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Archive for the ‘National Venture Capital Association’ Category

Update to the Bidding Process – Procedures for the sale of certain assets of InnerPulse, Inc.

Further to Gerbsman Partners e-mail of February 23, 2011 and February 14, 2011 regarding the sale of certain assets of InnerPulse, Inc., I attach the legal documents and wire transfer information that we will be requesting of bidders for certain assets of InnerPulse, Inc.  All parties bidding on the assets are encouraged, to the greatest extent possible, to conform the terms of their bids to the terms and form of the attached agreements.  Any and all of the assets of InnerPulse, Inc. will be sold on an “as is, where is” basis.  I would also encourage all interested parties to have their counsel speak with Fred D. Hutchison, Esq., counsel to InnerPulse, Inc.

The refundable deposit/wire transfer, will be held in the trust account at Hutchison Law Group and will be refunded back to interested parties that are not chosen as the winning bidder.

For additional information please contact Fred D. Hutchison Esq., of Hutchison Law Group, counsel to InnerPulse, Inc.  He can be reached at 919 829 4300  and/or   fhutchison@hutchlaw.com

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the InnerPulse Assets. Sealed bids must be submitted so that the bid is actually received by Gerbsman Partners no later than March 18, 2011 at 3:00 p.m. Eastern Standard Time (the “Bid Deadline”) at InnerPulse’s office, located at 4025 Stirrup Creek Drive, #200, Research Triangle Park, NC 27703.  Please also email steve@gerbsmanpartners.com with any bid.

For your convenience, I have restated the description of the Updated Bidding Process.

The key dates and terms include:

The Bidding Process for Interested Buyers

Interested and qualified parties will be expected to sign a nondisclosure agreement (attached hereto as Exhibit A) to have access to key members of the management and intellectual capital teams and the due diligence “war room” documentation (the “Due Diligence Access”).  Each interested party, as a consequence of the Due Diligence Access granted to it, shall be deemed to acknowledge and represent (i) that it is bound by the bidding procedures described herein; (ii) that it has an opportunity to inspect and examine the InnerPulse Assets and to review all pertinent documents and information with respect thereto; (iii) that it is not relying upon any written or oral statements, representations, or warranties of InnerPulse, Inc., Gerbsman Partners, or their respective staff, agents, or attorneys; and (iv) all such documents and reports have been provided solely for the convenience of the interested party, and neither InnerPulse nor Gerbsman Partners (or their respective, staff, agents, or attorneys) makes any representations as to the accuracy or completeness of the same.

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the InnerPulse Assets.  Sealed bids must be submitted so that the bid is actually received by Gerbsman Partners no later than March 18, 2011 at 3:00 p.m. Eastern Standard Time (the “Bid Deadline”) at InnerPulse’s office, located at 4025 Stirrup Creek Drive, #200, Research Triangle Park, NC 27703.  Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in a specific and identifiable way.  The attached InnerPulse fixed asset list may not be complete and Bidders interested in the InnerPulse Assets must submit a separate bid for such assets.  Be specific as to the assets desired.

Any person or other entity making a bid must be prepared to provide independent confirmation that they possess the financial resources to complete the purchase where applicable.  All bids must be accompanied by a refundable deposit check in the amount of $200,000 (payable to InnerPulse, Inc.).  The winning bidder will be notified within 3 business days after the Bid Deadline.  Non-successful bidders will have their deposit returned to them.

InnerPulse reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.  Interested parties should understand that it is expected that the highest bid will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission.

InnerPulse will require the successful bidder to close within 7 business days.  Any or all of the assets of InnerPulse will be sold on an “as is, where is” basis, with no representation or warranties whatsoever.

All sales, transfer, and recording taxes, stamp taxes, or similar taxes, if any, relating to the sale of the InnerPulse Assets shall be the sole responsibility of the successful bidder and shall be paid to InnerPulse at the closing of each transaction.

For additional information, please see below and/or contact:

Fred D. Hutchison, Esq.
(919) 829-4300
fhutchison@hutchlaw.com

Steven R. Gerbsman
(415) 456-0628
steve@gerbsmanpartners.com

Kenneth Hardesty
(408) 591-7528
ken@gerbsmanpartners.com

Jim Skelton
(949) 466-7303
jim@gerbsmanpartners.com

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San Francisco, February, 2011

Successful “Date Certain M&A” of Medical Device companies, its Assets and Intellectual Property

Steven R. Gerbsman, Principal of Gerbsman Partners, Kenneth Hardesty, James Skelton, James McHugh and Dennis Sholl, members of Gerbsman Partners Board of Intellectual Capital, announced today their success in maximizing stakeholder value for two venture capital backed, medical device companies. These companies were in the obesity and cardiac mitral regurgitation spaces.

Gerbsman Partners provided Crisis Management and Investment Banking leadership, facilitated the sale of the business unit’s assets and its associated Intellectual Property. Due to market conditions, the board of directors made the strategic decision to maximize the value of the business unit and Intellectual Property. Gerbsman Partners provided leadership to the company with:

1,  Crisis Management and medical device domain expertise in developing the strategic action plans for maximizing value of the business unit, Intellectual Property and assets;
2.  Proven domain expertise in maximizing the value of the business unit and Intellectual Property through a Gerbsman Partners targeted and proprietary “Date Certain M&A Process”;
3.  The ability to “Manage the Process” among potential Acquirers, Lawyers, Creditors Management and Advisors;
4.  The proven ability to “Drive” toward successful closure for all parties at interest.

About Gerbsman Partners

Gerbsman Partners focuses on maximizing enterprise value for stakeholders and shareholders in under-performing, under-capitalized and under-valued companies and their Intellectual Property. Since 2001, Gerbsman Partners has been involved in maximizing value for 67 Technology, Life Science and Medical Device companies and their Intellectual Property and has restructured/terminated over $795 million of real estate executory contracts and equipment lease/sub-debt obligations. Since inception in 1980, Gerbsman Partners has been involved in over $2.3 billion of financings, restructurings and M&A transactions.

Gerbsman Partners has offices and strategic alliances in San Francisco, Boston, New York, Washington, DC, Alexandria, VA, Europe and Israel.

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Sale of InnerPulse, Inc.

Gerbsman Partners (www.gerbsmanpartners.com) has been retained by InnerPulse, Inc. (www.innerpulse.com) to solicit interest for the acquisition of all, or substantially all, the assets of InnerPulse, Inc.

Headquartered in Research Triangle Park, North Carolina, InnerPulse, Inc. is a cardiac rhythm management (CRM) medical device company founded in 2003 with disruptive technology which will likely change the industry by creating unique access to and delivering new growth in the existing $12 billion worldwide CRM market.

InnerPulse has raised three rounds of private financing to date totaling $85 million from both venture capital and strategic partners.  Investors have included Delphi Ventures, Frazier Healthcare Ventures, Synergy Life Science Partners, Ascent Biomedical Ventures, as well as strategic investments from Boston Scientific, Johnson & Johnson Development Corp., and Medtronic.

IMPORTANT LEGAL NOTICE:

The information in this memorandum does not constitute the whole or any part of an offer or a contract.

The information contained in this memorandum relating to InnerPulse’s Assets has been supplied by InnerPulse.  It has not been independently investigated or verified by Gerbsman Partners or its agents.

Potential purchasers should not rely on any information contained in this memorandum or provided by InnerPulse, or Gerbsman Partners (or their respective staff, agents, and attorneys) in connection herewith, whether transmitted orally or in writing as a statement, opinion, or representation of fact. Interested parties should satisfy themselves through independent investigations as they or their legal and financial advisors see fit.

InnerPulse, Gerbsman Partners, and their respective staff, agents, and attorneys, (i) disclaim any and all implied warranties concerning the truth, accuracy, and completeness of any information provided in connection herewith and (ii) do not accept liability for the information, including that contained in this memorandum, whether that liability arises by reasons of InnerPulse’s or Gerbsman Partners’ negligence or otherwise.

Any sale of the InnerPulse Assets will be made on an “as-is,” “where-is,” and “with all faults” basis, without any warranties, representations, or guarantees, either express or implied, of any kind, nature, or type whatsoever from, or on behalf of InnerPulse or Gerbsman Partners.  Without limiting the generality of the foregoing, InnerPulse and Gerbsman Partners and their respective staff, agents, and attorneys,  hereby expressly disclaim any and all implied warranties concerning the condition of the InnerPulse Assets and any portions thereof, including, but not limited to, environmental conditions, compliance with any government regulations or requirements, the implied warranties of habitability, merchantability, or fitness for a particular purpose.

This memorandum contains confidential information and is not to be supplied to any person without Gerbsman Partners’ prior consent.  This memorandum and the information contained herein are subject to the non-disclosure agreement attached hereto as Exhibit A.

InnerPulse has developed and patented a novel device platform technology, the fully intravascular implantable device (IID) that is extensible into all of CRM—single and dual chamber pacemakers, single and dual chamber defibrillators, and cardiac resynchronization therapy defibrillators.  The platform is built upon industry-proven technology, yet innovated to allow physicians to implant devices via a standard percutaneous procedure rather than the traditional surgical technique.  This dramatic change will simplify the implant for the physician and improve therapy access and outcomes for the patient.

InnerPulse believes its assets are attractive for a number of reasons

1.  The InnerPulse fully intravascular, percutaneously implanted IID technology is revolutionary and disruptive, and can provide both market growth and market share in the large, $12 billion worldwide CRM market.

2.  The InnerPulse novel form factor and intravascular implant location provide significant benefits over traditional CRM devices, yet utilize well-established, proven methods and therapy for pacing and defibrillation, with clinical evidence already existent, reimbursement in place, and clinical practice guidelines well-known.

3.  InnerPulse’s Intellectual Property, comprising 7 issued US patents, 22 pending US patent applications, 2 issued international patents and 5 international pending patent applications, is the exclusive portfolio for the practice of fully intravascular implantable electrophysiological devices.

4.  The company has significantly de-risked the technology by completing over 400 animal studies and an acute human study, demonstrating safety and efficacy of the technology to the fullest extent prior to chronic human clinical trials.

5.  This unprecedented set of animal data, including peer-reviewed and published studies, is also augmented by an acute defibrillation threshold (DFT) human trial that demonstrated better defibrillation efficacy than traditional defibrillators and validated the implant procedure.

6.  InnerPulse has developed a comprehensive strategic product plan with enabling technology pathways to enable the platform into all CRM products.

7.  InnerPulse has developed the basic manufacturing processes required for its novel technology and has produced its percutaneous implantable cardioverter defibrillator (PICD™).

8.  The world’s thought leaders in both electrophysiology and interventional cardiology have actively supported and advised the company since its inception.

9.  The company has developed excellent relationships with several leading European cardiology centers that have participated in the Company’s acute human study and have indicated they will participate in its CE Mark trial.

InnerPulse Company Profile

InnerPulse, Inc. is located in Research Triangle Park, NC, and is a privately held company founded in December 2003.  InnerPulse has raised three rounds of private financing to date totaling $85 million from both venture capital and strategic partners.  Investors have included Delphi Ventures, Frazier Healthcare Ventures, Synergy Life Science Partners, Ascent Biomedical Ventures, as well as strategic investments from Boston Scientific, Johnson & Johnson Development Corp., and Medtronic.

The company has developed and manufactured the revolutionary IID platform technology, as well as developed percutaneous implant and removal procedures using custom catheter-based tools.  The InnerPulse intravascular platform has been developed and evaluated extensively in over 400 animals to date, as well as with thorough bench and laboratory testing.  Chronic safety has been demonstrated in animal studies over 1 year, and the Company has conducted acute human studies on the platform and procedure.

Impact of Technology on the Market

The percutaneously-implanted IID will compete in, and dramatically impact, the existing CRM market.  InnerPulse will market both pacemaker and defibrillator product lines.  With respect to the existing CRM devices on the market today, the InnerPulse devices are superior.  The benefits include a simpler and faster procedure, reduced complications, device reliability advantages, and lower post-procedure discomfort.

Unlike current CRM devices, which are surgically implanted in a procedure that typically takes 35 minutes and requires an operating room, the InnerPulse fully intravascular pacemaker (PPx™) and defibrillator (PICD™) technology are implanted percutaneously utilizing a catheter-based procedure, which takes less than 15 minutes and can be performed in the cardiac catheterization laboratory.  Additionally, the implant procedure is familiar to both electrophysiologists (who currently implant the majority of CRM devices) and other implanting cardiologists, and has significantly lower infection rates than surgical procedures.  The intravascular device is also projected to deliver reliability advantages, including the virtual elimination of performance issues associated with cardiac leads and device headers.  Because the IID does not require a surgical pocket, patients benefit through lower post-procedure discomfort and improved cosmesis.  In the end, the device is imperceptible to the patient and will address known barriers to patient acceptance of an implanted device.  The shortened procedure and improved cost efficiency of the cardiac catheterization lab will increase hospital and physician revenue by facilitating more procedures at higher margin.

Together, the benefits provided by the InnerPulse technology will appeal to all stakeholders—physicians, patients and hospitals, and will drive market acceptance.

InnerPulse’s Assets

InnerPulse has developed a portfolio of assets critical to the development and manufacture of its revolutionary, fully intravascular cardiac rhythm management device technology. These assets fall into a variety of categories, including:

–   Patents, Patent Applications and Trademarks

–   Significant intellectual capital, know-how and expertise in the design and manufacture of fully intravascular systems and the novel percutaneous implant and removal procedure

–   Long-term strategic Product Plan including next generation product designs

–   Design and quality assurance test equipment

–   Fully-outfitted manufacturing equipment for the PICD™, the company’s fully intravascular implantable defibrillator

–   Pre-clinical animal data including the following:
–  Data from over 400 development animal studies
–  Peer-reviewed, published animal data demonstrating superior defibrillation efficacy in porcine and canine
–  Completed GLP studies on anchoring stability and vascular response
–  A cohort of survival animals implanted over 1 year targeted for long-term removals required for regulatory submission

–   Clinical data from the acute DFT human study

The assets of InnerPulse will be sold in whole or in part (collectively, the “InnerPulse Assets”). The sale of these assets is being conducted with the cooperation of InnerPulse.  InnerPulse and its employees will be available to assist purchasers with due diligence and a prompt, efficient transition to new ownership.  Notwithstanding the foregoing, InnerPulse should not be contacted directly without the prior consent of Gerbsman Partners.

The Sale of the InnerPulse Assets is being conducted pursuant to a Resolution of the Board of Directors of InnerPulse, Inc. for the liquidation and dissolution of the company which was approved by the Board on February 3, 2011, and by the stockholders on February 7, 2011.  InnerPulse expects the sale of the InnerPulse Assets to be completed without any further vote or action by InnerPulse’s stockholders.

InnerPulse, Inc. Key Personnel
·       Stephen C. Masson — General Manager & Chief Technology Officer:  Has led the Company’s product development, product planning, operations, and relationships with key technology and funding partners, and consultants.  Mr. Masson draws from 30 years experience in the design and manufacture of implantable medical devices, including pacemakers and defibrillators.  Formerly Vice President of Product Development at Ventritex. Inc. (now a division of St. Jude Medical), where Mr. Masson was responsible for overseeing the team that created a series of highly advanced implantable cardiac devices, resulting in the company attaining as much as a 35-percent U.S. market share and more than $125 million in annual revenue.  Previously, Mr. Masson was Vice President of Research and Development at HeartWare, Inc., a cardiac-assist device company, and began his career in at pacemaker manufacturer Cordis Corporation (now a division of Johnson & Johnson), where he held both design and management roles.
·       Terry Ransbury — Vice President, Research & Development, Co-founder: The Company’s first employee, Mr. Ransbury has played a critical role in developing the company’s novel technology and intellectual property, including filing the patents for the platform technology and implantation techniques of the intravascular device.  Mr. Ransbury has more than 25 years of management, product development and field experience in the medical device industry to his position.  He was the principal designer of the medical instrumentation device for programming implantable defibrillators at Ventritex, Inc. As Clinical Manager at Biosense, he oversaw the field introduction of the industry-standard CARTO 3D electrophysiological mapping and ablation system.  Each company was acquired for more than $350 million during his tenure.
·       W. Eugene Sanders, MD — Vice President, Medical Affairs & Chief Medical Officer: Dr. Sanders has led the company’s medical affairs including clinical support of product and procedure development and management of the animal and early human clinical studies.  Dr. Sanders joined the company after spending 15 years at the University of North Carolina-Chapel Hill as Director of Clinical Cardiac Electrophysiology.  He has extensive experience in surgical implantation of defibrillators and pacemakers, as well as all aspects of arrhythmia management including ablation.  Dr. Sanders has been a major investigator in multiple national clinical trials of implantable medical devices. His publications include articles in the New England Journal of Medicine, Journal of the American College of Cardiology, and Lancet in addition to several book chapters.  He is board certified in Internal Medicine, Cardiovascular Disease, and Clinical Cardiac Electrophysiology.
·       Julie Ames — Controller:  Ms. Ames has over 25 years experience at the Controller level in corporate accounting and management.  She has a broad background in all aspects of company operations including finance, budgeting and forecasting, cost controls, human resources, insurance, IT, staff management and corporate governance.

InnerPulse, Inc. Board of Directors

·       John F. Maroney: Delphi Ventures – Menlo Park, CA
·       Nathan R. Every, MD: Frazier Healthcare Ventures – Seattle, WA

The Bidding Process for Interested Buyers

Interested and qualified parties will be expected to sign a nondisclosure agreement (attached hereto as Exhibit A) to have access to key members of the management and intellectual capital teams and the due diligence “war room” documentation (the “Due Diligence Access”).  Each interested party, as a consequence of the Due Diligence Access granted to it, shall be deemed to acknowledge and represent (i) that it is bound by the bidding procedures described herein; (ii) that it has an opportunity to inspect and examine the InnerPulse Assets and to review all pertinent documents and information with respect thereto; (iii) that it is not relying upon any written or oral statements, representations, or warranties of InnerPulse, Inc., Gerbsman Partners, or their respective staff, agents, or attorneys; and (iv) all such documents and reports have been provided solely for the convenience of the interested party, and neither InnerPulse nor Gerbsman Partners (or their respective, staff, agents, or attorneys) makes any representations as to the accuracy or completeness of the same.

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the InnerPulse Assets.  Sealed bids must be submitted so that the bid is actually received by Gerbsman Partners no later than March 18, 2011 at 3:00 p.m. Eastern Standard Time (the “Bid Deadline”) at InnerPulse’s office, located at 4025 Stirrup Creek Drive, #200, Research Triangle Park, NC 27703.  Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in a specific and identifiable way.  The attached InnerPulse fixed asset list may not be complete and Bidders interested in the InnerPulse Assets must submit a separate bid for such assets.  Be specific as to the assets desired.

Any person or other entity making a bid must be prepared to provide independent confirmation that they possess the financial resources to complete the purchase where applicable.  All bids must be accompanied by a refundable deposit check in the amount of $200,000 (payable to InnerPulse, Inc.).  The winning bidder will be notified within 3 business days after the Bid Deadline.  Non-successful bidders will have their deposit returned to them.

InnerPulse reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.  Interested parties should understand that it is expected that the highest bid will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission.

InnerPulse will require the successful bidder to close within 7 business days.  Any or all of the assets of InnerPulse will be sold on an “as is, where is” basis, with no representation or warranties whatsoever.

All sales, transfer, and recording taxes, stamp taxes, or similar taxes, if any, relating to the sale of the InnerPulse Assets shall be the sole responsibility of the successful bidder and shall be paid to InnerPulse at the closing of each transaction.

For additional information, please see below and/or contact:

Steven R. Gerbsman
(415) 456-0628
steve@gerbsmanpartners.com

Kenneth Hardesty
(408) 591-7528
ken@gerbsmanpartners.com

Jim Skelton
(949) 466-7303
jim@gerbsmanpartners.com

Read Full Post »

Bidding Process – Procedures for the sale of certain Assets and Intellectual Property of Satiety, Inc.

Further to Gerbsman Partners e-mail of January 3, 2011 regarding the sale of certain assets of Satiety, Inc., I attach the legal documents that we will be requesting of bidders for certain assets of Satiety, Inc.  All parties bidding on the assets are encouraged, to the greatest extent possible, to conform the terms of their bids to the terms and form of the attached agreements.  Any and all of the assets of Satiety, Inc. will be sold on an “as is, where is” basis.  I would also encourage all interested parties to have their counsel speak with Stephen O’Neill, Esq., counsel to Satiety, Inc.

The sale is being conducted with the cooperation of Satiety, Inc. and Satiety, Inc. will use its best efforts to make its employees available to assist purchasers with due diligence and assist with a prompt and efficient transition at mutually convenient time.

For additional information please contact Stephen O’Neill, Esq., of Murray & Murray counsel to Satiety, Inc.  He can be reached at 408-907-9200  and/or at soneill@murraylaw.com

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the Satiety Assets.  Sealed bids must be submitted so that they are actually received by Gerbsman Partners no later than Friday, February 4, 2011 at 3:00 p.m. Pacific Time (the “Bid Deadline”) at Satiety’s office, located at 2470 Embarcadaro Way, Palo Alto, California 94303.  Please also email steve@gerbsmanpartners.com with any bid.

For your convenience, I have restated the description of the Updated Bidding Process.

The key dates and terms include:

The Bidding Process for Interested Buyers

Interested and qualified parties will be expected to sign a nondisclosure agreement (attached hereto as Exhibit A) to have access to key members of the management and intellectual capital teams and the due diligence “war room” documentation (the “Due Diligence Access”). Each interested party, as a consequence of the Due Diligence Access granted to it, shall be deemed to acknowledge and represent (i) that it is bound by the bidding procedures described herein; (ii) that it has an opportunity to inspect and examine the Satiety Assets and to review all pertinent documents and information with respect thereto; (iii) that it is not relying upon any written or oral statements, representations, or warranties of Gerbsman Partners, or their respective staff, agents, or attorneys; and (iv) all such documents and reports have been provided solely for the convenience of the interested party, and Gerbsman Partners (and their respective, staff, agents, or attorneys) do not make any representations as to the accuracy or completeness of the same.

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the Satiety Assets. Sealed bids must be submitted so that it is actually received by Gerbsman Partners no later than Friday, February 4th, 2011 at 3:00 p.m. Pacific Standard Time (the “Bid Deadline”) at Satiety’s office, located at 2470 Embarcadero Way, Palo Alto, CA 94303.  Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in a specific and identifiable way. The attached Satiety list (Exhibit “B”) may not be complete and Bidders interested in the Satiety Equipment must submit a separate bid for such assets. Be specific as to the assets desired.

Any person or other entity making a bid must be prepared to provide independent confirmation that they possess the financial resources to complete the purchase where applicable. All bids must be accompanied by a refundable deposit check in the amount of $200,000 (payable to Satiety, Inc.). The winning bidder will be notified within 48 hours of the Bid Deadline. Non-successful bidders will have their deposit returned to them. Satiety reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.

Satiety reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.  Interested parties should understand that it is expected that the highest bid submitted will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission.

Satiety will require the successful bidder to close within a 7 to 14 day period. Any or all of the assets of Satiety will be sold on an “as is, where is” basis, with no representation or warranties whatsoever.

All sales, transfer, and recording taxes, stamp taxes, or similar taxes, if any, relating to the sale of the Satiety Assets shall be the sole responsibility of the successful bidder and shall be paid to Satiety at the closing of each transaction.

For additional information, please see below and/or contact:

Stephen O’Neill, Esq.
Murray & Murray
(408) 907-9200
soneill@murraylaw.com

Steven R. Gerbsman
(415) 456-0628
steve@gerbsmanpartners.com

Kenneth Hardesty
(408) 591-7528
ken@gerbsmanpartners.com

James Skelton
(949) 466-7303
jim@gerbsmanpartners.com

Read Full Post »

VIACOR, Inc. – 1/10/11 Update to the Bidding Process – Procedures for the sale of certain assets and Intellectual Property

Further to Gerbsman Partners e-mail of December 31, 2010 and  December 16, 2010 regarding the sale of certain assets of VIACOR, Inc., I attach the legal documents and wire transfer information  that we will be requesting of bidders for certain assets of VIACOR, Inc.  All parties bidding on the assets are encouraged, to the greatest extent possible, to conform the terms of their bids to the terms and form of the attached agreements.  Any and all of the assets of VIACOR, Inc. will be sold on an “as is, where is” basis.  I would also encourage all interested parties to have their counsel speak with Stephen O’Neill, Esq., counsel to VIACOR, Inc. prior to the bid date, to review the asset purchase agreement.

For additional information please contact Stephen O’Neill, Esq., of Murray & Murray counsel to VIACOR, Inc. He can be reached at 408 907 9200  and/or at soneill@murraylaw.com

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the VIACOR Assets. Sealed bids must be submitted so that the bid is actually received by Gerbsman Partners no later than Friday, January 21, 2011 at 3:00 p.m. Pacific Standard Time (the “Bid Deadline”) at VIACORS’ office, located at 260-B Fordham Road, Wilmington, MA, 01887.    Please also email steve@gerbsmanpartners.com with any bid.

For your convenience, I have restated the description of the Updated Bidding Process.

The key dates and terms include:
The Bidding Process for Interested Buyers

Interested and qualified parties will be expected to sign a nondisclosure agreement (attached hereto as Exhibit A) to have access to key members of the management and intellectual capital teams and the due diligence “war room” documentation (the “Due Diligence Access”). Each interested party, as a consequence of the Due Diligence Access granted to it, shall be deemed to acknowledge and represent (i) that it is bound by the bidding procedures described herein; (ii) that it has an opportunity to inspect and examine the VIACOR Assets and to review all pertinent documents and information with respect thereto; (iii) that it is not relying upon any written or oral statements, representations, or warranties of VIACOR, Inc., Gerbsman Partners, or their respective staff, agents, or attorneys; and (iv) all such documents and reports have been provided solely for the convenience of the interested party, and neither VIACOR nor Gerbsman Partners (or their respective, staff, agents, or attorneys) makes any representations as to the accuracy or completeness of the same.

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the VIACOR Assets. Sealed bids must be submitted so that the bid is actually received by Gerbsman Partners no later than Friday, January 21, 2011 at 3:00 p.m. Eastern Standard Time (the “Bid Deadline”) at VIACOR’ office, located at 260-B Fordham Road, Wilmington, MA, 01887.  Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in a specific and identifiable way. The attached VIACOR fixed asset list may not be complete and Bidders interested in the VIACOR Assets must submit a separate bid for such assets. Be specific as to the assets desired.

Any person or other entity making a bid must be prepared to provide independent confirmation that they possess the financial resources to complete the purchase where applicable. All bids must be accompanied by a refundable deposit check in the amount of $250,000 (payable to VIACOR, Inc.). The winning bidder will be notified within 3 business days after the Bid Deadline. Unsuccessful bidders will have their deposit returned to them.

VIACOR reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.  Interested parties should understand that it is expected that the highest bid submitted will be chosen as the winningbidder and bidders may not have the opportunity to improve their bids aftersubmission.

VIACOR will require the successful bidder to close within 7 business days.  Any or all of the assets of VIACOR will be sold on an “as is, where is” basis, with no representation or warranties whatsoever.  Please note that VIACOR is selling its assets in cooperation with its senior secured creditor.

All sales, transfer, and recording taxes, stamp taxes, or similar taxes, if any, relating to the sale of the VIACOR Assets shall be the sole responsibility of the successful bidder and shall be paid to VIACOR at the closing of each transaction.

For additional information, please see below and/or contact:

Stephen O’Neill, Esq
(408) 907-9200
soneill@murraylaw.com

Steven R. Gerbsman
(415) 456-0628
steve@gerbsmanpartners.com

James McHugh
(978) 2397296
jim@mchughco.com

Dennis Sholl
(415) 457-9596
dennis@gerbsmanpartners.com

Kenneth Hardesty
(408) 591-7528
ken@gerbsmanpartners.com

Read Full Post »

SALE OF SATIETY, INC.

Gerbsman Partners (www.gerbsmanpartners.com) has been retained by Satiety, Inc. (www.satietyinc.com) to solicit interest for the acquisition of all, or substantially all of, Satiety’s assets (the “Satiety Assets”).

IMPORTANT LEGAL NOTICE:

The information in this memorandum does not constitute the whole or any part of an offer or a contract.

The information contained in this memorandum relating to the Satiety’s Assets has been supplied by Satiety. It has not been independently investigated or verified by Gerbsman Partners or their respective agents.

Potential purchasers should not rely on any information contained in this memorandum or provided by Gerbsman Partners (or their respective staff, agents, and attorneys) in connection herewith, whether transmitted orally or in writing as a statement, opinion, or representation of fact. Interested parties should satisfy themselves through independent investigations as they or their legal and financial advisors see fit.

Gerbsman Partners, and their respective staff, agents, and attorneys, (i) disclaim any and all implied warranties concerning the truth, accuracy, and completeness of any information provided in connection herewith and (ii) do not accept liability for the information, including that contained in this memorandum, whether that liability arises by reasons of Satiety’s or Gerbsman Partners’ negligence or otherwise.

Any sale of the Satiety Assets will be made on an “as-is,” “where-is,” and “with all faults” basis, without any warranties, representations, or guarantees, either express or implied, of any kind, nature, or type whatsoever from, or on behalf of Satiety and Gerbsman Partners. Without limiting the generality of the foregoing, Satiety and Gerbsman Partners and their respective staff, agents, and attorneys,  hereby expressly disclaim any and all implied warranties concerning the condition of the Satiety Assets and any portions thereof, including, but not limited to, environmental conditions, compliance with any government regulations or requirements, the implied warranties of habitability, merchantability, or fitness for a particular purpose.

This memorandum contains confidential information and is not to be supplied to any person without Gerbsman Partners’ prior consent. This memorandum and the information contained herein are subject to the non-disclosure agreement attached hereto as Exhibit A.

Based in Palo Alto, California, Satiety, Inc. is a medical device company focused on the development of less invasive devices for the treatment of obesity. Satiety’s first product, the TOGA® System, enables physicians to perform a procedure similar to traditional restrictive obesity surgeries, but without surgical incisions. Satiety, Inc. was founded in 2000 through a collaboration of medical device incubators Thomas Fogarty Engineering and The Foundry, and is headquartered in Palo Alto, California.

Satiety believes its assets are attractive for a number of reasons:

·     Significant Unmet Need: Obesity is one of the largest and growing health risks in the developed world.  Although surgery is the only scientifically proven method for patients to lose weight and keep it off, less than 2% of the 22mm eligible patients in US elect to have surgery every year. One of the primary reasons is fear of the risks and complications associated with current bariatric surgeries.  A minimally invasive, safe, and effective option could potentially meet this significant unmet need.

·     Innovative Approach: Satiety’s TOGA® Procedure (trans-oral gastroplasty) is considered to be one of the most unique, innovative and promising technologies currently being evaluated for the minimally invasive treatment of obesity.  The TOGA Procedure was named by the Cleveland Clinic in its “Top 10 Medical Innovations for 2011” demonstrating the excitement in the broad medical community for the TOGA approach and the relevance and need for this kind of treatment option.

·     Demonstrated Multi-Site Clinical Validation: Over the past four years, Satiety has demonstrated the safety and effectiveness of the TOGA Procedure.  Over 470 patients have been treated in OUS pilot trials and in an FDA-approved randomized sham-controlled US pivotal trial. No known development-stage medical device company has treated more obese patients or has a more comprehensive data set.

·     Strong Intellectual Property Portfolio: Satiety’s Intellectual Property is broad, comprising 26 issued US patents, 33 pending US patent applications, 26 issued international patents, and 40 international pending patent applications, covers multiple methods and devices for the treatment of obesity, including seminal coverage for the TOGA Procedure and System.

·     Commercialization Path: The TOGA System has received the CE-Mark and a Pre-Market Approval (PMA) is in process in the US.

Impact of Technology on the Market

Over the last decade, obesity in the United States has reached epidemic proportions and is now recognized as a national health threat and a national health challenge. Obesity is a global health problem as well, affecting 70 million people in the U.S. and 300 million worldwide, the growth of which is causing alarming increases in obesity-related diseases such as diabetes, high blood pressure and cardiovascular disease.  Obesity-related health costs in the United States are estimated to be in excess of 100 billion dollars annually.

Despite the scientific evidence that surgical intervention is the only proven way for patients to lose weight, less than 2% of the eligible surgical candidates in the US seek surgical treatment every year. The incidence of obesity per year is significantly greater than the number of surgical procedures being performed leading to a rapidly increasing prevalence of the disease.  As of 2008, over 22 mm patients in the US met the NIH criteria for surgical treatment of obesity and this number is growing rapidly.

Market research indicates that a significant reason for the low patient adoption of surgical treatments for obesity is patients’ fear of the risks and complications associated with well-known bariatric surgeries such as the gastric bypass.

Satiety’s minimally invasive approach, known as the TOGA (trans-oral gastroplasty), is an incision-less endoscopic treatment that results in no scars, implants, or risks of wound infection while demonstrating in pilot and a multi-center US blinded sham-controlled trial that patients can achieve clinically meaningful weight loss with a significantly reduced risk of side effects when compared to currently available surgical treatments.  When made available to patients, TOGA could potentially offer millions of patients a truly safe, effective, and less invasive option that is not currently available.

Satiety believes that based on this significant unmet need and the clinical trial results conducted at multiple US and OUS clinical centers over the past 4 years, the TOGA Procedure has the potential to become one of the leading minimally invasive treatments for obesity and may open up an entirely new market for obesity surgery.

Satiety Company Profile

Founded in 2000, Satiety, Inc. is a private, Palo Alto-based medical device company focused on the development of less invasive devices for the treatment of obesity.  Over the past ten years, the company has raised approximately $86mm from leading venture capital firms including Venrock Associates, Abbott Ventures, Morgenthaler Ventures, Three Arch Partners, Skyline Ventures, HLM Ventures, and Pinnacle Ventures, as well as others.

Satiety’s first product, the TOGA® System, enables physicians to perform a procedure similar to traditional restrictive obesity surgeries, but without surgical incisions. In this procedure, the TOGA System devices are inserted transorally (through the mouth) into the stomach where they are used to create a narrow passageway or “sleeve” (See Figure 1). The sleeve slows the movement of food through the stomach, giving patients a feeling of fullness (satiety) after a smaller meal. The procedure is intended to be safer and easier for patients to tolerate than conventional obesity surgery.

Satiety’s Assets

Satiety has developed a portfolio of assets critical to the minimally invasive treatment of obesity. These assets fall into a variety of categories, including:

·     Patents, Patent Applications and Trademarks
·     Unique Prospective, Randomized Patient Data Set for Treating Obesity
·     Surgical Technology and Product Inventory
·     Trans-oral Devices and Procedure
·     Next Generation Product Designs
·     Product Cost Reduction Designs
·     Manufacturing, Design and Calibration Equipment
·     Current FDA Approved Clinical Trials and regulatory correspondance
·     CE Mark for the TOGA System
·     Intellectual Capital and Expertise

The Satiety Assets will be sold in whole or in part (collectively, the “Satiety Assets”). The sale of these assets is being conducted with the cooperation of Satiety. Satiety and certain of its employees will be available to assist purchasers with due diligence and a prompt, efficient transition to new ownership. Notwithstanding the foregoing, Satiety should not be contacted directly without the prior consent of Gerbsman Partners.

Key Personnel

·       Eric Reuter — CEO & President:

Eric M. Reuter joined Satiety as President, Chief Executive Officer and Director in May 2008.  Prior to joining Satiety, he served on the board of directors of Insound Medical.  From June 1999 until August 2006 Eric was President, Chief Executive Officer, and Director of Laserscope, a publicly traded medical device company that was sold to American Medical Systems.  Eric joined Laserscope as Vice-President, Research and Development in September 1996. Before joining Laserscope, from February 1994 to August 1996, Eric was employed at the Stanford Linear Accelerator Center at Stanford University (SLAC) as the Project Engineer for the B-Factory High Energy Ring, an electron storage ring used for high-energy physics research. From February 1991 to January 1994, he served as a senior staff engineer and program manager in digital imaging at Siemens Medical Systems — Oncology Care Systems, a medical device company.  Eric has a Bachelor of Science degree in Mechanical Engineering and Materials Science & Engineering from UC Davis.

·       Robert Gaffney — Vice President of Operations and Product Development:

Bob has over 22 years experience in the medical device field. He started with Cordis Corporation as a manufacturing engineer in the pacemaker division, and held various positions within Operations and Product Development. From there he was one of the first employees, with the start-up Ventritex. Robert helped develop the Ventritex implantable defibrillator and built the manufacturing organization to over 300 employees, leading them through an IPO and eventual sale to St. Jude Corporation. After Ventritex Robert went to Avocet Medical to help launch a blood coagulation meter, a product that required high volume manufacturing of meters, disposable strips and chemistry. Robert has been at Satiety since 2003. He has a Bachelors of Mechanical Engineering from the Georgia Institute of Technology and an MBA from Pepperdine University.

·       John Gaiser — V.P.R&D:

John is currently Vice President of Research and Development at Satiety. He has been leading product development groups for over 25 years in the fields of cardiology, gastroenterology, and surgery. He holds a number of issued patents and other publications in these fields. Prior to Satiety, John was Vice President of R&D at Curon Medical, a developer of devices for treating gastroesophageal reflux and incontinence, and at Medtronic CardioRhythm, a developer of cardiac ablation systems. John has also held R&D management and senior engineering positions of increasing responsibility at Guidant, Inc. and at Baxter Healthcare. John holds a BS in Mechanical Engineering from Purdue University.

·       Rachel Croft – V. P. Marketing:

Rachel joined Satiety in August 2006 as Vice President of Marketing. Prior to joining Satiety, she was an entrepreneur-in-residence with four venture capital firms evaluating medical device business opportunities. Prior to that she held several positions in product management, business development, reimbursement and eventually as Vice President of Marketing at Curon Medical. Before entering the medical device industry, Rachel spent 5 years in equity research and corporate finance focused on health care companies at Lehman Brothers and Robertson Stephens & Company. Rachel holds a BS in Industrial Engineering from Stanford University and an MBA from The Wharton School at University of Pennsylvania.

·       Jane Beggs – Director of Regulatory Affairs:

Jane Beggs joined Satiety in October of 2007 as Director of Regulatory Affairs.  Jane has 20 years of leadership roles in regulatory, clinical and quality systems.  Early management roles at ACS (Guidant) led to worldwide regulatory approvals for PTCA catheters, guidewires and accessories.  At Perclose (Abbott), she secured the expedited PMA of the original 9French device and PMA supplements for 8Fr and 5Fr devices.  In other start-ups, Jane’s responsibility included the integration of clinical operations for conducting clinical trials (feasibility, pivotal and marketing studies), certified quality systems and regulatory approvals for the US, Europe, Australia, Canada and Japan.  Jane has a bachelor’s degree in Biology (UC Berkeley) and MBA (finance) degree (Notre Dame de Namur University, Belmont, CA).
·       Renee Kochevar — Director of Clinical Affairs:

Renée joined Satiety in February 2009 as Director of Clinical Affairs.  Prior to joining Satiety she worked for nine years in clinical research for several medical device companies.  Prior to that she spent six years in academic clinical research at Harvard University and Tufts University.  Renée holds a BA in Biology from the University of Colorado, Boulder, a BA in Psychology from Colorado State University, a PhD in Clinical Psychology from the Joint Doctoral Program at the University of California, San Diego and San Diego State University, and a master’s degree (ALM) in Natural Sciences, Medical Anthropology from Harvard University.

Satiety, Inc. Board of Directors

·       Hank Plain – Chairman: Morgenthaler Ventures

·       Bryan Roberts:  Venrock Associates

·       John Freund:  Skyline Partners

·       Michael Bates – Audit Chair: Independent

·       Rod Young: Three Arch Partners

·       Tom Fogarty: Co-founder of Satiety

·       Eric Reuter: CEO, Satiety, Inc.

The Bidding Process for Interested Buyers

Interested and qualified parties will be expected to sign a nondisclosure agreement (attached hereto as Exhibit A) to have access to key members of the management and intellectual capital teams and the due diligence “war room” documentation (the “Due Diligence Access”). Each interested party, as a consequence of the Due Diligence Access granted to it, shall be deemed to acknowledge and represent (i) that it is bound by the bidding procedures described herein; (ii) that it has an opportunity to inspect and examine the Satiety Assets and to review all pertinent documents and information with respect thereto; (iii) that it is not relying upon any written or oral statements, representations, or warranties of Gerbsman Partners, or their respective staff, agents, or attorneys; and (iv) all such documents and reports have been provided solely for the convenience of the interested party, and Gerbsman Partners (and their respective, staff, agents, or attorneys) do not make any representations as to the accuracy or completeness of the same.

Following an initial round of due diligence, interested parties will be invited to participate with a sealed bid, for the acquisition of the Satiety Assets. Sealed bids must be submitted so that it is actually received by Gerbsman Partners no later than Friday, February 4th, 2011 at 3:00 p.m. Pacific Standard Time (the “Bid Deadline”) at Satiety’s office, located at 2470 Embarcadero Way, Palo Alto, CA.  Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in a specific and identifiable way. The attached Satiety list (Exhibit “B”) may not be complete and Bidders interested in the Satiety Equipment must submit a separate bid for such assets. Be specific as to the assets desired.

Any person or other entity making a bid must be prepared to provide independent confirmation that they possess the financial resources to complete the purchase where applicable. All bids must be accompanied by a refundable deposit check in the amount of $200,000 (payable to Satiety, Inc.). The winning bidder will be notified within 48 hours of the Bid Deadline. Non-successful bidders will have their deposit returned to them. Satiety reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.

Satiety reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.  Interested parties should understand that it is expected that the highest bid submitted will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission.

Satiety will require the successful bidder to close within a 7 to 14 day period. Any or all of the assets of Satiety will be sold on an “as is, where is” basis, with no representation or warranties whatsoever.

All sales, transfer, and recording taxes, stamp taxes, or similar taxes, if any, relating to the sale of the Satiety Assets shall be the sole responsibility of the successful bidder and shall be paid to Satiety at the closing of each transaction.

For additional information, please see below and/or contact:

Steven R. Gerbsman
Gerbsman Partners
(415) 456-0628
steve@gerbsmanpartners.com

James Skelton
Gerbsman Partners
(949) 466-7303
jim@gerbsmanpartners.com

Kenneth Hardesty
Gerbsman Partners
(408) 591-7528
ken@gerbsmanpartners.com

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Trends in Terms of Venture Financings In the San Francisco Bay Area (Third Quarter 2010)

http://fenwick.com/publications/6.12.1.asp?vid=15&WT.mc_id=2010.Q3_VCS_BK_EMAIL

We hope you find this information useful and would be happy to answer any questions you might have regarding the surveys.

Regards,
Barry Kramer
Michael Patrick – Fenwick & West

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