iCoreConnect, a Cloud-Based SaaS Company Targeting the Healthcare Industry, Enters into Business Combination Agreement with FG Merger Corp.

iCoreConnect a SaaS company with an enterprise and healthcare workflow platform, and FG Merger Corp. a special purpose acquisition corporation, announced they have entered into a business combination agreement for a business combination that would result in iCoreConnect uplisting from the over the counter (“OTC”) market to the Nasdaq, and expecting to trade under the ticker “ICCT”.

“Additional Information and Where to Find It.”

iCoreConnect CEO Robert McDermott stated, “iCoreConnect is at the forefront of bringing workflow efficiencies to healthcare providers. Our solutions of 15 enterprise SaaS offerings have experienced significant subscription growth over the past several years, driven by our excellent sales team and the relationships we have cultivated with state associations and blue-chip names in the healthcare industry. We see continued demand for our products from large healthcare providers, hospitals, dental support organizations, and large insurance companies. We are laser focused on meeting this demand.”

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FGMC CEO Wes Schrader stated, “The FG Merger team is excited to announce this transaction with iCoreConnect. We see significant value in bringing technology workflow solutions to the dental and medical industry and we are particularly impressed with how Robert and the iCoreConnect team have positioned themselves within the industry.”

Larry Swets, Chairman of FGMC, added, “We are excited to provide iCoreConnect shareholders an opportunity to have their intrinsic value recognized while providing our shareholders a unique asymmetric opportunity to contribute to the growth capital of the combined company. Previously, these unique solutions to growth capital were only available to a select group of PIPE investors, we think all of our shareholders should have that opportunity.”

Key Takeaways

• iCoreConnect is positioned to take advantage of significant technology tailwinds driven by the healthcare industry shift from server to cloud environment and increasing mandated compliance at the state level for e-prescription as well as federal compliance with prescription drug monitoring programs
• 65% revenue CAGR since 2018, achieving estimated revenue of $8.1 million in 2022
• Agreements with state dental and medical associations that offer endorsements of iCoreConnect products has established a runway for future growth and created barriers to entry
• Scalable platform with 15 enterprise SaaS offerings and 28,000+ subscriptions
• System agnostic platform simplifies product adoption and integration with connections to major electronic health record systems and thousands of insurance plans
• Dental and medical total addressable market provides meaningful opportunity to grow market share
• Founder-led management team with track record of growth

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Transaction Overview

The transaction is expected to deliver up to $82.5 million of gross proceeds to the combined company from the FGMC trust account from its initial public offering in February 2022, assuming no redemptions. All references to available cash from the trust account and retained transaction proceeds are subject to any redemptions by the public stockholders of FGMC and payment of transaction expenses.

Existing FGMC shareholders who choose not to exercise their redemption rights in connection with the business combination will have 100% of their equity converted into preferred stock of the combined company. The preferred stock will have a 12% coupon payable in (a) cash or paid-in-kind for the first 24 months after the close of the transaction and (b) cash thereafter. The initial conversion price from common stock to preferred stock will be at a conversion price of $10.00 per share. A reset to the holder of $10 or 20% above the simple average volume weighted average price (VWAP) will occur 12 months after the closing of the transaction. The reset price can be no greater than $10.00 per share, and no less than $2.00 per share.

iCoreConnect common stockholders will receive common stock in the combined company.

The transaction has no minimum cash condition, however if the closing cash is less than $20,000,000 then the Sponsor will forfeit any and all dividends accrued on any shares of preferred stock owned by the Sponsor.

The transaction, which has been unanimously approved by FGMC’s board of directors and the members of iCoreConnect’s board, is expected to close in the second quarter of 2023, and is subject to approval by FGMC’s stockholders and iCoreConnect’s stockholders as well as other customary closing conditions.

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