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Posts Tagged ‘Kenneth Hardesty’

The Bidding Process, Procedures for the Sale of certain Assets and Intellectual Property of Bambeco Inc.

Further to Gerbsman Partners sales letters of October 2, 2017 and September 28, 2017 regarding the sale of certain assets of Bambeco, Inc. (“Bambeco”), I am attaching the “Draft Asset Purchase Agreement (“APA”) and the Bambeco Dataroom “Table of Contents” for interested parties bidding on the assets and IP of Bambeco and performing due diligence, subject to the attached Bambeco NDA.

Please be aware that the bid date for the Assets and Intellectual Property of Bambeco is now Friday, October 20, 2017.  Bambeco is accelerating the bid date as it has received potential order in excess of $ 2million from a large retail customer.  Shipment is projected in December 2017 and January 2018 and in order to preserve value for a potential acquirer for these orders, Bambeco has moved the bid date to insure factory production.  Subject to an NDA, the CEO is available to discuss in greater detail. 

Ken, Jim, Dennis and I will be following up to review the updated Bidding Process, schedule due diligence meetings and answer any questions regarding the “Date Certain M&A Process”.

Prior to the bid date of October 20, 2017, I would encourage all interested parties to have their counsel speak with Geoff Willard, Esq. of Cooley.  He is availabel to discuss any questions or comments of a legal nature relating to the transactions contemplated in the attached “APA”.   Geoff is available to discuss any questions or comments of a legal nature relating to the transactions contemplated by the APA.  Geoff’s office number is 703 456 8188 and cell 202 257 0092; gwillard@cooley.com

Any and all the assets of Bambeco will be sold on an “as is, where is” basis and will be subject to “The Bidding Process for Interested Buyers”, outlined below.

Gerbsman Partners (http://www.gerbsmanpartners.com) has been retained by Bambeco (www.bambeco.com) to solicit interest for the acquisition of part or substantially all of Bambeco’s assets, including its Intellectual Property (“IP”), in whole or in part (collectively, the “Bambeco 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 Bambeco’s Assets has been supplied by Bambeco. 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 Bambeco’s or Gerbsman Partners’ negligence or otherwise. 

Any sale of the Bambeco 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 Bambeco and Gerbsman Partners. Without limiting the generality of the foregoing, Bambeco and Gerbsman Partners and their respective staff, agents, and attorneys, hereby expressly disclaim any and all implied warranties concerning the condition of the Bambeco 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.

 

The Bidding Process for Interested Buyers

Interested and qualified parties will be expected to sign a Confidential Disclosure Agreement (attached hereto as Appendix A) to have access to key members of management and intellectual capital teams and the due diligence “war room” documentation (“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 had an opportunity to inspect and examine the Bambeco 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 Bambeco Assets. Each sealed bid must be submitted so that it is received by Gerbsman Partners no later than Friday, October 20, 2017 at 3:00pm Eastern Standard Time (the “Bid Deadline”) at Bambeco’s offices, located at 3430 Second Street, Suite 300, Baltimore, MD 21225. Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in an identifiable way. 

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.  All bids must be accompanied by a refundable deposit in the amount of $200,000 (payable Bambeco, Inc.).  The deposit should be wired to an escrow agent who will be outlined in a future update.  The winning bidder will be notified within 3 business days of the Bid Deadline.  Unsuccessful bidders will have their deposit returned to them within 3 business days of notification that they are an unsuccessful bidder. 

Bambeco 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 and best bid submitted will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission.  

Bambeco will require the successful bidder to close within a 7 day period. Any or all of the assets of Bambeco 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 Bamboo Assets shall be the sole responsibility of the successful bidder and shall be paid to Bambeco at the closing of each transaction.

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

Steven R. Gerbsman                                                  

Gerbsman Partners                                                    

steve@gerbsmanpartners.com                  

 

Kenneth Hardesty

Gerbsman Partners

ken@gerbsmanpartners.com

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The Bidding Process, Procedures for the Sale of certain Assets and Intellectual Property of Bambeco.Inc.

Further to Gerbsman Partners sales letters of September 28, 2017 regarding the sale of certain assets of Bambeco, Inc. (“Bambeco”), I am attaching the Bambeco Dataroom “Table of Contents” for interested parties bidding on the assets and IP of Bambeco and performing due diligence, subject to the attached Bambeco NDA.

Ken, Jim, Dennis and I will be following up to review the Bidding Process, schedule due diligence meetings and answer any questions regarding the “Date Certain M&A Process”.

Gerbsman Partners (http://www.gerbsmanpartners.com) has been retained by Bambeco (www.bambeco.com) to solicit interest for the acquisition of part or substantially all of Bambeco’s assets, including its Intellectual Property (“IP”), in whole or in part (collectively, the “Bambeco Assets”).

Any and all the assets of Bambeco will be sold on an “as is, where is” basis and will be subject to “The Bidding Process for Interested Buyers”, outlined below.

  

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 Bambeco’s Assets has been supplied by Bambeco. 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 Bambeco’s or Gerbsman Partners’ negligence or otherwise. 

Any sale of the Bambeco 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 Bambeco and Gerbsman Partners. Without limiting the generality of the foregoing, Bambeco and Gerbsman Partners and their respective staff, agents, and attorneys, hereby expressly disclaim any and all implied warranties concerning the condition of the Bambeco 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.

 

The Bidding Process for Interested Buyers

Interested and qualified parties will be expected to sign a Confidential Disclosure Agreement (attached hereto as Appendix A) to have access to key members of management and intellectual capital teams and the due diligence “war room” documentation (“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 had an opportunity to inspect and examine the Bambeco 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 Bambeco Assets. Each sealed bid must be submitted so that it is received by Gerbsman Partners no later than Thursday, October 25, 2017 at 3:00pm Eastern Standard Time (the “Bid Deadline”) at Bambeco’s offices, located at 3430 Second Street, Suite 300, Baltimore, MD 21225. Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in an identifiable way. 

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.  All bids must be accompanied by a refundable deposit in the amount of $200,000 (payable Bambeco, Inc.).  The deposit should be wired to an escrow agent who will be outlined in a future update.  The winning bidder will be notified within 3 business days of the Bid Deadline.  Unsuccessful bidders will have their deposit returned to them within 3 business days of notification that they are an unsuccessful bidder. 

Bambeco 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 and best bid submitted will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission.  

Bambeco will require the successful bidder to close within a 7 day period. Any or all of the assets of Bambeco 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 Bamboo Assets shall be the sole responsibility of the successful bidder and shall be paid to Bambeco at the closing of each transaction.

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

 

Steven R. Gerbsman                                                  

Gerbsman Partners                                                    

steve@gerbsmanpartners.com                  

 

Kenneth Hardesty

Gerbsman Partners

ken@gerbsmanpartners.com

 

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SALE OF BAMBECO, INC. 

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

Headquartered in Baltimore, Maryland, Bambeco is the leader in sustainable and socially responsible home décor and furnishings in the Unites States. Founded in 2009, Bambeco is a private, Maryland-based, growth stage sustainable home goods company. Over the past 9 years, Bambeco has raised approximately $31mm in equity and debt from leading venture capital firms including ABS Capital, New Atlantic Ventures and NOVUS Capital.  Please see detail “Executive Summary”, Bambeco NDA and Schedule of Trademarks and Patents attached.

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 Bambeco’s Assets has been supplied by Bambeco. 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 Bambeco’ or Gerbsman Partners’ negligence or otherwise. 

Any sale of the Bambeco 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 Bambeco and Gerbsman Partners. Without limiting the generality of the foregoing, Bambeco and Gerbsman Partners and their respective staff, agents, and attorneys, hereby expressly disclaim any and all implied warranties concerning the condition of the Bambeco 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.

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

  1.  Market leader in a fast growing $31B (by 2020) sustainable home décor and furniture market.
  2.  Intellectual Property – proprietary product design and sourcing platform and network of 360+ vetted factories around the globe (27 countries) that can produce home furnishings and furniture products with stringent environmental and people standards.  The standards reduce carbon emissions and water while eliminating toxic chemicals and metals.
  3.  Significant dollars invested into the conception, design and development of sustainable products for all home décor and furniture categories, product lines and material types.  The company will continue to innovate; however, research and development and design costs for all key categories have been invested and the company’s only product costs are related to seasonal product and design refreshes and future innovation.
  4. $750K invested in SAP Hybris B2C and B2B omni-channel POS, CMS, and WMS platforms to enable best-in-class home décor and furnishings shopping experience, seamless expansions across markets and countries. Supply chain and sourcing network tapping less than 1% of its overall combined capacity and highly scalable.
  5.  Clear customer profile of the sustainable and socially responsible customer and a customer file of loyal buyers (repeat rate 55%+).  132MM sustainable and socially responsible consumers in the US spanning GenX, Millennials and Boomers
  6.  A fast growing Millennial segment, which cares about socially responsible and sustainable brands, is the largest home buyer in the US real estate market.  The segment has grown more than 170% in the Bambeco file over the past two years.
  7.  Vertically integrated supply chain executing stringent environmental and people standards that can produce authentic sustainable products with 75%+ margins.
  8.  Large strategic B2B customers:  Costco, Total Wine, Whole Foods, The Home Depot and more featuring Bambeco shop-in-shops showcasing the brand in the market.  Bambeco is in 1600 retail doors, hotels and restaurants.
  9.  Experienced and innovative team with sustainable market know-how and a CEO & Founder (from Williams-Sonoma) that is the thought leader in the sustainable home goods sector and in sustainability and climate change
  10. Blueprint for achieving first net neutral home goods retail company. The Company is on track to achieve this by 2020.
  11. Partnerships to deliver CarbonFree to the customers’ doors across the US.
  12. Certifications from Forest Stewardship Counsel (FSC), OEKO-TEX and Global Organic Textile Standards (GOTS).
  13. Strategic relationships with press, environmental organizations, and celebrities.
  14. Net Revenue since inception is $20.4MM, FY16 $5MM, and as of Aug 31st$4MM in FY17 (fiscal year ends January 31, 2018, 45% annual revenue occurs in Q4).

Bambeco Company Profile

Founded in 2009, Bambeco is a private, Maryland-based, growth stage sustainable home goods company. Over the past 9 years, Bambeco has raised approximately $31mm in equity and debt from leading venture capital firms including ABS Capital, New Atlantic Ventures and NOVUS Capital.

Bambeco is a leader in designing and developing innovative, sustainable home décor and furnishings with reduced carbon footprint and water and elimination of toxicity to allow consumers to live their environmental values and create a healthier home.

In 2016 at Climate Week in New York City, Bambeco announced its commitment to become carbon neutral by 2020, making the company the first carbon neutral home goods retailer in the world. Bambeco was accompanied by General Electric, Phillips. Bank of America, and Apple in this announcement at the event attended by world leaders – business and government. The company has been executing a carbon neutrality blueprint since being founded by Aplin in 2009.  She and Bambeco serve as a market leader and driver pushing the retail industry to change its practices to produce and deliver products with less of an impact on the environment by reducing greenhouse gases, water usage, and eliminating toxic chemicals and production methods.

Bambeco has set the sustainability standards bar for the home décor and furnishings industry.  The company has achieved certifications from the top three organizations that govern responsible forestation and organic and toxic free textiles. The remaining home décor and furnishings categories lack third party certifications. Bambeco has developed those standards and a supply chain that can meet those standards across the remaining product types and categories and the company continues to innovate.  Today, all of the company’s wood products come from FSC or “good wood” sources (e.g. reclaimed barn wood, responsibly harvest highly renewable woods); glassware made from recycled soda bottles; textiles from certified organic and natural fibers without pesticides and reduced water; dinnerware made from natural minerals and biomass from previous production with toxic free dyes and glazes; and outdoor furniture made from recycled detergent bottles. Bambeco is a product innovator that has reimagined every home décor and furniture product, delivery method, packaging, business practice, consumer engagement, and company culture through the lens of sustainability and social responsibility. The company’s mission is to Change the World…One Room at a Time.

The company designs and produces home products for all rooms in the house, as well as products made for outdoor living.  Our more than 4,000 products are made by more than 10,000 fair wage and safe workers around the world.

Sustainable Home Goods Market

The sustainable home goods market opportunity is estimated to be $31B by 2020.  The rapid growth is fueled by a growing consumer demand for socially responsible high quality products that are made with less of an impact on the planet and fair and safe wage employee practices by authentic brands.  Today, there are 132 million socially responsible, sustainable consumers in the United States (58MM Millennials, 32MM GenX and 42MM Boomers).

  • Recent accelerated growth is being fueled by the large eco-conscious millennial consumer segment.  The millennial household formations continue to grow, representing 35% of all new home buyers. Millennials will be 46% of the workplace in 2020.
  • Passionate GenX and Boomer segments, inspired to leave the world in a better place and concerned by chemicals and toxins found in traditional home goods products, continue to see an expansion in discretionary spending and prioritize a more sustainable lifestyle.

Sustainable home décor and furnishings consumers are inspired by sustainable living across other aspects of their lives (sustainably focused hotel lodging, organic and natural groceries, hybrid/electric/green diesel autos, natural body products and cleaning supplies, etc).  These consumers report that sustainability is the first or second filter used in all purchase decisions and 40% of consumers are willing to pay more for sustainable goods.

The sustainable home goods market is fragmented and underserved today with limited and targeted product lines sold across retailers and small mom and pop stores.  Bambeco is the only home brand fully dedicated to selling only sustainable home goods and a trusted product offering across all home categories. 

Bambeco’s Assets

Bambeco has developed a portfolio of assets critical to the sustainable home décor and furnishings market. These assets fall into a variety of categories, including:

  1.  Recognized authentic and credible sustainable brand in the market
  2.  Intellectual Property and Technology platforms:  IMPACT sourcing platform, omni-channel POS, content management and warehouse management platform, and ERP and B2B order processing system
  3.  Vetted Factory Network of 360 Factories
  4.  Inventory in the categories:  Kitchen and Tabletop, Furniture, Bedding, Bath, Outdoor, Home Décor & Accessories, and Gifts
  5.  Patents, Patent Applications, Copyrights and Trademarks
  6.  Sustainable Product Designs and Ingredients
  7.  Customer File and Profile of the Sustainable Customer
  8.  Warehousing Storage and Processing Equipment
  9.  Strategic Accounts and additional $1.3 million in Purchase Orders from Costco, Whole Foods, and Total Wine in-house
  10.  B2C and B2B Revenue
  11. .Intellectual Capital and Premium Brand and Home Industries Expertise (from company’s such as, Williams Sonoma, Pottery Barn, West Elm, Gap, Hallmark, Red Envelope, and TravelSmith) and Sustainability Expertise as the pioneer and leader of the Sustainable Home Goods market.

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

Revenue

Bambeco has two primary distribution channels today:  B2C (ecommerce) and B2B (retail, restaurant, and hotel customers).  The direct-to-consumer channel and the wholesale (SiS:  shop-in-shop) channels have continued to grow year-over-year.   FY17 includes 8 months of actual sales (fiscal year ends January 31,2018 and 45% of sales occur in Q4.

Key Personnel –

Susan Aplin — CEO & Founder:  Formerly head of Direct-to-Consumer at Williams-Sonoma with over 25 years of retail and ecommerce industry experience.  Held management roles at Gap, The Sports Authority and Staples.

Deborah Baldini — Chief Brand Officer:  Formerly of Cambria Cove, Hallmark, Levis and Style Savvy.   30+ years in the retail and technology industries.

Brian Tsung — Chief Marketing Officer & Head of Direct to Consumer:  Formerly of TravelSmith, Williams-Sonoma / Pottery Barn, Red Envelope and Hallmark.   25+ years of marketing and ecommerce retail and director-to-consumer experience.

Sol Garay — Chief Merchandising Officer:  Formerly of Williams-Sonoma, Pottery Barn, Gap, Proctor & Gamble, and S.C. Johnson Wax.  20+ years of product management experience.

Carolyn Wapnick – Chief Sustainability Officer:  Formerly of Live Elements, Corporation for Public Broadcasting, Cable in the Classroom and VMS.  25 years of creating social and educational platforms.

Colleen Wood – Chief People Officer:  Formerly of SVP of HR at Living Social.  Held management HR roles at Attachmate Group and EDS. 15+ years of HR management experience.

 

Bambeco, Inc. Board of Directors-

Susan Aplin, Chairman of the Board: Baltimore, MD

Cal Wheaton:  ABS Capital – Baltimore, MD

Thanasis Delistathis: New Atlantic Ventures – Reston, VA

Catherine Levene: Former digital media and ecommerce CEO – New York, NY

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 Bambeco 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 Bambeco Assets. Sealed bids must be submitted so that the bid is actually received by Gerbsman Partners no later than Thursday, October 25, 2017 at 3:00 p.m. Pacific Standard Time (the “Bid Deadline”) at Bambecos’ office, located at 3430 Second Street, Suite 300, Baltimore, MD 21225.  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 Bambeco fixed asset list may not be complete and Bidders interested in the Bambeco 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 Bambeco, Inc.). Information on where to send the refundable depoist will be sent in a later update.  The winning bidder will be notified within 3 business days after the Bid Deadline. Non-successful bidders will have their deposit returned to them. Bambeco reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.

Bambeco will require the successful bidder to close within 7 business days.  Any or all of the assets of Bambeco 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 Bambeco Assets shall be the sole responsibility of the successful bidder and shall be paid to Bambeco 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

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The Bidding Process, Procedures for the Sale of certain Assets and Intellectual Property of Gamma Medical, Inc.

Further to Gerbsman Partners (http://gerbsmanpartners.com)sales letter of July 5, 2017, regarding the sale of certain assets of Gamma Medica, Inc. , (“Gamma Medica”), I am attaching the Asset Purchase Agreement “APA” and Bill of Sale and Assignment and Wire Transfer information (below).

Please be advised that the Gamma Medica Assets are being offered for sale by HercGamma, Inc., a Delaware Corporation, (”HercGamma”) and an affiliate of Hercules Capital, Inc., Gamma’s Senior Secured Party.  HercGamma has acquired title to such assets pursuant to Section 9-610 of the Uniform Commercial Code.  Purchasers of the Gamma Medica Assets will receive all of HercGamma’s right, title, and interest in the purchased portion of  Gamma Medica’s assets, as provided in the Uniform Commercial Code.

Ken and I will be following up to review the Bidding Process, schedule due diligence meetings and answer any questions regarding the “Date Certain M&A Process”.

The sale is being conducted by Hercules for the benefit of HercGamma.  Hercules will use best efforts to make select Gamma Medica’s employees available to assist purchasers with due diligence and to assist with a prompt and efficient transition at a mutually convenient time.  Presently, all of Gamma Medica’s employee’s have been terminated; key employees have been retained as consultants.

Any and all the assets of Gamma Medica will be sold on an “as is, where is” basis and will be subject to “The Bidding Process for Interested Buyers”, outlined below.

Prior to the bid date of August 7, 2017, and after you receive the draft “APA” I would encourage all interested parties to have their counsel speak with Barry M. Schwartz, Esq., counsel to Hercules (HercGamma).  He is available to discuss any questions or comments of a legal nature relating to the transactions contemplated by the APA.  Barry is available at 201 525 6204 and at bschwartz@coleschotz.com 

 

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 Gamma Medica 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 Hercules, HercGamma or GerbsmanPartners, 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 Hercules, HercGamma 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 Gamma Medica Assets. Sealed bids must be submitted so that the bid is actually received by Gerbsman Partners no later than Wednesday, August 7, 2017, 3:00pm Pacific Standard Time (the “Bid Deadline”) at 211 Laurel Grove Avenue, Kentfield, CA 94904.  Please also email steve@gerbsmanpartners.com with any bid.

Bids should identify those assets being tendered for in a specific and identifiable way.

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 (this will be wired to Hercules counsel trust account). The winning bidder will be notified within 3 business days after the Bid Deadline. Non-successful bidders will have their deposit returned to them. Hercules reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.

Hercules will require the successful bidder to close within 7 business days.  Any or all of the assets of Gamma Medica 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 Gamma Medica Assets shall be the sole responsibility of the successful bidder and shall be paid to Uptake 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

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Sale of Gamma Medica, Inc.

 

Gerbsman Partners – http://gerbsmanpartners.com  has been retained by Hercules Capital, Inc. (“Hercules”), the senior secured lender to Gamma Medica, Inc. (“Gamma Medica” or”GMI”), http://gammamedica.com  to solicit interest for the acquisition of all or substantially all of Gamma Medica’s assets, including its Intellectual Property (“IP”), in whole or in part (collectively, the “Gamma Medica Assets”).

Please be advised that the Gamma Medica Assets are being offered for sale by HercGamma, Inc., a Delaware Corporation, (”HercGamma”) and an affiliate of Hercules Capital, Inc., Gamma’s Senior Secured Party.  HercGamma has acquired title to such assets pursuant to Section 9-610 of the Uniform Commercial Code.  Purchasers of the Gamma Medica Assets will receive all of HercGamma’s right, title, and interest in the purchased portion of  Gamma Medica’s assets, as provided in the Uniform Commercial Code.

Please see the attached for additional detail information regarding the Sale of Gamma Medical, Inc.’s Assets and IP.  (detail information summary, teaser, patent listing, trademark listing and mutual NDA).
The sale is being conducted by Hercules for the benefit of HercGamma.  Hercules will use its best efforts to make Gamma Medica’s employees available to assist purchasers with due diligence and assist with a prompt and efficient transition at a mutually convenient time.  Presently, all of Gamma Medica’s employee’s have been terminated; key employees have been retained as consultants.

Gamma Medica is headquartered at 12 Manor Parkway, Salem, New Hampshire. To date, $34 million of capital has been invested in the company by Psilos Group and senior debt, by Hercules Capital. Hercules Capital has approximately  $ 1.8 million of senior debt, plus other expenses, (including without limitation late fee’s and costs of professionals).

Gamma Medica Company Profile

Gamma Medica, Inc. (‘GMI”) was founded in 2013 following the acquisition of the intellectual property and commercial assets by Psilos Group, who currently owns 100% of the equity.

GMI pioneered the development and commercialization of the first fully digital, dual headed Molecular Breast Imaging (“MBI”) system. MBI overcomes the inherent limitations of anatomical-based imaging technology such as Mammography (MM), Tomosynthesis(Tomo), Ultrasound (US) and Automated Breast Ultrasound (ABUS) in women with dense breast tissue. 

  1.  LumaGEM® MBI is indicated for secondary screening or diagnostic imaging for women who have dense breast tissue. Over 45% of all women present radiologists with a diagnostic challenge since standard mammography or tomosynthesis cannot discern tissue density from cancerous lesions due to the appearance of the lesions as white on a white background if fibrous tissue is present.  Quoting from published peer reviewed clinical papers, mammography only detects 3/1000, however, when MBI is used as a secondary screening device a further 9/1000 are detected. Ultrasound, when used in a similar protocol, only finds 3/1000.  LumaGEM® is a breakthrough technology for women who are at risk and/or dense breast tissue.
  2.  LumaGEM® can be easily incorporated into a busy clinical practice, the patient experience is far superior to mammography since no breast compression is required, a frequent complaint and a compliance problem.  The procedure is fully reimbursed (CMS) at 3.5x that of mammography. It is covered by the majority of commercial payers too.
  3.  MBI, through published prospective and blinded studies, have proven to detect cancer with superior technical and clinical performance, delivering unsurpassed sensitivity (91%) and specificity (93%).  To put into perspective, MRI only delivers 75% specificity. Further, the Negative Predictive Value of MBI is 99.7%, providing unsurpassed clinical assurance.
  4.  The Mayo Clinic, a licensor to GMI, as published widely, is currently a user of the technology (placement of 5 cameras), has proven to reduce unwanted biopsies (false positives) by 50%. LumaGEM® MBI is FDA approved, reimbursed (CPT Code 78800) and the company has placed 22 units in the USA to date. In the next 12 months, the company had anticipated to sell a further 20 units and with a pipeline of a further 200 accounts.  With the recent decision by the America College of Radiology to publish practice guidelines for the use of MBI, this will further enhance the commercial opportunity. In addition, 32 States have now issued the Dense Notification Law that requires all providers to issue letters of recommendation for women who have dense breast tissue. This will further raise awareness and demand for MBI to be used a secondary screening and diagnostic tool.
  5.  Economically, MBI strikes a strong proposition for the Affordable Care Act’s Triple Aim; MBI provides a compelling reason to adopt the technology as it provides strong economics, improved clinical outcomes and high patient satisfaction.
  6.  LumaGEM® MBI has a CE mark and marketing has commenced in the EU market. The company has one distributor contract in the UK and Ireland and is engaged with a number of other parties in Europe too. It has also Saudi Arabian approval and anticipating Canadian approval in Q3 2017.
  7.  LumaGEM® MBI is disruptive technology that will transform breast imaging. It has superior performance to standard secondary screening and diagnostic modalities in use today and is by far a lower cost, more accurate diagnostic tool compared to the “gold standard” of MRI perceived today.

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 Gamma Medica Assets has been supplied by Gamma Medica. It has not been independently investigated or verified by Gerbsman Partners, Hercules, HercGamma or their respective agents.


Potential purchasers should not rely on any information contained in this memorandum or provided by Gerbsman Partners and Hercules (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, Hercules, HercGamma 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 Gamma Medica’s or Gerbsman Partners’, Herucles’ negligence or otherwise.

Any sale of the Gamma Medica 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 Gamma Medica, Gerbsman Partners, HercGamma and Hercules. Without limiting the generality of the foregoing, Gamma Medica, Gerbsman Partners, HercGamma, Hercules and their respective staff, agents, and attorneys, hereby expressly disclaim any and all implied warranties concerning the condition of the Gamma Medica 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’ or Hercules’ prior consent. This memorandum and the information contained herein are subject to the non-disclosure agreement attached hereto as Exhibit A.

 

Hercules believes that Gamma Medica’s assets are attractive for a number of reasons:

Disruptive patented technology that delivers unsurpassed cancer detection rates, 91% sensitivity, 93% specificity, 99.7% negative predictive value and reduces biopsy rates due to false positives by 50%

Strong patent portfolio that includes (i) perpetual license agreements from the Mayo Clinic, Rochester, MN, (ii) GMI’s own strong portfolio, (iii) unique ASICS designed direct digital gamma technology.

Technology detects 9/1000 additional cancers in dense breast tissue women when used as a secondary screening device. Compare to Hologic’s new tomosynthesis device which yields <1/1000; they have an installed base of >4,000 machines over the last 4 years.

Delivers 1.6mm spatial resolution compared to the only other competitive (dual headed breast designated camera) GE HC at 2.5mm. This enables the technology to identify lesions 4mm in highly dense breast tissue. The CZT camera is the most sensitive on the market.

Due to the current IP and the in house knowledge, the risks of replicating are minimal.

Technology has application in other fields – superior SPECT camera to GE’s new platform.

Access to strong management team and trained sales force (7 direct) with extensive market and specific modality experience and expertise were involved with GammaMedica and are available to interview in due diligence.

USA installed base of 22 units, forecasted sale R12 a further 20 units, a pipeline of accounts of >200. Proven to be easily incorporated into clinical workflow and clinical adoption is seamless.

Reference account include Mayo Clinic (Rochester (MN), Jacksonville (FL), Phoenix (AZ); Einstein Medical Center (PA); Henry Ford (MI), Scripps (CA) to name a few.

Established supply chain, in house validated manufacturing camera capability.

FDA and CE market approved. Saudi Arabian approved. Canada – Q3 2017.

Reimbursed (CMS) CPT 78800 at global average rate $330; commercial coverage also established.

Potential to deliver cash flow positive by end 2019 by implementing the company’s business plan.

Planned and contracted (volume dependent)  COG’s reduction to yield 60% GP by 2020.

Turn-key operational handover.

Impact of Technology on the Market

With over 40,000 annual deaths due to breast cancer each year in the USA, there is clearly an unmet need. The current modalities in use today were discovered decades ago with no significant technology breakthrough since. The closest to an improvement has been the introduction of “3D” mammography (or Tomosynthesis) and Automatic breast ultrasound. Neither have yielded a significant increase in detection for women with dense breast tissue. Over 45% of Caucasian and over 65% of Asian women have dense breast tissue. Women with dense breast tissue are 3-5x more likely to develop breast cancer than non-dense breast women.

Breast cancer deaths are preventable if you deploy the appropriate personalized screening protocols and modalities. The current modalities deployed are not adequate. We now have published data from leading CoE’s that supportthis position.

GMI believes their MBI will be the standard of care for women at risk not only in the USA but other developed healthcare markets. The recent decision by the American College of Radiology to published practice guidelines, authenticates this position. This is what the radiologists have been waiting for.

GE is the only other competitor in the market. They have a repurposed cardiac imaging camera and delivers inferior performance to LumaGEM®.

Gamma Medica’s Assets

Gamma Medica has developed a portfolio of assets and intellectual property that fall into the following categories:

Patents, Patent Applications and Trademarks- integrated process

Service contracts on new placements

A $200K AR for a unit to be delivered to a site

Market equity – we have created the dense breast market and associated stake in as a leader in the field

Websites

Parts inventory

Tools and machinery

Manufacturing, Design and Calibration Equipment

FDA,CE and Saudi Approval

USA distributorship (3)

UK and Ireland Distributorship

The assets of Gamma Medica will be sold in whole or in part (collectively, the “GammaMedica ” assets). The sale of these assets is being conducted with the cooperation of Hercules and Gamma Medica previous management. Gamma Medica’s previous employees (consultants and interested previous employee’s) will be available to assist purchasers with due diligence and a prompt, efficient transition to new ownership. Notwithstanding the foregoing, Gamma Medica should not be contacted directly without the prior consent of Gerbsman Partners.

Personnel – as of 6.16.17, all personnel were terminated as part of a companywide reduction in force.  However, the following people have been retained by Hercules to act as advisors to interested parties as part of the sales process. Other key management personnel can also be contracted to assist as required.

 

Philip Croxford — Gamma Medica’s former President & CEO

Angie Dube — Gamma Medica’s former SeniorAccounting Manager

Steve Dallas – Gamma Medica’s formerVP Operations

 

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 Gamma Medica 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 Hercules, HercGamma or GerbsmanPartners, 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 Hercules, HercGamma 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 Gamma Medica Assets. Sealed bids must be submitted so that the bid is actually received by Gerbsman Partners no later than Wednesday, August 7, 2017, 3:00pm Pacific Standard Time (the “Bid Deadline”) at 211 Laurel Grove Avenue, Kentfield, CA 94904.  Please also email steve@gerbsmanpartners.com with any bid.

 

Bids should identify those assets being tendered for in a specific and identifiable way.

 

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 (this will be wired to Hercules counsel trust account and the specific wire transfer information will be supplied at a later date). The winning bidder will be notified within 3 business days after the Bid Deadline. Non-successful bidders will have their deposit returned to them. Hercules reserves the right to, in its sole discretion, accept or reject any bid, or withdraw any or all assets from sale.

 

Hercules will require the successful bidder to close within 7 business days.  Any or all of the assets of Gamma Medica 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 Gamma Medica Assets shall be the sole responsibility of the successful bidder and shall be paid to Uptake 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

 

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Steven R. Gerbsman, Principal of Gerbsman Partners and Kenneth Hardesty, a member of Gerbsman Partners Board of Intellectual Capital announced today their success in maximizing value for the assets and Intellectual Property of Igenica Inc.  Igenica Inc. focused on harnessing the natural tumor microenvironment to deliver a pipeline of high impact anti-body-based cancer therapeutics.

Gerbsman Partners provided Financial Advisory leadership to Igenica Inc., through    its proprietary Date Certain M&A Process, facilitated the sale of the business unit’s assets and its associated Intellectual Property and closing of the sale. Due to market conditions, the board of directors of igencia Inc. made the strategic decision to maximize the value of the business unit and Intellectual Property. Gerbsman Partners provided leadership to the company with:

  1. Business Consulting and Investment Banking 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. Communications with the Board of Directors, senior management, senior lenders, creditors, vendors and all stakeholders in 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 98 technology, medical device, life science, solar, fuel cell, cyber  security, consumer and digital marketing companies and their Intellectual Property and has restructured/terminated over $810 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, Orange County, Boston, New York, Washington, DC, McLean, VA, Europe and Israel.

email – steve@gerbsmanpartners.com

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Sale of intellectual property asset mcTMS

Gerbsman Partners has been retained by Rio Grande Neurosciences, Inc. (RGN) to solicit interest for the sale of RGN multicoil transcranial magnetic stimulation (mcTMS) Intellectual Property and Assets (“RGN Asset”).

Headquartered in Santa Fe, New Mexico, RGN is a medical device company that develops non-invasive brain stimulation (NIBS) technologies for use in treating neurological and psychiatric conditions and enhancing cognitive performance. $30MM has been invested in the mcTMS IP and technology development.

RGN has made a strategic decision to sell its TMS assets. The company has been in discussion with another party that has expressed an interest in acquiring the Company’s PEMF and TES assets and so has decided not to offer them for sale. The Company had previously expressed a desire to sell all three assets but withdrew the offer both because baseless claims were made that another entity had a prior right to buy the Company and of the pendency of an offer from a legitimate buyer to purchase all the the assets. The entity claiming to have a prior right to purchase the Company has withdrawn that claim, and the pending offer to purchase has narrowed to PEMF and TES.

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 RGN’s Asset (as defined herein) has been supplied by RGN. 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 RGN’s or Gerbsman Partners’ negligence or otherwise.

Any sale of the RGN Asset will be made on an “as-is,” “where-is,” and “with all faults” basis, without any warranties, representations, or guarantees, either expressed or implied, of any kind, nature, or type whatsoever from, or on behalf of RGN and Gerbsman Partners. Without limiting the generality of the foregoing, RGN and Gerbsman Partners and their respective staff, agents, and attorneys, hereby expressly disclaim any and all implied warranties concerning the condition of the RGN 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 Confidential Disclosure Agreement attached hereto as Appendix A.
Company Profile
Rio Grande Neurosciences, Inc. (RGN), a Santa Fe, New Mexico based medical device company, has developed a suite of non-invasive brain stimulation (NIBS) technologies for use in treating neurological and psychiatric conditions and enhancing cognitive performance. The NIBS technologies, also called electroceuticalsTM, include a multicoil transcranial magnetic stimulation (mcTMS) device.

Multi-coil TMS, IP from Stanford University and originally developed by Cervel Neurotech, involves selectively modulating brain circuit nodes. This is accomplished with an array of coils that steer induced electrical currents so as to optimally modulate targeted brain regions. Each magnetic coil is independently positioned and powered, thereby steering the electrical current toward unique brain areas not reachable by single-coil devices RGN’s mcTMS assets include a sought-after intellectual property position for TMS with multiple coils and strong clinical data in the areas of depression and pain. A complete FDA 510k application for treatment-resistant depression has been compiled.

Founded in 2011 as a start-up company with support from a Los Alamos National Labs (LANL) Venture Accelerator award, RGN has raised $6.2 million over 5 years of capital financing. Over $30 million has been invested into the development of mcTMS over time.

RGN believes its mcTMS assets are attractive for a number of reasons:
mcTMS
1. RGN’s intellectual property position for mcTMS covers the use of TMS with more than one coil, a position sought by single-coil TMS manufacturers.
2. mcTMS has advantages over single coil TMS, such as the ability to target multiple brain regions simultaneously or in sequence and to steer current to brain areas not addressable by single-coil approaches (e.g., deeper brain structures)
3. mcTMS has been shown to significantly reduce treatment resistant depression.
4. mcTMS treatment response rates were found to be markedly higher than that reported by single-coil TMS approaches for treatment-resistant depression.
5. Clinical studies (Stanford University) have shown that mcTMS can markedly reduce both acute and chronic pain.
6. Ongoing research at Stanford University has demonstrated proof of principle for a novel mcTMS pulsing method that can enhance plasticity (RGN-owned IP), a foundation for next generation TMS methodology that may be far more efficacious and require fewer treatments.

Impact of Technology on the Market
RGN’s mcTMS device offers a unique value proposition

mcTMS

1. RGN owns the only multicoil TMS device and the multicoil approach has a number of advantages over single coil TMS devices.

2. Single coil devices exhibit either shallow and focused stimulation (small diameter coils) or deep and diffuse stimulation (large diameter coils), but cannot stimulate deeper brain structures with selectivity.

3. Multicoil TMS employs an array of coils that steer induced electrical currents so as to optimally modulate targeted brain regions not reachable by single-coil devices. This approach has been shown to be clinically effective in depression and results in higher treatment response rates than single-coil TMS devices.

4. RGN’s IP position prevents competitors from using multiple coils.

5. New data suggest that a novel multicoil TMS pulsing sequence can enhance plasticity (RGN-owned IP), an approach that may result in a next generation TMS methodology that could dramatically increase efficacy and reduce treatment duration compared to current standards.

6. RGNs novel mcTMS business model is expected to capture significant market share and put pressure on single-coil competitors.

Intellectual Property Summary
RGN has an expansive portfolio of intellectual property that covers important methods and uses of NIBS. At present, RGN has (U.S.) 13 issued patents, 8 pending patents for mcTMS (some of which are licenses from Stanford University that are assignable). More detail can be found in Appendix B. The portfolio represents a broad array of strategic variables including:
mcTMS
1. Device for selective deep brain stimulation via multi-coil magnet arrays.
2. Methods for selectively modulating deep areas of the brain with shaped magnetic fields, using sulci as pathways for current flow.
3. Shaping of pulsed magnetic field is changed by altering the polarity of individual magnets with an array.
4. Use of different pulse rates from individual coils in one array and latencies between their discharges to achieve specific neuromodulation effects.
5. Network-based deep brain stimulation using multiple pulsed magnetic sources.

RGN’s mcTMS Asset
1. Patents, patent applications, and trademarks
2 Technology addressing the estimated the multibillion dollar global markets for treating depression
3. mcTMS clinical trial data for drug-resistant depression and pain
4. Unique and clinically relevant patient data
5. Next generation product designs
6. Product cost reduction designs
7. Device and component inventory
8. Intellectual capital and expertise
9. Complete FDA 510k application for treatment-resistant depression

The sale of the mcTMS asset is being conducted with the cooperation of RGN. RGN and its employees will be available to assist purchasers with due diligence and a prompt, efficient transition to new ownership. Notwithstanding the foregoing, RGN should not be contacted directly without the prior consent of Gerbsman Partners

Management
Steven Gluckstern, Ed.D., MBA – President & CEO

Steven has served as RGN’s president and CEO since 2011. Previously he has served as Chairman and CEO of Ivivi Health Sciences, Zurich Scudder Investments, and Centre Reinsurance.

Blake Gurfein, Ph.D. – Chief Science Officer
Blake is a neuroimmunologist and faculty member at the University of California San Francisco. Blake worked with RGN as a consultant from 2013-2014 and joined the company as Chief Science Officer in 2014. In this role, Blake oversees basic science and clinical research activities, manages staff, and interfaces with the medical advisory board. Blake has 15 years of experience in neuroscience and immunology research and has been involved in the design, development, and preclinical/clinical investigation of medical devices.

Sean Hagberg, Ph.D. – Chief Strategist
Sean co-founded RGN in 2011 and in 2004 co-founded Ivivi Technologies, which developed RGN’s PEMF technology. Sean is a faculty member at the University of New Mexico and served as Chief Science Officer of Ivivi and led the scientific and clinical research program, including several first-in-human RCTs with using PEMF. Sean has been involved in all aspects of PEMF IP development, testing, basic science through clinical trials and regulatory processes.

Michael Weisend, Ph.D – Senior Scientist
Mike is a neuroscientist and faculty member at the University of New Mexico, Wright State University, and The Mind Research Network. Mike consulted for RGN from 2011 to 2015 and joined as a senior scientist in late 2015. Mike has 25 years of experience in neuroimaging, brain stimulation, and device development with emphases in memory, epilepsy, mental illness.

Peter Schwartz, Ph.D. – Director of Engineering
Peter is an engineering executive with a background rooted in science, and he has worked with RGN since 2015, spearheading the mcTMS 510(k) effort. Peter has 20 years of experience in research and development of capital equipment ushering inventions from the laboratory through commercialization.

Bret Schneider, M.D. – Senior Scientist
Bret is the principal inventor of multi-coil TMS and has 25 years of experience in neurotechnology development. Bret is also a Consulting Associate Professor of Psychiatry at Stanford University School of Medicine and a practicing psychiatrist

Board of Directors
Steven Gluckstern, Chairman: CEO, Rio Grande Neurosciences
Stephen Juelsgaard, D.V.M., J.D.: Former General Counsel, Genentech
John Wilkerson: Managing Director, Galen Partners

The Bidding Process for Interested Buyers
Interested and qualified parties will be expected to sign a Confidential Disclosure Agreement (attached hereto as Appendix B) to have access to key members of management and intellectual capital teams and the due diligence “war room” documentation (“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 had an opportunity to inspect and examine the RGN 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 RGN Assets. Each sealed bid must be submitted so that it is received by Gerbsman Partners no later than Tuesday April 18, 2017 at 3:00pm Pacific Standard Time (the “Bid Deadline”) at 211 Laurel Grove Avenue, Kentfield, CA 94904. Please also email steve@gerbsmanpartners.com with any bid.

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. All bids must be accompanied by a refundable deposit in the amount of $200,000 (payable Rio Grande Neurosciences, Inc.). The wiring instructions for the deposit will be sent at a later date. The winning bidder will be notified within 3 business days of the Bid Deadline. The deposit will be held in trust by RGN’s counsel. Unsuccessful bidders will have their deposit returned to them within 3 business days of notification that they are an unsuccessful bidder.

RGN 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 and best bid submitted will be chosen as the winning bidder and bidders may not have the opportunity to improve their bids after submission.

RGN will require the successful bidder to close within a 7 day period. Any or all of the assets of RGN 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 RGN Assets shall be the sole responsibility of the successful bidder and shall be paid to RGN 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

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

Dennis Sholl
Gerbsman Partners
(415) 377-1952
dennis@gerbsmanpartners.com

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