NEW YORK (GenomeWeb News) – Helicos BioSciences, currently in Chapter 11 bankruptcy protection, is seeking approval from bankruptcy court to sell its assets to an employee who plans to form a new company using Helicos' technology, the company said in a court filing last week.
The US Bankruptcy Court for the District of Massachusetts Eastern Division will hold a hearing on Helicos' motion for approval of the proposed deal on Thursday.
According to the motion, Helicos employee Dan Jones wants to buy the company's assets. He also is seeking a non-exclusive license from Helicos covering its technology in order to build a new entity that will perform sequencing services on a contract basis in support of Helicos' existing customer base "and potentially improving [Helicos'] existing technology."
Jones, Helicos said, is a scientist and has never served as a director or officer of the company.
Among the assets that Jones would acquire are Helicos' equipment, including its HeliScope single-molecule sequencers, data analysis systems, and engineering computers; all inventory and supplies including reagents; and all customer records and engineering documentation.
Helicos would also grant Jones a sublicense to its IP, originally licensed from Arizona Science and Technology Enterprise, related to nucleic acid sequencing-by-synthesis "utilizing detection of optical-labeled nucleotides … and performed without reliance on detection of optically labeled nucleotides," the firm said.
Under the terms of the deal, Jones would make an initial payment to Helicos of $75,000. The company would also issue a promissory note in the principal amount of $500,000 with a non-default interest rate of 3 percent "secured by a second priority security interest in all assets acquired" from Helicos by Jones.
Jones would have to carry out Helicos' unfulfilled customer orders and deferred customer obligations "whether [he] will realize any revenue therefrom (and in most cases, [Jones] will not)," according to the filing.
Jones would have the rights to use the Helicos and Helicos BioSciences name in connection with the new business.
Helicos said that two of the three claimants on its bankruptcy filing asserting liens against Helicos' assets have agreed to the deal, while the third "has expressed no objection to the [company's] request for expedited determination or relief requested herein."
Helicos must vacate its current location in Cambridge, Mass., by the end of the month, and "[t]he purpose of the transaction is to relieve the company of assets and obligations that will constitute a net drain on the company's cash flow if retained after March 31, 2013," the firm said in its court document.
Helicos filed for Chapter 11 protection, which allows a company to reorganize its operations, in November after its board determined "that continued operation of the company outside of bankruptcy protection is not possible due to its lack of cash resources and no available funding operations."
In its bankruptcy filing, the company listed total assets of $3.5 million and total debts of $15.5 million as of Sept. 30, 2012.