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Vantus Manufacturing Corp Systems PDF Print E-mail
Written by ARC   
Wednesday, 24 March 2010 16:48
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NOTICE OF AVAILABILITY OF $100,000,000 OF CLASS C SHARES OF STOCK IN VANTUS MANUFACTURING CORPORATION SYSTEMS

Vantus Manufacturing Corporation Systems, a Wisconsin corporation (“Vantus Manufacturing”), is pleased to announce the availability for investment of $100,000,000 of Class C shares of stock in Vantus Manufacturing. There are 2 key features to an investment in Vantus Manufacturing – (1) qualification for the “EB-5 program” (the “EB-5 Program”) of the United States Citizenship and Immigration Services (“USCIS”), and (2) participation in a personalized orthopedic medical device business (the “Business”).

 

The EB-5 Program
Under the EB-5 Program, non-United States investors who make a “qualified investment” in certain United States businesses can obtain a “green card”, or “permanent resident” status, in the United States. The EB-5 Program is often referred to as “immigration through investment”, because it enables non-United States persons to obtain a “green card” in the United States simply by making a “qualified investment” in certain United States businesses, thereby avoiding many of the restrictions presently applicable to foreigners attempting to immigrate to the United States. Under the EB-5 Program, foreigners can obtain a “green card” for themselves, their spouses, and their unmarried children under the age of 21.
Vantus Manufacturing will be located in Waukesha, Wisconsin, which is part of a “USCIS-designated regional center” (sponsored and administered by the Metropolitan Milwaukee Association of Commerce). It is easier to meet the requirements of a “qualified investment” under the EB-5 Program when the United States business is located in a “USCIS-designated regional center”. Chuhak & Tecson, P.C., of Chicago, Illinois, immigration law counsel to Vantus Manufacturing, will issue an opinion letter that an investment of at least $1,000,000 in Vantus Manufacturing will constitute a “qualified investment” under the EB-5 Program.
The Business
Vantus Manufacturing will license from Vantus Technology Corporation, a Wisconsin corporation (“Vantus Technology”), certain rights to the “Vantus Digital Manufacturing System” (“VDMS”). VDMS is a proprietary systems approach to the design and production of “Personalized Orthopaedic Solutions”, which includes personalized implants and surgical instrumentation. VDMS has been developed by Vantus Technology since 2004 in collaboration with Medical College of Wisconsin, Rush University Medical Center, University of Wisconsin – Madison, Walter Reed Army Medical Center, and National Naval Medical Center. VDMS integrates medical imaging, quantitative image analysis, computer-aided design, computer-aided manufacturing, computer-aided engineering, telemedicine, virtual design collaboration, virtual design simulation and validation, informatics, robotic surgery, mass-customization production, and additive manufacturing technology, to produce “Personalized Orthopaedic Solutions”. VDMS offers 3 advantages over traditional orthopaedic medical devices that are presently in use today –(i) a better fitting product for the patient’s anatomy that is designed to minimize problems associated with joint and bone misalignment, loosening of the device, and revision surgery, (ii) a product which is designed to accommodate the lifestyle and function of each patient (e.g., a 40 year old golfer or tennis player who needs a total knee replacement vs. an 85 year old person who is less active in activity), and (iii) a faster delivery of the product to the patient, by generally producing personalized implants and surgical instrumentation within 48 hours. Vantus Technology has filed for comprehensive patent protection for VDMS. “Vantus Digital Manufacturing System” and “Personalized Orthopaedic Solutions” are trademarks of Vantus Technology.
Pursuant to the rights that it licenses from Vantus Technology, Vantus Manufacturing will use VDMS to market, manufacture, and sell personalized orthopaedic medical devices. Vantus Manufacturing intends to sell personalized orthopaedic medical devices to public and private sector customers in 3 primary markets – (I) orthopaedic reconstruction, (II) fracture repair, and (III) surgical instrumentation. The initial sales strategy of Vantus Manufacturing is direct sales of personalized orthopaedic medical devices to Federal agency medical care decision makers, academic institution partners and collaborators, and hospital systems; by proving the application of VDMS in these environments, Vantus Manufacturing hopes to increase market demand in the future.
Vantus Manufacturing believes that there is no commercial orthopaedic medical device manufacturer in the market today which produces personalized orthopaedic medical devices that could compete with the personalized orthopaedic medical devices to be sold by Vantus Manufacturing. The leading commercial orthopaedic medical device manufacturers today do not dedicate significant resources to custom orthopaedic medical devices. Their traditional, standard-sized orthopaedic medical devices that “kind of fit” patients (and surgeons) cannot compete with the personalized orthopaedic medical devices of Vantus Manufacturing that “exactly fit” patients (and surgeons). Vantus Manufacturing also intends to sell its personalized orthopaedic medical devices at prices comparable to that offered for traditional, standard-sized orthopaedic medical devices.
Vantus Manufacturing will also purchase and lease to Vantus Technology certain lab equipment, which will be used by Vantus Technology to further develop the VDMS technology.
The founder of Vantus Technology and President of Vantus Management is James Schroeder. Mr. Schroeder has earned an MBA degree from Marquette University. Mr. Schroeder has over 25 years of experience in digital product development, advanced manufacturing systems, CAD/CAM/CAE and PDM/ERP/MES technologies, production tooling, and professional business management. Vantus Technology and Vantus Manufacturing have assembled a “Science Advisory Group”, consisting of various doctors and professors with specializations in orthopaedic surgery and biomedical engineering.
Vantus Technology has previously received financing from the Wisconsin Department of Commerce and the United States Department of Defense. Vantus Technology and Vantus Manufacturing are presently pursuing financing from the National Institutes of Heath and the United States Department of Veterans Affairs.
The Investment
Among the key features of an “EB-5/Class C” investment in Vantus Manufacturing are as follows:
1. The “EB-5/Class C” investors will own all of the Class C shares of stock in Vantus Manufacturing. James Schroeder will own all of the Class A shares of stock in Vantus Manufacturing (which will always represent a majority interest in Vantus Manufacturing). Key management persons will own all of the Class B shares of stock in Vantus Manufacturing. In addition, “venture capital” or other “non-EB-5” investors will own all of the Class D shares of stock in Vantus Manufacturing (subject to the rights of “EB-5” investors described below). The profits and cash flow of Vantus Manufacturing will be allocated 51% to the Class A shareholders, 15% to the Class B shareholders, and 34% collectively between the Class C shareholders and the Class D shareholders. Except with respect to the Class C shares of stock to the extent necessary to make the investment a “qualified investment” under the EB-5 Program, the Board of Directors of Vantus Manufacturing may redeem any Class B, Class C, or Class D shares of stock at any time for payment of thegreater of (a) the fair market value of such shares of stock (with respect to the Class C shares of stock, only applicable after 5 years of the initial date of investment), or (b) with respect to the Class C shares of stock, the remaining unpaid Payout Complete Distribution rights.
2. The “EB-5/Class C” investors shall be entitled to a 5% cumulative annual rate of return from the initial date of investment. Vantus Manufacturing anticipates that it will be able to distribute to the “EB-5/Class C” investors cash flow in the aggregate amount of their investments, plus the above-described 5% cumulative annual rate of return (“Payout Distribution”), within 5 years of the initial date of investment (most likely, from the proceeds of an “initial public offering”). Alternatively, at the time of Payout Distribution, any “EB-5/Class C” investor may elect to waive such investor’s remaining Payout Distribution rights and instead exercise such investor’s option to become a Class D shareholder of Vantus Manufacturing (owning shares of Class D stock equal in amount to such investor’s remaining Payout Distribution rights). In addition, if Vantus Manufacturing is unable to be able to offer Payout Distribution for any investor within 5 years of the initial date of investment, such investor then either (a) shall have the right to transfer such investor’s shares of Class C stock to a third party, or (b) shall be granted a 3% future increase on the cumulative annual rate of return for the investment (thereby increased to an 8% cumulative annual rate of return).
3. Most “EB-5” investments charge the investor a $35,000 to $60,000 “syndication fee” in addition to the amount of the actual investment. Vantus Manufacturing will reduce this “syndication fee” and charge only a $20,000 “syndication fee” for each $1,000,000 of “EB-5/Class C” investment.
4. The business and affairs of Vantus Manufacturing generally will be managed by its Board of Directors and officers. As a result, an “EB-5/Class C” investor generally will have a limited voice or involvement in the management of Vantus Manufacturing only to the extent necessary to make the investment a “qualified investment” under the EB-5 Program. The “EB-5/Class C” investors will be entitled to vote on certain matters - (a) dissolution and winding up of Vantus Manufacturing, (b) merger of Vantus Manufacturing, (c) sale, exchange, or lease of all or substantially all of the assets of Vantus Manufacturing, (d) indebtedness or creditors of Vantus Manufacturing, (e) changing the nature of the business of Vantus Manufacturing, (f) changing the jurisdiction of or applicable to Vantus Manufacturing, (g) resolving conflicts of interest with the shareholders of Vantus Manufacturing, (h) continuing the business of Vantus Manufacturing in another entity following the dissolution of Vantus Manufacturing, (i) electing the Board of Directors of Vantus Manufacturing, (j) voting on the removal of a Board of Director member of Vantus Manufacturing, and (k) approving transfers of shares of stock in Vantus Manufacturing.
5. While Vantus Manufacturing will sell a maximum investment amount of $100,000,000 of Class C shares of stock, Vantus Manufacturing, in its sole discretion, may sell a minimum investment amount of $10,000,000 of Class C shares of stock.
Last Updated on Thursday, 20 May 2010 17:17
 

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