MIAMI--(BUSINESS WIRE)--March 24, 2006--Pacer Health Corporation (OTCBB:
PHLH -
News), an owner-operator of acute care hospitals, medical treatment centers and psychiatric care facilities in the Southeastern United States, announced today that effective immediately, it has assumed the management and operation of Knox County Hospital, a 42-bed, state-of-the-art acute care facility in Barbourville, Kentucky.
Pacer Health signed a binding letter of intent with Knox County in early February to lease the facility with an option to purchase it during the contract period. Under the terms of that agreement, Pacer Health would capture all revenues from the operation of Knox County Hospital during the lease period and also fund any operational losses.
Pacer Health has completed an initial management agreement and memorandum of understanding that will allow the company to assume immediate control of the hospital. As part of the transaction, Pacer Health management reported this morning that it has made a payment in the amount of $250,000 to Knox County to solidify the interim agreement and fund a portion of the hospital's debt. The agreement carries a penalty of $750,000 if either party were to terminate the contract during the bond refinancing period. The county needs to refinance their bond debt to effectuate the transaction. Both parties anticipate that such refinancing will be completed within 60 to 90 days.
"We are excited about acquiring managerial control of Knox County Hospital," said Rainier Gonzalez, chairman and CEO of Pacer Health. "Knox County is in the process of working to refinance their bond debt and we are both committed to finalizing this transaction as expeditiously as possible."
Knox County Hospital offers a comprehensive suite of healthcare services, including nuclear medicine, surgical services, physical therapy, spiral C.T., mammography, 24-hour emergency services, and a 16-bed skilled nursing unit. The hospital employs a staff of more than 250 and receives more than 16,000 emergency room visits each year.
About Pacer Health Corporation
Pacer Health Corporation is an owner-operator of acute care hospitals, medical treatment centers, and psychiatric care facilities serving non-urban areas throughout the Southeast. Please visit http://www.pacerhealth.com for more information.
Legal Notice Regarding Forward-Looking Statements: "Forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995 may be included in this news release. These statements relate to future events or our future financial performance. These statements are only predictions and may differ materially from actual future results or events. Pacer Health disclaims any intention or obligation to revise any forward-looking statements whether as a result of new information, future developments or otherwise. There are important risk factors that could cause actual results to differ from those contained in forward-looking statements, including, but not limited to, risks associated with changes in general economic and business conditions, actions of our competitors, and changes in our business strategies.
