The Future of Rockdale Medical Center

1. What was announced?

The Hospital Authority of Rockdale County and the Rockdale Medical Center Inc. board of directors selected Signature Hospital Corporation to purchase Rockdale Medical Center.

2. Why Signature?

The Authority and Board chose Signature because of their:

Unique focus on community hospitals and an understanding of the challenges they face;
Their commitment to quality in each of their hospitals;
Strong commitment to Rockdale Medical Center and the Conyers community and;
Combined strengths of financial and management resources needed to address the challenges faced by Rockdale Medical Center.

3. What is Signature paying for Rockdale Medical Center?

The purchase price is approximately $90 million. With that, Rockdale Medical Center will pay off our debt and other expenses.

The remaining proceeds from the sale, after the debt and other expenses are paid, will be held by the Hospital Authority and used to provide, participate in, or support charitable health care services throughout Rockdale County.

The Hospital Authority will keep the principal of those funds intact for at least seven years after the sale, so that it can exercise its right of first refusal if the hospital should come up for sale during that time.

Also, Rockdale Medical Center will be a new taxpayer in the community, representing significant new tax revenue for Rockdale County.

4. Why was a sale the best solution for Rockdale Medical Center?

To meet the growing needs of Rockdale County, the Hospital has heavily invested in facility improvements and an entirely new information technology system. The organization issued a significant amount of debt to fund the expansion in 2002.

Meeting the financial requirements -- commonly called covenants -- of these bonds, while also investing in the future, presents a challenge for the Hospital.

While we have made progress – the hospital was successful in meeting our bond covenants for Fiscal Year 2006 after not meeting them in 2005 -- we recognize that Rockdale Medical Center needs long-term financial stability needed to deliver excellent patient care.

The boards of the Medical Center and the Hospital Authority studied the needs of the hospital for more than a year, sought the advice of nationally recognized healthcare experts and followed a performance improvement plan.

After more than a year of careful and deliberate evaluation, the unanimous conclusion of all concerned is that a purchase by a strong partner is the best solution for the Hospital, its employees and physicians and the residents of Rockdale County.

In Signature, we have found that partner.

5. What were Rockdale Medical Center’s criteria in searching for a partner?

Board members were looking for a partner for the Hospital who would:

Support local leadership and the Conyers’ community;
Value partnerships and strong relationships with the community, employees and physicians;
Fully commit to strengthen the quality of care and patient satisfaction;
Invest attention and capital into the Hospital to strengthen the quality of care;
Bring resources and expertise in recruiting and retaining physicians;
Commit to growing current patient services and adding new services;
Ensure the long-term vitality of Rockdale Medical Center.

Using these criteria, the board members evaluated a number of potential partners interested in the Hospital. In fact, board members visited hospitals operated by several of the bidders and interviewed their local nurses and physicians.

6. What are the highlights of the deal?

A purchase price of approximately $90 million. The final figure will be determined at the time the transaction is concluded, which will follow the approval of state officials.
With the lease between the Hospital Authority and Rockdale Medical Center, Inc. terminated, the remaining proceeds from the sale, after the debt and other expenses are paid, will be held by the Hospital Authority and used for charitable health care services throughout Rockdale County.
The Hospital Authority will keep the principal of those funds intact for at least seven years after the sale, so that it can exercie its right of first refusal if the hopsital should come up for sale during that time.
Under the terms of the agreement, Signature is committed to investing at least 32 million in Rockdale Medical Center over the next five years. These funds will go toward facility improvements and expansion of services as well as new medical equipment for the benefit of the hospital.
Offers of employment to all active Rockdale Medical Center employees at the time of the closing of the transaction and full credit for the current years of service and rates of pay.
The newly formed hospital Board of Trustees will be composed of medical staff, community members and the newly appointed hospital CEO.
For at least three years after the closing, the Hospital Authority of Rockdale County can appoint a local representative to the Signature Hospital Corporation Board of Directors.
A minimum 10-year commitment by Signature to maintain the hospital’s core general acute care services, including emergency services and obstetrics.
A commitment by Signature to provide the same level of indigent care that the hospital provides today.

7. What happens now?

This announcement marks the beginning of a public process, which is governed by Georgia law through the Attorney General’s office. On September 30,2007, the Hospital Authority of Rockdale County, Rockdale Medical Center and Signature submitted a filing with the Georgia Attorney General.

Citizens have the opportunity to participate in the process. This purchase requires approval from the Georgia Attorney General, who will hold a hearing on November 14 at 5:30 p.m. at the Rockdale at 5:30 p.m. at the Rockdale County Auditorium to, among other things, gain local input and disclose the purpose and terms of the transaction.

8. If all goes well, when will the sale be complete?

It is our hope to complete the transaction by year end, following all appropriate regulatory approvals.

9. What happens at the Hospital between today’s announcement and the completion of the sale?

It’s business as usual at the Hospital. Until the transaction is completed, we will continue to operate as we do today. Our focus should remain where it always has: Providing our patients great care. If there is any change at all, it will be the presence of Signature representatives in our hospital from time to time.

10. Will the Hospital’s name change if the sale is completed?

No. Rockdale Medical Center will keep its current name.

11. Why does Signature want to purchase Rockdale Medical Center?

Signature is honored at the opportunity to become a part of your community. The company sees in Rockdale County a growing, vibrant community.

All of the things that you value in Rockdale Medical Center – convenience, trusted caregivers and physicians, access to services you and your family need – make the hospital a cherished cornerstone of your community. We want to strengthen that.

Signature strongly believes that with the proper amount of management attention and capital investment, Rockdale Medical Center can reach its full potential and continue to serve the community for years to come.

12. What changes will be made to the Hospital by Signature if the sale is completed?

Signature will immediately begin searching for a new, permanent CEO for the hospital. The hospital needs an experienced, seasoned leader to carry it forward.

Over the coming weeks, the company will work hard to learn more about the Hospital from employees, patients, physicians and community members who know it best. Signature’s goals are to strengthen the Rockdale Medical Center attributes valued by your community and to find solutions for your concerns.

Signature is focused on growth. The company is committed to growing the Hospital’s market share by recruiting new physicians, adding new programs and investing in new technology.

13. Will there be layoffs as a result of the sale?

Signature will retain all active employees of Rockdale Medical Center at the time this purchase is finalized. Signature is focused on growth. The company is committed to growing the Hospital's market share by recruiting new physicians, adding new programs, and investing in technology.

14. Will employee benefits change with Signature?

Signature will offer a competitive benefits package that is comparable with the benefits currently offered to RMC employees.

Also, Hospital employees will receive full credit for the current years of service and maintain their current rate of pay.

Over the coming weeks, we will work with employees to answer all of these questions. Signature will hold a series of meetings with employees to explain benefits information over the coming weeks.

15. How will this purchase impact physicians?

Signature views physicians – and employees – as partners. The company will work in tandem with physicians at the Hospital on operational decisions.

As part of the purchase agreement, Signature will maintain medical staff status and privileges for current members of the Hospital medical staff for a minimum of one year after the purchase is complete.

Signature strongly believes that the Rockdale County community is a terrific place to recruit new physicians. The company will work hard to add to the Hospital’s already strong medical staff.

16. Will Signature offer joint venture opportunities to physicians?

The proposed purchase of Rockdale Medical Center by Signature is not contingent upon physician joint venturing, however Signature is open to opportunities that allow the Hospital to reach its full potential as long as those decisions fit the hospital’s strategic vision and they fall well within the bounds of current state and federal regulations.

17. How will the Authority use the left over proceeds from the sale of Rockdale Medical Center?

18. How will the Authority decide what to invest in?

All funds remaining after the sale, which are expected to be approximately $55-60 million after the payment of all debt, will be used by the Hospital Authority of Rockdale County for charitable healthcare services throughout Rockdale County.

19. What other hospitals does Signature own?

Other hospitals in the Signature family include 115-licensed bed Pampa Regional Medical Center in Pampa, Texas; 161-licensed bed Gulf Coast Medical Center in Wharton, Texas; 79-licensed bed Medical Park Hospital in Hope, Ark and 325-licensed bed St. Joseph’s Hospital, in Parkersburg, West Virginia.

20. Are Signature’s hospitals certified by the Joint Commission?

Yes. All our hospitals have been certified by the Joint Commission and we are committed to maintaining those certifications and continuing to operate under the commission’s standards of excellence.

21. How is Signature involved in its communities?

Two ways.

One, each of our hospitals has its own unique community outreach plan because each community is different. Because of their local nature, community hospitals must be able to react to the unique needs of their communities.

For example, at St. Joseph’s hospital in Parkersburg, W. Va., the hospital worked with nearly 30 local nonprofit organizations last year and more than 300 students completed their clinical rounds at the hospital.

Two, each one of the hospitals in the Signature family has a local board of trustees that guide the organization. Rockdale Medical Center will have local representation on its board as well.

22. How can I find out more about this transaction?

Visit www.futureforrockdale.com.

23. How can I find out more about Signature?

Visit www.signaturehospital.com. In addition, Signature representatives will be in the hospital and in the community over the coming weeks to visit and share more information.