HealthTronics Reaffirms Bid for Endocare
September 03 2008 - 5:28PM
Business Wire
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.
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