SunLink Health Systems Announces Private Placement of Shares and Modification and Extension of Credit Agreement

SunLink Health Systems, Inc. SSY today announced the private placement of 1,337,637 common shares at $1.90 per share with certain of its officers and directors and/or their affiliates. The net proceeds of the private placement of approximately $2,500,000 were used, together with the company's operating funds, to make an $8,000,000 pre-payment on the company's term loan. Concurrent with and conditioned upon the term loan pre-payment, the company's lenders modified the company's existing credit agreement to reduce the interest rate, revise certain financial and other covenants and extend the maturity date of the credit agreement until January 1, 2013. A special committee of the company's Board of Directors comprised of disinterested directors evaluated the private placement transaction and obtained an opinion of an outside advisor selected by the special committee that the price and terms of the private placement were fair from a financial point of view to the company.