I. Introduction Welfare Specialty Hospital (WSH), a state-owned healthcare facility, was an accredited, 200-bed specialty hospital. The fifty-year-old complex was not designed as a specialty hospital and was outdated with respect to current medical practices. It was very inefficient and not conducive to proper patient care. On an average day, forty percent of the available beds were unoccupied. The decrepit complex also required a significant amount of maintenance and was not energy efficient. Given the declining government support for healthcare and the inefficiencies of the current facility, the hospital's administrators wanted to buy a new, smaller, more efficient state-of-the-art complex from Jacob Hospitals Corporation. The administrators believed that the savings from reduced payroll, maintenance, utilities, and insurance costs would cover the acquisition costs of the new complex. II. Current Hospital Welfare Specialty Hospital had approximately 606 full-time and part-time employees. It operated out of a 30-building complex with approximately 400,000 square feet of building space on approximately 150 acres of land. Only 100 acres of the land were cleared with 3 miles of paved roads. The rest of the acreage contained some of the best timber in the area. The hospital was located in an isolated area and operated two deep- water wells and a sewage treatment plant. WSH utilized modern medical devices and computer systems. The multiple free-standing buildings were a great distance from each other and were built fifty years ago. There was lead paint throughout the facility and pending asbestos and mold related issues. The hospital had already received approval from the state for millions of dollars of upgrades to the facility, with requests for substantial additional upgrades still awaiting state approval. Several of the buildings were not even in service. The buildings, with very wide hallways and large amounts of unused space, housed small offices and very small patient rooms. The nurses' stations were located far from the patients' rooms, making it difficult to tend to patients needed in a timely manner. The buildings were not energy efficient, with the annual budget for utilities exceeding $1 million. The hospital incurred high insurance costs due to the poor design of the facility and outdated safety equipment. Salaries and related benefits constituted the largest expense for the hospital