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AtriCure Announces Definitive Agreement to Acquire Estech



  AtriCure Announces Definitive Agreement to Acquire Estech

Business Wire

WEST CHESTER, Ohio -- December 19, 2013

AtriCure, Inc. (Nasdaq: ATRC), a leading Atrial Fibrillation (Afib) medical
device provider, and Endoscopic Technologies, Inc. d/b/a Estech (“Estech”),
today announced that they have entered into a definitive merger agreement
under which AtriCure has agreed to acquire Estech for a cash-free, debt-free
up-front payment of approximately 2.1 million shares or $34 million of
AtriCure common stock and up to $26 million in additional consideration based
on the achievement of certain revenue-based milestones. The transaction is
subject to customary closing conditions and is expected to close in the next
several weeks. AtriCure shareholder approval is not required.

Estech, a privately held company based in San Ramon, California, develops and
markets a portfolio of innovative surgical ablation devices that enable
physicians to perform a variety of traditional and minimally invasive
procedures using Estech’s proprietary temperature controlled RF energy.

“Estech is an ideal strategic fit for AtriCure, as it expands our presence and
reinforces our commitment to the atrial fibrillation market. The combination
of the two companies enhances AtriCure’s leadership and intellectual property
position across surgical ablation and epicardial left atrial appendage (LAA)
closure and accelerates the availability of broader surgical ablation
offerings through the combination of Estech’s sales and marketing and R&D
capabilities worldwide under the AtriCure umbrella,” said Mike Carrel,
President and Chief Executive Officer of AtriCure.

Mr. Carrel continued, “This acquisition demonstrates our commitment to
providing the most robust suite of products and solutions for our physician
customers to treat the broadest set of patients suffering from Afib and
Afib-related complications. Afib remains a large and growing market. Our
ongoing investments in R&D, physician education and training, clinical science
and commercial execution are major steps to capitalize on this market
opportunity.”

“Estech’s innovative surgical ablation portfolio is an excellent fit into
AtriCure’s market leading portfolio. Estech’s customers will be very well
served by AtriCure’s strong global sales and training presence and
demonstrated long-term commitment to Atrial Fibrillation and LAA management,”
said John Pavlidis, President and Chief Executive officer of Estech.

AtriCure expects that the transaction will increase sales and marketing
expense as well as research and development expenditures in order to
accelerate clinical development and commercial sales of the combined product
portfolio. While these expenses will increase on absolute dollar basis,
AtriCure expects these expenses to decrease as a percentage of sales beginning
in 2015. AtriCure expects the transaction to be dilutive to earnings in 2014
and accretive in 2015 and beyond.

Advisors

Piper Jaffray is acting as exclusive financial advisor, and Keating Muething &
Klekamp PLL is serving as legal counsel, to AtriCure. Leerink Swann is acting
as exclusive financial advisor, and DLA Piper LLP is serving as legal counsel,
to Estech.

About Estech

Estech develops and markets a portfolio of innovative medical devices that
enable cardiac surgeons to perform a variety of surgical procedures, while
specializing in minimally invasive and hybrid ablation. The company’s COBRA
line comprises a number of first‐ever ablation technologies invented,
developed, and brought exclusively to market by Estech. These include
temperature‐controlled RF energy delivery, Versapolar™ devices that provide
both bipolar and monopolar energy, suction‐applied tissue contact, and
internally‐cooled devices which provide superior ablation performance compared
to other ablation systems. For more information, please visit www.estech.com.

About AtriCure, Inc.

AtriCure, Inc. is a medical device company providing innovative atrial
fibrillation solutions designed to produce superior outcomes that reduce the
economic and social burden of atrial fibrillation. AtriCure’s Synergy Ablation
System is the first and only device approved for the treatment of Persistent
and Longstanding Persistent forms of Afib in patients undergoing certain open
concomitant procedures. AtriCure’s AtriClip Left Atrial Appendage (LAA)
exclusion device is the most widely implanted device for LAA management
worldwide. The company believes cardiothoracic surgeons are adopting its
ablation and LAA management devices for the treatment of Afib and reduction of
Afib related complications such as stroke. Afib affects more than 5.5 million
people worldwide.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of
the Private Securities Litigation Reform Act of 1995. Forward-looking
statements include statements that address activities, events or developments
that AtriCure expects, believes or anticipates will or may occur in the
future, such as earnings estimates (including projections and guidance), other
predictions of financial performance, launches by AtriCure of new products and
market acceptance of AtriCure’s products. Forward-looking statements are based
on AtriCure’s experience and perception of current conditions, trends,
expected future developments and other factors it believes are appropriate
under the circumstances and are subject to numerous risks and uncertainties,
many of which are beyond AtriCure’s control. These risks and uncertainties
include the rate and degree of market acceptance of AtriCure’s products,
AtriCure’s ability to develop and market new and enhanced products, the timing
of and ability to obtain and maintain regulatory clearances and approvals for
its products, the timing of and ability to obtain reimbursement of procedures
utilizing AtriCure’s products, AtriCure’s ability to consummate acquisitions
or, if consummated, to successfully integrate acquired businesses into
AtriCure’s operations, AtriCure’s ability to recognize the benefits of
acquisitions, including potential synergies and cost savings, failure of an
acquisition or acquired company to achieve its plans and objectives generally,
risk that proposed or consummated acquisitions may disrupt operations or pose
difficulties in employee retention or otherwise affect financial or operating
results, competition from existing and new products and procedures or
AtriCure’s ability to effectively react to other risks and uncertainties
described from time to time in AtriCure’s SEC filings, such as fluctuation of
quarterly financial results, reliance on third party manufacturers and
suppliers, litigation or other proceedings, government regulation and stock
price volatility. AtriCure does not guarantee any forward-looking statement,
and actual results may differ materially from those projected. AtriCure
undertakes no obligation to publicly update any forward-looking statement,
whether as a result of new information, future events or otherwise. A further
list and description of risks, uncertainties and other matters can be found in
our Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q.

Contact:

AtriCure, Inc.
Andy Wade, Vice President and Chief Financial Officer, 513-755-4564
awade@atricure.com
or
Investor Relations Contact
Westwicke Partners
Lynn Pieper, 415-202-5678
lynn.pieper@westwicke.com
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