SOURCE: Union Dental Holdings, Inc.

February 20, 2007 07:30 ET

Union Dental Provides Shareholder Update; Sets Course for 2007

CORAL SPRINGS, FL -- (MARKET WIRE) -- February 20, 2007 -- Union Dental Holdings, Inc. (OTCBB: UDHI) -- http://www.uniondental.com/ir -- a national provider of a suite of dental services to union members and dentists, has released this update in an effort to provide its shareholders with greater understanding of its business plan and its corporate strategy over the coming year.

Union Dental consists of two primary businesses:

1. The Union Dental Network (the "Dental Network"). The Dental Network was an idea conceived by our CEO more than 20 years ago. The idea was simple: to provide union members with excellent dental care by networking large numbers of dentists in various locations all over the country. In order to execute on this idea, Union Dental would need to convince both unions and dentists to participate. Twenty years later, Union Dental has attracted the likes of the Communications Workers of America (CWA), the International Brotherhood of Electrical Workers (IBEW), the United Association of Plumbers and Pipe Fitters (UA) and The Association of Flight Attendants - Communications Workers of America (AFA-CWA). These groups comprise some of the largest unions in America. In terms of membership, our unions under contract number 120 of the 1,200 local CWA labor unions. The 120 local labor unions and their 120,000 members, together with their families, have dental services purchasing power in excess of $192,000,000 per year. CWA alone has approximately 3,200,000 insured offering much room for expansion.

As a result of the purchasing power of our union worker customers, we have been able to build networks of dentists all over America. Today, there are a total of 1,600 dental providers that participate in our Dental Network. Each dentist pays an annual fee of up to $5,000 in order to control "areas of exclusivity" for a particular group of union worker customers.

Union Dental believes that going forward, the Dental Network will be successful and grow as long as it can execute on a three-prong strategy.

--  First and foremost, Union Dental will continue to cherish its
    relationships with the unions in America and build additional relationships
    with local, regional and national unions.
    
--  The purchasing power of the Dental Network's union member customers
    will make it easier for Union Dental to execute on the second prong of the
    strategy -- to bring on additional dentists. Over the course of the next 12
    to 24 months, the Company hopes to add approximately 2,000 new dentists to
    the Dental Network.
    
--  The last part of the strategy is to cross sell our dentists and
    provide them with access to additional union worker customers by buying
    additional "areas of exclusivity." This is to say that when we already have
    an established network in a locale, and we add a new union for that same
    locale, approximately 90% percent of the existing dentists pay an
    additional fee to gain access to the new union worker customer base. The
    ability to attract new dentists to the Dental Network with relatively
    minimal marketing costs is very powerful.
    
2. Payment and Claims Adjudication Network ("PCAN"). Union Dental has, over the past several months, created a strategic alliance with Transax International. Our idea was to create a system where we would be able to go on-line and: (1) verify the benefits of the union member; (2) submit the claim; (3) get immediate real time adjudication; and (4) actually have a financial system in place to get the doctor a payment in 24-36 hours. All of this would be done on-line and in a real-time format. We believe that many doctors would pay a respectable fee to receive their money in 24 to 36 hours. Currently there is no company in the USA that can complete all four phases in a real-time on-line format.

This isn't traditional Account Receivable Financing (ARF). In ARF there are many charge backs, insurance company squabbles over procedures and costs from 12-18% for the services. In our PCAN concept, we have no charge backs because the claims have been adjudicated in real time; therefore, the doctor is guaranteed money from the insurance company. We place the financial institution in between at a cost of about 3-5% for the service to pay them in 24-36 hours. Everyone is happy and there are no charge backs.

In terms of the business opportunity, there are more than 200,000 dentists in the USA. We believe that over time we will be able to penetrate at least 5% of the overall number of dentists. If we are successful, this business, which complements our Dental Network, may be an even larger profit center than the Dental Network.

About Union Dental Holdings, Inc., Direct Dental Services, Inc. and Union Dental Corp.

Direct Dental Services and Union Dental Corp. are wholly owned subsidiaries. Direct Dental Services provides dentists with "areas of exclusivity" to participate with various unions including the Communications Workers of America (CWA) and the International Brotherhood of Electrical Workers (IBEW), United Association of Plumbers and Pipe Fitters (UA) and The Association of Flight Attendants - Communications Workers of America (AFA-CWA). Direct Dental Services receives annual management fees from the dentists in exchange for practicing in these "areas of exclusivity" where CWA and IBEW members use the dentists' services. Union Dental manages a dental practice in Coral Springs, Florida.

WEBSITE: www.afadental.com/ir www.uniondental.com/ir

"Safe-Harbor" Statement: Under the Private Securities Litigation Reform Act of 1995. This press release may contain forward-looking information within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), including all statements that are not statements of historical fact regarding the intent, belief or current expectations of the Company, its directors or its officers with respect to, among other things: (i) the Company's financing plans; (ii) trends affecting the Company's financial condition or results of operations; (iii) the Company's growth strategy and operating strategy; and (iv) the declaration and payment of dividends. The words "may," "would," "will," "expect," "estimate," "anticipate," "believe," "intend," and similar expressions and variations thereof are intended to identify forward-looking statements. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, many of which are beyond the Company's ability to control, and that actual results may differ materially from those projected in the forward-looking statements as a result of various factors.

Contact Information