Orderly Sale Will Ensure Stability and Continuity of Medical Care to Served Rhode Island Communities

Transaction Represents Highest and Best Offer for Facilities, Thereby Maximizing Value

Prospect Medical Holdings, Inc. (“Prospect Holdings” or the “Company”) today announced that it has entered into an amended and restated asset purchase agreement (the “APA”) to sell CharterCARE Health Partners, including the Roger Williams Medical Center, Our Lady of Fatima Medical Center, and the remainder of its coordinated health care network, to The Centurion Foundation, Inc. and other nonprofit corporations. The proposed sale is the product of an extensive, years-long prepetition marketing and regulatory approval process, and will ensure the stability and continuity of medical care to current patients and the communities that rely on these facilities.

Prospect Holdings and The Centurion Foundation entered into the initial asset purchase agreement in November 2022. However, the parties were unable to close the sale at that time, but remained committed to consummating the transaction, ultimately resulting in the amended APA.

Jeffrey Liebman, Chief Executive Officer CharterCARE Health Partners, said, “At CharterCARE Health Partners, we’re committed to providing our patients with convenient access to exceptional health care at every level, directed by skilled physicians, nurses, and other health professionals. Entering into this transaction and transitioning ownership of the Roger Williams Medical Center and Our Lady of Fatima Medical Center to nonprofit healthcare operators will ensure that commitment continues to be upheld long into the future. This is a positive development for our employees, physicians, and the Rhode Island communities we serve on a daily basis.”

Ben Mingle, President and CEO of The Centurion Foundation, said, “The Centurion Foundation is pleased that an amended asset purchase agreement for the acquisition of CharterCARE Health Partners has been reached with Prospect. We hope for a favorable decision from the bankruptcy court that will allow this important transaction to move forward and secure the future stability of these two critical hospitals. We appreciate all the support received from the Rhode Island community and are excited to return the CharterCARE Health System to non-profit status and local control.”

The sale and APA are subject to approval by the Bankruptcy Court and satisfying customary closing conditions. Prospect Holdings will seek Bankruptcy Court approval of the sale and APA at a hearing currently scheduled to occur on February 12, 2025. The parties intend to close the sale shortly thereafter.

Additional Information

Additional information regarding the Bankruptcy Court-supervised sale and restructuring process can be found at www.pmhrestructuring.com. Bankruptcy Court filings and other information related to the proceedings are available on a separate website administrated by the Company’s claims agent, Omni Agent Solutions, Inc. (“Omni”), at https://omniagentsolutions.com/Prospect, by calling Omni toll-free at (888) 550-3239 (or (818) 510-3746 for calls originating outside of the U.S. or Canada), or by sending an email to ProspectInquiries@OmniAgnt.com.

Advisors

Sidley Austin LLP is serving as legal counsel, Houlihan Lokey Capital Inc. is serving as investment banker, and Alvarez & Marsal North America, LLC is serving as financial advisor to Prospect Holdings.

About Prospect Medical Holdings, Inc.

Prospect Medical Holdings, Inc. consists of hospitals and affiliated medical groups working for the benefit of every person who comes to us for care. Our comprehensive networks aim to provide coordinated, personalized care to California, Connecticut, Pennsylvania, and Rhode Island.

Cautionary Statement Concerning Forward-Looking Statements

This press release contains forward-looking statements. These forward-looking statements include statements regarding the process and potential outcomes and timing of the Company’s chapter 11 proceedings, and the Bankruptcy Court’s approval thereof. Words such as “anticipate,” “believe,” “budget,” “contemplate,” “continue,” “could,” “envision,” “estimate,” “expect,” “guidance,” “indicate,” “intend,” “may,” “might,” “plan,” “possibly,” “potential,” “predict,” “probably,” “pro forma,” “project,” “seek,” “should,” “target,” or “will,” or the negative or other variations thereof, and similar words or phrases or comparable terminology, are intended to identify forward-looking statements. These forward-looking statements reflect the Company’s expectations, plans or forecasts of future events and views as of the date of this press release. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside the Company’s control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements.

Important risks and uncertainties that could cause the Company’s actual results and financial condition to differ materially from those indicated in forward-looking statements include, among others, the Company’s future capital requirements and sources and uses of cash, including funds to satisfy its liquidity needs; the Company’s ability to fund its planned operations and its ability to continue as a going concern; the adverse impact of the chapter 11 proceedings on the Company’s business, financial condition, and results of operations; the Company’s ability to maintain relationships with patients, employees, doctors, health plans and other key payers and other third parties as a result of the chapter 11 proceedings; the effects of the chapter 11 proceedings on the Company and the interests of various constituents; the Company’s ability to obtain court approvals with respect to motions filed or other requests made to the Bankruptcy Court throughout the course of the chapter 11 proceedings; and risks associated with third-party motions in the chapter 11 cases. All information provided in this press release is as of the date hereof, and the Company undertakes no duty to update or revise this information unless required by law, and forward-looking statements should not be relied upon as representing the Company’s assessments as of any date subsequent to the date of this press release.

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