Though HealthSouth Corp.'s $1.25 billion credit facility is in default, the company says banks that have lent it money have agreed to refrain pressing for payments until May 1.
The Birmingham, Ala.-based company, the nation's largest operator of outpatient surgery and rehabilitation centers, reports that it has entered into a forbearance agreement with a group of bank lenders headed by JPMorgan Chase Bank and Wachovia Securities.
Under the agreement, the banks will refrain from exercising remedies arising from the default of the company's credit facility, the company said a release Thursday.
On March 27, HealthSouth announced it was in default of its credit facility, due to recent government investigations.
The company and former executives, including former Chairman and CEO Richard Scrushy, are under investigation for allegedly overstating earnings by nearly $2.5 billion since 1997.