Law Offices of Howard G. Smith announces that it is investigating potential claims against the board of directors of Health Grades, Inc. (“Health Grades” or the “Company”) (NASDAQ:HGRD) related to the Company’s agreement to be acquired by private equity firm Vestar Capital Partners V, L.P. (“Vestar”). The proposed all-cash transaction is valued at approximately $294 million.

Under the terms of the definitive agreement entered into by the parties, a subsidiary of Vestar will commence a tender offer no later than August 10, 2010, to acquire all of the outstanding shares of Health Grades for $8.20 per share in cash. Certain executive officers of Health Grades beneficially owning approximately 21% of Health Grades’ fully diluted shares have entered into agreements to support the transaction and to tender or otherwise sell shares to Vestar’s affiliate. Upon completion of the tender offer, the affiliate of Vestar will acquire all of the remaining publicly held shares of Health Grades at $8.20 per share through a second-step merger. The investigation concerns possible breaches of fiduciary duty and other violations of law related to approval of the proposed transaction by Health Grades’ board of directors.

If you own shares of Health Grades, if you have information or would like to learn more about these claims, or if you wish to discuss these matters or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Howard G. Smith, Esquire, of Law Offices of Howard G. Smith, 3070 Bristol Pike, Suite 112, Bensalem, Pennsylvania 19020 by telephone at (215) 638-4847, Toll Free at (888) 638-4847, or by email to howardsmith@howardsmithlaw.com, or visit our website at http://www.howardsmithlaw.com.

Law Offices of Howard G. Smith
Howard G. Smith, Esquire
(215) 638-4847
(888) 638-4847
howardsmith@howardsmithlaw.com
www.howardsmithlaw.com