Slater Technology Fund Completes Record Year and Obtains Renewed Funding

$2.3 million in financing transactions completed with 10 technology-based ventures
Additional $1.2 million in financings approved and pending completion
Portfolio companies achieve significant progress

Providence, R.I., July 17, 2006 – Slater Technology Fund today announced highlights for fiscal 2006, which included a record level of funding commitments and significant progress achieved by a number of its portfolio companies. In addition, Slater announced that funding for its next fiscal year was renewed at the same level as that received in prior years.

During the fiscal year that ended June 30, 2006, Slater completed or approved a total of $3.5 million in funding commitments to 16 technology-based ventures. Of this amount, $2.3 million in financing transactions were completed during the fiscal year, and $1.2 million were approved and remain subject to completion pending satisfaction of various conditions to closing. This represents the highest level of funding commitments in any year since the Slater Fund’s inception in 1997.

For the fiscal year commencing July 1, 2006, Slater’s funding from the State of Rhode Island, which is made by annual appropriation from the General Assembly, was renewed in amount of $3 million. Such amount was originally proposed in the budget submitted by Governor Carcieri in January, 2006 and was approved by the General Assembly in the budget enacted in June, 2006. It represents the 10th year of a sustained commitment on the part of the State of Rhode Island in support of the Slater Technology Fund.

Slater provides seed capital to new ventures to catalyze the creation of technology-based businesses in Rhode Island. Slater focuses its resources on industry sectors deemed particularly well-suited to developing an innovation-based economy in Rhode Island, including biomedical technology, information technology/communications, and marine, environmental and energy.

“This has been an eventful and encouraging year for Slater,” said Richard G. Horan, senior managing director of the Slater Technology Fund. “A primary goal was to improve the operational efficiency of the fund by reducing overhead spending and increasing the amount of State funding devoted to direct investment in R.I.-based ventures. We’ve made great progress in this regard. Against this backdrop, it is most gratifying to see the continued support from the Governor and the General Assembly.”

According to Saul Kaplan, Executive Director of the R.I. Economic Development Corp. and Chairman of Slater’s Board of Directors, “It is becoming increasingly clear what a significant impact entrepreneurship is having in developing an innovation-based economy here in Rhode Island. The Slater Fund is an integral part of the overall strategy being pursued.”

Fiscal 2006 Commitments

Companies receiving initial or follow-on funding commitments from Slater during the past year included:

• Analytical Edge, Inc. – launched in collaboration with bio-statisticians at Brown University and Johns Hopkins University, the company is developing software and services to improve the design, conduct and analysis of clinical trials undertaken by pharmaceutical and medical device companies.

• Andera Software, Inc. – founded by graduates from Brown University, the company has developed and commercialized web-based solutions for banks and credit unions.

• Concordia Fibers, LLC – an established textile manufacturer located in Coventry, R.I., the company develops and manufactures specialty fibers for applications in biomedical products, authentication and other high value market opportunities.

• Creative Circle Advertising Solutions, Inc. – incubated within the Center for Design & Business, the company recently launched an innovative, Web-entry system for classified advertising, applicable in both print-based and broadcast markets.

• Ion Signature Technology, Inc. – originating at Tufts University and recently relocated from Massachusetts to North Smithfield, R.I., the company is developing advanced data analysis software for analytical laboratories.

• Myomics Inc. – originating from the division of engineering at Brown University, the company is developing proprietary technology platforms for high content/high throughput screening in drug discovery and pharmaceutical research.

• NABsys, Inc. – originating from the department of physics at Brown University, the company is developing nanopore-based arrays for bio-analytical applications, aiming to commercialize a breakthrough technology for DNA sequencing.

• ProThera Biologics, LLC – originating within research labs at Lifespan/Rhode Island Hospital, the company is developing diagnostic and therapeutic products based on natural serine protease inhibitors for treatment of sepsis and other life-threatening conditions.

• Public Display, Inc. – co-founded by a team of R.I.-based, serial entrepreneurs, the company is developing Web-based groupware designed to organize the family.

• RightPath Payments, Inc. – recently relocated from Massachusetts to Providence, the company has developed a Web-based, business-to-business payment and trade finance solution.

• Selva Medical, Inc. – relocating operations from Boston, Massachusetts and Belmont, California to Tiverton, R.I., the company is developing a breakthrough method for use in treating stroke and other cardiovascular conditions.

• Solaris NanoSciences, Inc. – a spin-out from Spectra Systems Inc., a technology development firm founded by a former professor of engineering at Brown University, the company is developing a proprietary solar cell technology.

• Sonic Works, Inc. – relocated from Massachusetts to Portsmouth, R.I., the company is developing underwater surveillance systems using acoustic signal processing technology.

• Traction Software, Inc. – founded by graduates of Brown University, the company has developed and commercialized a leading enterprise Weblog software system, which has won numerous industry awards.

• VitriMark, Inc. – originating from URI’s College of Engineering, the company is developing a proprietary cryo-imaging system for use in biomarker discovery.

Portfolio Company Progress

A number of Slater-backed companies achieved significant progress during the year, including fund-raising from outside sources, recruiting key people, advancing research and development, and commercializing new products and services. In many cases, Slater played a meaningful role in accomplishing key milestones. Examples are highlighted below:

Advanced Image Enhancement, Inc. (AIE), a software company producing optimized image enhancement tools for digital radiology, completed a pilot clinical study utilizing its proprietary image enhancement technology in conjunction with digital mammography, demonstrating significant improvement in breast cancer screening.

Afferent Corp., a neurotechnology-based medical device company focused on treating chronic neurologic dysfunction, successfully recruited a seasoned industry veteran — former Johnson & Johnson division president David Hable — to serve as the company’s president and CEO.

Andera Software Inc. saw revenues in 2005 increase by more than 200% over the previous year and contract bookings increase by 800% over the same period. Also expanded its management team, more than doubled its workforce to 20 full-time employees, and established strategic alliances with industry leaders such as Fiserv and eFunds.

Concordia Fibers, LLC acquired two Massachusetts-based businesses, both relocated to Rhode Island, successfully recruited an industry veteran as EVP-Medical Products, completed a multi-year funded development contract with a major medical products company, and raised over $900K in debt, equity and grant funding.

Creative Circle Advertising Solutions, Inc. raised a round of funding from Cherrystone Angel Group, Walnut Venture Associates and others to expand its staff and ramp up operations. The company also launched adQ, its innovative, classified advertising system, with its first broadcast client, NBC 10 in Rhode Island.

Cyberkinetics Neurotechnology Systems, Inc., a leader in the emerging field of neurotechnology, had scientific findings from the company’s ongoing pilot clinical trials of the BrainGate System featured on the cover of the prestigious scientific journal, Nature, in the July 13, 2006 issue.

EpiVax Inc., a pioneer in the field of computational immunology, was awarded $2.2 million in SBIR funding from NIH and completed a multi-year, multi-million dollar funded development contract with a major pharma company.

Ion Signature Technology, Inc. (IST) signed a strategic partnership with Shimadzu, a leading global supplier of analytical instrumentation and completed a $550K round of equity financing.

Modular Energy Devices Inc. (ModEnergy), a developer of lithium-ion battery systems, received significant funding from EnerSys, the world’s largest supplier of industrial batteries. EnerSys’ investment in ModEnergy will enable the company to expand its product development and manufacturing capabilities as well as pursue a wider range of new applications for its technologies.

NABsys Inc. Co-founder, Prof. Xinsheng “Sean” Ling received a $1.6-million grant from the National Science Foundation to fund research at Brown University, a license to which NABsys holds exclusive rights. The company also appointed Barrett Bready, M.D., a recent graduate from Brown Medical School, as its president and CEO.

Neurotech Inc. completed a successful Phase I clinical trial on its lead product, a treatment for retinitis pigmentosa, the results of which were published in the prestigious journal Proceedings of the National Academy of Sciences. In addition, the company initiated a Phase II clinical trial on the same product in age-related macular degeneration.

ProThera Biologics LLC announced grant awards from NIH in excess of $3.0 million, to advance clinical development of its lead product in treatment of sepsis and anthrax intoxication.

Sonic Works Inc. was selected as the premier underwater inspection technology for four harbor security contracts.

TAZZ Networks Inc. entered a major partnership agreement with industry giant, Cisco Systems, to market its policy control solution as the Cisco Broadband Policy Manager.

About Slater Technology Fund
The Slater Technology Fund supports the development of emerging industries with potential for significant long-term growth within the State of Rhode Island. Slater focuses its resources on the support of entrepreneurs who have the vision, leadership and commitment to build substantial commercial enterprises. Slater typically invests at the inception stage in the development of a new venture, often based upon ideas and technologies originating in academic institutions and/or government research laboratories located within the region. In most cases, investments are premised upon the possibility of raising substantial follow-on financing, from venture capital investors or from strategic partners, with a view toward accelerating the generation of significant numbers of high-value, high-wage jobs over the intermediate to longer-term.

For More Information
Laura Nelson
SVM Public Relations
(401) 490-9700
laura.nelson@svmpr.com