Universal Health Services- $210 million for Keys Group/Keystone Education and Youth Services

Universal Health Services 2005 Annual Report
page 89
paragraph 10.27:
Ownership Interest Purchase Agreement, dated as of October 3, 2005, among Harbinger Private Equity Fund I,L.L.C., Keystone Group Kids, Inc., Michael Lindley, Marty Weber, Ameris Healthcare Investments, LLC, Rainer Twiford, Al Smith, Mike White, Rodney Cawood, Buddy Turner, Jeff Cross, Gail Debiec, Brad Gardner, Brad Williams, Don Wert,Rob Minor, Mike McCulla, Jim Shaheen, Rob Gaeta, and Universal Health Services, Inc., previously filed as Exhibit 10.1 to Registrant’s Current Report on Form 8-K, dated October 11, 2005, is incorporated herein by reference.
UHS and Keystone purchase agreement
With this one acquisition,UHS Behavioral Health nearly doubled in size, adding a total of 46 Keystone facilities in ten states – including 21residential treatment
facilities with 1,280 beds,21 non-public therapeutic day schools, and four detention facilities.

The acquisition is expected to generate approximately $165 million of annual revenue. Just as important, it offers UHS exciting opportunities for entirely new behavioral care disciplines.

Keystone’s residential facilities and day schools have earned a national reputation for treating “at risk” young people with autism and other behavioral needs.  .

These young people face serious problems, including disruptive or aggressive behavior, failing grades, addictions, and severe depression.
Generally, their families and schools have tried to help, but lack the resources and expertise needed to achieve breakthrough results.

Accepting even the kids that no one else will take, Keystone offers structure, teaching, discipline, and love – in a safe and supportive environment.  Keystone provides each child with a service advocate, who represents the child’s best interests during every phase of the treatment process. The advocate works to find a program that will help the child. And, he or she serves as a liaison between the facility, the child’s family, and the referral source to ensure the highest
standards of quality care.

Commenting on the Keystone acquisition, Debra K. Osteen, President of UHS’s Behavioral Health division, stated, “The facilities we are acquiring provide an opportunity to expand our residential treatment facilities,
which have been a solid performer for the division.

“In addition,” Ms. Osteen said, “the acquisition enables us to enter a new business in non-public therapeutic day schools.  We believe there is a need
for this service and hope to expand the current operations and grow in other areas of the country.”

While Keystone was the biggest development of 2005, it was not the only
acquisition made by our dynamic Behavioral Health division.
Structure:
Keys Group Holding,LLC
Children’s Comprehensive Services, Inc
       Keystone/CCS Partners, LLC – 85% owned by Keys Group Holding,LLC and  15% owned by Children’s Comprehensive Services, Inc.
         Kids First Foundation – non-profit
Keystone Nevada, LLC
Keystone Memphis, LLC
Keystone Education Transportation, LLC
Elmira NPS, LLC
Alicante School Elk Grove, LLC
Keystone Savannah, LLC
Keystone Newport News, LLC
Keystone Marion, LLC
Keystone WSNC, L.L.C.
Keystone Oklahoma City, LLC
CCS/Altacare of Arkansas, Inc.
Chad Youth Enhancement Center, Inc.
CCS/Bay County, Inc.
CCS/Meadow Pines, Inc.
Ventures Healthcare of Gainesville, Inc.
CCS/Little Rock, Inc.
CCS/Rivendell of Kentucky, Inc.
CCS/Lansing, Inc.
Associated Child Care Educational Services, Inc.
American Clinical Schools, Inc.
Alabama Clinical Schools, Inc.
Pennsylvania Clinical Schools, Inc.
Tennessee Clinical Schools, Inc.
Keystone NPS, LLC
Keystone Continuum, LLC
Keystone Detention, LLC
Keystone Richland Center, LLC
Keystone DJJ, LLC
Keystone Charlotte, LLC
Keystone JJAEP, LLC

Facilities
Alabama Clinical Schools  AL
Tennessee Valley Juvenile Detention Center AL
Tuscaloosa Juvenile Detention Center AL
Bristol Youth Academy FL
Jacksonville Youth Center FL
The H.O.P.E. Program FL
Nueces County Juvenile Justice TX
Cedar Grove TN
Chad Youth Enhancement Center TN
Cherokee Park Youth Center TN
Compass Intervention Center TN
Hermitage Hall TN
McDowell Center for Children TN
Natchez Trace Youth Academy TN
Upper East Tennessee TN
Old Vineyard Youth Services NC
The Keys of the Carolinas NC
Keystone Newport News Youth Center VA
Marion Youth Center VA
Pennsylvania Clinical Schools PA
Children’s Comprehensive Services of Ohio OH
Turning Point Youth Center MI
Highlander Children’s Services CA
Keystone Carmichael CA
Keystone Desert Hot Springs CA
Keystone Elmira CA
Keystone Grand Terrace CA
Keystone Hemet CA
Keystone Highlander CA
Keystone Laguna CA
Keystone Mar Vista CA
Keystone Ramona CA
Keystone Rancho Cucamonga CA
Keystone Riverside CA
Keystone Steele Canyon CA
Keystone Vallejo CA
Keystone Van Nuys CA
Keystone Victorville CA
Keystone Ventura CA
 
CIT Capital Securities,LLC received $300,000 at closing
Waller Lansden received it’s fees