Novation Companies, Inc. (OTCPK:NOVC.Q) entered into a stock purchase agreement to acquire Healthcare Staffing, Inc. from Butler America, Inc. for $24 million.

Novation Companies, Inc. (OTCPK:NOVC.Q) entered into a stock purchase agreement to acquire Healthcare Staffing, Inc. from Butler America, Inc. for $24 million in cash on February 1, 2017. As part of consideration, Novation agreed to deposit $0.24 million of the purchase price in escrow at closing for a period of six months to secure Butler’s indemnification obligations under the agreement. Novation Companies agreed to deposit $0.1 million in escrow prior to closing, to be available to reimburse Butler for its reasonable and documented legal fees and expenses up to $0.1 million in the event of termination. As part of consideration, Novation will also pay for the debt of Healthcare Staffing. Novation Companies and Healthcare Staffing signed a confidentiality agreement on September 7, 2016. The deal is subject to a potential working capital adjustment. The deal is subject to employment agreement, bankruptcy court approval, governmental regulatory agencies approval and consummation of due diligence. Adam W. Finerman of Olshan Frome Wolosky LLP acted as legal advisor for Novation Companies. Stephen A. Opler of Barnes & Thornburg LLP acted as legal advisor for Butler America. Wells Fargo Bank, National Association acted as escrow agent in the transaction. Oberon Securities, LLC acted as broker for Butler America.