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/b:J F. Future Management of the Debtor 1. Ownership Structure of the Debtor Healthcare Brown Management Co, owns 100% of the shares of sto~~ in Debtor issued and outstanding. Healthcare Brown Management Co. is directly and indirectly owned by Hea1thcare. On May 20, 1993, Ju¿ge ~elly approved the disclosure statement for HealthVest's First Amended Pla~ of Reorganization for Healthcare, Healthcare Brown Management Co. and The Brown Schools, Inc. (the "Parent Pla~") and authorized HealthVest to solicit acceptances of the Parent Plan. The ballots on the Parent Plan were due on July 20, 1993, and all voting classes accepted the Plan. The Parent Plan contemplates the continued operation of the Debtor as well as Laurel Ridge Hospital, Healthcare Rehabilitation Center, San Marcos Treatment Center, Cumberland Hospital, The Oaks Treatment Center and Community Living Centers. The reorganization of Healthcare, Healthcare Brown Management and the Debtor are interrelated and a failure ,to confirm the Parent Plan will negatively affect the Debtor I s ability to reorganize. 2. Officers and Directors of the Reorganized Debtor The Debtor's Plan of Reorganization does not contemplate any material changes in management, the officers or employees of the Debtor corporation. - The following is a list of directors and principal officers who have management responsibility in connection with the operation of the Debtor: Director: Gregg J. Powers i President/ Chief Executive Officer: Anton C. Merka Vice President/ Secretary/Treasurer: J. Mack Nunn [Information on the Directors of Reorganized San Marcos will be provided at the hearing on approval of this Disclosure Statement.] The administrator of Debtor's hospital operations is Mart Hoffman and its controller is Kim Watson. V. RELATIONSHIP OF DEBTOR WITH AFFILIATES Healthcare operates on behalf of itself and its Subsidiaries a sophisticated cash management and reporting system (the "System") from its corporate offices in Austin, Texas. Healthcare uses this system to maintain corporate (both parent and subsidiary) revenue records, meet payroll and pay taxes for itself and the Subsidiaries, comply with the federal and state procedures for reimbursement, maintain professional and general liability insurance, workman's compensation insurance, and property insurance. The - 9 - a-20155