Healthtrust, Inc., - the Hospital Company

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IN THE MATTER OF HEALTHTRUST, INC. - THE HOSPITAL COMPANY CONSENT ORDER, ETe. . IN REGARD TO ALLEGED VIOLATION OF SEe. 7 OF THE CLA YTON ACT AND SEe. 5 OF THE FEDERAL TRADE COMMISSION ACT Docket 3538. Complaint, Oct. 20. 1994.-Decision. Oct. 20, 1994 This consent order requires. among other things, a Tennessee-based corporation that provides acute care hospital services, to divest Holy Cross Hospital of Salt Lake City to a Commission approved acquirer; to complete the divestiture within six months of the date of the order; and to consent to the appointment of a trustee, if the divestiture is not compJetcd within six months. In addition the consent order requires the respondent, for ten years, to obtain prior Com mission approval before purchasing any acute care hospital or any hospital medical or surgical diagnostic or treatment service or facility in the Utah counties of Weber, Davis, and Salt Lake.

Appearances For the Commission: Mark 1. Horoschak, Philip 1\ Eisenstat and Rendell Davis.

For the respondent: Phil Proger, Jones, Day, Reavis Pogue Washington, D. C. and G. Scott Rayson, Waller, Lam'den, Dortch & Davis Nashville, TN.

COMPLAINT Pursuant to the provisions of the Federal Trade Commission Act and by virtue of the authority vested in it by said Act, the Federal Trade Commission, having reason to believe that respondent Healthtrust, Inc. - The Hospital Company ("Health trust ), a corporation subject to the jurisdiction of the Commission, has entered into an agreement whereby Healthtrust will acquire certain assets from Holy Cross Health System Corporation; that the acquisition agreement violates Section 5 of the Federal Trade Commission Act, as amended 15 U. c. 45; that the proposed acquisition, if consummated, would violate Section 7 of the Clayton Act, as amended, 15 U. c. 18. and 15Section 5 of the Federal Trade Commission Act, as amended, c. 45; and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its Complaint 118 FTC. complaint, pursuant to Section 11 (b) of the Clayton Act, 15 U. 21(b), and Section 5(b) of the Federal Trade Commission Act c. 45(b), stating its charges as follows: DEFINITONS PARAGRAPH 1. For purposes of this complaint, the following definitions shall apply:

a. Acute care hospital" means a health facility, other than a federally owned facility, having a duly organized governing body with overall administrative and professional responsibility, and an organized medical staff, that provides 24-hour inpatient care, as well as outpatient services, and having as a primary function the provision of inpatient services for medical diagnosis, treatment, and care of physically injured or sick persons with short-term or episodic health problems or infirmities.

b. Acute care inpatient hospital services means 24-hour inpatient health care, and related medical or surgical diagnostic and treatment services, for physically injured or sick persons with shortterm or episodic health problems or infirmities. THE PARTIES TO THE PROPOSED ACQUISITON PAR. 2. Healthtrust, Inc. - The Hospital Company ("Healthtrust ) is a corporation organized, existing, and doing business under and by virtue of the laws of Delaware, with its principal place of business at 4525 Harding Road, Nashville, Tennessee. Healthtrust and/or its subsidiaries own and operate six acute care hospitals in Utah, including Lakeview Hospital in Bountiful, Pioneer Valley Hospital in West Valley City, and Mountain View Hospital in Payson. PAR. 3. Holy Cross Health System Corporation ("Holy Cross is a corporation organized, existing, and doing business under and by virtue of the laws of Indiana, with its principal place of business at 3606 East Jefferson Blvd., South Bend, Indiana. Holy Cross Health Services of Utah, a wholly-owned subsidiary of Holy Cross, owns three acute care hospitals in Utah: St. Benedict s Hospital in Ogden Holy Cross Hospital in Salt Lake City, and Holy Cross-Jordan Valley Hospital in West Jordan.

HEAL THTRUST, INe. - THE HOSPITALCOMPANY 961 959 Complaint JURISDICTION PAR. 4. Healthtrust and Holy Cross are, and at all times relevant herein have been, engaged in commerce, as "commerce" is defined 15 U. c. 12. Thein Section I of the Clayton Act, as amended, businesses of Healthtrust and Holy Cross are, and at all times relevant isherein, have been, in or affecting commerce, as "commerce" , asdefined in Section 4 of the Federal Trade Commission Act amended, 15 U. c. 44.

THE PROPOSED ACQUISITON PAR. 5. On or about December 3, 1993 , Healthtrust and Holy Cross entered into an agreement whereby Healthtrust will acquire from Holy Cross substantially all the assets of Holy Cross hospitals in Utah and related Holy Cross assets in Utah. The total value of the Holy Cross assets to be acquired by Healthtrust is approximately $125 million.

NATURE OF TRADE AND COMMERCE PAR. 6. For the purposes of this complaint, the relevant line of commerce in which to analyze the proposed acquisition is the production and sale of acute care inpatient hospital services and/or any narrower group of services contained therein. PAR. 7. For the purposes of this complaint, the relevant sections of the country are the Salt Lake City area, encompassing Salt Lake County and southern Davis County; and the Salt Lake City - Ogden Metropolitan Statistical Area, an area encompassing three contiguous counties in northern Utah: Weber County, Davis County, and Salt Lake County.

MARKET STRUCTURE PAR. 8. The relevant markets -- e. the relevant hne of commerce in the relevant sections of the country -- are highly concentrat- , whether measured by Herfindahl-Hirschmann Indices ("HHI") or by four-firm concentration ratios.

Complaint 118 F.TC. ENTRY CONDITONS PAR. 9. Entry into the relevant markets is diffcult. In particular substantial lead times are required to establish a new acute care hospital in the relevant sections of the country. COMPETITON PAR. 10. In the relevant markets, Healthtrust and Holy Cross acute care hospitals are actual and potential competitors. EFFECT PAR. II. The effect of the aforesaid acquisition may be substantially to lessen competition in the relevant markets in the following ways, among others:

(a) It would eliminate actual and potential competition between Healthtrust s and Holy Cross ' hospitals in the relevant markets; (b) It would significantly increase the already high level of concentration in the relevant markets;

(c) It would eliminate Holy Cross' hospitals from the relevant markets as a substantial independent competitive force; (d) It may increase the possibility of collusion or interdependent coordination by the remaining firms in the relevant markets; and (e) It may deny patients, physicians, third-party payers, and other consumers of hospital services in the relevant markets the benefits of free and open competition based on price, quality, and service. VIOLATIONS CHARGED PAR. 12. The acquisition agreement described in paragraph five above violates Section 5 of the Federal Trade Commission Act, as amended, 15 U. c. 45.

PAR. 13. The acquisition described in paragraph five, if consummated, would violate Section 7 of the Clayton Act, as amended, 15 c. 18, and Section 5 of the Federal Trade Commission Act, as amended, 15 U.sc. 45.

HEALTHTRUST, INe. - THE HOSPITAL COMPANY 963 959 Decision and Order DECISION AND ORDER The Federal Trade Commission having initiated an investigation into the proposed acquisition by Healthtrust, Inc. - The Hospital Company of assets of Holy Cross Health System Corporation, and the respondent having been furnished thereafter with a copy of a draft of complaint which the Bureau of Competition proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge respondent with a violation of Section 7 of the Clayton Act, as amended, 15 U. S. C. 18, and Section 5 of the Federal Trade Commission Act, as amended, 15 U. c. 45; and The respondent, its attorney, and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by the respondent of all jurisdictional facts set forth in the aforesaid draft of complaint, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondent that the Jaw has been violated as alleged in such complaint, and waivers and other provisions as required by the Commission s Rules; and The Commission having thereafter considered the matter and having determined that it had reason to believe that the respondent has violated the said Acts, and that a complaint should issue stating its charges in that respect, and having thereupon accepted the executed consent agreement and placed such agreement on the public record for a period of sixty (60) days (and having duly considered the comments received), now in further conformity with the procedure prescribed in Section 2.34 of its Rules, the Commssion hereby issues its complaint, makes the following jurisdictional findings and enters the following order:

I. Respondent Healthtrust, Inc. - The Hospital Company is a corporation organized, existing and doing business under and by virtue of the laws of the State of Delaware, with its office and principal place of business at 4525 Harding Road, in the City of Nashville in the State of Tennessee.

2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent, and the proceeding is in the public interest.

Decision and Order 118 FTC. ORDER As used in this order, the following definitions shall apply: A. Respondent or Health trust means Healthtrust, Inc. - The Hospital Company, its partnerships, joint ventures, companies subsidiaries, divisions, groups and aftliates controlled by respondent and their respective directors, officers, employees, agents, and representatives, and their respective successors and assigns. B. The acquisition means the acquisition by Healthtrust of certain assets of Holy Cross Health System Corporation including Holy Cross Hospital of Salt Lake City, Holy Cross-Jordan Valley Hospital, and St. Benedict s Hospital.

C. Acute care hospital" means a health facility, other than a federally owned facility, having a duly organized governing body with overall administrative and professional responsibility, and an organized medical staff, that provides 24-hour inpatient care, as well as outpatient services, and having as a primary function the provision of inpatient services for medical diagnosis, treatment, and care of physically injured or sick persons with short-term or episodic health problems or infirmities.

D. To operate an acute care hospital" means to own, lease manage, or otherwise control or direct the operations of an acute care hospital, directly or indirectly.

E. Affliate means any entity whose management and policies are controlled in any way, directly or indirectly, by the person with which it is affiliated.

F. Person means any natural person. partnership, corporation company, association, trust, joint venture or other business or legal entity, including any governmental agency. G. Three- County Area means the area consisting of the following three Utah counties: Salt Lake County, Davis County, and Weber County.

H. Commission means the Federal Trade Commission. I. Schedule A Assets means assets acquired by the respondent and listed on the attached Schedule A.

J. Viability and competitiveness means that the Schedule A Assets are capable of functioning independently and competitively. ) ;

HEALTHTRUST, INe. - THE HOSPITAL COMPANY 965 959 Decision and Order K. Assets and Businesses include, but are not limited to, all assets, properties, businesses. rights, privileges, contractual interests licenses, and goodwill of whatever nature, tangible and intangible including, without limitation, the following: 1. All real property interests (including fee simple interests and real property leasehold interests, whether as lessor or lessee), together with all buildings, improvements and fixtures located thereon, all construction in progress thereat, all appurtenances thereto, and all licenses and permits related thereto (collectively, the "Real Property 2. All contracts and agreements with physicians, other health care providers, unions, third- party payors, HMOs, customers, suppliers, sales representatives, distributors, agents, personal property lessors, personal property lessees, licensors, licensees, cosigners and consignees (collectively, the "contracts 3. All machinery, equipment, fixtures, vehicles, furniture inventories and supplies (other than such inventories and supplies as are used in the ordinary course of business during the time that Healthtrust owns the assets) (collectively, the "Personal Property 4. All research materials, technical information, management information systems, software, software licenses, inventions, trade secrets, technology, know-how, specifications, designs, drawings, processes, and quality control data (collectively, the "Intangible Personal Property S. All books, records and files, excluding, however, the corporate minute books and tax records of Healthtrust and its Affiliates; and 6. All prepaid expenses.

II.

It is ordered That:

A. Respondent shall divest, absolutely and in good faith, within six (6) months of the date this order becomes final, the Schedule A Assets, and shall also divest such additional assets and businesses ancilary to Holy Cross Hospital of Salt Lake City, Utah (excluding Pioneer Valley Hospital, Lakeview Hospital . Jordan Valley Hospital, St. Benedict s Hospital, Salt Lake Industrial Clinic, and West Jordan Decision and Order 118 FTC. Clinic), and effect such arangements as are necessary to assure the marketability and the viability and competitiveness of the Schedule A Assets.

B. Respondent shall divest the Schedule A Assets only to an acquirer that receives the prior approval of the Commission and only in a manner that receives the prior approval of the Commission. The purpose of the divestiture of the Schedule A Assets is to ensure the continuation of the Schedule A Assets as an ongoing, viable acute care hospital and to remedy the lessening of competition resulting from the acquisition as alleged in the Commission s complaint. C. Respondent shall comply with all terms of the Agreement to Hold Separate, attached hereto and made a part hereof as Appendix I. Said agreement shall continue in effect until such time as respondent has fulfilled the divestiture requirements of this order or until such other time as the Agreement to Hold Separate provides. D. Pending divestiture of the Schedule A Assets, respondent shall take such actions as are necessary to maintain the viability and competitiveness and the marketability of the Schedule A Assets and to prevent the destruction, removal, wasting, deterioration, or impainnent of any of the Scheduled Assets except for ordinary wear and tear.

E. A condition of approval by the Commission of the divestiture shall be a written agreement by the acquirer of the Schedule A Assets that it will not sell for a period of ten (10) years from the date of divestiture, directly or indirectly, through subsidiaries, partnerships or otherwise, without the prior approval of the Commission, the Schedule A Assets to any person who operates, or will operate immediately following the sale, any other acute care hospital in the Three-County Area. Provided, however, that the acquirer is not required to seek prior approval of the Commission for the sale of any of the assets identified in Part II of Schedule A. It is further ordered, That:

A. If the respondent has not divested, absolutely and in good faith and with the Commission s prior approval, the Schedule A Assets, in accordance with this order, within six (6) months of the date this order becomes final, the Commission may appoint a trustee HEAL THTRUST, INe. - THE HOSPITALCOMPANY 967 959 Decision and Order to divest the Schedule A Assets. In the event that the Commssion or the Attorney General brings an action for any failure to comply with this order or in any way relating to the acquisition, pursuant to Section 5(1) of the Federal Trade Commission Act, 15 U. c. 45(1), or any other statute enforced by the Commission, the respondent shall consent to the appointment of a trustee in such action. Neither the appointment of a trustee nor a decision not to appoint a trustee under this paragraph shall preclude the Commission or the Attorney General from seeking civil penalties or any other relief available to it for any failure by the respondent to comply with this order. B. If a trustee is appointed by the Commission or a court pursuant to paragraph IILA. of this order, the respondent shall consent to the following terms and conditions regarding the trustee powers, duties, authority, and responsibilities: I. The Commission shall select the trustee, subject to the consent of the respondent, which consent shall not be unreasonably withheld. The trustee shall be a person with experience and expertise in acquisitions and divestitures. If respondent has not opposed, in writing, including the reasons for opposing, the selection of any proposed trustee within ten (10) days after notice by the staff of the Commission to respondent of the identity of any proposed trustee respondent shall be deemed to have consented to the selection of the proposed trustee.

2. Subject to the prior approval of the Commission, the trustee shall have the exclusive power and authority to divest the Schedule A Assets.

3. Within ten (10) days after appointment of the trustee, respondent shall execute a trust agreement that, subject to the prior approval of the Commission and, in the case of a court-appointed trustee, of the court, transfers to the trustee all rights and powers necessary to permit the trustee to effect the divestiture required by this order. 4. The trustee shall have twelve (12) months from the date the Commission approves the trust agreement described in paragraph B.3. to accomplish the divestiture, which shall be subject to the prior approval of the Commission. If, however, at the end of the twelve-month period, the trustee has submitted a plan of divestiture or believes that divestiture can be achieved within a reasonable time the divestiture period may be extended by the Commission, or in the Decision and Order 118 F.T. case of a court-appointed trustee, by the court; provided however, the Commission may extend this period only two (2) times. 5. The trustee shah have fuH and complete access to the personnel, books, records, and facilities related to the Schedule A Assets or to any other relevant information as the trustee may request. Respondent shall develop such financial or other information as such trustee may reasonably request and shah cooperate with the trustee. Respondent shall take no action to interfere with or impede the trustee s accomplishment of the divestiture. Any delays in divestiture caused by respondent shah extend the time for divestiture under this paragraph in an amount equal to the delay, as determined by the Commission or, for a court-appointed trustee, by the court. 6. The trustee shah use his or her best efforts to negotiate the most favorable price and terms available in each contract that is submitted to the Commission, subject to the respondent s absolute and unconditional obligation to divest at no minimum price. The divestiture shah be made in the manner and to the acquirer as set out in paragraph II of this order; provided, however, if the trustee receives bona fide offers from more than one acquiring entity, and if the Commission determines to approve more than one such acquiring entity, the trustee shah divest to the acquiring entity selected by respondent from among those approved by the Commission. 7. The trustee shall serve, without bond or other security, at the cost and expense of the respondent, on such reasonable and customary terms and conditions as the Commission or a court may set. The trustee shall have the authority to employ, at the cost and expense of respondent, such consultants, accountants, attorneys investment bankers, business brokers, appraisers, and other representatives and assistants as are necessary to carry out the trustee s duties and responsibilities. The trustee shall account for aH monies derived from the sale and aH expenses incurred. After approval by the Commission and, in the case of a court-appointed trustee, by the court, of the account of the trustee, including fees for his or her services, aH remaining monies shah be paid at the direction of the respondent and the trustee s power shah be terminated. The trustee s compensation shah be based at least in significant part on a commission arrangement contingent on the trustee s divesting the Schedule A Assets.

8. Respondent shah indemnify the trustee and hold the trustee harmless against any losses, claims, damages, liabilities, or expenses HEALTHTRUST, INe. - THE HOSPITAL COMPANY 969 959 Decision and Order arising out of, or in connection with, the performance of the trustee duties, including all reasonable fees of counsel and other expenses incurred in connection with the preparation for, or defense of any claim, whether or not resulting in any liability, except to the extent that such liabilities, losses, damages, claims, or expenses result from misfeasance, gross negligence, willful or wanton acts, or bad faith by the trustee.

9. If the trustee ceases to act or fails to act diligently, a substitute trustee shall be appointed in the same manner as provided in paragraph UI.A. of this order.

10. The Commission or, in the case of a court-appointed trustee the court, may on its own initiative, or at the request of the trustee issue such additional orders or directions as may be necessary or appropriate to accomplish the divestiture required by this order. II. The trustee shall have no obligation or authority to operate or maintain the Schedule A Assets.

12. The trustee shall report in writing to the respondent and the Commission every sixty (60) days concerning the trustee s efforts to accomplish divestiture.

IV.

It is further ordered That, for a period of ten (10) years from the date this order becomes final, respondent shall not, without the prior approval of the Commission, directly or indirectly, through subsidiaries, partnerships, or otherwise: A. Acquire any stock, share capital, equity, or other interest in any person presently engaged in, or within the two years preceding such acquisition engaged in, operating an acute care hospital in the Three-County Area;

B. Acquire any assets used, or previously used, in the Three- County Area (and still suitable for use) for operating an acute care hospital from any person presently engaged in, or within the two years preceding such acquisition engaged in, operating an acute care hospital in the Three-County Area;

C. Enter into any agreement or other arrangement to ohtain direct or indirect ownership, management. or control of any acute care hospital, or any part thereof, in the Three-County Area Decision and Order 118 F.TC. including but not limited to, a lease of or management contract for any such acute care hospital;

D. Acquire or otherwise obtain the right to designate directly or indirectly directors or trustees of any acute care hospital in the Three- County Area;

E. Permit any acute care hospital it operates in the Three-County Area to be acquired by any person that operates, or will operate immediately following such acquisition, any other acute care hospital in the Three-County Area.

Provided, however, that such prior approval shall not be required for: I. The establishment of a new hospital service or facility (other than as a replacement for a hospital service or facility, not operated by respondent, in the Three-County Area, pursuant to an agreement or understanding between respondent and the person operating the replaced service or facility);

2. Any transaction otherwise subject to this paragraph IV of this order if the fair market value of (or, in case of an asset acquisition the consideration to be paid for) the acute care hospital or part thereof to be acquired does not exceed one million dollars ($1 000 000); or 3. The acquisition of products or services in the ordinary course of business.

It is further ordered That, for a period of ten (10) years from the date this order becomes final, respondent shall not, directly or indirectly, through subsidiaries, partnerships or otherwise, without providing advance written notification to the Commission, consummate any joint venture or other arrangement with any other acute care hospital in the Three-County Area for the joint establishment or operation of any new acute care hospital. hospital medical or surgical diagnostic or treatment service or facility, or part thereof, in the Three-County Area. Such advance notification shall be filed immediately upon respondent s issuance of a letter of intent for, or execution of an agreement to enter into, such a transaction, whichever is earlier. Said notification required by this paragraph V of this order shall be given on the Notification and Report Form set forth in the Appendix to Part 803 of Title 16 of the Code of Federal Regulations HEALTHTRUST, INe.. THE HOSPITAL COMPANY 971 959 Decision and Order (as amended), and shall be prepared and transmitted in accordance with the requirements of that part, except that no filing fee will be required for any such notification, notification need not be made to the United States Department of Justice, and notification is required only of respondent and not of any other party to the transaction. Respondent is not required to observe any waiting period for said notification required by this paragraph V. Respondent shall comply with reasonable requests by the Commission staff for additional information concerning any transaction subject to this paragraph V of this order, within fifteen (15) days of service of such requests.

Provided, however, that no transaction shall be subject to this paragraph V of this order if:

1. The fair market value of the assets to be contributed to the joint venture or other arrangement by acute care hospitals not operated by respondent does not exceed one million dollars ($1 000 000); 2. The service, facility or part thereof to be established or operated in a transaction subject to this order is to engage in no activities other than the provision of the following services: laundry; data processing; purchasing; materials management; billing and collection; dietary; industrial engineering; maintenance; printing; security; records management; laboratory testing; personnel education, testing, or training; or health care financing (such as through a health maintenance organization or preferred provider organization); or 3. Notification is required to be made, and has been made pursuant to Section 7A of the Clayton Act. 15 U. c. 18a, or prior approval by the Commission is required, and has been requested pursuant to paragraph IV of this order.

VI.

It isfurther ordered That, for a period of ten (10) years from the date this order becomes final, respondent shall not permit all or any substantial part of any acute care hospital it operates in the Three- County Area to be acquired by any other person (except pursuant to the divestiture required by paragraph II of this order) unless the acquiring person files with the Commission, prior to the closing of such acquisition, a written agreement to be bound by the provisions Decision and Ordcr 118 F. of this order, which agreement respondent shall require as a condition precedent to the acquisition.

VI!.

It is further ordered, That:

A. Within sixty (60) days after the date this order becomes final and every sixty (60) days thereafter until the respondent has fully complied with paragraph I! of this order, the respondent shall submit to the Commission a verified written report setting forth in detail the manner and form in which it intends to comply, is complying, and has complied with paragraph I! of this order. Respondent shall include in its compliance reports, among other things that are required from time to time, a full description of the efforts being made to comply with paragraph II of the order, including a description of all substantive contacts or negotiations for the divestiture and the identity of all parties contacted. Respondent shall include in its compliance reports copies of all written communications to and from such parties, all internal memoranda, and all reports and recommendations concerning divestiture. B. One (I) yearfrom the date this order becomes final, annually for the next nine (9) years on the anniversary of the date this order becomes final, and at other times as the Commission may require, respondent shall file a verified written report with the Commission setting forth in detail the manner and form in which it has complied and it is complying with paragraphs IV, V . and VI of this order. V II It is further ordered That respondent shall notify the Commission at least thirty (30) days prior to any proposed change in the corporate respondent such as dissolution, assignment, sale resulting in the emergence of a successor corporation, or the creation or dissolution of subsidiares or any other change in the corporation that may affect compliance obligations arising out of the order. HEALTHTRUST. INe.. THE HOSPITAL COMPANY 973 959 Decision and Order IX.

It is further ordered That, for the purpose of determining or securing compliance with this order, the respondent shall permit any duly authorized representative of the Commission: A. Access, during office hours and in the presence of counsel, to inspect and copy all books, ledgers, accounts, correspondence, memoranda and other records and documents in the possession or under the control of the respondent relating to any matters contained in this order; and B. Upon five days' notice to respondent and without restraint or interference from it, to interview officers, directors, or employees of respondent.

SCHEDULE A The assets to bc divested ("Schedule A Assets ) shall consist of without limitation. all Assets and Businesses relating to Holy Cross Hospital of Salt Lake City (the "Hospital"), which were acquired by Healthtrust pursuant to the acquisition (including all improvements additions and enhancements made to such assets prior to divestiture), and shall include, without limitation, the Assets and Businesses of the following:

PART I I. Holy Cross Hospital of Salt Lake City, 1050 East South Temple, Salt Lake City;

PART II 2. Moreau Medical Building, 1002 East South Temple, Salt Lake City;

3. Salt Lake Professional Building, 24 South 1100 East, Salt Lake City;

4. Foothill Family Clinic, 2295 Foothi1 Drive, Salt Lake City; 5. Eastridge Clinic medical office suites, 160 South 10th East Salt Lake City;

Decision and Order 118F.TC. 6. Southeast Health Center, 1275 East Fort Union Boulevard, Midvale, Utah (Southeast Center for Family Medicine; Holy Cross Medical Park);

7. Southwest Health Center, 1990 West 7800 South, West Jordan Valley, Utah (Southwest Center for Family Medicine; Southwest Emergency Clinic);

8. The Magna Health Clinic, 8370 West 3500 South, Magna, Utah; and 9. The Hospital's Park City, Utah Ambulance Service. 10. The Real Property located at:

A. 45 South 1100 East, Salt Lake City - approximately .227 acres with house thereon;

B. 57 South 1100 East, Salt Lake City - approximately .21 acres with house thereon;

C. 59 South 1100 East, Salt Lake City - approximately .086 acres with house/office thereon;

D. 42 South 1000 East, Salt Lake City - approximately . 1875 acres of unimproved land;

11. Option to purchase four contiguous residential properties consisting of approximately . 54 acres in the aggregate located at approximately 1014 through 1026 East 100 South, Salt Lake City. it is further provided That to the extent that any of the contracts warranties with respect to Personal Property, licenses or other interests in the Intangible Personal Property, or other Schedule A Assets: (A) Also applies to facilities or operations other than those included in the Schedule A Assets, then during the period (the "Contract Period") beginning on the closing date of the acquisition and ending on the earlier of (I) the expiration of the term of the given contract or other right and (2) the second anniversary of Healthtrust' s divestiture of the Schedule A Assets, Healthtrust, at the request of the owner or acquirer of the Schedule A Assets, shall use its reasonable best efforts to cause the services, property or other benefits provided or made available under such a contract or other Schedule A Asset to continue to be available to the owner or acquirer of the Schedule A Assets on terms and conditions substantially similar to those presently in effect; or HEALTHTRUST, INe.. THE HOSPITAL COMPANY 975 959 Decision and Order (B) Requires the consent of a third party in order to transfer or assign such contract or other Schedule A Asset, then Healthtrust, at the request of the owner or acquirer of the Schedule A Assets, shall use its reasonable best efforts to obtain such consent and, if such consent cannot be obtained, to cooperate in any reasonable arrangement with the owner or acquirer of the Schedule A Assets designed to provide to such owner or acquirer the benefits of the given contract or other Schedule A Asset during the Contract Period on terms and conditions substantially similar to those presently in effect. Commissioner Varney not participating.

APPENDIX I AGREEMENT TO HOLD SEPARATE This Agreement to Hold Separate ("Agreement ) is by and between Healthtrust, Inc. - The Hospital Company ("respondent" or Healthtrust ), a corporation organized, existing, and doing business under and by virtue of the laws of the State of Delaware, with its principal place of business at 4525 Harding Road, Nashville, Tennessee; and the Federal Trade Commission ("Commission ), an independent agency of the United States Government, established under the Federal Trade Commission Act of 1914 15 U. c. 41 et seq. Whereas on or about December 3 1993, respondent entered into an agreement with Holy Cross Health System Corporation ("Holy Cross ), an Indiana corporation, whereby respondent will acquire from Holy Cross certain Holy Cross assets in Utah (hereinafter the Acquisition ); and Whereas the Commssion is now investigating the Acquisition to determine if it would violate any of the statutes enforced by the Commission; and Whereas if the Commission accepts the Agreement Containing Consent Order ("Consent Order ), which would require the divestiture of certain assets listed in Schedule A of the Consent Order Schedule A Assets ), including Holy Cross Hospital ("HCH") in Salt Lake City, Utah, the Commission must place the Consent Order on the public record for a period of at least sixty (60) days and may subsequently withdraw such acceptance pursuant to the provisions of Section 2.34 of the Commission s Rules; and Decision and Order ! 18 FTC. Whereas the Commission is concerned that if an understanding is not reached, preserving the status quo ante of the Schedule A Assets during the period prior to the final acceptance and issuance of the Consent Order by the Commission (after the 60-day public comment period), divestiture resulting from any proceeding challenging the legality of the Acquisition might not be possible, or might be less than an effective remedy; and Whereas the Commission is concerned that if the Acquisition is consummated, it will be necessary to preserve the Commission s ability to require the divestiture of the Schedule A Assets as described in paragraph II of the Consent Order and the Commission s right to have HCH continue as a viable independent acute care hospital; and Whereas the purpose of this Agreement and the Consent Order is to:

(i) Preserve HCH as a viable independent acute care hospital pending its divestiture, and (ii) Remedy any anticompetitive effects of the Acquisition; Whereas respondent s entering into this Agreement shall in no way be construed as an admission by respondent that the Acquisition is illegal; and Whereas respondent understands that no act or transaction contemplated by this Agreement shall be deemed immune or exempt from the provisions of the antitrust laws or the Federal Trade Commission Act by reason of anything contained in this Agreement. Now, therefore the parties agree, upon understanding that the Commission has not yet determined whether the Acquisition will be challenged, and in consideration of the Commssion s agreement that unless the Commission determines to reject the Consent Order, it will not seek further relief from respondent with respect to the Acquisition, except that the Commission may exercise any and all rights to enforce this Agreement and the Consent Order to which it is annexed and made a part thereof. and in the event the required divestiture is not accomplished . to appoint a trustee to seek divestiture of the Schedule A Assets pursuant to the Consent Order as follows:

1. Respondent agrees to execute the Agreement Containing Consent Order and be bound by the Consent Order. HEAL THTRUST, INe. - THE HOSPITAL COMPANY 977 959 Decision and Order 2. Respondent agrees that from the date this Agreement is accepted until the earliest of the dates listed in subparagraphs 2. a - 2. it will comply with the provisions of paragraph 3 of this Agreement: a. Three (3) business days after the Commission withdraws its acceptance of the Consent Order pursuant to the provisions of Section 34 of the Commission s Rules; or b. The day after the divestiture required by the Consent Order has been completed.

3. Respondent will hold the Schedule A Assets as they are presently constituted separate and apart on the following terms and conditions:

a. The Schedule A Assets, as they are presently constituted shall be held separate and apart and shall be operated independently of respondent (meaning here and hereinafter, Healthtrust excluding the Schedule A Assets) except to the extent that respondent must exercise direction and control over the Schedule A Assets to assure compliance with this Agreement or the Consent Order, and except as otherwise provided in this Agreement.

b. Prior to or simultaneously with its acquisition of the Holy Cross assets in Utah, respondent shan organize a distinct and separate legal entity, either a corporation, limited liability company, general or limited partnership ("New Company ) and adopt constituent documents for the New Company that are not inconsistent with other provisions of this Agreement or the Consent Order. Respondent shall transfer an ownership and control of an Schedule A Assets to the New Company.

c. The board of directors of the New Company, or, in the event respondent organizes an entity other than a corporation, the governing body of the entity ("New Company Board") shall have five members. Respondent may elect the members of the New Company Board; provided, however, that the New Company Board shall include no more than two members who are a director, officer employee, or agent of respondent ("the respondent s New Company Board member(s)"). The New Company Board shall include a chairman who is independent of respondent and is competent to assure the continued viability and competitiveness of the Schedule A Assets. Meetings of the New Company Board during the term of this Decision and Order 118 F.TC. Agreement shall be stenographicaJly transcribed and the transcripts retained for two (2) years after the termination of this Agreement. d. Respondent shall not exercise direction or control over, or influence directly or indirectly, the Schedule A Assets, the independent Chairman of the Board of the New Company, the New Board, or the New Company or any of its operations or businesses; provided, however, that respondent may exercise only such direction and control over the New Company as is necessary to assure compliance with this Agreement or the Consent Order. e. Respondent shall maintain the viability and competitiveness and the marketability of the Schedule A Assets and shall not sell transfer, encumber (other than in the normal course of business), or otherwise impair their viability and competitiveness or their marketability.

f. Except for the respondent s New Company Board members respondent shall not permit any director, offcer, employee, or agent of respondent to also be a director, officer, or employee of the New Company.

g. The New Company shall be staffed with sufficient employees to maintain the viability and competitiveness of the Schedule A Assets, which employees shall be selected from Holy Cross ' existing employee base and may also be hired from sources other than Holy Cross.

h. With the exception of the respondent s New Company Board Members, respondent shall not change the composition of the New Company Board unless the independent chairman consents. The independent chairman shall have power to remove members of the New Company Board for cause. Respondent shall not change the composition of the management of the New Company except that the New Company Board shall have the power to remove management employees for cause.

i. If the independent chairman ceases to act or fails to act diligently, a substitute chairman shall be appointed in the same manner as provided in paragraph 3.c. of this Agreement. j. Except as required by law, and except to the extent that necessary information is exchanged in the course of evaluating the Acquisition, defending investigations or defending or prosecllting litigation or negotiating agreements to divest assets. or complying with this Agreement or the Consent Order, respondent shall not receive or have access to, or use or continue to use, any material confidential HEALTHTRUST, INe. - THE HOSPITAL COMPANY 979 959 Dccision and Order information not in the public domain about the New Company or the activities of the New Company Board. Nor shall the New Company or the New Company Board receive or have access to, or use or continue to use, any material confidential information not in the public domain about respondent and relating to respondent s acute care hospitals in Utah. Respondent may receive on a regular basis aggregate financial information relating to the New Company necessary and essential to allow respondent to prepare United States consolidated financial reports, tax returns and personnel reports. Any such information that is obtained pursuant to this subparagraph shall be used only for the purposes set forth in this subparagraph. Material confidential information " as used herein, means competitively sensitive or proprietary information not independently known to respondent from sources other than the New Company, and includes but is not limited to customer lists, price lists, marketing methods, patents, technologies, processes, or other trade secrets. k. Except as permitted by this Agreement, the respondent's New Company Board members shall not in their capacity as New Company Board members, receive material confidential information and shall not disclose any such information received under this Agreement to respondent or use it to obtain any advantage for respondent. The respondent's New Company Board members shall enter a confidentiality agreement prohibiting disclosure of material confidential information. The respondent s New Company Board members shall participate in matters that come before the New Company Board only for the limited purposes of considering a capital investment or other transaction exceeding $250 000, approving any proposed budget and operating plans, and carrying out respondent responsibilities under this Agreement and the Consent Order. Except as permitted by this Agreement, the respondent s New Company Board members shall not participate in any matter, or attempt to influence the votes, of the other members of the New Company Board with respect to matters, that would involve a conflict of interest if respondent and the New Company were separate and independent entities.

I. If necessary to assure compliance with the terms of this Agreement, the Consent Agreement, or the Consent Order, respondent may, but is not required to, assign an individual to the New Company for the purpose of overseeing such compliance ("on-site person ). The on-site person shall have access to all officers and Decision and Order 118 FTC. employees of the New Company and such records of the New Company as he deems necessary and reasonable to assure compliance. Such individual shall enter into a confidentiality agreement prohibiting disclosure of material confidential information. m. Any material transaction of the New Company that is out of the ordinary course of business must be approved by a majority vote of the New Company Board; provided that the New Company shall engage in no transaction, material or otherwise, that is precluded by this Agreement.

n. All earnings and profits of the New Company shall be retained separately in the New Company. If necessary, respondent shall provide the New Company with suffcient working capital to operate at its current rate of operation, and to carry out any capital improvement plans for the New Company which have already been approved.

o. During the period commencing on the date this Agreement is effective and termnating on the earlier of (i) six months after the date the Consent Order becomes final, or (ii) the date contemplated by subparagraph 2.b (the "Initial Divestiture Period"), respondent shall make available for use by the New Company funds suffcient to perform all necessary routine maintenance to, and replacements of the Schedule A Assets ("normal repair and replacements ). After termination of the Initial Divestiture Period and until the earlier of the date contemplated by either subparagraph 2. a or 2. , respondent shall make available for use by the New Company each year an amount not less than that required for normal repair and replacement, plus 000,000 for capital improvements to the Schedule A Assets, unless a smaller amount is requested or required by the New Company, in its sole discretion, for capital expenditures. Provided, however, that in any event, respondent shall provide the New Company with such funds as are necessary to maintain the viability and competitiveness and marketability of the Schedule A Assets. 4. Should the Federal Trade Commssion seek in any proceeding to compel respondent to divest any of the Schedule A Assets, as provided in the Consent Order, or to seek any other injunctive or equitable relief for any failure to comply with the Consent Order or this Agreement, or in any way relating to the Acquisition, as defined in the draft complaint, respondent shall not raise any objection based upon the expiration of the applicable Hart-Scott-Rodino Antitrust HEALTHTRUST, INe. - THE HOSPITAL COMPANY 981 959 Decision and Order Improvements Act waiting period or the fact that the Commssion has permitted the Acquisition. Respondent also waives all rights to contest the validity of this Agreement.

5. To the extent that this Agreement requires respondent to take or prohibits respondent from taking, certain actions that otherwise may be required or prohibited by contract, respondent shall abide by the terms of this Agreement or the Consent Order and shall not assert as a defense such contract requirements in a civil penalty action brought by the Commission to enforce the terits of this Agreement or Consent Order.

6. For the purpose of determining or securing compliance with this Agreement, subject to any legally recognized privilege, and upon written request with reasonable notice to respondent made to its principal office, respondent shall permit any duly authorized representative or representatives of the Commission: a. Access during the office hours of respondent and in the presence of counsel to inspect and copy all books, ledgers, accounts correspondence, memoranda, and other records and documents in the possession or under the control of respondent relating to compliance with this Agreement;

b. Upon five (5) days' notice to respondent, and without restraint or interference from respondent, to interview offcers or employees of respondent, who may have counsel present, regarding any such matters.

7. This Agreement shall not be binding until approved by the Commission.

Complaint 118 F.TC.