Exhibit 10.4
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

ADDENDUM NO. 2 TO

AMENDED AND RESTATED SERVICES AGREEMENT

BETWEEN

IHC Health Services, Inc.

AND

R1 RCM Inc.

--------------------------------------------------------------------------------

ADDENDUM NO. 2 TO
AMENDED AND RESTATED SERVICES AGREEMENT
This Addendum No. 2 (this “Addendum”) is made and entered into as of the 18th
day of June, 2018 (the “Addendum Effective Date”) by and between IHC Health
Services, Inc., a Utah non-profit corporation, (“IMH” or sometimes referred to
as “Intermountain” or “Intermountain Healthcare”) and R1 RCM Inc., a Delaware
corporation, formerly known as Accretive Health, Inc. (“R1”) (each a “Party” and
collectively, the “Parties”), pursuant to and subject to that certain Amended
and Restated Services Agreement (referred to herein as the "Services Agreement")
dated as of January 23, 2018, by and between the Parties. The Parties have also
entered into a Transition Services Agreement (referred to herein as the
“Transition Services Agreement”) dated April 8, 2018.

NOW THEREFORE, in consideration of the premises and mutual consents set forth
below, the Parties hereby agree as follows:

1.
Purpose

When signed by both Parties, this Addendum shall be attached to, and deemed a
part of, the Services Agreement. The Parties intend to supplement the Services
Agreement to add missing information and terms that the Parties specifically
intended to agree upon following the Effective Date of the Services Agreement.
All other terms and conditions of the Agreement shall remain in full force and
effect.
2.
Schedules and Attachments

This Addendum includes each of the following attached Exhibits, all of which are
incorporated into this Addendum by reference:
Exhibit A: Amended and Restated Exhibit 11.1-A
Exhibit B: R1 Leased Spaces at Intermountain Buildings
Exhibit C: Sample Calculation
 

3.
Definitions

Capitalized terms used in this Addendum but not otherwise defined herein shall
have the meanings given to such terms in the Services Agreement.

 
1
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

4.
Base Fee

4.1
Effective as of the Commencement Date, Exhibit 11.1-A (Base Fee for Services) to
the Services Agreement is hereby deleted and replaced in its entirety with
Exhibit A hereto.

4.2
In accordance with Section 2.2(ii) of Exhibit 11.1-A, the Parties have agreed on
a methodology relating to allocation of costs and expenses for information
technology support and real estate for purposes of the calculation of Base Fee.

Use of Lake Park Premises
4.3
Pursuant to a separate lease agreement between the Parties, Intermountain is
leasing to R1 certain floors and square footage located within the “north”
building, and may lease to R1 space within the “south” building, of 4646 Lake
Park Blvd. in Salt Lake City, Utah 84120 (together, the “Lake Park Premises”).
The base rent charged by Intermountain to R1 for use of the Lake Park Premises
as set forth in the lease agreement [**] is based on fair market rent for
similar space in the Salt Lake City region.

4.4
[**]

4.5
R1 will notify Intermountain (the “L.P. Services Notice”) promptly after R1
commences performing services at the Lake Park Premises for a client other than
Intermountain. [**]

4.6
Thereafter, on a quarterly basis, R1 will provide to Intermountain a report that
contains (a) the percentage of working space at the Lake Park Premises dedicated
solely to Intermountain and (b) the percentage of other space (i.e., “mixed” use
working space plus space dedicated solely to any non-Intermountain client) as of
such date. [**]

4.7
If at a future date, the Parties enter into a lease for 3930 Parkway Boulevard,
West Valley City, Utah 84120 (“Parkway”), the Parties agree that Sections 4.3 –
4.6 will apply to Parkway with the references to Lake Park Premises and [**]
interpreted to refer to the Parkway premises and base rent at the Parkway
premises.

Real Estate Baseline Costs
4.8
With respect to those Intermountain locations listed on Exhibit B that are
leased to R1 pursuant to sublease or license agreements (collectively, the
“Leased Spaces”), if there is a difference between (i) the total cost of
operations at the Leased Spaces, including, but not limited to, base rent,
furniture fees, utilities and operating expenses, and (ii) the baseline costs
and expenses associated with the Leased Spaces that were included in the Cost to
Collect Numerator for the Initial Cost to Collect Factor, then the Parties agree
to perform a one-time adjustment prior to September 30, 2018 to equitably
increase or decrease the Non-Labor Cost to Collect Factor to account for such
difference in

 
2
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

accordance with Section 2.2(ii) of Exhibit 11.1-A to the Services Agreement,
with such adjustment to be effective retroactively to the Commencement Date.
4.9
The Parties further agree to equitably decrease the Non-Labor Cost to Collect
Factor to remove baseline costs and expenses associated with closure of the
following short term leased spaces as identified in Exhibit B: (a) Med Group CBO
Springville, (b) Med Group CBO Riverdale, (c) Provo Eastbay CBO, (d) St. George
CBO (BE) & (FE), (e) St. George CBO (Med Group), and (f) St. George – Knight,
with such reduction to take effect as of the termination date of each such
sublease agreement or license agreement. The termination date for all short term
leases is anticipated to be September 1, 2018, but such date may be extended if
and as agreed by the Parties in writing. [**]

Information Technology Support
4.10
In consideration for R1’s access and use of [**], on a [**] basis, R1 will [**].

4.11
In consideration for the Transition Services (not covered by Section 4.10 above)
provided by Intermountain under the Transition Services Agreement between the
Parties, on a [**] basis, R1 will [**].

4.12
On a quarterly basis, R1 will provide to Intermountain a report that contains
(a) the number of R1 employees with [**] and (b) the number of R1 employees
located in premises who use, or for whom is used, any of the Transition Services
or IT infrastructure under the Transition Services Agreement, as of such date.
Upon Intermountain’s request in good faith, R1 will provide Intermountain with
information reasonably needed by Intermountain to calculate or verify the [**].

4.13
[**]

5.
Amendment to Exhibit 18.8

Effective as of the date of the Services Agreement, Exhibit 18.8 to the Services
Agreement is hereby amended by adding the following paragraph as Section 8:
“8.    R1 is not entitled to and shall not take any tax position that is
inconsistent with being a service provider to Intermountain Healthcare with
respect to property owned by Intermountain Healthcare. For example, R1 shall not
claim any depreciation or amortization deduction, investment tax credit, or
deduction for any payment as rent with respect to Intermountain Healthcare
property (except for payments of rent on the property leased, subleased or
licensed by R1 from IMH under the following agreements, all dated to be
effective as of April 8, 2018: (a) Office Lease Agreement for Lake Park North
building, (b) Office Lease Agreement for space in Layton building, (c) Office
Lease Agreement for space in South Jordan Homecare building, (d) Master License
Agreement for space in Provo Eastbay building, (e) Sublease Agreement for
Riverdale location, (f) Sublease Agreement for Springville location, (g)
Sublease

 
3
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Agreement for St. George – 340-342 E. 600 S. location, (h) Sublease Agreement
for St. George – Knight Bldg. location, and (i) Sublease Agreement for St.
George – Foremaster Bldg. location).”

SIGNATURE PAGE FOLLOWS

[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]

 
4
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the Parties have caused this Addendum to be executed by
their respective duly authorized representatives as of the Addendum Effective
Date.

IHC Health Services, Inc. 

By:   /s/ Mark A. Runyon                     
Name:   Mark A. Runyon                    
Title:   VP Operations Finance              
R1 RCM Inc. 

By:   /s/ H. Jeffrey Brownawell              
Name:   H. Jeffrey Brownawell              
Title:   SVP of Operations                       

SIGNATURE PAGE TO ADDENDUM __ TO AMENDED AND RESTATED SERVICES AGREEMENT

[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

EXHIBIT A
AMENDED AND RESTATED EXHIBIT 11.1-A

EXHIBIT A TO ADDENDUM 2 TO AMENDED AND RESTATED SERVICES AGREEMENT

[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

[R1 Draft 4-23-18]
Confidential Draft for Discussion Purposes Only

AMENDED AND RESTATED SERVICES AGREEMENT

between

IHC Health Services, Inc.

and

R1 RCM Inc.

EXHIBIT 11.1-A

BASE FEE FOR SERVICES

[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

Exhibit 11.1-A

Base Fee for Services
1.Base Fee.
For R1’s provision of Services, IMH will pay to R1 a single base fee with
respect to the combined IMH Facilities and the IMH Providers (the “Base Fee”),
which Base Fee shall be calculated in the aggregate and will be comprised of:
1.1
For the period from the Commencement Date through [**], a [**] fee (to be
invoiced in accordance with Exhibit 11.1-C) equal to the sum of:

a.
the product of:

(i)
the prior year’s [**] Cash Collections with respect to such [**] for the revenue
cycle operations of the IMH Facilities and the IMH Providers in the aggregate,

multiplied by
(ii)
the sum of (A) one, plus (B) [**] (the result of (i) multiplied by (ii) will be
referred to herein as “[**] Base Fee Cash”),

multiplied by
(iii)
the [**] Cost to Collect Factor,

plus
b.
the product of:

(i)
the prior year’s [**] Cash Collections with respect to such [**] for the revenue
cycle operations of the IMH Facilities and the IMH Providers in the aggregate,

multiplied by

 
1
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

(ii)
the sum of (A) one, plus (B) [**] plus (C) [**] (the result of (i) multiplied by
(ii) will be referred to herein as “[**] Base Fee Cash”,

multiplied by
(iii)
the [**] Cost to Collect Factor,

minus
c.
the product of:

(i)
the [**] Base Fee Cash,

multiplied by
(ii)
the [**] (as defined in Section 4.3),

minus
d.
the product of:

(i)
the prior year’s [**] Cash Collections with respect to such [**] for the revenue
cycle operations of the IMH Facilities and the IMH Providers in the aggregate,

multiplied by
(ii)
the [**] (as defined in Section 5).

1.2
For the period of [**] to [**], a [**] fee equal to (to be invoiced in
accordance with Exhibit 11.1-C) the sum of:

a.
the product of:

(i)
the [**] Base Fee Cash with respect to such quarter,

multiplied by
(ii)
the [**] Cost to Collect Factor,

plus
b.
the product of:

(i)
the [**] Base Fee Cash with respect to such [**]

 
2
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

multiplied by
(ii)
the [**] Cost to Collect Factor,

minus
c.
the product of:

(i)
the sum of (A) [**] (as defined in Section 4.3), plus (B) [**] (as defined in
Section 5),

multiplied by
(ii)
the [**] Base Fee Cash with respect to such quarter.

1.3
For all periods beginning on or following [**], a [**] fee equal to (to be
invoiced in accordance with Exhibit 11.1-C) the sum of:

a.
the product of:

(i)
the prior year’s [**] Base Fee Cash with respect to such quarter,

multiplied by
(ii)
the sum of (A) one, plus (B) [**] plus (C) [**]

multiplied by
(iii)
the [**] Cost to Collect Factor,

plus
b.
the product of:

(i)
the prior year’s [**] Base Fee Cash with respect to such quarter

multiplied by
(ii)
the sum of (A) one, plus (B) [**] plus (C) [**]

multiplied by
(iii)
the [**] Cost to Collect Factor

 
3
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

minus
c.
the product of:

(i)
the sum of (A) [**] (as defined in Section 4.3), plus (B) [**] (as defined in
Section 5),

multiplied by
(ii)
the [**] Base Fee Cash with respect to such [**].

It is the intent of the Parties to commence Services on the first day of any
month; however, in the event any Services do not start on the first of a month,
the Parties shall account for any proration in the Base Fee in accordance with
Section 11.5 of the Services Agreement.
1.4
Certain Definitions

(i)
“Acute Adjusted Admissions” means, for any Contract Quarter, the quotient of:
(x) Total Patient Revenue for such quarter, divided by (y) the quotient of (1)
Inpatient Revenue for such quarter, divided by (2) Inpatient Admissions for such
quarter.

(ii)
“Acute Adjusted Admissions Percentage Change” means, for any Contract Quarter,
the quotient of: (x) the difference between (a) the Acute Adjusted Admissions
for such Contract Quarter, minus (b) the Acute Adjusted Admissions for the prior
year’s Contract Quarter, divided by (y) the Acute Adjusted Admissions for the
prior year’s Contract Quarter.

For example, to calculate the Acute Adjusted Admissions Percentage Change for
the quarter ended 6/30/2019, you would evaluate the percentage change in the
Acute Adjusted Admissions from the three-month period ended February 2018 to the
three-month period ended February 2019.
(iii)
“Baseline Year” means [**].

(iv)
“Contract Quarter” means each three-month period during a Contract Year during
the Term (i.e., January 1st to March 31st, April 1st to June 30th, July 1st to
September 30th and October 1st to December 31st).

(v)
“Contract Year” means each calendar year during the Term, provided, however,
that the initial Contract Year shall be the truncated year starting on the
Commencement Date and ending on December 31, 2018.

 
4
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

(vi)
[**]

(vii)
“Inpatient Admissions” means, for any Contract Quarter, the total number of
Inpatient Admissions as set forth in IMH’s Enterprise Data Warehouse or
equivalent reporting system.

(viii)
“Inpatient Revenue” means, for any Contract Quarter, the total dollar value of
Inpatient Revenue as set forth in IMH’s Enterprise Data Warehouse or equivalent
reporting system.

(ix)
“[**] Cost to Collect Factor” means the Initial Cost to Collect Factor (as
defined in Section 3.1), minus the [**] Cost to Collect Factor.

(x)
“[**] Cost to Collect Factor” means the sum of: (i) the [**] Cost to Collect
Factor plus (ii) the [**] Cost to Collect Factor (as each is defined in Section
3.1)

(xi)
[**]

(xii)
“Provider Visits” means, for any Contract Quarter, the total number of Provider
Visits as set forth in IMH’s Enterprise Data Warehouse or equivalent reporting
system.

(xiii)
“[**] Cash Collections” means, for each of the IMH Facilities and the IMH
Providers (or both), the cumulative Cash Collections received by IMH for the IMH
Facilities or the IMH Providers (or in the aggregate with respect to both),
during the [**] period that ends one month prior to the commencement of the [**]
for which the Base Fee with respect to IMH is payable.

For example, to calculate the Base Fee for [**] ended 6/30/2018, the [**] Cash
Collections would equal IMH’s Cash Collections for the IMH Facilities and the
IMH Providers for [**].
(xiv)
[**]

2.Initial Assessment.
2.1
Performance and Timing. The Parties will perform and complete a collaborative
initial assessment of the Services prior to the Commencement Date in order to
determine the Initial Cost to Collect Factor (as defined in Section 3.1 below)
(the “Initial Assessment”).

2.2
Assessment Principles. In connection with the Initial Assessment, the following
principles will be followed.

 
5
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

(i)
Payroll Expenses for IMH: All payroll costs and expenses at IMH for In-Scope
Employees (defined below) and, to the extent not otherwise included in the
definition of In-Scope Employees, all payroll costs and expenses for Management
Employees (as defined in this Section 2.2), all of which shall be borne by R1.
“In-Scope Employees” means:

a.
those non-clinical employees, as identified by job title, which are responsible
for performing functions that relate to the Services which are designated,
pursuant to the Initial Assessment, as having an In-Scope Percentage (as defined
below) that is greater than or equal to [**] percent ([**]) (all of which
employees shall also be deemed to be In-Scope Employees); and

b.
if approved by the Joint Review Board, any non-clinical employees, as identified
by job title, that are responsible for performing functions that relate to the
Services and are designated, pursuant to the Initial Assessment as having an
In-Scope Percentage higher than [**] percent ([**]) but lower than [**] percent
([**]).

Notwithstanding the foregoing, (y) subsection b of this definition shall include
those employees working in departments which perform both the Services and
services not qualifying as the Services, and (z) IMH may remove any Management
Employee from the In-Scope Employees (in which case, R1 [**] for any payroll
costs and expenses relating to such Management Employees). For the avoidance of
doubt, if IMH removes an employee who is not a Management Employee from the
In-Scope Employees, then such employee will remain an IMH employee, but the Cost
to Collect Numerator will [**] with respect to any such employee. R1 shall [**]
relating to such employees for the period of time such employee remains an IMH
employee and provide services for IMH that would otherwise be Services under the
Agreement if such employee had transitioned to R1.
“In-Scope Percentage” shall mean, for any “Department” at IMH, the proportion of
“In Scope FTEs” cost for such Department divided by the “Total FTEs” cost for
such Department.
“Management Employee” shall mean any (i) [**], and (ii) any employees performing
similar functions to any of the employees referenced in clause (i).
(ii)
IT Support/Real Estate Expenses for IMH: With respect to allocation of costs and
expenses related to information technology support and real estate for

 
6
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

purposes of inclusion in the Cost to Collect Numerator, the Parties shall, prior
to the Commencement Date, mutually agree in good faith on a methodology that (A)
represents an accurate reflection of the allocation of costs and expenses
between the Parties including both operating expense and depreciation expense;
and (B) favors simplicity in execution and invoicing and excludes any cost
allocation for In-Scope Employees whom we reasonably expect to remain in
Authorized Space. The Parties shall mutually agree in good faith on a mechanism
to avoid a material amount of duplicate or unfunded costs or expenses related to
IT support and real estate.
(iii)
Other Expenses for IMH: Allocation of all other expense categories shall be
determined through mutual agreement of both Parties in good faith.

(iv)
[**]

(v)
Non-Payroll Expenses for Third-Party Vendors: The Cost to Collect Numerator, as
defined below, will include all costs and expenses related to In-Scope Vendors
(defined below), [**] shall [**], excluding any portion of the costs and
expenses for Partially Related Vendors that are not related to the Services.

“In-Scope Vendors” means third party vendors that perform functions as part of
or related to the Services, including: (A) any vendor that, provides a product,
solution or service (a “Vendor Service”) that is [**] percent ([**]) related to
the Services; and (B) any vendor that is, providing or offering a Vendor Service
is partially related to the Services (“Partially Related Vendors”).
In-Scope Vendors shall not include any (y) IT Host System Vendor; and (z) vendor
with respect to a Vendor Service that is not related to the Services in any
manner. “IT Host System Vendor” means a third party vendor that provides a
product, solution or service (including hosting or providing a platform or
system) that is used to capture patient encounters and associated charges that
result in generation of a patient statement or bill.
(vi)
Partially Related Vendors: For any Partially Related Vendors, the portion of the
cost of the Partially Related Vendor that relates to the Services will be [**].
The Joint Review Board may review the list of vendors from time to time and,
when appropriate, determine whether any such vendor is not an In-Scope Vendor.
If a vendor is deemed not to be an In-Scope Vendor, an adjustment to the Cost to
Collect Numerator shall be made to [**], and R1 shall [**].

 
7
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

(vii)
Additional Considerations:

a.
If a termination fee or other termination-related costs or expenses must be paid
to allow for the termination or any splitting of an existing In-Scope Vendor
contract, such fee will be [**], subject to Section 14.6 of the Agreement.

b.
The allocation of one-time, lump-sum implementation and/or license fees for a
particular In-Scope Vendor will be [**] the Cost to Collect Numerator.

c.
R1 and IMH shall each be responsible for its own incurred costs associated with
information technology, such as interface development, file transfers, and
custom programming related to the R1 technology solutions and other third party
vendors.

d.
The allocation between the Parties of one-time costs related to information
technology system conversion services, including consulting services, staff
augmentation and training, will be excluded from the Cost to Collect Numerator.

e.
Recurring maintenance, support, service, license, or contingency fees for all
In-Scope Vendor products, solutions, and services, shall be included in the Cost
to Collect Numerator, and [**] R1.

f.
The Parties will work together to identify any costs from the Initial Assessment
that should be either added or removed from the Cost to Collect Numerator.

2.3
Determination of Initial Cost to Collect Factor. The Initial Cost to Collect
Factor shall be determined by the Joint Review Board after the completion of the
Initial Assessment.

(i)
Calculation Principles. In addition to the principles listed in Section 2.2
above, the Joint Review Board shall also follow the methodology below with
respect to completing the table set forth in Section 3.1 in order to establish
the Initial Cost to Collect Factor:

a.
The fraction to be set forth in the table (expressed as a percentage)
representing the Cost to Collect Factor as of the Effective Date will be
calculated as follows: (i) the aggregated annual value of all costs from the
Initial Assessment for IMH, as approved by the Joint Review Board, and otherwise
normalized to account for any extraordinary

 
8
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

costs that do not relate to the Services provided during the Baseline Year or
are not reasonably expected to continue (e.g. payroll costs related to
Transcription) (collectively, “Cost to Collect Numerator”); and (ii) the
denominator is equal to the aggregate amount of Cash Collections for the IMH
Facilities and the IMH Providers, in the aggregate, during the Baseline Year.
(ii)
The Parties must determine the Initial Cost to Collect Factor prior to the
Commencement Date.

3.Cost to Collect Factor.
3.1
“Cost to Collect Factor” means the fraction (expressed as a percentage) approved
by the Joint Review Board after completion of the Initial Assessment (such
fraction subject to any adjustment agreed by the Joint Review Board in
accordance with Sections 3.2 and 3.3 below).

 
Baseline Year Cash
Cost to Collect Numerator
Initial Cost to Collect Factor
All IMH Facilities and IMH Providers
[**]
[**]
[**]

[**]
The Cost to Collect Factor in the first table above shall be referred to as the
“Initial Cost to Collect Factor.”
For the avoidance of doubt, the applicable Cost to Collect Factor that will be
used in the Base Fee calculation in Section 1.1 shall equal the sum of:
(i)
the Initial Cost to Collect Factor listed above,

(ii)
any downward adjustments, as provided for in Section 3.2 below, and

(iii)
any upward adjustments, as provided for in Section 3.3 below.

For purposes of clarity, the Parties agree that the adjustments contemplated by
subsections (ii) and (iii) directly above shall only be effective to Base Fee
calculations prospectively, as of the latter to occur of: (x) the date of
approval of the adjustment by the Joint Review Board; and (y) any later date as
set forth in the approval by the Joint Review Board.
3.2
Discontinued Services

 
9
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

If any Service is approved to be discontinued by the Joint Review Board, or via
a written amendment to the Services Agreement executed by the Parties, the
Parties will conduct an assessment of the cost assumptions underlying the Cost
to Collect Factor with respect to such Service and the Joint Review Board shall
approve an equitable downward adjustment to the Cost to Collect Factor to
account for such Discontinued Services.
3.3
New Services, Acquisitions and New Hospitals

(i)
For the avoidance of doubt, if IMH requests that R1 provide any services other
than the Services or if IMH requests that R1 provide any Services which were not
provided to IMH prior to the date of such request, all such requested services
shall be New Services under Section 3.8 of the Services Agreement. The Parties
agree that for any such New Services, if the costs or expenses associated with
such New Service are not accounted for in the determination of the Cost to
Collect Factor as of the date such New Service would commence, then the Cost to
Collect Factor will be equitably increased by an amount to be determined by the
Joint Review Board, and such adjustments shall be effective as of the date R1
begins performing such New Service.

(ii)
In the event that after the Commencement Date additional existing facilities and
providers are added to the IMH Facilities or IMH Providers that result in an
increase of [**] of net patient services revenue, the Parties will perform and
complete an assessment of such facilities and providers that is consistent in
scope with the Initial Assessment and follows the principles set forth in
Section 2.2. The results of any such assessment shall be submitted to the Joint
Review Board and the Joint Review Board shall determine the proper increase to
the Cost to Collect Factor in accordance with the guidelines and principles of
this Exhibit 11.1-A. If the additional facilities and providers result in an
increase of [**] of net patient services revenue the Cost to Collect factor then
in place will be applied to the new facilities and providers.

(iii)
In the event that after the Commencement Date IMH opens new facilities that are
added to the IMH Facilities or IMH Providers, and R1 hires any employees who
will perform the Services for such new facility more than [**] in advance of IMH
opening a new facility at IMH’s request, IMH shall reimburse R1 for the expenses
incurred for hiring each such employee.

Any adjustments made for discontinuation of Services under Section 3.2 or
addition of New Services under Section 3.3(i) will be based on the following
fraction – the annualized expense for such Services divided by the trailing
twelve months Cash Collections for the IMH Facilities and the IMH Providers –
which fraction will be added or removed from the then current Cost to Collect
Factor, depending on whether Services are being added or removed.

 
10
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

4.[**]
4.1
During the Term, Intermountain shall be entitled to a [**] on each [**] Base Fee
invoice, as reflected in Section 1.1, of the applicable [**] (as defined below),
which shall be phased in over the [**] period from the Commencement Date.

4.2
For each year that Intermountain receives Services from R1 during the Term, the
Cost to Collect Factor shall be [**] to be calculated as follows:

(i)
For the period starting on the Commencement Date and ending [**], [**] of the
[**] shall be [**] from the Cost to Collect Factor;

(ii)
For the [**], [**] of the [**] shall be [**] from the Cost to Collect Factor;

(iii)
For each subsequent calendar year during the term thereafter, [**] of the [**]
shall be [**] from the Cost to Collect Factor.

4.3
“[**]” means the quotient (expressed as a percentage) of (x) [**] divided by (y)
the aggregate Cash Collections of the IMH Facilities and the IMH Providers
during the Baseline Year.

Period
[**]
[**]
Commencement Date – [**]
[**]
[**]
[**]
[**]
[**]
[**] – Term
[**]
[**]

5.[**]
[**]
Period
[**]
Commencement Date – [**]
   [**]
[**]
[**]
[**]
[**]
[**] – Term
[**]

[**]
6.Windfall Situations and Changes in the Environment
6.1
In the event that there is a Force Majeure Event, a material change in the
environment in which IMH is operating its revenue cycles, or a material change
in the laws and

 
11
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

regulations that apply to IMH or R1 that significantly affects the economics of
one or more of the Parties or frustrates the ability of a Party to perform its
obligations hereunder, through no fault of its own, there will be a fair and
appropriate adjustment (increase or decrease) to portions of the Base Fee. Upon
such request, the Parties will, in good faith, discuss the costs associated with
the change in circumstance, with the outcome to equitably reflect the
incremental change in costs to deliver the Services.
6.2
Examples of matters that could trigger an adjustment to the Base Fee include the
following:

(i)
Material changes in the form of reimbursement by commercial or government
payors, including changes to a payment model such as an at-risk or partial or
fully capitated system;

(ii)
[**]

(iii)
Changes to the IMH IT Environment, which results in a material [**] in the cost
of revenue cycle operations.

 
12
 
[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

EXHIBIT B
R1 LEASED SPACE AT INTERMOUNTAIN BUILDINGS

Summary Location
Verified Working Location
Status
Home Care
11520 S Redwood Rd, South Jordan, UT 84095
IMH Owned Space
Lake Park CBO
4646 Lake Park Blvd, West Valley City
IMH Owned Space
Layton CBO
2195 N 1200 W, Layton
IMH Owned Space
Med Group CBO Springville
375 S 3 E, Springville
IMH Leased Space
Med Group CBO Riverdale
495 S 15 W, Riverdale
IMH Leased Space
Provo Eastbay CBO
75 East 1700 South, Provo
IMH Owned Space
St. George CBO (BE) & (FE)
544 S 400 E, St George
IMH Leased Space
St. George CBO (Med Group)
1490 E Foremaster Dr, St George
IMH Owned Space
St. George – Knight
616 South 300 East, St. George
IMH Leased Space

EXHIBIT B TO ADDENDUM 2 TO AMENDED AND RESTATED SERVICES AGREEMENT

[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.

--------------------------------------------------------------------------------

Confidential Draft for Discussion Purposes Only

EXHIBIT C
SAMPLE CALCULATION FOR [**]
[**]

EXHIBIT C TO ADDENDUM 2 TO AMENDED AND RESTATED SERVICES AGREEMENT

[**] Indicates that text has been omitted which is the subject of a confidential
treatment request. The text has been separately filed with the Securities and
Exchange Commission.