Cambridge Heart Inc. (NSDQ:CAMB) streamlined its board of directors, choosing to replace three departing directors with a single, new board member with considerable industry experience and moving CFO Vincenzo LiCausi to part-time status.
In reducing the number of board seats from seven to five, company officials cited the need to speed decision-making at the Tewksbury-based cardiac device company.
The move comes soon after Cambridge Heart pulled in $1.85 million in new funding from the sale of convertible preferred stock. Three existing board members had financial stakes in the deal, with two remaining on the board and the third participating director stepping aside but remaining with the company in an advisory role.
Leaving the Cambridge Heart board are Richard Cohen, Kenneth Hachikian and Reed Malleck. Cohen, the founding scientific officer of the company, departs after a quarter-century run on the board, but is slated to chair a newly reformed scientific advisory panel and also will continue to work with the company as a part-time consultant. Cohen added to his 1.5 million-share stake in CAMH by buying $35,000 of the new Series D shares, which can be converted into more than 425,000 shares of common stock.
Neither Malleck nor Hachikian, both of whom have been on the board since 2004, opted to buy any Series D stock.
The new director is Paul McCormick, former CEO of Endologix Inc. (NSDQ:ELGX), an Irvine, Calif.-based manufacturer of minimally invasive vascular treatments. He also is a director at Cianna Medical Inc. and Cardiogenesis Inc. (OTC:CGCP), two device companies also based in California, as well as retaining a board seat at Endologix.
Other board members at Cambridge Heart are CEO Ali Haghighi-Mood and Roderick de Greef, head of strategic planning and execution, along with outside directors Jeffrey Wiggins and John McGuire.
LiCausi’s workload was reduced to 60 percent as of Jan. 1 “so that Mr. LiCausi can attend to personal matters,” according to a regulatory filing. His annual base salary was reduced accordingly, from $155,000 to $93,000.
Wiggins was a particularly aggressive buyer during the recent private placement, snapping up 315 Series D shares at $1,000 each, which would convert into 3.8 million common shares.
The private placement also attracted Vicente Madrigal, a private investor living in New York and the scion of a Filipino real estate and political dynasty.
Madrigal, a first-time investor in Cambridge Heart, bought $300,000 of the Series D shares, matching Saba Malak, a managing director at Putnam Investments, and Luis Martins of Fidelity Investments in their purchases. Both Malak and Martins were previous investors in Cambridge Heart and made their purchases separately from their respective positions at the investment firms.
Boston-based Osiris Investment Partners likewise had a $270,000 stake in the Dec. 23, 2009, financing and could eventually own up to 8.4 percent of the company if it fully exercises warrants included with the deal, according to securities documents filed Jan. 4.
De Greef bought a $50,000 stake, according to filings.