Exhibit (d)(4)
CONFIDENTIAL
January 9, 2017
Mr. Zubeen Shroff
Galen Partners III, L.P.
Galen Partners International III, L.P.
Galen Employee Fund III, L.P.
680 Washington Boulevard
11th Floor
Stamford, CT 06901
| Re: | Potential Merger |
Dear Zubeen:
We are writing to Galen Partners III, L.P., Galen Partners International III, L.P. and Galen Employee Fund III, L.P. (collectively, the “Galen Partnerships”) in their capacities as holders of our Series A and B preferred stock. We are in preliminary discussions with Integra LifeSciences Holdings Corporation, whereby Integra would purchase all of the issued and outstanding common and preferred shares of Derma Sciences for $6.75-$7.00 per share. The transaction would be effected by way of a tender offer for all of the issued and outstanding common and preferred shares (the “Offer”), followed by a merger if necessary to complete the purchase of the remaining common and preferred shares (the “Merger”).
The Galen Partnerships would be entitled to liquidation preferences upon consummation of the Merger as set forth in the table below:
Galen Partnerships
Liquidation Preferences
Shareholders | Preferred Class | Shares Owned | Per Share Liquidation Preference | Total Liquidation Preference | ||||||||||||
Galen Partners III, L. P. | A | 14,190 | $ | 32.00 | $ | 454,080.00 | ||||||||||
Galen Partners International, III, L.P. | A | 1,374 | $ | 32.00 | 43,968.00 | |||||||||||
Galen Employee Fund III, L.P. | A | 63 | $ | 32.00 | 2,016.00 | |||||||||||
|
|
|
| |||||||||||||
Total – Series A | 15,627 | $ | 500,064.00 | |||||||||||||
|
|
|
| |||||||||||||
214 Carnegie Center, Suite 300, Princeton, NJ, 08540
P: 609-514-4744 F: 609-514-8554
www.dermasciences.com
Mr. Zubeen Shroff
Galen Partners III, L.P.
Galen Partners international III, L.P.
Galen Employee Fund III, L.P.
January 9, 2017
Page 2
Galen Partnerships
Liquidation Preferences
Shareholders | Preferred Class | Shares Owned | Per Share Liquidation Preference | Total Liquidation Preference | ||||||||||||
Galen Partners III, L. P. | B | 47,299 | $ | 48.00 | $ | 2,270,352.00 | ||||||||||
Galen Partners International, III, L.P. | B | 4,578 | $ | 48.00 | 219,744.00 | |||||||||||
Galen Employee Fund III, L.P. | B | 208 | $ | 48.00 | 9,984.00 | |||||||||||
|
|
|
| |||||||||||||
Total – Series B | 52,085 | $ | 2,500,080.00 | |||||||||||||
|
|
|
| |||||||||||||
Total – Series A and B | 67,712 | $ | 3,000,144.00 | |||||||||||||
|
|
|
| |||||||||||||
The Merger is subject to the approval of the holders of a majority of the Series A and Series B preferred shares voting by class. Accordingly, Derma Sciences will not entertain the Merger unless it receives the subject approvals.
Please note that the dissemination to any persons of information concerning the Merger is governed by the Securities Act of 1933, the Securities Act of 1934 and rules and regulations thereunder, together with state securities laws and regulations.
If the Galen Partnerships wish to consent to the Merger, tender their preferred shares in the Offer and, upon consummation thereof, receive the subject liquidation preference in exchange for their preferred shares, kindly so signify by signing in the space indicated. By signing in the space indicated, the Galen Partnerships agree to tender into the Offer all of their Series A preferred shares in exchange for $32.00 per share and all of their Series B preferred shares in exchange for $48.00 per share.
Very truly yours,
DERMA SCIENCES, INC.
Stephen T. Wills, CPA, MST
Executive Chairman
THE MERGER IS APPROVED AND THE LIQUIDATION PREFERENCE IS ELECTED.
APPROVAL IS SUBJECT TO THE MERGER BEING COMPLETED BY JULY 31, 2017.
GALEN PARTNERS III, L.P.
GALEN PARTNERS INTERNATIONAL III, L.P.
GALEN EMPLOYEE FUND III, L.P.
| By: | /s/ Zubeen Shroff | |
| Mr. Zubeen Shroff | ||
| Managing Director | ||
214 Carnegie Center, Suite 300, Princeton, NJ, 08540
P: 609-514-4744 F: 609-514-8554
www.dermasciences.com