MIAMI--(BUSINESS WIRE)--May 8, 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, today announced that the Knox County Hospital Board has accepted the company's bid to lease Knox County Hospital, a 42-bed, state-of-the-art acute care facility in Barbourville, Kentucky, effective immediately.
Pacer Health's bid is consistent with a binding letter of intent signed in early February to lease the facility for ten years with an option to purchase it outright after the first year of the contract period.
Under the terms of the agreement, Pacer Health would capture all revenues from the operation of Knox County Hospital during the lease period and also would fund any operational losses. Pacer Health agrees to pay Knox County approximately $15,000,000, which will allow the county to satisfy bonds used to assume hospital debt when it was purchased from bankruptcy in 2004; this in turn allows the county to effectuate the lease transaction.
Pacer Health completed an initial management agreement and memorandum of understanding that allowed the company to assume managerial and operational control of the hospital in March. Under the terms of that agreement, Pacer Health agreed to preserve the full suite of healthcare services currently available at the hospital, including general healthcare and emergency services for the area's indigent population. The Hospital Board's approval of Pacer Health's bid allows the company to continue management of the facility pursuant to this earlier agreement.
"Pacer Health can now turn its attention to the operation of Knox County Hospital, a facility so vital to the economy of rural Southeastern Kentucky, not to mention the physical well-being of area residents," said Rainier Gonzalez, chairman and CEO of Pacer Health. "The Knox County Hospital Board and Pacer Health are collectively committed to keeping this facility open and preserving the broad range of quality healthcare services this area demands."
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, the extent to which we are able to develop new services and markets for our services, the level of demand and market acceptance of our services, and changes in our business strategies.
