Dynacq Healthcare Inc. Announces Settlement Of Vista Hospital Of Baton Rouge Lawsuit

HOUSTON--(BUSINESS WIRE)--Feb. 28, 2005--Dynacq Healthcare Inc. (OTCBB:DYII) ("Dynacq") announced today that Dynacq, its subsidiary Vista Hospital of Baton Rouge, LLC and Chiu M. Chan, its chief executive officer, have entered into a settlement agreement with Liljeberg Enterprises International, L.L.C. to settle all matters between the parties. Dynacq agreed to pay $1.2 million in cash to Liljeberg, and Liljeberg agreed to a full and final release of Dynacq, Vista Hospital of Baton Rouge and Chui M. Chan from any and all claims brought by Liljeberg and any of its affiliates against Dynacq and its affiliates. The Board of Directors of Dynacq approved the terms of the settlement on Feb. 25, 2005. The settlement agreement is subject to the approval of the United States Bankruptcy Court. Liljeberg has further agreed not to oppose the Plan of Reorganization filed by Vista Hospital of Baton Rouge, which is expected to be confirmed in the near future. Once the settlement is final, Liljeberg has agreed to cause to be dismissed with prejudice any and all lawsuits filed by Liljeberg or any of its affiliates and pending against Dynacq or any of its affiliates.

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