Htetf (MM) (NASDAQ:HTRN)
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HealthTronics, Inc. (NASDAQ: HTRN) announced today that it has sent a
letter to the Endocare, Inc. (NASDAQ: ENDO) Board of Directors to
reaffirm its proposal to acquire all of the outstanding shares of
Endocare’s common stock for $2.28 per share.
In the letter, HealthTronics emphasized the resources it invests in
technologies that it endorses for use in its physician partnerships.
HealthTronics continually evaluates how the market might perceive the
longer term viability and financial backing of a technology it favors,
and HealthTronics is willing to take proactive measures to help support
the continued success of a technology as a prior alternative to
promoting a different technology.
HealthTronics also indicated its willingness to revise its proposal to
allow each of the Endocare shareholders to elect to receive either cash
or shares of HealthTronics common stock, provided that the total stock
portion of the purchase price does not exceed a negotiated percentage of
the total purchase price.
Commenting on the letter, James Whittenburg, President and Chief
Executive Officer of HealthTronics, stated: “HealthTronics
believes that the flexibility of our proposal in allowing Endocare
shareholders to receive stock consideration will provide an opportunity
for them to participate in the benefits of the combined company and a
stronger long-term investment.”
Below is the text of the letter that HealthTronics sent to Endocare’s
Board of Directors on September 3, 2008:
September 3, 2008
Board of Directors
Endocare, Inc.
201 Technology Drive
Irvine, CA 92618
Dear Members of the Board:
HealthTronics remains committed to its proposal to acquire all of the
outstanding shares of Endocare’s common stock
for $2.28 per share. We believe our firm proposal reflects a fair value
for Endocare. Endocare communicated in its August 13, 2008 press release
that its Board determined our proposal was inadequate. Despite our
attempts to engage Endocare in a dialogue regarding our proposal, there
has been no such dialogue. As a result, we are unclear as to why the
Endocare Board believes our proposal is inadequate and what
modifications to our proposal would, in the Board’s
view, make it adequate. While we believe our proposal reflects a fair
value for Endocare, we are willing to revise our proposal to allow each
of the Endocare shareholders to elect to receive either cash or shares
of HealthTronics common stock, with the stock portion of the
consideration not to exceed a negotiated percentage of the total
purchase price. This option to receive HealthTronics stock would enable
Endocare shareholders to participate in the value and growth of the
combined company.
HealthTronics continually strives to provide our urologist partners with
leading-edge technologies that enable them to provide high-quality
patient care. In so doing, we invest our time and resources to promote
technologies that we believe meet the high standards of our urologist
partners. When we promote the use of a particular technology, our
reputation is linked to that product and, by association, the company
that manufactures that product. For that reason, we are sensitive to
perceptions concerning the longer term viability and financial backing
of a technology we favor, and it is our first choice to proactively
support the continued success of such a technology before seeking to
replace that technology with one that is equally or more compelling.
Through our subsidiary, Advanced Medical Partners, Inc., we have
demonstrated a strong commitment to Endocare’s
technology and we believe that HealthTronics’
ownership of Endocare would maximize the value associated with the
technology. The HealthTronics platform offers several advantages,
including:
well established relationships with approximately one-third of the
practicing urologists in the United States;
demonstrated successful promotion of the Endocare technology; and
strong, positive cash flow and greater assurance of long-term
financial solvency.
We believe our proposal represents both immediate certainty of value in
a volatile stock market environment and a stronger long-term opportunity
for your shareholders.
Our proposal remains subject to the negotiation of a definitive merger
agreement and our having the opportunity to conduct certain limited and
confirmatory due diligence.
My leadership team and I will continue to make ourselves available to
meet with you to discuss all aspects of our proposal and answer any
questions you may have at your earliest convenience.
We very much look forward to your prompt reply.
Very truly yours,
/s/ James S. B Whittenburg
James S. B Whittenburg
President and Chief Executive Officer
About HealthTronics, Inc.
HealthTronics is a premier urology company providing an exclusive suite
of healthcare services and technology including urologist partnership
opportunities, surgical and capital equipment, maintenance services
offerings, and anatomical pathology services. For more information,
visit www.healthtronics.com.
Additional Information and Forward Looking Statements
Statements by the Company's management in this press release that are
not strictly historical, including statements regarding plans,
objectives and future financial performance, are "forward-looking"
statements that are made pursuant to the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. In particular,
statements in this press release regarding future outlook or future
revenue growth are forward-looking statements. Although HealthTronics
believes that the expectations reflected in the forward-looking
statements in this press release are reasonable, no assurance can be
given that the expectations will prove to be correct. Factors that could
cause actual results to differ materially from HealthTronics'
expectations include, among other things, HealthTronics’
ability to achieve the synergies and value creation contemplated by the
proposed transaction, HealthTronics’ ability
to timely and effectively integrate the business of Endocare, the timing
to consummate the proposed transaction, the timing of obtaining and any
necessary actions to obtain regulatory and other approvals, the
existence of demand for and acceptance of HealthTronics' products and
services, maintaining relationships with physicians and hospitals,
governmental regulations and changes thereto, regulatory approvals,
economic conditions, the impact of competition and pricing, successful
integration of acquired businesses, financing efforts and other factors
described from time to time in HealthTronics' periodic filings with the
Securities and Exchange Commission.
The statements in this press release are made as of the date of this
press release, even if the press release is subsequently made available
by the Company on its web site or otherwise. The Company does not assume
any obligation to update the forward-looking statements provided herein
to reflect events that occur or circumstances that exist after the date
hereof.
This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of any
vote or approval. In connection with the proposed transaction,
HealthTronics, Inc. plans to file with the SEC a registration statement
on Form S-4 containing a prospectus and other documents regarding the
proposed transaction. The prospectus will be mailed to stockholders of
Endocare, Inc. INVESTORS AND SECURITY HOLDERS OF ENDOCARE, INC. ARE
URGED TO READ THE PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE SEC
CAREFULLY IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.
Investors and security holders will be able to obtain free copies of the
registration statement and the prospectus (when available) and other
documents filed with the SEC by HealthTronics, Inc. through the website
maintained by the SEC at http://www.sec.gov.
Free copies of the registration statement and the prospectus (when
available) and other documents filed with the SEC can also be obtained
by directing a request to Ross A. Goolsby, HealthTronics, Inc., 1301
Capital of Texas Highway, Suite 200B, Austin, Texas 78746.