available), (iii) pursuant to an effective
registration statement under the Securities Act or (iv) to the Company or one of
the Company Subsidiaries, in each of cases (i) through (iv) in accordance with
any applicable state and federal securities laws, and that it will notify any
subsequent purchaser of Securities from it of the resale restrictions referred
to above, as applicable.

(c) The Investor understands that, unless sold pursuant to a registration
statement that has been declared effective under the Securities Act or in
compliance with Rule 144 thereunder, the Company may require that the Securities
bear a legend or other restriction substantially to the following effect (it
being agreed that if the Securities are not certificated, other appropriate
restrictions shall be implemented to give effect to the following):

“THIS SECURITY WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, (THE “SECURITIES
ACT”), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. THE
HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS
SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) IN A
TRANSACTION NOT INVOLVING A PUBLIC OFFERING, (II) PURSUANT TO ANY OTHER
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, INCLUDING
RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), (III) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR (IV) TO THE COMPANY OR ANY
COMPANY SUBSIDIARY, IN EACH OF CASES (I) THROUGH (IV) IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER
WILL NOTIFY ANY SUBSEQUENT PURCHASER OF THIS SECURITY FROM IT OF THE RESALE
RESTRICTIONS REFERRED TO IN (A) ABOVE. THIS SECURITY MAY ONLY BE TRANSFERRED IN
ACCORDANCE WITH THE TERMS OF THE INVESTOR RIGHTS AGREEMENT, DATED AS OF [●],
2015, AMONG ACCRETIVE HEALTH, INC. AND THE INVESTOR NAMED THEREIN.”

(d) The Investor: (i) is able to fend for itself in the Transactions; (ii) has
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of its prospective investment in the
Securities; and (iii) has the ability to bear the economic risks of its
prospective investment and can afford the complete loss of such investment.

(e) The Investor acknowledges that (i) it has conducted its own investigation of
the Company and the terms of the Securities, (ii) it has had access to the
Company’s

 

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public filings with the SEC and to such financial and other information as it
deems necessary to make its decision to purchase the Securities and (iii) has
been offered the opportunity to conduct such review and analysis of the
business, assets, condition, operations and prospects of the Company and the
Company Subsidiaries and to ask questions of the Company and received answers
thereto, each as it deemed necessary in connection with the decision to purchase
the Securities. The Investor further acknowledges that it has had such
opportunity to consult with its own counsel, financial and tax advisors and
other professional advisers as it believes is sufficient for purposes of the
purchase of the Securities. The foregoing, however, does not limit or modify the
representations and warranties of the Company in Section 4 of this Agreement or
the right of the Investor to rely on such representations and warranties.

(f) The Investor understands that the Company will rely upon the truth and
accuracy of the foregoing representations, acknowledgements and agreements.

(g) Except for the representations and warranties contained in Section 4 of this
Agreement (including any references in such Section to the SEC Reports), such
Investor acknowledges that neither the Company nor any Person on behalf of the
Company makes, and the Investor has not relied upon, any other express or
implied representation or warranty with respect to the Company or any Company
Subsidiaries or with respect to any other information provided to the Investor
in connection with the Transactions.

5.2 Organization. The Investor is duly organized and is validly existing in the
jurisdiction of its organization.

5.3 Governmental Consents. No consent, approval, order, or authorization of, or
registration, qualification, declaration, or filing with, any federal, state, or
local governmental authority on the part of such Investor is required in
connection with the purchase of the Preferred Shares (and the Common Stock
issuable upon conversion of the Preferred Shares) or the consummation of any
other Transaction, except for the following: (i) the compliance with applicable
state securities laws, which compliance will have occurred within the
appropriate time periods; (ii) the filing with the SEC of such reports under the
Exchange Act as may be required in connection with this Agreement and the
Transactions; and (iii) filings required under, and compliance with other
applicable requirements of, the HSR Act.

5.4 Authorization; Enforceability. The Investor has full right, power, authority
and capacity to enter into this Agreement, the Registration Rights Agreement,
the Investor Rights Agreement and the Warrant Agreement and to consummate the
Transactions. The execution, delivery and performance of this Agreement, the
Registration Rights Agreement, the Investor Rights Agreement and the Warrant
Agreement have been duly authorized by all necessary action on the part of the
Investor, and this Agreement has been, and each of the Registration Rights
Agreement, the Investor Rights Agreement and the Warrant Agreement will at or
prior to the Closing be, duly executed and delivered by the Investor and,
assuming due authorization, execution and delivery of this Agreement, the
Registration Rights Agreement, the Investor Rights Agreement and the Warrant
Agreement by the Company, will constitute valid and binding obligation of the
Investor, enforceable against it in accordance with its terms.

 

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5.5 No Default or Violation. The execution, delivery, and performance of and
compliance with this Agreement, the Registration Rights Agreement, the Investor
Rights Agreement and the Warrant Agreement, and the purchase and receipt of the
Preferred Shares and the Warrant will not (i) result in any default or violation
of the certificate of incorporation, bylaws, limited partnership agreement,
limited liability company operating agreement or other applicable organizational
documents of the Investor, (ii) result in any default or violation of any
agreement relating to its material Indebtedness or under any mortgage, deed of
trust, security agreement or lease to which it is a party or in any default or
violation of any material judgment, order or decree of any Governmental
Authority or (iii) be in conflict with or constitute, with or without the
passage of time or giving of notice, a default under any such provision, require
any consent or waiver under any such provision, or result in the creation of any
Lien upon any of the properties or assets of the Investor pursuant to any such
provision, or the suspension, revocation, impairment or forfeiture of any
material permit, license, authorization, or approval applicable to the Investor,
its business or operations, or any of its assets or properties pursuant to any
such provision, except in the case of clauses (ii) and (iii) as would not,
individually or in the aggregate, reasonably be expected to prevent or
materially delay or materially impair the ability of the Investor to consummate
the Transactions.

5.6 Financial Capability. The Investor will have at the Closing the funds
necessary to purchase the Preferred Shares at Closing on the terms and
conditions contemplated by this Agreement.

5.7 Equity Financing. The Investor has delivered to the Company a true, correct
and complete copy, as of the date of this Agreement, of an executed commitment
letter dated as of the date of this Agreement (the “Equity Funding Letter”) from
the Equity Investors to invest, subject to the terms and conditions therein,
cash in the aggregate amount set forth therein in the Investor (the “Equity
Financing”). As of the date of this Agreement, the Equity Funding Letter has not
been amended or modified, no such amendment or modification is contemplated and
the commitments contained therein have not been withdrawn or rescinded in any
respect. As of the date of this Agreement, the Equity Funding Letter, in the
form so delivered, is in full force and effect and is a legal, valid and binding
obligation of the Investor, enforceable in accordance with their terms, and, to
the knowledge of the Investor, the other parties thereto, except that such
enforceability (a) may be limited by bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and other similar laws of general
application affecting or relating to the enforcement of creditors’ rights
generally and (b) is subject to general principles of equity, whether considered
in a proceeding at law or in equity. The Company is not obligated to pay any
commitment fees or other fees in connection with the Equity Funding Letter that
are payable on or prior to the date of this Agreement. The net proceeds
contemplated by the Equity Financing will, together with cash and cash
equivalents available to the Investor, be sufficient to pay the Purchase Price
upon the terms contemplated by this Agreement. As of the date of this Agreement,
the Investor has no reason to believe that it will be unable to satisfy any term
or condition of closing to be satisfied by it contained in the Equity Funding
Letter. As of the date of this Agreement, no event has occurred which, with or
without notice, lapse of time or both, would constitute a default or breach on
the part of the Investor under any term or condition of the Equity Funding
Letter or that would, individually or in the aggregate, permit the Equity
Investors to terminate, or to not make the initial funding of the facilities to
be established thereunder upon satisfaction of all conditions thereto. Except as
set forth in the Equity Funding Letter, there are no (i) conditions

 

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precedent to the respective obligations of the Equity Investors to fund the full
amount of the Equity Financing; or (ii) contractual contingencies under any
agreements, side letters or arrangements relating to the Equity Financing to
which either the Investor or any of its Affiliates is a party that would permit
the Equity Investors to reduce the total amount of the Equity Financing, or that
would materially and adversely affect the availability of the Equity Financing.
The Equity Funding Letter provides, and will continue to provide, that the
Company is a third party beneficiary thereof in accordance with the terms and
conditions of the Equity Funding Letter as of the date of this Agreement. The
Investor acknowledges and agrees that its obligations hereunder are not subject
to any conditions regarding the Investor’s or any other Person’s ability to
obtain financing for the consummation of the Transactions.

5.8 Interested Stockholder. Neither the Investor nor any of its “affiliates” or
“associates” is, nor at any time during the three (3) years prior to (and
including) the date of this Agreement has been, an “interested stockholder” of
the Company (as such terms in quotations are used in Section 203 of the DGCL).

6. Conditions to the Investor’s Obligations at Closing. The obligation of the
Investor to purchase the Preferred Shares and the Warrant at the Closing is
subject to the fulfillment or waiver (if permissible by applicable Law) on or
before the Closing of each of the following conditions:

6.1 No Law, injunction, judgment or ruling enacted, promulgated, issued,
entered, amended or enforced by any Governmental Authority (collectively,
“Restraints”) shall be in effect enjoining, restraining, preventing or
prohibiting consummation of the Transactions.

6.2 The representations and warranties of the Company set forth in this
Agreement, disregarding all qualifications and exceptions contained therein
relating to materiality or Material Adverse Effect, shall be true and correct as
of the date of this Agreement and as of the Closing Date with the same effect as
though made on and as of the Closing Date (except to the extent that such
representation and warranty expressly speaks only as of an earlier date, in
which case such representation and warranty shall be true and correct as of such
earlier date), except where the failure to be true and correct would not have a
Material Adverse Effect; provided, however, that, notwithstanding the foregoing,
each of the Fundamental Reps (other than the representations and warranties set
forth in Section 4.21) shall be true and correct in all material respects as of
the date of this Agreement and as of the Closing Date as though made at and as
of the Closing Date, and the Investor shall have received a certificate signed
on behalf of the Company by an executive officer of the Company to such effect.

6.3 The Company shall have performed in all material respects all obligations,
agreements and covenants required to be performed by it under this Agreement at
or prior to the Closing Date, and the Investor shall have received a certificate
signed on behalf of the Company by an executive officer of the Company to such
effect.

6.4 Since the date of this Agreement, there shall not have been any occurrence,
event, change, effect or development that would have, or would reasonably be
expected to have, a Material Adverse Effect.

 

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6.5 Prior to, or simultaneous with, the Closing, the Company shall have adopted
and filed with the Secretary of State of the State of Delaware a Certificate of
Designations of the Series A Preferred in the form attached as Exhibit D (the
“Series A Certificate of Designations”).

6.6 The Company shall have executed and delivered the Registration Rights
Agreement, the Investor Rights Agreement and the Warrant Agreement, in the forms
attached as exhibits hereto, with such revisions or amendments to the Investor
Rights Agreement as may be required pursuant to the rules, requirements or
requests of any Exchange.

6.7 Simultaneous with the Closing, the Company shall have executed and delivered
the MPSA incorporating the terms set forth in the Term Sheet.

6.8 Simultaneous with the Closing, the Company shall have paid to the Investor a
funding fee equal to $4,000,000, representing 2% of the Purchase Price.

6.9 Simultaneous with the Closing, the Company shall have reimbursed the
Investor for their reasonable documented out-of-pocket fees and expenses
incurred by the Investors, TowerBrook Capital Partners L.P., Ascension and their
respective Affiliates on or before the Closing Date in connection with the
evaluation, negotiation and execution of this Agreement, the Investor Rights
Agreement, the Registration Rights Agreement and the Warrant Agreement and the
purchase by the Investor of the Preferred Shares pursuant to this Agreement and
other potential transactions with the Company, provided that the Company’s
reimbursement obligation under this Section 6.9 shall be capped at $10,000,000.

6.10 All waiting periods (and any extensions thereof) applicable to the
Transactions under the HSR Act shall have been terminated or shall have expired.

6.11 Section 2.1(a) of the Investor Rights Agreement shall have been implemented
effective as of the Closing, and in connection therewith the Board shall be
comprised, simultaneously with, or immediately following, the Closing, of the
individuals set forth on Schedule 1 to the Investor Rights Agreement to the
extent such individuals are available, eligible and willing to serve.

7. Conditions to the Company’s Obligations at Closing. The obligations of the
Company to issue, sell and deliver to the Investor the Preferred Shares and the
Warrant at the Closing are subject to the fulfillment or waiver (if permissible
by applicable Law) on or before the Closing of each of the following conditions:

7.1 The Investor shall have paid to the Company the Purchase Price.

7.2 No Restraint shall be in effect enjoining, restraining, preventing or
prohibiting consummation of Transactions.

7.3 The representations and warranties of the Investor set forth in this
Agreement, disregarding all qualifications and exceptions contained therein
relating to materiality, shall be true and correct as of the date of this
Agreement and as of the Closing Date with the same effect as though made on and
as of the Closing Date (except to the extent that such representation and
warranty expressly speaks as of an earlier date, in which case such
representation and warranty

 

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shall be true and correct as of such earlier date), except where the failure to
be true and correct would not, individually or in the aggregate, reasonably be
expected to prevent or materially impede, interfere with, hinder or delay the
consummation by the Investor of the Transactions.

7.4 The Investor shall have performed in all material respects all obligations,
agreements and covenants required to be performed by it under this Agreement at
or prior to the Closing Date, and the Company shall have received a certificate
signed on behalf of the Investor by an executive officer of the Investor to such
effect.

7.5 The Investor shall have executed and delivered the Registration Rights
Agreement, the Investor Rights Agreement (including an executed confidentiality
agreement substantially in the form of Exhibit A thereto) and the Warrant
Agreement, in the forms attached as exhibits hereto, with such revisions or
amendments thereto as may be required pursuant to the rules of any Exchange.

7.6 Simultaneously with Closing, Ascension Health shall have executed and
delivered the MPSA incorporating the terms set forth in the Term Sheet.

7.7 All waiting periods (and any extensions thereof) applicable to the
Transactions under the HSR Act shall have been terminated or shall have expired.

8. Covenants. The Company and the Investor, as applicable, hereby covenant and
agree, for the benefit of the other party to this Agreement and the other
party’s respective assigns, as follows:

8.1 Use of Proceeds. The Company shall apply the net proceeds from the issuance
and sale of the Preferred Shares and the Warrant for general corporate purposes,
including funding working capital, the repayment of indebtedness and the payment
of fees and expenses in connection with the Transactions.

8.2 Reservation of Common Stock; Issuance of Shares of Common Stock. For as long
as any of the Preferred Shares or the Warrant remain outstanding, the Company
shall at all times reserve and keep available, free from preemptive rights, out
of its authorized but unissued Common Stock or shares of Common Stock held in
treasury by the Company, for the purpose of effecting the conversion of the
Preferred Shares or the exercise of the Warrant, the full number of shares of
Common Stock then issuable upon the conversion of all Preferred Shares and the
Warrant (after giving effect to all anti-dilution adjustments) then outstanding.
All shares of Common Stock delivered upon conversion or repurchase of the
Preferred Shares and the exercise of the Warrant shall be newly issued shares or
shares held in treasury by the Company, shall have been duly authorized and
validly issued and shall be fully paid and nonassessable, and shall be free from
preemptive rights and free of any Lien or adverse claim.

8.3 Transfer Taxes. The Company shall pay any and all documentary, stamp or
similar issue or transfer Tax due on (x) the issue of the Preferred Shares and
the Warrant at Closing and (y) the issue of shares of Common Stock upon
conversion of the Preferred Shares or exercise of the Warrant. However, in the
case of conversion of Preferred Shares or exercise of the Warrant, the Company
shall not be required to pay any Tax that may be payable in respect of any
transfer involved in the issue and delivery of shares of Common Stock in a name
other than

 

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that of the holder of the Preferred Shares to be converted or the Warrant to be
exercised, and no such issue or delivery shall be made unless and until the
Person requesting such issue has paid to the Company the amount of any such Tax,
or has established to the satisfaction of the Company that such Tax has been
paid.

8.4 Public Disclosure. On the date of this Agreement, or within 24 hours
thereafter, the Company shall issue a press release in a form mutually agreed to
by the Company and the Investor. No other written release, public announcement
or filing concerning the purchase of the Preferred Shares and the other
Transactions shall be issued, filed or furnished, as the case may be, by any
party without the prior written consent of the other party (which consent shall
not be unreasonably withheld, conditioned or delayed), except as such release,
announcement or filing as may be required by Law or the rules or regulations of
any securities exchange, in which case the party required to make the release or
announcement shall, to the extent reasonably practicable, allow the other party
reasonable time to comment on such release or announcement in advance of such
issuance. The provisions of this Section 8.4 shall not restrict the ability of a
party to summarize or describe the Transactions in any SEC Report so long as the
other party is provided a reasonable opportunity to review such disclosure in
advance.

8.5 Tax Related Covenants. Absent a change in Law or Internal Revenue Service
practice or a contrary determination (as defined in Section 1313(a) of the Code)
the Investor and the Company agree not to treat the Preferred Shares as
“preferred stock” within the meaning of Section 305 of the Code and Treasury
Regulation Section 1.305 -5 for United States federal income Tax reporting and
withholding Tax purposes and shall not take any Tax position inconsistent with
such treatment.

8.6 Further Assurances. Each of the Investor and the Company will cooperate and
consult with each other and use commercially reasonable efforts to prepare and
file all necessary documentation, to effect all necessary applications, notices,
petitions, filings and other documents, and to obtain all necessary permits,
consents, orders, approvals and authorizations of, or any exemption by, all
third Persons required to consummate the Transactions.

8.7 Antitrust Matters.

(a) Subject to the terms and conditions of this Agreement, each of the Company
and the Investor shall use its respective reasonable best efforts to take, or
cause to be taken, all actions and to do, or cause to be done, and cooperate
with the other parties in doing, all things necessary, proper and advisable
under applicable Law to cause the Transactions to be consummated as soon as
practicable, including to (i) prepare and make as promptly as practicable any
required submissions and filings with any Governmental Authority or third party
(including under applicable Antitrust Laws or any other applicable Laws) with
respect to the Transactions, (ii) as promptly as practicable, furnish
information required in connection with such submissions and filing, (iii) keep
the other parties reasonably informed with respect to the status of any such
submissions and filings, including with respect to: (A) the receipt of any
non-action, action, clearance, consent, approval, waiver, registration, permit,
authorization, license, franchise, permit, exemption, certificate or other
confirmation (collectively, “Authorizations”), (B) the expiration of any waiting
period, (C) the commencement or proposed or threatened

 

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commencement of any investigation, litigation or administrative or judicial
action or proceeding, or (D) the nature and status of any objections raised or
proposed or threatened to be raised with respect to the Transactions, and
(iv) promptly obtain and maintain all Authorizations from, and promptly deliver
all required notices to, any Governmental Authority or third party necessary,
proper or advisable to consummate the Transactions as soon as practicable
without giving rise to any violation, breach, loss of any benefit under,
conflict with the provisions of, or default (or event which, with the giving of
notice or passage of time, would constitute a default) under, termination or
modification of, or right of termination or modification of, or the creation of
any Lien on any asset of the Company or any Company Subsidiaries, pursuant to
any contract to which the Company or any Company Subsidiaries is a party or by
which the Company or any Company Subsidiaries is bound (with the understanding
and agreement that obtaining such Authorizations is not a condition under
Section 6 or 7 unless expressly provided therein). The Company and the Investor
agree that they will consult with each other with respect to obtaining all
necessary Authorizations and in connection therewith (subject to Section 8.4)
(x) the Company shall have the right to review and approve in advance all
characterizations of the information relating to the Company and the Company
Subsidiaries, (y) the Investor shall have the right to review and approve in
advance all characterizations of the information relating to the Investor, the
Equity Investors and their respective Affiliates and (z) each of the Company and
the Investor shall have the right to review and approve in advance all
characterizations of the information relating to the Transactions, in each case,
which appear in any material filing made in connection with the Transactions.
For purposes hereof, “Antitrust Laws” means the Sherman Act, the Clayton Act,
the HSR Act, the Federal Trade Commission Act, and all applicable foreign
antitrust Laws and all other applicable Laws issued by a Governmental Authority
that are designed or intended to prohibit, restrict or regulate actions having
the purpose or effect of monopolization or restraint of trade or lessening of
competition through merger or acquisition.

(b) In furtherance and not in limitation of the foregoing: (i) each of the
Company and the Investor agrees to (A) make an appropriate filing of a
Notification and Report Form pursuant to the HSR Act with respect to the
Transactions as soon as practicable, and in any event within ten (10) Business
Days after the date hereof (unless the parties otherwise agree to a different
date), (B) supply as soon as practicable any additional information and
documentary material that may be requested pursuant to the HSR Act or any other
applicable Antitrust Laws and (C) use its reasonable best efforts to take, or
cause to be taken, all other actions consistent with this Section 8.7(b)
necessary to cause the expiration or termination of the applicable waiting
periods under the HSR Act (including any extensions thereof) as soon as
practicable and (ii) each of the Company and the Investor agrees to (A) make the
appropriate filings under any foreign antitrust Laws as soon as practicable, and
in any event within ten (10) Business Days after the date hereof (unless the
parties otherwise agree to a different date), (B) supply as soon as practical
any additional information and documentary material that may be required or
requested by any Governmental Authority under such Antitrust Laws and (C) use
its reasonable best efforts to take or cause to be taken all other actions
consistent with this Section 8.7(b) as necessary to obtain any necessary
Authorizations from each such Governmental Authority as soon as practicable.

 

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(c) The Company and the Investor shall: (i) promptly notify the other parties
hereto of, and if in writing, furnish the others with copies of (or, in the case
of oral communications, advise the others of the contents of) any communication
received from, or given to, any Governmental Authority or third party with
respect to the Transactions, (ii) subject to applicable Law and Section 8.4,
permit the others to review and discuss in advance (and to consider in good
faith any comments made by the others in relation to) any proposed written
communication by it to any Governmental Authority or third party with respect to
the Transactions, (iii) keep the others informed of any developments, meetings
or discussions with any Governmental Authority in respect of any filings,
investigation or inquiry concerning the Transactions, and (iv) not independently
participate in any meeting or discussions with a Governmental Authority in
respect of any filings, investigation or inquiry concerning the Transactions
without giving the other party prior notice of such meeting or discussions and,
unless prohibited by such Governmental Authority, the opportunity to attend or
participate and (v) furnish the other parties with copies of all correspondence,
filings and written communications between them and their Affiliates and their
respective Representatives, on the one hand, and any such Governmental Authority
or its staff, on the other hand, with respect to the Transactions. However, each
of the Investor and the Company may designate any non-public information
provided to any Governmental Authority as restricted to “Outside Antitrust
Counsel” only and any such information shall not be shared with employees,
officers or directors or their equivalents of the other party without approval
of the party providing the non-public information.

(d) Notwithstanding the foregoing or any other provision of this Agreement,
(i) nothing in this Section 8.7 shall limit any applicable rights a party may
have to terminate this Agreement pursuant to Section 9.1 so long as such party
has up to then complied in all material respects with its obligations under this
Section 8.7.

8.8 No Solicitation.

(a) The Company and the Company Subsidiaries and their respective officers,
directors and employees shall, and the Company and the Company Subsidiaries
shall use their reasonable best efforts to cause their other Representatives, to
immediately cease all existing discussions or negotiations with any Person
conducted heretofore with respect to any Takeover Proposal or any proposal
reasonably expected to lead to any Takeover Proposal and shall promptly request
the return from, or destruction by, all such Persons of all copies of non-public
information previously furnished or made available to such Persons by or on
behalf of the Company in accordance with the terms of any confidentiality or
similar agreement in place with such Person. The Company and the Company
Subsidiaries and their respective officers, directors and employees shall,
except as otherwise provided in this Agreement, from the date of this Agreement
until the earlier of the Closing and the date, if any, on which this Agreement
is terminated pursuant to Section 9.1, not, and shall use their reasonable best
efforts to cause their other Representatives not to, directly or indirectly
(i) solicit, initiate, knowingly encourage or knowingly facilitate any
(including by way of furnishing or providing access to the non-public
information), or take any action which is reasonably expected to lead to, a
Takeover Proposal; (ii) enter into or participate in any discussions (except to
notify such

 

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Person of the existence of the provisions of this Section 8.8 without more) or
negotiations with any Person regarding any Takeover Proposal; (iii) approve any
transaction under, or any Person (other than the Investor) becoming an
“interested stockholder” under, Section 203 of the DGCL (except for any
transaction involving the Investor or any of its Affiliates); or (iv) enter into
any merger agreement, agreement in principle, letter of intent, or other similar
agreement providing for any Takeover Proposal (other than a confidentiality
agreement contemplated by Section 8.8(b)). Without limiting the foregoing, it is
agreed that any violation of the restrictions on the Company set forth in this
Section 8.8 by any officer or director of the Company (or any other
Representative of the Company that is authorized, intentionally sanctioned or
intentionally caused by the Company) shall be deemed a breach of this
Section 8.8 by the Company.

(b) Notwithstanding anything to the contrary contained in this Agreement, if at
any time prior to the Closing, the Company or any Company Subsidiary, or any of
its respective Representatives receives a bona fide written Takeover Proposal
made after the date hereof which did not result from a breach of this
Section 8.8, the Company, the Board (or a duly authorized committee thereof) and
their Representatives may engage in negotiations and discussions with, or
furnish any information and other access to, any Person making such Takeover
Proposal and any of its Representatives or potential sources of financing if the
Board (or a duly authorized committee thereof) determines in good faith, after
consultation with the Company’s outside legal and financial advisors, that such
Takeover Proposal is or could reasonably be expected to lead to a Superior
Proposal; provided that prior to furnishing any material non-public information
to any such Person, the Company receives from the Person making such Takeover
Proposal an Acceptable Confidentiality Agreement. The Company will promptly
notify the Investor in writing of the receipt of such Takeover Proposal and
communicate the material terms of such Takeover Proposal to the Investor. The
Company will keep the Investor reasonably apprised of the status of such
Takeover Proposal upon request (but in any event upon a change in the price or
any material terms thereof); provided, that the Company provides the Investor
any information with respect to the Company that could reasonably be expected to
be material to the Investor, furnished to such other Person which was not
previously furnished or made available to the Investor prior to, or concurrently
with, the time it is provided to such other Person. In addition to the other
obligations of the Company set forth in this Section 8.8, the Company will
reasonably promptly provide notice to the Investor in writing (and in any case
within forty-eight (48) hours of knowledge of receipt) of the receipt of such
Takeover Proposal. The Company shall keep the Investor reasonably informed on a
reasonably current basis of all material developments affecting the status of
and terms of such Takeover Proposal or request or any material changes to the
material terms thereof and of the status of any such discussions or
negotiations.

(c) Except as expressly permitted by this Agreement, neither the Board, nor any
committee thereof shall (i) adopt, approve, recommend or declare advisable, or
publicly propose to adopt, approve, recommend or declare advisable, any Takeover
Proposal or (ii) approve or recommend, or propose publicly to approve or
recommend, or cause to authorize the Company or any Company Subsidiaries to
enter into, any merger agreement, agreement in principle, letter of intent, or
other similar agreement providing for any Takeover Proposal (other than an
Acceptable Confidentiality Agreement entered into pursuant to Section 8.8(b)).

 

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(d) Notwithstanding anything to the contrary in this Agreement, the Board may
terminate this Agreement pursuant to Section 9.1(d), if (i) the Board (or a duly
authorized committee thereof) has received a Superior Proposal and determines in
good faith, after consultation with its outside legal counsel, that the failure
to take such action would reasonably be expected to be inconsistent with its
fiduciary duties under applicable Law and (ii) (A) the Company provides the
Investor prior written notice of its intent to terminate this Agreement pursuant
to Section 9.1(d) at least three (3) Business Days (the “Notice Period”) prior
to taking such action, to the effect that the Board (or a duly authorized
committee thereof) has received a Superior Proposal and the Board (or a duly
authorized committee thereof) has resolved to terminate this Agreement pursuant
to Section 9.1(d), which notice shall specify the basis for such termination and
attaches thereto the most current version or a reasonably detailed summary of
the material terms of such Superior Proposal (which version or summary shall be
updated on a prompt basis) (it being understood that any material revision or
amendment to the terms of such Superior Proposal, including any material
revision in price, shall require a new notice and, in such case, all references
to three (3) Business Days in this Section 8.8(d) shall be deemed to be one
(1) Business Day); (B) during the Notice Period, if requested by the Investor,
the Company shall and shall cause the Company Subsidiaries and its and their
respective Representatives to negotiate with the Investor’s Representatives in
good faith any proposed modifications to the terms and conditions of this
Agreement, if the Investor, in its sole discretion, proposes to make such
adjustments; (C) the Investor has not, within the Notice Period, made a written,
binding and irrevocable offer capable of being accepted by the Company to alter
the terms or conditions of this Agreement such that such Takeover Proposal would
cease to constitute a Superior Proposal and (D) the Board (or a duly authorized
committee thereof), after consulting with outside legal counsel and independent
financial advisors and taking into account any modifications to the terms of
this Agreement agreed to by the Investor after receipt of such notice, continues
to believe in good faith that such Takeover Proposal constitutes a Superior
Proposal.

(e) Nothing contained in this Agreement shall prohibit the Company or the Board
(or a duly authorized committee thereof) from (i) subject to Section 8.8(c)
(other than any “stop, look and listen” communication), making any disclosure to
the stockholders of the Company if the Board (or a duly authorized committee
thereof) determines in good faith, after consultation with its outside legal
counsel, that the failure to make such disclosure would be reasonably likely to
be inconsistent with applicable Law, (ii) informing any Person of the existence
of the provisions contained in this Section 8.8, (iii) waiving any standstill
provision of any confidentiality, standstill or similar agreement that would
prohibit a Person or group of Persons from communicating a Takeover Proposal to
the Company, the Board or any duly authorized committee thereof, or
(iv) following the receipt of a Takeover Proposal, contacting the Person or
group of Persons who has made such Takeover Proposal to clarify and understand
the terms and conditions thereof in accordance with Section 8.8(b).

 

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(f) As used in this Agreement, “Takeover Proposal” shall mean any bona fide
inquiry, proposal or offer from any Person or group (as defined in Section 13(d)
of the Exchange Act), other than the Investor and any of its Affiliates) to
(i) purchase or otherwise acquire, in a single transaction or series of related
transactions, of (A) assets of the Company or any Company Subsidiaries
(including securities of Company Subsidiaries) that account for 20% or more of
the Company’s consolidated assets or from which 20% or more of the Company’s
revenues or earnings on a consolidated basis are derived or (B) 20% or more of
the outstanding Common Stock or 20% of the equity securities of any Company
Subsidiary pursuant to a merger, consolidation or other business combination,
sale of shares of capital stock, tender offer, exchange offer or similar
transaction or (ii) a tender offer or exchange offer that if consummated would
result in any Person or “group” (as defined in Section 13(d) of the Exchange
Act) beneficially owning more than 20% of the outstanding Common Stock or 20% of
the equity securities of any Company Subsidiary or of any resulting parent
company of the Company, other than the Transactions.

(g) As used in this Agreement, “Superior Proposal” shall mean any bona fide,
written Takeover Proposal on terms which the Board (or a duly authorized
committee thereof) determines in good faith, after consultation with the
Company’s outside legal counsel and independent financial advisor be more
favorable to the holders of Common Stock than the Transactions, taking into
account to the extent applicable, the legal, financial, regulatory and other
factors (including all the terms and conditions of such Takeover Proposal and
this Agreement (including any changes to the terms of this Agreement proposed by
the Investor in accordance with Section 8.8(e)) that the Board considers
relevant; provided that for purposes of the definition of Superior Proposal, the
references to “20%” in the definition of Takeover Proposal shall be deemed to be
references to “50%.”

8.9 Conduct of Business. Except as expressly permitted or required by this
Agreement, as required by applicable Law, during the period from the date of
this Agreement until the earlier of (x) termination of this Agreement in
accordance with Section 9.1 and (y) the Closing, unless the Investor otherwise
consents in writing (which consent shall not be unreasonably withheld, delayed
or conditioned), the Company shall, and shall cause the Company Subsidiaries to,
conduct their businesses only in the ordinary course of business in all material
respects consistent with past practice. Without limiting the foregoing, except
as set forth in the Company disclosure letter dated as of the date of this
Agreement provided to the Investor, as expressly permitted or required by this
Agreement, as required by applicable Law or as consented to in writing by the
Investor (such consent not to be unreasonably withheld, conditioned or delayed),
the Company shall not, and shall not permit any of the Company Subsidiaries to,
between the date of this Agreement and the earlier to occur of the termination
of this Agreement in accordance with Section 9.1 and the Closing, take any of
the following actions:

(a) take any action that, if taken immediately following the Closing, would
require the approval of the holders of a majority of the Series A Preferred
Stock (on an as-converted basis, including any shares of Common Stock issued
upon the conversion thereof) that is held by the Investor or any Investor
Affiliate (as defined in the Investor Rights Agreement) pursuant to Section 2.4
of the Investor Rights Agreement;

 

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(b) (i) create, issue, sell or grant or authorize the issuance, sale or grant of
any equity securities of the Company or any of the Company Subsidiaries, except
for the issuance of shares of Common Stock required to be issued upon exercise
of Options that are outstanding on the date hereof in accordance with their
terms on the date hereof or (ii) amend any term of any equity securities of the
Company or any of the Company Subsidiaries (in each case, whether by merger,
consolidation or otherwise);

(c) make, or permit any Company Subsidiary to make, any loans, advances or
capital contributions to or investments in any other Person (other than a
wholly-owned Company Subsidiary domiciled in the United States);

(d) increase in any material respect the compensation of any of its directors or
senior executive officers (provided that payments of bonuses and other grants
and awards made in the ordinary course shall not constitute an increase in
compensation), except (i) as required pursuant to applicable Law or the terms of
Company Plans or Foreign Benefit Plans, or (ii) for bonuses and salary increases
in the ordinary course of business consistent with past practice;

(e) make or grant any bonus or any compensation or salary increase or severance
pay, termination pay or similar payment to any current employee or group of
current employees, except (i) as required pursuant to applicable Law or the
terms of Company Plans or Foreign Benefit Plans or other benefit or compensation
plans or arrangements in effect on the date of this Agreement, (ii) for bonuses
and salary increases in the ordinary course of business consistent with past
practice or (iii) the payment of 2015 annual bonuses based on actual performance
on or prior to December 31, 2015 consistent with the terms of the applicable
Company Plan to mitigate any issues resulting from the application of Sections
280G and 4999 of the Code and to maximize the net after-Tax proceeds received by
any individual subject to Section 4999 of the Code;

(f) enter into any Contracts of employment or any consulting or similar
agreement, except for agreements for newly hired employees or consultants in the
ordinary course of business consistent with past practice and with an annual
base salary not to exceed $250,000 for any such employee or consultant;

(g) (i) adopt, enter into, terminate or amend any Company Stock Plan except as
required by Law or (ii) grant or issue or accelerate the vesting of any awards
under any Company Stock Plan;

(h) terminate the employment of any individual who is party to an employment,
retention, severance or change in control agreement or arrangement, or take any
action or omit to take any action that would result in any such individual
having the right to resign for good reason (or a similar term of like meaning);

(i) settle or agree to settle, (i) any Legal Proceeding (except in the ordinary
course of business consistent with past practice), (ii) any stockholder
litigation or dispute

 

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against the Company or any of its officers or directors or (iii) any Legal
Proceeding that relates to the Transactions, in each case other than settlements
involving only the payment of money damages of less than $200,000 or that are
otherwise fully covered by insurance;

(j) amend or propose to amend the Company Charter Documents or the Subsidiary
Charter Documents;

(k) adopt a plan or agreement of complete or partial liquidation or dissolution
or resolutions providing for a complete or partial liquidation, dissolution,
restructuring, recapitalization or other reorganization of the Company or any
Company Subsidiary;

(l) (i) enter into, terminate or materially amend or modify (other than
extensions at the end of a term in the ordinary course) any Company Material
Contract or Contract that, if in effect on the date hereof, would have been a
Company Material Contract, or (ii) waive any material term of or any material
default under, or release, settle or compromise any material claim against the
Company or material liability or obligation owing to the Company, or any benefit
of the Company, under any Company Material Contract;

(m) amend or modify the letter of engagement of the Company Financial Advisor in
a manner that materially increases the fee or commission payable by the Company;

(n) take any action that would reasonably be expected to prevent or materially
impede, interfere with, hinder or delay the consummation of the Transactions; or

(o) agree, resolve or commit to take any of the foregoing actions.

8.10 Relisting. The Company shall use its reasonable best efforts to take, or
cause to be taken, all actions necessary to have the Common Stock (including all
shares of Common Stock issuable upon conversion of the Preferred Shares or
exercise of the Warrant) listed on any of the Nasdaq Global Select Market, the
Nasdaq Global Market, the Nasdaq Capital Market, The New York Stock Exchange or
any other United States national securities exchange (each, an “Exchange”), and
the Investor shall reasonably cooperate with the Company in connection with the
foregoing, including providing to the Company or the Exchange such information
reasonably requested by the Company that is necessary in connection therewith.

8.11 Master Professional Services Agreement. Each of the Company, the Investor
and Ascension Health shall use reasonable best efforts to negotiate and
(simultaneous with the Closing) execute an amended and restated Master
Professional Services Agreement by and between Ascension Health and the Company
(the “MPSA”) that incorporates the terms set forth in the term sheet, dated as
of the date hereof, by and between Ascension Health and the Company (the “Term
Sheet”) and such other terms as may be mutually agreed to by the Company, the
Investor and Ascension Health; provided that in the event of any failure between
or among the Company, the Investor and Ascension Health to mutually agree with
respect to any term not included in the Term Sheet, the MPSA shall follow the
applicable provision contained in the Master Professional Services Agreement by
and between Ascension Health and the Company in effect as of the date of this
Agreement.

 

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8.12 Transaction Litigation. The Company shall give the Investor the opportunity
to participate in (but not to control) the defense or settlement of any
stockholder litigation against the Company or any of its directors or officers
relating to this Agreement or the Transactions (and, in any event, no such
settlement of any stockholder litigation shall be agreed to without the
Investor’s prior written consent, such consent not to be unreasonably withheld,
conditioned or delayed). Each of the Investor and the Company shall notify the
other promptly (and in any event within 48 hours) of the commencement of any
such stockholder litigation of which it has received notice, and shall keep the
other reasonably informed regarding any such stockholder litigation.

8.13 Access to Information. Prior to the Closing, upon reasonable notice and
during normal business hours, the Company shall, and shall cause the officers
and employees of the Company, to (a) afford the officers, employees and
authorized agents and representatives of the Investor reasonable access to the
employees, offices, properties, books and records of the Company and (b) furnish
to the officers, employees and authorized agents and representatives of the
Investor such additional financial and operating data and other information
regarding the assets, properties and business of the Company as the Investor may
from time to time reasonably request in order to assist the Investor in
fulfilling its obligations under this Agreement and to facilitate the
consummation of the Transactions; provided, however, (i) any such access shall
be conducted in such a manner as not to interfere unreasonably with the
operations or business activities of the Company; and (ii) the Company shall not
be required to so confer, afford such access or furnish such copies or other
information to the extent that doing so would contravene any Law, result in the
breach of any confidentiality or similar agreement to which the Company is a
party, the loss of protectable interests in trade secrets, or the loss of
attorney-client privilege (provided that the Company shall use its reasonable
efforts to allow for such access or disclosure in a manner that does not result
in a breach of such agreement or a loss of attorney-client privilege, including
using commercially reasonable efforts to obtain the required consent of any
applicable third party or through the use of a “clean team”). The
representations, warranties, agreements, covenants and obligations of the
Company, and the rights and remedies that may be exercised by the Investor,
shall not be limited or otherwise affected by or as a result of any information
furnished to, or any investigation made by or knowledge of, the Investor or any
of its Representatives.

9. Termination.

9.1 Termination of Agreement Prior to Closing. This Agreement may be terminated
at any time prior to the Closing:

(a) by either the Investor or the Company if the Closing shall not have occurred
by the 90th calendar day following the date of this Agreement; provided,
however, that the right to terminate this Agreement under this Section 9.1 shall
not be available to any party whose failure to fulfill any obligation under this
Agreement shall have been the cause of, or shall have resulted in, the failure
of the Closing to occur on or prior to such date;

 

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(b) by either the Investor or the Company in the event that any Governmental
Authority shall have issued an order, decree or ruling or taken any other action
restraining, enjoining or otherwise prohibiting the Transactions and such order,
decree, ruling or other action shall have become final and nonappealable;

(c) by the mutual written consent of the Investor and the Company; or

(d) by the Company, in accordance with Section 8.8 to take a Superior Proposal;
provided that the Company promptly tenders payment of, or causes to be tendered,
the Termination Fee as provided in Section 9.3 (provided that the Investor shall
have provided wiring instructions for such payment or, if not, then such payment
shall be paid promptly, and in any event within two (2) Business Days, following
delivery of such instructions); it being understood that the Company may enter
into any transaction that is a Superior Proposal simultaneously with the
termination of this Agreement pursuant to this Section 9.1(d).

9.2 Effect of Termination Prior to Closing. In the event of termination of this
Agreement as provided in Section 9.1, this Agreement shall forthwith become void
and there shall be no liability on the part of any party hereto, except as
expressly set forth in Section 9.3; provided that nothing herein shall relieve
any party hereto from liability for any breach of any covenant of this
Agreement; and provided, further, that notwithstanding the foregoing, the terms
of Section 9.3, Section 10.1, Sections 10.2(b), (c) and (d), Section 10.7,
Section 10.9, Section 10.11 and this Section 9.2 shall remain in full force and
effect and shall survive any termination of this Agreement.

9.3 Termination Fee.

(a) In the event that this Agreement is terminated by the Company pursuant to
Section 9.1(d) the Company shall promptly tender or cause to be tendered as
directed by the Investor the Termination Fee substantially concurrently with the
termination of this Agreement.

(b) For purposes of this Agreement, “Termination Fee” shall mean an amount equal
to $8,000,000.

(c) Any amount that becomes payable pursuant to Section 9.3(a) shall be paid by
wire transfer of immediately available funds to an account designated by the
Investor and shall be reduced by any amounts required to be deducted or withheld
therefrom under applicable Law including in respect of Taxes.

10. Miscellaneous.

10.1 Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, without giving effect to any
choice or conflict of laws provision or rule (whether of the State of Delaware
or any other jurisdiction) that would cause the application of the Laws of any
jurisdiction other than the State of Delaware.

 

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10.2 Specific Enforcement; Jurisdiction.

(a) The parties agree that irreparable damage would occur and the parties would
not have any adequate remedy at law in the event that any of the provisions of
this Agreement were not performed in accordance with their specific terms or
were otherwise breached, except as provided in the following sentences. It is
accordingly agreed that (i) the parties shall be entitled to seek an injunction
or injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement from the Chancery Court of the State
of Delaware and any state appellate court therefrom within the State of Delaware
(or, if the Chancery Court of the State of Delaware declines to accept
jurisdiction over a particular matter, any state or federal court within the
State of Delaware), without proof of damages, without bond or other security
being required, this being in addition to any other remedy to which they are
entitled under this Agreement, at law or in equity, (ii) the provisions set
forth in this Section 10.2 (A) are not intended to and do not adequately
compensate for the harm that would result from a breach of this Agreement and
(B) shall not be construed to diminish or otherwise impair in any respect any
party’s right to specific enforcement, and (iii) the right of specific
enforcement is an integral part of the Transactions and without that right
neither the Company nor Investor would have entered into this Agreement.
Notwithstanding the foregoing, it is explicitly agreed that the Company shall
only be entitled to seek or obtain an injunction, specific performance or other
equitable remedies enforcing the Equity Funding Letter to cause the Equity
Financing to be funded at the Closing, enforcing Section 8.11 to cause the MPSA
to be executed and delivered by Ascension or otherwise causing the Closing to
occur, if all conditions (other than the condition set forth in Section 7.6) are
satisfied or waived and the Company has irrevocably confirmed in writing that if
the Equity Financing is funded and the MPSA is executed and delivered by
Ascension then it will take such actions that are required by it under this
Agreement to cause the Closing to occur. The parties hereto further agree that
(1) by seeking the remedies provided for in this Section 10.2(a), a party shall
not in any respect waive its right to seek any other form of relief that may be
available to a party under this Agreement (including monetary damages) in the
event that the remedies provided for in this Section 10.2(a) are not available
or otherwise are not granted, and (2) nothing set forth in this Section 10.2(a)
shall require any party hereto to institute any proceeding for (or limit any
party’s right to institute any proceeding for) specific performance under this
Section 10.2(a) prior or as a condition to exercising any termination right
under Section 9 (and pursuing damages after such termination), nor shall the
commencement of any legal proceeding pursuant to this Section 10.2(a) or
anything set forth in this Section 10.2(a) restrict or limit any party’s right
to terminate this Agreement in accordance with the terms of Section 9 or pursue
any other remedies under this Agreement that may be available then or
thereafter.

(b) Notwithstanding anything herein to the contrary, the maximum aggregate
liability of any party hereto for monetary damages or otherwise in connection
with this Agreement, the Equity Commitment Letter and the Transactions shall be
limited to $50,000,000. Except with respect to the Limited Guaranty to the
extent expressly provided therein, in no event shall any party hereto seek or
permit to be sought on behalf of such party any damages or any other recovery,
judgment or damages of any kind, including consequential, indirect, or punitive
damages, from any Affiliate of such party, or any Representative, member,
controlling Person or holder of any equity interests or

 

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securities of such party, or any of their respective Affiliates, in connection
with this Agreement or the Transactions. Each party hereto acknowledges and
agrees that it has no right of recovery against, and no personal liability shall
attach to, in each case with respect to damages, any Person (other than such
party to the extent provided in this Agreement), whether by or through attempted
piercing of the corporate, limited partnership or limited liability company
veil, by or through a claim by or on behalf of such party against any other
party thereto or any Affiliate thereof, by the enforcement of any assessment or
by any legal or equitable proceeding, by virtue of any statute, regulation or
applicable Law, or otherwise.

(c) The equitable remedies available to the parties hereto described in this
Section 10.2 shall be in addition to, and not in lieu of, any other remedies at
law or in equity that they may elect to pursue; provided, that while any party
hereto may concurrently pursue both (i) a grant of specific performance in
accordance with this Section 10.2 and (ii) money damages pursuant to this
Agreement, under no circumstances shall such party be permitted or entitled to
be awarded both a grant of specific performance and any money damages pursuant
to this Agreement.

(d) Each party hereto irrevocably agrees that any legal action or proceeding
arising out of or relating to this Agreement brought by any other party hereto
or its successors or assigns shall be brought and determined in the Chancery
Court of the State of Delaware and any state appellate court therefrom within
the State of Delaware (or, if the Chancery Court declines to accept jurisdiction
over a particular matter, in any state or federal court within the State of
Delaware), and each party hereby irrevocably submits to the exclusive
jurisdiction of the aforesaid courts for itself and with respect to its
property, generally and unconditionally, with regard to any such action or
proceeding arising out of or relating to this Agreement and the Transactions.
Each party agrees not to commence any action, suit or proceeding relating
thereto except in the courts described above in the State of Delaware, other
than actions in any court of competent jurisdiction to enforce any judgment,
decree or award rendered by any such court in the State of Delaware as described
herein. Each party irrevocably consents to the service of process outside the
territorial jurisdiction of the courts referred to in this Section 10.2 in any
such action or proceeding by mailing copies thereof by registered or certified
United States mail, postage prepaid, return receipt requested, to its address as
specified in or pursuant to Section 10.9. However, the foregoing shall not limit
the right of a party to effect service of process on the other party by any
other legally available method. EACH OF THE PARTIES HERETO IRREVOCABLY WAIVES
ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING BETWEEN THE PARTIES
HERETO ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS.

10.3 Survival. The representations and warranties in this Agreement shall expire
at the Closing and have no further force and effect, other than (a) in the event
of fraud, they shall survive indefinitely, and (b) the representations and
warranties set forth in Sections 4.2, 4.5, 4.6 and 4.21 (such representations
and warranties contained therein, the “Fundamental Reps”), which shall survive
until the third anniversary of the Closing Date. Notwithstanding the foregoing,
any claims asserted in writing by notice of a claim made in accordance with the
provisions hereunder and seeking to be indemnified within the time periods set
forth in this Section 10.3 shall survive until such claim is finally and fully
resolved.

 

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10.4 Indemnification.

(a) From and after the Closing, the Company shall defend, protect, indemnify and
hold harmless the Investor, its Affiliates and its and their respective
stockholders, partners, members, officers, directors, employees and agents
(collectively, the “Indemnitees”) from and against any and all actions, causes
of action, suits, claims, losses, costs, penalties, fees, liabilities and
damages, and expenses in connection therewith (irrespective of whether any such
Indemnitee is a party to the action for which indemnification hereunder is
sought), and including reasonable attorneys’ fees and disbursements (the
“Indemnified Liabilities”), (i) incurred by any Indemnitee as a result of, or
arising out of, or relating to any breach of any Fundamental Rep (other than
Section 4.21) (ii) incurred by any Indemnitee relating to any third party claim
brought against Indemnitee as a result of, or arising out of, or relating to any
breach of Section 4.21 or (iii) incurred by the Company or any Company
Subsidiary as a result of any fact, circumstance or matter giving rise to a
breach of Section 4.21 or the investigation, defense, adjudication or settlement
of any claim or investigation relating to any fact, circumstance or matter that
relates to alleged non-compliance with any Health Care Law to the extent such
non-compliance would be a breach of Section 4.21 (an “Indemnifiable Health Care
Matter”). To the extent that the foregoing undertaking by the Company may be
unenforceable for any reason, the Company shall make the maximum contribution to
the payment and satisfaction of each of the Indemnified Liabilities which is
permissible under applicable law. In the event of a claim for indemnification
pursuant to clause (iii) of the first sentence of this subsection (a), the
Indemnified Liabilities for which the Investor shall be entitled to
indemnification pursuant to Section 10.4(a) shall be, (A) if the Ownership
Percentage is equal to or greater than 50%, an amount equal to the aggregate
monetary and other out-of-pocket costs incurred by the Company and the Company
Subsidiaries in connection with the Indemnifiable Health Care Matter or (B) if
the Ownership Percentage is less than 50%, an amount equal to the Indemnity
Percentage multiplied by the aggregate monetary and other out-of-pocket costs
incurred by the Company and the Company Subsidiaries in connection with the
Indemnifiable Health Care Matter. The Company shall not be required to make
payments to, or on behalf of, the Indemnitees in respect of Indemnified
Liabilities under clauses (ii) and (iii) of the first sentence of this
Section 10.4(a) unless and until the aggregate payments to be made to, or on
behalf of, the Indemnitees in respect of such Indemnified Liabilities
(calculated, in the case of Indemnified Liabilities under clause (iii) of the
first sentence of this Section 10.4(a), in accordance with the immediately
preceding sentence) exceed $5,000,000 (the “Deductible”) and then only with
respect to such excess; provided that the Company shall not be required to make
payments to, or on behalf of, the Indemnitees in respect of such Indemnified
Liabilities in the aggregate in excess of $22,500,000 above the Deductible.

(b) If any action shall be brought against any Indemnitee in respect of which
indemnity may be sought pursuant to this Agreement, such Indemnitee shall notify
the Company in writing, and the Company shall have the right to assume the
defense thereof with counsel of its own choosing. Any Indemnitee shall have the
right to employ separate

 

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counsel in any such action and participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of such Indemnitee except
to the extent that: (i) the employment thereof has been specifically authorized
by the Company in writing; (ii) the Company has failed after a reasonable period
of time to assume such defense and to employ counsel; or (iii) in such action
there is, in the reasonable opinion of such separate counsel, a material
conflict on any material issue between the position of the Company and the
position of such Indemnitee. The Company will not be liable to any Indemnitee
under this Agreement for any settlement by an Indemnitee effected without the
Company’s prior written consent, which shall not be unreasonably withheld or
delayed.

(c) Following the Closing, the indemnification provided by Section 10.4(a) shall
be the sole and exclusive remedy for any loss, liability, demand, claim, action,
cause of action, cost, damage, deficiency, tax, penalty, fine or expense,
whether or not arising out of third party claims (including, without limitation,
interest, penalties, reasonable attorneys’ fees and expenses, court costs and
all reasonable amounts paid in investigation, defense or settlement of any of
the foregoing) of the Indemnitees with respect to any misrepresentation or
inaccuracy in, or breach of, any Fundamental Rep.

10.5 Successors and Assigns. Except as otherwise provided in this Agreement, the
provisions of this Agreement shall inure to the benefit of, and be binding upon,
the successors, assigns, heirs, executors, and administrators of the parties;
provided, however, that neither this Agreement nor any of the rights, interests
or obligations hereunder shall be assigned, in whole or in part, by operation of
Law or otherwise, by either of the parties without the prior written consent of
the other party, except that the Investor may transfer or assign its rights and
obligations under this Agreement, in whole or from time to time in part, to
(a) one or more of its Affiliates at any time and (b) after the Closing, to
Ascension Health, TowerBrook Capital Partners L.P. or any of their Affiliates in
connection with a transfer of the Series A Preferred or the Warrant.

10.6 No Third-Party Beneficiaries. Notwithstanding anything contained in this
Agreement to the contrary, nothing in this Agreement, expressed or implied, is
intended to confer on any Person other than the parties any rights, remedies,
obligations or liabilities under or by reason of this Agreement, and no Person
that is not a party to this Agreement (including any partner, member,
shareholder, director, officer, employee or other beneficial owner of any party,
in its own capacity as such or in bringing a derivative action on behalf of a
party) shall have any standing as third-party beneficiary with respect to this
Agreement or the transactions contemplated by this Agreement.

10.7 No Personal Liability of Directors, Officers, Owners, Etc. Except for the
Company’s ability to enforce this Agreement, the Equity Funding Letter and the
Limited Guaranty against the respective signatories thereto, no director,
officer, employee, incorporator, shareholder, managing member, member, general
partner, limited partner, principal or other agent of the Investor or the
Company shall have any liability for any obligations of the Investor or the
Company, as applicable, under this Agreement or for any claim based on, in
respect of, or by reason of, the respective obligations of the Investor or the
Company, as applicable, under this Agreement. Subject to Section 10.2, each
party hereby waives and releases all such liability. This waiver and release is
a material inducement to each party’s entry into this Agreement.

 

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10.8 Entire Agreement. This Agreement and the other documents delivered pursuant
to this Agreement, including the Registration Rights Agreement, the Investor
Rights Agreement and the Warrant Agreement, constitute the full and entire
understanding and agreement among the parties with regard to the subjects hereof
and thereof.

10.9 Notices. Except as otherwise provided in this Agreement, all notices,
requests, claims, demands, waivers and other communications required or
permitted under this Agreement shall be in writing and shall be mailed by
reliable overnight delivery service or delivered by hand, facsimile or messenger
as follows:

 

if to the Company:   

Accretive Health, Inc.

401 North Michigan Ave., Suite 2700

Chicago, IL 60611

Attention: General Counsel

Facsimile: 312-277-6690

with a copy to:   

Kirkland & Ellis LLP

300 N LaSalle

Chicago, IL 60654

Attention: Richard W. Porter, P.C.

                  Robert M. Hayward, P.C.

Facsimile: (312) 862-2200

if to the Investor:   

c/o TowerBrook Capital Partners L.P.

Park Avenue Tower

65 East 55th Street, 29th Floor

New York, NY 10022

Attention: Glenn Miller

Facsimile: 917-591-4789

with a copy to:   

Wachtell, Lipton, Rosen & Katz

51 West 52nd Street

New York, New York 10019

Attention: Steven A. Cohen

Facsimile: (212) 403-2347

 

Covington & Burling LLP

The New York Times Building

620 Eighth Avenue

New York, New York 10018

Attention: Stephen A. Infante

Facsimile: (646) 441-9039

 

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if to Ascension Health:   

Ascension Health Alliance d/b/a Ascension

101 S. Hanley Road, Suite 450

  

St. Louis, MO 63105

Attention: Joseph Impicciche, Executive Vice President & General Counsel

Facsimile: (314) 733-8261

with a copy to:   

Covington & Burling LLP

The New York Times Building

620 Eighth Avenue

New York, New York 10018

Attention: Stephen A. Infante

Facsimile: (646) 441-9039

or in any such case to such other address, facsimile number or telephone as
either party may, from time to time, designate in a written notice given in a
like manner. Notices shall be deemed given when actually delivered by overnight
delivery service, hand or messenger, or when received by facsimile if promptly
confirmed.

10.10 Delays or Omissions. No delay or omission to exercise any right, power, or
remedy accruing to any party under this Agreement shall impair any such right,
power, or remedy of such party, nor shall it be construed to be a waiver of or
acquiescence to any breach or default, or in any similar breach or default
thereafter occurring; nor shall any waiver of any single breach or default be
deemed a waiver of any other breach or default. All remedies, either under this
Agreement or by law or otherwise afforded to any holder, shall be cumulative and
not alternative.

10.11 Expenses. The Company and the Investor shall bear their own expenses and
legal fees incurred on their behalf with respect to this Agreement and the
Transactions, except as otherwise provided in Section 6.8.

10.12 Amendments and Waivers. Any term of this Agreement may be amended and the
observance of any term of this Agreement may be waived (either generally or in a
particular instance and either retroactively or prospectively), only if such
amendment or waiver is in writing and signed, in the case of an amendment, by
the Company and the Investor or, in the case of a waiver, by the party against
whom the waiver is to be effective; provided that Section 8.11 cannot be amended
or waived without the written consent of Ascension Health. Any amendment or
waiver effected in accordance with this paragraph shall be binding upon each
holder of any securities purchased under this Agreement at the time outstanding
(including securities into which such securities are convertible), each future
holder of all such securities, and the Company. Any consent hereunder and any
amendment or waiver of any term of this Agreement by the Company must be
approved in accordance with the Investor Rights Agreement.

10.13 Counterparts. This Agreement may be executed in any number of counterparts
and signatures may be delivered by facsimile or in electronic format, each of
which may be executed by less than all the parties, each of which shall be
enforceable against the parties actually executing such counterparts and all of
which together shall constitute one instrument.

 

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10.14 Severability. If any provision of this Agreement becomes or is declared by
a court of competent jurisdiction to be illegal, unenforceable, or void,
portions of such provision, or such provision in its entirety, to the extent
necessary, shall be severed from this Agreement and the balance of this
Agreement shall be enforceable in accordance with its terms.

10.15 Titles and Subtitles; Interpretation. The titles and subtitles used in
this Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement. When a reference is made in this
Agreement to an Article, Section, Schedule or Exhibit, such reference shall be
to an Article, Section, Schedule or Exhibit of this Agreement unless otherwise
indicated. Whenever the words “include,” “includes” or “including” are used in
this Agreement, they shall be deemed to be followed by the words “without
limitation.” The definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such term. Any agreement, instrument or
statute defined or referred to in this Agreement 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. Each
of the parties has participated in the drafting and negotiation of this
Agreement. If an ambiguity or question of intent or interpretation arises, this
Agreement shall be construed as if it is drafted by each of the parties, and no
presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of authorship of any of the provisions of this Agreement.

10.16 No Additional Representations. Except for the representations and
warranties contained in Section 4, the Investor acknowledges that neither the
Company nor any Person on behalf of the Company makes any other express or
implied representation or warranty with respect to the Company or any Company
Subsidiaries or with respect to any other information made available to the
Investor in connection with the Transactions. Neither the Company nor any other
Person will have or be subject to any liability or indemnification obligation to
the Investor or any other Person resulting from the distribution to the
Investor, or the Investor’s use of, any such information, including any
information, documents, projections, forecasts or other material made available
to the Investor in certain “data rooms” or management presentations in
expectation of the Transactions, unless and then only to the extent that any
such information is expressly included in a representation or warranty contained
in Section 4.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

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IN WITNESS WHEREOF, the parties have executed this Securities Purchase Agreement
as of the date first above written.

 

ACCRETIVE HEALTH, INC. By:  

/s/ Emad Rizk

Name:  

Emad Rizk

Title:  

Chief Executive Officer and President

 

[SIGNATURE PAGE CONTINUES]

SIGNATURE PAGE TO SECURITIES PURCHASE AGREEMENT

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TCP-ASC ACHI SERIES LLLP By:  

/s/ Glenn Miller

Name:  

Glenn Miller

Title:  

Attorney-in-Fact

 

SIGNATURE PAGE TO SECURITIES PURCHASE AGREEMENT

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ASCENSION HEALTH ALLIANCE D/B/A ASCENSION, solely for purposes of Sections 8.11,
9.2, 10.1, 10.2 and 10.5 through 10.15 By:  

/s/ Anthony J. Speranzo

Name:  

Anthony J. Speranzo

Title:  

Executive Vice President and Chief Financial Officer

 

SIGNATURE PAGE TO SECURITIES PURCHASE AGREEMENT

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EXHIBITS

 

Exhibit A Registration Rights Agreement*

 

Exhibit B Investor Rights Agreement*

 

Exhibit C Form of Warrant*

 

Exhibit D Series A Certificate of Designations*

 

* Filed separately as exhibits to this Current Report on Form 8-K