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Notice of Intention to Bid on May 21, 2008

$40,000,000 Kentucky Economic Development Finance Authority

Adjustable Rate Medical Center Revenue Improvement Bonds, Series 2006
(Ashland Hospital Corporation, d/b/a King's Daughters Medical Center Project)

Short-Term Adjustable Rate Securities (STARS)

CUSIP #491269 CF1

NOTICE IS HEREBY GIVEN to the holders of the above-named bonds (the "Bonds") as follows:

  1. Ashland Hospital Corporation, d/b/a King's Daughters Medical Center (the "Corporation") intends to submit a bid on the Auction Dates commencing on or after May 21, 2008 (the "5/21 Auction Date"), for all of the Bonds at an annual rate of interest equal to SIFMA plus a spread of 25 basis points (the "Bid Notice Rate"), directly or through participating dealers.

    If the Corporation submits a bid for the Bonds, the Corporation will submit a bid for 100% of the outstanding Bonds and purchase any Bond allocated to the Corporation in the auction with funds available to the Corporation or one of its affiliated entities, including funds available under an existing or future credit facility.

    The Corporation will promptly purchase from any Bondholder, any Bonds held by the Bondholder after the 5/21 Auction Date specified above at a purchase price equal to par plus accrued and unpaid interest thereon. If any Bondholder is unable to sell such Bonds in the 5/21 Auction, or would like to sell such Bonds after the auction results for the auction are specified, such Bondholder should contact the Bondholder's broker or the contact person for the Corporation listed at the end of this Notice.

    Until further notice is given by the Corporation to the Nationally Recognized Municipal Securities Information Repositories, the Corporation intends to bid in all future auctions for the Bonds in accordance with the procedures described below, and will purchase any Bonds from a Bondholder after each auction as described above; provided that, there can be no assurance that the Corporation will submit bids for the Bonds or purchase the Bonds.
  2. Any Existing Owner who submits a "Hold Order" or who has not submitted an Order, and who is therefore deemed to have submitted a "Hold Order" and who does not wish to continue to own Bonds bearing interest at the Bid Notice Rate (or lower rate if another qualified bidder submits a bid that is lower than the Bid Notice Rate) shall be given until 5 o'clock p.m., New York City time, on May 23, 2008, to give notice (a "Sell Notice") to Bear Stearns, as Broker-Dealer, that the Existing Owner does not wish to hold Bonds at the Bid Notice Rate and that it offers to sell such Bonds to the Corporation at a price equal to the principal amount thereof plus accrued interest to the date of purchase, and the Corporation will purchase any of the Bonds subject to such Sell Notice on a delivery-versus-payment basis on Tuesday, May 27, 2008.
  3. Schedule A contains a listing of the types of orders and, where applicable, the interest rates bid, together with the related principal amounts of Bonds subject to such orders, submitted in the May 14, 2008 auction. Additional information on that auction is provided below.

Amount of Bonds Available for Sale in the Auction

$200,000

Number of Bids Received

7

Amount of Bids Received

$11,445,000

Number of Bids Received Other than from Issuer, the Corporation or Broker

6

Amount of Bids Received Other than from Issuer, the Corporation or Broker-Dealer

$3,500,000

Number of Bids Received by Broker in the Auction

0

Amount of Bids Received by Broker in the Auction

$0

Interest Rate Bid by Broker in the Auction

N/A

Number of Bids by the Corporation in the Auction

1

Amount of Bids by the Corporation in the Auction

$7,945,000

Interest Rate Bid by the Corporation in the Auction

2.83%

Clearing Rate

2.83%

Low Bid

2.83%

High Bid

5.00%

Median Bid

3.50%

  1. There can be no assurance that the Bid Notice Rate is not below a market-clearing interest rate in today's market, which is why the Corporation is making the offer to purchase the Bonds of any Existing Owners who submit Hold Orders (or who are deemed to have submitted Hold Orders) as described in paragraph 2 above.

ASHLAND HOSPITAL CORPORATION D/B/A

KING'S DAUGHTERS MEDICAL CENTER

Paul McDowell, Chief Financial Officer (606) 408-4404

SCHEDULE A

Order Type

Rate

Bonds Ordered

Bonds Filled

 

 

 

 

Sell

 

200,000

200,000

 

 

 

 

 

 

 

 

Hold

 

39,800,000

39,800,000

 

 

 

 

 

 

 

 

Buy*

2.83%

7,945,000

200,000

Buy

3.00%

250,000

-

Buy

3.39%

500,000

-

Buy

3.50%

1,000,000

-

Buy

4.00%

1,000,000

-

Buy

4.70%

500,000

-

Buy

5.00%

250,000

-

 

 

 

 

 

Sub-Total

11,445,000

200,000

 



 

 

 

TOTAL

51,245,000

40,000,000

* Bid by the Corporation.

This Notice is not an offer to sell securities or the solicitation of an offer to buy securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities law of such jurisdiction. Nothing in the Notice is, or should be construed as, a representation by the Corporation that the information included in this Notice constitutes all of the information that may be material to a decision to invest in, hold or dispose of any of the Bonds, or any other securities of the Corporation.

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