Affiliates of Angelo, Gordon & Co. and National Home Health Care Corp. Enter into Merger Agreement

  
    
  
  
    
      Angelo, Gordon & Co. and National Home Health Care Corp. (National 
      Market: NHHC), a provider of home health care and staffing services in 
      the Northeast, today announced that NHHC and affiliates of Angelo Gordon 
      have entered into an Agreement providing for the merger of NHHC with an 
      affiliate of Angelo Gordon, in partnership with Eureka Capital Partners.
    
    
      About the Transaction
    
    
      Under the terms of the Merger Agreement, NHHC shareholders will 
      receive either $11.35 or $11.50 in cash for each share of NHHC common 
      stock. If NHHC's earnings before interest, taxes, depreciation and 
      amortization (EBITDA), as calculated under the terms of the Merger 
      Agreement, for the four fiscal quarters ending prior to the closing is 
      at least $7.9 million, but less than $8.15 million, the price per share 
      will be $11.35 and if NHHC’s EBITDA 
      for such four fiscal quarters is at least $8.15 million, the price per 
      share will be $11.50.
    
    
      Frederick H. Fialkow, the Company's Chairman of the Board and beneficial 
      owner of approximately 35.9% of its outstanding shares of common 
      stock, has agreed to accept an 8% subordinated note of NHHC in exchange 
      for a portion of his common stock in the Company. The balance of his 
      shares will be paid for in cash at the cash price provided for in the 
      Merger Agreement.
    
    
      The Company's current chief executive officer, Steven Fialkow and its 
      current chief financial officer, Robert Heller will remain with the 
      Company and continue to serve in those positions under new five-year 
      employment agreements. Frederick H. Fialkow will provide strategic 
      advice to the Company under a five-year consulting agreement with the 
      Company.
    
    
      Steven Fialkow, President and Chief Executive Officer of NHHC, stated, 
      "Our management team is proud of what we have accomplished over the past 
      few years. We are also proud that organizations of the stature and 
      reputation of Angelo Gordon and Eureka Capital Partners have selected us 
      as a partner. I believe that Angelo Gordon and Eureka share our 
      commitment to providing the highest clinical care to our patients, and 
      to becoming an even more successful provider of home care."
    
    
      A special committee consisting of independent members of NHHC’s Board 
      of Directors unanimously recommended the transaction to the Board, and 
      the NHHC Board of Directors has unanimously approved the transaction. 
      Houlihan Lokey Howard & Zukin Financial Advisors, Inc. acted as a 
      financial advisor to the special committee with respect to the 
      transaction.
    
    
      The transaction, which is expected to close during NHHC's 
      fourth fiscal quarter ending July 31, 2007, is subject to the approval 
      by NHHC stockholders, regulatory approvals, NHHC having EBITDA for the 
      four fiscal quarters ending prior to the closing of at least $7.9 
      million and other customary closing considerations.
    
    
      Frederick H. Fialkow and Bernard Levine, M.D., also a director of NHHC, 
      who collectively beneficially own approximately 49.4% of the outstanding 
      shares, have agreed to vote their shares in favor of the Merger 
      Agreement, subject to the continued support of the merger by the Board 
      of Directors of NHHC in the exercise of its fiduciary duties.
    
    
      David Roberts, a senior managing director of Angelo, Gordon & 
      Co. stated, "We are excited to be partnering with Eureka Capital 
      Partners, Steven Fialkow, Bob Heller and the rest of the management team 
      at NHHC. We look forward to working with Eureka and the management 
      team to build upon the formidable business that they have developed."
    
    
      Stephen Greene, a managing director of Eureka Capital Partners stated, 
      "We have operated in the home healthcare sector for a long time and 
      can't think of a better management team than the team at NHHC to partner 
      with. Together with Angelo Gordon, we believe we have an ideal team."
    
    
      About Angelo, Gordon & Co.
    
    
      Angelo Gordon was founded in 1988 and currently has over 50 investment 
      professionals managing approximately $10 billion in capital across 
      multiple investment strategies. The New York-based long-term equity 
      strategy group currently manages more than $800 million in existing and 
      committed capital.
    
    
      About Eureka Capital Partners
    
    
      Eureka Capital is an independent financial advisory firm with offices in 
      New York, California and Wisconsin.
    
    
      Important Legal Information
    
    
      Stockholders are urged to read the proxy statement regarding the 
      proposed transaction when it becomes available, because it will contain 
      important information. Stockholders will be able to obtain a free copy 
      of the proxy statement as well as other filings containing information 
      about NHHC, without charge, at the SEC's Internet site (http://www.sec.gov). 
      Copies of the proxy statement and the filings with the SEC that will be 
      incorporated by reference in the proxy statement can also be obtained, 
      without charge, by directing a request to National Home Health Care 
      Corp., 700 White Plains Road, Scarsdale, New York 10583 Attention: 
      Robert Heller
    
    
      The directors and executive officers of NHHC and other persons may be 
      deemed to be participants in the solicitation of proxies in respect of 
      the proposed transaction. Information regarding NHHC directors and 
      executive officers is available in its proxy statement filed with the 
      SEC by NHHC on November 10, 2005. Other information regarding the 
      participants in the proxy solicitation and a description of their direct 
      and indirect interests, by security holdings or otherwise, will be 
      contained in the proxy statement and other relevant materials to be 
      filed with the SEC when they become available.
    
    
      Forward Looking Statements
    
    
      This press release contains forward-looking statements within the 
      meaning of the Private Securities Litigation Reform Act of 1995. Such 
      statements include, but are not limited to, statements about the 
      consummation of the merger, NHHC’s plans, 
      objectives, expectations and intentions and other statements that are 
      not historical facts. Such statements are based upon the current beliefs 
      and expectations of NHHC and are subject to significant risks and 
      uncertainties. Actual results may differ from those set forth in the 
      forward-looking statements. The following factors, among others, could 
      cause actual results to differ from those set forth in the 
      forward-looking statements: the ability to obtain governmental approvals 
      of the transaction on the proposed terms and schedule; the failure of 
      NHHC stockholders to approve the transaction; and the failure of NHHC to 
      satisfy the other conditions to closing, including the EBITDA condition 
      and the absence of a material adverse change in the business or 
      financial condition of NHHC. Additional factors that could cause NHHC's 
      results to differ materially from those described in the forward-looking 
      statements can be found in the 2006 Annual Report on Forms 10-K of NHHC 
      filed with the SEC and available at the SEC's Internet site (http://www.sec.gov).
    
  
Angelo, Gordon & Co. and National Home Health Care Corp. (National
Market: NHHC), a provider of home health care and staffing services in
the Northeast, today announced that NHHC and affiliates of Angelo
Gordon have entered into an Agreement providing for the merger of NHHC
with an affiliate of Angelo Gordon, in partnership with Eureka Capital
Partners.

   About the Transaction

   Under the terms of the Merger Agreement, NHHC shareholders will
receive either $11.35 or $11.50 in cash for each share of NHHC common
stock. If NHHC's earnings before interest, taxes, depreciation and
amortization (EBITDA), as calculated under the terms of the Merger
Agreement, for the four fiscal quarters ending prior to the closing is
at least $7.9 million, but less than $8.15 million, the price per
share will be $11.35 and if NHHC's EBITDA for such four fiscal
quarters is at least $8.15 million, the price per share will be
$11.50.

   Frederick H. Fialkow, the Company's Chairman of the Board
and beneficial owner of approximately 35.9% of its outstanding
shares of common stock, has agreed to accept an 8% subordinated note
of NHHC in exchange for a portion of his common stock in the
Company. The balance of his shares will be paid for in cash at the
cash price provided for in the Merger Agreement.

   The Company's current chief executive officer, Steven Fialkow and
its current chief financial officer, Robert Heller will remain with
the Company and continue to serve in those positions under new
five-year employment agreements. Frederick H. Fialkow will provide
strategic advice to the Company under a five-year consulting agreement
with the Company.

   Steven Fialkow, President and Chief Executive Officer of NHHC,
stated, "Our management team is proud of what we have accomplished
over the past few years. We are also proud that organizations of the
stature and reputation of Angelo Gordon and Eureka Capital Partners
have selected us as a partner. I believe that Angelo Gordon and
Eureka share our commitment to providing the highest clinical care to
our patients, and to becoming an even more successful provider of home
care."

   A special committee consisting of independent members
of NHHC's Board of Directors unanimously recommended the transaction
to the Board, and the NHHC Board of Directors has unanimously
approved the transaction. Houlihan Lokey Howard & Zukin Financial
Advisors, Inc. acted as a financial advisor to the special committee
with respect to the transaction.

   The transaction, which is expected to close during NHHC's
fourth fiscal quarter ending July 31, 2007, is subject to the approval
by NHHC stockholders, regulatory approvals, NHHC having EBITDA for the
four fiscal quarters ending prior to the closing of at least $7.9
million and other customary closing considerations.

   Frederick H. Fialkow and Bernard Levine, M.D., also a director of
NHHC, who collectively beneficially own approximately 49.4% of the
outstanding shares, have agreed to vote their shares in favor of
the Merger Agreement, subject to the continued support of the merger
by the Board of Directors of NHHC in the exercise of its fiduciary
duties.

   David Roberts, a senior managing director of Angelo, Gordon &
Co. stated, "We are excited to be partnering with Eureka Capital
Partners, Steven Fialkow, Bob Heller and the rest of the management
team at NHHC. We look forward to working with Eureka and the
management team to build upon the formidable business that they have
developed."

   Stephen Greene, a managing director of Eureka Capital Partners
stated, "We have operated in the home healthcare sector for a long
time and can't think of a better management team than the team at NHHC
to partner with. Together with Angelo Gordon, we believe we have an
ideal team."

   About Angelo, Gordon & Co.

   Angelo Gordon was founded in 1988 and currently has over 50
investment professionals managing approximately $10 billion in capital
across multiple investment strategies. The New York-based long-term
equity strategy group currently manages more than $800 million in
existing and committed capital.

   About Eureka Capital Partners

   Eureka Capital is an independent financial advisory firm with
offices in New York, California and Wisconsin.

   Important Legal Information

   Stockholders are urged to read the proxy statement regarding the
proposed transaction when it becomes available, because it will
contain important information. Stockholders will be able to obtain a
free copy of the proxy statement as well as other filings containing
information about NHHC, without charge, at the SEC's Internet site
(http://www.sec.gov). Copies of the proxy statement and the filings
with the SEC that will be incorporated by reference in the proxy
statement can also be obtained, without charge, by directing a request
to National Home Health Care Corp., 700 White Plains Road, Scarsdale,
New York 10583 Attention: Robert Heller

   The directors and executive officers of NHHC and other persons may
be deemed to be participants in the solicitation of proxies in respect
of the proposed transaction. Information regarding NHHC directors and
executive officers is available in its proxy statement filed with the
SEC by NHHC on November 10, 2005. Other information regarding the
participants in the proxy solicitation and a description of their
direct and indirect interests, by security holdings or otherwise, will
be contained in the proxy statement and other relevant materials to be
filed with the SEC when they become available.

   Forward Looking Statements

   This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. Such
statements include, but are not limited to, statements about the
consummation of the merger, NHHC's plans, objectives, expectations and
intentions and other statements that are not historical facts. Such
statements are based upon the current beliefs and expectations of
NHHC and are subject to significant risks and uncertainties. Actual
results may differ from those set forth in the forward-looking
statements. The following factors, among others, could cause actual
results to differ from those set forth in the forward-looking
statements: the ability to obtain governmental approvals of the
transaction on the proposed terms and schedule; the failure of NHHC
stockholders to approve the transaction; and the failure of NHHC to
satisfy the other conditions to closing, including the EBITDA
condition and the absence of a material adverse change in the business
or financial condition of NHHC. Additional factors that could cause
NHHC's results to differ materially from those described in the
forward-looking statements can be found in the 2006 Annual Report on
Forms 10-K of NHHC filed with the SEC and available at the SEC's
Internet site (http://www.sec.gov).