Supplemental Guarantor and Non-Guarantor Financial Information

Gentiva’s guarantor subsidiaries are guarantors to the Company’s debt securities which are registered under the Securities Act of 1933, as amended. The condensed consolidating financial statements presented below are provided pursuant to Rule 3-10 of Regulation S-X. Separate financial statements of each subsidiary guaranteeing Gentiva’s debt securities are not presented because the guarantor subsidiaries are jointly and severally, fully and unconditionally liable under the guarantees, subject to certain customary release provisions and 100 percent owned by the Company. There are no restrictions on the ability to obtain funds from these subsidiaries by dividends or other means.

The following condensed consolidating financial statements include the balance sheets as of December 31, 2013 and December 31, 2012, statements of comprehensive income for the years ended December 31, 2013, December 31, 2012 and December 31, 2011 and statements of cash flows for the years ended December 31, 2013, December 31, 2012 and December 31, 2011 of (i) Gentiva Health Services, Inc., (ii) its guarantor subsidiaries, and (iii) its non-guarantor subsidiaries, (in each case, reflecting investments in its consolidated subsidiaries under the equity method of accounting) along with eliminations necessary to arrive at the information for the Company on a consolidated basis. Reclassifications have been made to the 2012 Condensed Consolidating Balance Sheet to conform to the current year presentation which reflects the Company's debt issuance costs and the unamortized discount on the Company's term loans under Gentiva Health Services, Inc., with the accompanying debt, and not as assets and liabilities of the guarantor subsidiaries. The condensed consolidating financial statements should be read in conjunction with the accompanying consolidated financial statements.

Condensed Consolidating Balance Sheet

December 31, 2013

(In thousands)



	Gentiva Health Services, Inc.			Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated Total
ASSETS
Current assets:
Cash and cash equivalents	$	55,076		$	—	$	31,881	$	—		$	86,957
Receivables, net	—			284,379		34,136		(28,610		)	289,905
Deferred tax assets, net	—			25,845		2,308		—			28,153
Prepaid expenses and other current assets	—			50,890		13,856		—			64,746
Total current assets	55,076			361,114		82,181		(28,610		)	469,761
Notes receivable from CareCentrix	—			28,471		—		—			28,471
Fixed assets, net	—			48,824		551		—			49,375
Intangible assets, net	—			253,682		2,600		—			256,282
Goodwill	—			384,017		6,064		—			390,081
Investment in subsidiaries	790,589			28,382		—		(818,971		)	—
Other assets	28,266			40,370		11		—			68,647
Total assets	$	873,931		$	1,144,860	$	91,407	$	(847,581	)	$	1,262,617
LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt	$	45,325		$	—	$	—	$	—		$	45,325
Accounts payable	—			15,377		282		—			15,659
Other current liabilities	—			283,228		59,868		(28,610		)	314,486
Total current liabilities	45,325			298,605		60,150		(28,610		)	375,470
Long-term debt	1,124,432			—		—		—			1,124,432
Deferred tax liabilities, net	—			9,825		—		—			9,825
Other liabilities	7,243			45,841		—		—			53,084
Total Gentiva shareholders’ equity	(303,069		)	790,589		28,382		(818,971		)	(303,069		)
Noncontrolling interests	—			—		2,875		—			2,875
Total equity	(303,069		)	790,589		31,257		(818,971		)	(300,194		)
Total liabilities and equity	$	873,931		$	1,144,860	$	91,407	$	(847,581	)	$	1,262,617

Condensed Consolidating Balance Sheet

December 31, 2012

(In thousands)



	Gentiva Health Services, Inc.		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminations			Consolidated Total
ASSETS
Current assets:
Cash and cash equivalents	$	166,140	$	—	$	40,912	$	—		$	207,052
Receivables, net	—		245,191		19,744		(13,855		)	251,080
Deferred tax assets, net	—		10,280		1,983		—			12,263
Prepaid expenses and other current assets	—		36,899		8,733		—			45,632
Total current assets	166,140		292,370		71,372		(13,855		)	516,027
Note receivable from CareCentrix	—		28,471		—		—			28,471
Fixed assets, net	—		41,066		348		—			41,414
Intangible assets, net	—		193,513		100		—			193,613
Goodwill	—		650,300		6,064		—			656,364
Investment in subsidiaries	1,002,204		27,210		—		(1,029,414		)	—
Other assets	44,219		30,820		6		—			75,045
Total assets	$	1,212,563	$	1,263,750	$	77,890	$	(1,043,269	)	$	1,510,934
LIABILITIES AND EQUITY
Current liabilities:
Current portion of long-term debt	$	25,000	$	—	$	—	$	—		$	25,000
Accounts payable	—		27,300		—		(13,855		)	13,445
Other current liabilities	—		202,321		49,133		—			251,454
Total current liabilities	25,000		229,621		49,133		(13,855		)	289,899
Long-term debt	910,182		—		—		—			910,182
Deferred tax liabilities, net	—		42,165		—		—			42,165
Other liabilities	—		33,979		9		—			33,988
Total Gentiva shareholders’ equity	277,381		957,985		27,210		(1,029,414		)	233,162
Noncontrolling interests	—		—		1,538		—			1,538
Total equity	277,381		957,985		28,748		(1,029,414		)	234,700
Total liabilities and equity	$	1,212,563	$	1,263,750	$	77,890	$	(1,043,269	)	$	1,510,934

Condensed Consolidating Statement of Comprehensive Income

For the Year Ended December 31, 2013

(In thousands)



	Gentiva Health Services, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Total
Net revenues	$	—		$	1,676,888		$	64,989		$	(15,233	)	$	1,726,644
Cost of services sold	—			905,261			52,152			(15,233		)	942,180
Gross profit	—			771,627			12,837			—			784,464
Selling, general and administrative expenses	—			(682,262		)	(19,454		)	—			(701,716		)
Goodwill, intangibles and other long-lived asset impairment	—			(610,436		)	—			—			(610,436		)
Interest (expense) and other, net	(110,477		)	—			93			—			(110,384		)
Equity in earnings of subsidiaries	(530,697		)	(4,561		)	—			535,258			—
(Loss) income before income taxes	(641,174		)	(525,632		)	(6,524		)	535,258			(638,072		)
Income tax benefit (expense)	42,180			(5,065		)	2,450			—			39,565
Net (loss) income	(598,994		)	(530,697		)	(4,074		)	535,258			(598,507		)
Noncontrolling interests	—			—			(487		)	—			(487		)
Net (loss) income attributable to Gentiva shareholders	$	(598,994	)	$	(530,697	)	$	(4,561	)	$	535,258		$	(598,994	)
Comprehensive (loss) income	$	(598,994	)	$	(530,697	)	$	(4,074	)	$	535,258		$	(598,507	)

Condensed Consolidating Statement of Comprehensive Income

For the Year Ended December 31, 2012

(In thousands)



	Gentiva Health Services, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Total
Net revenues	$	—		$	1,666,368		$	61,656		$	(15,220	)	$	1,712,804
Cost of services sold	—			884,903			39,058			(15,220		)	908,741
Gross profit	—			781,465			22,598			—			804,063
Selling, general and administrative expenses	—			(638,975		)	(16,791		)	—			(655,766		)
Goodwill, intangibles and other long-lived asset impairment	—			(19,132		)	—			—			(19,132		)
Gain on sale of assets and businesses, net	—			8,014			—			—			8,014
Interest (expense) and other, net	(90,054		)	—			107			—			(89,947		)
Equity in earnings of subsidiaries	79,622			3,038			—			(82,660		)	—
(Loss) income before income taxes and equity in net (loss) earnings of CareCentrix	(10,432		)	134,410			5,914			(82,660		)	47,232
Income tax benefit (expense)	37,228			(52,487		)	(1,992		)	—			(17,251		)
Equity in net (loss) earnings of CareCentrix	—			(2,301		)	—			—			(2,301		)
Net income	26,796			79,622			3,922			(82,660		)	27,680
Noncontrolling interests	—			—			(884		)	—			(884		)
Net income attributable to Gentiva shareholders	$	26,796		$	79,622		$	3,038		$	(82,660	)	$	26,796
Comprehensive income	$	26,796		$	79,622		$	3,922		$	(82,660	)	$	27,680

Condensed Consolidating Statement of Comprehensive Income

For the Year Ended December 31, 2011

(In thousands)



	Gentiva Health Services, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Total
Net revenues	$	—		$	1,757,459		$	52,404		$	(11,085	)	$	1,798,778
Cost of services sold	—			921,826			37,714			(11,085		)	948,455
Gross profit	—			835,633			14,690			—			850,323
Selling, general and administrative expenses	—			(715,343		)	(15,064		)	—			(730,407		)
Goodwill, intangibles and other long-lived asset impairment	—			(643,305		)	—			—			(643,305		)
Gain on sale of assets and businesses, net	—			1,061			—			—			1,061
Dividend income	—			8,590			—			—			8,590
Interest (expense) and other, net	(88,665		)	—			55			—			(88,610		)
Equity in earnings of subsidiaries	(380,176		)	221			—			379,955			—
Loss from continuing operations before income taxes and equity in net earnings of CareCentrix	(468,841		)	(513,143		)	(319		)	379,955			(602,348		)
Income tax benefit (expense)	18,316			56,637			815			—			75,768
Equity in net earnings of CareCentrix	—			68,381			—			—			68,381
(Loss) income from continuing operations	(450,525		)	(388,125		)	496			379,955			(458,199		)
Discontinued operations, net of tax	—			7,949			366			—			8,315
Net (loss) income	(450,525		)	(380,176		)	862			379,955			(449,884		)
Noncontrolling interests	—			—			(641		)	—			(641		)
Net (loss) income attributable to Gentiva shareholders	$	(450,525	)	$	(380,176	)	$	221		$	379,955		$	(450,525	)
Comprehensive (loss) income	$	(451,003	)	$	(380,176	)	$	862		$	379,955		$	(450,362	)

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2013

(In thousands)



	Gentiva Health Services, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations			Consolidated Total
OPERATING ACTIVITIES:
Net cash (used in) provided by operating activities	$	(29,406	)	$	80,742		$	(10,194	)	$	(4,037	)	$	37,105
INVESTING ACTIVITIES:
Purchase of fixed assets	—			(18,690		)	(385		)	—			(19,075		)
Proceeds from sale of businesses	—			508			—			—			508
Proceeds from the sale of assets	—			203			—			—			203
(Payments to) proceeds from affiliates	—			(7,400		)	—			7,400			—
Acquisition of businesses	—			(356,935		)	(2,500		)	—			(359,435		)
Net cash (used in) provided by investing activities	—			(382,314		)	(2,885		)	7,400			(377,799		)
FINANCING ACTIVITIES:
Proceeds from issuance of common stock	3,231			—			—			—			3,231
Windfall tax benefits associated with equity-based compensation	119			—			—			—			119
Payment of contingent consideration accrued at acquisition date	—			(1,675		)	—			—			(1,675		)
Proceeds from issuance of debt	817,525			—			—			—			817,525
Borrowings under revolving credit facility	27,000			—			—			—			27,000
Intercompany dividend	—			—			(2,300		)	2,300			—
Repayment of long-term debt	(610,182		)	—			—			—			(610,182		)
Debt issuance costs	(15,187		)	—			—			—			(15,187		)
Investment in affiliate	—			—			5,000			(5,000		)	—
Minority interest capital contribution	—			—			1,600			—			1,600
Majority interest capital contribution	—			—			2,400			(2,400		)	—
Distribution to minority interests	—			—			(750		)	—			(750		)
Distribution to majority interests	—			—			(1,737		)	1,737			—
Other	(889		)	(28		)	(165		)	—			(1,082		)
Net payments related to intercompany financing	(303,275		)	303,275			—			—			—
Net cash provided by (used in) financing activities	(81,658		)	301,572			4,048			(3,363		)	220,599
Net change in cash and cash equivalents	(111,064		)	—			(9,031		)	—			(120,095		)
Cash and cash equivalents at beginning of period	166,140			—			40,912			—			207,052
Cash and cash equivalents at end of period	$	55,076		$	—		$	31,881		$	—		$	86,957

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2012

(In thousands)



	Gentiva Health Services, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated Total
OPERATING ACTIVITIES:
Net cash (used in) provided by operating activities	$	(18,089	)	$	138,316		$	5,741		$	—	$	125,968
INVESTING ACTIVITIES:
Purchase of fixed assets	—			(11,609		)	(170		)	—		(11,779		)
Proceeds from sale of businesses	—			9,220			—			—		9,220
Acquisition of businesses	—			(22,335		)	—			—		(22,335		)
Net cash used in investing activities	—			(24,724		)	(170		)	—		(24,894		)
FINANCING ACTIVITIES:
Proceeds from issuance of common stock	3,980			—			—			—		3,980
Windfall tax benefits associated with equity-based compensation	88			—			—			—		88
Repayment of long-term debt	(52,943		)	—			—			—		(52,943		)
Debt issuance costs	(4,125		)	—			—			—		(4,125		)
Repurchase of common stock	(4,974		)	—			—			—		(4,974		)
Repayment of capital lease obligations	(135		)	—			—			—		(135		)
Other	4,673			(28		)	(5,470		)	—		(825		)
Net payments related to intercompany financing	113,564			(113,564		)	—			—		—
Net cash provided by (used in) financing activities	60,128			(113,592		)	(5,470		)	—		(58,934		)
Net change in cash and cash equivalents	42,039			—			101			—		42,140
Cash and cash equivalents at beginning of period	124,101			—			40,811			—		164,912
Cash and cash equivalents at end of period	$	166,140		$	—		$	40,912		$	—	$	207,052

Condensed Consolidating Statement of Cash Flows

For the Year Ended December 31, 2011

(In thousands)



	Gentiva Health Services, Inc.			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Eliminations		Consolidated Total
OPERATING ACTIVITIES:
Net cash (used in) provided by operating activities	$	(46,730	)	$	51,221		$	650		$	—	$	5,141
INVESTING ACTIVITIES:
Purchase of fixed assets	—			(19,053		)	(178		)	—		(19,231		)
Proceeds from sale of businesses	—			146,261			54			—		146,315
Acquisition of businesses	—			(320		)	—			—		(320		)
Net cash provided by (used in) investing activities	—			126,888			(124		)	—		126,764
FINANCING ACTIVITIES:
Proceeds from issuance of common stock	7,901			—			—			—		7,901
Windfall tax benefits associated with equity-based compensation	192			—			—			—		192
Repayment of long-term debt	(63,438		)	—			—			—		(63,438		)
Debt issuance costs	(15,460		)	—			—			—		(15,460		)
Repayment of capital lease obligations	(267		)	—			—			—		(267		)
Other	—			(22		)	(651		)	—		(673		)
Net payments related to intercompany financing	178,087			(178,087		)	—			—		—
Net cash provided by (used in) financing activities	107,015			(178,109		)	(651		)	—		(71,745		)
Net change in cash and cash equivalents	60,285			—			(125		)	—		60,160
Cash and cash equivalents at beginning of period	63,816			—			40,936			—		104,752
Cash and cash equivalents at end of period	$	124,101		$	—		$	40,811		$	—	$	164,912