Graymark (GRMH) to Combine with Foundation Surgery Affiliates in $52.5M Deal
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Graymark Healthcare, Inc. (NASDAQ: GRMH), the nation's second largest provider of diagnostic sleep services and an innovator in comprehensive care for obstructive sleep apnea, has signed a non-binding letter of intent to combine with Foundation Surgery Affiliates, LLC and Foundation Surgical Hospital Affiliates, LLC, together known as Foundation Healthcare, in an all-stock transaction valued at $1.10 per common share. The aggregate transaction value is approximately $52.5 million.
At closing, Graymark will issue a combination of common stock and preferred stock to Foundation, as well as a separate series of preferred stock with a stated value of approximately $14 million. In addition, Graymark will issue warrants covering 4 million shares of its common stock exercisable at $1.50 per share. This is intended to reward Foundation to the extent that there is shareholder value driven by a substantial increase in the share price from current levels. Graymark Healthcare would be the surviving entity name upon the closing of the transaction, which is expected in the third quarter of 2012.
Graymark's board of directors has approved the combination which is subject to customary closing conditions, including the completion of due diligence, negotiation and execution of a definitive purchase agreement and consent of lenders.
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At closing, Graymark will issue a combination of common stock and preferred stock to Foundation, as well as a separate series of preferred stock with a stated value of approximately $14 million. In addition, Graymark will issue warrants covering 4 million shares of its common stock exercisable at $1.50 per share. This is intended to reward Foundation to the extent that there is shareholder value driven by a substantial increase in the share price from current levels. Graymark Healthcare would be the surviving entity name upon the closing of the transaction, which is expected in the third quarter of 2012.
Graymark's board of directors has approved the combination which is subject to customary closing conditions, including the completion of due diligence, negotiation and execution of a definitive purchase agreement and consent of lenders.
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