Unassociated Document

EX-2.1 2 v232876_ex2-1.htm EXHIBIT 2.1 Unassociated Document

ASSET PURCHASE AGREEMENT

BY AND AMONG

Audiology Distribution, LLC, or its permitted assigns

as Purchaser,

Siemens Hearing Instruments, Inc., solely for purposes of Section 12.3

and

HEARUSA, INC. and

AUXILIARY HEALTH BENEFITS CORPORATION

as Sellers

Dated as of July 29, 2011

TABLE OF CONTENTS

			Page

ARTICLE I		DEFINITIONS	1
1.1	Certain Definitions.		1
1.2	Terms Defined Elsewhere in this Agreement.		10

ARTICLE II		PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES	12
2.1	Purchase and Sale of Assets.		12
2.2	Excluded Assets.		15
2.3	Assumption of Liabilities.		16
2.4	Excluded Liabilities.		17
2.5	Cure Costs; Disclosure Schedule Updates.		19
2.6	Transition Services Agreement.		20
2.7	Further Conveyances and Assumptions.		20
2.8	“As Is” Transaction.		20

ARTICLE III		CONSIDERATION AND DEPOSIT	21
3.1	Consideration.		21
3.2	Purchaser's Deposit.		22

ARTICLE IV		CLOSING AND TERMINATION	23
4.1	Closing.		23
4.2	Closing Deliveries by Sellers.		23
4.3	Closing Deliveries by the Purchaser.		24
4.4	Termination of Agreement.		24
4.5	Procedure Upon Termination.		26
4.6	Effect of Termination.		26

ARTICLE V		REPRESENTATIONS AND WARRANTIES OF THE SELLER	27
5.1	Corporate Organization and Qualification.		27
5.2	HUSA and Subsidiaries.		28
5.3	Authority Relative to This Agreement.		28
5.4	Conflicts; Consents of Certain Third Parties.		28
5.5	Litigation.		29
5.6	Intellectual Property.		29
5.7	Agreements, Contracts and Commitments; Certain Other Agreements.		29
5.8	Regulatory Matters; Permits.		31
5.9	Brokers and Finders.		31
5.10	Tangible Personal Property; Equipment.		31
5.11	Real Property.		31
5.12	Tax Returns; Taxes.		32
5.13	Employees.		32
5.14	Company Benefit Plans.		33

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5.15	Insurance Policies.		34
5.16	Vendors and Suppliers.		33
5.17	Accounts Receivable.		34
5.18	Financial Statements.		34
5.19	Absence of Undisclosed Liabilities.		34

ARTICLE VI		REPRESENTATIONS AND WARRANTIES OF THE PURCHASER	35
6.1	Corporate Organization and Qualification.		35
6.2	Authority Relative to This Agreement.		35
6.3	Consents and Approvals; No Violation.		35
6.4	Brokers and Finders.		36
6.5	Adequate Assurances Regarding Assigned Contracts.		36
6.6	Sufficiency of Financing.		36
6.7	Investigation.		36

ARTICLE VII		EMPLOYEES	36
7.1	Employee Matters.		36
7.2	Excluded Plans.		37
7.3	COBRA Coverage.		37
7.4	WARN Act Liability.		37
7.5	No Third-Party Beneficiaries.		37

ARTICLE VIII		BANKRUPTCY COURT MATTERS	38
8.1	Competing Bid and Other Matters.		38
8.2	Sale Order.		38

ARTICLE IX		COVENANTS AND AGREEMENTS	39
9.1	Conduct of Business of Sellers.		39
9.2	Access to Information.		39
9.3	Assignability of Certain Contracts, Other Purchased Assets, Etc.		40
9.4	Preservation of Records.		41
9.5	Publicity.		41
9.6	DIP Loan Documents.		41
9.7	Regulatory Approvals.		42
9.8	No Due Diligence Contingency.		43
9.9	No Financing Contingency.		43
9.10	Use of Name.		43

ARTICLE X		CONDITIONS TO CLOSING	44
10.1	Conditions Precedent to the Obligations of the Purchaser and Sellers.		44
10.2	Conditions Precedent to the Obligations of Sellers.		44
10.3	Conditions Precedent to the Obligations of the Purchaser.		45
10.4	Frustration of Closing Conditions.		45
10.5	Cure of Breach of Representation or Warranty by Sellers or Purchaser.		46

ARTICLE XI		TAXES	46
11.1	Additional Tax Matters.		46

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ARTICLE XII		MISCELLANEOUS	47
12.1	Payment of Expenses.		47
12.2	Survival of Representations and Warranties; Survival of Confidentiality.		47
12.3	Guarantee		47
12.4	Entire Agreement; Amendments and Waivers.		48
12.5	Counterparts.		48
12.6	Governing Law.		48
12.7	Jurisdiction, Waiver of Jury Trial.		49
12.8	Notices.		49

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EXHIBITS

Exhibit A	Form of Bill of Sale
Exhibit B	Form of Assignment and Assumption Agreement
Exhibit C	Form of Sale Order
Exhibit D	Form of Transition Services Agreement

SCHEDULES

Schedule 1	Subsidiaries of HearUSA, Inc.
Schedule 1.1(p)	Cure Costs
Schedule 1.1(rr)	Non-Assumed Contracts
Schedule 2.1(e)	Deposits and Prepaid Expenses
Schedule 2.1(p)	Assumed Intellectual Property; Assumed Intellectual Property Licenses
Schedule 2.1(x)	Assumed Plans
Schedule 2.2(l)	Additional Excluded Assets
Schedule 2.3(b)	Critical Payables
Schedule 2.3(i)	Promissory Notes
Schedule 2.3(k)	Additional Assumed Liabilities
Schedule 2.4(j)	Excluded Liabilities
Schedule 7.6	Certain Employee Obligations to be Paid on Closing

SELLER DISCLOSURE SCHEDULE

Section 5.2(a)	Ownership by Sellers
Section 5.4(a)	Conflicts; Consents of Third Parties
Section 5.5	Litigation
Section 5.6(a)	Owned and Licensed Intellectual Property; Claims
Section 5.6(b)	Material Software
Section 5.7(a)	Material Contracts
Section 5.7(b)	Notice of Default under Material Contracts
Section 5.7(c)	Delivery of Assigned Contracts
Section 5.8	Material Permits
Section 5.9	Brokers and Finders
Section 5.10	Personal Property Leases
Section 5.11(b)	Leased Real Property
Section 5.12	Tax Returns; Taxes
Section 5.13	Employees
Section 5.14(a)	Seller Plans
Section 5.14(d)	Welfare Benefits under Assumed Plans
Section 5.15	Insurance Policies
Section 5.16	Vendors and Suppliers
Section 5.17	Accounts Receivable
Section 5.18	Most Recent Balance Sheet
Section 5.19	Undisclosed Liabilities

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PURCHASER DISCLOSURE SCHEDULE

Section 6.3(a)	Conflicts
Section 6.3(b)	Consents of Third Parties
Section 6.4	Brokers and Finders

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ASSET PURCHASE AGREEMENT

ASSET PURCHASE AGREEMENT (this “Agreement”), dated as of July 29, 2011 (the “Execution Date”), by and among HearUSA, Inc., a Delaware corporation (“HUSA”), and Auxiliary Health Benefits Corporation d/b/a National Ear Care Plan (“Auxiliary Health”, and together with HUSA, “Sellers”), Audiology Distribution, LLC, a Delaware limited liability company or its permitted assigns pursuant to Section 12.9 (the “Purchaser”) and Siemens Hearing Instruments, Inc. (“Parent”), solely for purposes of Section 12.3. Certain capitalized terms used herein are defined in Article I.

RECITALS

WHEREAS, Sellers currently conduct the Business and the Purchaser desires to purchase certain assets and assume certain liabilities of the Business as set forth in this Agreement;

WHEREAS, HUSA is a debtor and debtor in possession in that certain bankruptcy case under chapter 11 of title 11 of the United States Code, 11 U.S.C. § 101 et seq. (the “Bankruptcy Code”), commenced on May 16, 2011 (the “Petition Date”) in the United States Bankruptcy Court for the Southern District of Florida, West Palm Beach Division (the “Bankruptcy Court”) (the “Chapter 11 Case”) and Auxiliary Health, a wholly owned subsidiary of HUSA, is not a debtor in any bankruptcy proceeding; and

WHEREAS, in connection with the Chapter 11 Case and subject to the terms and conditions contained herein and following the entry of the Sale Order approving the Purchaser as the highest and best bidder and subject to the terms and conditions thereof, Sellers shall sell, transfer and assign to the Purchaser, and the Purchaser shall purchase and acquire from Sellers, pursuant to Sections 105, 363 and 365 of the Bankruptcy Code, substantially all, but not all, of the assets of Sellers, including the Purchased Assets, and assume from Sellers the Assumed Liabilities, all as more specifically provided herein and in the Sale Order.

NOW, THEREFORE, in consideration of the foregoing and the mutual representations, warranties, covenants and agreements set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the Purchaser and Sellers hereby agree as follows:

ARTICLE I

DEFINITIONS

1.1 Certain Definitions. For purposes of this Agreement, the following terms used in this Agreement shall have the respective meanings assigned to them below:

(a) “AARP” means AARP, Inc., AARP Services, Inc. and each of their respective Affiliates.

(b) “AARP Agreement” means the Hearing Care Services Agreement, dated August 8, 2008, by and between HUSA, AARP and AARP Services, Inc., as amended.

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(c) “AARP Letter of Credit” means the Letter(s) of Credit in the amount of $3,000,000, issued for the account of Seller and delivered to AARP pursuant to the requirements of the AARP Agreement.

(d) “Accounts Receivable” means (i) any and all accounts receivable, trade accounts and other amounts receivable (including overdue accounts receivable) owed to Sellers relating to, or arising in connection with the operation and conduct of, the Business and any other rights of Sellers to payment from third parties including, but not limited to, those reflected in the books and records of HUSA, and the full benefit of all security for such accounts or rights to payment, including all trade accounts receivable representing amounts receivable in respect of services rendered, in each case owing to Sellers; (ii) all other accounts or notes receivable of Sellers and the full benefit of all security for such accounts or notes receivable arising in the conduct of the Business; and (iii) any and all claims, remedies or other rights relating to any of the foregoing, together with any interest or unpaid financing charges accrued thereon, in each case existing on the Execution Date or arising in the Ordinary Course of Business after the Execution Date and in each case that have not been satisfied or discharged prior to the close of business on the day immediately preceding the Closing Date or have not been written off or sent to collection prior to the close of business on the day immediately preceding the Closing Date (it being understood that the receipt of a check prior to the close of business on the day immediately preceding the Closing Date shall constitute satisfaction or discharge of the applicable account or note receivable to the extent of the payment represented thereby).

(e) “Affiliate” means, with respect to any Person, any other Person that, directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such Person, and the term “control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities, by contract or otherwise.

(f) “Assumed Plans” means Seller Plans that solely provide for health and other welfare benefits and are listed on Schedule 2.1(x). For the avoidance of doubt, Assumed Plans shall not include any Seller Plans that relate to retirement, pension, severance, 401k, profit sharing, stock options, bonus, supplemental unemployment plans or any other type of incentive compensation.

(g) “Bankruptcy Rules” means the Federal Rules of Bankruptcy Procedure.

(h) “Bidding Procedures Order” means the order entered by the Bankruptcy Court on June 8, 2011, approving procedures for the sale of all or substantially all of the HUSA's assets.

(i) “Business” means the business of providing a range of hearing aids, along with assessment and evaluation of hearing through the following operations: (i) the ownership and operation of 134 company-owned hearing care centers and 38 hearing centers operated by HEARx West, LLC and such total 172 centers are located in eleven states, (ii) the sponsorship of a network of approximately 1,800 credentialed audiology providers that participate in selected hearing benefit programs contracted by the Company with employer groups, health insurers and benefit sponsors in 49 states and which provide audiological testing, products and services for the hearing impaired, (iii) the administrator of the AARP Hearing Care program, and (iv) entering into, and performing provider agreements with benefit providers for the provision of hearing care arrangements.

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(j) “Business Day” means any day, excluding Saturday, Sunday and any other day on which commercial banks in New York are authorized or required by law to close.

(k) “Cash and Cash Equivalents” means all of Sellers’ cash (including petty cash and checks received prior to the close of business on the Closing Date), checking account balances, marketable securities, certificates of deposits, time deposits, bankers’ acceptances, commercial paper and government securities and other cash equivalents.

(l) “Code” means the Internal Revenue Code of 1986, as amended.

(m) “Contract” means any written or oral contract, purchase order, service order, sales order, indenture, note, bond, lease, license, commitment or instrument or other agreement, arrangement or commitment that is binding upon a Person or its property.

(n) “Cure Costs” means the amounts necessary to cure all defaults, if any, and to pay all actual pecuniary losses, if any, that have resulted from such defaults, under the Assigned Contracts, in each case as of the Petition Date and to the extent required by Section 365 of the Bankruptcy Code and any order of the Bankruptcy Court, which amounts (if not already paid or to be paid in the Ordinary Course of Business pursuant to an order of the Bankruptcy Court) are set forth on Schedule 1.1(p).

(o) “DIP Lender” means William Demant Holdings A/S.

(p) “DIP Loan” means the loan of up to $10 million which was made by the DIP Lender to HUSA, as a Chapter 11 debtor, as evidenced by the DIP Loan Documents.

(q) “DIP Loan Agreement” means that certain Debtor-in-Possession Credit Agreement, dated as of May 16, 2011, by and among HUSA and certain other subsidiaries thereof, as guarantors, and the DIP Lender, provided in connection with the Chapter 11 Case.

(r) “DIP Loan Documents” means the “Loan Documents” as defined in the DIP Loan Agreement, as such Loan Documents are amended, modified, supplemented or restated from time to time.

(s) “Documents” means all of Sellers’ written files, documents, instruments, papers, books, reports, records, tapes, microfilms, photographs, letters, budgets, forecasts, plans, operating records, safety and environmental reports, data, studies and documents, Tax Returns, ledgers, journals, title policies, customer lists, regulatory filings, operating data and plans, research material, technical documentation (design specifications, engineering information, test results, maintenance schedules, functional requirements, operating instructions, logic manuals, processes, flow charts, etc.), user documentation (installation guides, user manuals, training materials, release notes, working papers, etc.), marketing documentation (sales brochures, flyers, pamphlets, web pages, etc.) and other similar materials, in each case, whether or not in electronic form.

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(t) “Employee” means an individual who, as of the applicable date, is employed by Sellers in connection with the Business.

(u) “Encumbrance” means any lien, encumbrance, claim (as defined in Section 101(5) of the Bankruptcy Code), right, demand, charge, mortgage, deed of trust, option, pledge, security interest or similar interests, title defects, hypothecations, easements, rights of way, restrictive covenants, encroachments, rights of first refusal, preemptive rights, judgments, conditional sale or other title retention agreements and other impositions, imperfections or defects of title or restrictions on transfer or use of any nature whatsoever.

(v) “Environmental Laws” means all Laws relating to pollution or protection of health, safety, natural resources or the environment, or the generation, use, treatment, storage, handling, transportation or Release of, or exposure to, Hazardous Materials, including, without limitation, the Federal Water Pollution Control Act (33 U.S.C. §1251 et seq.), Resource Conservation and Recovery Act (42 U.S.C. §6901 et seq.), Safe Drinking Water Act (42 U.S.C. §3000(f) et seq.), Toxic Substances Control Act (15 U.S.C. §2601 et seq.), Clean Air Act (42 U.S.C. §7401 et seq.), Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. §9601 et seq.) and other similar federal, state, provincial and local statutes.

(w) “Equipment” means all equipment, machinery, vehicles, furniture, fixtures, supplies and other tangible personal property of every kind and description used, or held for use, in connection with the operation of the Business and owned by Sellers, wherever located, including but not limited to, communications equipment, the IT Assets, and any attached and associated hardware, routers, devices, panels, cables, manuals, cords, connectors, cards, and vendor documents, and including all warranties of the vendor applicable thereto, to the extent such warranties are transferable, but excluding software and any other intangibles associated therewith except to the extent embedded in such Equipment and required to operate it.

(x) “ERISA Affiliate” means any entity which is, or at any relevant time was, a member of (A) a controlled group of corporations (as defined in Section 414(b) of the Code), (B) a group of trades or businesses under common control (as defined in Section 414(c) of the Code), (C) an affiliated service group (as defined under Section 414(m) of the Code) or (D) any group specified in regulations under Section 414(o) of the Code, any of which includes or included Sellers.

(y) “Excluded Plans” means all Seller Plans that are not Assumed Plans.

(z) “Excluded Subsidiaries” means collectively (i) HEARx/PHC, LLC, (ii) HEARx Canada, Inc., (iii) HEARx Acquisition, ULC, (iv) 3838358 Canada, Inc., (v) Helix Hearing Care of American (USA) Corp. and (vi) Auxiliary Health Benefits Corporation D/B/A National Ear Care Plan. For the avoidance of doubt, HEARx West LLC is not an Excluded Subsidiary.

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(aa) “Final Order” means an order or judgment of the Bankruptcy Court or any other court of competent jurisdiction entered by the Clerk of the Bankruptcy Court or such other court on the docket in Sellers’ Chapter 11 Case or the docket of such other court, which has not been modified, amended, reversed, vacated or stayed and as to which (i) the time to appeal, petition for certiorari, or move for a new trial, reargument or rehearing has expired and as to which no appeal, petition for certiorari or motion for new trial, reargument or rehearing shall then be pending or (ii) if an appeal, writ of certiorari, new trial, reargument or rehearing thereof has been sought, such order or judgment of the Bankruptcy Court or other court of competent jurisdiction shall have been affirmed by the highest court to which such order was appealed, or certiorari shall have been denied, or a new trial, reargument or rehearing shall have been denied or resulted in no modification of such order, and the time to take any further appeal, petition for certiorari or move for a new trial, reargument or rehearing shall have expired, as a result of which such order shall have become final in accordance with Rule 8002 of the Bankruptcy Rules; provided, that the possibility that a motion under Rule 60 of the Federal Rules of Civil Procedure, or any analogous rule under the Bankruptcy Rules, may be filed relating to such order, shall not cause such order not to be a Final Order.

(bb) “First Lien Credit Agreement” means that certain Second Amended and Restated Credit Agreement, dated as of December 30, 2006, among HUSA, as borrower, and the First Lien Lender, as lender, as such agreement has been amended, modified or supplemented from time to time.

(cc) “First Lien Lender” means Siemens Hearing Instruments, Inc. and its successors and assigns.

(dd) “First Lien Loan Documents” means the “Loan Documents” as defined in the First Lien Credit Agreement, as such Loan Documents have been amended, modified, supplemented or restated from time to time.

(ee) “GAAP” means United States generally accepted accounting principles as in effect from time to time.

(ff) “Governmental Body” means any government, quasi governmental entity, or other governmental or regulatory body, agency or political subdivision thereof of any nature, whether foreign, federal, state or local, or any agency, branch, department, official, entity, instrumentality or authority thereof, or any court of applicable jurisdiction.

(gg) “Hazardous Materials” means petroleum and all derivatives thereof or synthetic substitutes therefor, asbestos and asbestos containing materials, and any and all materials now or hereafter defined, listed, designated or classified as, or otherwise determined to be, “hazardous wastes,” “hazardous substances,” “radioactive,” “solid wastes,” or “toxic” (or words of similar meaning) under or pursuant to or otherwise listed or regulated pursuant to any Environmental Law.

(hh) “HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the relevant rules and regulations thereunder.

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(ii) “Indebtedness” of any Person means, without duplication, (i) the interest in respect of, principal of and premium (if any) in respect of (x) indebtedness of such Person for money borrowed and (y) indebtedness evidenced by notes, debentures, bonds or other similar instruments for the payment of which such Person is responsible or liable; (ii) all obligations of such Person issued or assumed as the deferred purchase price of property (other than for services and goods acquired in the Ordinary Course of Business); (iii) all obligations of such Person under leases required to be capitalized in accordance with GAAP; (iv) all obligations of such Person for the reimbursement of any obligor on any letter of credit, banker’s acceptance or similar credit transaction; (v) all obligations of the type referred to in clauses (i) through (iv) of any Persons for the payment of which such Person is responsible or liable, directly or indirectly, as obligor, guarantor, surety or otherwise, including guarantees of such obligations; and (vi) all obligations of the type referred to in clauses (i) through (v) of other Persons secured by any Encumbrance (other than Permitted Encumbrances) on any property or asset of such Person (whether or not such obligation is assumed by such Person).

(jj) “Intellectual Property” means all intellectual property and proprietary rights of any kind, including the following: (i) trademarks, service marks, trade names, slogans, logos, trade dress, internet domain names, uniform resource identifiers, rights in design, brand names, and other similar designations of source or origin, together with all goodwill, registrations and applications related to the foregoing; (ii) patents, utility models and industrial design registrations (and all continuations, divisionals, continuations in part, provisionals, renewals, reissues, re-examinations and applications for any of the foregoing); (iii) copyrights and copyrightable subject matter (including without limitation any registration and applications for any of the foregoing); (iv) trade secrets and other confidential or proprietary business information (including manufacturing and production processes and techniques, research and development information, technology, drawings, specifications, designs, plans, proposals, technical data, financial, marketing and business data, pricing and cost information, business and marketing plans, customer and supplier lists and information), know how, proprietary processes, formulae, algorithms, models and methodologies; (v) computer software, computer programs, and databases (whether in source code, object code or other form); and (vi) all rights to sue for past, present and future infringement, misappropriation, dilution or other violation of any of the foregoing and all remedies at law or equity associated therewith.

(kk) “Intercompany Obligations” means any intercompany obligation or Indebtedness between Sellers whether or not evidenced by promissory notes, written contracts and/or recorded in the books and records of any Sellers.

(ll) “IT Assets” means all of Sellers’ computers, computer software and databases (including source code, object code and all related documentation), firmware, middleware, servers, workstations, routers, hubs, switches, data communications lines, and all other information technology equipment and elements, and all associated documentation that are used, or held for use, in connection with the operation of the Business.

(mm) “Knowledge of Sellers” (or “Sellers’ Knowledge”) means the actual (but not constructive) knowledge of Frank Punal and Gino Chouinard, without investigation or inquiry.

(nn) “Laws” means all federal, state, local or foreign laws, statutes, common law, rules, codes, regulations, restrictions, ordinances, orders, decrees, approvals, directives, judgments, rulings, injunctions, writs and awards of, or issued, promulgated, enforced or entered by, any and all Governmental Bodies, or court of competent jurisdiction, or other requirement or rule of law.

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(oo) “Leased Real Property” means all of the real property leased, subleased, licensed, used or occupied by Sellers, together with all buildings, structures, fixtures and improvements erected thereon, and any and all rights, privileges, easements, licenses, hereditaments and other appurtenances relating thereto, and used, or held for use, in connection with the operation of the Business.

(pp) “Liability” means, as to any Person, any debt, adverse claim, liability, duty, responsibility, obligation, commitment, assessment, cost, expense, loss, expenditure, charge, fee, penalty, fine, contribution or premium of any kind or nature whatsoever, whether known or unknown, asserted or unasserted, absolute or contingent, direct or indirect, accrued or unaccrued, liquidated or unliquidated, or due or to become due, and regardless of when sustained, incurred or asserted or when the relevant events occurred or circumstances existed, including all costs and expenses relating thereto.

(qq) “Licensed Intellectual Property” means any Intellectual Property that is licensed to either Seller.

(rr) “Non-Assumed Contracts” means any Contracts to which Sellers are parties but that are not Assigned Contracts including, without limitation, the Contracts set forth on Schedule 1.1(rr).

(ss) “Ordinary Course of Business” means the ordinary and usual course of normal day to day operations of the Business consistent with past practice.

(tt) “Owned Intellectual Property” means all Intellectual Property owned by either Seller.

(uu) “Permits” means all notifications, licenses, permits (including environmental, construction and operation permits), provider numbers, accreditations, franchises, certificates, approvals, consents, waivers, clearances, exemptions, classifications, registrations, variances, orders, tariffs, rate schedules and other similar documents and authorizations issued by any Governmental Body and/or any self-regulatory or accreditation body or organization to Sellers and used, or held for use, in connection with the operation of the Business or applicable to ownership of the Purchased Assets or assumption of the Assumed Liabilities.

(vv) “Permitted Encumbrances” means (i) Encumbrances for utilities and current Taxes not yet due and payable or being contested in good faith that, in the case of Taxes being contested in good faith, do not exceed $5,000,000 in the aggregate; (ii) easements, rights of way, restrictive covenants, encroachments and similar non-monetary encumbrances or non-monetary impediments against any of the Purchased Assets which do not, individually or in the aggregate, adversely affect the operation of the Business and, in the case of the Assumed Leased Real Property, which do not, individually or in the aggregate, adversely affect the use or occupancy of such Assumed Leased Real Property as it relates to the operation of the Business or materially detract from the value of the Assumed Leased Real Property, (iii) applicable zoning Laws, building codes, land use restrictions and other similar restrictions imposed by Law, (iv) materialmans’, mechanics’, artisans’, shippers’, warehousemans’ or other similar common law or statutory liens incurred in the Ordinary Course of Business that do not, in the aggregate, exceed $5,000,000 and (v) such other Encumbrances or title exceptions as the Purchaser may approve in writing in its sole discretion or which do not, individually or in the aggregate, adversely affect the operation or value of the Business.

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(ww) “Person” means an individual, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization, labor union, estate, Governmental Body or other entity or group.

(xx) “Petition Date” means the actual date on which Sellers commenced the Chapter 11 Case.

(yy) “Regulatory Approvals” means any consents, waivers, approvals, orders Permits or authorizations of any Governmental Body required in connection with the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereunder.

(zz) “Release” means, with respect to any Hazardous Material, any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, disposing or migrating into or through any surface or ground water, drinking water supply, soil, surface or subsurface strata or medium, or the ambient air.

(aaa) “Reserve” shall have the meaning set forth in the DIP Loan Agreement.

(bbb) “Sale Hearing” means the hearing to approve this Agreement and seeking entry of the Sale Order.

(ccc) “Sale Motion” means the motion or motions of Sellers, in form and substance reasonably acceptable to Sellers and the Purchaser, seeking approval and entry of the Bidding Procedures Order and Sale Order.

(ddd) “Sale Order” means an order substantially in the form attached hereto as Exhibit C and otherwise in form and substance satisfactory to Sellers and the Purchaser.

(eee) “Seller Plan” means (i) all “employee benefit plans” (as defined in Section 3(3) of ERISA), including all employee benefit plans which are “pension plans” (as defined in Section 3(2) of ERISA) and any other employee benefit or compensation arrangements or payroll practices (including, without limitation, severance pay, vacation pay, company awards, salary continuation for disability, sick leave, death benefit, hospitalization, welfare benefit, group or individual health, dental, medical, life, insurance, survivor benefit, deferred compensation, profit sharing, retirement, retiree medical, supplemental retirement, bonus or other incentive compensation, stock or other equity compensation plans, arrangements or policies) of Sellers and (ii) all employment, termination, bonus, severance, change in control or other similar contracts, agreements or arrangements, in each case to which any Seller is a party, with respect to which any Sellers have any Liability or obligation, which are maintained by any Seller or to which any Seller contributes or is obligated to contribute with respect to its current or former directors, officers, consultants and Employees.

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(fff) “Sellers Intellectual Property” means all Owned Intellectual Property and all Licensed Intellectual Property of the Business.

(ggg) “Siemens” means, collectively, Siemens Hearing Instruments, Inc., Rexton Inc., Siemens Aktiengesellschaft and Siemens Audiologische Technik GmbH and all of their respective Affiliates.

(hhh) “Siemens Investor Rights Agreement” means the Investor Rights Agreement, by and between Siemens and HUSA, dated December 30, 2006, as such agreement has been amended, modified or supplemented from time to time.

(iii) "Siemens Litigation" means the litigation between HUSA and the Purchaser in the Supreme Court of the State of New York, New York County, Index # 650303/2011.

(jjj) “Siemens Supply Agreement” means that certain Amended and Restated Supply Agreement, dated December 30, 2006, by and between HUSA, Siemens Hearing Instruments, Inc. and certain subsidiaries of Siemens Aktiengesellschaft, as such agreement has been amended, modified or supplemented from time to time.

(kkk) “Subsidiary” means any corporation, partnership, joint venture or other legal entity of which any Person (either alone or through or together with any other Subsidiary), owns, directly or indirectly, more than 50% of the capital stock or equity interests the holders of which are generally entitled to vote for the election of the board of directors or other governing body of such corporation or other legal entity and which are consolidated with any Seller for purposes of the Financial Statements. The Subsidiaries of HUSA are set forth on Schedule 1 hereto.

(lll) “Tax” and “Taxes” mean any and all taxes, charges, fees, tariffs, duties, impositions, levies or other assessments, imposed by any Governmental Body owing by Sellers, and includes any interest, penalties or additional amounts attributable to, or imposed upon, or with respect to, Taxes.

(mmm) “Tax Period” means any period prescribed by any Governmental Body for which a Tax Return is required to be filed or a Tax is required to be paid.

(nnn) “Tax Return” means any return, report, information return, declaration, claim for refund or other document (including any schedule or related or supporting information) supplied or required to be supplied to any Governmental Body with respect to Taxes, including amendments thereto.

(ooo) “Transition Services Agreement” means that certain Transition Services Agreement which may be executed by and between Sellers and the Purchaser with the general terms described in Exhibit D attached hereto, which may provide for the orderly transition of the Business from Sellers to the Purchaser for the “Transition Period” (as defined therein) after the Closing Date, including, without limitation, the assignment of certain Assumed Contracts during the time period in which the Purchaser acquires the necessary permits to operate the Business after the Closing Date, including, without limitation, applicable Medicare, Medicaid and medical insurance provider numbers and authorizations with respect to such Assumed Contracts.

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(ppp) “Wind Down Amount” means the amount designated in the budget agreed to by HUSA and the DIP Lender as the amount needed to fund the wind down of the Chapter 11 Case.

1.2 Terms Defined Elsewhere in this Agreement. For purposes of this Agreement, the following terms have meanings set forth in the sections indicated:

Term		Section

2009 Audited Financial Statements		5.18
2010 Unaudited Financial Statements		5.18
Accrued Employee Obligations		2.4(g)
Acquired Customers		2.1(a)
Actions		5.5
Agreement		Preamble
Allocation		11.1(b)
Antitrust Laws		9.7
Assigned Contracts		2.1(p)
Assumed Customer Contracts		2.1(a)
Assumed Independent Contractor Contracts		2.1(j)
Assumed Intellectual Property		2.1(p)
Assumed Intellectual Property Licenses		2.1(p)
Assumed Leased Real Property		2.1(i)
Assumed Liabilities		2.3
Assumed Personal Property Leases		2.1(g)
Assumed Real Property Leases		2.1(i)
Assumed Vendor Contracts		2.1(d)
Auxiliary Health		Preamble
Auxiliary Health Assets		8.2
Bankruptcy Code		Recitals
Bankruptcy Court		Recitals
Bankruptcy Exceptions		5.3
Breaching Party		10.5
Cash Balance		3.1(a)(ii)
Chapter 11 Case		Recitals
Closing		4.1
Closing Date		4.1
COBRA Continuation Coverage		7.3
Competing Bid		8.1(a)
Critical Payables		2.3(b)
Deposit		3.2(a)
DOJ		9.7(a)
Escrow Agent		3.2(a)
Excess Cure Amount		2.5(b)

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Term		Section

Excluded Assets		2.2
Excluded Liabilities		2.4
Execution Date		Preamble
Exempt Trust		5.14(c)
Financial Statements		5.18
FTC		9.7(a)
HEARx West Membership Interest		2.1(q)
HEARx West Operating Agreement		2.1(q)
HUSA		Preamble
Insurance Policies		5.15
Material Contracts		5.7(a)
Most Recent Balance Sheet		5.18
Outside Date		4.4(f)
Parent		Preamble
Purchase Price		3.1(a)
Purchased Assets		2.1
Purchaser		Preamble
Purchaser’s Documents		6.2
Purchaser Disclosure Schedule		Article VI
Qualified Plan		5.14(c)
Real Property Leases		5.11(b)
Registered IP		5.6(a)
Representatives		9.2(a)
Sale Order Deadline		4.4(d)
Sellers		Preamble
Seller Disclosure Schedule		Article V
Sellers’ Documents		5.3
Significant Vendors/Suppliers		5.16
Termination Date		12.3(b)
Transferred Employee		7.1
Transfer Taxes		11.1(a)
WARN Act		7.4

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ARTICLE II

PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES

2.1 Purchase and Sale of Assets. Pursuant to Sections 105, 363 and 365 of the Bankruptcy Code and on the terms and subject to the conditions set forth in this Agreement and the Sale Order, the Purchaser shall purchase and acquire and accept from Sellers, and Sellers shall sell, transfer, assign, convey and deliver to the Purchaser on the Closing Date all of Sellers’ right, title and interest in, to and under the Purchased Assets, free and clear of all Encumbrances (other than Encumbrances included in the Assumed Liabilities and Permitted Encumbrances). “Purchased Assets” shall mean all of the business, assets, properties, contractual rights, goodwill, going concern value, rights and claims of Sellers related to the Business, wherever situated and of whatever kind and nature, real or personal, tangible or intangible, whether or not reflected on the books and records of Sellers (other than the Excluded Assets), including, without limitation, each of the following assets (to the extent not excluded from Purchased Assets pursuant to Section 2.5):

(a) all Contracts with customers of Sellers, including, without limitation, all Contracts with end users of Sellers' products, managed care contract parties, health insurance companies, healthcare providers, physicians, network providers, governmental agencies and other customers of Sellers (the “Acquired Customers”), and all rights pursuant thereto, entered into by Sellers, including, without limitation, (i) the Material Contracts set forth on Section 5.7(a) of the Seller Disclosure Schedule and any other such Contract added to the list of Assumed Customer Contracts in accordance with Section 2.5, (ii) any other such Contract with customers of Sellers entered into in the Ordinary Course of Business between the Execution Date and the Closing Date that, if entered into by Sellers on or prior to the Execution Date, would not be a Material Contract, (iii) any other Contract with customers of Sellers entered into by Sellers between the Execution Date and the Closing Date that, if entered into by Sellers on or prior to the Execution Date, would be a Material Contract; provided that the execution thereof has been approved by the Purchaser in writing pursuant to Section 9.1 and (iv) all existing customer warranty agreements, maintenance agreements and service agreements (collectively, the “Assumed Customer Contracts”);

(b) all Accounts Receivable;

(c) all Documents used in or relating to the Business or in respect of the Purchased Assets or Assumed Liabilities, including, but not limited to, the Acquired Customers, services, marketing, advertising and promotional activities, trade shows and all files, supplier lists, vendor lists, records, literature and correspondence with sufficient detail as reasonably available;

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(d) (i) all Contracts with suppliers and vendors, including, without limitation, Contracts with subcontractors for staffing services and affiliate providers, and all rights pursuant thereto, entered into by Sellers, including, without limitation, the Siemens Supply Agreement and the Material Contracts set forth on Section 5.7(a) of the Seller Disclosure Schedule and any other such Contract added to the list of Assumed Vendor Contracts in accordance with Section 2.5 to the extent such Contracts may be assumed and assigned under Section 365 of the Bankruptcy Code, (ii) any other such Contract with suppliers or vendors of Sellers entered into in the Ordinary Course of Business between the Execution Date and the Closing Date that, if entered into by Sellers on or prior to the Execution Date, would not be a Material Contract and (iii) any other Contract with suppliers or vendors of Sellers entered into between the Execution Date and the Closing Date that, if entered into by Sellers on or prior to the Execution Date, would be a Material Contract; provided that the execution thereof has been approved by the Purchaser in writing pursuant to Section 9.1 (collectively, the “Assumed Vendor Contracts”);

(e) all deposits and prepaid expenses of Sellers, including, but not limited to (i) security deposits with third party suppliers, vendors or service providers, ad valorem taxes and lease and rental payments (other than in connection with any Excluded Assets), (ii) rebates, (iii) tenant reimbursements, (iv) pre-payments, (v) deposits or collateral for letters of credit provided by Sellers and (vi) those other deposits and pre-paid expenses set forth on Schedule 2.1(e);

(f) all Equipment, including, without limitation, the Equipment leased pursuant to the Personal Property Leases set forth in Section 5.10 of the Seller Disclosure Schedule;

(g) all leases and subleases for personal property to which Sellers are a party and used or held for use in the operation of the Business and all of the rights of Sellers to such personal property, including, without limitation, those items leased pursuant to the Personal Property Leases set forth in Section 5.10 of the Seller Disclosure Schedule (the “Assumed Personal Property Leases”);

(h) the name HearUSA, Inc., and any derivations thereof which are owned by Sellers;

(i) all leases and subleases for the Leased Real Property set forth in Section 5.11(b)(i) of the Seller Disclosure Schedule and all of Sellers’ right, title and interest in and thereto and any other such leases and subleases added to the list of Assumed Real Property Leases in accordance with Section 2.5 (such leases and subleases, the “Assumed Real Property Leases” and the underlying Leased Real Property, the “Assumed Leased Real Property”);

(j) all Contracts between Sellers and any independent contractors who are not employees of Sellers but who have been retained by Sellers and who render services (i) on behalf of Sellers or (ii) on behalf of third parties where Sellers act as an intermediary or broker, including, in each case, Contracts with independent service providers (collectively, the “Assumed Independent Contractor Contracts”);

(k) all Permits and all pending applications therefor;

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(l) all rights under non-disclosure or confidentiality, non-compete or non-solicitation agreements with Employees, agents or third parties, including, without limitation, with Acquired Customers or entered into with third parties in connection with the transactions contemplated by this Agreement;

(m) all rights, claims, credits, causes of action or rights of set off against third parties relating to the Purchased Assets (including, for the avoidance of doubt, those arising under, or otherwise relating, to the Assigned Contracts) or Assumed Liabilities, including rights under vendors’ and manufacturers’ warranties, indemnities and guaranties and including any avoidance claims or causes of action under the Bankruptcy Code or applicable state Law with respect to the Purchased Assets, including, without limitation, all rights and avoidance claims of Sellers arising under chapter 5 of the Bankruptcy Code with respect to the Purchased Assets;

(n) any counterclaims, setoffs or defenses that Sellers may have with respect to any Assumed Liabilities;

(o) all Tax Returns or Tax records of Sellers;

(p) (i) all of Sellers’ right, title and interest in and to the Seller Intellectual Property, including the items listed on Schedule 2.1(p) (collectively, the “Assumed Intellectual Property”) and (ii) all Contracts pursuant to which Sellers are granted a license to, or any rights under, any Intellectual Property of any third Person and all Contracts pursuant to which Sellers grant to a third Person a license to, or any rights under, Seller Intellectual Property, including the Contracts listed on Schedule 2.1(p) (the “Assumed Intellectual Property Licenses” and, together with the Assumed Customer Contracts, the Assumed Vendor Contracts, the Assumed Personal Property Leases, the Assumed Real Property Leases and the Assumed Independent Contractor Contracts, the “Assigned Contracts”; provided, that any Contract that is excluded from the Purchased Assets pursuant to Section 2.5 shall not be an Assigned Contract);

(q) a 50% “Percentage Interest” (as defined therein) in and to HEARx West LLC, a Delaware limited liability company (the “HEARx West Membership Interest”), as evidenced by that certain Limited Liability Company Agreement, dated as of August 10, 1998, by and between HUSA and The Permanente Federation, LLC, as amended (the “HEARx West Operating Agreement”);

(r) all of Sellers’ indemnification rights under the Assigned Contracts;

(s) all goodwill and other intangible assets associated with the Business or the Purchased Assets;

(t) all personnel files for Transferred Employees, except to the extent that any transfer or assignment to the Purchaser is prohibited by applicable Law (provided that the Purchaser shall have the right to make copies thereof to the extent permitted by applicable Law);

(u) all Documents (whether copies or originals) relating to formation, qualifications to conduct business as a foreign corporation or other legal entity, arrangements with registered agents relating to foreign qualifications, taxpayer and other identification numbers, seals, minute books, stock transfer books, stock ledgers, stock certificates, by-laws and other documents relating to the organization and existence of Sellers as corporations or other legal entities, as applicable (together with analogous documentation);

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(v) all loans and other Indebtedness payable to Sellers, including, without limitation, any loans owing by HEARx West LLC to any of Sellers, if any;

(w) all Sellers’ Insurance Policies except for Sellers’ director and officer insurance policies, fiduciary policies or employment practices policies (in each case of the foregoing, including any tail policies or coverage thereon);

(x) the Assumed Plans listed on Schedule 2.1(x) and any assets, reserves, credits and service agreements, and all Documents created, filed or maintained in connection with the Assumed Plans to the extent transferable in accordance with the existing terms and conditions of such Assumed Plans and any applicable insurance policies related to the Assumed Plans; and

(y) all Cash and Cash Equivalents, except for all cash retainers held by any professional retained with the permission of the Bankruptcy Court, the Wind Down Amount and the Reserve.

2.2 Excluded Assets. Notwithstanding anything to the contrary in this Agreement, in no event shall Sellers be deemed to sell, transfer, assign or convey, and Sellers shall retain all right, title and interest to, in and under the following assets, properties, interests and rights of Sellers (collectively, the “Excluded Assets”):

(a) all Non-Assumed Contracts;

(b) all cash retainers held by any professional retained with the permission of the Bankruptcy Court, the Wind Down Amount, the Reserve and all cash tendered as part of the Purchase Price;

(c) any claim, right or interest of Sellers in or to any refund, rebate, abatement or other recovery for Taxes with respect to the Business or the Purchased Assets, together with any interest due thereon or penalty rebate arising therefrom, for any Tax Period (or portion thereof) ending on or before the Closing Date;

(d) all Documents (whether copies or originals) (i) to the extent they relate solely to any of the Excluded Assets or Excluded Liabilities, (ii) that Sellers are required by Law to retain and are prohibited by Law from providing a copy of to the Purchaser or (iii) prepared primarily in connection with the transactions contemplated by this Agreement, including bids received from other parties, but not including any non-disclosure, confidentiality, non-compete or non-solicitation agreements;

(e) all shares of capital stock or other equity interests of Sellers or securities convertible into or exchangeable or exercisable for any such shares of capital stock or other equity interests of Sellers, but expressly excluding from the “Excluded Assets” the HEARx West Membership Interest;

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(f) Sellers’ director and officer insurance policies, fiduciary policies and employment practices policies (in each case of the foregoing, including any tail policies or coverage thereon);

(g) any avoidance claims or causes of action under the Bankruptcy Code or applicable state Law with respect to the Excluded Assets, including, without limitation, all rights and avoidance claims of Sellers arising under chapter 5 of the Bankruptcy Code with respect to the Excluded Assets;

(h) all claims, defenses, offsets, and counterclaims, if any, that Sellers may have against the First Lien Lender and any of its Affiliates under the First Lien Loan Documents or otherwise;

(i) all claims that Sellers may have against any Person solely with respect to any Excluded Assets;

(j) Sellers’ rights under this Agreement;

(k) all Seller Plans, except the Assumed Plans, including, without limitation, any assets, reserves, credits and service agreements, and all Documents created, filed or maintained in connection with such Seller Plans to the extent transferable in accordance with the existing terms and conditions of such Seller Plans and any applicable insurance policies related to such Seller Plans;

(l) the Contracts, properties and assets set forth on Schedule 2.2(l) and on Schedule 1.1 (rr) ; and

(m) the Excluded Subsidiaries.

2.3 Assumption of Liabilities. On the terms and subject to the conditions set forth in this Agreement and the Sale Order, on the Closing Date, the Purchaser shall assume only the following Liabilities of Sellers (collectively, but in all cases excluding the Excluded Liabilities, the “Assumed Liabilities”):

(a) any and all Liabilities of Sellers under each Assigned Contract;

(b) the obligation to pay the amounts owed (and no other Liabilities) for goods or services received by Sellers in the Ordinary Course of Business in respect of any trade and vendor accounts payable arising prior to, on or after the Petition Date, including, without limitation, the critical trade and vendor payables listed on Schedule 2.3(b) (such critical payables, the “Critical Payables”);

(c) any and all Liabilities arising under any Assumed Plan (to the extent transferable in accordance with the existing terms and conditions of the applicable Assumed Plan);

(d) all outstanding obligations under the DIP Loan Documents, which shall be paid in full on the Closing;

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(e) all unpaid payables to Critical Payables or permitted under the Budget, as defined in the DIP Loan Agreement and not paid as of the Closing;

(f) all Liabilities under the AARP Agreement and the obligation to deliver a substitute letter of credit to the AARP on the Closing Date to collaterally secure the Purchaser’s performance under such Contract;

(g) all Liabilities arising out of the conduct of the Business or ownership of the Purchased Assets on or after the Closing Date;

(h) any amounts owing to HEARx West LLC by any Seller, including, without limitation, the obligation to pay to HEARx West LLC any and all amounts due from Sellers to HEARx West LLC, plus accrued interest thereon at the rate designated by HEARx West LLC, at the Closing under this Agreement to repay any and all loans made by HEARx West LLC to any Seller;

(i) the promissory notes issued by Sellers to certain companies which sold assets or businesses to Sellers prior to the Petition Date as listed on Schedule 2.3(i), (and Seller has informed Purchaser that certain of the promissory notes delivered by Seller which are listed on such Schedule 2.3(i) are related to certain covenants not to compete issued to Sellers by such payees);

(j) all Liabilities arising under the Siemens Litigation; and

(k) any additional Liabilities set forth on Schedule 2.3(k).

2.4 Excluded Liabilities. Except for the Assumed Liabilities, the Purchaser shall not assume, or become liable for the payment or performance of, any Liabilities of any nature whatsoever, whether accrued or unaccrued, including, without limitation, the following Liabilities (collectively, the “Excluded Liabilities”) which shall remain Liabilities of Sellers:

(a) all Liabilities of Sellers relating to or otherwise arising, whether before, on or after the Closing, out of, or in connection with, any of the Excluded Assets;

(b) all Liabilities of Sellers in respect of Non-Assumed Contracts;

(c) except for Liabilities expressly assumed pursuant to Section 2.3 (which shall be Assumed Liabilities), all litigation and related claims and Liabilities arising out of or in connection with events occurring on or prior to the Closing Date, no matter when raised;

(d) any and all Liabilities relating to any environmental or safety matter (including any Liability or obligation under any Environmental Law), arising out of or relating to Sellers’ operation of the Business or Sellers’ leasing, ownership or operation of any Leased Real Property on or prior to the Closing Date no matter when raised;

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(e) except to the extent that Liabilities are assumed pursuant to Section 2.3 (which shall be Assumed Liabilities), all Liabilities of Sellers in respect of Indebtedness, whether or not relating to the Business, including all Liabilities arising under the First Lien Loan Documents (but excluding from this Section 2.4 (e), the DIP Loan);

(f) except to the extent that Liabilities are assumed pursuant to Section 2.3 (which shall be Assumed Liabilities), any and all claims, demands, proceedings or causes of action subject to or covered by the Insurance Policies;

(g) any and all Accrued Employee Obligations, and any and all Liabilities arising under or otherwise in respect of (i) the Excluded Plans, and (ii) any other severance, retention, employment, change in control, pension, incentive, retirement, equity or other compensation or benefit plan, program, policy, arrangement or agreement of or with any Seller or any of their respective Affiliates or ERISA Affiliates, in each case, with respect to any Employees; (iii) all accrued wages, compensation, payroll expenses (including payroll tax obligations), sick time, vacation time, and other paid time-off for Employees of Sellers, whether accruing prior to, on or after the Petition Date, and regardless of whether pursuant to a written agreement, policy manual or otherwise; (iv) any Liability arising out of any employment related matter occurring on or prior to the Closing; and (v) any Liability arising out of the Purchaser not offering employment to all Employees of Sellers as of Closing pursuant to Section 7.1 (the Liabilities and other obligations described in this clause (g), collectively, the “Accrued Employee Obligations”);

(h) any and all Liabilities of Sellers for Taxes;

(i) any payments due to any equityholders of Sellers in respect of management or other fees or otherwise;

(j) all Liabilities set forth on Schedule 2.4(j);

(k) any Liabilities of Sellers in, under or pursuant to Intercompany Obligations (except for the items described in Section 2.3(h) and (i));

(l) any and all Liabilities of Sellers under any collective bargaining agreement or any agreement with any labor union;

(m) all costs and expenses of professionals retained under Sections 327, 328, 363 or 1103 of the Bankruptcy Code and all fees owed the United States Trustee under 28 U.S.C. § 1930 9(a) or otherwise, which along with the costs associated with the wind down of the Chapter 11 Case, to the extent not previously paid, shall be paid out of and capped at the Wind Down Amount;

(n) any Liabilities arising from the operation of any successor liability Laws, including, without limitation, “bulk sales” statutes, to the extent that non-compliance therewith or the failure to obtain necessary clearances would subject the Purchaser or the Purchased Assets to the claims of any creditors of Sellers other than with respect to the Assumed Liabilities, or would subject any of the Purchased Assets to any Encumbrances or other restrictions, other than Encumbrances arising in connection with the Assumed Liabilities; and

(o) any and all Liabilities owed to or in respect of any Excluded Subsidiary.

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For the avoidance of doubt, none of the Excluded Liabilities shall be Assumed Liabilities.

2.5 Cure Costs; Disclosure Schedule Updates.

(a) At the Closing, the Purchaser shall pay, or fund the reimbursement of Sellers for the payment of, all Cure Costs in the amounts set forth on Schedule 1.1(p). Notwithstanding anything in this Agreement to the contrary, the Purchaser may revise any Schedule setting forth the Assigned Contracts (or any category thereof), the Purchased Assets or the Excluded Assets to (i) include in or exclude from the definition of Purchased Assets (pursuant to the applicable Schedule) and to include in the definition of Excluded Assets, any asset of Sellers, including, without limitation, any Contract of Sellers or other asset, not previously included in the Purchased Assets, at any time on or prior to the tenth (10th) day prior to the Sale Hearing, and require Sellers to give notice to the parties to any such Contract and (ii) exclude from the definition of Purchased Assets (pursuant to the applicable Schedule) and to include in the definition of Excluded Assets, any Purchased Asset, including, without limitation, any Assigned Contract or other asset of Sellers previously included in the Purchased Assets, at any time on or prior to the ten (10) days prior to the Sale Hearing; provided that no such change of the Schedules, the definition of the Purchased Assets or the definition of the Excluded Assets shall reduce the amount of the Purchase Price and provided further that no item in “Excluded Assets” shall be included in the “Purchased Assets.” If any Contract is added to the Purchased Assets as permitted by this Section 2.5, Sellers shall promptly take such steps as are reasonably necessary, including, if applicable, payment or adequate assurance of payment of all Cure Costs (which shall be funded by the Purchaser in cash at Closing) and prompt delivery of notice to the non-debtor counterparty, to cause such Contracts to be assumed by Sellers, and assigned to the Purchaser, on the Closing Date. If any Contract or other asset is excluded from the Purchased Assets as permitted by this Section 2.5, Seller shall promptly take such steps as are required to cause such Contract to be treated as an Excluded Asset under the Sale Order and this Agreement. Without limiting any of the Purchaser’s rights pursuant to this Section 2.5, in the event that the Sale Order does not approve the assignment or transfer of one or more of the Assigned Contracts to the Purchaser as Purchased Assets, the Purchaser may, in its sole discretion and at any time prior to the Closing Date, exclude any or all of the Assigned Contracts from the Purchased Assets, but may not otherwise terminate its obligations under this Agreement.

(b) In the event any party to a Contract timely objects to the calculation of the Cure Costs for such Contract designated by Sellers and alleges that the Cure Cost for such Contract exceeds the amount calculated by Sellers for such Contract (the amount of such excess Cure Cost for the Contract in question, the “Excess Cure Amount”), then, (i) Sellers shall provide written notice to Purchaser of such Cure Cost objection and the amount of such Excess Cure Amount for each of the proposed Assumed Contracts, and (ii) Purchaser shall, within three (3) business days after receipt of such notice from Sellers either (a) notify Sellers that Purchaser elects not to assume such Contract if the Excess Cure Amount is in excess of ten percent of the Cure Cost for such Contract and (b) take no action with respect to such notice, in which case, such Contract shall continue to be assumed by Purchaser at the Closing. At the Closing, Sellers shall retain the aggregate Excess Cure Amounts for all Assumed Contracts in escrow and shall use commercial reasonable efforts to resolve such discrepancy with such Contract parties after the Closing. In the event any such discrepancies are resolved by Sellers, then, Sellers shall refund such Excess Cure Amounts to Purchaser less any out of pocket expenses incurred by Sellers to resolve such matter(s). In the event Sellers do not resolve such discrepancy with such Contract party in question, then, Sellers shall deliver such Excess Cure Amount to the Contract parties in question.

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2.6 Transition Services Agreement. At the Closing, if requested by the Purchaser, Sellers and the Purchaser shall execute and deliver the Transition Services Agreement. In the event Sellers and Purchaser fail to execute and deliver the Transition Services Agreement for any reason or for no reason, such failure to execute and deliver such Transition Services Agreement shall not constitute a condition to the obligation of Sellers and Purchaser to close the transactions contemplated by this Agreement. In the event no Transition Services Agreement is executed, then, Section 9.3 of this Agreement shall apply with respect to the matters which were to be addressed in such Transition Services Agreement.

2.7 Further Conveyances and Assumptions. From time to time following the Closing, Sellers and the Purchaser shall, and Sellers and the Purchaser shall cause their respective Affiliates to, execute, acknowledge and deliver all such further conveyances, notices, assumptions, releases and acquaintances and such other instruments, and shall take such further actions, as may be necessary or appropriate to assign and convey fully to the Purchaser and its respective successors or assigns, all of the properties, rights, titles, interests, estates, remedies, powers and privileges intended to be conveyed to the Purchaser under this Agreement and Sellers’ Documents and to ensure the assumption of the Liabilities and obligations intended to be assumed by the Purchaser under this Agreement and Sellers’ Documents, and to otherwise make effective the transactions contemplated hereby and thereby.

2.8 “As Is” Transaction. PURCHASER HEREBY ACKNOWLEDGES AND AGREES THAT, EXCEPT AS OTHERWISE EXPRESSLY PROVIDED IN ARTICLE V OF THIS AGREEMENT, SELLERS MAKE NO REPRESENTATIONS OR WARRANTIES WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO ANY MATTER RELATING TO THE PURCHASED ASSETS. WITHOUT IN ANY WAY LIMITING THE FOREGOING, SELLERS HEREBY DISCLAIM ANY WARRANTY, EXPRESS OR IMPLIED, OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE AS TO ANY PORTION OF THE PURCHASED ASSETS. PURCHASER FURTHER ACKNOWLEDGES THAT PURCHASER HAS CONDUCTED AN INDEPENDENT INSPECTION AND INVESTIGATION OF THE PHYSICAL CONDITION OF THE PURCHASED ASSETS AND ALL SUCH OTHER MATTERS RELATING TO OR AFFECTING THE PURCHASED ASSETS AS PURCHASER DEEMED NECESSARY OR APPROPRIATE AND THAT IN PROCEEDING WITH ITS ACQUISITION OF THE PURCHASED ASSETS, EXCEPT FOR ANY REPRESENTATIONS AND WARRANTIES EXPRESSLY SET FORTH IN ARTICLE V HEREOF, PURCHASER IS DOING SO BASED SOLELY UPON SUCH INDEPENDENT INSPECTIONS AND INVESTIGATIONS. ACCORDINGLY, PURCHASER WILL ACCEPT THE PROPERTY AT THE CLOSING “AS IS,” “WHERE IS,” AND “WITH ALL FAULTS” WITHOUT REPRESENTATION OR WARRANTY (EXPRESS OR IMPLIED) AND WITHOUT RECOURSE.

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2.9 Mutual General Release Regarding Auxiliary Health. In order to induce Purchaser to execute and deliver this Agreement, effective on the Closing under this Agreement: (A) HUSA hereby irrevocably and forever releases Auxiliary Health from any and all loans, claims and other Indebtedness payable to HUSA or any of its affiliates by Auxiliary Health, including, without limitation, any loans owing by Auxiliary Health to HUSA or any of its affiliates, if any and (B) Auxiliary Health hereby irrevocably and forever releases HUSA from any and all loans, claims and other Indebtedness payable from HUSA or any of its affiliates to Auxiliary Health, including, without limitation, any loans owing by HUSA or any affiliates to Auxiliary Health or any of its affiliates, if any. Purchaser shall be an express third party beneficiary of this Section 2.9. If requested by Purchaser, Sellers shall execute and deliver a separate mutual release agreement at the Closing to Purchaser confirming the mutual release set forth in this Section 2.9.

ARTICLE III

CONSIDERATION AND DEPOSIT

3.1 Consideration.

(a) The purchase price for the Purchased Assets (the “Purchase Price”) 1 shall be the sum of the following:

(i) the amount of the Deposit; plus

(ii) the “all cash” sum in the amount of Fifty Two Million Seven Hundred Fifty Nine Thousand Nine Hundred Thirty Four and NO/100 Dollars ($52,759,934.00) and an amount sufficient to satisfy the outstanding obligations under the DIP Loan (in an amount not to exceed $10,000,000) (such amount, the “Cash Balance”); plus

(iii) the elimination of a rejection damages claim under the Siemens Supply Agreement; plus

HUSA, Parent and the Purchaser have agreed that solely for purposes of the comparison of bids from the Purchaser and William Demant Holdings A/S (“Demant”) during the Auction, the offer by the Purchaser would reflect an amount equal to $20 million corresponding to the value, agreed to for such purposes, of eliminating the possibility of a rejection damages claim regarding Parent’s Supply Agreement as long as the Purchaser was the Prevailing Bidder. HUSA, Parent and the Purchaser agreed to use this number solely for purposes of (i) qualifying the Purchaser’s Bid pursuant to the Bidding Procedures Order, (ii) comparing the Purchaser's Bids with Bids by Demant, (iii) designating the value to assign such Bid for purposes of the Auction and Sale Hearing in the event that the Purchaser was the Prevailing Bidder, and (iv) resolving Parent’s Objection to the Sale (as to HUSA’s determination of highest and best bid) [D.E. 326]. However, HUSA, Parent and the Purchaser did not agree to use this value for any other purposes and HUSA (in consultation with the Committees), the Purchaser and Demant stipulated to the $20 million valuation for the purposes set forth above and agreed that the Purchaser retained the right to assert a rejection damages claim in excess of $20 million, and that HUSA and the Committees retained the right to object to the assertion of any rejection damages, in the event that the Purchaser was not the Prevailing Bidder or the Court determined not to approve the Sale to the Purchaser. All other rights, claims, defenses and setoffs between the parties hereto are otherwise expressly preserved, including without limitation, the right of Parent to assert a rejection damage claim in excess of the amount set forth above and HUSA’s and the Committees’ rights to object to the allowance and amount of any rejection claim asserted by Parent now or in the future should Purchaser not be the Prevailing Bidder (as such term is defined in the Bidding Procedures Order) or the Bankruptcy Court determines not to approve the Sale. Because this amount, as agreed to for the stated purposes, relates to the so stipulated value of such rejection damages in the event that the Purchaser was not the Prevailing Bidder, it is not necessarily included in the Purchase Price for purposes of the allocation provided for in Section 11.1(b).

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(iv) the aggregate amount of the Cure Costs; plus

(v) the credit bid of Thirty Million Seven Hundred Forty Thousand and Sixty-Six Dollars ($30,740,066.00) of the outstanding amounts under the First Lien Loan Documents pursuant to Section 363 of the Bankruptcy Code; plus

(vi) the assumption of the amount of the Assumed Liabilities described in Section 2.3; plus

(vii) the unconditional waiver by the Parent at the Closing of the Parent’s rights to receive any distributions with respect to any common stock of HearUSA, Inc. owned by Parent.

(b) At the Closing, Sellers shall deliver to the Purchaser a written confirmation, signed by the DIP Lender, of the outstanding balance of the DIP Loan in order that the DIP Loan may be satisfied by the Purchaser and/or Parent at the Closing, pursuant to subsection (d) below.

(d) The Purchaser and/or Parent shall deliver the Cash Balance via wire transfer to Berger Singerman P.A., which shall be added to the Deposit (which shall be paid as provided in Section 3.2) and delivered to Sellers, after any adjustments described in this Agreement; and

(i) Subject to Section 2.5, the Purchaser and/or Parent shall pay directly to the obligees identified on Schedule 1.1(p) the Cure Costs;

(ii) The Purchaser and/or Parent shall pay directly to the appropriate Governmental Body the Transfer Taxes and directly to the appropriate Person the other costs and expenses to be paid by the Purchaser under this Agreement; and

(iii) With respect to the amount of the Assumed Liabilities described in Section 2.3, by the Purchaser assuming such Assumed Liabilities at the Closing; provided, however, that the Purchaser shall satisfy such Assumed Liabilities either at Closing or, in the Purchaser’s sole discretion, in the ordinary course of business.

(e) At the Closing, Purchaser will execute and deliver an appropriate agreement, in form and substance reasonably acceptable to Sellers, Parent and Purchaser, to implement and confirm the waiver of Parent described in Section 3.1(a)(vii).

3.2 Purchaser's Deposit.

(a) Prior to the execution and delivery of this Agreement by the Purchaser (time being of the essence), the Purchaser and/or Parent delivered to Berger Singerman, P.A., as escrow agent (the “Escrow Agent”), a cash earnest money deposit in the amount of Four Million Dollars ($4,000,000) (the “Deposit”) in accordance with the Bidding Procedures Order.

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(b) The Deposit shall be credited against the Purchase Price in accordance with Section 3.1(a).

ARTICLE IV

CLOSING AND TERMINATION

4.1 Closing. Subject to the satisfaction of the conditions set forth in Sections 10.1, 10.2 and 10.3 hereof or the waiver thereof by the party entitled to waive the applicable condition, the closing of the purchase and sale of the Purchased Assets, the delivery of the Purchase Price, the assumption of the Assumed Liabilities and the consummation of the other transactions contemplated by this Agreement (the “Closing”) shall take place at the Fort Lauderdale offices of Sellers’ counsel, Berger Singerman, P.A., 350 East Las Olas Blvd., Suite 1000, Fort Lauderdale, Florida 33301 or by a “mail away” closing reasonably acceptable to Sellers and the Purchaser (or at such other place as the parties may designate in writing) on the date that is no later than two (2) business days following the satisfaction or, if permitted, waiver of conditions set forth in Section 10.1, Section 10.2 and Section 10.3 (other than conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction of those conditions), unless another time or date, or both, are agreed to in writing by the parties hereto. The date on which the Closing shall be held is referred to in this Agreement as the “Closing Date.” Unless otherwise agreed by the parties in writing, the Closing shall be deemed effective and all right, title and interest of Sellers in the Purchased Assets to be acquired by the Purchaser hereunder shall be considered to have passed to the Purchaser and the assumption of all of the Assumed Liabilities shall be considered to have occurred as of 12:01 a.m. Eastern Time on the Closing Date.

4.2 Closing Deliveries by Sellers. At the Closing, Sellers shall deliver to the Purchaser:

(a) a duly executed bill of sale with respect to the Purchased Assets, substantially in the form attached hereto as Exhibit A;

(b) a duly executed assignment and assumption agreement with respect to the Assigned Contracts and the Assumed Liabilities, substantially in the form attached hereto as Exhibit B;

(d) to the extent agreed by the parties, a duly executed Transition Services Agreement;

(e) a duly executed non foreign person affidavit of Sellers, dated as of the Closing Date, sworn under penalty of perjury and in form and substance consistent with the requirements of the Treasury Regulations issued pursuant to Section 1445 of the Code, stating that each Seller is not a “foreign person” as defined in Section 1445 of the Code;

(f) the officers’ certificates required to be delivered pursuant to Sections 10.3(b) and 10.3(c);

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(g) an assignment of the HEARx West Membership Interest (without representation or warranty and without recourse) to the Purchaser or the Purchaser’s designee;

(h) a release duly executed by the DIP Lender of all claims and security interests against the Purchased Assets;

(i) all other previously undelivered certificates, agreements and other documents required by this Agreement to be delivered by Sellers at or prior to the Closing in connection with the transactions contemplated by this Agreement; and

(j) such other agreements, certificates, instruments and documents as may be reasonably requested by the Purchaser in order to fully consummate the transactions contemplated by this Agreement and carry out the purposes and intent of this Agreement.

4.3 Closing Deliveries by the Purchaser. At the Closing, the Purchaser shall pay the Purchase Price in accordance with the provisions of Section 3.1 and shall deliver or cause to be delivered to (or at the direction of) Sellers:

(a) a duly executed assignment and assumption agreement substantially in the form attached hereto as Exhibit B;

(b) to the extent agreed to by the parties, a duly executed Transition Services Agreement substantially in the form attached hereto as Exhibit D;

(d) an alternative letter of credit or other collateral acceptable to AARP under the AARP Agreement, for delivery to AARP in exchange for the AARP Letter of Credit, provided, however, that any deposits or collateral for the AARP Letter of Credit provided by Seller at any time prior to the Closing shall be Purchased Assets as provided in Section 2.1(e)(v) hereof;

(e) written confirmation from the DIP Lender, in form and substance acceptable to Sellers that the DIP Loan has been satisfied in full and all liens and security interests granted under the DIP Loan Documents have been released by the DIP Lender;

(f) all other previously undelivered certificates, agreements and other documents required by this Agreement to be delivered by the Purchaser at or prior to the Closing in connection with the transactions contemplated by this Agreement; and (i) such other agreements, certificates, instruments and documents reasonably requested by Sellers in order to fully consummate the transactions contemplated by this Agreement and carry out the purposes and intent of this Agreement.

4.4 Termination of Agreement. This Agreement may be terminated as follows:

(a) by the mutual written consent of Sellers and the Purchaser at any time prior to the Closing;

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(b) by either the Purchaser or Sellers, if there shall be any Law that makes consummation of the transactions contemplated hereby illegal or otherwise prohibited, or there shall be in effect a final non-appealable order of a Governmental Body of competent jurisdiction restraining, enjoining or otherwise prohibiting the consummation of the transactions contemplated hereby; it being agreed that the parties hereto shall promptly appeal any adverse determination which is appealable (and pursue such appeal with reasonable diligence);

(c) by the Purchaser, if the Chapter 11 Case is dismissed or converted to a case or cases under Chapter 7 of the Bankruptcy Code, or if a trustee is appointed in the Chapter 11 Case or if an examiner with expanded powers to operate or manage the financial affairs, the business or the reorganization of Sellers is appointed in the Chapter 11 Case;

(d) by the Purchaser, if the Sale Order shall not have been entered by the Bankruptcy Court by the close of business on or before August 4, 2011 (the “Sale Order Deadline”); provided, however, that the right to terminate this Agreement under this Section 4.4(d) shall not be available to the Purchaser if its failure to fulfill any material obligation under this Agreement has been the cause of, or resulted in, the failure of the Sale Order to have been entered or issued by the Sale Order Deadline;

(e) by either the Purchaser or Sellers prior to the Closing, if, following its entry, the Sale Order shall fail to be in full force and effect or shall have been stayed, reversed, modified or amended in any respect without the prior written consent of the Purchaser and Sellers; provided, however, that the right to terminate this Agreement under this Section 4.4(e) shall not be available to any party whose failure to fulfill any material obligation under this Agreement has been the cause of, or resulted in, the failure of the Sale Order to be in full force and effect;

(f) by either the Purchaser or Sellers, if the Closing shall not have been consummated on the day that is sixty (60) days after the Bankruptcy Court enters the Sale Order (the “Outside Date”); provided, further, that if the Closing shall not have occurred on or before the Outside Date due to a material breach of any representations, warranties, covenants or agreements contained in this Agreement by the Purchaser or Sellers, then the Purchaser (if it is so in breach) or Sellers (if Sellers are in breach) may not terminate this Agreement pursuant to this Section 4.4(f);

(g) by Sellers, if the Purchaser has breached any representation, warranty, covenant or agreement contained in this Agreement and as a result of such breach the conditions set forth in Section 10.2(a) and Section 10.2(b) hereof, as the case may be, would not then be satisfied at the time of such breach; provided, however, that if such breach is curable by the Purchaser within thirty (30) days through the exercise of its reasonable best efforts, then for so long as the Purchaser continues to exercise such reasonable best efforts Sellers may not terminate this Agreement under this Section 4.4(g) unless such breach is not cured within thirty (30) days from written notice to the Purchaser of such breach; provided, further, that if Sellers are in material breach of the terms of this Agreement, they may not terminate this Agreement pursuant to this Section 4.4(g), provided further that a three (3) business day notice and cure period shall be applicable for the Purchaser’s failure to close on the Closing Date and provided further, that no cure period shall be required for a breach which by its nature cannot be cured;

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(h) by the Purchaser, if Sellers have breached any representation, warranty, covenant or agreement contained in this Agreement and as a result of such breach the conditions set forth in Section 10.3(b) and Section 10.3(c) hereof, as the case may be, would not then be satisfied at the time of such breach; provided, however, that if such breach is curable by Sellers within thirty (30) days through the exercise of Sellers’ reasonable best efforts, then for so long as Sellers continue to exercise such reasonable best efforts the Purchaser may not terminate this Agreement under this Section 4.4(i) unless such breach is not cured within thirty (30) days from written notice to Sellers of such breach; provided, further, that if the Purchaser is in material breach of the terms of this Agreement, it may not terminate this Agreement pursuant to this Section 4.4(h); provided further that a three (3) Business Day notice and cure period shall be applicable for Sellers’ failure to close on the Closing Date and provided further, that no cure period shall be required for a breach which by its nature cannot be cured;

(i) by Sellers, if all of the conditions set forth in Sections 10.1 and 10.3 have been satisfied (other than conditions that by their nature are to be satisfied at the Closing) or waived for at least five (5) business days, Seller have tendered performance hereunder in accordance with this Agreement and the Purchaser fails to deliver the Purchase Price at the Closing;

(j) by the Purchaser, if all of the conditions set forth in Sections 10.1 and 10.2 have been satisfied (other than conditions that by their nature are to be satisfied at the Closing) or waived for at least five (5) business days, Purchaser has tendered performance hereunder in accordance with this Agreement and Sellers fail to deliver the Purchased Assets at the Closing; or

(k) by the Purchaser if the Sale Order is not a Final Order by the Outside Date.

4.5 Procedure Upon Termination. In the event of a termination of this Agreement by the Purchaser or Sellers, or both, pursuant to Section 4.4, (a) written notice thereof shall be given promptly by the terminating party to the other parties hereto, specifying the provision hereof pursuant to which such termination is made, (b) except as contemplated by Section 4.6, this Agreement shall thereupon terminate and become void and of no further force and effect and (c) the consummation of the transactions contemplated by this Agreement shall be abandoned without further action of the parties hereto. If this Agreement is terminated as provided herein, each party shall redeliver all documents, work papers and other material of any other party relating to the transactions contemplated hereby, whether so obtained before or after the execution hereof, to the party furnishing the same.

4.6 Effect of Termination.

(a) In the event that this Agreement is validly terminated as provided herein, then each of the parties shall be relieved of its duties and obligations arising under this Agreement effective as of the date of such termination and such termination shall be without Liability to the Purchaser or Sellers; provided, however, that Section 4.4, Section 4.5, this Section 4.6, Article XII and the Bidding Procedures Order shall survive any such termination and shall be enforceable hereunder.

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(b) Notwithstanding anything to the contrary contained herein, in the event that this Agreement is terminated by Sellers pursuant to Section 4.4(g) or Section 4.4(i), the Deposit shall be paid to Sellers to compensate Sellers for the costs and expenses incurred by Sellers in connection with the negotiation, execution, delivery and performance of this Agreement as liquidated damages and the Purchaser shall not incur further liability under this Agreement. Sellers and the Purchaser acknowledge that the calculation of the damages caused to Sellers is difficult to estimate at this time and that the amount of the Deposit is a reasonable estimation of the amount of damages which would be incurred by Sellers if this Agreement is terminated as a result of the Purchaser’s material breach of any of its obligations under this Agreement.

(c) In the event Sellers properly terminate this Agreement pursuant to Section 4.4(g), or Section 4.4(i), then Sellers shall receive the Deposit as liquidated damages and as Sellers’ sole and exclusive remedy for the breach by the Purchaser of this Agreement as further described in Section 4.6(b) above.

(d) In the event the Purchaser or Sellers properly terminate this Agreement for any reason other than pursuant to Section 4.4(g) or Section 4.4(i), then, the Purchaser shall receive a return of the Deposit upon such termination and neither party shall have any liability under this Agreement.

(e) For avoidance of doubt, and notwithstanding anything herein to the contrary or any legal theory of any kind, if the transactions contemplated hereby are not consummated for any reason, (i) the maximum Liability that the Purchaser may have hereunder shall be forfeiture of the Deposit to Sellers and (ii) the maximum Liability that Sellers shall have hereunder shall be the return of the Deposit.

ARTICLE V

REPRESENTATIONS AND WARRANTIES OF THE SELLER

Sellers hereby, jointly and severally, make the representations and warranties in this Article V to the Purchaser as of the Execution Date (except with respect to representations and warranties made as of a particular date, which shall be deemed to be made only as of such date), except as qualified or supplemented by Sections in the disclosure schedule delivered by Sellers to Purchaser prior to the execution and delivery of this Agreement, which identifies exceptions only by the specific Section or subsection to which each entry relates (the “Seller Disclosure Schedule”).

5.1 Corporate Organization and Qualification. HUSA is a corporation duly incorporated, validly existing and in good standing under the Laws of the State of Delaware. Each Subsidiary of HUSA is duly organized, validly existing and in good standing under the Laws of its respective jurisdiction of organization.

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5.2 HUSA and Subsidiaries.

(a) Section 5.2(a) of the Seller Disclosure Schedule sets forth each corporation, association or other entity in which Sellers own, of record or beneficially, any direct or indirect equity or other interest or any right (contingent or otherwise) to acquire the same.

5.3 Authority Relative to This Agreement. Except for such authorization as is required by the Bankruptcy Court and receipt of any Regulatory Approvals, Sellers have all requisite power, authority and legal capacity to (a) execute and deliver this Agreement, (b) execute and deliver each other agreement, document, instrument or certificate contemplated by this Agreement or to be executed by Sellers in connection with the consummation of the transactions contemplated by this Agreement (the “Sellers’ Documents”), and (c) perform its obligations hereunder and thereunder and consummate the transactions contemplated hereby and thereby. The execution and delivery of this Agreement and the Sellers’ Documents, and the consummation of the transactions contemplated hereby and thereby, have been duly authorized by all requisite action on the part of Sellers. This Agreement has been, and at or prior to the Closing, each of the Sellers’ Documents will be, duly and validly executed and delivered by Sellers and (assuming the due authorization, execution and delivery by the other parties hereto and thereto, and the entry of the Sale Order) this Agreement constitutes, and each of the Sellers’ Documents when so executed and delivered will constitute, legal, valid and binding obligations of Sellers, enforceable against Sellers in accordance with its respective terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally, and subject, as to enforceability, to general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity) (the “Bankruptcy Exceptions”).

5.4 Conflicts; Consents of Certain Third Parties. Except as set forth in Section 5.4 of the Seller Disclosure Schedule or as permitted by the Sale Order, none of the execution and delivery by Sellers of this Agreement or any Sellers’ Document, the consummation of the transactions contemplated hereby or thereby, or compliance by Sellers with any of the provisions hereof or thereof will conflict with, or result in any violation of or constitute a breach or default (with or without notice or lapse of time, or both) under, or give rise to a right of acceleration, payment, amendment, termination or cancellation under any provision of (i) the certificate of incorporation or bylaws of HUSA or any similar organization documents of any of its Subsidiaries; (ii) subject to and assuming entry of the Sale Order, any order of any Governmental Body applicable to Sellers or any of the properties or assets of Sellers, including the Purchased Assets, or the Business; or (iii) subject to and assuming entry of the Sale Order, any applicable Law, other than, in the case of clauses (ii), and (iii), such conflicts, violations, defaults, terminations or cancellations that would not have, individually or in the aggregate, a material adverse effect on Sellers’ ability to operate the Business in the Ordinary Course of Business.

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5.5 Litigation. Except as set forth in Section 5.5 of the Seller Disclosure Schedule and for ordinary course workers compensation litigation and other proceedings which is currently being administered by one or more insurance companies for the benefit of Sellers, there is no material litigation, action, claim, suit, proceeding, investigation, examination, hearing, arbitration, inquiry or subpoena (collectively, “Actions”), pending or, to the Knowledge of Sellers, threatened against Sellers or any property or asset of Sellers or which could give rise to or increase an Assumed Liability. Except as set forth in Section 5.5 of the Seller Disclosure Schedule, no Sellers are subject to any judgment, decree, injunction or order of any court, arbitration panel or other Governmental Body that relates to the Business or the Purchased Assets and for which Sellers have any continuing obligations or Liabilities. For the avoidance of doubt, all of the Actions, other than the Siemens Litigation, are Excluded Liabilities.

5.6 Intellectual Property.

(a) Section 5.6(a) of the Seller Disclosure Schedule sets forth a true, complete and correct list of (i) all of the patents, registered trademarks, registered copyrights, Internet domain names and applications for any of the foregoing, in each case that constitute the Owned Intellectual Property (collectively, the “Registered IP”) and (ii) a list of all other material Owned Intellectual Property and a list of all Licensed Intellectual Property (except for Intellectual Property licensed pursuant to off the shelf software and licenses implied in the sale of such software), all of which are Purchased Assets.

(b) Section 5.6(b) of the Seller Disclosure Schedule sets forth a true, complete and correct list of all material software, databases, licenses, and contracts that are included in, comprise or are related to the Owned Intellectual Property, except for off the shelf software and licenses implied in the sale of such software, all of which are Purchased Assets.

5.7 Agreements, Contracts and Commitments; Certain Other Agreements.

(a) Section 5.7(a) of the Seller Disclosure Schedule sets forth all of the following executory Contracts that are unexpired as of the Execution Date, to which either Seller or any of their Subsidiaries is a party or by which any of them is bound or any of the Purchased Assets are bound (such Contracts set forth below are collectively referred to as the “Material Contracts”):

(i) each note, mortgage, indenture and other obligation and agreement and other instrument for or relating to any lending or borrowing of Sellers or any of their Subsidiaries or to which any assets of Sellers or any of their Subsidiaries are subject;

(ii) each Contract since January 1, 2010 which provides for payment in excess of $150,000 or pursuant to which Sellers or any of their Subsidiaries have any remaining liability to pay contingent consideration, including any option to acquire or sell any material properties or material assets of Sellers or any of their Subsidiaries;

(iii) each limited partnership agreement, or limited liability company operating agreement and other joint venture agreement or other similar Contract pursuant to which Sellers or any of their Subsidiaries have any equity interest in any other Person;

(iv) each managed care Contract providing for a payment from the applicable insurer in excess of $100,000 per month;

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(v) each Contract which Sellers reasonably anticipate will involve future payment or payments to Sellers and their Subsidiaries in excess of $1,000,000 in any calendar year;

(vi) each Contract with suppliers (other than Contracts relating to insurance and, real property leases), which Sellers reasonably anticipate will involve future payment or payments by Sellers and their Subsidiaries in excess of $500,000 in any calendar year;

(vii) each other Contract (other than Contracts with Employees, customers or suppliers) that involves the payment to or from Sellers and their Subsidiaries in excess of $100,000 in any calendar year in each individual case;

(viii) all Contracts pursuant to which Sellers and their Subsidiaries would be required to make payments in excess of $100,000 from and after the Execution Date and prior to the end of the earlier of (A) the term of the applicable Contract and (B) the twelve (12) month anniversary of the Execution Date;

(ix) all employment agreements, severance agreements and collective bargaining agreements with any labor unions;

(x) all Contracts to which any officer or director of either Seller or any of their Subsidiaries or any Affiliate of any such officer or director, is a party;

(xi) all leases for any real property or any material Equipment used or held for use in the Business;

(xii) all Contracts that: (A) limit or restrict Sellers or any of their Affiliates from engaging in any business or other activity in any jurisdiction; or (B) create or purport to create any exclusive relationship or arrangement;

(xiii) all Contracts granting to any Person an option or a right of first refusal, first-offer or similar preferential right to purchase or acquire any of the Purchased Assets;

(xiv) all Contracts for the granting or receiving of a license, sublicense or franchise or under which any Person is obligated to pay or has the right to receive a royalty, license fee, franchise fee or similar payment;

(xv) all Contracts with respect to Owned Intellectual Property or Licensed Intellectual Property (except for “off the shelf” Licensed Intellectual Property);

(xvi) each sales agent, dealer, distributor or joint marketing Contract;

(xvii) each Tax sharing, indemnification, allocation or similar Contract; and

(xviii) Contracts with any Governmental Body.

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(b) Except as set forth in Section 5.7(b) of the Seller Disclosure Schedule, no Sellers have received any written notice of any default or event that with notice or lapse of time or both would constitute such a default by either Seller or any of their Subsidiaries under any Material Contract.

(c) Except as set forth in Section 5.7(c) of the Seller Disclosure Schedule, to Sellers’ Knowledge, Sellers have heretofore delivered or made available to the Purchaser true and complete copies of all Material Contracts (or, in the case of oral Material Contracts, a complete and accurate description), including all amendments, modifications, schedules and supplements thereto and all waivers with respect thereto.

5.8 Regulatory Matters; Permits. To Sellers’ Knowledge, (a) all of the Permits that are necessary for the operation of the Business as currently conducted and the ownership of the Purchased Assets are held by Sellers or, as applicable, by Employees, as applicable, (b) each such Permit is in full force and effect and (c) each such Permit will be transferred at the Closing. Section 5.8 of the Seller Disclosure Schedule sets forth a complete and accurate list of all material Permits held by Sellers and their Subsidiaries.

5.9 Brokers and Finders. Except as set forth in Section 5.9 of the Seller Disclosure Schedule, Sellers have not employed, and to the Knowledge of Sellers, no other Person has made any arrangement by or on behalf of Sellers with any investment banker, broker, finder, consultant or intermediary in connection with the transactions contemplated by this Agreement which would be entitled to any investment banking, brokerage, finder’s or similar fee or commission in connection with this Agreement or the transactions contemplated hereby.

5.10 Tangible Personal Property; Equipment. Section 5.10 of the Seller Disclosure Schedule sets forth all Personal Property Leases involving annual payments in excess of $100,000.00 relating to personal property, including Equipment, used by Sellers in the Business or to which Sellers are parties or by which the personal property, including Equipment, of Sellers are bound all of which are Purchased Assets.

5.11 Real Property.

(a) Neither Seller nor any of their Subsidiaries owns any real property.

(b) Section 5.11(b)(i) of the Seller Disclosure Schedule sets forth a complete and correct list of all Leased Real Property, specifying the address, the lessor(s) of such Leased Real Property and any other information necessary to identify the Contract under which such Leased Real Property is leased (the “Real Property Leases”). Subject to Section 2.5, all of the Real Property Leases are Purchased Assets. Except as set forth on Section 5.11(b)(ii) of the Seller Disclosure Schedule, no Leased Real Property is subject to an Encumbrance other than Permitted Encumbrances or Encumbrances that will be terminated on or prior to the Closing Date. Except as described on Section 5.11(b)(iii) of the Seller Disclosure Schedule, there are no written or oral subleases, licenses, concessions, occupancy agreements or other Contracts granting to any other Person the right of use or occupancy of the Leased Real Property and there is no Person (other than Sellers and any lessor(s) of Leased Real Property) in possession of the Leased Real Property. Sellers have delivered to the Purchaser a true and correct copy of each Real Property Lease included in the Purchased Assets. Except as set forth in Section 5.11(b)(iv) of the Seller Disclosure Schedule, to Sellers’ Knowledge, each Real Property Lease is valid and in full force and effect and represents the entire agreement between Sellers and the applicable lessor.

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5.12 Tax Returns; Taxes. Except as set forth in Section 5.12 of the Seller Disclosure Schedule:

(a) All Tax Returns required to have been filed by Sellers have been duly filed and are true, correct and complete in all material respects. No extension of time in which to file any such Tax Returns is in effect.

(b) All Taxes due and payable by Sellers (whether or not shown on any Tax Return) have been paid in full. The accruals and reserves with respect to Taxes (other than any reserve for deferred Taxes established to reflect timing differences between book and Tax income) set forth on the Most Recent Balance Sheet are adequate to cover all Taxes of Sellers accruing or payable with respect to Tax Periods (or portions thereof) ending on or before the date of the Most Recent Balance Sheet. All Taxes of Sellers attributable to Tax Periods (or portions thereof) commencing after the date of the Most Recent Balance Sheet have arisen in the Ordinary Course of Business.

(c) Since January 1, 2010, no claim has been made against Sellers by any Governmental Body in a jurisdiction where Sellers do not file Tax Returns that Sellers are or may be subject to taxation in such jurisdiction.

5.13 Employees. Section 5.13 of the Seller Disclosure Schedule sets forth a true and correct list of the Employees as of the Execution Date, specifying their position, current wage rate or annual salary and target bonus, most recent annual bonus or commission, location of employment, employment status (i.e., active or inactive (and, if inactive, the reason for such status and expected date of return to active duty)) and date of hire. All of the individuals connected with the Business, whether or not characterized by Sellers as a contingent worker, independent contractor or leased employee have been properly classified by Sellers as an employee. No Seller is delinquent in payments to any Employees for any wages, salaries, commissions, bonuses or other direct compensation for any services performed for it or amounts required to be reimbursed to Employees. No Seller is a party to or bound by, either directly or by operation of Law, any collective bargaining agreement, labor contract, letter of understanding, letter of intent, voluntary recognition agreement or legally binding commitment or written communication to any labor union, trade union or employee organization or group which may qualify as a trade union in respect of or affecting Employees nor is any Seller subject to any union organization effort, or engaged in any labor negotiation.

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5.14 Seller Plans.

(a) A true and correct list of only those Seller Plans included in the Purchased Assets is set forth in Section 5.14(a) of the Seller Disclosure Schedule. The Seller Plans included in the Excluded Assets are included on Schedule 1.1(rr). The Seller has delivered to the Purchaser true and complete copies of (i) all Seller Plans and related trust agreements, annuity contracts, insurance policies or other funding instruments (including all Assumed Plans and all service agreements and insurance contracts relating thereto), (ii) the latest Internal Revenue Service determination or opinion letter obtained with respect to each Seller Plan qualified or exempt under Section 401 or 501 of the Code, as applicable, and the results of discrimination testing for the most recently completed three (3) fiscal years for each such Seller Plan, (iii) Forms 5500 and certified financial statements for the most recently completed three (3) fiscal years for each Seller Plan required to file such form, together with the most recent actuarial report, if any, prepared by the Seller Plan’s enrolled actuary, (iv) the current summary plan descriptions for each Seller Plan required to prepare, file and distribute summary plan descriptions, (v) all summaries furnished to Employees, officers or directors of each Seller of all incentive compensation, other plans and fringe benefits for which a summary plan description is not required and (vi) the form notifications to Employees of their rights under Section 4980B of the Code.

(b) None of the Seller Plans is a “multiemployer plan” (as defined in Section 3(37) of ERISA), is or has been subject to Sections 4063 or 4064 of ERISA, or is or has been subject to subject to Title IV of ERISA or Code Section 412 or 430. Neither Sellers nor any of their respective ERISA Affiliates have any Liability under Title IV of ERISA or Code Section 412 or 430. None of the Seller Plans is subject to any Laws outside of the United States. There are no Encumbrances under Section 412 or 430 of the Code or under ERISA on any of the Purchased Assets.

(c) Each Seller Plan has been established, administered and invested in accordance with its terms and in material compliance with all applicable Laws. Sellers have performed and complied in all material respects with all of their respective obligations under or with respect to the Seller Plans. Each Seller Plan that is intended to be a “qualified plan” within the meaning of Section 401(a) of the Code (“Qualified Plan”) and each trust that is intended to be exempt under Section 501 of the Code (“Exempt Trust”) has received a determination or opinion letter from the Internal Revenue Service to the effect that such Qualified Plan is so qualified and such Exempt Trust is so exempt, and, to the Knowledge of Sellers, nothing has occurred since the date of the most recent Internal Revenue Service determination or opinion letter, as applicable, that would materially and adversely affect the tax-qualified status of any Qualified Plan or Exempt Trust. There has not been any prohibited transaction (within the meaning of ERISA and the Code) with respect to any Seller Plan.

(d) Each Assumed Plan is a “welfare plan” subject to Section 3(2) of ERISA. Each type of welfare benefit provided under each Assumed Plan is listed in Section 5.14(d) of the Seller Disclosure Schedule. No Assumed Plan (or portion thereof) is self-insured or subject to a “stop-loss” insurance policy or contract. There are no participants in any Assumed Plan other than current or former Employees of the Business (and their beneficiaries and dependents). None of the Assumed Plans provide, or reflect or represent a Liability of the Business to provide, retiree health or other retiree welfare benefits to any current or former Employees of the Business for any reason, except as may be required by COBRA and Sellers have not agreed, promised or represented that they would provide retiree health or other retiree welfare benefits to any current or former Employees of the Business.

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5.15 Insurance Policies. Section 5.15 of the Seller Disclosure Schedule lists all insurance policies owned or held by Sellers or otherwise applicable to the Business (the “Insurance Policies”). All of such Insurance Policies shall be included in the Purchased Assets except for Sellers’ director and officer insurance policies, fiduciary policies or employment practices policies (in each case of the foregoing, including any tail policies or coverage thereon).

5.16 Vendors and Suppliers. Section 5.16 of the Seller Disclosure Schedule sets forth a list of all Significant Vendors/Suppliers. “Significant Vendors/Suppliers” are: (i) the 25 vendors and/or suppliers that have sold the most, in terms of dollar value, services to Sellers during the fiscal year ended December 25, 2010; and (ii) the 25 vendors and/or suppliers that have sold the most, in terms of dollar value, services to Sellers during the two month period ended February 28, 2011. Except as set forth in Section 5.16 of the Seller Disclosure Schedule, true, correct and complete copies of all written Contracts (other than purchase orders) with Significant Vendors/Suppliers have been provided to the Purchaser.

5.17 Accounts Receivable. Section 5.17 of the Seller Disclosure Schedule sets forth a complete and accurate list, of the Accounts Receivable of Sellers, as of the date set forth in such Accounts Receivable report provided to Purchaser prior to the date.

5.18 Financial Statements. Sellers have delivered or made available to the Purchaser the following financial statements (collectively the “Financial Statements”): (a) audited consolidated balance sheets and statements of income, changes in stockholders’ equity and cash flow as of and for the fiscal year ended December 26, 2009 for HUSA (the “2009 Audited Financial Statements”), (b) audited consolidated balance sheets and statements of income, changes in stockholders’ equity, and cash flow as of and for the fiscal year ended December 25, 2010 for HUSA (the “2010 Audited Financial Statements”), and (c) an unaudited consolidated balance sheet as of April 2, 2011 (the “Most Recent Balance Sheet”) for HUSA, which Most Recent Balance Sheet is set forth in Section 5.18 of the Seller Disclosure Schedule. The 2009 Audited Financial Statements, the 2010 Audited Financial Statements and the Most Recent Balance Sheet have been prepared in accordance with GAAP applied on a consistent basis throughout the periods involved, present fairly, in all material respects, the financial condition of HUSA as of such dates and the results of operations and cash flows of HUSA for such periods, and are consistent, in all material respects, with the books and records of HUSA.

5.19 Absence of Undisclosed Liabilities. Except as set forth in Section 5.19 of the Seller Disclosure Schedule, to Sellers' Knowledge, Sellers do not have any Liabilities, except (a) Liabilities reflected on the liabilities side of the Most Recent Balance Sheet, (b) Liabilities that have arisen after the date of the Most Recent Balance Sheet in the Ordinary Course of Business or otherwise in accordance with the terms and conditions of this Agreement (none of which is a material Liability for breach of warranty, tort or infringement or a claim or lawsuit or breach of an Environmental Law) and (c) Liabilities that are or will be Excluded Liabilities.

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ARTICLE VI

REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

The Purchaser hereby makes the representations and warranties in this Article VI to Sellers as of the Execution Date (except with respect to representations and warranties made as of a particular date, which shall be deemed to be made only as of such date), except as qualified or supplemented by Sections in the disclosure schedule delivered by Purchaser to Sellers prior to the execution and delivery of this Agreement, which identifies exceptions only by the specific Section or subsection to which each entry relates (the “Purchaser Disclosure Schedule”).

6.1 Corporate Organization and Qualification. The Purchaser is a limited liability company duly organized, validly existing and in good standing under the Laws of its jurisdiction of formation. The Purchaser is, or will as of the Closing Date be, qualified and in good standing as a foreign entity in the State of Florida. The Purchaser has all requisite power and authority (corporate or otherwise) to own its properties and to carry on its business as it is now being conducted.

6.2 Authority Relative to This Agreement. The Purchaser has the requisite corporate power and authority to (a) execute and deliver this Agreement, (b) execute and deliver each other agreement, document, instrument or certificate contemplated by this Agreement (the “Purchaser’s Documents”), and (c) perform its obligations hereunder and thereunder and consummate the transactions contemplated hereby and thereby. The execution, delivery and performance by the Purchaser of this Agreement and each of the Purchaser’s Documents have been duly authorized by all necessary corporate action on behalf of the Purchaser. This Agreement has been, and at or prior to the Closing each of the Purchaser’s Documents will be, duly and validly executed and delivered by the Purchaser and (assuming the due authorization, execution and delivery by the other parties hereto and thereto) this Agreement constitutes, and each of the Purchaser’s Documents when so executed and delivered will constitute, legal, valid and binding obligations of the Purchaser, enforceable against the Purchaser in accordance with their respective terms, subject to the Bankruptcy Exceptions.

6.3 Consents and Approvals; No Violation.

(a) Except as set forth in Section 6.3(a) of the Purchaser Disclosure Schedule, none of the execution and delivery by the Purchaser of this Agreement or the Purchaser’s Documents, the consummation of the transactions contemplated hereby or thereby, or the compliance by the Purchaser with any of the provisions hereof or thereof will conflict with, or result in any violation of or default (with or without notice or lapse of time, or both) under, or give rise to a right of acceleration, payment, amendment, termination or cancellation under any provision of (i) the certificate of formation and the limited liability agreement (or similar organizational documents) of the Purchaser, (ii) any order of any Governmental Body applicable to the Purchaser or by which any of the properties or assets of the Purchaser are bound, or (iii) any applicable Law.

(b) Except (i) as set forth in Section 6.3(b) of the Purchaser Disclosure Schedule and (ii) as required to comply with the HSR Act, no consent, waiver, approval, order, Permit or authorization of, or declaration or filing with, or notification to, any Governmental Body or other Person nor any other Regulatory Approval is required on the part of the Purchaser in connection with the execution and delivery of this Agreement or the Purchaser’s Documents, the compliance by the Purchaser with any of the provisions hereof or thereof, the consummation of the transactions contemplated hereby or thereby or the taking by the Purchaser of any other action contemplated hereby or thereby.

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6.4 Brokers and Finders. Except as set forth in Section 6.4 of the Purchaser Disclosure Schedule, the Purchaser has not employed, and to the knowledge of the Purchaser, no other Person has made any arrangement by or on behalf of the Purchaser with, any investment banker, broker, finder, consultant or intermediary in connection with the transactions contemplated by this Agreement which would be entitled to any investment banking, brokerage, finder’s or similar fee or commission in connection with this Agreement or the transactions contemplated hereby.

6.5 Adequate Assurances Regarding Assigned Contracts. As of the Closing, the Purchaser will be capable of satisfying the conditions contained in Sections 365(b)(1)(C) and 365(f) of the Bankruptcy Code with respect to the Assigned Contracts.

6.6 Sufficiency of Financing. The Purchaser will have, on the Execution Date and on the Closing Date, the committed financing necessary to consummate the transactions contemplated by this Agreement.

6.7 Investigation. The Purchaser has conducted its own independent review and analysis of the Business, the Purchased Assets and the Assumed Liabilities, of the value of such Purchased Assets and of the business, operations, technology, assets, Liabilities, financial condition and prospects of the Business, and the Purchaser acknowledges that Sellers have provided the Purchaser with access to the personnel, properties, premises and records of the Business for this purpose. The Purchaser has conducted its own independent review of all orders of, and all motions, pleadings, and other submissions to, the Bankruptcy Court in connection with the Chapter 11 Case. In entering into this Agreement, the Purchaser has relied upon its own investigation and analysis as well as the representations and warranties made by Sellers in Article V, and the Purchaser acknowledges that neither Sellers nor any of their Affiliates makes or has made any representation or warranty, either express or implied, as to the accuracy or completeness of any of the information provided or made available to the Purchaser or any of its Affiliates, except as and only to the extent expressly set forth in Article V.

ARTICLE VII

EMPLOYEES

7.1 Employee Matters. No later than ten (10) days prior to the Closing, Sellers will deliver to the Purchaser an updated Section 5.13 of the Seller Disclosure Schedule. Immediately prior to the Closing, Sellers shall terminate the employment of each Employee. The Purchaser may offer employment to such of the Employees of Sellers as of the Closing as may be selected by the Purchaser in its sole discretion, and such employment offers shall be on such terms and conditions as may be acceptable to the Purchaser in its sole discretion and need not bear any relationship to terms and provisions applicable to their employment by Sellers. Each Employee to whom the Purchaser has made an offer of employment pursuant to this Section 7.1 and that has accepted such offer and commences employment with the Purchaser or its Affiliates on or following the Closing Date is hereinafter referred to as a “Transferred Employee”; provided, however, that each Employee to whom the Purchaser has made an offer of employment pursuant to this Section 7.1 who is on a leave of absence as of the Closing Date shall not become a Transferred Employee unless such Employee returns to active service within six (6) months following the Closing Date. The Purchaser shall not assume any Accrued Employee Obligations other than in connection with Assumed Plans, whether accruing prior to, on or after the Petition Date.

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7.2 Excluded Plans. Sellers shall be solely responsible for and shall retain all Liabilities with respect to the Excluded Plans and the Accrued Employee Obligations.

7.3 COBRA Coverage. The Purchaser shall be responsible for, and shall assume all Liabilities in respect of, the provision of continued medical coverage pursuant to its group health plans for employees under Part 6, Title I of ERISA and Section 4980B of the Code (“COBRA Continuation Coverage”), for all current and former Employees of Sellers who are “M&A qualified beneficiaries” (as defined in Treas. Reg. Sec. 54.4980B-9) with respect to any “qualifying event” (within the meaning of COBRA) incurred on or prior to the Closing Date or otherwise arising as a result to the transactions described herein if Sellers and their ERISA Affiliates cease to provide any group health plan to any Employee in connection with the sale of the Business to the Purchaser. Immediately prior to the Closing, Sellers will provide to the Purchaser a list of all Employees (i) terminated by Sellers within the ninety (90) days immediately preceding the Closing, and (ii) receiving COBRA Continuation Coverage on the Closing Date.

7.4 WARN Act Liability. Sellers shall be solely responsible for any obligations under the Worker Adjustment and Retraining Notification Act of 1988, 29 U.S.C. §2101 et seq. (the “WARN Act”), or under any similar provision of any federal, state, provincial, regional, foreign or local Law, rule or regulation that might arise on or prior to the Closing Date, or as a consequence of the transactions contemplated by this Agreement, including, without limitation, providing any notice of layoff or plant closing, or maintaining the Employees on Sellers’ payroll for any period of notice required by the WARN Act. Sellers shall retain all Liabilities, if any, for any severance or termination costs relating to Employees who, on or at the Closing Date, experience a termination of employment by Sellers as a result of the transactions contemplated by this Agreement.

7.5 No Third-Party Beneficiaries.

(a) Notwithstanding anything set forth in this Article VII, nothing contained herein, whether express or implied, (i) shall be treated as an amendment or other modification of any Seller Plan or (ii) shall limit the right of the Purchaser or any of its Affiliates to amend, terminate or otherwise modify any Assumed Plan following the Closing Date.

(b) Sellers and the Purchaser acknowledge and agree that all provisions contained in this Article VII with respect to current or former Employees are included for the sole benefit of Sellers and the Purchaser, and that nothing herein, whether express or implied, shall create any third party beneficiary or other rights (i) in any other Person, including, without limitation, any current or former employees, directors, officers or consultants of Sellers, any participant in Seller Plan, or any dependent or beneficiary thereof, or (ii) to continued employment with the Purchaser or any of its Affiliates.

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7.6 Payment of Certain Employee Obligations. In order to facilitate the retention by Purchaser of certain existing employees of Sellers, Sellers acknowledge that the Purchaser has required Sellers, and Sellers hereby agree, to pay the Employee Obligations listed on Schedule 7.6 attached hereto at, or as soon as practicable after, the Closing using a portion of the Cash Balance.”

ARTICLE VIII

BANKRUPTCY COURT MATTERS

8.1 Competing Bid and Other Matters.

(a) This Agreement and the transactions contemplated hereby are subject to approval of the Bankruptcy Court and Sellers’ right and ability to consider higher or better competing bids with respect to the Business and a material portion of the Purchased Assets pursuant to the Bidding Procedures Order (each a “Competing Bid”).

(b) Sellers shall have the responsibility and obligation to respond to any inquiries or offers to purchase all or any part of the Business, and perform any and all other acts related thereto which are required under the Bankruptcy Code or other applicable Law, including, without limitation, supplying information relating to the Business and the assets of Sellers to prospective purchasers.

(c) Sellers shall promptly serve true and correct copies of the Sale Motion and all related pleadings in accordance with the Bidding Procedures Order, the Bankruptcy Code, the Bankruptcy Rules, the Local Rules for the United States Bankruptcy Court for the Southern District of Florida and any other applicable order of the Bankruptcy Court.

8.2 Sale Order. The Sale Order shall be entered by the Bankruptcy Court on or before the first business day after August 4, 2011 substantially in the form attached hereto as Exhibit C and otherwise in form and substance acceptable to Sellers and the Purchaser. The Sale Order shall, among other things, (a) approve, pursuant to Sections 105, 363 and 365 of the Bankruptcy Code, (i) the execution, delivery and performance by HUSA of this Agreement, (ii) the sale by HUSA of the Purchased Assets (other than the Auxiliary Health Assets (hereinafter defined)) to the Purchaser on the terms set forth herein and free and clear of all Encumbrances (other than Encumbrances included in the Assumed Liabilities and Permitted Encumbrances), and (iii) the performance by HUSA of its obligations under this Agreement; (b) authorize and empower HUSA to assume and assign to the Purchaser the Assigned Contracts; and (c) find that the Purchaser is a “good faith” buyer within the meaning of Section 363(m) of the Bankruptcy Code, not a successor to HUSA and grant the Purchaser the protections of Section 363(m) of the Bankruptcy Code. The Purchaser agrees that it will promptly take such actions as are reasonably requested by HUSA to assist in obtaining Bankruptcy Court approval of the Sale Order, including, without limitation, furnishing affidavits or other documents or information for filing with the Bankruptcy Court for purposes, among others, of (a) demonstrating that the Purchaser is a “good faith” purchaser under Section 363(m) of the Bankruptcy Code and (b) establishing adequate assurance of future performance within the meaning of Section 365 of the Bankruptcy Code. In the event that the Bankruptcy Court’s approval of the Sale Order shall be appealed, Sellers shall use reasonable efforts to defend such appeal. As used herein, the term “Auxiliary Health Assets” shall mean the collective reference of all assets of Auxiliary Health which are being transferred by Auxiliary Health to Purchaser as a portion of the Purchased Assets.

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ARTICLE IX

COVENANTS AND AGREEMENTS

9.1 Conduct of Business of Sellers. During the period from the Execution Date and continuing until the earlier of the termination of this Agreement in accordance with Section 4.4 or the Closing, except (1) for any limitations on operations imposed by the Bankruptcy Court or the Bankruptcy Code, (2) as required by applicable Law, (3) as otherwise expressly contemplated by this Agreement or (4) with the prior written consent of the Purchaser (such consent not to be unreasonably withheld, conditioned or delayed), Sellers shall conduct the Business and operate and maintain the Purchased Assets in the Ordinary Course of Business.

9.2 Access to Information.

(a) Sellers agree that, between the Execution Date and the earlier of the Closing Date and the date on which this Agreement is terminated in accordance with Section 4.4, the Purchaser shall be entitled, through its officers, employees, counsel, accountants and other authorized representatives, agents and contractors (“Representatives”), to have such reasonable access to and make such reasonable investigation and examination of the books and records, properties, businesses, assets, Employees, accountants, auditors, counsel and operations of Sellers as the Purchaser’s Representatives may reasonably request. Any such investigations and examinations shall be conducted during regular business hours upon reasonable advance notice and under reasonable circumstances, including Sellers’ right to have its Representative accompany the Purchaser upon the Leased Real Property at the time of any inspection or examination and shall be subject to restrictions under applicable Law. Pursuant to this Section 9.2, Sellers shall furnish to the Purchaser and its Representatives such financial, operating and property related data and other information as such Persons reasonably request. Sellers shall use commercially reasonable efforts to cause their Representatives to reasonably cooperate with the Purchaser and the Purchaser’s Representatives in connection with such investigations and examinations, and the Purchaser shall, and shall use its commercially reasonably efforts to cause its Representatives to, reasonably cooperate with Sellers and their respective Representatives and shall use their reasonable efforts to minimize any disruption to the Business; provided, however, that the access granted to the Representatives pursuant to this Agreement shall not constitute nor be construed as a waiver of any applicable legal privilege of Sellers, including the attorney-client privilege.

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(b) From and after the Closing Date, Sellers shall give the Purchaser and the Purchaser’s Representatives reasonable access during normal business hours to the offices, facilities, plants, properties, assets, Employees, Documents (including, without limitation, any Documents included in the Excluded Assets), personnel files and books and records of Sellers pertaining to the Business. In connection with the foregoing, Sellers shall use commercially reasonable efforts to cause their Representatives to furnish to the Purchaser such financial, technical, operating and other information pertaining to the Business as the Purchaser’s Representatives shall from time to time reasonably request and to discuss such information with such Representatives. Without limiting the generality of the foregoing, Sellers shall, and shall use commercially reasonable efforts to cause each of their Affiliates to, cooperate with the Purchaser as may reasonably be requested by the Purchaser for purposes of (i) enabling an independent accounting firm selected by the Purchaser to conduct an audit of the Business, including access to HUSA’s independent auditors’ working papers pertaining to the Business or the Purchased Assets including any environmental assessment; (ii) undertaking, with the consent of HUSA, which consent shall not be unreasonably withheld or delayed, any study of the condition or value of the Purchased Assets; and (iii) undertaking any study relating to Sellers’ compliance with Laws; and Sellers acknowledges that information or access may be requested and used for such purpose.

(c) From and after the Closing Date, the Purchaser shall give Sellers and Sellers’ Representatives reasonable access during normal business hours to the offices, facilities, plants, properties, assets, Employees, Documents (including, without limitation, any Documents included in the Purchased Assets), personnel files and books and records of the Purchaser pertaining to (i) the conduct of the Business or ownership of the Purchased Assets prior to the Closing Date or (ii) the Excluded Assets and the Excluded Liabilities; provided, however, that the access granted to Sellers’ Representatives pursuant to this Section 9.2(c) shall not include access to materials that are protected by attorney-client privilege or any other applicable legal privilege. In connection with the foregoing, the Purchaser shall use commercially reasonable efforts to cause its Representatives to furnish to Sellers such financial, technical, operating and other information pertaining to (i) the conduct of the Business or ownership of the Purchased Assets prior to the Closing Date or (ii) the Excluded Assets and the Excluded Liabilities, in each case, as Sellers’ Representatives shall from time to time reasonably request and to discuss such information with such Representatives. Without limiting the generality of the foregoing, the Purchaser shall, and shall use commercially reasonable efforts to cause each of its Affiliates to, cooperate with Sellers as may reasonably be requested by Sellers for purposes of enabling an independent accounting firm selected by Sellers to conduct an audit of the Business for periods prior to the Closing Date, including access to the Purchaser’s independent auditors’ working papers pertaining to the Business or the Purchased Assets prior to the Closing Date.

9.3 Assignability of Certain Contracts, Other Purchased Assets, Etc. To the extent that the assignment to the Purchaser of any Assigned Contract or other Purchased Assets pursuant to this Agreement is not permitted without the consent of a third party and such restriction cannot be effectively overridden or canceled by the Sale Order or other related order of the Bankruptcy Court, then, this Agreement will not be deemed to constitute an assignment of or an undertaking or attempt to assign such Assigned Contract, other Purchased Assets or any right or interest therein unless and until such consent is obtained and such failure to obtain such consents shall not constitute a condition to Closing under this Agreement; provided, however, that the parties hereto will use their commercially reasonable efforts, before the Closing, to obtain all such consents; provided, further, that if any such consents are not obtained prior to the Closing Date, Sellers and the Purchaser will reasonably cooperate with each other in any lawful and feasible arrangement designed to provide the Purchaser (such arrangement to be at the sole cost and expense of the Purchaser) with the benefits and obligations of any such Assigned Contract and other Purchased Assets and the Purchaser shall be responsible for performing all obligations under such Assigned Contract and other Purchased Assets required to be performed by Sellers on or after the Closing Date to the extent that if such Assigned Contract and other Purchased Assets were assumed by the Purchaser as of the Closing Date the obligations thereunder would have constituted an Assumed Liability.

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9.4 Preservation of Records. Sellers and the Purchaser agree that each of them shall preserve and keep the records held by them or their Affiliates relating to the Business, the Purchased Assets and Assumed Liabilities for a period of five (5) years from the Closing Date at the Purchaser’s sole cost, in the case of the Purchaser, and until the closing of the Chapter 11 Case or the liquidation and winding up of Sellers’ estates, in the case of Sellers, and shall make such records available to the other party as may be reasonably required by such other party in connection with, among other things, any insurance claims by, actions or tax audits against or governmental investigations of Sellers or the Purchaser or any of their respective Affiliates or in order to enable Sellers or the Purchaser to comply with their respective obligations under this Agreement and each other agreement, document or instrument contemplated hereby or thereby. In the event Sellers or the Purchaser wishes to destroy such records at the end of such applicable period, such party shall first give sixty (60) days prior written notice to the other party and such other party shall have the right at its option and expense, upon prior written notice given to such party within such sixty (60) day period, to take possession of the records within one hundred and twenty (120) days after the date of such notice, or such shorter period as the liquidation and winding up of Sellers’ estates shall permit.

9.5 Publicity. Sellers or the Purchaser may issue a press release or public announcement concerning this Agreement or the transactions contemplated hereby only with the prior written approval of the other parties hereto; provided, however, if such disclosure is otherwise required by applicable Law or by the Bankruptcy Court with respect to filings to be made with the Bankruptcy Court in connection with this Agreement or by the Securities and Exchange Commission and/or the NYSE Amex rules and regulations governing public disclosure by publically traded companies, any approval shall not be unreasonably withheld, conditioned or delayed.

9.6 DIP Loan Documents. Notwithstanding anything in this Agreement to the contrary, between the date of this Agreement and the earlier of the termination of this Agreement in accordance with Section 4.4 and the Closing Date, it shall not be a breach of this Agreement for, and nothing in this Agreement shall (or shall be deemed to) limit or affect the ability of, Sellers to incur Indebtedness or borrow funds under the DIP Loan Documents, including, without limitation, for the purpose of paying Cure Costs in accordance with the terms and conditions of the DIP Loan Documents.

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9.7 Regulatory Approvals.

(a) To the extent required to comply with the HSR Act, as soon as reasonably practicable following execution of this Agreement (but in any event prior to thirty (30) days following the execution and delivery of this Agreement), each of the Purchaser and Sellers shall (i) make or cause to be made all filings required of each of them under the HSR Act with respect to the transactions contemplated hereby, with the fees for all such filings being paid by the Purchaser, (ii) comply at the earliest practicable date with any request under the HSR Act, the Sherman Act, as amended, the Clayton Act, as amended, the Federal Trade Commission Act, as amended, and any other United States federal or state or foreign statutes, rules, regulations, orders, decrees, administrative or judicial doctrines or other Laws that are designed to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade (collectively, the “Antitrust Laws”) for information, documents, or other materials received by each of them or any of their respective subsidiaries from the Federal Trade Commission (the "FTC"), the Department of Justice (the "DOJ") or any other Governmental Body in respect of such filings or such transactions, and (iii) cooperate with each other in connection with any such filing (including, to the extent permitted by applicable Law, providing copies of all such documents to the non-filing parties prior to filing and considering all reasonable additions, deletions or changes suggested in connection therewith) and in connection with resolving any investigation or other inquiry of any of the FTC, the DOJ or other Governmental Body under any Antitrust Laws with respect to any such filing or any such transaction; provided, however, that no party hereto shall be required to provide any other party with copies of confidential documents or information included in its filings and submissions under the HSR Act, and provided, further, that a party hereto may request entry into a joint defense agreement as a condition to providing any such materials and that, upon receipt of that request, the parties shall work in good faith to enter into a joint defense agreement to create and preserve attorney-client privilege in a form and substance mutually acceptable to the parties.

(b) Subject to the provisions of this Section 9.7, each party shall use commercially reasonable efforts to furnish to the other all information required for any application or other filing to be made pursuant to any applicable Law in connection with the transactions contemplated by this Agreement. Subject to the provisions of this Section 9.7, each party shall promptly inform the other parties hereto of any oral communication with, and provide copies of written communications with, any Governmental Body regarding any such filings or any such transaction. No party hereto shall independently participate in any formal meeting with any Governmental Body in respect of any such filings, investigation, or other inquiry without giving the other parties hereto prior notice of the meeting and, to the extent permitted by such Governmental Body, the opportunity to attend and/or participate. Subject to applicable Law, the parties hereto will consult and cooperate with one another in connection with any analyses, appearances, presentations, memoranda, briefs, arguments, opinions and proposals made or submitted by or on behalf of any party hereto relating to proceedings under the HSR Act or other Antitrust Laws. Sellers and the Purchaser may, as each deems advisable and necessary, reasonably designate any competitively sensitive material provided to the other under this Section 9.7 as “outside counsel only.” Such materials and the information contained therein shall be given only to the outside legal counsel of the recipient and will not be disclosed by such outside counsel to employees, officers, or directors of the recipient, unless express written permission is obtained in advance from the source of the materials (Sellers or the Purchaser, as the case may be).

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(c) Each of the Purchaser and Sellers shall use commercially reasonable efforts to take such action as may be required to cause the expiration of the notice periods under the HSR Act or other Antitrust Laws with respect to such transactions as promptly as possible after the execution of this Agreement. Notwithstanding anything to the contrary provided in this Section 9.7, neither the Purchaser nor any of its Affiliates shall be required (i) to hold separate (including by trust or otherwise) or divest or otherwise dispose of, sell, assign or transfer any of its businesses, product lines, assets, investments, securities or rights of any kind or any of the Purchased Assets, or to enter into any consent decree or settlement agreement with any Governmental Body, (ii) to agree to any limitation on the operation or conduct of the Business, (iii) to waive any of the conditions to this Agreement set forth in Sections 10.1 or 10.3, (iv) to waive its right to terminate this Agreement under Section 4.4 or (v) to defend, contest or resist any action or proceeding or seek to have vacated, lifted, reversed or overturned any decree, judgment, injunction or other order, whether temporary, preliminary or permanent, that is in effect and that prohibits, prevents or restricts consummation of the transactions contemplated by this Agreement.

9.8 No Due Diligence Contingency. Subject to Article X, upon the execution and delivery of this Agreement by Sellers and the Purchaser, the Purchaser shall have no “due diligence contingency” under this Agreement and the Purchaser shall not be entitled to terminate this Agreement and receive the return of the Deposit because the Purchaser discovered facts concerning Sellers and/or the Business after the date hereof.

9.9 No Financing Contingency. Upon the execution and delivery of this Agreement by Sellers and the Purchaser, the Purchaser shall have no “financing contingency” under this Agreement and the Purchaser shall not be entitled to terminate this Agreement and receive the return of the Deposit because the Purchaser fails to secure sufficient financing to pay the Purchase Price.

9.10 Use of Name. Within ten (10) days after the Closing Date, Sellers shall take such corporate and other actions necessary to change its corporate or company name, as the case may be, to a name that is not similar to, or confusing with, the current names of Sellers, including any necessary filings required by the general corporation or other law of the states in which such Sellers are incorporated, or otherwise organized.

9.11 Further Assurances.

(a) From time to time after the Closing, without additional consideration, each of the parties hereto will (or, if appropriate, cause their Affiliates to) execute and deliver such further instruments and take such other action as may be necessary to make effective the transactions contemplated by this Agreement. If any party to this Agreement shall following the Closing have in its possession any asset, right or payment that under this Agreement should have been delivered to the other, such party shall promptly deliver such asset, right or payment to the other party.

(b) Each Sellers, on behalf of itself and its respective Affiliates, hereby constitutes and appoints, effective as of the Closing Date, Purchaser and its successors and assigns as the true and lawful attorney of such Seller or its Affiliates, as applicable, with full power of substitution in the name of Purchaser, or in the name of such Seller or its respective Affiliates, as applicable, but for the benefit of Purchaser, (i) to collect for the account of Purchaser any items of Purchased Assets and (ii) to institute and prosecute all proceedings that Purchaser may in its sole discretion deem proper to assert or enforce any right, title or interest in, to or under the Purchased Assets, and to defend or compromise any and all actions, suits or proceedings in respect of the Purchased Assets. Purchaser shall be entitled to retain for its own account any amounts collected pursuant to the foregoing powers, including any amounts payable as interest in respect thereof.

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ARTICLE X

CONDITIONS TO CLOSING

10.1 Conditions Precedent to the Obligations of the Purchaser and Sellers. The respective obligations of each party to this Agreement to consummate the transactions contemplated by this Agreement are subject to the satisfaction or written waiver, on or prior to the Closing Date, of each of the following conditions (any or all of which may be waived in writing by Sellers and the Purchaser in whole or in part to the extent permitted by applicable Law):

(a) there shall not be in effect any statute, rule, regulation, executive order enacted, issued, entered or promulgated by a Governmental Body of competent jurisdiction restraining, enjoining or otherwise prohibiting the consummation of the transactions contemplated hereby;

(b) the waiting period (and any extension thereof) applicable to the transactions contemplated by this Agreement under the HSR Act shall have been terminated or shall have expired;

(c) the Bankruptcy Court shall have entered the Sale Order (as provided in Article VIII) and in form and substance reasonably satisfactory to Sellers and the Purchaser.

10.2 Conditions Precedent to the Obligations of Sellers. The obligations of Sellers to consummate the transactions contemplated by this Agreement are subject to the fulfillment, on or prior to the Closing Date, of each of the following conditions (any or all of which may be waived in writing by Sellers in whole or in part to the extent permitted by applicable Law):

(a) the representations and warranties of the Purchaser set forth in Article VI hereof shall be true and correct as of the Closing Date as though made on and as of the Closing Date (except for such representations and warranties made as of a certain date, which shall be true and correct as of such date as though made on and as of such date) except where the failure of such representations or warranties to be true and correct (without giving effect to any limitation or qualification as to “materiality” or “material adverse effect” set forth in such representations and warranties) has not had and would not reasonably be expected to have, individually or in the aggregate, a material adverse effect on the Purchaser’s ability to consummate the transactions contemplated hereby, and Sellers shall have received a certificate signed by an authorized officer of the Purchaser, dated the Closing Date, to the foregoing effect;

(b) the Purchaser shall have performed and complied in all material respects with all obligations and agreements required by this Agreement to be performed or complied with by the Purchaser on or prior to the Closing Date, and Sellers shall have received a certificate signed by an authorized officer of the Purchaser, dated the Closing Date, to the foregoing effect;

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(d) all portions of the Purchase Price shall have been delivered in accordance with Section 3.1; and

(e) the Purchaser shall have delivered to Sellers appropriate evidence of all necessary corporate action by the Purchaser in connection with the transactions contemplated hereby, including, without limitation: (i) certified copies of resolutions duly adopted by the Purchaser’s governing body approving the transactions contemplated by this Agreement and authorizing the execution, delivery, and performance by the Purchaser of this Agreement; and (ii) a certificate as to the incumbency of officers of the Purchaser executing this Agreement and any instrument or other document delivered in connection with the transactions contemplated by this Agreement.

10.3 Conditions Precedent to the Obligations of the Purchaser. The obligations of the Purchaser to consummate the transactions contemplated by this Agreement are subject to the fulfillment, on or prior to the Closing Date, of each of the following conditions (any or all of which may be waived in writing by the Purchaser in whole or in part to the extent permitted by applicable Law):

(a) Sellers shall have delivered to the Purchaser (i) a copy of the Sale Order, after the Sale Order becomes a Final Order (which shall contain the terms described in Section 8.2) and (ii) copies of all affidavits of service of the Sale Motion or notice of such motion filed by or on behalf of Sellers);

(b) the representations and warranties of Sellers set forth in Article V hereof shall be true and correct as of the Closing Date as though made on and as of the Closing Date (except for such representations and warranties made as of a certain date, which shall be true and correct as of such date as though made on and as of such date) except where the failure of such representations or warranties to be true and correct (without giving effect to any limitation or qualification as to “materiality” or “material adverse effect” set forth in such representations and warranties) has not had and would not reasonably be expected to have, individually or in the aggregate, a material adverse effect on Sellers or Sellers’ ability to consummate the transactions contemplated hereby, and the Purchaser shall have received a certificate signed by an authorized officer of HUSA, dated the Closing Date, to the foregoing effect;

(c) Sellers shall have performed and complied in all material respects with all obligations and agreements required in this Agreement to be performed or complied with by them on or prior to the Closing Date, and the Purchaser shall have received a certificate signed by an authorized officer of HUSA, dated the Closing Date, to the forgoing effect; and

(d) Sellers shall have delivered, or caused to be delivered, to the Purchaser all of the items set forth in Section 4.2.

10.4 Frustration of Closing Conditions. Neither Sellers nor the Purchaser may rely on the failure of any condition set forth in Sections 10.1, 10.2 or 10.3, as the case may be, if such failure was caused directly by such party’s failure to comply with any provision of this Agreement in any material respect.

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10.5 Cure of Breach of Representation or Warranty by Sellers or Purchaser. In the event either Sellers or the Purchaser discovers prior to the Closing Date that the other party (such party, the “Breaching Party”) has breached any representation or warranty set forth in this Agreement, then, such party shall send to the Breaching Party written notice of such breach prior to the Closing Date. Subject to the provisions of Article IV, the Breaching Party shall be entitled to modify or supplement the representations and warranties set forth in this Agreement to cure such breach of such representation and warranty up to the Closing Date by sending written notice of such modification or supplementation to such representation or warranty to the other party on or prior to the Closing Date and, if such breach is cured by such notice on or prior to the Closing Date, then, the conditions to closing set forth in Sections 10.2(a) and Section 10.3(b) shall be deemed to have been satisfied for all purposes.

ARTICLE XI

TAXES

11.1 Additional Tax Matters.

(a) Any sales, use, purchase, transfer, franchise, deed, fixed asset, stamp, documentary stamp, use or other Taxes and recording charges which may be payable by reason of the sale of the Purchased Assets or the assumption of the Assumed Liabilities under this Agreement or the transactions contemplated herein shall be borne and timely paid by the Purchaser (collectively, the “Transfer Taxes”), and the Purchaser shall indemnify, defend (with counsel reasonably satisfactory to the Purchaser), protect, and save and hold Sellers harmless from and against any and all claims, charges, interest or penalties assessed, imposed or asserted in relation to any such Transfer Taxes.

(b) The Purchaser shall, within one-hundred twenty (120) days after the Closing Date, prepare and deliver to HUSA a schedule allocating the Purchase Price (and any other items that are required for federal income tax purposes to be treated as part of the purchase price) among the Purchased Assets (such schedule, the “Allocation”). If HUSA raises any objection to the Allocation within twenty (20) days of the receipt thereof, the Purchaser and HUSA will negotiate in good faith to resolve such objection(s); provided however, the Purchaser and HUSA are not required to negotiate the treatment of any amount associated with Section 3.1(a)(iii). If the Purchaser, Sellers and HUSA are unable to agree upon an Allocation, they are not required to report and file any Tax Returns (including Form 8594 under Section 1060 of the Code) in a manner consistent with the Allocation but shall provide the other party prior written notice of such intention. Subject to the foregoing, the Purchaser, Sellers and HUSA shall cooperate in the filing of any forms (including Form 8594 under Section 1060 of the Code) with respect to such Allocation, including any amendments to such forms required pursuant to this Agreement with respect to any adjustment to the Purchase Price. Notwithstanding any other provision of this Agreement, the terms and provisions of this Section 11.1(b) shall survive the Closing without limitation.

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ARTICLE XII

MISCELLANEOUS

12.1 Payment of Expenses. Except as otherwise provided in this Agreement or in the DIP Loan Documents and whether or not the transactions contemplated hereby are consummated, Sellers and the Purchaser shall, subject to Section 12.12 below, bear their own expenses incurred or to be incurred in connection with the negotiation and execution of this Agreement and each other agreement, document and instrument contemplated by this Agreement and the consummation of the transactions contemplated hereby and thereby.

12.2 Survival of Representations and Warranties; Survival of Confidentiality. The parties hereto agree that the representations and warranties contained in this Agreement shall expire upon the Closing Date. The parties hereto agree that the covenants contained in this Agreement to be performed at or after the Closing shall survive in accordance with the terms of the particular covenant or until fully performed.

12.3 Guarantee.

(a) Parent hereby absolutely, irrevocably and unconditionally guarantees to Sellers the due payment by the Purchaser of all of the Purchaser’s payment obligations under Article III of this Agreement and all of the Assumed Liabilities assumed by the Purchaser pursuant to Section 2.3 of this Agreement (the "Guaranteed Obligations"); provided, however, that Parent’s obligation pursuant to this Section 12.3(a) shall in no event exceed Two Hundred Million Dollars ($200,000,000.00) in the aggregate.

(b) Parent’s obligation pursuant to this Section 12.3(a) shall terminate on the earlier of (i) the five (5) year anniversary of the Sale Order or (ii) the date of final liquidation or dissolution of Sellers (such date, as determined, the "Termination Date"), and Parent shall have no further obligations hereunder except as to a claim for payment of any Guaranteed Obligation presented by Sellers to Parent prior to such Termination Date, in which case, Parent shall remain liable until the claim is paid in full or otherwise resolved.

(c) Any request for payment by Parent to Sellers shall be in writing and shall state with reasonable particularity the reasons for the payment request. This guarantee is an unconditional guarantee of payment, not collection, and a separate action or actions may be brought and prosecuted against Parent irrespective of whether any action is brought against the Purchaser and irrespective of whether the Purchaser is joined in any such action or actions. In addition to Parent’s obligations under this Section 12.3, Parent shall be legally bound by the terms and provisions of Article XII of this Agreement to the same extent as the Purchaser is bound by the terms and provisions of Article XII and each reference to “the Purchaser” in Article XII shall be deemed to include “Parent” and “the Purchaser” for all purposes. Parent hereby waives and releases any claim or other right Parent may have or hereafter acquire against the Purchaser or that arises from the existence or performance of Parent’s obligations under this Section 12.3, including without limitation any right of subrogation, setoff, exoneration, contribution or indemnification, or any right of participation in any claim or remedy of Sellers against the Purchaser under this Agreement. It is the intent and purpose hereof that Parent shall be not entitled to any defenses available to guarantors, sureties and other secondary parties at law or in equity (other than the timely and complete performance of the guaranteed obligations by the Purchaser). Sellers shall not be bound to exhaust its recourse against the Purchaser before being entitled to demand and receive Parent’s full and timely performance of this guarantee pursuant to this Section 12.3. So long as the Purchaser shall have not fully paid, performed or discharged all of its obligations under this Agreement, any claim which Parent may have against the Purchaser by reason of any payment to Sellers pursuant to this Section 12.3 shall not be asserted or enforced or collected as against (or to the detriment of) the Purchaser, as the case may be (including without limitation any liquidator, trustee in bankruptcy, assignee for the benefit of creditors or receiver of property or assets of the Purchaser, as the case may be), or Sellers in any action, suit or proceeding.

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12.4 Entire Agreement; Amendments and Waivers. This Agreement (including the schedules and exhibits hereto) represents the entire understanding and agreement between the parties hereto with respect to the subject matter hereof. This Agreement may be amended, supplemented or changed, and any provision hereof may be waived, only by written instrument making specific reference to this Agreement signed by the party against whom enforcement of any such amendment, supplement, modification or waiver is sought. No action taken pursuant to this Agreement, including without limitation, any investigation by or on behalf of any party shall be deemed to constitute a waiver by the party taking such action of compliance with any representation, warranty, covenant or agreement contained herein. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach. No failure on the part of any party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of such right, power or remedy by such party preclude any other or further exercise thereof or the exercise of any other right, power or remedy. All remedies hereunder are cumulative and are not exclusive of any other remedies provided by applicable Law.

12.5 Counterparts. For the convenience of the parties hereto, this Agreement may be executed (by facsimile or PDF signature) in any number of counterparts, each such counterpart being deemed to be an original instrument, and all such counterparts shall together constitute the same agreement.

12.6 Governing Law. THIS AGREEMENT IS TO BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH FEDERAL BANKRUPTCY LAW, TO THE EXTENT APPLICABLE, AND WHERE STATE LAW IS IMPLICATED, THE LAWS OF THE STATE OF FLORIDA SHALL GOVERN, WITHOUT GIVING EFFECT TO THE CHOICE OF LAW PRINCIPLES THEREOF, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.

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12.7 Jurisdiction, Waiver of Jury Trial.

(a) THE BANKRUPTCY COURT WILL HAVE JURISDICTION OVER ANY AND ALL DISPUTES BETWEEN OR AMONG THE PARTIES, WHETHER IN LAW OR EQUITY, ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY AGREEMENT CONTEMPLATED HEREBY; PROVIDED, HOWEVER, THAT IF THE BANKRUPTCY COURT IS UNWILLING OR UNABLE TO HEAR ANY SUCH DISPUTE, THE COURTS OF THE STATE OF FLORIDA AND THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA LOCATED IN THE SOUTHERN DISTRICT OF THE STATE OF FLORIDA WILL HAVE SOLE JURISDICTION OVER ANY AND ALL DISPUTES BETWEEN OR AMONG THE PARTIES, WHETHER IN LAW OR EQUITY, ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY AGREEMENT CONTEMPLATED HEREBY.

(b) EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

12.8 Notices. Unless otherwise set forth herein, any notice, request, instruction or other document to be given hereunder by any party to the other parties shall be in writing and shall be deemed duly given (i) upon delivery, when delivered personally, (ii) one (1) day after being sent by overnight courier or when sent by facsimile transmission (with a confirming copy sent by overnight courier), and (iii) three (3) days after being sent by registered or certified mail, postage prepaid, as follows:

If to Sellers, to

HearUSA, Inc.

Northpoint Parkway

West Palm Beach, FL 33407

Attn: Gino Chouinard, Interm CEO, President and COO

Facsimile No.: (561) 478-9603

With a copy (which shall not constitute effective notice) to:

Berger Singerman

350 East Las Olas Blvd., Suite 1000

Fort Lauderdale, FL 33301

Attn: Brian K. Gart, Esq.

and Robert W. Barron, Esq.

Facsimile No.: (954) 523-2872

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And to:

Bryan Cave LLP

1155 F Street, N.W.

Washington, D.C. 20004

Attn: LaDawn Naegle, Esq.

Facsimile No.: (202) 220-7346

If to the Purchaser OR to the Parent, to:

Siemens Hearing Instruments, Inc.

10 Constitution Avenue

Piscataway, NJ 08855

Attn: Chief Executive Officer

Facsimile No.: (732) 562-6682

With a copy (which shall not constitute effective notice) to:

Siemens Medical Solutions USA, Inc

51 Valleystream Parkway

Malvern, PA 19355

Attn: General Counsel

Facsimile No.: (610) 219-8333

And to:

Siemens Corporation

527 Madison Avenue, 8th Floor

New York, NY 10022

Attn: General Counsel

Facsimile No.: (212) 258-4490

And to:

Clifford Chance US LLP

31 West 52nd Street

New York, NY 10019

Attn: John A. Healy

Facsimile No.: (212) 878-8375

or to such other Persons or addresses as may be designated in writing by the party to receive such notice.

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12.9 Binding Effect; Assignment. This Agreement shall be binding upon the Purchaser and, subject to entry of the Sale Order, Sellers, and inure to the benefit of the parties and their respective successors and permitted assigns, including, without limitation, any trustee or estate representative appointed in the Chapter 11 Case or any successor Chapter 7 case. Nothing in this Agreement shall create or be deemed to create any third party beneficiary rights in any Person or entity not a party to this Agreement except as provided below. No assignment of this Agreement or of any rights or obligations hereunder may be made by Sellers or the Purchaser (by operation of law or otherwise) without the prior written consent of the other parties hereto and any attempted assignment without the required consents shall be void; provided, that the Purchaser may assign its rights and obligations hereunder in whole or in part to one or more wholly owned subsidiaries of the Purchaser (subject to the next succeeding sentence). No assignment of any obligations hereunder shall relieve the parties hereto of any such obligations. Upon any such permitted assignment, the references in this Agreement to the Purchaser shall also apply to any such assignee unless the context otherwise requires.

12.10 Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of Law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in a manner adverse to any party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the fullest extent possible.

12.11 Injunctive Relief. The parties agree that damages at Law may be an inadequate remedy for the breach of any of the covenants, promises and agreements contained in this Agreement by Sellers, and, accordingly, the Purchaser shall be entitled to injunctive relief with respect to any such breach, including without limitation, specific performance of such covenants, promises or agreements or an order enjoining Sellers from any threatened, or from the continuation of any actual, breach of the covenants, promises or agreements contained in this Agreement by Sellers. The rights set forth in this Section 12.11 shall be in addition to any other rights which the Purchaser may have at Law or in equity pursuant to this Agreement.

12.12 Non Recourse. No past, present or future director, officer, employee, advisor, lawyer, agent, representative, incorporator, member, partner or equityholder of Sellers or the Purchaser shall have any liability for any obligations or liabilities of Sellers or the Purchaser under this Agreement or Sellers’ Documents or the Purchaser’s Documents of or for any claim based on, in respect of, or by reason of, the transactions contemplated hereby and thereby.

12.13 Time of the Essence. Time is of the essence in the performance of each of the obligations of the parties and with respect to all covenants and conditions to be satisfied by the parties in this Agreement and all documents, acknowledgments and instruments delivered in connection herewith.

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12.14 Certain Interpretations.

(a) Unless otherwise expressly provided, for purposes of this Agreement, the following rules of interpretation shall apply:

(b) All references in this Agreement to Articles, Sections, Schedules and Exhibits shall be deemed to refer to Articles, Sections, Schedules and Exhibits to this Agreement.

(c) All Exhibits and Schedules annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein. Any capitalized terms used in any Schedule or Exhibit but not otherwise defined therein shall be defined as set forth in this Agreement.

(d) The Article, Section and paragraph captions herein are for convenience of reference only, do not constitute part of this Agreement and shall not be deemed to limit or otherwise affect any of the provisions hereof.

(e) The words “include,” “includes” and “including,” when used herein shall be deemed in each case to be followed by the words “without limitation” (regardless of whether such words or similar words actually appear).

(f) When calculating the period of time before which, within which or following which any act is to be done or step taken pursuant to this Agreement, the date that is the reference date in calculating such period shall be excluded.

(g) Any reference in this Agreement to $ shall mean U.S. dollars.

(h) Any reference in this Agreement to gender shall include all genders, and words imparting the singular only shall include the plural and vice versa.

(i) The words such as “herein,” “hereinafter,” “hereof,” and “hereunder” refer to this Agreement as a whole and not merely to a subdivision in which such words appear unless the context otherwise requires.

(j) The parties hereto agree that they have been represented by legal counsel during the negotiation and execution of this Agreement and, therefore, waive the application of any Law, regulation, holding or rule of construction providing that ambiguities in an agreement or other document shall be construed against the party drafting such agreement or document.

(k) The Purchaser acknowledges hereby that Sellers may not comply with the provisions of any bulk transfer laws of any jurisdiction in connection with the transactions contemplated by this Agreement.

(l) This Agreement may be executed in counterpart signature pages, all of which when so executed and attached hereto shall constitute one and the same original.

Signatures on Next Page

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

	PURCHASER:

	AUDIOLOGY DISTRIBUTION, LLC

	By:	/s/ Brian S. Davis
	Name:
	Title:

	By:	/s/ Kenneth R. Meyers
	Name:
	Title:

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	PARENT:

	SIEMENS HEARING INSTRUMENTS, INC., for the purposes of being legally bound to the terms and provisions of Section 12.3 of this Agreement

	By:	/s/ Brian S. Davis
		Name:
		Title:

	By:	/s/ Kenneth R. Meyers
		Name:
		Title:

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	SELLERS:

	HEARUSA, INC.,
	a Delaware corporation

	By:	/s/ Gino Chouinard
		Name: Gino Chouinard
		Title: Interim CEO, President and COO

	AUXILIARY HEATH CORPORATION,
	a corporation

	By:	/s/ Gino Chouinard
		Name: Gino Chouinard
		Title: Authorized Officer

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