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JOINT OPERATING AGREEMENT

THIS JOINT OPERATING AGREEMENT ("Agreement") is made and entered into as of

the effective date set out in Article 4 (the "Effective Date"), by and between MCG Health

System, Inc. ("MCGHS"), a nonprofit corporation established under the laws of the State of

Georgia, MCG Health, Inc. ("MCGHI"), a nonprofit corporation established under the laws of

the State of Georgia, and The Medical College of Georgia Physicians Practice Group

Foundation ("PPG"), a cooperative organization under the policies of the Board of Regents of

the University System of Georgia ("Board of Regents" or "Regents"), the public body of the

State of Georgia (the "State") that is vested with the governance, control, and management of the

University System of Georgia pursuant to Article VIII, Section IV, Paragraph I(b) of the

Constitution of the State of Georgia. Certain capitalized terms used herein and not otherwise

defined shall have the meanings set forth in Article 5.

WHEREAS, MCGHI has assumed responsibility for clinical service delivery of the

MCG Hospital and Clinics pursuant to the Master Affiliation Agreement and Associated

Agreements;

WHEREAS, PPG is a voluntary association of Faculty physicians and oral surgeons,

organized pursuant to the provisions of Georgia law as an association, and qualified as an

organization exempt from taxation under Section 501(c)(3) of the Internal Revenue Code, and

operated to promote the multi-specialty group practice of medicine and to support The Medical

College of Georgia ("MCG");

WHEREAS, a relationship between MCGHS, MCGHI and PPG that facilitates mutually

beneficial planning and development will enhance the efficient and economic operations of

MCGHI and PPG and support the education, training, and research missions of MCG;

WHEREAS, MCGHI and PPG have agreed to enter into a joint operating arrangement to

combine their responsibility and authority for strategic planning, direction and coordination,

including the coordination of their clinical activities with the educational activities of MCG and

its constituent colleges, schools, departments and research units, in order (i) to achieve more

efficient and economic operations for MCGHI and PPG; (ii) to promote the delivery of high

ATL IMANAGE-6922962.8

updates or amendments to or deviations from the strategic plans will be brought to MCGHS and

acted upon by MCGHS.

SECTION 1.2 FINANCIAL OPERATIONS

MCGHI and PPG will each develop annual operating and capital budgets with the

guidance of MCGHS. All such budgets developed by MCGHI and PPG must be approved by the

Chairman/Chief Executive Officer of MCGHS and submitted for review and final approval by

the MCGHS Board. Matters requiring the Board of Regents approval must also be submitted to

the Board of Regents for such approval. After the adoption and approval of annual operating and

capital budgets, MCGHI and PPG will conduct their day-to-day operations in a manner that is

consistent with such budgets. Consistent with the fiscal cycles of MCGHI and PPG, MCGHS

will establish the time frames for the annual development of budgets. MCGHI and PPG will

bring to MCGHS for its approval any material updates or amendments to or deviations from the

approved budgets.

MCGHI and PPG shall submit to MCGHS regular reports on their financial operations on

a schedule to be determined by MCGHS.

SECTION 1.3 SHARED SERVICES

MCGHS will have the authority to coordinate the procurement of certain services that

MCGHI and PPG will share with each other or with the operating units of MCG. Consistent

with any applicable accounting or regulatory requirements, MCGHS will determine the

allocation of expenses of such shared services, and MCGHI and PPG will be responsible for

payment for their respective shares of such expenses.

SECTION 1.4 INTER-ORGANIZATIONAL CONTRACTS

1. MCGHS will provide direction to MCGHI and PPG respecting any and all changes in the

existing inter-organizational agreements among the parties, including but not limited to

the Master Affiliation Agreement and the Associated Agreements, as may be necessary or

appropriate to implement the terms and conditions set forth herein. In the event the

negotiate in good faith to determine the amount and payment terms of such expense

reimbursement.

ARTICLE 4. EFFECTIVE DATE, DURATION OF AGREEMENT, AND

TERMINATION

SECTION 4.1 EFFECTIVE DATE OF AGREEMENT/TERM OF AGREEMENT

1. This Agreement shall become effective July 1, 2010 (the "Effective Date"), and, unless

sooner terminated in accordance with this Agreement, shall continue for the term of the

Master Lease, including any extensions of the term of the Master Lease.

2. Nothing contained in this Section shall operate to extend the term of the Master

Affiliation Agreement or any of the Associated Agreements beyond the term mutually

agreed upon by the parties and set forth in the Master Affiliation Agreement or in each of

the respective Associated Agreements.

SECTION 4.2 ENTIRE AGREEMENT

This Agreement shall constitute the entire understanding between the parties hereto

regarding the subject matter of this Agreement. Any prior agreements, promises, negotiations,

either oral or written, relating to the subject matter of this Agreement not expressly set forth in

this Agreement are of no force or effect.

SECTION 4.3 EVENTS OF DEFAULT

The following shall constitute events of default:

1. If any party hereto has failed in any material respect to fulfill or perform any duty,

obligation, or responsibility undertaken by it under the terms of this Agreement, the

Master Affiliation Agreement or any Associated Agreement, and if such failure continues

for a period of thirty (30) days after written notice of such failure, specifying in detail the

nature thereof, has been provided to the defaulting party by any other party hereto or by

Regents or its designee;

thereunder, provided that the parties shall be required to make a good faith

attempt for a period of thirty (30) days following said modification or change to

negotiate with one another to modify or amend the agreement at issue with an

amended or replacement agreement which complies with all Governmental

Regulations.

d. If Regents elects to terminate this Agreement under this Section, it shall give to

MCGHS, MCGHI and PPG written notice, and this Agreement shall terminate

upon a date specified in such notice (the "Regents Termination Date"); provided,

however, upon receiving such written notice from Regents and prior to the

Regents Termination Date, any party to this Agreement may cause a good faith

renegotiation of its terms. If the parties fail to renegotiate the terms of this

Agreement prior to the Regents Termination Date, or such other date as shall be

agreed to by Regents, MCGHS, MCGHI and PPG, this Agreement shall

automatically terminate.

SECTION 4.5 EFFECT OF TERMINATION

In the event of termination of this Agreement pursuant to this Article, then this

Agreement shall be of no further force or effect; except that any provisions of this Agreement

which must survive in order to give effect to their terms shall survive any expiration or

termination of this Agreement. Nothing contained in this Article shall operate as an assumption

by Regents or MCG of any liabilities or obligations of any type of MCGHS, MCGHI or PPG

upon termination or expiration of this Agreement or otherwise.

ARTICLES. DEFINITIONS

The following terms shall have the following meaning in this Agreement unless the

context clearly requires otherwise:

"Amended Master Affiliation Agreement" or "Master Affiliation Agreement" means

the Amended Master Affiliation Agreement effective July 1, 2000, including any amendments or

supplements thereto or renewals thereof.

and Clinics, (ii) relating to any service delivered or provided under any of the Associated

Agreements, or (iii) to which the MCG Hospital and Clinics, and the parties hereto, are otherwise

subject.

"Master Lease" means the Master Lease Agreement between Regents and MCGHI,

effective as of July 1, 2000, including any amendments and supplements thereto and renewals

thereof.

"MCG" shall mean the Medical College of Georgia.

"MCGHI" shall have the meaning set forth on the first page of this Agreement.

"MCGHI Board" shall mean the board of directors of MCGHI.

"MCG Hospital and Clinics" means the Medical College of Georgia Hospital and

Clinics a/k/a the Eugene Talmadge Memorial Hospital and Clinics, and including, without

limitation, the MCG Hospital and Clinics located at 1120 15th Street, Augusta, Georgia

("H&C"), the Children's Medical Center located at 1446 Harper Street, Augusta, Georgia

("CMC"), and the Georgia Radiation Therapy Center at Augusta located at 821 St. Sebastian

Way, Augusta, Georgia ("GRTC"), and the other clinical facilities of MCG operated by MCGHI,

wherever located.

"MCGHS" shall have the meaning set forth on the first page of this Agreement.

"MCGHS Board" shall mean the board of directors of MCGHS.

"Operations and Services Agreement" or "OSA" means the Operations and Services

Agreement, effective as of July 1, 2000, including any amendments and supplements thereto and

renewals thereof.

"Person" shall mean any individual, corporation (including any nonprofit corporation),

general or limited partnership, limited liability company, joint venture, estate, trust, association,

organization, labor union, or other entity or Governmental Body.

All article, section, subsection, and other headings in this Agreement are included solely

as a matter of convenience and for reference, and shall not be considered a part of, nor shall they

affect in any manner the construction or interpretation of, this Agreement.

SECTION 6.4 ASSIGNMENT

This Agreement may not be assigned in whole or in part by MCGHS, MCGHI or PPG

without the prior express written consent of Regents.

SECTION 6.5 INDEPENDENT CONTRACTORS

The relationship between the parties under this Agreement, once consummated, will be

that of independent contractors, and nothing contained herein shall be construed to establish a

partnership, joint venture, or other relationship between the parties other than that of independent

contractors.

SECTION 6.6 GOVERNING LAW AND DISPUTE RESOLUTION

This Agreement is made, entered into under and shall be construed in accordance with the

laws of the State of Georgia. The parties hereby agree that in the event of a dispute with respect

to the provisions of this Agreement, the sole remedy of the parties shall be for the President of

MCGHI, the President of PPG and the Chairman/Chief Executive Officer of MCGHS to

negotiate in good faith to try and resolve the dispute in accordance with the purposes and intents

of this Agreement. If after a period of thirty (30) days of good faith negotiations beginning on

the date of written notice of a dispute by one party to the other parties such dispute remains

unresolved, then the parties shall submit the dispute in writing to the Board of Regents who shall

consider such dispute and make a timely decision with respect thereto. The full and complete

utilization and exhaustion of this dispute resolution process shall be an absolute prerequisite to

the commencement of a proceeding to seek judicial review of the decision of the Board of

Regents.

Nothing in this Agreement should be construed in any manner that is contrary to any

applicable Governmental Regulation. This Agreement, the Master Affiliation Agreement and

any Associated Agreements are, at all times, intended to comply with, are subject to, and should

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MCGHS: Attn: Chairman/Chief Executive OfficerMCG Health System, Inc.Medical College of Georgia1120 15th Street, BA-3306Augusta, Georgia 30912Phone:(706)721-2301Facsimile: (706) 721-2303

MCGHI: Attn: Chief Executive OfficerMCG Health, Inc.1120 15th Street, BI-2090Augusta, Georgia 30912Phone:(706)721-6569Facsimile: (706) 721-6572

PPG: Attn: PresidentThe Medical College of Georgia Physician Practice GroupFoundation1499 Walton Way, Suite 1400Augusta, Georgia 30901Phone: (706) 828-6410Facsimile: (706) 722-5187

Regents, MCGHS, MCGHI and PPG may, by notice as herein provided, designate any

further or different addresses to which subsequent notices, certificates or other communications

shall be sent.

SECTION 6.8 MODIFICATION AND AMENDMENT

This Agreement may be modified or amended only by a written instrument executed by

MCGHS, MCGHI and PPG, and acknowledged and approved by the Regents.

SECTION 6.9 EFFECT OF OUTSIDE FORCES/FORCE MAJEURE

In the event MCGHS, MCGHI or PPG is unable, wholly or in part, due to a force

majeure, to carry out any undertaking or obligation under this Agreement, it is agreed that the

obligations of MCGHS, MCGHI, PPG or any or all of the parties, so far as they are affected by

such force majeure, shall be suspended so long as the performance of any such undertaking or

obligation is prevented or delayed, retarded or hindered by any force majeure but for no longer.

Such suspension or delay shall be remedied with all reasonable dispatch. The term "force

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SECTION 6.12 MODIFICATION DUE TO LEGISLATIVE, ADMINISTRATIVE, OR OTHER

CHANGES

1. The parties recognize that this Agreement is at all times intended to comply with, and be

subject to, applicable Governmental Regulations. The parties further recognize that this

Agreement shall be subject to new or amended Governmental Regulations.

2. If, after the Effective Date, any Governmental Body should adopt, modify, or alter any

Governmental Regulations so as to place additional obligations upon any party hereto,

then the parties shall in good faith renegotiate the amendment or replacement of any

affected provisions in this Agreement or any Associated Agreement.

3. If, after the Effective Date, any Governmental Body should adopt, modify, or alter any

Governmental Regulations that substantially change or modify the ability of MCGHS,

MCGHI or PPG to perform its obligations or duties under this Agreement, then the

parties shall in good faith renegotiate the amendment or replacement of any affected

provisions in this Agreement or any Associated Agreement.

4. Nothing contained herein shall abridge, modify, or otherwise alter the rights of Regents to

terminate this Agreement under Article 4.

SECTION 6.13 EXPENSES

All expenses incurred by the parties hereto in connection with or related to the

negotiation, authorization, preparation, documentation and execution of this Agreement and the

consummation of the transactions contemplated by this Agreement, including without limiting of

the generality of the foregoing, all fees and expenses of agents, representatives, counsel, and

accountants employed by any such party, shall be borne solely and entirely by the party which

has incurred the same.

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APPROVAL AND ACKNOWLEDGEMENT:

The Board of Regents of the University System of Georgia (the "Regents") approves the

execution of the foregoing Joint Operating Agreement by and among MCG Health System, Inc.,

MCG Health, Inc. and The Medical College of Georgia Physicians Practice Group Foundation

and acknowledges the terms and conditions hereof, including the termination rights of the

Regents as set forth in Section 4.4 thereof and the rights of the Regents to resolve disputes as set

forth in Section 6.6 hereof.

BOARD OF REGENTS OF

THE UNIVERSITY SYSTEM OF GEORGIA

[Seal] By:

Title:

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Proposed Aligned MCG Structure

GovernorI

USG Board of RegentsGov. nominates 3 members and I

USG BOR appoints 4 others I~1 — • "I

1USG Chancellor

MCG Health System, Inc. (MCGHS) Board(MCG President is Board Chair & CEO)

MCG PresidentJoint Operating Agreement

MCGHI Board(MCG President is

Board Chair)

PPG Board(MCG SOM Dean is

Board Chair)

MCGHI(President & CEO)

PPG(President & CEO)

SVP Health Affairs &Dean SOM

SVP AcademicAffairs & Provost

Othernon-SOM MCG

Schools' PracticePlans

MCG SchoolsEducationalEnterprise

MCG SOMPractice Plan

(PPG)

Hospital &Clinics