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Exhibit 1:

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UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK . Chapter 11 IN RE: . . Case No. 05-14945 (CGM) SAINT VINCENT'S CATHOLIC MEDICAL . CENTERS OF NEW YORK, d/b/a . (Jointly Administered) SAINT VINCENT CATHOLIC . MEDICAL CENTERS, et al, . New York, New York . Thursday, July 1, 2010 . 11:01 a.m. Debtors. . .. . . . . . . . . . . . . . . . . TRANSCRIPT OF MOTION TO STAY NOTICE OF MOTION FOR ENTRY OF AN ORDER MODIFYING THE AUTOMATIC STAY TO PERMIT CONSUMMATION OF PENDING STATE COURT SETTLEMENT FILED BY LESLIE ANN BERKOFF ON BEHALF OF PATRICIA MARSH, WITH HEARING TO BE HELD ON 7/1/2010 AT 11:00 A.M. AT OFFICE OF UST (355 MAIN STREET, POUGHKEEPSIE) RESPONSES DUE BY 6/25/2010, (ATTACHMENTS #(1) EXHIBIT a, #(2) EXHIBIT B, #(3) EXHIBIT C); SO ORDERED STIPULATION RE: EUN SOOK AND SOO MAING SIGNED ON 6/11/2010 WITH HEARING TO BE HELD ON 7/1/2010 AT 11:00 A.M. AT COURTROOM 701 (PCB); MOTION FOR RELIEF FROM STAY FILED BY CHRISTOPHER S. FANNING ON BEHALF OF GLENNFORD IRVING WITH HEARING TO BE HELD ON 5/27/2010 (CHECK WITH COURT FOR LOCATION)(ATTACHMENTS #(1) NOTICE OF APPEARANCE, #(2) CERTIFICATE OF SERVICE); NOTICE OF HEARING/HEARING AGENDA OF MATTERS SCHEDULED ON JULY 1, 2010 FILED BY ADAM C. ROGOFF ON BEHALF OF SAINT VINCENT'S CATHOLIC MEDICAL CENTERS OF NEW YORK WITH HEARING TO BE HELD ON 7/1/2010 (CHECK WITH COURT FOR LOCATION); (CONTINUED) BEFORE THE HONORABLE CECELIA G. MORRIS UNITED STATES BANKRUPTCY JUDGE

Audio Operator: 20 21 22 23 24 25 Transcription Company:

Electronically Recorded By ECRO Rand Reporting & Transcription, LLC 80 Broad Street, Fifth Floor New York, New York 10004 (212) 504-2919 www.randreporting.com

Proceedings recorded by electronic sound recording, transcript produced by transcription service.

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Doc 177-1 Filed 07/05/12 Entered 07/05/12 16:35:46 Judge Morris Bench Decision Pg 2 of 12 Court Decision Very good. MR. BOTTER:

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I'm ready to make a -- yes, sir? No, Your Honor, I was just going to add

before, and I didn't want to repeat what everybody says, but this sale truly was a joint effort by all constituents to move forward to get a high price and both the Debtors and Ms. Hershcopf and her firm really ought to be commended; they did a fantastic job. And I'm hopeful that we will be able to proceed

in this matter with respect to all situations to maximize value. THE COURT: I am too. I mean, I like it. I'm going

to ask for you and Mr. Rogoff and the US Trustee to join me in chambers after I read my opinion. And this is my opinion on

the decision of evergreen retainers for the Debtors' counsel and restructuring firm. The US Trustee objects to Kramer Levin's evergreen retainer of 750,000. The US Trustee alleges that Kramer Levin

will hold this money as security throughout this case and take regular payments using the 3 million carveout from the DIP financing for professional fees that must be shared by all professionals. The US Trustee objects to Grant Thornton's evergreen retainer similar to that of Kramer Levin's. The US Trustee points out that Kramer Levin and Grant Thornton will receive eighty percent of their fees on a monthly basis pursuant to the monthly compensation order that was

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entered. The US Trustee's argument seems to be that Kramer Levin and Grant Thornton are unfairly positioning themselves to get paid more than the other professionals, percentage more than the other professionals. The US Trustee is concerned about the case being administratively insolvent. If these professionals can get

paid with non-retainer money, they will have the retainer to fall back on in the event of administrative insolvency, which is not fair to the other professionals. Counsel to Debtors respond that the retainer is appropriate because counsel has already agreed to a ten-percent fee reduction and Grant Thornton waived its success fees. will tell you the Court gives no credence to those two arguments. They both agree to cap budget for professional fees and they will credit their retainers before seeking recovery from the carve-out provided in the DIP. credence to that argument. Counsel argues that the law does not require professionals to apply the retainer at the onset of the case. The US Trustee's law to the contrary is in opposite and I think probably misapplied. Counsel states -- statement alleges that the retainer they have drawn down to 550,000 each for prepetition services. The Court does give I

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Counsel alleges that the evergreen retainers are commonly approved in cases in this district such as CIT Group, Cabrini Medical Center, and Our Lady of Mercy Medical Center. Again, I look at the Cabrini and the Our Lady of Mercy more than the ones that might have assets that might be going to the unsecureds. At a hearing held on May 27th, counsel to the Debtor argued the following points in support of the evergreen retainer: It is commonplace for retainers to be held like a security deposit until the end of the case. Whenever a company has too much secured debt, there is, by definition, a risk of administratively insolvent. The Debtor is operating pursuant to a budget set forth in the DIP and if there is more cost to his case than is budgeted, there's no assurance that the fees are going to be paid. Kramer Levin will discount its fees by ten percent. Operating within the budget for professionals means that the DIP lender will not be obligated to fund unlimited administrative expenses. And I quote, "We may ultimately incur more fees than we" -- "than what are in the budget, and in this case we will either get paid out of the unencumbered assets or we will look to the retainers and the carve-out to cover essentially the

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amount in excess of the budget.

The retainer will be used" --

and this is important -- "the retainer will be used up before the professionals look to the carve-out for payment, pro rata with the other professionals." And that was a concession that was made here in court. The DIP, in other aspects of the retention, would have been negotiated differently if Kramer Levin had known it might not have been able to the evergreen retainer. At the May 27th hearing, counsel to the US Trustee made the following arguments: The retainers were five hundred and fifty each for Kramer Levin and Grant Thornton, in addition to the 3 million carve-out in the DIP and the order providing for monthly compensation of the professionals up to eighty percent of their fees each month; The secured creditors have extraordinary leverage over every constituency in this case; Administrating a case for the benefit of the secured creditors and the professionals is not a proper Chapter 11 purpose; Only the Debtors may convert their cases, being nonprofit corporations; The normal practice is for retainers to be drawn down before approval of the first interim fees; None of the cases cited by the Debtor in support of

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its retainer involve nonprofit Chapter 22 liquidations, which no one could move to convert; The Debtors have not met their burden of reasonableness pursuant to Insilco that they discussed, and I quote here, "The US Trustee believes that all professionals should be treated equally and should labor under the same pressure and share in the same pool of funds pari passu as set forth in the code." Counsel to the Committee noted on the record that if Debtors' counsel's creditor is retained before looking to the carve-out for payment -- carve-out for payment, then other professionals themselves would get more money from the carveout. Legal standards, In re: Kudson Corporation (phonetic)

(9th Cir. 1998), a liquidating Chapter 11 case funded by the principal secured creditor, the appellate court approved a billing procedure similar to one at the case at bar where counsel and accountants to the Debtor and counsel to the Committee were paid monthly, with the court formally approving the fees every three months. Kudson does not appear to address directly the propriety of an evergreen retainer. of fees before the fees are approved. Kudson provides a list of findings for the Court to make in determining whether it is permissible to allow The case addresses payment

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prepayment of fees which may yet be recovered if unreasonable pursuant to 330. The case is an unusually large one in which The

exceptionally large amount of fees accrue each month.

Court is convinced that waiting for an extended period of payment would place an undue hardship on counsel. The Court is

satisfied that counsel can respond to any assessment in one way or more of the ways listed above, and the retainer -- fee retainer procedure is itself the subject of notice and hearing prior to any payment. The Kudson factors generally are persuasive in helping a bankruptcy court determine whether a professional's fee arrangement overreaches with respect to risk management to the detriment of creditors in the estate. In In re: Insilco Tech., a Delaware case 2003, the

court approved an evergreen retainer to which he gave the following definitions: The evergreen retainer is similar to a security retainer in that it is to secure payments of fees for future services, but in the case of an evergreen retainer, the fees are not intended to be used to pay approved fees until approval of the final fee application. Instead, the holder of the evergreen retainer intends to be paid its interim fees and expenses out of operating cash. Such a position is designed to minimize a professional's risk of non-payment if a debtor's financial position deteriorates,

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an estate becomes illiquid, and does not have sufficient cash flow to pay professionals. In Insilco the court considered the following nonexhaustive list of factors in finding that a retainer agreement was acceptable: Whether the terms of an engagement agreement reflect normal business terms in the marketplace; The relationship between the debtor and the professionals where the parties involved are sophisticated business entities with equal bargaining power who engage in arm lengths negotiation; Whether the retention as proposed is in the best interest of the estate; Whether there is creditor opposition to the retention and retainer provision; And whether given the size, circumstances, and posture of the case, the amount of the retainer is itself reasonable, including whether the retainer provides for the appropriate level of risk minimization, especially in light of the existing of other risk minimizing devices such as an administrative order or a carve-out. The Insilco court noted arguments by the US Trustee that are similar to those presented in the case at bar. The

professionals should not be treated differently than other administrative creditors. The cash collateral order provided

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for a 1.8-million carve-out for professionals and interim compensation and reimbursement orders had been entered. In the matter at bar, Kramer Levin alleges that it, Debtor, and Grant Thornton are sophisticated parties who engage in arms length negotiations and alleges that they relied on their retainers while negotiating the DIP. Kramer Levin points

out that the Committee and the secured creditors do not oppose this payment agreement. Like in Insilco, the liabilities far exceed the assets. The court in Insilco considered the fact as support by

the award of evergreen retainer because the debtors' funding depended on its counsel and the Committee to negotiate with the secured creditors. First, Kramer Levin inserts -- asserts that the use of evergreen retainers is a common practice in this district. This is a unique case in this district. Unlike in Insilco, the

US Trustee disputes that the taking of evergreen retainers is a common practice. Kramer Levin cite several cases in which Insilco, Benjamins,

counsel employed the use of evergreen:

Arnolds Inc., a Minnesota case; PanAm Hospitals, a southern Florida case; and six cases filed since 2007 in the bankruptcy court for the Southern District of New York. The Court is satisfied that evergreen retainers are generally accepted in this district. It doesn't change my

ruling, but I do admit there was pause because of this case.

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It is undisputed that the parties are sophisticated and dealt at arms length. Kramer Levin argues that the

retainer agreement was considered in the DIP, which was heavily negotiated. Kramer Levin notes on the record that the secured lender has much influence in this case. The retainer agreement appears to be in the best interest of the creditors. Counsel to the Committee noted on the record of the hearing of May 27th that if Kramer Levin and Grant Thornton are allowed evergreen retainers, they may use up before they look at the carve-out for payments. The effect of this procedure

would be to make more money available to other professionals from the carve-out and there is no creditor opposition. The retainer agreement is reasonable, given the size and posture of the case. As the Debtors' noted on the record

at the hearing of May 27th, Kramer Levin will have to coordinate sales of ten separate healthcare businesses which are subject to complicated government regulations. In past motions to sell, Debtors have repeatedly emphasized their ongoing duty to provide patient care. Liquidating these Debtors must be seamless and fast so as not to disrupt patient care. Further other mechanisms restrict Kramer Levin's fee. The order establishing procedures for interim compensation and

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reimbursement of expenses of professionals dated May 18th provide that eighty percent of undisputed fees will be paid for a thirty-five-day period and all remaining subject to final approval pursuant to Section 330. And Kramer Levin has agreed to a ten-percent reduction of all overall fees. It appears that the Debtors will be paid out of the operating budget that is supplied by the DIP, then the retainer, then the carve-out. It is consistent with Insilco to allow the retainer according to these terms. The Court allows the evergreen Counsel to the

retainer for Kramer Levin and Grant Thornton. Debtors shall submit an order.

And I would like to see secured debtor and unsecured debtor and US Trustee. (Proceedings concluded at 12:02 p.m.) *****

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Doc 177-1 Filed 07/05/12 Entered 07/05/12 16:35:46 Judge Morris Bench Decision Pg 12 of 12 CERTIFICATION

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I certify that the foregoing is a correct transcript from the electronic sound recording of the proceedings in the above-entitled matter to the best of my knowledge and ability.

______________________________ Lisa Luciano, CET**D-327 Certified Court Transcriptionist For Rand Reporting & Transcription, LLC

July 2, 2010