Coastal executes commitment letter to secure financing through National Century Financial Enterprises.

DURHAM, N.C.--(BUSINESS WIRE)--March 24, 1997--Coastal Physician Group Inc. (NYSE:DR) today announced that the company has executed a commitment letter with National Century Financial Enterprises Inc. (NCFE) to enter into a financing relationship to provide Coastal with financing to retire in full the company's outstanding indebtedness to its current bank lenders and to provide additional working capital.

The commitment provides for the purchase of, and/or loans secured by, Coastal's eligible healthcare accounts receivable in an aggregate amount of up to $92 million, and a secured Revolving Credit Facility of $3.5 million to support letters of credit. Consummation of this transaction is expected to occur by May 15, 1997 and is subject to the satisfaction of numerous terms and conditions, including the execution of definitive documentation. A termination fee would be paid to NCFE by Coastal if NCFE is able to perform and Coastal is unable to fulfill the terms of the executed commitment letter. Other terms of the proposed transaction were not disclosed.

Separately, Coastal announced that Edward L. Suggs Jr. and Deborah L. Redd were named to the company's board of directors, filling two vacancies on the nine-member board. The company also reported that Henry J. Murphy resigned from the board to pursue another business opportunity. A replacement has not been named to fill the vacancy at this time.

Mr. Suggs, age 46, is president and chief executive officer of Healthcare Business Resources Inc. (HBR), the company's physician billing and collection services subsidiary. He joined Coastal in 1986 as chief operating officer of HBR, was named its president in 1987, and served as a director of the company from 1989 to 1994.

Prior to joining Coastal, Mr. Suggs worked for five years with the accounting firm of Ernst & Young, and served in the United States Air Force for 10 years. He is a member of the North Carolina Association of Certified Public Accountants and the Healthcare Financial Management Association. Mr. Suggs holds a bachelor's degree in accounting from the University of North Carolina at Charlotte.

Ms. Redd, age 48, has been president of Coastal's Managed Care division since January 1996 after joining the company in October 1995. From 1990 to 1995, Ms. Redd was vice president, Network Development for Blue Cross/Blue Shield of Maryland, Inc. (BCBSM), and was responsible for managing provider networks, negotiating contracts with health care providers, and gaining National Committee for Quality Assurance (NCQA) certification for BCBSM's managed care organization.

From 1977 to 1990, she held various executive positions with Chesapeake Physician, P.A., a multi-speciality physician group associated with the Johns Hopkins School of Medicine. Ms. Redd is a member of the American Heart Association and the Baltimore Regional Burn Center Association. She holds a bachelor's degree in accounting from the University of Cincinnati.

Coastal Physician Group Inc. is a diversified physician management company providing a broad range of health care and administrative services to physicians, hospitals, employers, managed care programs and other health care providers.

This news release contains statements that are forward-looking in nature, and are inherently subject to uncertainties. Actual results may differ materially from those reflected in the forward-looking statements based on a number of important risk factors, including, but not limited to: the possibility of poor accounts receivable collection and/or reimbursement experience; the inability to obtain continued and/or additional neccessary working capital financing as needed; and other important factors disclosed from time to time in the Company's Form 10-K, Form 10-Q and other Securities and Exchange Commission filings.

CONTACT: Coastal Physician Group, Durham

Robert P. Borchert, 919/383-0355