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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
November 20, 1998
Eclipse Surgical Technologies, Inc.
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(Exact name of registrant as specified in its charter)
California
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(State or other jurisdiction of incorporation)
0-28288 77-0223740
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(Commission File No.) (IRS Employer Identification Number)
559 Weddell Avenue
Sunnyvale, California 94089
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(Address of Principal Executive Offices)
(408) 747-0120
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(Registrant's Telephone Number, Including Area Code)
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ITEM 5. OTHER EVENTS
In November 1998, Eclipse Surgical Technologies, Inc. (the "Company")
contributed certain licenses, patents, and other intellectual property ("the
contributed technology") and the MicroHeart name to MicroHeart Holdings, Inc.
("MicroHeart"), a Delaware company previously formed by U.S. Ventures and
Venrock Associates who on a combined basis invested $5.5 million in cash in
MicroHeart. MicroHeart designs and develops devices for drug delivery of
growth factors to promote angiogenesis in the heart. Myocardial
revascularization utilizing angiogenic drugs and growth factors is a nascent
technology intended to provide a new therapeutic approach to the treatment of
coronary artery disease and associated symptoms such as angina.
In exchange for the contributed technology and the MicroHeart name, the
Company received common stock (less than a 1% voting interest in MicroHeart)
and two warrants to acquire MicroHeart common shares. In addition, the
Company has the right to appoint one of the four Board members of MicroHeart.
The first warrant has an aggregate exercise price of $80,000 and a purchase
price of $8,000 and relates to specific contributed technology developed or
licensed by the Company prior to 1998 and the MicroHeart name. The second
warrant has an aggregate exercise price of $210,000 and a purchase price of
$20,000 and relates to contributed technology developed or licensed by the
Company in 1998 which MicroHeart believes may be important to its ongoing
product development efforts. The second warrant is cancelable by MicroHeart
at any time within one year. If the first warrant is exercised, the
Company's ownership interest in MicroHeart would increase to approximately
44%. If the second warrant is exercised the Company's interest in MicroHeart
would increase to approximately 53%. These percentage ownership interests
assume that the second warrant will not be cancelled and no further dilution
of MicroHeart will occur due to subsequent equity fund raising or other
activities of MicroHeart. There can be no assurance that these assumptions
accurately forecast future events.
The Company will record a $0.4 million investment and related gain on the
contributed technology based on the value of the MicroHeart common stock and
warrants received in exchange for the contributed technology and the
MicroHeart name. In addition, Eclipse has agreed to perform research and
development related to the contributed technology over the next year, for
which it will be paid $1.1 million by MicroHeart. Revenues associated with
this contract will be recognized as the research and development costs are
incurred.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
99.1 Press Release, dated November 23, 1998, entitled
"Eclipse Announces Investment in MicroHeart with U.S.
Venture Partners and Venrock Associates."
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: December 10, 1998 ECLIPSE SURGICAL TECHNOLOGIES, INC.
By: /s/ Kenneth E. Bennert
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Name: Kenneth E. Bennert
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Title: Vice-President & Chief Financial Officer
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
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<S> <C>
99.1 Press Release, dated November 23, 1998, entitled "Eclipse Announces Investment in
MicroHeart with U.S. Venture Partners and Venrock Associates."
</TABLE>
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Exhibit 99.1
ECLIPSE ANNOUNCES INVESTMENT IN
MICROHEART WITH U.S. VENTURE PARTNERS
AND VENROCK ASSOCIATES
Sunnyvale, CA, November 23, 1998 - Eclipse Surgical Technologies (Nasdaq:
ESTI) announced today that U.S. Venture Partners (Menlo Park, CA) and Venrock
Associates (New York, NY) have made a $5.5 million equity investment in
MicroHeart Holding, Inc. ("MicroHeart"), a Delaware corporation. Following
this investment, Eclipse contributed certain licenses, patents, and other
intellectual property related to MicroHeart's business in exchange for stock
and warrants in MicroHeart. In addition, Eclipse has agreed to perform
research and development activities over the next year, for which it will be
reimbursed by MicroHeart.
"We are pleased to collaborate with two of the top venture capital firms in
the country," said Dr. Douglas Murphy-Chutorian, Chairman and Chief Executive
Officer of Eclipse. "U.S. Venture Partners and Venrock Associates bring to
MicroHeart a wealth of experience in the biotechnology and medical device
industries."
Eclipse now owns less than 20% of the outstanding shares of MicroHeart. On a
fully diluted basis, if Eclipse were to exercise all of its warrants, Eclipse
would then own a majority position in MicroHeart.
MicroHeart designs and develops devices for drug delivery of growth factors
to promote angiogenesis in the heart. Myocardial revascularization utilizing
angiogenic drugs and growth factors is a nascent technology intended to
provide a new therapeutic approach to the treatment of coronary artery
disease and associated symptoms such as angina.
Eclipse is a medical device company specializing in cardiac revascularization
products for the treatment of advanced cardiovascular disease and severe
angina pain. The Company recently received FDA Advisory Panel recommendation
for approval of its TMR Laser System. Transmyocardial Revascularization
("TMR") and Percutaneous Transluminal Myocardial Revascularization ("PTMR")
are investigational laser heart treatments in which one millimeter channels
are made in the heart muscle with the intention of stimulating the growth of
new blood vessels to result in the reduction of angina
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pain. Eclipse must obtain PMA marketing clearance from the FDA before its
products for TMR or PTMR can be offered on a commercial basis in the United
States. For more information on the Company and its products, please visit
the Eclipse web site at http://www.eclipsesurg.com
Eclipse recently announced a proposed business combination with CardioGenesis
Corporation, with CardioGenesis shareholders to receive 0.8 of a share of
Eclipse stock for every share of CardioGenesis owned. The proposed
combination is subject to shareholder approval from both companies.
The forward looking statements in this news release related to the future
potential of angiogenic drug delivery technologies are based on current
expectations and beliefs and are subject to numerous risks and uncertainties
that could cause the actual results to differ materially. Other factors that
could cause actual Eclipse or MicroHeart results to differ materially include
uncertainties associated with clinical trials, no assurance of market
acceptance, potential third-party patent infringement claims and uncertainty
regarding production of proprietary technologies, uncertainty related to
consummation of Eclipse's proposed business combination with CardioGenesis
Corp., as well as additional risk factors, as discussed in the "Risk Factors"
section of Eclipse's Annual Report on Form 10-K dated December 31, 1997, and
Eclipse's quarterly reports filed with the U.S. Securities and Exchange
Commission (SEC).
Contacts:
Douglas Murphy-Chutorian, M.D., Chief Executive Officer, Kenneth
Bennert, Chief Financial Officer, or Tara Spangler Calhoun, Investor
Relations Director, Eclipse Surgical Technologies, Inc. (408) 747-0120
