in the united states bankruptcy court for …omnimgt.com/cmsvol2/pub_47346/751785_229.pdfemployment...

35513537.3 07/17/2019

IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE

In re: CENTER CITY HEALTHCARE, LLC d/b/a HAHNEMANN UNIVERSITY HOSPITAL, et al.,1 Debtors.

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Chapter 11 Case No. 19-11466 (KG) Jointly Administered Hearing Date: August 16, 2019 at 10:00 a.m. (EST) Objection Deadline: July 31, 2019 at 4:00 p.m. (EST)

APPLICATION OF DEBTORS FOR ORDER AUTHORIZING (I) RETENTION AND EMPLOYMENT OF SSG ADVISORS, LLC, AS INVESTMENT BANKER TO THE

DEBTORS, NUNC PRO TUNC TO THE PETITION DATE, AND (II) A WAIVER OF COMPLIANCE WITH CERTAIN REQUIREMENTS OF LOCAL RULE 2016-2

Center City Healthcare, LLC d/b/a Hahnemann University Hospital (“CCH”) and its

affiliated debtors and debtors in possession (the “Debtors”), by and through their undersigned

proposed counsel, hereby file this application (the “Application”), pursuant to sections 327(a)

and 328(a) of title 11 of the United States Code (the “Bankruptcy Code”), Rules 2014(a) and

2016 of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”) and Rules 2014-1

and 2016-2 of the Local Rules of Bankruptcy Practice and Procedure for the United States

Bankruptcy Court for the District of Delaware (the “Local Rules”), for entry of an order,

substantially in the form attached hereto as Exhibit A (the “Proposed Order”), in the above-

captioned chapter 11 cases (the “Chapter 11 Cases”), authorizing the Debtors to employ and

retain SSG Advisors, LLC (“SSG”) as investment banker to the Debtors, nunc pro tunc to the

1 The Debtors in these cases, along with the last four digits of each Debtor’s federal tax identification

number, are: Center City Healthcare, LLC (3341), Philadelphia Academic Health System, LLC (8681), St. Christopher’s Healthcare, LLC (8395), Philadelphia Academic Medical Associates, LLC (8165), HPS of PA, L.L.C. (1617), SCHC Pediatric Associates, L.L.C. (0527), St. Christopher’s Pediatric Urgent Care Center, L.L.C. (6447), SCHC Pediatric Anesthesia Associates, L.L.C. (2326), StChris Care at Northeast Pediatrics, L.L.C. (4056), TPS of PA, L.L.C. (4862), TPS II of PA, L.L.C. (5534), TPS III of PA, L.L.C. (5536), TPS IV of PA, L.L.C. (5537), and TPS V of PA, L.L.C. (5540). The Debtors’ mailing address is 230 North Broad Street, Philadelphia, Pennsylvania 19102.

Case 19-11466-KG Doc 229 Filed 07/17/19 of 16

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Petition Date (as defined below). In support of this Application, the Debtors rely on the

Declaration of J. Scott Victor in Support of the Application of Debtors for Entry of an Order

Authorizing (I) the Employment and Retention of SSG Advisors, LLC, as Investment Banker to

the Debtors, Nunc Pro Tunc to the Petition Date, and (II) a Waiver of Compliance with Certain

Requirements of Local Rules 2016-2, a copy of which is attached hereto as Exhibit B (the

“Victor Declaration”), as well as the Declaration of Allen Wilen in Support of First Day Relief

(the “First Day Declaration”), which is incorporated herein by reference. In further support of

this Application, the Debtors respectfully represent as follows:

JURISDICTION

1. The Court has jurisdiction to consider this Application pursuant to 28 U.S.C.

§§ 157 and 1334 and the Amended Standing Order of Reference from the United States District

Court for the District of Delaware dated as of February 29, 2012. This is a core proceeding

pursuant to 28 U.S.C. § 157(b)(2). Venue is proper before the Court pursuant to 28 U.S.C.

§§ 1408 and 1409. Pursuant to Local Rule 9013-1(f), the Debtors consent to the entry of a final

order by the Court in connection with this matter to the extent that it is later determined that the

Court, absent consent of the parties, cannot enter final orders or judgments consistent with

Article III of the United States Constitution.

BACKGROUND

2. On June 30, 2019 and July 1, 2019 (together, the “Petition Date”), each of the

Debtors commenced a case under chapter 11 of the Bankruptcy Code. The Debtors are operating

their businesses and managing their properties as debtors in possession pursuant to sections

1107(a) and 1108 of the Bankruptcy Code. No request for the appointment of a trustee or

examiner has been made in the Chapter 11 Cases. On July 15, 2019, the Office of the United


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States Trustee appointed the Official Committee of Unsecured Creditors of Center City

Healthcare d/b/a Hahnemann University Hospital, et al. (the “Committee”).

3. A description of the Debtors’ businesses, capital structure, the reasons for

commencing the Chapter 11 Cases, the relief sought from the Court, and the facts and

circumstances supporting this Application are set forth in the First Day Declaration filed

contemporaneously herewith.

RELIEF REQUESTED

4. Pursuant to sections 327(a) and 328(a) of the Bankruptcy Code and Bankruptcy

Rules 2014, 2016, 5002 and 6003, the Debtors seek entry of an Order (i) authorizing the

employment and retention of SSG as their investment banker in the Chapter 11 Cases, nunc pro

tunc to the Petition Date, pursuant to the terms and conditions of the engagement letter dated as

of June 7, 2019, a copy of which is attached hereto as Exhibit C and incorporated by reference

herein (the “SSG Engagement Letter”); and (ii) granting a waiver of compliance with the

information requirements relating to compensation requests set forth in Local Rule 2016-2 to the

extent requested herein.

THE RETENTION OF SSG

A. SSG’s Qualifications

5. SSG is an internationally recognized investment banking firm with offices in New

York and Philadelphia. Since its founding in 2001, SSG has completed over 350 investment

banking assignments in North America and Europe. SSG’s professionals have expertise in

special situations mergers and acquisitions, private placements, financial restructurings,

valuations, and financial advisory services. Moreover, SSG has substantial expertise in advising

troubled healthcare service providers in numerous situations, including in connection with


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financing and asset sales and related issues, and is particularly well suited to serve as the

Debtors’ investment banker in the Chapter 11 Cases.

6. SSG’s professionals have developed extensive experience in matters involving

complex financial restructurings. Specifically, SSG has served as an investment banker for

debtors and other parties in a large number of bankruptcy cases in the Third Circuit, including

inter alia: In re NSC Wholesale Holdings, LLC, Case No. 18-12394 (CSS); In re Samuels

Jewelers, Inc., Case No. 18-11818 (KJC); In re ABT Molecular Imaging, Inc., Case No. 18-

11398 (LSS); In re Nighthawk Royalties LLC, Case No. 18-10989 (BLS); In re Vitamin World,

Inc., Case No. 17-11933 (KJC); In re Unilife Corporation, Case No. 17-10805 (LSS); In re Short

Bark Industries, Inc., Case No. 17-11502 (KG); In re Peekay Acquisition, LLC, Case No. 17-

11722 (BLS); In re Horsehead Holding Corp., Case No. 16-10287 (CSS); In re Verengo, Inc.,

Case No. 16-12098 (BLS); In re North Philadelphia Health System, Case No. 16-18931 (MDC),

and many more. As a result, the Debtors believe that SSG is well-qualified to perform these

services and represent the Debtors’ interests in the Chapter 11 Cases.

7. As set forth in the Victor Declaration, SSG was engaged by the Debtors effective

as of May 31, 2019 to provide investment banking services to the Debtors pursuant to the SSG

Engagement Letter. As a result of conversations with the Debtors and their counsel, SSG has

become, and will continue to become, intimately familiar with the Debtors’ corporate and capital

structure, management, operations, and various other aspects of their businesses. SSG is

developing knowledge of the Debtors’ financial history and business operations and is well-

suited to provide the Debtors with the investment banking services contemplated by the SSG

Engagement Letter.


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B. Services to Be Provided

8. Subject to Court approval of this Application, and consistent with the terms of the

SSG Engagement Letter,2 SSG will provide such investment banking services as SSG and the

Debtors deem appropriate, including, but not limited to, the following in connection with a

Financing Transaction:

a. Prepare an information memorandum describing the Company Group, or any part thereof, as applicable, its historical performance and prospects, including existing contracts, patient census information, medical services offered, medical, nursing and staff information, management, and financial projections;

b. Assist the Company Group in compiling a data room of any necessary and appropriate documents related to the Financing;

c. Assist the Company Group in developing a list of suitable potential lenders and investors who will be contacted on a discreet and confidential basis after approval by the Company Group;

d. Coordinate the execution of confidentiality agreements for potential lenders and investors wishing to review the information memorandum;

e. Assist the Company Group in coordinating site visits for interested lenders and investors and work with the management team to develop appropriate presentations for such visits;

f. Solicit competitive offers from potential lenders and investors;

g. Advise and assist the Company Group in structuring the Financing and negotiating the Financing agreements; and

h. Otherwise assist the Company Group and its other professionals, as necessary, through closing on a best efforts basis.

2 The summary set forth herein is qualified in its entirety by the terms of the SSG Engagement Letter, and

the terms of the SSG Engagement Letter shall control in the event of a conflict. Capitalized terms not otherwise defined in this section shall have the meaning ascribed to them in the SSG Engagement Letter.


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9. SSG may also provide such investment banking services as SSG and the Debtors

deem appropriate, including, but not limited to, the following, in connection with a Sale

Transaction:

a. Prepare an information memorandum describing Company Group, or any part thereof, as applicable, its historical performance and prospects, including existing contracts, patient census information, medical services offered, medical, nursing and staff information, management and anticipated financial results of the Company Group;

b. Assist the Company Group in developing a list of suitable potential buyers for specific assets of the Company Group who will be contacted on a discreet and confidential basis after approval by the Company Group;

c. Assist the Company Group in compiling a data room of any necessary and appropriate documents related to the Sale;

d. Coordinate the execution of confidentiality agreements for potential buyers wishing to review the information memorandum;

e. Assist the Company Group in coordinating site visits for interested buyers and work with the management team to develop appropriate presentations for such visits;

f. Solicit competitive offers from potential buyers;

g. Advise and assist the Company Group in structuring the Sale and negotiating the Sale agreements, including, without limitation, advising and negotiating with respect to Sale structures that include, as may be necessary or desirable, licenses or assignments of intellectual property and leasing arrangement of GME/IME caps/slots; and

h. Otherwise assist the Company Group, its attorneys and accountants, as necessary, through closing on a best efforts basis.


deem appropriate, including, but not limited to, the following, in connection with a Restructuring

Transaction:

a. SSG, on a best effort basis, shall assist the Company Group in any negotiation with various stakeholders (the “Existing Stakeholders”), including, but not limited to any of the Company Group's lenders, creditors, strategic partners


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and/or other stakeholders in regard to a possible Restructuring Transaction of existing claims and equity;

b. Complete all necessary and appropriate valuations in connection with any Company conversion from a for-profit entity into a not-for-profit entity; and

c. Assist the Company Group in compiling a data room of any necessary and appropriate documents related to the Restructuring.

11. The Debtors require qualified professionals to render these essential professional

services. As noted above, SSG has substantial expertise in all areas for which it is proposed to

be retained. Accordingly, the Debtors submit that SSG is well qualified and best suited to

perform these services and to assist the Debtors in the Chapter 11 Cases.

12. The services that SSG will provide to the Debtors are necessary to enable the

Debtors to identify the highest and best possible bid for their assets in the case of a sale, or

otherwise effectuate a financing or restructuring transaction that is in the best interests of their

estates, creditors and parties in interest. All of the services that SSG will provide to the Debtors

will be undertaken at the request of the Debtors and will be appropriately directed by the Debtors

so as to avoid duplicative efforts among the professionals retained in the Chapter 11 Cases. SSG

will also use reasonable efforts to coordinate with the Debtors’ other retained professionals to

avoid the unnecessary duplication of services.

C. Professional Compensation

13. Subject to this Court’s approval and as set forth in the SSG Engagement Letter,3

the Debtors and SSG have agreed to the following compensation and expense structure (the “Fee

and Expense Structure”) in consideration for the services to be rendered by SSG in the Chapter

11 Cases:


the terms of the SSG Engagement Letter shall control in the event of a conflict.


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a. Initial Fee. An initial fee (the “Initial Fee”) equal to $50,000 due upon acceptance of the Engagement Agreement by the Company Group. SSG received this Initial Fee on June 5, 2019.

b. Monthly Fees. A monthly fee (the “Monthly Fee”) of $50,000 per month payable beginning July 1, 2019 and on the first (1st) of each month thereafter throughout the Engagement Term. If the Engagement Term ends prior to the last day of any month, the Monthly Fee for the last month of the Engagement Term shall be prorated for such month. Fifty percent (50%) of the Monthly Fees and Initial Fee paid will be credited to the Transaction Fee (defined below). However, there will be no such Monthly Fee credit for any Sale to Drexel University. SSG received the July Monthly Fee prior to the Petition Date.

c. Financing Fee. Upon the closing and funding of a Financing Transaction from any party other than Midcap Financial, Harrison Street Real Estate, Tenet Business Services Corporation, Conifer Revenue Cycle Management, or any of their respective Affiliates (each, an “Existing Financing Source”), SSG shall be entitled to a fee (“Financing Fee”) payable in cash, in federal funds via wire transfer or certified check, at and as a condition of closing of such Financing Transaction equal to (a) the greater of (i) $450,000 or (ii) one and a half percent (1.5%) of the principal amount of any Senior Debt, plus 4% of the principal amount of any Tranche B or Traditional Subordinated Debt or the aggregate securities proceeds (net of any fees and expenses thereof) of Equity (each such term as hereafter defined) raised from any financing source other than an Existing Financing Source. The Financing Fee shall be reduced by 50% if a Financing Transaction is with, or is led by, Capital One or Sector Financial, or their Affiliates. Notwithstanding the foregoing, SSG shall be entitled to a Financing Fee of $150,000 for a Financing Transaction from an Existing Financing Source.

d. Sale Fee. Upon the consummation of a Sale Transaction, SSG shall be entitled to a fee (the “Sale Fee”), payable in cash, in federal funds via wire transfer or certified check, at and as a condition of closing of such Sale Transaction, equal to the greater of: (a) $750,000; or (b) one and a half percent (1.5%) of Total Consideration (defined below) up to and including $100 million; plus two percent (2.0%) of Total Consideration over $100 million. However, in the event that a Sale to Drexel University, or any of its Affiliates, closes outside of a Chapter 11 bankruptcy proceeding and within one hundred (100) days from the date hereof, then the Sale Fee for such Transaction shall be $250,000. In the event of a Sale to Drexel University in a Chapter 11 bankruptcy proceeding or outside of a Chapter 11 bankruptcy


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proceeding but after one (100) hundred days from the date hereof, then the Sale Fee for such Transaction shall be $750,000. In the event of a liquidation of either or both of the operating hospital entities in a PAHC Chapter 11 bankruptcy proceeding, then SSG shall be entitled to a liquidation fee of $250,000 (“Liquidation Fee”).

e. Restructuring Fee. Upon the closing of a Restructuring Transaction, SSG shall be entitled to a fee (“Restructuring Fee”) payable in cash, in federal funds via wire transfer or certified check, at and as a condition of closing of such Restructuring Transaction, equal to $750,000.

f. Out-of-Pocket Expenses. In addition to the foregoing Initial Fee, Monthly Fee and Transaction Fee noted above, whether or not a Transaction is consummated, SSG will be entitled to reimbursement for all of SSG's reasonable and documented out-of-pocket expenses (other than any overhead expenses of SSG) incurred in connection with the subject matter of this Engagement Agreement; provided that no expenses in excess of $25,000 in the aggregate will be reimbursed by any Company or the Company Group without the prior written approval thereof.

14. SSG and the Debtors have agreed pursuant to the SSG Engagement Letter that the

Sale Fee shall be paid to SSG as a direct carve-out from the proceeds of a sale transaction or a

liquidation, prior in right to the rights of any other party.

15. The Fee and Expense Structure described above is comparable to compensation

generally charged by investment banking firms for comparable engagements, both in and out of

court. The Fee and Expense Structure is also consistent with SSG’s normal and customary

billing practices for cases of this size and complexity that require the level and scope of services

outlined. SSG and the Debtors also believe that the Fee and Expense Structure is reasonable and

at favorable market rates.

D. Waiver of Compliance with Requirements Regarding Time Entry Detail

16. SSG’s industry and restructuring experience, its capital markets knowledge,

financing skills, and mergers and acquisitions capabilities, some or all of which may be required

by the Debtors during the term of SSG’s engagement, were important factors in determining the


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Fee and Expense Structure. The ultimate benefit to the Debtors of SSG’s services could not be

measured merely by reference to the number of hours to be expended by SSG’s professionals in

the performance of such services. Moreover, the Fee and Expense Structure takes into

consideration SSG’s anticipation that it will need to provide a substantial commitment of

professional time and effort in order to perform its duties under the SSG Engagement Letter and

in light of the fact that such commitment may foreclose other opportunities for SSG.

17. Because of SSG’s expertise, commitment of resources to this engagement to the

exclusion of other possible employment, and the time that SSG will devote to this engagement,

the Debtors request that the Court approve the Fee and Expense Structure for SSG pursuant to

section 328(a) of the Bankruptcy Code and that the Court evaluate the final compensation and

reimbursement of expenses in the Chapter 11 Cases for SSG under the standards of section

328(a) of the Bankruptcy Code, rather than under those of section 330 of the Bankruptcy Code.

18. SSG will file with the Court a final fee application for allowance of its

compensation and reimbursement of its expenses with respect to services rendered in accordance

with applicable provisions of the Bankruptcy Code, the Bankruptcy Rules, the Local Rules, the

applicable guidelines for compensation and reimbursement of expenses established by the U.S.

Trustee (the “UST Guidelines”), and any applicable orders of the Court. However, the Debtors

are advised by SSG that it is not the general practice of investment banking firms to keep

detailed time records similar to those customarily kept by attorneys or to keep time records on a

“project category” basis. Furthermore, SSG’s Fee and Expense Structure provides for a flat fee

based on the occurrence of a Transaction (as defined in the SSG Engagement Letter).

19. As SSG’s compensation will be calculated, depending on the type of transaction

as contemplated by the SSG Engagement Letter, SSG requests that they not be required to file


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time records in accordance with Local Rule 2016-2 and the UST Guidelines. Instead,

notwithstanding that SSG does not charge for its services on an hourly basis, SSG will maintain

records in half (.50) hour increments (in summary format) of its services rendered for the

Debtors, including descriptions of those services, the time expended in providing those services

and the individuals who provided those services, and will present such records together with its

final and sole fee application filed with the Court.

20. SSG has not shared or agreed to share any compensation to be paid by the

Debtors with any other person, other than other principals and employees of SSG, in accordance

with section 504 of the Bankruptcy Code.

E. Indemnification

21. The SSG Engagement Letter further provides that the Debtors will indemnify and

hold harmless SSG and its members, partners, officers, agents, employees, and affiliates (each,

an “Indemnified Party,” and collectively, the “Indemnified Persons”), from and against any

and all losses, claims, judgments, liabilities, costs, damages, and expenses, including reasonable

attorneys’ fees that SSG may incur, arising out of any services provided by SSG to the Debtors

in pursuant to the SSG Engagement Letter, other than those resulting from SSG’s gross

negligence or willful misconduct (such obligations being referred to as the “Indemnification

Provisions”), which provisions are set forth in greater detail in the SSG Engagement Letter.

22. The Indemnification Provisions are standard indemnification terms, both in

chapter 11 cases and outside chapter 11, and reflect the qualifications and limits on such terms

that are customary for SSG and other similar investment bankers as approved in this and other

jurisdictions. The Indemnification Provisions were fully negotiated between the Debtors and

SSG at arm’s length and the Debtors respectfully submit that the Indemnification Provisions are


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reasonable and in the best interests of the Debtors, their estates, and creditors. Accordingly, as

part of this Application, the Debtors request that this Court approve the Indemnification

Provisions.

F. SSG’s Disinterestedness

23. To the best of the Debtors’ knowledge, and as disclosed herein and in the Victor

Declaration: (i) SSG is a “disinterested person” within the meaning of section 101(14) of the

Bankruptcy Code, as required by section 327(a) of the Bankruptcy Code and does not hold or

represent any interest adverse to the Debtors’ estates; and (ii) SSG has no connection to the

Debtors, their creditors or related parties, except as may be disclosed in the Victor Declaration.

24. SSG will review its files against any updated Potential Interested Parties List (as

defined in the Victor Declaration) received from the Debtors from time to time during the

pendency of the Chapter 11 Cases pursuant to the procedures described in the Victor

Declaration. If any new relevant facts or relationships are discovered or arise in such review,

SSG will use reasonable efforts to identify such further developments and will file promptly a

supplemental declaration where appropriate.

25. SSG is not a creditor of the Debtors’ bankruptcy estates as of the Petition Date.

BASIS FOR RELIEF

26. Section 327(a) of the Bankruptcy Code provides that a debtor, subject to court

approval:

[M]ay employ one or more attorneys, accountants, appraisers, auctioneers, or other professional persons, that do not hold or represent an interest adverse to the estate, and that are disinterested persons, to represent or assist the [debtor] in carrying out the [debtor’s] duties under [the Bankruptcy Code].

11 U.S.C. § 327(a).


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27. Section 328(a) of the Bankruptcy Code provides, in relevant part, that:

The [debtor] . . . with the court’s approval, may employ or authorize the employment of a professional person under section 327 . . . of this title . . . on any reasonable terms and conditions of employment, including on a retainer, on an hourly basis, on a fixed or percentage fee basis, or on a contingent fee basis. Notwithstanding such terms and conditions, the court may allow compensation different from the compensation provide under such terms and conditions after the conclusion of such employment, if such terms and conditions prove to have been improvident in light of developments not capable of being anticipated at the time of the fixing of such terms and conditions.

11 U.S.C. § 328(a).

28. In addition, Bankruptcy Rule 2014(a) requires that an application for retention

include:

[S]pecific facts showing the necessity for the employment, the name of the [firm] to be employed, the reasons for the selection, the professional services to be rendered, any proposed arrangement for compensation, and, to the best of the applicant’s knowledge, all of the [firm’s] connections with the debtor, creditors, any other party in interest, their respective attorneys and accountants, the United States trustee, or any person employed in the office of the United States trustee.

Fed. R. Bankr. P. 2014(a).

29. The resources, capabilities, and experience of SSG in advising the Debtors are

crucial to the Debtors during the Chapter 11 Cases. SSG and its professionals have extensive

experience and an excellent reputation for providing high quality advisory services to debtors

and creditors in large and complex chapter 11 cases and other debt restructurings. SSG

possesses and will continue to develop its knowledge of the Debtors’ financial history and

business operations and is well suited to provide the Debtors with the investment banking

services contemplated by the SSG Engagement Letter.


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30. Furthermore, in the event the Application is not granted, the Debtors and their

estates would be significantly harmed. The Debtors would be forced to locate a new investment

banker lacking the same understanding of the Debtors’ business and restructuring initiatives.

Also, engaging a new investment banker would require the Debtors to expend additional time

and divert their resources at a critical stage of the Chapter 11 Cases. For these reasons, the

Debtors believe that the retention of SSG is in the best interest of their estates and that the

Application should be granted.

31. As stated in the Victor Declaration, SSG is a “disinterested person” within the

meaning of section 101(14) of the Bankruptcy Code, as required by section 327(a) of the

Bankruptcy Code, and does not hold or represent an interest adverse to the Debtors’ estates and

has no connection to the Debtors, their creditors or related parties except as may be disclosed in

the Victor Declaration. The Debtors also believe that the Fee and Expense Structure is

reasonable and should be approved by the Court under section 328(a) of the Bankruptcy Code in

light of: (a) the nature of services to be provided by SSG; (b) SSG’s substantial experience with

respect to financial advisory services; (c) fee and expenses provisions typically utilized by SSG

and other leading financial advisory firms, which do not bill their time on an hourly basis and

generally are compensated on a transactional basis; and (d) the complexity and scope of work

anticipated to be performed by SSG in connection with the Chapter 11 Cases.

32. Moreover, as noted above, the Indemnification Provisions are standard terms,

both in chapter 11 cases and outside chapter 11, and reflect the qualifications and limits on such

terms that are customary for SSG and other similar investment bankers as approved in this and

other jurisdictions. See United Artists Theatre Co. v. Walton (In re United Artists Theatre Co.),

315 F.3d 217, 234 (3d Cir. 2003) (finding that indemnification agreement between debtor and


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financial advisor was reasonable under section 328 of the Bankruptcy Code). Indeed, courts in

this jurisdiction and others have granted similar relief. See, e.g., In re A123 Systems, Inc., No.

12-12859 (KJC); In re CHL, Ltd., No. 12-12437 (KJC); In re Int’lMedia Group, Inc., No.

12¬10140 (MFW).

33. For the foregoing reasons, the Debtors submit that the retention of SSG as

investment banker is warranted and satisfies the requirements of sections 327(a) and 328(a) of

the Bankruptcy Code and Bankruptcy Rule 2014(a).

NOTICE

34. The Debtors have provided notice of the filing of the Motion to: (i) the Office of

the United States Trustee; (ii) counsel to the Committee; (iii) counsel to MidCap Funding IV

Trust; (iv) Drexel University d/b/a Drexel University College of Medicine; (v) the Debtors’

unions; (vi) the Internal Revenue Service; (vii) the United States Attorney for the District of

Delaware; (viii) the United States Department of Justice; (ix) the Pennsylvania Attorney

General’s Office; (x) the Pennsylvania Department of Health; (xi) the City of Philadelphia; and

(xii) any party that has requested notice pursuant to Bankruptcy Rule 2002.

[Remainder of page intentionally left blank]


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WHEREFORE, the Debtors respectfully request the entry of an order, substantially in

the form of the Proposed Order (i) authorizing the Debtors to retain and employ SSG as

investment banker to the Debtors, nunc pro tunc to the Petition Date, on the terms set forth in the

SSG Engagement Letter, (ii) waiving compliance with certain requirements of Local Rule 2016-

2, and (iii) granting such other and further relief as this Court deems just and proper.

Dated: July 17, 2019 Philadelphia Academic Health System, LLC (for itself and on behalf of its affiliates Debtors as debtors and debtors in possession)

By: /s/ Allen Wilen_________________ Name: Allen Wilen Title: Chief Restructuring Officer


35513537.3 07/17/2019



)))) ) ) ) ) )

Chapter 11 Case No. 19-11466 (KG) Jointly Administered Hearing Date: August 16, 2019 at 10:00 a.m. (EST) Objection Deadline: July 31, 2019 at 4:00 p.m. (EST)

NOTICE OF APPLICATION

PLEASE TAKE NOTICE that on July 17, 2019, the above-captioned debtors and

debtors in possession (the “Debtors”) filed the Application of Debtors for Order Authorizing (1) Retention and Employment of SSG Advisors, LLC, as Investment Banker to the Debtors, Nunc Pro Tunc to the Petition Date, and (II) a Waiver of Compliance with Certain Requirements of Local Rule 2016-2 (the “Application”).

PLEASE TAKE FURTHER NOTICE that any responses or objections to the

Application must be made in writing, filed with the Clerk of the Bankruptcy Court, and served upon the undersigned counsel to the Debtors, so as to actually be received by or before July 31, 2019 at 4:00 p.m. (EST).

PLEASE TAKE FURTHER NOTICE that a hearing on the Application shall be held

on August 16, 2019 at 10:00 a.m. (EST), before the Honorable Kevin Gross, United States Bankruptcy Court for the District of Delaware, at 824 Market Street, 6th Floor, Courtroom 3, Wilmington, DE 19801.

IF NO OBJECTION OR RESPONSE TO THE APPLICATION IS TIMELY FILED,

SERVED AND RECEIVED IN ACCORDANCE WITH THIS NOTICE, THE BANKRUPTCY COURT MAY GRANT THE RELIEF REQUESTED IN THE APPLICATION WITHOUT FURTHER NOTICE OR HEARING.



Case 19-11466-KG Doc 229-1 Filed 07/17/19 Page 1 of 2

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Dated: July 17, 2019 SAUL EWING ARNSTEIN & LEHR LLP

By: /s/ Monique B. DiSabatino

Mark Minuti (DE Bar No. 2659) Monique B. DiSabatino (DE Bar No. 6027) 1201 N. Market Street, Suite 2300 P.O. Box 1266 Wilmington, DE 19899 Telephone: (302) 421-6800 Fax: (302) 421-5873 [email protected] [email protected] -and- Jeffrey C. Hampton Adam H. Isenberg Aaron S. Applebaum (DE Bar No. 5587) Jeremiah J. Vandermark Centre Square West 1500 Market Street, 38th Floor Philadelphia, PA 19102 Telephone: (215) 972-7700 Fax: (215) 972-7725 [email protected] [email protected] [email protected] [email protected] Proposed Counsel for Debtors and Debtors in Possession


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EXHIBIT A

Proposed Order


35513537.3 07/17/2019



)))) ) ) ) ) )

Chapter 11 Case No. 19-11466 (KG) Jointly Administered Related to Docket No. ___

ORDER AUTHORIZING (I) THE EMPLOYMENT AND RETENTION OF SSG

ADVISORS, LLC AS INVESTMENT BANKER TO THE DEBTORS NUNC PRO TUNC TO THE PETITION DATE AND (II) A WAIVER OF COMPLIANCE WITH CERTAIN

REQUIREMENTS OF LOCAL RULE 2016-2

Upon the application (the “Application”)2 of the above-captioned debtors and debtors-in-

possession (collectively, the “Debtors”) for entry of an order (this “Order”) (i) authorizing the

Debtors to employ and retain SSG Advisors, LLC (“SSG”) as investment banker to the Debtors

nunc pro tunc to the Petition Date, and (ii) waiving compliance with certain requirements of

Local Rule 2016-2; and upon consideration of the Victor Declaration and the First Day

Declaration; and it appearing that this Court has jurisdiction over the Application pursuant to 28

U.S.C. §§ 57 and 1334; and it appearing that venue of the Chapter 11 Cases and the Application

in this District is proper pursuant to 28 U.S.C. §§ 1408 and 1409; and it appearing that this

matter is a core proceeding pursuant to 28 U.S.C. § 157(b); and this Court being satisfied based

on the representations made in the Application and in the Victor Declaration that the terms and 1 The Debtors in these cases, along with the last four digits of each Debtor’s federal tax identification


2 Capitalized terms used but not otherwise defined herein shall have the meanings ascribed in the Application.


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conditions of SSG’s employment as set forth in the SSG Engagement Letter and summarized in

the Application and in the Victor Declaration, are reasonable as required by section 328(a) of the

Bankruptcy Code; and SSG not holding or representing interests adverse to the Debtors’ estates;

and SSG being a “disinterested person” as such term is defined under section 101(14) of the

Bankruptcy Code; and this Court having found that the relief requested in the Application is in

the best interests of the Debtors’ estates, their creditors and other parties in interest; and due and

proper notice of the Application having been provided, and it appearing that no other or further

notice need be provided; and upon the record of the hearing, if any, and all of the proceedings

had before the Court; and upon finding that the legal and factual bases set forth in the

Application establish just cause for the relief granted herein; and after due deliberation and

sufficient cause appearing therefor:

IT IS HEREBY ORDERED THAT:

1. The Application is GRANTED to the extent provided herein.

2. The Debtors are authorized, pursuant to sections 327(a) and 328(a) of the

Bankruptcy Code, Bankruptcy Rules 2014(a) and 2016, and Local Rules 2014-1 and 2016-1, to

employ and retain SSG as their investment banker in connection with the Chapter 11 Cases in

accordance with the terms and conditions set forth in the Application and in the SSG

Engagement Letter, nunc pro tunc to the Petition Date.

3. The Debtors are authorized to compensate and reimburse SSG pursuant to the

terms of the SSG Engagement Letter.

4. The Fee and Expense Structure as set forth in the SSG Engagement Letter, is

approved pursuant to section 328(a) of the Bankruptcy Code, and SSG shall be compensated and

reimbursed for its fees and expenses in the Chapter 11 Cases pursuant to section 328(a) of the


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Bankruptcy Code in accordance with the terms of the SSG Engagement Letter, subject to the

procedures set forth in the Bankruptcy Code, the Bankruptcy Rules, the Local Rules, the UST

Guidelines and any applicable orders of this Court.

5. The Sale Fee shall be paid to SSG as a direct carve-out from the proceeds of a

sale transaction or a liquidation, prior in right to the rights of any other party

6. SSG’s compensation shall be subject to the standard of review provided in section

328(a) of the Bankruptcy Code and not subject to any other standard of review under section 330

of the Bankruptcy Code; provided, however, that the U.S. Trustee shall have the right to object to

SSG’s request for compensation and expense reimbursement based on the reasonableness

standard provided in section 330 of the Bankruptcy Code, and not section 328(a) of the

Bankruptcy Code.

7. SSG shall comply with all requirements of Bankruptcy Rule 2016(a) and Local

Rule 2016-2, except that SSG is hereby granted a limited waiver of the information-keeping

requirements of Local Rule 2016-2 to permit the firm to keep professional time records in half-

hour increments, and SSG shall not be required to conform to any schedule of hourly rates for its

professionals. For the avoidance of doubt, SSG shall be entitled to payment of its Monthly Fees

without the need for monthly or interim applications for compensation.

8. The Indemnification Provisions set forth in the SSG Engagement Letter are

approved, subject during the pendency of the Debtors’ Chapter 11 Cases to the following:

a. Subject to the provisions of subparagraphs (b) and (c) below, the Debtors are authorized to indemnify, and shall indemnify, SSG for any claims arising from, related to, or in connection with the services to be provided by SSG as specified in the Application, but not for any claim arising from, related to, or in connection with SSG post-petition performance of any other services other than those in connection with the engagement, unless such post-petition services and indemnification therefor are approved by this Court;


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b. Notwithstanding any provisions of the SSG Engagement Letter to the contrary, the Debtors shall have no obligation to indemnify SSG or provide contribution or reimbursement to SSG (i) for any claim or expense that is judicially determined (the determination having become final) to have arisen from SSG’s bad faith, self-dealing, breach of fiduciary duty (if any), willful misconduct or gross negligence, (ii) for a contractual dispute in which the Debtors allege the breach of SSG’s contractual obligations if the Court determines that indemnification, contribution, or reimbursement would not be permissible pursuant to In re United Artists Theatre Company, 315 F.3d 217 (3d Cir. 2003), or (iii) for any claim or expense that is settled prior to a judicial determination as to the exclusions set forth in clauses (i) and (ii) above, but determined by the Court, after notice and a hearing pursuant to subparagraph (c), infra, to be a claim or expense for which SSG should not receive indemnity, contribution or reimbursement under the terms of the SSG Engagement Letter, as modified by this Order; and

c. If, before the earlier of (i) the entry of an order confirming a chapter 11 plan in these cases (that order having become a final order no longer subject to appeal), and (ii) the entry of an order closing these Chapter 11 Cases, SSG believes that it is entitled to the payment of any amounts by the Debtors on account of the Debtors’ indemnification obligations under the Application, including, without limitation, the advancement of defense costs, SSG must file an application in this Court, and the Debtors may not pay any such amounts to SSG before the entry of an order by this Court approving the payment. This subparagraph (c) is intended only to specify the period of time under which the Court shall have jurisdiction over any request for fees and expenses by SSG for indemnification, and not as a provision limiting the duration of the Debtors’ obligation to SSG.

9. Notwithstanding any provision in the SSG Engagement Letter to the contrary, the

contribution obligations of the Indemnified Parties (as such term is defined in the Application)

shall not be limited to the aggregate amount in excess of the amount of fees actually received by

SSG from the Debtors pursuant to the SSG Engagement Letter, this Order or subsequent orders

of this Court.

10. Notwithstanding anything to the contrary in the SSG Engagement Letter, effective

upon the filing of the Chapter 11 Cases, SSG’s engagement by Philadelphia Academic Risk

Retention Group, LLC was terminated.


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11. To the extent the Application or the SSG Engagement Letter is inconsistent with

the terms of this Order, the terms of this Order shall govern.

12. The Debtors are authorized and empowered to take all actions necessary to

implement the relief granted in this order.

13. The terms and conditions of this Order shall be immediately effective and

enforceable upon its entry.

14. This Court shall retain jurisdiction to hear and to determine all matters arising

from or related to the implementation of this Order.


35513537.3 07/17/2019

Exhibit B

Victor Declaration


35513537.3 07/17/2019



)))) ) ) ) ) )

Chapter 11 Case No. 19-11466 (KG) Jointly Administered

DECLARATION OF J. SCOTT VICTOR IN SUPPORT OF DEBTORS’ APPLICATION

FOR ENTRY OF AN ORDER AUTHORIZING (I) THE EMPLOYMENT AND RETENTION OF SSG ADVISORS, LLC AS INVESTMENT BANKER TO THE

DEBTORS NUNC PRO TUNC TO THE PETITION DATE AND (II) A WAIVER OF COMPLIANCE WITH CERTAIN REQUIREMENTS OF LOCAL RULE 2016-2

I, J. Scott Victor, being duly sworn according to law, depose and state that:

1. I am a Managing Director of SSG Advisors, LLC (“SSG”), an investment

banking firm that maintains offices at, among other places, Five Tower Bridge, Suite 420, 300

Barr Harbor Drive, West Conshohocken, PA 19428, and I am duly authorized to make this

declaration (the “Declaration”) on behalf of SSG. I have over 35 years of experience in the

restructuring industry and extensive experience: (i) marketing companies or their assets for sale,

including experience marketing companies in distress and debtors in bankruptcy cases;

(ii) raising capital for special situation transactions; and (iii) restructuring companies’ balance

sheets both in court and out of court.




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2. I submit this Declaration on behalf of SSG in support of the application of the

above-captioned debtors and debtors-in-possession (together, the “Debtors”) for entry of an

order authorizing the employment and retention of SSG as investment banker for the Debtors

nunc pro tunc to the Petition Date (the “Application”).2 This Declaration is also submitted as

the statement required pursuant to sections 327, 328(a) and 504 of the Bankruptcy Code and

Bankruptcy Rule 2014(a).

3. Unless otherwise indicated herein, the facts set forth in this Declaration are

personally known to me and, if called as a witness, I could and would testify thereto.

A. SSG’s Qualifications

4. SSG is an internationally recognized investment banking firm with offices in New

York and Philadelphia. Since its founding, SSG has completed over 350 investment banking

assignments in North America and Europe.

5. SSG’s professionals have expertise in special situations mergers and acquisitions,

private placements, financial restructurings, valuations, and financial advisory services.

Moreover, SSG has substantial expertise in advising troubled healthcare service providers in

numerous situations, including in connection with financing, asset sales and related issues, and is

particularly well suited to serve as the Debtors’ investment banker in the Chapter 11 Cases.

6. SSG’s professionals have developed extensive experience in matters involving

complex financial restructurings. Specifically, SSG has served as an investment banker for

debtors and other parties in a large number of bankruptcy cases in the Third Circuit, including

inter alia: In re NSC Wholesale Holdings, LLC, Case No. 18-12394 (CSS); In re Samuels

Jewelers, Inc., Case No. 18-11818 (KJC); In re ABT Molecular Imaging, Inc., Case No. 18-

2 Each capitalized term used but not otherwise defined herein shall have the meaning ascribed thereto in the

Application.


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11398 (LSS); In re Nighthawk Royalties LLC, Case No. 18-10989 (BLS); In re Vitamin World,

Inc., Case No. 17-11933 (KJC); In re Unilife Corporation, Case No. 17-10805 (LSS); In re Short

Bark Industries, Inc., Case No. 17-11502 (KG); In re Peekay Acquisition, LLC, Case No. 17-

11722 (BLS); In re Horsehead Holding Corp., Case No. 16-10287 (CSS); In re Verengo, Inc.,

Case No. 16-12098 (BLS); In re North Philadelphia Health System, Case No. 16-18931 (MDC),

and many more. As a result, the Debtors believe that SSG is well-qualified to perform these

services and represent the Debtors’ interests in the Chapter 11 Cases.

7. SSG was engaged by the Debtors effective as of May 31, 2019, to provide

investment banking services to the Debtors pursuant to the SSG Engagement Letter. As a result

of conversations with the Debtors and their counsel, SSG has become, and will continue to

become, intimately familiar with the Debtors’ corporate and capital structure, management,

operations, and various other aspects of their businesses. SSG is developing knowledge of the

Debtors’ financial history and business operations and is well-suited to provide the Debtors with

the investment banking services contemplated by the SSG Engagement Letter.

B. Services to Be Provided

8. Subject to Court approval of this Application, and consistent with the terms of the

SSG Engagement Letter,3 SSG will provide such investment banking services as SSG and the

Debtors deem appropriate, including, but not limited to, the following in connection with a

Financing Transaction:

a. Prepare an information memorandum describing the Company Group, or any part thereof, as applicable, its historical performance and prospects, including existing contracts, patient census information, medical services offered,


the terms of the SSG Engagement Letter shall control in the event of a conflict. Capitalized terms not otherwise defined in this section shall have the meaning ascribed to them in the SSG Engagement Letter.


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medical, nursing and staff information, management, and financial projections;

b. Assist the Company Group in compiling a data room of any necessary and appropriate documents related to the Financing;

c. Assist the Company Group in developing a list of suitable potential lenders and investors who will be contacted on a discreet and confidential basis after approval by the Company Group;

d. Coordinate the execution of confidentiality agreements for potential lenders and investors wishing to review the information memorandum;

e. Assist the Company Group in coordinating site visits for interested lenders and investors and work with the management team to develop appropriate presentations for such visits;

f. Solicit competitive offers from potential lenders and investors;

g. Advise and assist the Company Group in structuring the Financing and negotiating the Financing agreements; and

h. Otherwise assist the Company Group and its other professionals, as necessary, through closing on a best efforts basis.


deem appropriate, including, but not limited to, the following, in connection with a Sale

Transaction:

a. Prepare an information memorandum describing Company Group, or any part thereof, as applicable, its historical performance and prospects, including existing contracts, patient census information, medical services offered, medical, nursing and staff information, management and anticipated financial results of the Company Group;

b. Assist the Company Group in developing a list of suitable potential buyers for specific assets of the Company Group who will be contacted on a discreet and confidential basis after approval by the Company Group;

c. Assist the Company Group in compiling a data room of any necessary and appropriate documents related to the Sale;

d. Coordinate the execution of confidentiality agreements for potential buyers wishing to review the information memorandum;


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e. Assist the Company Group in coordinating site visits for interested buyers and

work with the management team to develop appropriate presentations for such visits;

f. Solicit competitive offers from potential buyers;

g. Advise and assist the Company Group in structuring the Sale and negotiating the Sale agreements, including, without limitation, advising and negotiating with respect to Sale structures that include, as may be necessary or desirable, licenses or assignments of intellectual property and leasing arrangement of GME/IME caps/slots; and

h. Otherwise assist the Company Group, its attorneys and accountants, as necessary, through closing on a best efforts basis.


deem appropriate, including, but not limited to, the following, in connection with a Restructuring

Transaction:

a. SSG, on a best effort basis, shall assist the Company Group in any negotiation with various stakeholders (the “Existing Stakeholders”), including, but not limited to any of the Company Group's lenders, creditors, strategic partners and/or other stakeholders in regard to a possible Restructuring Transaction of existing claims and equity;

b. Complete all necessary and appropriate valuations in connection with any Company conversion from a for-profit entity into a not-for-profit entity; and

c. Assist the Company Group in compiling a data room of any necessary and appropriate documents related to the Restructuring.

11. The Debtors require qualified professionals to render these essential professional

services. As noted above, SSG has substantial expertise in all areas for which it is proposed to

be retained. Accordingly, the Debtors submit that SSG is well qualified and best suited to

perform these services and to assist the Debtors in the Chapter 11 Cases.

12. The services that SSG will provide to the Debtors are necessary to enable the

Debtors to identify the highest and best possible bid for their assets in the case of a sale, or


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otherwise effectuate a financing or restructuring transaction that is in the best interests of their

estates, creditors and parties in interest. All of the services that SSG will provide to the Debtors

will be undertaken at the request of the Debtors and will be appropriately directed by the Debtors

so as to avoid duplicative efforts among the professionals retained in the Chapter 11 Cases. SSG

will also use reasonable efforts to coordinate with the Debtors’ other retained professionals to

avoid the unnecessary duplication of services.

C. Professional Compensation

13. Subject to this Court’s approval and as set forth in the SSG Engagement Letter,4

the Debtors and SSG have agreed to the following compensation and expense structure (the “Fee

and Expense Structure”) in consideration for the services to be rendered by SSG in the Chapter

11 Cases:

a. Initial Fee. An initial fee (the “Initial Fee”) equal to $50,000 due upon acceptance of this Engagement Agreement by the Company Group; SSG hereby acknowledges that it has received the Initial Fee on June 5, 2019.

b. Monthly Fees. A monthly fee (the “Monthly Fee”) of $50,000 per month payable beginning July 1, 2019 and on the first (1st) of each month thereafter throughout the Engagement Term (as such term is hereafter defined); if the Engagement Term ends prior to the last day of any month, the Monthly Fee for the last month of the Engagement Term shall be prorated for such month. Fifty percent (50%) of the Monthly Fees and Initial Fee paid will be credited to the Transaction Fee (defined below). However, there will be no such Monthly Fee credit for any Sale to Drexel University. SSG received the July Monthly Fee prior to the Petition Date.

c. Financing Fee. Upon the closing and funding of a Financing Transaction from any party other than Midcap Financial, Harrison Street Real Estate, Tenet Business Services Corporation, Conifer Revenue Cycle Management, or any of their respective Affiliates (each, an “Existing Financing Source”), SSG shall be entitled to a fee (“Financing Fee”) payable in cash, in federal funds via wire transfer or certified check, at and as a condition of closing of such Financing Transaction equal to (a) the greater of (i) $450,000 or (ii) one and a


the terms of the SSG Engagement Letter shall control in the event of a conflict.


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half percent (1.5%) of the principal amount of any Senior Debt, plus 4% of the principal amount of any Tranche B or Traditional Subordinated Debt or the aggregate securities proceeds (net of any fees and expenses thereof) of Equity (each such term as hereafter defined) raised from any financing source other than an Existing Financing Source. The Financing Fee shall be reduced by 50% if a Financing Transaction is with, or is led by, Capital One or Sector Financial, or their Affiliates.

Notwithstanding the foregoing, SSG shall be entitled to a Financing Fee of $150,000 for a Financing Transaction from an Existing Financing Source.

d. Sale Fee. Upon the consummation of a Sale Transaction, SSG shall be entitled

to a fee (the “Sale Fee”), payable in cash, in federal funds via wire transfer or certified check, at and as a condition of closing of such Sale Transaction, equal to the greater of: (a) $750,000; or (b) one and a half percent (1.5%) of Total Consideration (defined below) up to and including $100 million; plus two percent (2.0%) of Total Consideration over $100 million.

However, in the event that a Sale to Drexel University, or any of its Affiliates,

closes outside of a Chapter 11 bankruptcy proceeding and within one hundred (100) days from the date hereof, then the Sale Fee for such Transaction shall be $250,000. In the event of a Sale to Drexel University in a Chapter 11 bankruptcy proceeding or outside of a Chapter 11 bankruptcy proceeding but after one (100) hundred days from the date hereof, then the Sale Fee for such Transaction shall be $750,000.

In the event of a liquidation of either or both of the operating hospital entities in a

PAHC Chapter 11 bankruptcy proceeding, then SSG shall be entitled to a liquidation fee of $250,000 (“Liquidation Fee”).

e. Restructuring Fee. Upon the closing of a Restructuring Transaction, SSG shall

be entitled to a fee (“Restructuring Fee”) payable in cash, in federal funds via wire transfer or certified check, at and as a condition of closing of such Restructuring Transaction, equal to $750,000.

f. Out-of-Pocket Expenses. In addition to the foregoing Initial Fee, Monthly Fee

and Transaction Fee noted above whether or not a Transaction is consummated, SSG will be entitled to reimbursement for all of SSG's reasonable and documented out-of-pocket expenses (other than any overhead expenses of SSG) incurred in connection with the subject matter of this Engagement Agreement; provided that no expenses in excess of $25,000 in the aggregate will be reimbursed by any Company or the Company Group without the prior written approval thereof.


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14. SSG and the Debtors have agreed pursuant to the SSG Engagement Letter that the

Sale Fee shall be paid to SSG as a direct carve-out from the proceeds of a Sale Transaction or a

Liquidation, prior in right to the rights of any other party.

15. The Fee and Expense Structure described above is comparable to compensation

generally charged by investment banking firms for comparable engagements, both in and out of

court. The Fee and Expense Structure is also consistent with SSG’s normal and customary

billing practices for cases of this size and complexity that require the level and scope of services

outlined. SSG and the Debtors also believe that the Fee and Expense Structure is reasonable and

at favorable market rates.

D. Waiver of Compliance with Requirements Regarding Time Entry Detail

16. SSG’s industry and restructuring experience, its capital markets knowledge,

financing skills, and mergers and acquisitions capabilities, some or all of which may be required

by the Debtors during the term of SSG’s engagement, were important factors in determining the

Fee and Expense Structure. The ultimate benefit to the Debtors of SSG’s services could not be

measured merely by reference to the number of hours to be expended by SSG’s professionals in

the performance of such services. Moreover, the Fee and Expense Structure takes into

consideration SSG’s anticipation that it will need to provide a substantial commitment of

professional time and effort in order to perform its duties under the SSG Engagement Letter, and

in light of the fact that such commitment may foreclose other opportunities for SSG.

17. Because of SSG’s expertise, commitment of resources to this engagement to the

exclusion of other possible employment, and the time that SSG will devote to this engagement,

the Debtors, in the Application, request that the Court approve the Fee and Expense Structure for

SSG pursuant to section 328(a) of the Bankruptcy Code and that the Court evaluate the final


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compensation and reimbursement of expenses in the Chapter 11 Cases for SSG under the

standards of section 328(a) of the Bankruptcy Code, rather than under those of section 330 of the

Bankruptcy Code.

18. SSG will file with the Court a final fee application for allowance of its

compensation and reimbursement of its expenses with respect to services rendered in accordance

with applicable provisions of the Bankruptcy Code, the Bankruptcy Rules, the Local Rules, the

applicable guidelines for compensation and reimbursement of expenses established by the U.S.

Trustee (the “UST Guidelines”), and any applicable orders of the Court. However, it is not the

general practice of investment banking firms to keep detailed time records similar to those

customarily kept by attorneys or to keep time records on a “project category” basis.

Furthermore, SSG’s Fee and Expense Structure provides for a flat fee based on the occurrence of

a Transaction (as defined in the SSG Engagement Letter).

19. As SSG’s compensation will be calculated, depending on the type of transaction

as contemplated by the SSG Engagement Letter, SSG requests that they not be required to file

time records in accordance with Local Rule 2016-2 and the UST Guidelines. Instead,

notwithstanding that SSG does not charge for its services on an hourly basis, SSG nonetheless

will maintain records in half (.50) hour increments (in summary format) of its services rendered

for the Debtors, including descriptions of those services, the time expended in providing those

services and the individuals who provided those services, and will present such records together

with its final and sole fee application filed with the Court.

20. SSG has not shared or agreed to share any compensation to be paid by the

Debtors with any other person, other than other principals and employees of SSG, in accordance

with section 504 of the Bankruptcy Code.


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E. Indemnification

21. The SSG Engagement Letter further provides that the Debtors will indemnify and

hold harmless SSG and its members, partners, officers, agents, employees, and affiliates (each,

an “Indemnified Party,” and collectively, the “Indemnified Persons”), from and against any

and all losses, claims, judgments, liabilities, costs, damages, and expenses, including reasonable

attorneys’ fees that SSG may incur, arising out of any services provided by SSG to the Debtors

in pursuant to the SSG Engagement Letter, other than those resulting from SSG’s gross

negligence or willful misconduct (such obligations being referred to as the “Indemnification

Provisions”), which provisions are set forth in greater detail in the SSG Engagement Letter. The

Indemnification Provisions are standard indemnification terms, both in chapter 11 cases and

outside chapter 11, and reflect the qualifications and limits on such terms that are customary for

SSG and other similar investment bankers as approved in this and other jurisdictions. The

Indemnification Provisions were fully negotiated between the Debtors and SSG at arm’s length

and SSG respectfully submits that the Indemnification Provisions are reasonable.

F. SSG’s Disclosure Policies and Disinterestedness

22. In preparing this Declaration, SSG performed a conflict search with respect to a

list of creditors, equity holders and other interested parties, which is annexed hereto as Schedule

A (the “Potential Interested Parties List”). Based on that search, SSG represents that, to the

best of its knowledge, that it knows of no fact that would present a conflict of interest for SSG

with regard to its proposed engagement. SSG, however, wishes to disclose those items identified

on Schedule B (the “SSG Contacts List”).

23. Insofar as I have been able to ascertain from my review of the SSG Contacts List,

to the best of my knowledge, and other than as described herein, neither SSG, nor its affiliates,


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nor any professional of SSG: (a) has represented the Debtors’ creditors, equity holders, or any

other party in interest, or their respective attorneys and accountants, the United States Trustee, or

any person employed in the office of the United States Trustee, in any matters relating to the

Debtors or their estates; or (b) has any connection with the Debtors in the Chapter 11 Cases, or

any interest materially adverse to the interest of any class of creditors or equity holders by reason

of any direct or indirect relationship to the Debtors, any other parties in interest herein, or their

respective attorneys.

24. SSG has numerous clients, past and present, which are located throughout the

world, in a variety of industries. Such clients may include certain of the persons or entities that

are identified as creditors of the Debtors. It is also possible that some past or present clients of

SSG may have some connection to, or are creditors of, the Debtors. Nevertheless, insofar as I

have been able to ascertain based on the results of the foregoing, to the best of my knowledge,

other than as described herein and except for the Debtors, SSG has not advised any party in

interest in connection with the Chapter 11 Cases.

25. SSG is involved in numerous cases, proceedings, and transactions involving many

different attorneys, accountants, investment bankers, and financial consultants, some of whom

may represent claimants and parties in interest in the Chapter 11 Cases. Moreover, SSG has in

the past, and may in the future, be represented by several attorneys and law firms, some of which

may be involved in the Chapter 11 Cases. Finally, SSG has in the past, and will likely in the

future, be working with or opposite other professionals involved in the Chapter 11 Cases with

respect to matters wholly unrelated to the Chapter 11 Cases. Based on our current knowledge of

the professionals involved in the Chapter 11 Cases and to the best of my knowledge, none of


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these business relationships constitute interests adverse to the estates in matters upon which SSG

is to be employed and none are in connection with the Chapter 11 Cases.

26. The Debtors have numerous creditors and relationships with a large number of

individuals and entities that may be parties in interest in the Chapter 11 Cases. Consequently,

although every reasonable effort has been made to discover and eliminate the possibility of any

conflict including the efforts outlined above, SSG is unable to state with certainty whether any of

its clients or an affiliated entity of a client holds a claim or otherwise is a party in interest in the

Chapter 11 Cases. If SSG discovers any information that is contrary or pertinent to the

statements made herein, SSG will promptly disclose such information to the Court. SSG does

not advise, has not advised, and will not advise any entity other than the Debtors in matters

related to the Chapter 11 Cases. SSG will, however, continue to provide professional services to

entities or persons that may be creditors of the Debtors or parties in interest in the Chapter 11

Cases, provided that such services do not relate to, or have any direct connection with, the

Chapter 11 Cases or the Debtors.

27. Except as otherwise set forth herein and in the Application, to the best of my

knowledge, information, and belief, neither SSG nor any employee of SSG is a creditor, an

equity holder, or an insider of the Debtors. To the best of my knowledge, information and belief,

neither SSG nor any employee of SSG is or was, within two (2) years before the Petition Date, a

director, an officer, or an employee of the Debtors. Also, to the best of my knowledge,

information, and belief neither the undersigned nor the SSG’s professionals expected to assist the

Debtors in the Chapter 11 Cases are related or connected to any United States Bankruptcy Judge

for the District of Delaware, the U.S. Trustee, or any persons employed in the office of the U.S.

Trustee.


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28. As of the date of SSG’s engagement, SSG does not hold any claim against the

Debtors.

29. To the extent SSG discovers any facts bearing on the matters described herein

during the period of SSG’s retention, SSG will undertake to amend and supplement the

information contained in this Declaration to disclose such facts.

30. Based on all of the foregoing, SSG is a “disinterested person” as that term is

defined in section 101(14) of the Bankruptcy Code.

Pursuant to 28 U.S.C. § 1746, I declare under penalty of perjury that the foregoing is true

and correct.

Executed on July 8, 2019 /s/ J. Scott Victor Name: J. Scott Victor


35513537.3 07/17/2019

Schedule A

Potential Parties-in-Interest

Debtors Philadelphia Academic Health System, LLC Philadelphia Academic Medical Associates, LLC St. Christopher’s Healthcare, LLC Center City Healthcare, LLC HPS of PA, L.L.C. TPS II of PA, L.L.C. TPS III of PA, L.L.C. TPS IV of PA, L.L.L. SCHC Pediatric Associates, L.L.C. SCHC Pediatric Anesthesia Associates, L.L.C. StChris Care at Northeast Pediatrics, L.L.C. TPS of PA, L.L.C. St. Christopher’s Pediatric Urgent Care Center, L.L.C. TPS V of PA, L.L.C Non-Debtor Affiliates Front Street Healthcare Properties, LLC Front Street Healthcare Properties II, LLC Broad Street Healthcare Properties, LLC Broad Street Healthcare Properties II, LLC Broad Street Healthcare Properties III, LLC Physicians Clinical Network, LLC Physician Performance Network of Philadelphia, LLC MBNF Investments, LLC American Academic Health System, LLC Philadelphia Academic Health Holdings, LLC Philadelphia Academic Risk Retention Group, LLC HSRE-PAHH I, LLC PAHH New College MOB, LLC PAHH Bellet MOB, LLC PAHH Broad Street MOB, LLC PAHH Feinstein MOB, LLC PAHH Wood Street Garage, LLC PAHH Erie Street Garage, LLC Equity Holders Philadelphia Academic Health Holdings, LLC American Academic Health System, LLC MBNF Investments, LLC Joel Freedman Stella Freedman

Barbara S. Kramer, Trustee Michael Ouzounian Irrevocable Trust Benjamin Joseph Freedman Irrevocable Trust Nathan Alexander Freedman Irrevocable Trust Other Drexel University Drexel University College of Medicine Tenet Business Services Corporation Conifer Revenue Cycle Solutions, LLC Harrison Street Real Estate, LLC Dilworth Paxson LLP Unions District 1199C Service and Maintenance Unit International Brotherhood of Electrical Workers, Local 98 National Union of Hospital and Health Care Employees, AFSCME, AFL-CIO, Pennsylvania Association of Staff Nurses and Allied Professionals Utilities AT&T Mobility Atlantic City Electric Champion Energy Services LLC Comcast Cablevision Constellation Energy Gas Constellation NewEnergy Gas DirectTV LLC Energy Management Systems Inc. MCI Manhattan Telecommunications Corporation d/b/a Metropolitan Telecommunications a/k/a MetTel PECO Energy Philadelphia Gas Works South Jersey Gas SPOK Veolia Energy Philadelphia Inc. Verizon Verizon Business Verizon CABS Verizon Wireless Water Revenue Bureau West Unified Communications


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West Unified Communications SVCS WTMUA Insurers ACE American Insurance Company ACE Property & Casualty Insurance Co. Admiral Insurance Company Affiliated FM Insurance Co. Axis Insurance Company Beazley Insurance Company, Inc. Chubb - Federal Insurance Company Doctors Company An Interinsurance Exch. Illinois Union Insurance Co. Ironshore Specialty Insurance Lloyd's of London Lockton National Fire & Marine Insurance Co. National Union Fire Insurance Company of Pittsburgh, PA Philadelphia Academic Risk Retention Group, LLC Premium Assignment Corporation Starr Indemnity & Liability Company Tokio Marine Specialty Insurance Company Travelers Casualty and Surety Company of America Starr Indemnity & Liability Company Payors Aetna/Coventry Aetna Better Health Amerihealth BCBS Horizon NJ Health Cigna HealthSpring Community Behavioral Health Health Partners Plans Horizon Blue Cross of NJ Humana Independence Blue Cross Independence Blue Cross of PA Keystone First Keystone Mercy Medicaid United Health Care Taxing Agencies Center City District City of Philadelphia Internal Revenue Service Pennsylvania Department of Revenue

Secured Parties Capital One, N.A. GE HFS, LLC Med One Capital Funding, LLC MidCap Funding IV Trust MidCap Funding H Trust MidCap Financial Trust De Landen Financial Services Olympus America Inc. U.S. Bank, N.A. Case Professionals EisnerAmper LLP Omni Management Group Saul Ewing Arnstein & Lehr LLP SSG Advisors, LLC Klehr Harrison Harvey & Branzburg LLP Banks Capital One, N.A. Wells Fargo Bank, N.A. Bank of America, N.A. PNC Bank, N.A. Other Creditors/Contract Parties 12st Catering, Inc. 3E Company Environmental, Ecological and Engineering 3M Health Information Systems, Inc. 50 Words, LLC AA Casa Inc d/b/a PM Associates Aardvark Pest Control Services, Inc. Aargon Agency, Inc. Abbott Laboratories Inc. Abbott Molecular Inc. Abbott Nutrition Abbott Point of Care Abiomed, Inc. ABO Haven Early Learning Center Access Nurse PM, Inc. d/b/a TeamHealth Medical Call Center Accredo Health Group, Inc. Accriva Diagnostics, Inc. Accruent, LLC ACS Education Services, Inc. Ad Prima Charter School ADP, LLC Advanced Air Service Group


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Advanced AV, LLC Advanced CE Advanced Door Services, Inc. Advanced Sterilization Products Services, Inc. Advanced Technologies Group, Inc. Adynxx, Inc. Agilent Technologies, Inc. Alere Informatics, Inc. Allergan USA, Inc. Allergy and Asthma Specialists, PC Alliance for Paired Donation, Inc. Alliance HealthCare Services, Inc. d/b/a Alliance HealthCare Radiology AllMed Healthcare Management, Inc. Alpha Imaging, Inc. Altlantic Diagnostic Laboratories, LLC Amazing Kidz Academy, LLC America On Hold American Academy of Sleep Medicine American College of Cardiology Foundation American College of Cardiology Foundation American College of Radiology American College of Surgeons American College of Surgeons for the Pennsylvania National Surgical Quality Improvement Program Consortium American Communication Centers d/b/a ACC Solutions American Dental Association American Heart Association, Inc. American Medical Response Mid-Atlantic, Inc. American Messaging Services, LLC American Radio and Microwave Corporation Ameriwater, Inc. Amit Maity, MD AMO Sales and Service, Inc. Amy Leader, Dr.P.H., M.P.H. Analytic Solutions Network, LLC Anda K. Kuo, MD Aramark Refreshment Services, LLC Aramark Uniform and Career Apparel Group, Inc. Arizant Healthcare Inc. Arledge Electronics, Inc. Artcraft Promotional Concepts ARUP Laboratories, Inc. Ascension School ASPIRA Bilingual Cyber Charter School ASSA ABLOY Entrance Systems US Inc. ATG Consultants, LLC Athena Diagnostics

Atlantic Lithotripsy, LLC d/b/a Mid-Atlantic Stone Center Atlantic Switch and Generator, LLC Augusta Healthcare, Inc. Aviacode, Inc. Azima Health Services, Inc. Baratz & Associates, PA Barclay Water Management, Inc. Bard Peripheral Vascular, Inc. Barton & Associates, Inc. Battell Memorial Institute Pacific Northwest Division Bayer Healthcare, LLC BC Solutions LLC BC Technical, Inc. Beasley Media Group, Inc. d/b/a WMMR, WMGK, WBEN-FM & WPEN Beckman Coulter, Inc. Beekley Corporation Belfor USA Group Inc. Belimed, Inc. Bellevue Strategies, LLC Best Practice Professionals Inc. d/b/a oneSOURCE Document Management Services Biochrom US Biocompatibles, Inc. BioDlogics, LLC BioFire Diagnostics, LLC bioMerieux Inc. Biomet, Inc. Bio-Optronics, Inc. Bio-Rad Laboratories Biosense Webster, Inc. BiotronX LLC BKT Architects, LLC Blank Rome LLP Blue Pillar, Inc. Bondtech Incorporated Bonel Medical Equipment, Inc. Borton-Lawson Engineering, Inc. Boston Scientific Corporation Brian Communications LLC Brigham and Women's Physicians Organization Brightside Academy Broadcast Music Inc. Bromedicon, Inc. Brucker & Morra, PC Bulldog Orthodontics, LLC Burns White LLC Calyx Partners, LLC


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Capstar Radio Operating Company d/b/a iHeart Medica, Philadelphia Cardeza Foundation Hemophilia and Thrombosis Center Cardinal Health 200, LLC Cardinal Health 414, LLC Cardinal Health Solutions, Inc. CardioAccess, Inc. Cardiology Consultants of PA, PC CardioNet, Inc. CareFusion 211, Inc. CareFusion Solutions, LLC CarterPierce, LLC Casa del Carmen CCJ Physics, LLC Cenova, Inc. Center City Film and Video, Inc. Center for Student Learning Charter School at Pennsbury Centric Actuarial Solutions, LLC Cepheid Incorporated Cerner Corporation Cetlin Design Group, Inc. Champion Energy Services, LLC Change Healthcare Technologies, LLC Charley's Angels Photography Inc. CHG Companies, Inc. d/b/a CompHealth Chubb Hotel & Conference Center Cincinnati Children's Hospital Medical Center Cintas Corporation CIOX Health, LLC Cisco Systems Capital Corporation CL Risk Solutions, LLC Clark Services Group, LLC d/b/a The Degreasers Coast Quality Pharmacy, LLC d/b/a AnazaoHealth Cocco Enterprises, Inc. Cochlear Americas CohnReznick LLP Colcom, Inc. Coleman Nourian Search LLC College of American Pathologists Coloplast Corp. Columbia University Medical Center Community Behavioral Health Computer Kids Day Care Center Concilio Congresso DeLatinos Unidos, Inc. CONMED Corporation Connolly Gallagher LLP

Conrad O'Brien PC Constellation NewEnergy - Gas Division, LLC Continuum, LLC ConvergeOne Systems Integration, Inc. Corona Partners Corporate Cost Control, Inc. Corporate Lamp and Electric Recycling LLC Council on Accreditation of Nurse Anesthesia Educational Programs Courtyard Philadelphia Downtown Covidien Sales LLC d/b/a Given Imaging Cranel, Inc. d/b/a Versitec Criterion Laboratories, Inc. Crothall Healthcare, Inc. Crowell & Moring LLP Cushman & Wakefield of Connecticut, Inc. Cushman & Wakefield of Pennsylvania, LLC Cushman & Wakefield of Philadelphia, Inc. CyraCom International Inc. Dako North America, Inc. Daniel Burke Photography David Small DaVita Healthcare Partners Inc. De Lage Landen Financial Services, Inc. De Long Industries Group, Inc. d/b/a Wavetech Industries Deaf Hearing Communication Centre, Inc. Delaware Valley Aesthetics d/b/a Rumer Cosmetic Surgery Delta Dental of Pennsylvania Devicor Medical Equipment, Inc. Devicor Medical Products, Inc. Devil's Alley DEX Imaging, Inc. DGA Partners, Inc. Diagnoss Inc. Diagnostica Stago, Inc. Diesel Dialysis, LLC Digital Innovation, Incorporated DIRECTV, Inc. Dixon Hughes Goodman LLP DJO, LLC Dolbey-Jamison, Inc. Dome Insulation, LLC Draeger Medical, Inc. Draeger, Inc. Drexelbrook Drueding Center Duff & Phelps, LLC Dynamic Language Services, LLC e4 Services, LLC


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Eagles Taxi, LLC d/b/a 215 Get a Cab Eastern Controls Inc. Eastern Lift Truck Co., Inc. Eastern Sign Tech, LLC Eastern Society for Pediatric Research Echo, Inc. Eckert Seamans Cherin & Mellott, LLC Econsult Solutions, Inc. Education Resources, Inc. Edwards Lifesciences LLC EEC Acquisition LLC d/b/a Smart Care Equipment Solutions Einstein Practice Plan, Inc. Electronic Ink Electronic Payment Exchange Electronic Security Solutions LLC Elekta Inc. Elemental Inc. Elite Office Solutions, Inc. EMD Millipore Corporation Emergency Systems Service Company Employers Health Network, LLC Emergency Medical Associates Employment Tax Servicing Corp. d/b/a Emptech Encore Medical International, Inc. Energy Products and Service Co., Inc. Enerwise Global Technologies, Inc. d/b/a CPower Enovate Medical, LLC Ensemble RCM LLC d/b/a Ensemble Health Partners Entercom ENV Services, Inc. Environmental and Engineering Solutions, Inc. Environmental Control Services, Inc. Ernst & Young LLP Essential Consulting LLC Ethan Kentzel ettain group, Inc. Eurofins Viracor, Inc. Eurofins VRL, Inc. d/b/a VRL Eurofins Everbridge, Inc. Evoqua Water Technologies, LLC Evoqua Water Technologies, LLC Exactech US, Inc. Fairmount Long Term Care Fairmount Rowing Association Field House Philly Financial Recoveries FIRM Revenue Cycle Management Services, Inc.

First Philadelphia Charter School for Literacy First Philadelphia Paradigm, Tacony Academy FishHeads Aquarium Service LLC Flex Financial, a divison of Stryker Sales Corporation FM Cost Containment, LLC Focus Diagnostics, Inc. Fonemed, LLC Foot & Ankle Center of Philadelphia, LLC Foss Therapy Services, Inc. Francis Cauffman, Inc. Franklin Cleaning Equipment & Supply Company Fresenius Medical Care Fusaro Brothers, Inc. d/b/a Maxwell Cab Company Future IT Advisors, LLC Garda CL Atlantic, Inc. Garrison Printing Company Gary Frazier GBS Corp GE Healthcare IITS USA Corp. GE HFS, LLC GE Medical Systems Information Technologies, Inc. GE Precision Healthcare LLC GeBBS Healthcare Solutions, Inc. General Electric Company, by and through its GE Healthcare division General Healthcare Resources, LLC Genova Group, LLC Geo. W. Kistler, Inc. d/b/a Kistler O'Brien Fire Protection Germane & Co., Inc. d/b/a Germane Solutions Getinge USA Sales, LLC Getinge USA, Inc. GlassRatner Advisory & Capital Group, LLC Global Affiliates, Inc. Global Healthcare Exchange, LLC Greater Delaware Valley Society of Transplant Surgeons d/b/a Gift of Life Donor Program GTT Americas, LLC H.C.A.S. of Florida, Inc. d/b/a Call 4 Health / Call 4 Nurse Haemonetics Corporation Hahnemann Apothecary Inc. Hanger Prosthetic and Orthotics, Inc. d/b/a Hanger Clinic Harmelin and Associates Inc. d/b/a Harmelin Media Harry J Lawall & Son, Inc.


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Hayes Healthcare, LLC HBO & Recoveries, LLC Health Sciences Law Group LLC Healthcare Administrative Partners, LLC Healthcare Performance Group, Inc. Healthcare Receivable Specialists, Inc. Healthshare Exchange of Southeastern Pennsylvania, Inc. HealthStream, Inc. HealthTronics Mobile Solutions, L.L.C. HealthTrust Purchasing Group, L.P. Health Partners Plans HemaTechnologies, Inc. Herman Goldner Co., Inc. Hewlett-Packard Financial Services Company Hillmann Consulting, LLC Hill-Rom Company, Inc. Hilton Philadelphia City Avenue Historic Hotel Bethlehem HMI LLC Holland Square Group, LLC Hollis Cobb Associates, Inc. Hologic, Inc. Hospice of Philadelphia Howmedica Osteonics Corp. HUB Parking Technology USA, Inc. Huntingdon Valley Eye Care Consultants, Ltd. Huntington Technology Finance, Inc. Huron Consulting Services LLC I. Miller Precision Optical Instruments, Inc. iContracts, Inc. IMA Consulting Immaculata University Immucor, Inc. IMPAC Medical Systems, Inc. IMPACT Services Corporation Implementation Management Assistance, LLC d/b/a Revint Solutions Independent Hardware, Inc. Infor (US), Inc. Informa Software Ingenious Med, Inc. Innovative Print & Media Group, Inc. Innovative Product Achievements, LLC d/b/a IPA, LLC INO Therapeutics LLC d/b/a Mallinckrodt Inquicker, LLC Integra Life Sciences Sales LLC Integrated Healthcare Solutions, Inc. Integrated Medical Systems International, Inc. Integrity Healthcare, LLC

Interactivation Health Networks Interphase Medical Equipment, Inc. Intralinks, Inc. Intuitive Surgical, Inc. Iodine Software, LLC Iron Mountain Information Management, LLC ISS Facility Services, Inc. ivWatch, LLC Ivy Hill Cemetery Company J.W. Carrigan, LLC Jackson Lewis P.C. Jay M. Yanoff, EdD JDI Net Systems JDR Consulting, LLC Jefferson Gardens North Philadelphia Head Start Joe Glass John B. Stetson Middle School John Calvitti Company John Dowdle JohnGSelf Partners, Inc. Johnson & Johnson Health Care Systems Inc. JohnsonLambert LLP JP Zimmerman PCS LLC JustRight Surgical, LLC K&C Strategic Policy Group, LLC d/b/a DeBrunner & Associates Karl Storz Endoscopy-America, Inc. Kasscon Building Services, LLC KCI USA, Inc. Kenco Kalibration Inc. Ken-Crest Services Keystone Academy Charter School Keystone Quality Transport Company Kieran McKenna Flooring, Inc. Kinder Academy Klenzoid, Inc. Konica Minolta Healthcare Americas, Inc. Korn/Ferry International Laboratory Corporation of America Laerdal Medical Corporation Language Services Associates, Inc. Lantheus Medical Imaging, Inc. Laser Service Solutions, LLC Lauletta Birnbaum, LLC Law Offices of Suzanne N. Pritchard, P.C. Le Boeuf Holdings, Inc. d/b/a Jim's Enterprises Leah Coppolino Leasing Associates of Barrington, Inc. Legal Clinic for the Disabled, Inc. Leucadia Pharmaceuticals Life Image Inc.


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LifeLine Software, Inc. Lighthouse Limb Technologies, Inc. d/b/a LTI Orthotic Prosthetic Center Linde LLC LinkedIn Corporation Lions Eye Bank of Delaware Valley Lisa The Litchfield Cavo LLP Livanta LLC Live Message America Lockton-Dunning Series of Lockton Companies, LLC LocumTenens.com, LLC Lori's Gifts, Inc. LRD Graphics, Inc. t/a Fels Printing Lumedx Corporation Lutheran Children and Family Service Lutheran Settlement House Lyons Advisors, LLC M&M Autoclave Cleaning, LLC Macalino Marketing, Inc. Magee Rehabilitation Hospital Maggiano's Little Italy Major Medical Hospital Services, Inc. Manhattan Telecommunications Corporation d/b/a Metropolitan Telecommunications a/k/a MetTel Mar Cor Purification, Inc. Marcum LLP Marshall Dennehey Warner Coleman & Goggin, P.C. Mastery at Smedley Charter School Mayflower Laundry and Textile Services LLC MCG Health, LLC MDS Carpeting and Flooring, Inc. Med One Capital Funding, LLC Med One Capital Funding, LLC d/b/a IPA One MED3000 Inc. Medacist Solutions Group, LLC MedHub, LLC MediaLab, Inc. Medical Doctor Associates, LLC Medical Excess LLC Medical Gas Solutions, Inc. Medical Neurogenetics, LLC Medical Staffing Solutions, Inc. d/b/a STAT RESOURCES medInt Holdings, LLC Medline Industries Holdings, L.P Medline Industries, Inc.

Medlytix, LLC Medsentrix, LLC Med-Tex Services, Inc. Mednet Healthcare Technologies, Inc. Medtronic USA Inc. Mentor Worldwide LLC Merchants Association Collection Division, Inc. Mercy Neighborhood Ministries of Philadelphia, Inc. Meridian Bioscience Corporation Metropolitan Anesthesia Services, Inc. MHC Software, LLC Mindfigure Consulting Mindray DS USA, Inc. MiraMed Global Services, Inc. MJR Technologies, Inc. d/b/a GT Telecom Moira Brooks Monterey Medical Solutions, Inc. Mother of Divine Grace PN MSW Enterprises Inc. d/b/a Newtown Answering Service Muzak LLC d/b/a Mood Media Nancy West Communications Nanosonics, Inc. Nathan Freedman National Marrow Donor Program Natus Medical Incorporated NAVEX Global, Inc. Neff and Associates, Inc. Neopost Inc. Network of Victim Assistance, LLC Neurosurgical Anesthesia Consulting New Foundations Charter School New Innovations, Inc. New York Blood Center, Inc. Nexcore Properties PA LLC Nixon Uniform Service, Inc. Norris Square Children's Center Northeast Protection Partners Inc. Nova Biomedical Corporation Nova Capital Group, LLC nThrive Revenue Systems, LLC nThrive, Inc. NTT DATA Services, LLC Nuance Communications, Inc. Nuclear Medicine Resources, Inc. Obermayer Rebmann Maxwell & Hippel LLP Occupational Health Centers of the Southwest, P.A. d/b/a Concentra Medical Centers Office of Civic Engagement & Volunteer Services' Foster Grandparent Program


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Ohio Children's Hospital Solutions for Patient Safety Olympus America Inc. Omnicell, Inc. Omnigo Software On Time Ambulance, Inc. Optum360 Solutions, LLC Oregon Health & Science University Ortho-Clinical Diagnostics, Inc. OrthoPediatrics US Distribution Corporation OsteoMed, LP Otech Group LLC Outcome Health Pan American Academy Charter School Pandora Data Systems, Inc. Paradigm Mechanical, LLC Park America, Inc. ParkingSoft, LLC Parkway Corporation Patient Pathways, LLC Patino Landscaping Group, LLC Paul Rabinowitz Glass Co., Inc. Paul Tirado PayTech, Inc. PCA EmSTAR Holdings, LP d/b/a EmSTAR Pediatric Rehabilitation Associates, LLC Penn Environmental & Remediation, Inc. Pennoni Associates Pennsylvania Department of Health, Chronic Renal Disease Program Pennsylvania Oral & Maxillofacilal Surgery, Ltd. Pennsylvania Trauma Systems Foundation Pentec Health, Inc. People for People Charter School People's Capital and Leasing Corp. Pepper Hamilton LLP PeriGen, Inc. Perioperative Services, LLC PERITUS Advisors PerkinElmer Genetics, Inc. Pharmacy OneSource Inc. Philadelphia Business Journal Philadelphia Ear, Nose & Throat Associates Philadelphia Parent Child Center Philadelphia Urosurgical Associates, PC Philips Healthcare Philips Medical Capital, LLC Philly Star Events Physician and Tactical Healthcare Services LLC Pinnacle Healthcare Recovery Partners, Inc.

Pitney Bowes Inc. Please Touch Museum PNC Bank, National Association Poovendran Sanththasivam, MD Pope John Paul II Regional School Porter's Family Center Practising Law Institute Precision Laser Specialist, Inc. Precision Sprinkler Services, Inc. Premier, Inc. Preschool Project, Woolston Prescient Logistics, LLC d/b/a RepScrubs Prescott's Inc. Press Ganey Associates, Inc. Prestige Medical Imaging, Inc. Prestige Perfusion, LLC Primmer Piper Eggleston & Cramer PC Priority Express Courier, Inc. Professional Trauma Services, LLC Proserv Removal, Inc. d/b/a 1-800-Got-Junk ProviderTrust, Inc. Pruett Roof PTW New York Corporation Public Health Management Corporation Puppet Kitchen International, Inc. Quality Insights Renal Network 4 Quantros, Inc. Quest Diagnostic Clinical Laboratories Inc. Quest Diagnostics Infectious Disease, Inc. Quidel Corporation R. Smith International, LLC d/b/a Resource Rad Source Technologies, Inc. Radiology Solutions, LLC Radiometer America Inc. Randstad Professionals US, LLC d/b/a Tatum RealMed Corporation Recognition Advantage, LLC Red Shield Family Shelter Reed Smith LLP Reese's Professional Cleaning Service, LLC Renal Treatment Centers - Northeast, Inc. Respiratory Associates, LTD Reuter Hanney Inc. Richard N. Best Associates, Inc. Ricoh USA, Inc. Risa Eichinger Rittenhouse Hematology & Oncology Robert DiNunzio d/b/a Hygienic Building Services Robinson Kirlew & Associates Attorneys at Law Romed, Inc. d/b/a Romed Ambulance


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S&H Ltd. d/b/a Metropolitan Flag & Banner Co. S.A. Comunale Co., Inc. S.R. Wojdak & Associates, LP d/b/a Wojdak Government Relations SAI Global Compliance, Inc. ScanSTAT Technologies, LLC Scientific Apparatus Service, Inc. Scott Testing Inc. Scribe Care, Inc. ScribeAmerica, LLC SeaSpine Sales LLC Security and Data Technologies, Inc. Share Food Program Inc. Sharonda Brown SHC Services, Inc. d/b/a Supplemental Healthcare Company Sherman Engineering Company Shore Memorial Hospital d/b/a Shore Medical Center Shriners Hospitals for Children Sickle Cell Disease Association of America Philadelphia/Delaware Valley Chapter Siemens Healthcare Diagnostics, Inc. Siemens Industry, Inc. Siemens Medical Solutions USA, Inc. Simkar Corporation Simon Gratz Mastery Charter School Singletary Group Inc. d/b/a First Contact HR SISCO, Inc. Sky Nurses, LLC SleepMed Incorporated Smith & Nephew, Inc. Smokin' Betty's SMR Healthcare Management, Inc. Sodexo Management, Inc. Solid Waste Services Inc. d/b/a JP Mascaro and Sons Sorin Group USA, Inc. SourceHOV Healthcare, Inc. Southampton Window Cleaning & Janitorial Services, Inc. Southeast Reimbursement Group, LLC Southwest Regional PCR, LLC d/b/a PathoGenius Laboratory SpecialtyCare IOM Services, LLC SpecialtyCare, Inc., as agent for SpecialtyCare Cardiovascular Resources, Inc. Spectra Laboratories, Inc. Spectrum Health Partners, LLC Spiffy Cloud Inc. SPIN at Frankford

Spok, Inc. SportWorx, Inc. Spreemo, Inc. St. Bernard PN St. Christopher's Foundation for Children St. Christopher's Healthcare, LLC St. Elizabeth North Philadelphia Headstart St. Helena School St. James School St. Martin de Porres School Staff Care, Inc. Standard Register Company, The Stanford/Sterling Group, LLC State of the Art Medical Products, Inc. Stericycle, Inc. Steris Corporation Storage Solutions Technology Group, Inc. d/b/a SST Group, Inc. Strassheim Graphic Design & Press Corp. Stryker Flex Financial Stryker Neurovascular Stryker Sales Corporation Sun Nuclear Corporation Sunquest Information Systems, Inc. Sunrise Support Services Synergy Orthopedics, LLC Sysmex America, Inc. Systematech Technical Management Services, Inc. d/b/a InDemand Interpreting T. Cruse Design Tab Service Company TC Human Capital Solutions, LLC Teleflex Medical Incorporated Telehealth Services Tenet Business Services Corporation Terumo BCT, Inc. Thanks for Being Green, LLC d/b/a Magnus Computer Recycling The Academy of Natural Sciences of Drexel University The Advisory Board Company The American National Red Cross, Penn Jersey Region The Anesthesia Quality Institute The Bancorp Bank The Bettinger Company, Inc. The City of Philadelphia Fire Department The Coding Network, LLC The Communication Connection The Cooper Health System The Johns Hopkins University


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The Leapfrog Group The Otis Elevator Company The Phillie Phanatic The Society of Thoracic Surgeons The Spectranetics Corporation The Starlight Starbright Children's Foundation International The StayWell Company, LLC The Visiting Nurse Association of Greater Philadelphia Therapath, LLC Thomas, Thomas & Hafer LLP thyssenkrupp Elevator Corporation Tipton Communications Group, Inc. Titan Health Management Solutions, Inc. Toshiba America Medical Systems, Inc. Total Package Express Inc. d/b/a One Hour Messengers Total Renal Care, Inc. Tozour Energy Systems, Inc. Tractmanager, Inc. d/b/a Meditract Trans Union LLC Translate Medical Translogic Corporation d/b/a Swisslog Healthcare Solutions Transworld Systems Inc. Trinity Biotech, Inc. Trinity Mission Critical, LLC TriReme Medical LLC Trisonics, Inc. UMS Lithotripsy Services of Greater Philadelphia, LLC UMS MR Fusion Services of Eastern PA, LLC Universal Digital Resources Universal Hospital Services, Inc. Universal Protection Service, LP d/b/a Allied Universal Security Services University of Kansas Medical Center Research Institute, Inc. University Pipette Services, Inc. UPMC Benefit Management Services, Inc. d/b/a WorkPartners UpToDate, Inc. Urban Village Brewing Company Urologic Consultants of Southeastern Pennsylvania Urologic Surgeons, Inc. Urology for Children, LLC US Regional Occupational Health II, PC d/b/a WORKNET U.S. Bank, N.A.

Unique Pharmaceuticals Ltd. US Security Associates, Inc. USA-Clean, Inc. Van Hong Nguyen Vanguard Cleaning Systems, Inc. d/b/a Vanguard Cleaning Systems of Philadelphia Vapotherm, Inc. Varian Medical Systems Veolia Energy Philadelphia, Inc. Verathon Inc. Vericom VIE Healthcare, Inc. Virtual Imaging, Inc. Vision Quest National Limited Visitation School Vitalant Vizient, Inc. VOYCE, Inc. VP-MA Health Solutions, Inc. d/b/a CDIMD Vyera Pharmaceuticals, LLC Warren Technology, Inc. Watts Restoration Co., Inc. Watts Restoration Co., Inc. Wayne Moving and Storage Company Weatherby Locums, Inc. Web.com Group, Inc. Webbcam LLC Weber Gallagher Simpson Stapleton Fires & Newby, LLC Welcome America, Inc. Wells Fargo Commercial Mortgage Werfen USA LLC West Health Advocate Solutions, Inc. West Interactive Services Corporation West Physics Consulting, LLC West Unified Communications Services, Inc. Whitecap Health Advisors, LLC Wolters Kluwer Clinical Drug Information, Inc. Women Against Abuse, Inc. WomenCertified Inc. Woodstock Family Center - OESS X-Change Dialysis, Inc. Xerox Corporation Yard Truck Specialists, Inc. Young Achievers Learning Center Zimmer Biomet CMF & Thoracic, LLC Zimmer US, Inc. Certain Litigation Parties 1199C, NUHHCE


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1526 Lombard Street SNF Operations LLC d/b/a Powerback Rehabilitation AAHS, LLC All About Women Altus Group U.S., Inc. American Academic Health System, LLC American Academic Health System, LLC, d/b/a Hahnemann University Hospital American Academic Health System, LLC, d/b/a St. Christopher’s Hospital for Children Amrom, George, M.D. Antony, Mary Atlantic Specialty Insurance Company Bailey, Paul, M.D. Barrett, Nathan , Sr. Beard, Jeffrey Beck, Charles, as Legal Guardian of Isaiah Beck (an adult) Bell, Scherise Benefit Fund for Hospital and Health Care Employees Bennett-Ryder, Martha, Administratrix of the Estate of Virginia Smith Boyd, Kenneth Briggs, Alyssa (minor), by and through her parents Joshua Briggs and LeeAnne Raccagno Broad Street Healthcare Properties, LLC Broad Street Healthcare Properties II, LLC Broad Street Healthcare Properties III, LLC Buggy, Donna, R.N. Bureau of Labor Law Compliance Burns, Sarah K., M.D. Center City Healthcare, LLC Center City Healthcare, LLC, d/b/a Hahnemann University Hospital Center City Health Care Associates, P.C. Childs, Michael City of Philadelphia Clark, Maureen, D.O. Clinical Care Associates of Univ of Penn Health Care System Combs, Candes Cooper, April Cooper, Shontelle, M.D. Corizon Health, Inc., t/a Prison Health Services, Inc. Daniels-Iannucci, Lynsey, M.D. DeValia, Laverne (Executive Director) Devereaux, Courtney, Administratrix of the Estate of Alise Adams-Allen Delvadia, Dipak, D.O.

Deveaux, Richard, M.D. Diaz, Gregory Drexel College of Medicine Drexel Medicine Drexel Neurosciences Institute Drexel Surgical Associates Drexel University Drexel University College of Medicine Earley, Melissa Edmondson, Madern Envision Physician Services North Division, a/k/a EmCare North Division Felbaum, Daniel, M.D. Feldman, Cheryl (Executive Director) Fleming, Althea Freedman, Joel Front Street Healthcare Properties, LLC Future IT Advisors, Inc. Galvez, Alvaro, M.D. Global Excel Management, Inc. Global Neurosciences Institute Gray, Juanita Green, Seika Lee Gruber, Eric, M.D. Hahnemann Orthopedic Associates, LLC Hahnemann Orthopedic Associates, P.C. Hahnemann University Hospital Halley, Kadyjah Harrell, Tyron Hospital of University of Pennsylvania IHC Administrative Services, Inc. IHC Health Solutions Innovative Medical Risk Management, Inc. Johnson, Robert Khalili, Marina, M.D. Lemons, Eric, as Executor of the Estate of Maria Lemons Leone, Joelle Lewis, Emma, Individually and as Administratrix of the Estate of Lynn Lewis Rebecca Maneval, Lisa Rebecca, CRNP Marcucci, Michael, M.D. Mastrangelo, John McFadden, Phyicia Mercy Health System of Southeastern PA Morgenstern, Ricardo, M.D. Murphy, John, M.D. Nazareth Hospital Nunez, Alberto, M.D. PAHH PAHS, LLC


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Packer, Marci Packer, Steven Paladin Healthcare Paladin Healthcare Capital, LLC Park America, Inc. of PA Parker, Jason, D.O. Parkway Corporation Patel, Sonaly, M.D. Penn Medicine at Bucks County Penn Medicine, c/o the Trustees of the University of Pennsylvania Health Care System Penn Radiology Bucks County Pennsylvania Association of Staff Nurses and Allied Professionals Pension Fund for Hospital and Health Care Employees – Philadelphia and Vicinity Philadelphia Academic Health System, LLC Philadelphia Academic Medical Associates, LLC Philadelphia Hand Center, P.C. Philadelphia Hospital & Health Care Employees – District 1199C Training and Upgrading Fund Philadelphia Human Rights Commission Physicians Clinical Network, LLC Porter-Robinson, Cassandra Pratta, Steven, PA-C R.V., a minor, by Kira and David Voelker Reading Hospital Reid, Shari, M.D. Renza-Singhone, Elizabeth, M.D. Richards, Suzanne Rivera, Loraine Rogers, Marquita Rydal Square Saechow, Pamela Schwartz, Roy, M.D. Schwedhelm, Thomas, M.D. SD Real Estate Developers, LLC Shaikh, Mohammad, M.D. Shields, Corinthia Sloan, David Smith, Sharae SMR Healthcare Management, Inc. Standard Security Life Insurance Company of New York Steckler, Robert E., M.D. Steese-Prisco, Marcella Stone, Sherry Taras, John, M.D. Teichman, Amanda, M.D. Tenet Business Services Corporation, Inc.

Tenet Healthcare Corporation Tenet HealthSystem Hahnemann, LLC Tenet HealthSystem St. Christopher’s Hospital for Children, LLC Thompson, Jennifer, CNM Tower Health Tower Health Medical Group Trinity Health Corp. Trustees of University of Pennsylvania U.S. Equal Employment Opportunity Commission Weinbaum, Paul, M.D. Williams, Lana Winn, Michael Xiao, Gary, M.D. Delaware Bankruptcy Judges and Clerk of the Court Carey, Kevin J. Dorsey, John T. Gross, Kevin Owens, Karen B. Shannon, Brendan L. Silverstein, Laurie Selber Sontchi, Christopher S. Walrath, Mary F. O’Boyle, Una U.S. Trustee's Office, District of Delaware Attix, Lauren Buchbinder, David Casey, Linda Dice, Holly Dortch, Shakima L. Fox, Jr., Timothy J. Giordano, Diane Green, Christine Hackman, Benjamin Heck, Jeffrey Leamy, Jane McCollum, Hannah M. O’Malley, James R. Panacio, Michael Richenderfer, Linda Sarkessian, Juliet Schepacarter, Richard Serrano, Edith A. Starr, Karen Tinker, T. Patrick Vara, Andrew


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Vinson, Ramona Weissgerber, Jaclyn Wynn, Dion


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Schedule B

SSG Contact List

1. SSG has worked on numerous other unrelated matters with Saul Ewing, counsel for the Debtors;

2. SSG has worked on numerous other unrelated matters with Klehr Harrison, counsel for the Debtors;

3. SSG has worked on numerous other unrelated matters with Stradley Ronon, counsel to MidCap Financial;

4. SSG has worked on numerous other unrelated matters with Cozen O’Connor, counsel to Drexel University;

5. SSG has worked on numerous other unrelated matters with Omni Management Group, claims agent for the Debtors;

6. Dr. Mark F. Victor, the brother of SSG’s Founding Partner and Managing Director, J. Scott Victor, is a managing partner of Cardiology Consultants of PA, P.C., a contract party;

7. Dr. Mark F. Victor, the brother of SSG’s Founding Partner and Managing Director, J. Scott Victor, is an honorary member of the Physician Executive Board of Hahnemann University Hospital; and

8. SSG Founding Partner and Managing Director, J. Scott Victor is a non-managing limited partner in a real estate partnership, VDM Associates, L.P., that is a landlord to SCHC Pediatric Associates, LLC, a Debtor physician group at St. Christopher’s Hospital for Children.


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Exhibit C

SSG Engagement Letter


Five Tower Bridge, Suite 420 • 300 Barr Harbor Drive • West Conshohocken, PA 19428

Phone: (610) 940-1094 • Fax: (610) 940-3875 www.ssgca.com

June 7, 2019 Mr. Joel Freedman Chief Executive Officer and President Philadelphia Academic Health Holdings, LLC Philadelphia Academic Risk Retention Group, LLC Philadelphia Academic Health System, LLC 1500 Market Street, 24th Floor West Tower, Centre Square Philadelphia, PA 19102 Dear Mr. Freedman: This agreement (“Engagement Agreement”) will serve as the contract between Philadelphia Academic Health Holdings, LLC (“PAHH”), Philadelphia Academic Risk Retention Group, LLC (“RRG”), Philadelphia Academic Health System, LLC (“PAHS”), and PAHS’s wholly owned subsidiaries (such subsidiaries, together with PAHS, the “PAHS Group” and the PAHS Group collectively with RRG and PAHH, the “Company Group” and any entity in the Company Group, a “Company”), and SSG Advisors, LLC ("SSG") regarding the retention of SSG as exclusive investment banker to the Company Group for the purposes outlined in this Engagement Agreement with J. Scott Victor leading the engagement. SSG’s responsibilities hereunder involve providing investment banking services to the Company Group, focusing on: (i) the private placement of debt and/or equity capital (the “Financing”); and/or (ii) the sale of all or part of the Company Group (the “Sale”), and/or (iii) the restructuring of the Company Group’s balance sheet with existing stakeholders (“Restructuring” and, together with a Financing or Sale, a “Transaction”) and shall be effective as of May 31, 2019.

A. SSG’s Role:

1. In regard to the Financing, the following:

Prepare an information memorandum describing the Company

Group, or any part thereof, as applicable, its historical performance and prospects, including existing contracts, patient census information, medical services offered, medical, nursing and staff information, management, and financial projections;

Assist the Company Group in compiling a data room of any necessary and appropriate documents related to the Financing;

Assist the Company Group in developing a list of suitable potential lenders and investors who will be contacted on a discreet and confidential basis after approval by the Company Group;


Mr. Joel Freedman June 7, 2019 Page 2

Coordinate the execution of confidentiality agreements for potential lenders and investors wishing to review the information memorandum;

Assist the Company Group in coordinating site visits for interested lenders and investors and work with the management team to develop appropriate presentations for such visits;

Solicit competitive offers from potential lenders and investors;

Advise and assist the Company Group in structuring the Financing and negotiating the Financing agreements;

Otherwise assist the Company Group and its other professionals, as

necessary, through closing on a best efforts basis.

2. In regard to the Sale, the following:

Prepare an information memorandum describing Company Group, or any part thereof, as applicable, its historical performance and prospects, including existing contracts, patient census information, medical services offered, medical, nursing and staff information, management and anticipated financial results of the Company Group;

Assist the Company Group in developing a list of suitable potential

buyers for specific assets of the Company Group who will be contacted on a discreet and confidential basis after approval by the Company Group;

Assist the Company Group in compiling a data room of any

necessary and appropriate documents related to the Sale;

Coordinate the execution of confidentiality agreements for potential buyers wishing to review the information memorandum;

Assist the Company Group in coordinating site visits for interested

buyers and work with the management team to develop appropriate presentations for such visits;

Solicit competitive offers from potential buyers;

Advise and assist the Company Group in structuring the Sale and

negotiating the Sale agreements, including, without limitation, advising and negotiating with respect to Sale structures that include, as may be necessary or desirable, licenses or assignments of intellectual property and leasing arrangement of GME/IME caps/slots;

Otherwise assist the Company Group, its attorneys and accountants,

as necessary, through closing on a best efforts basis.



3. In regard to the Restructuring, the following:

SSG, on a best effort basis, shall assist the Company Group in any negotiation with various stakeholders (the “Existing Stakeholders”), including, but not limited to any of the Company Group’s lenders, creditors, strategic partners and/or other stakeholders in regard to a possible Restructuring Transaction of existing claims and equity;

Complete all necessary and appropriate valuations in connection with any Company conversion from a for-profit entity into a not-for-profit entity;

Assist the Company Group in compiling a data room of any

necessary and appropriate documents related to the Restructuring.

In performing the services described above, the Company Group will furnish or cause to be furnished to SSG such written information as SSG requests that SSG reasonably believes appropriate to the execution of its engagement hereunder (all such written information so furnished being the "Information"). The Company Group represents to SSG that (a) all factual Information (other than the Projections (as defined below) and information of a general economic or industry-specific nature) furnished by it or its agents (but not any persons or entities who are not Affiliates (as defined in Rule 405 under the Securities Act of 1933, as amended) of any Company) will be complete and correct in all material respects, when taken as a whole, as of the date on which it is furnished or as of the date indicated in such Information, to its actual knowledge, (b) the written projections, budgets, estimates, forward-looking statements or information of a forward-looking nature (collectively, the “Projections”) will be prepared in good faith based on assumptions believed by the Company Group to be reasonable at the time made (it being understood and agreed that (i) such Projections are (A) not to be viewed as facts or a guarantee of performance or results) and (B) subject to significant uncertainties and contingencies many of which are beyond the Company Group’s control and (ii) no assurance can be given that any particular Projections or the Projections taken as a whole will be realized, and that actual results during the period or periods covered by any such Projections may differ from the projected results, and such differences may be material); and (c) until the expiration of SSG’s engagement hereunder, it will use commercially reasonable efforts to promptly advise SSG of the occurrence of any event or any other change known by it or its agents (but not any persons or entities who are not Affiliates) that results in the factual Information (other than the Projections and information of a general economic or industry-specific nature) ceasing to be complete and correct in all material respects, when taken as a whole, as of the date on which it is furnished or as of the date indicated in such Information. The Company Group recognizes and confirms that SSG: (a) will use and rely primarily on the Information and on information available from public sources that are generally recognized as reliable in performing the services contemplated hereby without having independently verified any of the same; (b) does not assume responsibility for accurateness or completeness of the Information and such other information; and (c) will not make an appraisal of any of the assets or liabilities of the Company Group except as set forth above in connection with the Restructuring valuations.



The Company Group agrees that SSG shall be its exclusive investment banker in connection with a Financing or Sale undertaken with respect to the Company Group during the Engagement Term, as defined below. the Company Group agrees to use its commercially reasonable efforts to identify to SSG: (a) all prospective purchasers and investors who have been in contact with the Company Group during a six-month period prior to the date hereof and (b) all prospective purchasers and investors who come in contact with the Company Group during the Engagement Term.

SSG will consult with and advise the Company Group with respect to the financial and other aspects of any proposed Transaction, including price, timing, structure, other terms and conditions of a Transaction. SSG will not, however, have any authority to bind the Company Group or any Company with respect to any proposed Transaction. Likewise, nothing contained herein shall require the Company Group or any Company or any members thereof to accept the terms of any proposal and the Company Group and each Company shall at all times have the right in its sole and absolute discretion to reject any proposed Transaction regardless of the terms proposed.

B. SSG’s Compensation

As compensation for providing the foregoing services, SSG shall receive the following: 1. Initial Fee. An initial fee (the “Initial Fee”) equal to $50,000 due upon

acceptance of this Engagement Agreement by the Company Group; SSG hereby acknowledges that it has received the Initial Fee on June 5, 2019.

2. Monthly Fees. A monthly fee (the “Monthly Fee”) of $50,000 per month payable beginning July 1, 2019 and on the first (1st) of each month thereafter throughout the Engagement Term (as such term is hereafter defined); if the Engagement Term ends prior to the last day of any month, the Monthly Fee for the last month of the Engagement Term shall be prorated for such month. Fifty percent (50%) of the Monthly Fees and Initial Fee paid will be credited to the Transaction Fee (defined below). However, there will be no such Monthly Fee credit for any Sale to Drexel University.

3. Financing Fee. Upon the closing and funding of a Financing Transaction

from any party other than Midcap Financial, Harrison Street Real Estate, Tenet Business Services Corporation, Conifer Revenue Cycle Management, or any of their respective Affiliates (each, an “Existing Financing Source”), SSG shall be entitled to a fee (“Financing Fee”) payable in cash, in federal funds via wire transfer or certified check, at and as a condition of closing of such Financing Transaction equal to (a) the greater of (i) $450,000 or (ii) one and a half percent (1.5%) of the principal amount of any Senior Debt, plus 4% of the principal amount of any Tranche B or Traditional Subordinated Debt or the aggregate securities proceeds (net of any fees and expenses thereof) of Equity (each such term as hereafter defined) raised from any financing source other than an Existing Financing Source. The Financing Fee shall be reduced by 50% if a Financing Transaction is with, or is led by, Capital One or Sector Financial, or their Affiliates.



Notwithstanding the foregoing, SSG shall be entitled to a Financing Fee of $150,000 for a Financing Transaction from an Existing Financing Source.

4. Sale Fee. Upon the consummation of a Sale Transaction, SSG shall be entitled to a fee (the “Sale Fee”), payable in cash, in federal funds via wire transfer or certified check, at and as a condition of closing of such Sale Transaction, equal to the greater of: (a) $750,000; or (b) one and a half percent (1.5%) of Total Consideration (defined below) up to and including $100 million; plus two percent (2.0%) of Total Consideration over $100 million.

However, in the event that a Sale to Drexel University, or any of its Affiliates, closes outside of a Chapter 11 bankruptcy proceeding and within one hundred (100) days from the date hereof, then the Sale Fee for such Transaction shall be $250,000. In the event of a Sale to Drexel University in a Chapter 11 bankruptcy proceeding or outside of a Chapter 11 bankruptcy proceeding but after one (100) hundred days from the date hereof, then the Sale Fee for such Transaction shall be $750,000.

In the event of a liquidation of either or both of the operating hospital entities in a PAHC Chapter 11 bankruptcy proceeding, then SSG shall be entitled to a liquidation fee of $250,000 (“Liquidation Fee”).

5. Restructuring Fee. Upon the closing of a Restructuring Transaction, SSG

shall be entitled to a fee (“Restructuring Fee”) payable in cash, in federal funds via wire transfer or certified check, at and as a condition of closing of such Restructuring Transaction, equal to $750,000.

6. Out-of-Pocket Expenses. In addition to the foregoing Initial Fee, Monthly

Fee and Transaction Fee noted above whether or not a Transaction is consummated, SSG will be entitled to reimbursement for all of SSG’s reasonable and documented out-of-pocket expenses (other than any overhead expenses of SSG) incurred in connection with the subject matter of this Engagement Agreement; provided that no expenses in excess of $25,000 in the aggregate will be reimbursed by any Company or the Company Group without the prior written approval thereof.

Notwithstanding anything to the contrary set forth in this Engagement Agreement, (i) no Sale Fee shall be calculated on any Sale Transaction involving the sale of any real estate (whether owned or leased) and any real estate sale shall be specifically excluded in the computation of any Sale Fee; (ii) if more than one fee among a Financing Fee, Sale Fee, Liquidation Fee and Restructuring Fee is applicable to a series of Transactions, SSG shall be entitled to the applicable fees; (iii) the Companies shall be aggregated for the purposes of calculation of any Transaction Fees; by way of an example and not of limitation, if multiple Companies are involved in a Restructuring Transaction, only one Restructuring Fee shall be applicable; (iv) there shall be no duplication to the extent that any amounts are used in the calculation of any Transaction Fee; by way of an example and not of limitation, if more than one Company is liable on the same Senior Debt, such Senior Debt shall be used only once in the calculation of any Financing Fee; (v) withdrawal liabilities (or a compromise or settlement thereof) with respect to any multi-employer pension plan shall not be included in the computation of any Transaction Fee; and (vi) the aggregate fees payable to SSG under this Engagement Agreement



(including, for the avoidance of doubt, the Initial Fee, Monthly Fees, Financing Fees, Sale Fees, Liquidation Fees and Restructuring Fees) shall be limited at all times to $2,000,000 (the “Cap”) and SSG will not invoice any Company for any amount in excess of the Cap except for any reimbursable expenses under Section B.6 above. C. Definitions

For the purpose of this Engagement Agreement: “Equity” means common stock, preferred stock, convertible stock, and the proceeds from any joint venture agreement, including contributions by a joint venture partner involving cash, stock, property, plant and equipment or any other assets. “Financing Transaction” means the private placement of any Senior Debt, Traditional Subordinated Debt, or non-control Equity of any Company from any lender or investor, who is not an Existing Financing Source. “Restructuring Transaction” means a conversion of any Company from a for-profit entity to a not-for-profit entity through a Chapter 11 bankruptcy proceeding that does not also involve a Sale. “Sale Transaction” means the sale or transfer, directly or indirectly, of any of the assets or equity of any Company to a person or entity that is not an Affiliate of any Company or an Existing Financing Source.

“Senior Debt” means revolving credit facilities, notes, term loans, lines of credit, or any other type of credit facility, for which any Company is obligated to repay the funds on a fixed schedule with interest on the unpaid balance thereof at a fixed interest rate or a floating interest rate, without any profit participation or yield enhancement as a return on the repayment of the funds received by such Company; and for which such Company has granted a lien on its assets, superior or prior to the claim of the holders of any Tranche B or Traditional Subordinated Debt.

“Total Consideration” shall mean the purchase price paid at the time of the effective date of the Sale, plus the assumption or payoff by the buyer of indebtedness (secured and unsecured), with a deduction for acquired accounts receivables, not including paid time off liabilities and any other assumed employee benefits. For purposes of computing any fees payable to SSG hereunder that are computed based on the Total Consideration, non-cash consideration shall be valued as follows: (a) publicly traded securities shall be valued at the average of their closing prices (as reported in The Wall Street Journal) for the five (5) trading days prior to the closing of the Sale Transaction; and (b) any other non-cash consideration shall be valued at the fair market value thereof as determined in good faith by the Company Group and SSG. If such aggregate consideration is increased by contingent payments such as an “earnout” or other monetary agreement in the Transaction, the portion of SSG’s fee relating thereto shall be calculated and paid when and as such contingent payments or other monetary amounts are received. “Traditional Subordinated Debt” means indebtedness which any Company is obligated to repay on a fixed schedule with interest on the unpaid balance therefor at a fixed interest rate or a floating rate and for which (i) the lender does not have a



claim to or lien on the assets of such Company; and (ii) part of the lender’s overall return is anticipated to consist of a participation in the profits of such Company and/or some other type of income enhancement (whether realized through equity warrants conversions of the debt to equity, or otherwise) which has the effect of raising the overall return to the lender above the level that could be realized solely due to the receipt of stated interest income.

“Tranche B Loan” means indebtedness which any Company is obligated to repay on a fixed schedule with interest on the unpaid balance therefor at a fixed interest rate or a floating rate higher than that of Senior Debt, and for which such Company has granted a lien on its assets, junior to the claim of the holders of Senior Debt. “Transaction Fee” shall mean a Financing Fee and/or Sale Fee and/or Restructuring Fee.

D. Term of Engagement

This Engagement Agreement shall remain in force (the “Engagement Term”) for a period of six (6) months from the date of acceptance of this Engagement Agreement by PAHH, RRG and PAHS, on behalf of the PAHS Group, and will continue thereafter unless terminated by SSG upon thirty (30) days prior written notice to the Company Group or by the Company Group upon fifteen (15) days prior written notice to SSG; provided, however, that either party may terminate this Engagement Agreement by written notice immediately upon the closing of a Transaction. Upon the termination of this Engagement Agreement, neither party shall have any further obligations to the other except that: (a) termination of the Engagement Agreement shall not affect SSG’s right to indemnification under the Indemnification paragraph below; (b) the Company Group shall remain obligated to pay SSG any unpaid Monthly Fees and to reimburse SSG for any expenses pursuant to Section B incurred through the date of the termination of the Engagement Agreement; and (c) if a Transaction is consummated within twelve (12) months (“Trailer Term”) of the termination of this Engagement Agreement with any party that SSG was in communication with other than any Existing Financing Source, the Company Group shall remain obligated to pay a Financing Fee and/or Sale Fee and/or Restructuring Fee, as calculated above. Sections B, D, E, F G, K and L (entitled SSG’s Compensation, Term of Engagement, Indemnification, Miscellaneous, Scope of Duties, HIPAA and Confidentiality, respectively) of this Engagement Agreement shall survive the expiration or termination of this Engagement Agreement indefinitely.

E. Indemnification

Each of SSG and the Company Group hereby acknowledges and agrees to the indemnification arrangements between the parties hereto as described on Attachment A hereto, which Attachment is incorporated herein and forms an integral part hereof.



F. Miscellaneous

No fee payable to any other financial advisor or finder by the Company Group in connection with the subject matter of this Engagement Agreement shall reduce or otherwise affect any fee payable to SSG hereunder. This Engagement Agreement and the NDA (defined below) sets forth the entire understanding of the parties relating to the subject matter hereof and supersedes and cancels any prior communications, understandings and agreements between the parties hereto. This Engagement Agreement cannot be modified or changed, nor can any of its provisions be waived, except by written agreement signed by both parties. The benefits of this Engagement Agreement shall inure to the respective successors and assigns of the parties hereto and of the SSG Indemnified Parties and their successors, assigns and representatives, and the obligations and liabilities assumed in this Engagement Agreement by the parties hereto shall be binding upon their respective successors and assigns. Notwithstanding anything to the contrary herein, SSG may not assign this Engagement Agreement or any of its rights or delegate its duties hereunder without the prior written consent of the Company Group. This Engagement Agreement may be executed in any number of counterparts, which counterparts, taken together, shall constitute one and the same Engagement Agreement. This Engagement Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware without regard to the application of any conflict of laws principles.

G. Scope of Duties

The Company Group hereby acknowledges and agrees that: (a) it has retained SSG for the purposes set forth in this Engagement Agreement and that the rights and obligations of the parties hereto are contractual in nature, and (b) SSG has not made any warranties or guarantees of any nature with respect to the success or satisfactory conclusion of any Transaction or as to the economic, financial or other results which may be obtained or experienced by the Company Group as a result thereof. Both the Company Group and SSG disclaim any intention to impose fiduciary duties or obligations on the other by virtue of the engagement contemplated by this Engagement Agreement and no other person or entity shall have any rights or obligations hereunder except as expressly provided herein.

H. Bankruptcy Court Proceedings

If any Company files a Chapter 11 bankruptcy proceeding, either voluntary or involuntary, during the Engagement Term, then (i) the Company Group shall use its commercially reasonable efforts to have SSG retained upon the same or substantially similar terms and shall have this Engagement Agreement and SSG’s retention as the Company Group’s exclusive investment banker approved by a Court of competent jurisdiction; and (ii) if such filing is by PAHS and its subsidiaries representing all or substantially all of its assets and liabilities, then SSG’s engagement by PAHH will be terminated as of the date of such filing; and if such filing is by Center City Healthcare, LLC, a subsidiary of PAHS, only, then SSG’s engagement by Center City Healthcare, LLC will be terminated as of the date of such filing.



I. Other Matters

SSG has the right, following the Financing, Sale or Restructuring closing, to place advertisements in financial and other newspapers and journals at its own expense describing its services to the Company Group hereunder and the Company Group’s prior written approval thereof shall be required except to the extent that the information contained therein is publicly available. In accordance with the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001), SSG is required to obtain, verify and record information that identifies its clients, which information may include the name and address of the Company Group and its senior management team as well as other information that will allow SSG to properly identify its clients. Additionally, SSG maintains important disclosures on its web site www.ssgca.com. These disclosures may be updated periodically on an as-needed basis. The Company Group agrees to accept and receive all of these disclosures by electronically accessing the website referenced above and acknowledges that printed hard copies of these disclosures are available upon request by contacting SSG directly at (610) 940-1094.

J. Securities Platform

All transactions involving the sale or purchase of any security (as defined by the Securities Exchange Act of 1934 or the rules and regulations promulgated thereunder) are offered through SSG Capital Advisors, LLC (“SCA”) which is an affiliated registered Broker-Dealer in good standing with the Financial Industry Regulatory Authority (“FINRA”) and the Securities Investor Protection Corporation (“SIPC”). Principals of SSG are registered representatives of SCA. Therefore, SCA is included collectively as “SSG” with all the rights and obligations thereto under the terms of this Engagement Agreement. To the extent a Transaction Fee is payable to SSG in connection with a Transaction constituting the purchase or sale of any security (as defined by the Securities Exchange Act of 1934 or the rules and regulations promulgated thereunder), such Transaction Fee (that, for the avoidance of doubt, does not include the Initial Fee or Monthly Fees) shall be specifically paid to SCA.

K. HIPAA

SSG shall not receive any information which is, or may be, considered to be Protected Health Information (“PHI”) under, and as defined in, the Health Insurance Portability and Accountability Act of 1996, as codified at 42 U.S.C. 1320d (“HIPAA”) and current and future HIPAA Requirements. SSG acknowledges that in connection with the regulations promulgated thereunder, including without limitation the federal privacy regulations contained in 45 C.F.R. Part 160 and 164 (the “Federal Privacy Regulations”), the federal security standards contained in 45 C.F.R. Part 164 (the “Federal Security Regulations”), and the federal standards for electronic transactions contained in 45 C.F.R. Parts 160 and 162, all collectively referred to herein as the “HIPAA Requirements,” SSG shall not be considered or deemed to be a business associate of any Company under the HIPAA Requirements. In the event that SSG inadvertently received any PHI, it shall immediately return such PHI, notify



the applicable Company of such inadvertent disclosure and comply with all applicable federal and state laws in connection therewith.

L. Confidentiality

Disclosure of all information pursuant to or in connection with this Engagement Agreement shall be governed by the terms of the Confidentiality Agreement, dated as of April 24, 2019, between PAHS and SSG Capital Advisors, LLC (the “NDA”).

Please indicate your acceptance of the foregoing by executing and returning the enclosed copy of this letter. SSG ADVISORS, LLC

By:

J. Scott Victor Managing Director ACCEPTED: PHILADELPHIA ACADEMIC HEALTH HOLDINGS, LLC PHILADELPHIA ACADEMIC RISK RETENTION GROUP, LLC PHILADELPHIA ACADEMIC HEALTH SYSTEM, LLC, on behalf of itself and its wholly-owned subsidiaries By: Joel Freedman Chief Executive Officer and President



ATTACHMENT A INDEMNIFICATION PROVISIONS

The Company Group agrees to indemnify, defend and hold harmless SSG or SCA, and their Affiliates, the respective partners, members, directors, officers, agents and employees of SSG, SCA, and their Affiliates (the foregoing being referred to herein individually as an “SSG Indemnified Party” and collectively as the “SSG Indemnified Parties”) from and against any and all losses, claims, damages, liabilities or costs, as and when incurred, which are asserted against any SSG Indemnified Party, directly or indirectly, by any third party, and which are in any way related to SSG acting for the Company Group under the Engagement Agreement of which this Attachment A forms a part, including, without limitation, in connection with: (a) any act or omission by SSG related to its engagement as financial advisor under the Engagement Agreement; or (b) SSG’s acceptance, or its performance or non-performance, of its obligations under said Engagement Agreement; provided, however, that the Company Group shall not be liable under the foregoing indemnity agreement in respect of any losses, claims, damages, liabilities or costs to the extent that such losses, claims, damages, liabilities or costs are found in a final judgment of a court of competent jurisdiction, not subject to further appeal, to have resulted from SSG’s gross negligence, bad faith or willful misconduct. The Company Group will reimburse the SSG Indemnified Parties for any reasonable and documented out-of-pocket legal or other expenses incurred by them, as and when incurred, in connection with defending against any such losses, claims, damages or liabilities or any action in respect thereof, whether or not in connection with pending or threatened litigation; provided, however, that the Company Group shall not be liable under the foregoing reimbursement agreement in respect of any losses, claims, damages, liabilities or costs to the extent that such losses, claims, damages, liabilities or costs are found in a final judgment of a court of competent jurisdiction, not subject to further appeal, to have resulted from SSG’s gross negligence, bad faith or willful misconduct, and in which event SSG will promptly return all legal fees and other expenses paid by the Company Group on SSG’s behalf. The Company Group agrees that reliance by SSG on any publicly-available information from sources that are generally recognized as reliable, the information supplied by the Company Group to SSG in connection with said Engagement Agreement or any directions furnished by the Company Group that have been followed by SSG shall not constitute negligence, bad faith or willful misconduct by SSG. The provisions of this Attachment A shall survive any termination of said Engagement Agreement.


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