UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934

Filed by the Registrant

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Filed by a party other than the Registrant

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Check the appropriate box:

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Preliminary Proxy Statement

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Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

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Definitive Proxy Statement

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Definitive Additional Materials

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Soliciting Material under §240.14a-12

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CAS MEDICAL SYSTEMS, INC.

(Name of Registrant As Specified In Its Charter)

N/A

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

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No fee required.

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Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

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(1)

Title of each class of securities to which transaction applies: (a) shares of CASMED common stock, par value $0.004 per share; (b) shares of CASMED Series A Convertible Preferred Stock, par value $0.001 per share; (c) shares of CASMED Series A Exchangeable Preferred Stock, par value $0.001 per share.

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(2)

Aggregate number of securities to which transaction applies: (a) 29,263,989 shares of CASMED common stock (including shares in respect of restricted stock awards); (b) 3,245,750 shares of CASMED common stock reserved and available for issuance upon exercise of stock options; (c) 472,782 shares of CASMED common stock reserved and available for issuance upon exercise of warrants; (d) 36,074 shares of CASMED common stock reserved and available for issuance pursuant to the CASMED Employee Stock Purchase Plan; (e) 6,834,568 shares of CASMED common stock reserved for issuance upon conversion of Series A Convertible Preferred Stock; and (f) 3,924,527 shares of CASMED common stock reserved for issuance upon conversion of Series A Exchangeable Preferred Stock.

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(3)

Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): Solely for the purpose of calculating the filing fee, the underlying value of the transaction was calculated based on the sum of: (a) 29,263,989 shares of CASMED common stock (including shares in respect of restricted stock awards) multiplied by $2.45 per share; (b) 3,027,750 shares reserved and available for issuance upon exercise of stock options with exercise prices equal to or less than $2.45 per share multiplied by $0.76 per share (which is equal to the difference between $2.45 and $1.69, the weighted average exercise price of such options); (c) 218,000 shares reserved and available for issuance upon exercise of stock options with exercise prices greater than $2.45 per share multiplied by $0.10 per share; (d) 472,782 shares reserved and available for issuance upon exercise of warrants to purchase CASMED common stock multiplied by $1.06 per share (which is equal to the difference between $2.45 and $1.39, the weighted average exercise price of such warrants); (e) 36,074 shares of CASMED common stock reserved for issuance pursuant to the CASMED Employee Stock Purchase Plan multiplied by $2.45 per share; (f) 6,834,568 shares of CASMED common stock reserved for issuance upon conversion of Series A Convertible Preferred Stock multiplied by $2.45 per share; and (g) 3,924,527 shares of CASMED common stock reserved for issuance upon conversion of Series A Exchangeable Preferred Stock multiplied by $2.45 per share. The filing fee was determined by multiplying 0.0001212 by the proposed maximum aggregate value of the transaction of  $100,968,976.02.

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(4)

Proposed maximum aggregate value of transaction: $100,968,976.02

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(5)

Total fee paid: $12,237.44

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Fee paid previously with preliminary materials.

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Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

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(1)

Amount Previously Paid:    
   

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Form, Schedule or Registration Statement No.:    
   

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Filing Party:    
   

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(4)

Date Filed:   
   

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PRELIMINARY PROXY STATEMENT — SUBJECT TO COMPLETION, DATED
MARCH 1, 2019

CAS MEDICAL SYSTEMS, INC.
44 East Industrial Road
Branford, Connecticut 06405
(203) 488-6056

[•], 2019

Dear Stockholder:

We cordially invite you to attend the special meeting of stockholders of CAS MEDICAL SYSTEMS, INC. (“CASMED”), which will be held at CASMED’s corporate offices located at 44 East Industrial Road,
Branford, Connecticut 06405 at 10:00 a.m. Eastern Time on [•], 2019.

On February 11, 2019, CASMED, Edwards Lifesciences Holding, Inc. (“Edwards”) and Crown Merger Sub, Inc., a wholly owned subsidiary of Edwards (“Merger Sub”), entered into an Agreement and Plan of Merger pursuant to which, subject to the satisfaction or waiver of the conditions set forth therein, Merger Sub will merge with and into Edwards, with CASMED continuing as the surviving company and a wholly-owned subsidiary of Edwards.

At the special meeting, you will be asked to consider and vote upon:

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a proposal to adopt the Agreement and Plan of Merger, dated as of February 11, 2019, by and among CASMED, Edwards, and Merger Sub;

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a proposal to adjourn the special meeting, if necessary, to solicit additional proxies if there are insufficient votes at the time of the special meeting to adopt the merger agreement; and

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a non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger.

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If the merger is completed, you will be entitled to receive $2.45 in cash, without interest or dividend thereon and less any applicable withholding taxes, for each share of CASMED common stock you own as of the date of the merger (unless you have properly exercised and perfected and not lost or withdrawn your appraisal rights under Delaware law with respect to such shares), which represents a premium of approximately: (1) 56.1% to the closing price of CASMED’s common stock on February 11, 2019, the last full trading day prior to public announcement of CASMED’s entry into the merger agreement; and (2) 25.6% to the 365-day volume weighted average price, ended on February 11, 2019.

After careful consideration, our board of directors, by unanimous vote, approved and declared advisable the execution, delivery and performance of the merger agreement and the transactions contemplated by the merger agreement, including the merger, and determined that entering into the merger agreement and consummating the merger are in the best interests of CASMED’s stockholders. Accordingly, our board of directors recommends that you vote “FOR” the proposal to adopt the merger agreement, “FOR” the proposal to adjourn the special meeting, if necessary, and “FOR” the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger.

The holders of our Series A Convertible Preferred Stock and Series A Exchangeable Preferred Stock, which we refer to herein collectively as CASMED preferred stock, have agreed to convert their CASMED preferred stock into CASMED common stock prior to closing of the merger and will thereupon receive the same per share consideration payable to the CASMED common stockholders.

In connection with the execution of the merger agreement, Edwards entered into separate voting agreements (which we refer to collectively, as the voting agreements), with each of the holders of our CASMED preferred stock, and each of our executive officers and non-employee directors, pursuant to which, among other matters, they each agreed to vote the shares of CASMED stock held by each of them

in favor of the adoption of the merger agreement and the approval of the merger. The stockholders who are parties to the voting agreements collectively hold, as of February 11, 2019, (i) 100% of the Series A Convertible Preferred Stock, (ii) 100% of the Series A Exchangeable Preferred Stock and (iii) 26.1% of the voting power of the CASMED common stock, Series A Convertible Preferred Stock and Series A Exchangeable Preferred Stock voting as a single class.

The proxy statement accompanying this letter provides you with detailed information about the proposed merger and the special meeting of stockholders to vote on the adoption of the merger agreement. We encourage you to read the entire proxy statement and the merger agreement carefully. A copy of the merger agreement is attached as Annex A to the accompanying proxy statement. You may also obtain more information about CASMED from documents we have filed with the Securities and Exchange Commission.

Your vote is very important, regardless of the number of shares of stock that you own. The merger cannot be completed unless the merger agreement is adopted by the affirmative vote (in person or by proxy) of  (i) the holders of a majority of the aggregate voting power of  (x) the outstanding shares of CASMED common stock and (y) the Series A Convertible Preferred Stock and the Series A Exchangeable Preferred Stock, voting together as a single class, (ii) the holders of a majority of the outstanding shares of Series A Convertible Preferred Stock, voting separately as a class, and (iii) the holders of a majority of the outstanding shares of Series A Exchangeable Preferred Stock, voting separately as a class. If you fail to vote on the proposal to adopt the merger agreement, the effect will be the same as a vote “AGAINST” the adoption of the merger agreement. If you hold your shares in “street name,” the failure to instruct your bank, broker or other nominee on how to vote your shares of CASMED common stock will have the same effect as a vote “AGAINST” the adoption of the merger agreement.

IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED, EVEN IF YOU DO NOT PLAN ON ATTENDING THE SPECIAL MEETING IN PERSON. ACCORDINGLY, WE URGE YOU TO VOTE BY COMPLETING, SIGNING, DATING AND PROMPTLY RETURNING THE ENCLOSED PROXY CARD IN THE ENVELOPE PROVIDED, OR YOU MAY VOTE THROUGH THE INTERNET OR BY TELEPHONE AS DIRECTED ON THE ENCLOSED PROXY CARD. IF YOU RECEIVE MORE THAN ONE PROXY CARD BECAUSE YOU OWN SHARES THAT ARE REGISTERED DIFFERENTLY, PLEASE VOTE ALL OF YOUR SHARES SHOWN ON ALL OF YOUR PROXY CARDS.

On behalf of your board of directors, thank you for your continued support.

Sincerely,

Thomas M. Patton
President and Chief Executive Officer

PLEASE COMPLETE, SIGN, DATE AND RETURN THE ENCLOSED PROXY PROMPTLY.

This proxy statement is dated [•], 2019 and is first being mailed to stockholders on or about [•], 2019.

PRELIMINARY PROXY STATEMENT — SUBJECT TO COMPLETION, DATED
MARCH 1, 2019

CAS MEDICAL SYSTEMS, INC.
44 East Industrial Road
Branford, Connecticut 06405

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON [•], 2019

To the Stockholders of CAS MEDICAL SYSTEMS, INC.:

Notice is hereby given that a special meeting of stockholders of CAS MEDICAL SYSTEMS, INC., a Delaware corporation (“CASMED”), will be held at CASMED’s corporate offices located at 44 East Industrial Road, Branford, Connecticut 06405 at 10:00 a.m. Eastern Time on [•], 2019, for the following purposes:

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to consider and vote upon a proposal to adopt the Agreement and Plan of Merger, dated as of February 11, 2019, by and among CASMED, Edwards Lifesciences Holding, Inc., a Delaware corporation (“Edwards”) and Crown Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Edwards (“Merger Sub”);

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to consider and vote upon a proposal to adjourn the special meeting, if necessary, to solicit additional proxies if there are insufficient votes at the time of the special meeting to adopt the merger agreement; and

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to consider and vote upon a non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger.

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After careful consideration, our board of directors, by unanimous vote, has approved and declared advisable the execution, delivery and performance of the merger agreement and the transactions contemplated by the merger agreement, including the merger, and has determined that entering into the merger agreement and consummating the merger, are in the best interests of the Company’s stockholders.

OUR BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE “FOR” THE ADOPTION OF THE MERGER AGREEMENT, “FOR” THE PROPOSAL TO ADJOURN THE SPECIAL MEETING, IF NECESSARY, AND “FOR” THE NON-BINDING ADVISORY PROPOSAL TO APPROVE THE GOLDEN PARACHUTE COMPENSATION PAYABLE TO CASMED’S NAMED EXECUTIVE OFFICERS IN CONNECTION WITH THE MERGER.

Only stockholders of record of CASMED common stock, Series A Convertible Preferred Stock, and Series A Exchangeable Preferred Stock at the close of business on [•], 2019, the record date for the special meeting, are entitled to notice of and to vote at the special meeting and at any adjournment or postponement of the special meeting. A list of stockholders entitled to vote at the special meeting will be available for inspection by stockholders of record for any purpose germane to the special meeting during business hours at CASMED’s corporate offices located at 44 East Industrial Road, Branford, Connecticut 06405 for at least ten days prior to the date of the special meeting and will also be available at the special meeting.

Your vote is very important, regardless of the number of shares of stock that you own. The adoption of the merger agreement requires the affirmative vote (in person or by proxy) of  (i) the holders of a majority of the aggregate voting power of the outstanding shares of  (x) CASMED common stock and (y) the Series A Convertible Preferred Stock and the Series A Exchangeable Preferred Stock, voting together as a single class, (ii) the holders of a majority of the outstanding shares of Series A Convertible Preferred Stock, voting separately as a class, and (iii) the holders of a majority of the outstanding shares of Series A Exchangeable Preferred Stock, voting separately as a class, at the special meeting. Each of the proposal to adjourn the special meeting, if necessary, to solicit additional proxies and the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger requires the

affirmative vote (in person or by proxy) of the holders of a majority of the aggregate voting power of  (x) the outstanding shares of CASMED common stock and (y) the Series A Convertible Preferred Stock and the Series A Exchangeable Preferred Stock, voting together as a single class, present and entitled to vote at the special meeting.

Whether or not you plan to attend the special meeting, we urge you to vote your shares by completing, signing, dating and returning the accompanying proxy card as promptly as possible in the postage-paid envelope or to submit your proxy by telephone or the Internet prior to the special meeting to ensure that your shares will be represented at the special meeting. If you sign and return your proxy card without indicating how you wish to vote, your proxy will be voted “FOR” the adoption of the merger agreement and “FOR” the proposal to adjourn the special meeting, if necessary, to solicit additional proxies if there are insufficient votes to adopt the merger agreement at the time of the special meeting and “FOR” the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger. If you fail to return your proxy card or fail to submit your proxy by telephone or the Internet and do not vote in person at the special meeting, or if you hold your shares in “street name” and fail to instruct your bank, broker or other nominee on how to vote your shares of CASMED common stock, it will have the same effect as a vote “AGAINST” the adoption of the merger agreement, but will not affect the outcome of the vote regarding the proposal to adjourn the special meeting, if necessary, to solicit additional proxies or the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger. Any stockholder attending the special meeting may vote in person even if he or she has already voted by proxy card, telephone or Internet; such vote by ballot will revoke any proxy previously submitted. If you hold your shares through a bank, broker or other custodian, you must provide a legal proxy issued from such bank, broker or other custodian in order to vote your shares in person at the special meeting.

The presence at the special meeting in person or by proxy of the holders of a majority of the issued and outstanding shares of our capital stock entitled to vote at the special meeting as of the close of business on the record date will constitute a quorum for purposes of considering the proposals at the special meeting. Proxies received but marked as abstentions and broker non-votes will be included in the calculation of the number of votes considered to be present at the special meeting for purposes of determining whether a quorum is present.

The Company’s stockholders who do not vote in favor of the adoption of the merger agreement will have the right to seek appraisal of the fair value of their shares of CASMED stock if the merger contemplated by the merger agreement is completed, but only if they submit a written demand for appraisal of their shares before the taking of the vote on the merger agreement at the special meeting and they comply with all requirements of Delaware law, which are summarized in greater detail in the accompanying proxy statement.

You may revoke your proxy at any time before the vote at the special meeting by following the procedures outlined in the accompanying proxy statement. If you are a stockholder of record, you may revoke your proxy by attending the meeting and voting in person.

The accompanying proxy statement is dated [•], 2019 and is first being mailed to stockholders of the Company on or about [•], 2019.

By Order of the Board of Directors,

Jeffery A. Baird
Secretary

[•], 2019
Branford, Connecticut

   

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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER

The following questions and answers are intended to briefly address some commonly asked questions you may have regarding the special meeting, the merger agreement and the proposed merger. These questions and answers may not address all questions that may be important to you as a stockholder of CASMED. Please refer to the more detailed information contained elsewhere in this proxy statement, the annexes to this proxy statement and the documents referred to or incorporated by reference in this proxy statement, which you should read carefully. See the section of this proxy statement entitled “Where You Can Find More Information.”

Q: What is the proposed transaction?

A: The proposed transaction is the acquisition of CASMED by Edwards pursuant to the merger agreement. If the merger agreement is adopted by CASMED’s stockholders and the other closing conditions under the merger agreement have been satisfied or waived, Merger Sub, a wholly owned subsidiary of Edwards, will merge with and into CASMED. Upon consummation of the merger, CASMED will be the surviving corporation in the merger and will be a wholly owned subsidiary of Edwards. After the merger, shares of CASMED common stock will not be publicly traded.

Q: What will I receive for my shares of CASMED common stock in the merger?

A: Upon consummation of the merger, you will receive $2.45 in cash, without interest or dividends thereon and less any applicable withholding taxes, for each share of CASMED common stock that you own at the effective time of the merger (unless you have properly perfected your appraisal rights under Delaware law, in which case any consideration that you receive will be determined by the Delaware Court of Chancery). Upon consummation of the merger, you will no longer own shares in CASMED, nor will you be entitled to receive any shares in Edwards or the surviving corporation.

See the section of this proxy statement entitled “Proposal 1: Adoption of the Merger Agreement — Material U.S. Federal Income Tax Consequences” for a discussion of the tax consequences of the merger. You should consult your own tax advisor for a full understanding of how the merger will affect your federal, state, local and foreign taxes.

Q: How does the merger consideration compare to the market price of the CASMED common stock prior to announcement of the merger?

A: The per share merger consideration of  $2.45 in cash, without interest or dividends thereon and less applicable withholding taxes, contemplated to be received by the holders of CASMED common stock pursuant to the merger agreement represents a premium to historic trading prices, including a premium of approximately 56.1% over the closing sale price of  $1.57 on the NASDAQ Capital Market on February 11, 2019, the last trading day prior to announcement of the merger agreement.

Q: How will the Company’s stock options and restricted stock awards, be treated in the merger?

A: As of the effective time of the merger, all options to acquire shares of CASMED common stock that are outstanding and unexercised will become fully vested. We have agreed to take all actions necessary such that each option outstanding immediately prior to the effective time of the merger (whether vested or unvested) that represents the right to acquire CASMED common stock, at the effective time of the merger, will be cancelled and converted into a right to receive (i) as to those options with an exercise price that is equal to or less than $2.45 per share, the product of  (x) the excess of  $2.45 over the exercise price per share of the applicable option, and (y) the number of shares subject to the applicable option, less any applicable withholding taxes, and (ii) as to those options with an exercise price that exceeds $2.45 per share, the product of  $0.10 and the number of shares subject to the applicable option (except that any such options with an exercise price that exceeds $2.45 per share that are held by directors and executive officers of CASMED will be cancelled without payment of any consideration), less any applicable withholding taxes. In order to have all stock options available for cancellation, as is required under the merger agreement, we plan to commence a tender offer, as soon as practicable, to purchase all outstanding options (that do not expire by their terms at or prior to the completion of the merger) for the consideration set forth above.

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As of the effective time of the merger, each award of CASMED common stock that is subject to vesting conditions (each referred to in this proxy statement as a restricted stock award) will be vested, and each holder of a restricted stock award will have the right to receive an amount in cash equal to (x) the number of shares of CASMED common stock subject to such restricted stock award, multiplied by (y) $2.45, less any applicable withholding taxes.

Notwithstanding the foregoing, 150,000 shares of restricted stock subject to performance-based vesting conditions underlying an Inducement Restricted Stock Agreement made as of August 27, 2010 by and between CASMED and Thomas M. Patton, will be cancelled, with no further consideration due to Mr. Patton.

Q: How will the Company’s warrants and Employee Stock Purchase Plan be treated in the merger?

A: As soon as practicable following the date of the merger agreement, CASMED’s board of directors (or, if applicable, any committee thereof administering CASMED’s employee stock purchase plan) shall adopt such resolutions or take such other necessary actions such that: (i) the employee stock purchase plan shall be terminated, contingent upon the closing; (ii) no offering periods under the employee stock purchase plan shall commence after the effective time of the merger (and accordingly there shall be no payroll contributions to the employee stock purchase plan from participants after the effective time of the merger); and (iii) CASMED shall take all necessary actions so that no participants in the employee stock purchase plan have outstanding purchase rights under the employee stock purchase plan as of the effective time of the merger. Additionally, the CASMED board of directors (or, if applicable, any committee thereof administering the administering CASMED’s employee stock purchase plan), shall discontinue the current offering period under the employee stock purchase plan and provide that participants in such offering period shall have their accumulated payroll deductions for such offering period used to purchase CASMED common stock as of the last day of the month following the date of the merger agreement and such participants’ purchase rights under the employee stock purchase plan shall otherwise terminate following the date of such purchase.

Neither Edwards nor Merger Sub shall assume any warrants to purchase CASMED common stock or substitute for any such warrant any similar award for the common stock of Edwards or any of its affiliates in connection with the merger and the other transactions contemplated by the merger agreement. As of the effective time of the merger agreement, each unexercised warrant to purchase CASMED common stock that was outstanding immediately prior to the effective time of the merger shall, in accordance with the terms of the applicable warrant, no longer be exercisable and shall have either been exercised by the holder thereof in accordance with the terms of such warrant immediately prior to the effective time of the merger or if not so exercised, expired immediately prior to the effective time of the merger.

Q: Where and when is the special meeting?

A: The special meeting will be held at CASMED’s corporate offices located at 44 East Industrial Road, Branford, Connecticut 06405 at 10:00 a.m. Eastern Time on [•], 2019.

Q: Are all stockholders of the Company as of the record date entitled to vote at the special meeting?

A: Yes. All stockholders who own shares of CASMED common stock, CASMED Series A Convertible Preferred Stock and CASMED Series A Exchangeable Preferred Stock at the close of business on [•], 2019, the record date for the special meeting, will be entitled to receive notice of the special meeting and to vote (in person or by proxy) the shares of CASMED that they hold on that date at the special meeting, or any adjournments or postponements of the special meeting.

Q: What matters am I being asked to vote on at the special meeting?
A: You are being asked to vote:

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“FOR” or “AGAINST” the adoption of the merger agreement;

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“FOR” or “AGAINST” the proposal to adjourn the special meeting to a later date, if necessary, to solicit additional proxies if there are insufficient votes at the time of the special meeting to adopt the merger agreement; and

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“FOR” or “AGAINST” a non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger.

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Q: What vote of the Company’s stockholders is required to adopt the merger agreement?

A: For us to complete the merger, we will need the affirmative vote, in person or represented by proxy, of (i) the holders of a majority of the aggregate voting power of  (x) the outstanding shares of CASMED common stock and (y) the Series A Convertible Preferred Stock and the Series A Exchangeable Preferred Stock, voting together as a single class, (ii) the holders of a majority of the outstanding shares of Series A Convertible Preferred Stock, voting separately as a class, and (iii) the holders of a majority of the outstanding shares of Series A Exchangeable Preferred Stock, voting separately as a class. A failure to vote, an abstention or a broker non-vote will have the same effect as a vote “AGAINST” adoption of the merger agreement.

Q: What vote of the Company’s stockholders is required to adjourn the special meeting?

A: Approval of the proposal to adjourn the special meeting, if necessary, to solicit additional proxies requires the affirmative vote of the holders of a majority of the aggregate voting power of  (x) the outstanding shares of CASMED common stock and (y) the Series A Convertible Preferred Stock and the Series A Exchangeable Preferred Stock, voting together as a single class, present in person or represented by proxy at the special meeting and entitled to vote on the matter. A failure to attend the special meeting and vote your shares or failure to submit a proxy or a broker non-vote, will have no effect on the outcome of any vote to adjourn the special meeting. However, an abstention will have the same effect as voting “AGAINST” any proposal to adjourn the special meeting.

Q: What vote of the Company’s stockholders is required to approve the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger?

A: Approval of the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger requires the affirmative vote of a majority of the aggregate voting power of  (x) the outstanding shares of Company common stock and (y) the Series A Convertible Preferred Stock and the Series A Exchangeable Preferred Stock, voting together as a single class, present in person or represented by proxy at the special meeting and entitled to vote on the matter. A failure to attend the special meeting and vote your shares or failure to submit a proxy or a broker non-vote, will have no effect on the outcome of any vote to approve the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger. However, an abstention will have the same effect as voting “AGAINST” the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger.

Q: Why am I being asked to cast a vote on a non-binding advisory proposal to approve the golden parachute compensation payable to our named executive officers in connection with the merger?

A: In accordance with the rules promulgated by the SEC, under Section 14A of the Exchange Act, we are providing our stockholders with the opportunity to cast a vote on a non-binding advisory proposal to approve the golden parachute compensation payable to our named executive officers in connection with the merger.

Q: What is the “golden parachute compensation”?

A: The “golden parachute compensation” is certain compensation that is tied to or based on the completion of the merger and that is payable to our named executive officers. See “Proposal 3: Advisory Vote Regarding Golden Parachute Compensation.”

Q: What will happen if stockholders do not approve the “golden parachute compensation” at the special meeting?

A: Approval of the “golden parachute compensation” proposal is not a condition to the completion of the merger. The vote with respect to the “golden parachute compensation” proposal is an advisory vote and will

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not be binding on us or Edwards. Further, the underlying plans and arrangements are contractual in nature and not, by their terms, subject to stockholder approval. Accordingly, regardless of the outcome of the non-binding advisory vote, if the merger agreement is adopted by the stockholders and the merger is completed, our named executive officers will receive the “golden parachute compensation” to which they may be entitled.

Q: Does the board of directors recommend that the Company’s stockholders vote “FOR” the adoption of the merger agreement?

A: Yes. After careful consideration, the board of directors of the Company, by a unanimous vote, recommends that you vote:

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“FOR” the adoption of the merger agreement. You should read the section entitled “Proposal 1: Adoption of the Merger Agreement — Reasons for the Merger; Recommendation of Our Board of Directors” of this proxy statement for a discussion of certain factors that our board of directors considered in deciding to recommend the adoption of the merger agreement;

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“FOR” the adjournment of the special meeting, if necessary, to solicit additional proxies if there are insufficient votes at the time of the special meeting to adopt the merger agreement; and

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“FOR” a non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger.

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Q: Do any of the Company’s directors or executive officers have interests in the merger that may differ from or be in addition to my interests as a stockholder?

A: In considering the recommendation of our board of directors with respect to the merger, you should be aware that our directors, executive officers and their associates may have interests in the merger that may be different from, or in addition to, the interests of our stockholders generally. These interests include the accelerated vesting and payment of stock options and restricted stock awards. In addition, severance benefits may become payable to our executive officers in the event their employment is terminated and a cash transaction bonus will also become payable to each executive officer. Furthermore, one of our directors is a principal of the entities that hold all of the outstanding CASMED preferred stock. See the section of this proxy statement entitled “Proposal 1: Adoption of the Merger Agreement — Interests of Certain Persons in the Merger.” Our board of directors was aware of these differing interests and considered them, among other matters, in reaching its decision to adopt the merger agreement and the merger and to recommend that you vote in favor of adopting the merger agreement.

Q: What effects will the proposed merger have on the Company?

A: Upon consummation of the proposed merger, CASMED will cease to be a publicly traded company and will become wholly owned by Edwards. You will no longer have any interest in the future earnings or growth, if any, of CASMED. Following consummation of the merger, the registration of CASMED common stock and our reporting obligations with respect to CASMED common stock under the Securities Exchange Act of 1934, as amended (referred to in this proxy statement as the Exchange Act) will be terminated upon application to the SEC. In addition, upon completion of the proposed merger, shares of CASMED common stock will no longer be listed on the NASDAQ Capital Market, or any other stock exchange or quotation system.

Q: What happens if the merger is not consummated?

A: If the merger agreement is not adopted by stockholders or if the merger is not completed for any other reason, stockholders will not receive any payment for their shares in connection with the merger. Instead, CASMED will remain an independent public company and CASMED common stock will continue to be listed and traded on the NASDAQ Capital Market. If the merger agreement is terminated, under specified circumstances, CASMED may be required to pay Edwards a $3.5 million termination fee. The merger agreement also provides that in case it is terminated by either Edwards or CASMED following a failure to obtain the required vote of CASMED’s stockholders to adopt the merger agreement, CASMED will

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reimburse Edwards up to $1.0 million of transaction expenses, which payment, if any, will reduce on a dollar-for-dollar basis any termination fee otherwise owed to Edwards. See the section of this proxy statement entitled “The Merger Agreement — Termination Fees and Reimbursement of Expenses” for additional information.

Q: How do I vote my shares without attending the special meeting?
A: You may vote without attending the special meeting by:

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completing, signing and dating each proxy card you receive and returning it in the enclosed prepaid envelope by mail;

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using the telephone number printed on your proxy card;

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using the Internet voting instructions printed on your proxy card; or

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if your shares are held by a broker, bank or other stockholder of record exercising fiduciary powers which holds securities of record in nominee name or otherwise (typically referred to as being held in “street name”), following the procedures provided by your broker, bank or other nominee.

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Q: How do I vote my shares in person at the special meeting?

A: If you hold shares in your name as a stockholder of record, you may attend the special meeting and vote those shares in person at the meeting by giving us a signed proxy card or ballot before voting is closed. If you decide to vote in person, please bring proof of identification with you to the special meeting. Even if you plan to attend the meeting, we recommend that you vote your shares in advance as described above, so your vote will be counted if you later decide not to attend.

If you hold shares in “street name” through a broker, bank or other stockholder of record exercising fiduciary powers which holds securities of record in nominee name or otherwise, you may vote those shares in person at the meeting only if you obtain and bring with you a signed proxy from the necessary nominees giving you the right to vote the shares. To do this, you should contact your broker, bank or other nominee.

Q: If my shares are held in “street name” by my broker, bank or other nominee, will my broker, bank or other nominee vote my shares for me?

A: Your broker, bank or other nominee will not be able to vote your shares without instructions from you. You should instruct your broker, bank or other nominee to vote your shares following the procedure provided by your broker, bank or other nominee. Without instructions, your shares will not be voted, which will have the same effect as if you voted “AGAINST” adoption of the merger agreement, but will have no effect on the proposal to adjourn the special meeting if necessary, to solicit additional proxies or the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger.

Q: Can I revoke or change my vote?

A: Yes. If you hold your shares in your name as a stockholder of record, you have the right to change or revoke your proxy at any time before the vote taken at the special meeting by: (i) filing with the Corporate Secretary of the Company at the Company’s principal executive offices, 44 East Industrial Road, Branford, CT 06405, a written notice of revocation or a duly executed proxy bearing a later date than the date of the proxy; or (ii) attending the special meeting and voting in person. Attendance at the special meeting will not, by itself, change or revoke a proxy — you must vote in person at the meeting to revoke a prior proxy. If you hold your shares through a broker, bank, or other nominee, follow the directions received from your broker, bank or other nominee to change or revoke your instructions.

Q: What does it mean if I get more than one proxy card or vote instruction form?

A: If your shares are registered differently and are in more than one account, you may receive more than one proxy card or vote instruction form. Please complete, sign, date and return all of the proxy cards and vote instruction forms you receive regarding the special meeting (or submit your proxy for all shares by telephone or the Internet) to ensure that all of your shares are voted.

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Q: When should I send my proxy card?

A: You should send your proxy card as soon as possible so that your shares will be voted at the special meeting.

Q: What do I need to do now?

A: Even if you plan to attend the special meeting, after carefully reading and considering the information contained in this proxy statement, if you hold your shares in your own name as the stockholder of record, please vote your shares by: completing, signing, dating and returning the enclosed proxy card; using the telephone number printed on your proxy card; or using the Internet voting instructions printed on your proxy card. You can also attend the special meeting and vote. DO NOT return your stock certificate(s) with your proxy card.

If your shares of CASMED common stock are held in “street name” by your broker, bank or other nominee, you should instruct your broker, bank or other nominee on how to vote your shares of CASMED common stock using the instructions provided by your broker, bank or other nominee. If your shares of CASMED common stock are held in “street name” and you do not provide your broker, bank or other nominee with instructions, your shares of CASMED common stock will not be voted and that will have the same effect as voting “AGAINST” the adoption of the merger agreement but will have no effect on the outcome of any vote to adjourn the special meeting or to approve a non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger.

Q: Are appraisal rights available?

A: Yes. As a stockholder of CASMED, you are entitled to appraisal rights under Delaware law if you do not vote in favor of adoption of the merger agreement, and you properly demand and perfect your appraisal rights under Delaware law. See the section of this proxy statement entitled “Appraisal Rights.”

Q: When do you expect the merger to be completed?

A: We anticipate that the merger will be completed during the second quarter of 2019, assuming satisfaction or waiver of all of the conditions to the merger. However, the merger is subject to various regulatory approvals and other conditions, and it is possible that factors outside the control of CASMED and Edwards could result in the merger being completed at a later time or not at all.

Q: If the merger is completed, when can I expect to receive the merger consideration for my shares of CASMED common stock?

A: Promptly after the completion of the merger, you will be sent a letter of transmittal describing how you may exchange your shares of CASMED common stock for the merger consideration. You should not send your CASMED common stock certificates to us or anyone else until you receive these instructions.

Q: Who will bear the cost of this solicitation?

A: The expenses of preparing, printing and mailing this proxy statement and the proxies solicited hereby will be borne by the Company. The Company will, upon request, reimburse brokerage houses and other custodians, nominees and fiduciaries for their reasonable expenses for forwarding material to the beneficial owners of shares held of record by others. Additional solicitations may be made by telephone, facsimile or other contact by certain directors, officers or employees of the Company, none of whom will receive additional compensation therefor, and by our proxy solicitor, as described below.

Q: Will a proxy solicitor be used?

A: Yes. The Company has engaged Morrow Sodali LLC to assist in the solicitation of proxies for the special meeting, and the Company estimates that it will pay Morrow Sodali LLC a fee of approximately $7,500. The Company has also agreed to reimburse Morrow Sodali LLC for out-of-pocket expenses and to indemnify them against certain losses arising out of their proxy solicitation services.

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Q: Should I send in my stock certificates now?

A: No. PLEASE DO NOT SEND IN YOUR STOCK CERTIFICATES WITH YOUR PROXY.

Shortly after the merger is completed, you will receive a letter of transmittal with instructions informing you how to send in your stock certificates to the paying agent in order to receive the merger consideration in respect of your shares of CASMED common stock. You should use the letter of transmittal to exchange your stock certificates for the merger consideration which you are entitled to receive as a result of the merger.

Q: Is the merger expected to be taxable to me?

A: The exchange of shares of CASMED common stock for cash pursuant to the merger agreement generally will be a taxable transaction to U.S. holders (as described in “Proposal 1: Adoption of the Merger Agreement — Material U.S. Federal Income Tax Consequences”) for U.S. federal income tax purposes. If you are a U.S. holder and you exchange your shares of CASMED common stock in the merger, you will generally recognize gain or loss in an amount equal to the difference, if any, between the cash received in the merger and your adjusted tax basis in such shares. The merger generally will not be a taxable transaction to non-U.S. holders for U.S. federal income tax purposes unless the non-U.S. holder has certain connections to the United States, but may be a taxable transaction under foreign tax laws.

See the section of this proxy statement entitled “Proposal 1: Adoption of the Merger Agreement — Material U.S. Federal Income Tax Consequences” for a more detailed discussion of the U.S. federal income tax consequences of the merger. You should also consult your independent tax advisor as to the particular tax consequences of the merger to you.

Q: What happens if I sell my shares before the special meeting?

A: The record date of the special meeting is earlier than the special meeting and the date that the merger is expected to be completed. If you transfer your shares of CASMED common stock after the record date but before the special meeting, you will retain your right to vote at the special meeting, but will have transferred the right to receive $2.45 per common share in cash, without interest or dividends thereon and less applicable withholding taxes, to be received by our stockholders in the merger. In order to receive the $2.45 per common share, without interest or dividends thereon and less applicable withholding taxes, you must hold your shares through completion of the merger.

Q: Who can help answer my other questions?

A: If you have more questions about the merger, need assistance in submitting your proxy or voting your shares, or need additional copies of the proxy statement or the enclosed proxy card, you should contact Morrow Sodali LLC, our proxy solicitor:

Toll Free: (800) 662-5200
Email to: [email protected]
Address: 470 West Avenue, Stamford, CT 06902

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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING INFORMATION

This proxy statement, and the documents to which we refer you in this proxy statement, contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act. Forward-looking statements include, among others, information concerning the possible or assumed future results of operations of the Company, the expected completion and timing of the merger and other information relating to the merger. There are forward-looking statements throughout this proxy statement, including, without limitation, under the headings “Proxy Statement Summary,” “Questions and Answers about the Special Meeting and the Merger,” “Proposal 1: Adoption of the Merger Agreement,” “Proposal 1: Adoption of the Merger Agreement — Certain Financial Forecasts,” “Proposal 1: Adoption of the Merger Agreement — Governmental and Regulatory Approvals” and “Proposal 1: Adoption of the Merger Agreement — Opinion of CASMED’s Financial Advisor.” Forward-looking statements can be identified by words such as “believes,” “expects,” “predicts,” “estimates,” “anticipates,” “continues,” “contemplates,” “projects,” “intends,” “may,” “will,” “could,” “should” or “would” or similar expressions, or by discussion of competitive strengths or strategy that involve risks and uncertainties. These statements, which are based on information currently available to us, are not guarantees of future performance, actual outcomes or developments and may involve risks and uncertainties that could cause our actual outcomes, developments, growth, results of operations, performance and business prospects and opportunities to materially differ from those expressed in, or implied by, these statements. In addition to other factors and matters contained or incorporated in this document, these statements are subject to risks, uncertainties, and other factors, including, among others:

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the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement;

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the outcome of any legal proceeding that has been or may be instituted against CASMED and others relating to the merger agreement;

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the inability to complete the merger due to the failure to obtain stockholder approval, the failure to obtain regulatory approvals or the failure to satisfy other conditions to consummation of the merger;

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the failure of the merger to close for any other reason;

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the risk that the merger agreement may be terminated in circumstances requiring us to pay Edwards a termination fee of  $3.5 million or reimburse Edwards for up to $1.0 million in transaction expenses;

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risks that the proposed transactions disrupt current business plans and operations and the potential difficulties in attracting and retaining senior management or employees as a result of the merger;

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business uncertainty and contractual restrictions during the pendency of the merger;

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the fact that under the terms of the merger agreement, we are unable to solicit other Company Acquisition Proposals during the pendency of the merger;

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the diversion of management’s attention from ongoing business concerns;

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the effect of the announcement of the merger on our customer and supplier relationships, operating results and business generally;

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the amount of the costs, fees, expenses and charges related to the merger;

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the timing of the completion of the merger and the impact of the merger on our indebtedness, capital resources, cash requirements, profitability, management resources and liquidity;

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the risk that our stock price may decline significantly if the merger is not consummated;

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the nature, cost and outcome of any litigation and other legal proceedings, including any such proceedings related to the merger and instituted against us and others;

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•

risks and uncertainties relating to our business (including our ability to achieve strategic goals, objectives and targets over applicable periods), industry performance and the regulatory environment;

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the fact that our stockholders would forego the opportunity to realize the potential long-term value of the successful execution of our current strategy as an independent public company;

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the effects of a recession in the United States or other parts of the world and general downturn in the economy, including the illiquidity in the debt/capital markets; and

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other risks detailed in our current filings with the SEC, including our most recent filings on Forms 10-K, 10-Q and 8-K. See the section of this proxy statement entitled “Where You Can Find More Information.”

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The forward-looking statements contained in this proxy statement speak only as of the date on which such statements were made and we undertake no obligation, other than as may be required under the federal securities laws, to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Our stockholders are advised, however, to consult any future disclosures we make on related subjects as may be detailed in our other filings made from time to time with the SEC.

We do not assume responsibility for the accuracy and completeness of forward-looking statements. Any or all of the forward-looking statements contained in this proxy statement and in any other public statements that are made may prove to be incorrect. This may occur as a result of inaccurate assumptions or as a consequence of known or unknown risks and uncertainties. All of the forward-looking statements are qualified in their entirety by reference to the risk factors discussed above and under the caption “Risk Factors” of our most recent filings on Forms 10-K, 10-Q and 8-K.

We operate in a continually changing business environment, and new risk factors emerge from time to time. We cannot predict these new risk factors, nor can we assess the impact, if any, of the new risk factors on our business or the extent to which any factor or combination of factors may cause actual results or outcomes to differ materially from those expressed or implied by any forward-looking statement. In light of these risks, uncertainties and assumptions, the forward-looking events discussed in this proxy statement might not occur.

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THE PARTIES TO THE MERGER

CAS Medical Systems, Inc.

44 East Industrial Road
Branford, CT 06405
(203) 488-6056

CAS Medical Systems, Inc. is a medical technology company that develops, manufactures, and markets non-invasive patient monitoring products that are consistent with our vision: That no patient is harmed by undetected tissue hypoxia. Our principal products are the FORE-SIGHT ELITE® and FORE-SIGHT® brand tissue oximeters and sensors which account for nearly all of our sales from continuing operations. With a simple non-invasive sensor applied to the skin, these products alert clinicians to the oxygenation levels of a patient’s brain or other body tissue during medical procedures to avoid harm caused by insufficient oxygen, or hypoxia. We also perform service repairs that are categorized as Service and Other.

Consistent with its strategy to focus exclusively on the tissue oximetry market opportunity, the Company divested its non-strategic product lines. In July 2017, with the sale of its final legacy product line, related to non-invasive blood pressure monitoring, the Company completed its multi-year transition from a lower-margin capital equipment business to a high-margin medical disposables business. FORE-SIGHT disposable sensors now account for 88% of net sales from continuing operations for the nine months ended September 30, 2018.

Edwards Lifesciences Holding, Inc.

One Edwards Way
Irvine, CA 92614
(949) 250-2500

Edwards is a wholly-owned subsidiary of Edwards Lifesciences. Edwards Lifesciences, based in Irvine, California, is the global leader in patient-focused medical innovations for structural heart disease, as well as critical care and surgical monitoring. Driven by a passion to help patients, the company collaborates with the world’s leading clinicians and researchers to address unmet healthcare needs, working to improve patient outcomes and enhance lives. Headquartered in Irvine, Calif., Edwards Lifesciences treats advanced cardiovascular disease with its life saving innovations, which are sold in approximately 100 countries. Many of the company’s products are considered industry “gold standards” and over 95% percent of its sales are from products in leading market positions. Edwards Lifesciences has extensive manufacturing operations in North America, Europe, Singapore, Central America and the Caribbean.

Crown Merger Sub, Inc.

c/o Edwards Lifesciences Corporation
One Edwards Way
Irvine, CA 92614
(949) 250-2500

Crown Merger Sub, Inc. is a Delaware corporation and a wholly owned subsidiary of Edwards. It was formed solely for the purpose of effecting the merger and the transactions contemplated by the merger agreement, and it has not engaged in any other business.

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THE SPECIAL MEETING

We are furnishing this proxy statement to the CASMED stockholders as part of the solicitation of proxies by the board of directors for use at the special meeting or any adjournment or postponement thereof. This proxy statement provides the CASMED stockholders with the information they need to know to be able to vote or instruct their vote to be cast at the special meeting or any adjournment or postponement thereof.

Date, Time and Place of the Special Meeting

This proxy statement is being furnished to our stockholders as part of the solicitation of proxies by our board of directors for use at the special meeting to be held at CASMED’s corporate offices located at 44 East Industrial Road, Branford, Connecticut 06405 at 10:00 a.m. Eastern Time on [•], 2019, or at any postponement or adjournment thereof.

Purpose of the Special Meeting

The purpose of the special meeting is for our stockholders to consider and vote upon a proposal to adopt the merger agreement (and to approve (i) the adjournment of the special meeting, if necessary, to solicit additional proxies if there are insufficient votes at the time of the special meeting to adopt the merger agreement; and (ii) a non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger). The adoption of the merger agreement requires the affirmative vote (in person or by proxy) of  (i) the holders of a majority of the aggregate voting power of  (x) the outstanding shares of CASMED common stock and (y) the Series A Convertible Preferred Stock and the Series A Exchangeable Preferred Stock, voting together as a single class, (ii) the holders of a majority of the outstanding shares of Series A Convertible Preferred Stock, voting separately as a class, and (iii) the holders of a majority of the outstanding shares of Series A Exchangeable Preferred Stock, voting separately as a class, at the special meeting. A copy of the merger agreement is attached as Annex A to this proxy statement.

Board of Directors Recommendation

After careful consideration, our board of directors, by unanimous vote, approved and declared advisable the execution, delivery and performance of the merger agreement and the transactions contemplated by the merger agreement, including the merger, and determined that entering into the merger agreement and consummating the merger, are in the best interests of CASMED’s stockholders. Our board of directors recommends that you vote “FOR” the proposal to adopt the merger agreement, “FOR” the proposal to adjourn the special meeting, if necessary, to solicit additional proxies and “FOR” the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger. For a discussion of the material factors considered by our board of directors in reaching its conclusions, see the section of this proxy statement entitled “Proposal 1: Adoption of the Merger Agreement — Reasons for the Merger; Recommendation of Our Board of Directors.”

Record Date and Quorum

We have fixed the close of business on [•], 2019 as the record date for the special meeting, and only holders of record of shares of CASMED common stock, Series A Convertible Preferred Stock and Series A Exchangeable Preferred Stock on the record date are entitled to notice of, and to vote at, the special meeting or at any adjournments or postponements thereof.

As of the record date, there were issued and outstanding:

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[•] shares of CASMED common stock; and

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95,500 shares of CASMED Series A Convertible Preferred Stock and 54,500 shares of CASMED Series A Exchangeable Preferred Stock (which is substantially identical to the Series A Convertible Preferred Stock) containing voting rights equivalent to a total of 5,319,149 shares of common stock.

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Each common stockholder has one vote for each share of common stock owned as of the record date. Each holder of a share of Series A Convertible Preferred Stock and Series A Exchangeable Preferred Stock has 35.46 votes per share owned as of the record date. Therefore, a total of  [•] votes are eligible to be cast at the special meeting.

With respect to the vote on the adoption of the merger agreement, each holder of a share of Series A Convertible Preferred Stock and Series A Exchangeable Preferred Stock has one vote per share with respect to the separate class vote by each such class of preferred stock.

The presence at the special meeting in person or by proxy of the holders of a majority of the issued and outstanding shares of our capital stock entitled to vote at the special meeting as of the close of business on the record date will constitute a quorum for purposes of considering the proposals at the special meeting. Proxies received but marked as abstentions and broker non-votes will be included in the calculation of the number of votes considered to be present at the special meeting for purposes of determining whether a quorum is present. A broker non-vote occurs on an item when a broker is not permitted to vote on that item without instructions from the beneficial owner of the shares, and no instructions are given. In the event that a quorum is not present at the special meeting, it is expected that the meeting would be adjourned to a later date to solicit additional proxies, and a quorum will have to be established at such adjourned date.

Vote Required for Approval

The adoption of the merger agreement requires the affirmative vote (in person or by proxy) of  (i) the holders of a majority of the aggregate voting power of  (x) the outstanding shares of CASMED common stock and (y) the Series A Convertible Preferred Stock and the Series A Exchangeable Preferred Stock, voting together as a single class, (ii) the holders of a majority of the outstanding shares of Series A Convertible Preferred Stock, voting separately as a class, and (iii) the holders of a majority of the outstanding shares of Series A Exchangeable Preferred Stock, voting separately as a class, at the special meeting. For the proposal to adopt the merger agreement, you may vote “FOR,” “AGAINST” or “ABSTAIN.” Abstentions will not be counted as votes cast or shares voting on the proposal to adopt the merger agreement, but will count for the purpose of determining whether a quorum is present. If you abstain, it will have the same effect as a vote “AGAINST” the adoption of the merger agreement.

Brokers, banks or other nominees who hold shares of CASMED common stock in “street name” for customers who are the beneficial owners of such shares may not give a proxy to vote those customers’ shares in the absence of specific instructions from those customers. These non-voted shares of CASMED common stock will not be counted as votes cast or shares voting and will have the same effect as votes “AGAINST” approval and adoption of the merger agreement.

Approval of each of  (i) any proposal to adjourn the special meeting, if necessary, for the purpose of soliciting additional proxies and (ii) the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger requires the affirmative vote of the holders of a majority of the aggregate voting power of  (x) the outstanding shares of CASMED common stock and (y) the Series A Convertible Preferred Stock and the Series A Exchangeable Preferred Stock, voting together as a single class, present in person or represented by proxy at the special meeting and entitled to vote on the matter. A failure to vote your shares of CASMED or a broker non-vote will have no effect on the outcome of any vote to adjourn the special meeting or to approve the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger. An abstention will have the same effect as voting “AGAINST” any proposal to adjourn the special meeting or to approve the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger.

Shares Held by Directors and Executive Officers

As of  [•], 2019, the record date for the special meeting, our directors and executive officers beneficially owned, and had the right to vote, in the aggregate, [•] shares of CASMED common stock, and shares of CASMED preferred stock holding voting rights equivalent to 5,319,149 shares of CASMED common

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stock, representing an aggregate of  [•] votes, which represented approximately [•]% of the votes which may be cast at the special meeting and 100% of the outstanding CASMED preferred stock (which has separate class voting rights with respect to the adoption of the merger agreement). Our current directors and executive officers have agreed to vote all their shares of CASMED common stock and CASMED preferred stock “FOR” the adoption of the merger agreement and “FOR” the adjournment of the special meeting, if necessary, to solicit additional proxies, and intend to vote “FOR” the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger.

Voting Agreements

In connection with the execution of the merger agreement, Edwards entered into separate Voting Agreements (which we refer to collectively, as the voting agreements), with each of the holders of our Series A Convertible Preferred Stock and Series A Exchangeable Preferred Stock, and each of our executive officers and non-employee directors, pursuant to which, among other matters, they each agreed (1) to vote the shares of CASMED stock held by each of them in favor of the adoption of the merger agreement and the approval of the merger, and to vote against any alternate proposal, (2) not to undertake certain activities related to solicitation of a Company Acquisition Proposal (as defined in the merger agreement), (3) not to transfer their shares of CASMED stock prior to the consummation of the merger, subject to limited exceptions, (4) to waive their appraisal rights under Delaware law, (5) to cancel all of their out of the money stock options, and in the case of Mr. Patton, a performance restricted stock grant, immediately prior to the closing of the merger, and (6) with respect to the holders of the Series A Convertible Preferred Stock and Series A Exchangeable Preferred Stock, to convert their preferred shares into CASMED common stock prior to the merger.

Proxies and Revocation

In order for your shares of CASMED stock to be included in the vote, if you are a stockholder of record, you must either have your shares voted by returning the enclosed proxy card or by authorizing your proxy or voting instructions by telephone or Internet or voting in person at the special meeting.

Record holders may vote or cause their shares of CASMED common stock to be voted by proxy using one of the following methods:

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completing, signing and dating each proxy card you receive and returning it in the enclosed prepaid envelope by mail;

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using the telephone number printed on your proxy card;

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using the Internet voting instructions printed on your proxy card; or

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appearing at the special meeting and voting in person.

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If no instructions are indicated on your signed proxy card, your shares will be voted “FOR” the adoption of the merger agreement, “FOR” adjournment of the special meeting, if necessary, to solicit additional proxies and “FOR” approval of the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger.

If your shares of CASMED common stock are held in “street name” by your broker, bank or other nominee, you should instruct your broker, bank or other nominee on how to vote your shares of CASMED common stock using the instructions provided by your broker, bank or other nominee.

WHETHER OR NOT YOU PLAN TO ATTEND THE SPECIAL MEETING, PLEASE COMPLETE, DATE, SIGN AND RETURN, AS PROMPTLY AS POSSIBLE, THE ENCLOSED PROXY CARD IN THE ACCOMPANYING REPLY ENVELOPE, OR SUBMIT YOUR PROXY BY TELEPHONE OR THE INTERNET. STOCKHOLDERS WHO ATTEND THE MEETING MAY REVOKE THEIR PROXIES AND VOTE IN PERSON.

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If you submit a proxy by telephone or the Internet or by returning a signed proxy card by mail, your shares will be voted at the special meeting as you indicate on your proxy card or by such other method. If you sign your proxy card without indicating your vote, your shares will be voted “FOR” the adoption of the merger agreement, “FOR” the adjournment of the special meeting, if necessary, to solicit additional proxies and “FOR” the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger.

If you abstain, your shares of CASMED stock will be treated as present at the special meeting for purposes of determining the presence or absence of a quorum for the transaction of business; however, your shares will not be counted as votes cast or shares voting on the proposals.

If your shares of CASMED common stock are held in “street name,” you will receive instructions from your broker, bank or other nominee that you must follow in order to have your shares voted. If you do not instruct your broker, bank or other nominee to vote your shares, it has the same effect as a vote “AGAINST” the proposal to adopt the merger agreement but will have no effect on the proposal to adjourn the special meeting, if necessary, to solicit additional proxies or the non-binding advisory proposal to approve the golden parachute compensation payable to CASMED’s named executive officers in connection with the merger.

Proxies received at any time before the special meeting, and not revoked or superseded before being voted, will be voted at the special meeting. If you hold your shares in your name as a stockholder of record, you have the right to change or revoke your proxy at any time before the vote taken at the special meeting by:

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filing with the Corporate Secretary of the Company at the Company’s principal executive offices, 44 East Industrial Road, Branford, CT 06405, a written notice of revocation or a duly executed proxy bearing a later date than the date of the proxy; or

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•

attending the special meeting and voting in person. Attendance at the special meeting will not, by itself, change or revoke a proxy — you must vote in person at the meeting to revoke a prior proxy.

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If you hold your shares through a broker, bank, or other nominee, you have the right to change or revoke your proxy at any time before the vote taken at the special meeting by following the directions received from your broker, bank or other nominee to change or revoke those instructions.

PLEASE DO NOT SEND IN YOUR STOCK CERTIFICATES WITH YOUR PROXY CARD. IF THE MERGER IS COMPLETED, A SEPARATE LETTER OF TRANSMITTAL WILL BE MAILED TO YOU THAT WILL ENABLE YOU TO RECEIVE THE MERGER CONSIDERATION IN EXCHANGE FOR YOUR CASMED STOCK CERTIFICATES.

Adjournments and Postponements

Although it is not currently expected, the special meeting may be adjourned or postponed for the purpose of soliciting additional proxies. Any adjournment may be made without notice, other than by an announcement made at the special meeting of the time, date and place of the adjourned meeting, provided that if the adjournment is for more than 30 days, or if after the adjournment a new record date is fixed for the adjourned meeting, notice of the adjourned meeting in accordance with the bylaws of the Company will be given to each stockholder of record entitled to notice of and to vote at the meeting. Holders of a majority of the voting power of CASMED stock present in person or represented by proxy at the special meeting and entitled to vote may adjourn or postpone the special meeting. Any signed proxies received by us in which no voting instructions are provided on the matter will be voted “FOR” an adjournment of the special meeting, if necessary, to solicit additional proxies. Any adjournment or postponement of the special meeting for the purpose of soliciting additional proxies will allow our stockholders who have already sent in their proxies to revoke them at any time prior to their use at the special meeting as adjourned or postponed.

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Rights of Stockholders Who Dissent From the Merger

Stockholders are entitled to statutory appraisal rights under Delaware law in connection with the merger. This means that you are entitled to have the value of your shares of CASMED stock determined by the Delaware Court of Chancery and to receive payment based on that valuation. The ultimate amount you receive as a dissenting stockholder in an appraisal proceeding may be more than, the same as or less than the amount you would have received under the merger agreement.

To perfect your appraisal rights, you must submit a written demand for appraisal to us before the vote is taken on the merger agreement and you must not vote in favor of the adoption of the merger agreement. Your failure to follow exactly the procedures specified under Delaware law will result in the loss of your appraisal rights. See the section of this proxy statement entitled “Appraisal Rights” and the text of the Delaware appraisal rights statute, Section 262 of the DGCL, reproduced in its entirety as Annex D to this proxy statement. This proxy statement constitutes our notice to our stockholders of the availability of appraisal rights in connection with the merger in compliance with the requirements of Section 262 of the DGCL.

Solicitation of Proxies

This proxy solicitation is being made and paid for by us on behalf of our board of directors. In addition, we have engaged Morrow Sodali LLC to assist in the solicitation of proxies for the special meeting, and we estimate that we will pay Morrow Sodali LLC a fee of approximately $7,500. We also have agreed to reimburse Morrow Sodali LLC for out-of-pocket expenses and to indemnify them against certain losses arising out of their proxy solicitation services. Our directors, officers and employees may also solicit proxies by personal interview, mail, e-mail, telephone, facsimile or other means of communication. These persons will not be paid additional compensation for their efforts. We will also request brokers, banks and other nominees to forward proxy solicitation material to the beneficial owners of shares of CASMED common stock that the brokers, banks and nominees hold of record. Upon request, we will reimburse them for their reasonable out-of-pocket expenses related to forwarding the material.

Questions and Additional Information

If you have more questions about the merger, need assistance in submitting your proxy or voting your shares, or need additional copies of the proxy statement or the enclosed proxy card, you should contact Morrow Sodali LLC, our proxy solicitor:

Toll Free: (800) 662-5200
Email to: [email protected]
Address: 470 West Avenue, Stamford, CT 06902

If your broker, bank or other nominee holds your shares, you should also call your broker, bank or other nominee for additional information.

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PROPOSAL 1
ADOPTION OF THE MERGER AGREEMENT

Background of the Merger

Over the past several years, CASMED’s board of directors and management routinely considered various strategic initiatives in light of then-current revenues, growth rates, technology development stages, market development opportunities, competition, personnel, cash availability, financing opportunities and informal outreach with various medical device industry companies. In addition, CASMED management routinely contacted various potential technology partners and acquirers to discuss CASMED’s technology and strategies.

In early 2016 the CASMED board of directors determined that it would be advantageous to obtain the professional advisory services of an investment bank to more formally explore market interest in an acquisition of, or a merger or other combination with, CASMED. On April 1, 2016 CASMED engaged William Blair as strategic advisors.

In the aggregate, William Blair and CASMED management approached 38 potential counterparties (consisting of 37 strategic counterparties and 1 financial counterparty), engaged in discussions and due diligence with 19 potential counterparties, entered into 14 non-disclosure agreements, and ultimately received two bids to purchase CASMED.

Specifically, after consultation with CASMED, in April 2016 William Blair initially contacted fifteen parties to introduce CASMED and explore whether the exchange of information would be useful. Initially, four of these parties executed non-disclosure agreements. On April 26, 2016, William Blair and management updated the CASMED board of directors regarding these ongoing strategic activities.

As a result of the outreach and exchange of certain information, CASMED held management meetings throughout the summer and early fall of 2016 with Company A, Company B, and Company C. Simultaneously, CASMED was also sharing information with Edwards Lifesciences regarding a potential strategic transaction, including either a potential commercial collaboration or a potential acquisition. On June 22, 2016, management and William Blair representatives provided an update on the strategic initiatives to the board of directors. On July 27, 2016, management provided another update to the CASMED board of directors including the current advice of William Blair regarding the status of the process.

In late summer and early fall 2016, William Blair and CASMED management continued their outreach resulting in additional CASMED management meetings or discussions with Company D, Company E, Company F, Company G and Company H.

On September 1, 2016, Company B communicated to William Blair that it would not be moving forward with the transaction at this time.

On October 22 and 23, 2016, CASMED met with business development executives from Edwards Lifesciences, Company J and Company D, respectively, to discuss issues related to a potential strategic transaction. On October 26, 2016, CASMED management updated the CASMED board of directors on the status of the strategic discussions.

On November 17 and 18, 2016, as part of the discussions between CASMED and Edwards Lifesciences related to a potential commercial collaboration or acquisition, CASMED held a meeting with various executives of Edwards Lifesciences, including an on-site tour of the facilities.

At a December 14, 2016, CASMED board of directors’ meeting, CASMED management led a discussion regarding continued strategic outreach and initiatives.

At various times in 2016, certain companies communicated to Blair or to CASMED management their lack of interest in pursuing a strategic transaction with CASMED.

On January 11, 2017, CASMED management met with business development executives from Edwards Lifesciences for a general discussion regarding the possibilities and processes related to a potential commercial collaboration or acquisition.

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On January 24, 2017, William Blair contacted Company M and provided a packet of non-confidential information on CASMED.

On January 24, 2017, Company I entered into a non-disclosure agreement and CASMED management met with certain business representatives of Company I to provide relevant information regarding CASMED, its products and the potential for synergies with Company I.

On February 22, 2017, Edwards Lifesciences communicated with CASMED indicating that additional time and resources would be committed to consider an acquisition of CASMED, including with respect to legal and intellectual property due diligence.

On March 1, 2017, CASMED management provided an update to the CASMED board of directors regarding strategic initiatives and discussions. On March 2, 2017, representatives of William Blair contacted Company J, previously contacted by CASMED management, to invite it to participate in reviewing information from CASMED. It declined.

On March 2, 2017, CASMED executed a non-disclosure agreement and began discussions with Company K, and its equity sponsor, to consider funding a combination with other potential businesses.

On March 7, 2017, executives and business development personnel from Edwards Lifesciences met with CASMED management in an all-day session to discuss due diligence items relating to potential strategic alternatives of a commercial collaboration or an acquisition. Information continued to be exchanged in furtherance of both alternatives after that meeting.

On March 30, 2017, CASMED management held a meeting with Company G regarding potential interest in a strategic combination.

On April 3, 2017, Company L entered into a non-disclosure agreement and CASMED management held a meeting with the chief executive of Company L to consider a combination of the two businesses.

On April 12, 2017, CASMED management met with representatives of a private equity group considering the sponsorship of Company I to fund a combination with CASMED.

On April 14, 2017, an executive of Edwards Lifesciences indicated to CASMED management that Edwards Lifesciences was not prepared to provide a bid for the acquisition of CASMED but that it remained interested in a commercial collaboration. A discussion ensued regarding opportunities for cooperation that included the commitment to and acceleration of the development of an OEM module of CASMED’s FORE-SIGHT product.

On May 23, 2017, CASMED management had initial contact with the CEO of Company M regarding the possibility of a strategic transaction and Company M entered into a non-disclosure agreement with CASMED.

On May 25, 2017, CASMED management held a meeting with representatives from Company K to consider a combination with all or part of that company.

On June 6, 2017, and June 21, 2017, CASMED management provided the CASMED board of directors with updates on efforts regarding its strategic initiatives.

On July 18, 2017, Mr. Patton, CASMED’s chief executive officer, met with the CEO of Company M to discuss various business matters including the possibility of some type of business combination. On July 19, 2017 various members of CASMED management held an all-day due diligence session with various executives of Company M in consideration of a strategic initiative.

At the CASMED board of directors meeting of August 2, 2017, management provided an update regarding the various ongoing strategic activities including the possibility of a combination with Company I in the event such company received financial support for its initiatives.

On August 10, 2017, Mr. Patton had a discussion with Edwards Lifesciences management regarding Edwards Lifesciences’ continued interest in the commercial collaboration between the parties, including possible timelines for related activities.

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On October 3, 2017, Company M communicated to William Blair that it would not be moving forward with a potential acquisition of CASMED at that time.

On October 25, 2017, the CASMED board of directors received a presentation from Company I regarding the current state of the effort to fund its strategic initiatives which might include a combination with CASMED. In addition, William Blair and CASMED management provided an overview of the overall M&A market, and updated the Board on various outreach efforts and points of contact regarding the potential sale of CASMED.

On December 13, 2017, the CASMED board of directors received an update regarding the various ongoing strategic initiatives.

In January 2018, CASMED management held meetings with Edwards Lifesciences regarding their ongoing commercial collaboration efforts. Also during January 2018, CASMED management held meetings with Company N, Company M, potential financial sponsors for a combination with Company K, and financial sponsor of Company O. On January 9, 2018, Company O entered into a non-disclosure agreement with CASMED. During the month of January 2018 financial and operational information was exchanged with Company O and their financial sponsor culminating in a meeting on January 24, 2018 with various members of management from both companies, and a follow up meeting on February 2, 2018 with a smaller number of executives from each business. On February 14, 2018, the financial sponsor of Company O communicated that it would not be providing a proposal to CASMED.

On March 7, 2018, CASMED management provided the CASMED board of directors with the status of the various strategic initiatives.

On March 16, 2018, Company N communicated to William Blair that it was not interested in moving forward with the transaction due to competing priorities.

On March 23, 2018, CASMED provided Company P with non-confidential information.

On May 3, 2018, Company P entered into a non-disclosure agreement with CASMED.

On July 2, 2018, certain executives of Company P visited the company’s facilities in Branford, CT and held a meeting with executives of CASMED. Thereafter CASMED provided certain financial and market information to Company P.

Throughout 2017 and 2018, Edwards Lifesciences and CASMED continued to work on a commercial collaboration to incorporate CASMED’s FORE-SIGHT technology into a module form that would be combined with Edwards Lifesciences’ HemoSphere hemodynamic monitoring platform. That project included regular calls between research and development personnel, quality audits by Edwards Lifesciences of CASMED’s quality system, preliminary discussions regarding joint marketing, clinical and sales efforts for the combined product, and the negotiation of financial terms of the sale of the modules to Edwards Lifesciences.

On July 19, 2018, CASMED management met with representatives of Edwards Lifesciences to discuss due diligence and strategic issues relating to the parties’ commercial collaboration efforts.

On July 24, 2018, Mr. Patton provided the CASMED board of directors with an update on strategic interest in CASMED and expectations regarding processes related to that interest.

On August 10, 2018, the chief of business development at Company P had a discussion with Mr. Patton indicating the Company P would not be likely to bid for CASMED. CASMED management held a follow up discussion with members of Company P on August 16, 2018 during which call Company P provided their analysis which they felt did not support a bid for CASMED.

On October 10, 2018, Mr. Patton provided the CASMED board of directors with an update on all strategic activities.

On October 14, 2018, Mr. Patton met with representatives of Edwards Lifesciences at a trade show in San Francisco. The parties discussed various matters relating to the ongoing commercial collaboration between CASMED and Edwards Lifesciences.

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On October 22, 2018, Mr. Patton met with representatives of Edwards Lifesciences in Irvine. At that meeting Edwards Lifesciences indicated potential renewed interest in an acquisition of CASMED.

On October 29, 2018, Mr. Patton and an executive of Edwards Lifesciences had a brief conversation regarding Edwards Lifesciences’ interest in acquiring CASMED for $2.25 per common share in an all cash transaction subject to certain conditions, including additional due diligence. CASMED received a written indication of interest from Edwards Lifesciences shortly after the call.

CASMED’s board of directors met on October 31, 2018 to consider Edwards Lifesciences’ offer. Joining the call were representatives from William Blair and CASMED’s outside counsel, Wiggin and Dana LLP, which we refer to in this proxy statement as Wiggin. Mr. Patton updated the CASMED board of directors regarding the recent discussions with Edwards Lifesciences, and William Blair provided background information on Edwards Lifesciences, and an analysis of the offer compared to the trading price of CASMED stock, and similar transactions. The CASMED board of directors considered the likelihood of other potential bidders and William Blair advised on a strategy to conduct a market check by re-contacting a subset of the 38 companies that had been contacted previously, in order to refresh their knowledge of CASMED’s performance and attempt to engage in substantive discussions to provide an alternative bid. After discussion, the board of directors authorized William Blair to provide an oral counter offer of  $3.00 per share to Edwards Lifesciences.

In subsequent conversations between William Blair and Edwards Lifesciences’ financial advisors it was communicated that while the companies recognized that their respective view of value was far apart, substantial due diligence and document drafting would be useful in an attempt to narrow that gap. Thereafter, and throughout the period from November until the execution of the definitive merger agreement in February 2019, CASMED cooperated in substantial due diligence activities by Edwards Lifesciences including a formal due diligence kick-off meeting with various Edwards Lifesciences team members in New York City on November 8, 2018.

On November 2, 2018, William Blair contacted Company A, Company B and Company J again. Company A indicated that it was officially not interested in bidding for CASMED.

On November 5, 2018, William Blair contacted Company Q and followed up with a packet of non-confidential information on CASMED. On November 6, 2018, William Blair contacted Company J and Company P again and provided them with a packet of non-confidential information on CASMED.

On November 8, 2018, Edwards Lifesciences entered into a non-disclosure agreement with CASMED.

On November 8, 2018, Company P indicated to William Blair that it officially was not interested in bidding for CASMED.

On November 15, 2018, William Blair contacted Company C again and provided it with a packet of non-confidential information on CASMED.

On November 19, 2018, Company B and Company C indicated to William Blair that they were officially not interested in bidding for CASMED.

On November 26, 2018, Mr. Patton had a telephone conversation with the CEO of Company J who indicated a possible change in strategy that would increase its interest in CASMED. The CEO of Company J indicated that he would follow up with a decision regarding their interest in a few days. After execution of a non-disclosure agreement on November 28, 2018, CASMED made certain financial and other due diligence information available to Company J on November 30, 2018, and thereafter, and conducted various calls on due diligence topics. On December 12, 2018, Mr. Patton met with certain executives of Company J at its offices while others participated by conference call.

Upon request from a corporate development executive in a division of Company Q, CASMED began to explore interest from Company Q and, following execution of a non-disclosure agreement on December 6, 2018, on December 7, 2018, due diligence information was made available. On December 14, 2018, certain executives of CASMED held a teleconference call with executives of Company Q.

On December 13, 2018, CASMED management and William Blair led a discussion at a meeting of the CASMED board of directors regarding the recent strategic discussions including results of the additional outreach previously authorized by the CASMED board of directors.

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On December 18, 2018, Company Q communicated to William Blair that while interest by some executives at the division level to acquire CASMED was high, the process had not yet gained full consensus at the division level, nor at the corporate level. Therefore, it was likely that if corporate interest in acquiring CASMED were to materialize, it would take many months.

On December 21, 2018, Edwards Lifesciences’ outside counsel, Pepper Hamilton LLP, which we refer to herein as Pepper Hamilton, provided CASMED and Wiggin with an initial draft of the merger agreement.

On January 4, 2019, Company R entered into a non-disclosure agreement with CASMED. William Blair contacted the chief business development executive of Company R, resulting in an exchange of certain financial and other non-public information and a meeting with that executive in San Francisco on January 9, 2019. At that meeting Company R indicated that although CASMED was not an obvious strategic fit for Company R, they would keep it in mind as their M&A strategy developed over time.

On January 4, 2019, Wiggin provided Edwards Lifesciences and Pepper Hamilton with comments on the draft merger agreement.

On January 10, 2019, after a brief call, Edwards Lifesciences submitted a revised written indication of interest to purchase CASMED for $2.35 per common share subject to certain conditions.

The CASMED board of directors held a meeting on January 15, 2019 to consider the revised indication of interest. Mr. Patton provided an update regarding the substantial due diligence that had occurred over the previous two months, and, along with a representative from Wiggin, provided a qualitative assessment of the draft merger agreement provided by Edwards Lifesciences. William Blair personnel provided a detailed analysis of the offer relative to various metrics including precedent transactions and premiums to CASMED’s stock trading history. William Blair updated the history of outreach to other entities and noted that of the 38 parties initially contacted, 9 were re-contacted recently resulting in ongoing discussions with four entities; Edwards Lifesciences, Company J, Company Q and Company R. After further discussion, the board of directors authorized William Blair to provide an oral counter-offer to Edwards Lifesciences of  $2.65 per share.

After discussions between Wiggin and Pepper Hamilton representatives on January 11, 2019, Pepper Hamilton delivered a revised draft of the merger agreement on the evening of January 15, 2019.

After continued due diligence cooperation, the CEO of Company J on January 16, 2019 had a phone call with a CASMED board member and indicated the likelihood that Company J would be in a position to provide an offer for CASMED within two weeks.

On January 18, 2019, Mr. Patton had a conversation with an executive of Edwards Lifesciences. During that call, the executive indicated that due diligence had revealed the need for more post acquisition integration and other costs than previously believed, but regardless Edwards Lifesciences was prepared to acquire CASMED for $2.45 per common share. That offer was characterized as a “best and final” offer, and shortly after the call a written indication of interest at that share price was received by CASMED.

After further discussions with each of the members of the CASMED board of directors, on January 21, 2019, Mr. Patton, in a phone call with an executive from Edwards Lifesciences, discussed the potential ability of Edwards Lifesciences to increase its bid to $2.50 per share, and Edwards Lifesciences agreed to consider the request and subsequently requested answers to additional due diligence questions.

On January 24, 2019, CASMED held a meeting of its board of directors at which the board of directors was updated on the status of negotiations and the status of the terms of the draft merger agreement that included certain conditions to closing that were undesirable, from CASMED’s perspective.

On January 25, 2019, Wiggin provided Edwards Lifesciences and Pepper Hamilton with additional comments on the proposed merger agreement.

On January 25, 2019, Company J indicated through William Blair that it likely would be able to communicate a bid for CASMED on February 1, 2019.

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On January 29, 2019, an executive of Edwards Lifesciences had a phone conversation with Mr. Patton. During that call, Edwards Lifesciences reaffirmed its position that its last written indication of interest bid of  $2.45 per common share was to be considered its “best and final” offer. A discussion ensued regarding certain closing conditions contained in the draft merger agreement with Mr. Patton indicating that CASMED was reluctant to enter into a merger agreement without revisions to such conditions. Mr. Patton suggested that Edwards Lifesciences’ offer of  $2.45 per share needed to be considered together with a fully negotiated merger agreement with mutually acceptable closing conditions. Edwards Lifesciences agreed to continue to work on the issue through its counsel.

In a phone call between Mr. Patton and the CEO and a business development executive of Company J on February 1, 2019, Company J indicated that it would be interested in acquiring CASMED, but would be willing to do so in the range of values between the equivalent of  $0.81 and $1.32 per share, acknowledging that such a range was well below the current market price of CASMED common stock.

On February 1, 2019, Pepper Hamilton provided Wiggin and CASMED with additional comments on the proposed merger agreement. After further negotiations between counsel via telephone on February 4, 2019, Pepper Hamilton provided Wiggin and CASMED with a revised draft of the merger agreement on February 5, 2019.

On February 6, 2019, CASMED held a board meeting. During that meeting the board was updated by management, William Blair, and counsel regarding the status of the negotiations with Company J and Edwards Lifesciences along with progress towards an acceptable merger agreement with Edwards Lifesciences. The board rejected the offer from Company J and authorized counsel to continue to negotiate the merger agreement with Edwards Lifesciences to seek to finalize the documentation.

Through the weekend of February 9-10, 2019 and into February 11, 2019 executives, advisors and counsel for CASMED and Edwards Lifesciences held a conference call and engaged in further email communications to discuss final matters related to documentation, due diligence and communication strategies in the event the CASMED board of directors agreed to proceed with the transaction. Counsel continued to exchange drafts of the merger agreement.

In the late afternoon of February 11, 2019, the board of directors of CASMED met. Representatives from Wiggin summarized the board’s fiduciary obligations under Delaware law with respect to the offer and the sale process. Representatives from William Blair provided an overview of the marketing process for the transaction and described in detail the process that it used to evaluate the fairness of the consideration to be paid by Edwards in the transaction. Representatives of William Blair then rendered to the board of directors its opinion (which was subsequently confirmed in writing by delivery of a written opinion dated February 11, 2019) that, as of February 11, 2019 and based on and subject to the procedures followed and assumptions set forth in the written opinion, the $2.45 per share to be paid by Edwards to the CASMED stockholders (other than dissenting stockholders and Edwards, Merger Subs and their affiliates) is fair, from a financial point of view, to the CASMED stockholders. Wiggin representatives then reviewed in detail the terms of the merger agreement, noting, among other things, the closing conditions and the fiduciary out, under certain circumstances, in the event of CASMED receiving a subsequent third party offer. After discussion, the board of directors unanimously (1) approved the execution, delivery, and performance of the merger agreement, (2) determined that entering into the merger agreement was in the best interests of CASMED and its stockholders, (3) declared the merger agreement and the merger advisable, and (4) subject to its fiduciary obligations, resolved to recommend that CASMED’s stockholders adopt the merger agreement.

In the evening of February 11, 2019, the parties executed and delivered the merger agreement. Prior to the opening of trading in the U.S. securities markets on February 12, 2019, CASMED and Edwards Lifesciences issued a joint press release announcing the transaction.

Reasons for the Merger; Recommendation of Our Board of Directors

Reasons for the Merger

Our board of directors, with the advice and assistance of our management and legal and financial advisors, at a meeting on February 11, 2019, carefully evaluated the proposed merger, including the terms and conditions of the merger agreement. Our board of directors unanimously (1) approved the execution,

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delivery, and performance of the merger agreement, (2) determined that entering into the merger agreement is in the best interests of CASMED and its stockholders, (3) declared the merger agreement and the merger advisable, and (4) subject to its fiduciary obligations, resolved to recommend that CASMED’s stockholders adopt the merger agreement.

In the course of reaching its determination, our board of directors consulted with our management and its legal and financial advisors and considered a number of substantive factors and potential benefits of the merger. Our board of directors believed that, taken as a whole, the following factors supported its decision to approve the proposed merger (not necessarily in order of relative importance):

•

the board of directors’ familiarity with CASMED’s business, operations, assets, properties, business strategy and competitive position and the nature of the industry in which CASMED operates, industry trends, and economic and market conditions, both on a historical and on a prospective basis;

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the financial condition and prospects of CASMED, as well as the risks involved in achieving those prospects and the short- and long-term risks and uncertainties associated with operating CASMED’s business, including:

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certain macroeconomic factors, including the material impact of another potential global economic downturn, and how these factors could impact CASMED;

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CASMED’s current financial plan, including the risks associated with achieving and executing upon CASMED’s business plan;

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pricing pressures associated with being a smaller stand-alone company in the medical device industry;

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our need for additional capital to pursue our business strategy and the potential risks and uncertainties associated with our ability to raise such additional capital;

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the costs of such capital, including the potentially dilutive impact to our existing stockholders;

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current and anticipated future competition for our products and our ability to compete successfully in light of the nature of the medical device industry, the presence of many larger, well-financed competitors, and our need to continue to develop and commercialize additional products;

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increasing and changing regulatory, reimbursement and compliance requirements for operating as a publicly held medical device company in the United States and international markets, and the challenges faced by small medical device companies in managing those requirements;

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potential pressures arising from customer consolidation, including pricing pressure; and

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the other risks described in CASMED’s filings with the SEC (see “Where You Can Find More Information” beginning on page 93 of this proxy statement);

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the fact that CASMED conducted an extensive, thorough, and diligent strategic alternatives review process which included assistance from William Blair in an effort to obtain the best value reasonably available to CASMED stockholders;

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the board of directors’ belief that, after consideration of potential alternatives and the potential benefits, risks and uncertainties associated with such alternatives, the merger is expected to provide greater benefits and less risk to CASMED’s stockholders than the range of possible alternatives to the sale of CASMED to Edwards, including continuing to operate CASMED on a standalone basis, an acquisition of CASMED by or a “merger of equals” with another competitor, or growth of CASMED through acquisitions;

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•

the fact that the $2.45 per share merger consideration contemplated to be received by CASMED’s common stockholders in connection with the merger represents an attractive value for the shares

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of our common stock and a premium to CASMED’s historic trading prices, including (1) a premium of 56.1% over CASMED’s closing sale price of  $1.57 on the NASDAQ on February 11, 2019 and (2) a premium of 25.6% over CASMED’s one year volume weighted average closing price of  $1.95 on the NASDAQ for the period ended February 11, 2019;

•

the oral opinion of William Blair rendered on February 11, 2019, which opinion was subsequently confirmed in a written opinion dated February 11, 2019, to the CASMED board of directors to the effect that, as of that date and based upon and subject to the qualifications, limitations and assumptions stated in its written opinion, the consideration to be offered to the holders of CASMED common stock in the merger was fair, from a financial point of view, to such stockholders, as more fully described below under the caption “ — Opinion of CASMED’s Financial Advisor”;

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•

the board of directors’ belief, based on the course and history of the negotiations between Edwards and CASMED, that the consideration set forth in the merger agreement represented the highest consideration that Edwards was willing to pay;

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•

the form of consideration to be paid to holders of shares in the merger is cash, which will provide immediate liquidity and certainty of value to CASMED’s stockholders compared to a transaction in which stockholders would receive stock, and the board weighed the certainty of realizing a compelling value for shares of our common stock by virtue of the merger against the uncertain prospect that the trading value for our common stock would approach the per share merger consideration in the foreseeable future, in light of the market performance of CASMED common stock relative to those of other participants in our industry and general market indices, as well as the risks and uncertainties associated with our business;

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the availability in the merger of appraisal rights for CASMED stockholders who properly exercise their statutory appraisal rights under Delaware law;

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the fact that the board consisted of a majority of independent directors who approved the transaction following extensive discussions with CASMED’s management team, representatives of financial advisers and outside legal counsel, and also took into consideration the financial expertise and prior industry experience held by a number of directors;

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the board of directors’ review, with CASMED’s advisors, of the structure of the merger and the financial and other terms of the merger agreement, and the board’s belief, based on the course and nature of negotiations with Edwards, which were conducted at arm’s length, that these were the most favorable terms available to CASMED and our stockholders on which Edwards, or an alternative purchaser, would be willing to transact. In particular, the board of directors considered the following specific aspects of the merger agreement, among others:

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CASMED’s ability, subject to the limitations and requirements contained in the merger agreement, to engage in negotiations with, and provide information to, a third party that makes an unsolicited written acquisition proposal, and ultimately terminate the merger agreement to accept a “company superior proposal” from a third party under certain circumstances and subject to certain conditions, including the payment to Edwards of a $3.5 million termination fee, if the board of directors determines in good faith, after consultation with its outside legal and financial advisors, that such proposal constitutes or would reasonably be expected to lead to a company superior proposal and that the failure to take such action would be inconsistent with the directors’ fiduciary duties under applicable law;

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the scope of the conditions to closing and the nature of the representations, warranties, and the covenants and agreements of the parties; and

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the requirement that CASMED obtain stockholder approval as a condition to completion of the merger;

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the willingness of certain stockholders, including certain directors and executive officers of CASMED, who together, as of February 11, 2019, held (i) 100% of the Series A Convertible

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Preferred Stock, (ii) 100% of the Series A Exchangeable Preferred Stock and (iii) approximately 26.1% of the voting power of the CASMED common stock, Series A Convertible Preferred Stock and Series A Exchangeable Preferred Stock voting as a single class, to commit to vote in favor of the merger by entry into the voting agreements. The board also considered the fact that the voting agreements terminate upon any termination of the merger agreement, including upon CASMED’s termination to accept a Company Superior Proposal, such that the existence of the voting agreements would not be likely to deter or inhibit a Company Superior Proposal; and

•

the board of directors’ belief that the merger is likely to be consummated, which belief is based on, among other things, the limited number of conditions to the merger, the absence of a financing condition, Edwards’ representation that it will have sufficient financial resources to pay the aggregate merger consideration and consummate the merger, the relative likelihood of obtaining required regulatory approvals, the remedies available under the merger agreement to CASMED in the event of various breaches by Edwards, and Edwards Lifesciences Corporation’s reputation in the medical device industry, which the board believed supported the conclusion that a transaction with Edwards could be completed relatively quickly and in an orderly manner.

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In addition, the board of directors was aware of and considered the interests that certain individuals, including our directors and executive officers, may have with respect to the merger that may differ from, or may be in addition to, their interests as stockholders of CASMED, as described in the section of this proxy statement entitled “ — Interests of Certain Persons in the Merger.”

Our board of directors also considered potential risks or negative factors relating to the merger, including but not limited to the following:

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the potential effect of the public announcement of CASMED entering into the merger agreement on our operations, including our relationships with customers, distributors, vendors and employees, and the potential adverse effects on our financial results as a result of that disruption, as well as the possibility of any suit, action or proceeding in respect of the merger agreement or the transactions contemplated thereby;

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the risks and costs to CASMED if the merger does not close, including the effect of an announcement of termination of the transaction on the trading price of our common stock, operating results and our relationships with customers, suppliers and employees;

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the risk that entering into the merger agreement may result in the loss of interest by other parties to make a definitive proposal for our acquisition at a price that may be higher than the $2.45 per share to be received by the stockholders;

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that the price being paid for each share of common stock in the merger is approximately 9.3% below the 52 week high sales price of our common stock on August 10, 2018;

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the ability to attract and retain key personnel and the risk of diverting management focus and employee resources from important business opportunities and operational matters during the pendency of the merger, which could adversely affect our business;

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the risks associated with various provisions of the merger agreement, including:

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the fact that the merger agreement contains certain limitations (subject to the consent of Edwards) regarding the operation of CASMED’s business during the period between the signing of the agreement and completion of the merger, which may delay or prevent CASMED from undertaking potential business opportunities that may arise or may negatively affect our ability to attract, retain and motivate key personnel;

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the risk that CASMED might not receive the necessary regulatory approvals and clearances;

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a covenant prohibiting CASMED from directly or indirectly soliciting, seeking, initiating, encouraging, facilitating or taking actions that would lead to other potential Company Acquisition Proposals. The board also considered, but did not consider preclusive, the fact

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that the right afforded to Edwards under the merger agreement to re-negotiate the terms of the merger agreement in response to a Company Superior Proposal may discourage other parties that might otherwise have an interest in a business combination with, or an acquisition of, CASMED;

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the requirement that CASMED must pay to Edwards a termination fee of  $3.5 million if the merger agreement is terminated under certain circumstances, including to accept a Company Superior Proposal, which might discourage other parties potentially interested in an acquisition of, or combination with, CASMED from pursuing that opportunity. See the sections of this proxy statement entitled “The Merger Agreement — Termination Fees and Reimbursement of Expenses.” The board of directors, after consultation with its legal and financial advisors, believed that the termination fee payable by CASMED in such circumstance under the merger agreement was reasonable in light of the size and benefits of the contemplated transaction with Edwards and was not preclusive of a company superior proposal, if one were to emerge; and

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a provision requiring CASMED to reimburse Edwards up to $1.0 million of certain of its transaction expenses in the event the merger agreement is terminated by either Edwards or CASMED following a failure to obtain the required vote of our stockholders to adopt the merger agreement. The board also recognized that the provisions in the merger agreement relating to these fees were insisted upon by Edwards as a condition to entering into the merger agreement;

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the fact that if the merger is consummated, CASMED will no longer exist as an independent company and CASMED’s stockholders will no longer participate in CASMED’s potential future earnings and growth or in any potential future sale of CASMED’s business to a third party;

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the fact that consummation of the merger is subject to the satisfaction of certain closing conditions that are not within our control, including receipt of the necessary regulatory clearances and approvals and that no Company Material Adverse Effect on CASMED has occurred. There can be no assurance that all conditions to the parties’ obligations to consummate the merger will be satisfied, and as a result, it is possible that the merger may not be consummated even if the merger is approved by our stockholders. The board of directors considered the fact that if the merger is not consummated (i) we will have incurred significant transaction and opportunity costs, including the possibility of disruption to our operations, diversion of management and employee attention, employee attrition and a potentially negative effect on our business and customer relationships; (ii) the trading price of our common stock could be adversely affected; and (iii) the market’s perceptions of our prospects could be adversely affected;

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the risk that certain of our directors, executive officers, and their associates may have interests in the transactions contemplated by the merger agreement as individuals that are in addition to, or that may be different from, the interests of our stockholders. See “Proposal 1: Adoption of the Merger Agreement — Interests of Certain Persons in the Merger” beginning on page 49 of this proxy statement; and

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the fact that the merger will be a taxable transaction to our stockholders that are U.S. Holders for U.S. federal income tax purposes; and, therefore, such stockholders generally will be required to pay U.S. federal income tax on any gains they recognize as a result of the merger.

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The foregoing discussion summarizes certain material factors considered by the board of directors in its consideration of the merger and is not intended to be exhaustive. In view of the wide variety of factors considered by the board of directors, and the complexity of these matters, the board of directors did not find it practicable to quantify or otherwise assign relative weights to the foregoing factors. In addition, individual members of the board of directors applied his or her own personal business judgment to the process and may have assigned different weights to various factors. The board did not undertake to make any specific determination as to whether any factor, or any particular aspect of any factor, supported or did not support its ultimate determinations. The board based its recommendation on the totality of the information presented, including thorough discussions with, and questioning of, our senior management and outside financial advisor and legal counsel.

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Our board of directors concluded that the potentially negative factors associated with the merger agreement were substantially outweighed by the opportunity for CASMED’s stockholders to realize a premium on the value of their shares of CASMED stock. Accordingly, our board of directors, by unanimous vote, (1) approved the execution, delivery, and performance of the merger agreement, (2) determined that entering into the merger agreement is in the best interests of CASMED and its stockholders, (3) declared the merger agreement and the merger advisable, and (4) subject to its fiduciary obligations, resolved to recommend that CASMED’s stockholders adopt the merger agreement.

It should be noted that this explanation of the reasoning of the board and certain information presented in this section is forward-looking in nature and should be read in light of the factors set forth in “Cautionary Statement Concerning Forward-Looking Information” beginning on page 19 of this proxy statement.

Recommendation of our Board of Directors

Our board of directors recommends that you vote “FOR” the proposal to adopt the merger agreement and approve the merger.

Opinion of William Blair & Company, L.L.C.

William Blair was retained to act as financial advisor to the board of directors in connection with the possible sale of CASMED. As part of its engagement, the board of directors requested that William Blair render an opinion to the board of directors as to whether the merger consideration to be received by holders of CASMED common stock (other than (i) holders who have properly exercised appraisal rights and (ii) Edwards, Merger Sub, any of their respective affiliates) was fair, from a financial point of view, to such holders. On February 11, 2019, William Blair delivered its oral opinion to the board of directors (subsequently confirmed in writing) that, as of February 11, 2019 and based upon and subject to the assumptions, qualifications and limitations stated therein, the $2.45 per share in cash to be received by holders of CASMED common stock (other than (i) holders who have properly exercised appraisal rights and (ii) Edwards, Merger Sub, any of their respective affiliates) was fair, from a financial point of view, to such holders.

THE FULL TEXT OF WILLIAM BLAIR’S WRITTEN OPINION, DATED FEBRUARY 11, 2019, IS ATTACHED AS ANNEX C TO THIS PROXY STATEMENT AND INCORPORATED INTO THIS PROXY STATEMENT BY REFERENCE. YOU ARE URGED TO READ THE FAIRNESS OPINION CAREFULLY AND IN ITS ENTIRETY TO LEARN ABOUT THE ASSUMPTIONS MADE, PROCEDURES FOLLOWED, MATTERS CONSIDERED AND LIMITS ON THE SCOPE OF THE REVIEW UNDERTAKEN BY WILLIAM BLAIR IN RENDERING ITS OPINION. THE ANALYSIS PERFORMED BY WILLIAM BLAIR SHOULD BE VIEWED IN ITS ENTIRETY; NONE OF THE METHODS OF ANALYSIS SHOULD BE VIEWED IN ISOLATION. WILLIAM BLAIR’S FAIRNESS OPINION WAS DIRECTED SOLELY TO THE BOARD OF DIRECTORS FOR ITS USE AND BENEFIT IN EVALUATING THE FAIRNESS OF THE MERGER CONSIDERATION AND RELATES ONLY TO THE FAIRNESS, AS OF THE DATE OF WILLIAM BLAIR’S FAIRNESS OPINION AND FROM A FINANCIAL POINT OF VIEW, OF THE MERGER CONSIDERATION TO BE RECEIVED BY THE HOLDERS OF CASMED COMMON STOCK (OTHER THAN (I) HOLDERS WHO HAVE PROPERLY EXERCISED APPRAISAL RIGHTS AND (II) EDWARDS, MERGER SUB, ANY OF THEIR RESPECTIVE AFFILIATES) IN THE PROPOSED MERGER PURSUANT TO THE MERGER AGREEMENT. WILLIAM BLAIR’S FAIRNESS OPINION DOES NOT ADDRESS ANY OTHER ASPECTS OF THE PROPOSED MERGER OR ANY RELATED TRANSACTION, AND DOES NOT CONSTITUTE A RECOMMENDATION TO ANY OF CASMED’S STOCKHOLDERS AS TO HOW SUCH STOCKHOLDER SHOULD VOTE WITH RESPECT TO THE MERGER. WILLIAM BLAIR DID NOT ADDRESS THE MERITS OF THE UNDERLYING DECISION BY CASMED TO ENGAGE IN THE MERGER. THE FOLLOWING SUMMARY OF WILLIAM BLAIR’S FAIRNESS OPINION IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE FULL TEXT OF ITS FAIRNESS OPINION ATTACHED TO THIS PROXY STATEMENT AS ANNEX C.

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In connection with William Blair’s review of the merger and the preparation of its opinion, William Blair examined, among other things:

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a draft of the merger agreement dated February 9, 2019;

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audited historical financial statements for CASMED set forth in its public filings with the SEC for the three fiscal years ended December 31, 2015, 2016 and 2017;

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unaudited financial statements of CASMED set forth in its public filings with the SEC for the nine month periods ended September 30, 2017 and 2018;

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preliminary net sales of CASMED as set forth in its Form 8-K filed with the SEC on January 3, 2019, for the quarter and year ended December 31, 2018;

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preliminary unaudited financial information for the year ended December 31, 2018 prepared by senior management of CASMED;

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certain internal business operating and financial information and forecasts of CASMED for the fiscal years ending December 31, 2019 through December 31, 2023, prepared by the senior management of CASMED and provided to William Blair on February 4, 2019 (the “Forecasts”);

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information regarding publicly available financial terms of certain other transactions William Blair deemed relevant;

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information regarding certain publicly traded companies that William Blair deemed relevant;

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current and historical market prices and trading volumes of the CASMED common stock; and

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certain other publicly available information on CASMED.

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William Blair also held discussions with members of the senior management of CASMED to discuss the foregoing, considered other matters that it deemed relevant to its inquiry, and took into account the accepted financial and investment banking procedures and considerations that it deemed relevant. In connection with William Blair’s engagement, it was requested to approach, and held discussions with, third parties to solicit indications of interest in a possible acquisition of CASMED.

In rendering its opinion, William Blair assumed and relied, without any independent verification, upon the accuracy and completeness of all the financial, legal, regulatory, tax, accounting and other information provided to, examined by, or otherwise reviewed or discussed with, William Blair for purposes of its fairness opinion including, without limitation, the Forecasts provided by the senior management of CASMED. William Blair has not made or obtained an independent valuation or appraisal of the assets, liabilities or solvency of CASMED. William Blair has been advised by the senior management of CASMED that the Forecasts examined by William Blair have been reasonably prepared on bases reflecting the best currently available estimates and judgments of the senior management of CASMED. In that regard, William Blair assumed, with the consent of the board of directors, that (i) the Forecasts would be achieved in the amounts and at the times contemplated thereby and (ii) all material assets and liabilities (contingent or otherwise) of CASMED are as set forth in CASMED’s financial statements or other information made available to William Blair. William Blair did not express an opinion with respect to the Forecasts or the estimates and judgments on which they are based. William Blair did not consider and expressed no opinion as to the amount or nature of the compensation to any of CASMED’s officers, directors or employees (or any class of such persons) relative to the merger consideration payable to CASMED’s other stockholders. William Blair was not asked to consider, and its opinion did not address, the relative merits of the merger as compared to any alternative business strategies that might exist for CASMED or the effect of any other transaction in which CASMED might engage. William Blair’s opinion was based upon economic, market, financial and other conditions existing on, and other information disclosed to William Blair as of, the date of its opinion. It should be understood that, although subsequent developments may affect William Blair’s opinion, William Blair does not have any obligation to update, revise or reaffirm its opinion. William Blair relied as to all legal matters related to the merger on advice of counsel to CASMED, and assumed that the merger will be consummated on the terms described in the draft merger agreement dated February 9, 2019,

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without any amendment or waiver of any material terms or conditions by CASMED. William Blair expressed no opinion as to the price at which the shares of CASMED common stock will trade at any future time or as to the effect of the announcement of the merger on the trading price of such shares.

William Blair’s investment banking services and its opinion were provided for the use and benefit of the board of directors in connection with its consideration of the transactions contemplated by the merger agreement. William Blair’s opinion was limited to the fairness, from a financial point of view, to the holders of CASMED common stock (other than (i) holders who have properly exercised appraisal rights and (ii) Edwards, Merger Sub, any of their respective affiliates) of the merger consideration in connection with the merger, and William Blair did not address the merits of the underlying decision by CASMED to engage in the merger and its opinion does not constitute a recommendation to any CASMED stockholder as to how such stockholder should vote with respect to the merger. William Blair’s opinion was reviewed and approved by its Fairness Opinion Committee.

The following is a summary of the material financial analyses performed and material factors considered by William Blair to arrive at its opinion. William Blair performed certain procedures, including each of the financial analyses described below, and reviewed with the board of directors the assumptions upon which such analyses were based, as well as other factors. Although the summary does not purport to describe all of the analyses performed or factors considered by William Blair in this regard, it does set forth those considered by William Blair to be material in arriving at its fairness opinion. The financial analyses summarized below include information presented in a tabular format. In order to fully understand the financial analyses performed by William Blair, the tables must be read together with the text of each summary. The tables alone do not constitute a complete description of the financial analyses performed by William Blair. Considering the data set forth in the tables below without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of the financial analyses performed by William Blair. The order of the summaries of analyses described below does not represent the relative importance or weight given to those analyses by William Blair.

Selected Publicly Traded Companies Analysis

William Blair reviewed and compared certain financial information relating to CASMED to corresponding financial information, ratios and public market multiples for 14 publicly traded medical device companies with similar business models or financial profiles that William Blair deemed relevant, based on William Blair’s professional judgment. The companies selected by William Blair were: (i) MISONIX, Inc., (ii) Restoration Robotics Inc., (iii) Viveve Medical, Inc., (iv) AngioDynamics, Inc., (v) AtriCure, Inc., (vi) Cardiovascular Systems, Inc., (vii) CONMED Corporation, (viii) Glaukos Corporation; (ix) Intersect ENT, Inc., (x) LeMaitre Vascular, Inc., (xi) Nevro Corp., (xii) OrthoPediatrics Corp., (xiii) STAAR Surgical Company and (xiv) Tactile Systems Technology, Inc. Public companies (i) through (iii) were identified as “micro cap” companies (which William Blair defined as companies with a market capitalization under $300 million) and public companies (iv) through (xiv) were identified as “small cap” companies (which William Blair defined as companies with a market capitalization between $300 million and $2.8 billion). In identifying the selected public companies, William Blair considered the following information relating to CASMED as compared to corresponding information for each of the selected public companies: (i) the expected revenue growth from calendar year 2018 to calendar year 2019 and (ii) gross margin for the last twelve month (“LTM”) period. The expected revenue growth for CASMED was derived from preliminary amounts stated in its Current Report on Form 8-K filed with the SEC on January 3, 2019 along with the Forecasts provided by senior management of CASMED and the expected revenue growth for the selected public companies was derived from the most recent publicly available information regarding such companies, which was adjusted to reflect acquisitions that had a material impact on results. The gross margin for CASMED was reviewed for the LTM period ended December 31, 2018, based on preliminary amounts of net sales for 2018 stated in its Current Report on Form 8-K filed with the SEC on January 3, 2019 along with additional preliminary unaudited financial information prepared by senior management of CASMED, and William Blair reviewed the gross margin for the selected public companies for the most recent LTM period for which results were publicly available, which was adjusted to reflect acquisitions that had a material impact on results.

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William Blair considered the enterprise value for each company (including CASMED), which William Blair calculated as the equity value of the company, plus total debt, minority interest and preferred stock, less cash and cash equivalents. The equity value of each company was calculated using the closing stock price as of February 8, 2019 (the last trading day prior to William Blair’s distribution of its analysis to the board of directors), multiplied by the shares outstanding. William Blair considered the enterprise value as a multiple of revenue for each company for the LTM period for which results were publicly available and calendar year 2019 expected (“CY 2019E”) revenue for each company. The operating results and the corresponding derived multiples for CASMED were for the LTM period ended December 31, 2018, based on preliminary amounts stated in its Current Report on Form 8-K filed with the SEC on January 3, 2019, and for each of the selected public companies were based on each company’s most recent publicly available financial information and, in all cases, closing share prices as of February 8, 2019 (the last trading day prior to the entry into the merger agreement). William Blair then used the implied enterprise value based on the terms of the proposed merger to derive implied valuation multiples for CASMED based on LTM revenue and CY 2019E revenue. Implied valuation multiples based on CY 2019E revenue were assessed using both consensus research estimates (consisting of two estimates) and the Forecasts. William Blair compared the multiples implied for CASMED based on the terms of the proposed merger to the range of trading multiples for the aggregate group of selected public companies. Information regarding the multiples derived from William Blair’s selected public company analysis is set forth in the following table.

William Blair noted that, with respect to the enterprise value/LTM revenue valuation multiple, the analyzed implied valuation multiple for CASMED based on the merger was above the range multiples of the selected micro cap public companies and was within the range of multiples of the selected small cap public companies. William Blair also noted that, with respect to the enterprise value/CY 2019E revenue valuation multiples, both of the analyzed implied valuation multiples for CASMED based on the merger were above the range of multiples of the selected micro cap companies and were within the range of multiples of the selected small cap companies.

Although William Blair compared the trading multiples of the selected public companies to those implied for CASMED, none of the selected public companies is directly comparable to CASMED. Accordingly, any analysis of the selected public companies involves considerations and judgments concerning the differences in financial and operating characteristics and other factors that would affect the analysis of trading multiples of the selected public companies.

Selected Precedent Transactions Analysis

William Blair performed an analysis of 18 selected business combinations consisting of transactions announced subsequent to January 1, 2010 within the monitoring, patient safety and disposable devices sectors with revenues of less than $100 million that William Blair deemed relevant. William Blair’s analysis was based solely on publicly available information regarding such transactions. William Blair did not take into account any announced or consummated transaction whereby relevant financial information was not publicly disclosed and available. The selected transactions were not intended to be representative of the entire range of possible transactions in the respective industries. The transactions examined were (identified by target/acquirer and date of announcement):

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Buffalo Filter/CONMED Corporation (December 2018)

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Focal Therapeutics/Hologic (September 2018)

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Invuity/Stryker Corporation (September 2018)

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Cogentix Medical/Laborie Medical Technologies (March 2018)

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Entellus Medical/Stryker Corporation (December 2017)

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NOVADAQ Technologies/Stryker Corporation (June 2017)

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EndoChoice Holdings/Boston Scientific Corporation (September 2016)

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E.T. View Medical/Ambu A/S (June 2016)

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Smith & Nephew plc (Gynecology Business)/Medtronic (May 2016)

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Galil Medical/BTG (May 2016)

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Hansen Medical/Auris Health (April 2016)

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Synergetics USA/Valeant Pharmaceuticals (September 2015)

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New Wave Surgical Corporation/Covidien (March 2014)

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Patient Safety Technologies/Stryker Corporation (December 2013)

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Cardiocom/Medtronic (August 2013)

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Oridion Systems/Covidien (April 2012)

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O.R. Solutions/Ecolab (November 2010)

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Somanetics Corporation/Covidien (June 2010)

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William Blair reviewed the consideration paid in the selected transactions in terms of the enterprise value of such transactions as a multiple of revenue for the LTM period prior to the announcement of the applicable transaction. William Blair considered the transaction multiple of revenue for CASMED for the LTM period ended December 31, 2018, based on preliminary amounts stated in its Current Report on Form 8-K filed with the SEC on January 3, 2019, and compared it to the resulting range of transaction multiples of LTM revenue for the selected transactions. Information regarding the multiples from William Blair’s analysis of selected transactions is set forth in the following table:

William Blair noted that the implied valuation multiple of enterprise value/LTM revenue for CASMED based on the merger was within the range of multiples of the selected transactions.

Although William Blair analyzed the multiples implied by the selected transactions and compared them to the implied transaction multiple of CASMED, none of these transactions or associated companies is identical to CASMED or the transactions contemplated by the merger agreement. Accordingly, any analysis of the selected transactions necessarily involved complex considerations and judgments concerning the differences in financial and operating characteristics, parties involved and terms of their transactions and other factors that would necessarily affect the implied value of CASMED versus the values of the companies in the selected transactions.

Discounted Cash Flow Analysis

William Blair utilized the Forecasts to perform a discounted cash flow analysis of CASMED’s projected unlevered future free cash flows for the fiscal years ending December 31, 2019 through December 31, 2023. Using discounted cash flow methodology, William Blair calculated the present values of the projected unlevered free cash flows for CASMED. Unlevered free cash flows for CASMED were calculated by William Blair using after-tax EBIT (derived from the Forecasts, assuming a tax rate of 23% to

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EBIT), less capital expenditures and increase in net working capital (each derived from the Forecasts). William Blair then calculated the assumed terminal value of CASMED using two different methodologies: (i) multiplying projected revenue for CY 2023 (as set forth in the Forecasts) by exit multiples ranging from 3.00x to 5.00x, discounted back to December 31, 2018 and (ii) utilizing perpetuity growth rates ranging from 3.0% to 5.0% of free cash flow for future periods after CY 2023. To discount the projected unlevered free cash flows and assumed terminal value to present value, William Blair used discount rates ranging from 9.0% to 13.0%. The terminal value exit multiple range was derived from relevant precedent transactions and public company trading multiples, and the range of perpetuity growth rates was selected based on long term industry growth rates. The discount rate range was derived based upon William Blair’s estimate of CASMED’s weighted average cost of capital using the capital asset pricing model.

William Blair aggregated the present value of the projected unlevered free cash flows over the applicable forecast period with the present value of the range of terminal values calculated under each terminal value methodology to arrive at ranges of implied enterprise value. William Blair then derived ranges of implied equity values per share by deducting CASMED’s net debt as of December 31, 2018 (based on preliminary year end financials provided by CASMED’s management) and dividing such amount by CASMED’s total diluted outstanding shares as of January 31, 2019. This analysis resulted in a range of implied equity values of  $1.10 to $3.12 per share using the exit multiple methodology and a range of implied equity values of  $(0.72) to $0.30 per share using the perpetuity growth rate methodology, in each case as compared to the merger consideration of  $2.45 per share.

M&A Premiums Paid Analysis

William Blair reviewed data from 238 acquisitions of U.S. publicly traded companies announced since January 1, 2014 in which 100% of the target’s equity was acquired with equity values between $50 million and $200 million. Specifically, William Blair analyzed the acquisition price per share as a premium to the closing share price one day, one week, one month, 90 days, 180 days, 270 days and 365 days prior to the announcement of each transaction. William Blair compared the range of resulting per share common share price premiums for the reviewed transactions to the premiums implied by the proposed merger based on CASMED common stock prices one day, one week, one month, 90 days, 180 days, 270 days and 365 days prior to February 8, 2019 (the last trading day prior to the entry into the merger agreement). Information regarding the premiums from William Blair’s analysis of selected transactions is set forth in the following table:

Premium Paid Relative to February 8, 2019

William Blair noted for the board of directors that the merger consideration premium to CASMED’s closing stock prices one day and one week prior to February 8, 2019 was above the 50th percentile and below the 60th percentile of the analyzed precedent public transactions, the merger consideration premium to CASMED’s one month and 90-day prior closing prices was above the 30th and percentile and below the 40th percentile of the analyzed transactions, the merger consideration premium to CASMED’s 180-day prior closing price was below the 10th percentile of the analyzed transactions, the merger consideration premium to CASMED’s 270-day prior closing price was above the 70th percentile and below the 80th percentile of the analyzed transactions and the merger consideration premium to the 365-day prior closing price was above the 80th percentile and below the 90th percentile of the analyzed transactions.

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General

This summary is not a complete description of the analysis performed by William Blair, but contains the material elements of the analysis. The preparation of an opinion regarding fairness is a complex process involving various determinations as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances, and, therefore, such an opinion is not readily susceptible to partial analysis or summary description. The preparation of an opinion regarding fairness does not involve a mathematical evaluation or weighing of the results of the individual analyses performed, but requires William Blair to exercise its professional judgment, based on its experience and expertise, in considering a wide variety of analyses taken as a whole. Each of the analyses conducted by William Blair was carried out in order to provide a different perspective on the financial terms of the proposed merger and add to the total mix of information available. The analyses were prepared solely for the purpose of William Blair providing its opinion and do not purport to be appraisals or necessarily reflect the prices at which securities actually may be sold. William Blair did not form a conclusion as to whether any individual analysis, considered in isolation, supported or failed to support an opinion about the fairness of the merger consideration to be received by holders of CASMED common stock (other than (i) holders who have properly exercised appraisal rights and (ii) Edwards, Merger Sub, any of their respective affiliates). Rather, in rendering its oral opinion on February 11, 2019 (subsequently confirmed in writing) to the board of directors, as of that date and based upon and subject to the assumptions, qualifications and limitations stated in its written opinion, as to whether the merger consideration to be received by holders of CASMED’s common stock (other than (i) holders who have properly exercised appraisal rights and (ii) Edwards, Merger Sub, any of their respective affiliates) was fair, from a financial point of view, to such holders, William Blair considered the results of the analyses in light of each other and ultimately reached its opinion based on the results of all analyses taken as a whole. William Blair’s fairness opinion considered each valuation method equally and did not place any particular reliance or weight on any particular analysis, but instead concluded that its analyses, taken as a whole, supported its determination. Accordingly, notwithstanding the separate factors summarized above, William Blair believes that its analyses must be considered as a whole and that selecting portions of its analyses and the factors considered by it, without considering all analyses and factors, may create an incomplete view of the evaluation process underlying its opinion. No company or transaction used in the above analyses as a comparison is directly comparable to CASMED or the proposed transactions under the merger agreement. In performing its analyses, William Blair made numerous assumptions with respect to industry performance, business and economic conditions and other matters. The analyses performed by William Blair are not necessarily indicative of future actual values and future results, which may be significantly more or less favorable than suggested by such analyses.

William Blair has been engaged in the investment banking business since 1935. William Blair continually undertakes the valuation of investment securities in connection with public offerings, private placements, business combinations, estate and gift tax valuations and similar transactions. In the ordinary course of its business, William Blair may from time to time trade the securities of CASMED for its own account and for the accounts of its customers, and accordingly may at any time hold a long or short position in such securities. The board of directors hired William Blair based on its qualifications and expertise in providing financial advice to companies and its reputation as an internationally recognized investment banking firm.

Fees

Pursuant to a letter agreement dated April 1, 2016, a fairness opinion fee of  $250,000 became payable to William Blair upon delivery of its fairness opinion. A fee of approximately $2,490,000 less any fees previously paid to William Blair, will become payable to William Blair upon the consummation of the merger. No portion of the fees payable to William Blair were contingent on the conclusions reached by William Blair in William Blair’s fairness opinion. In addition, CASMED agreed to reimburse William Blair for certain of its out-of-pocket expenses (including fees and expenses of its counsel and any other independent experts retained by William Blair) reasonably incurred by it in connection with its services and will indemnify William Blair against potential liabilities arising out of its engagement, including certain liabilities under the U.S. federal securities laws.

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Certain Financial Forecasts

CASMED does not as a matter of general practice publicly disclose financial projections due to, among other reasons, the unpredictability of the underlying assumptions and estimates inherent in preparing financial projections. However, CASMED is including a summary of certain previously nonpublic, unaudited prospective financial information prepared by its management for the calendar years 2019-2023 (the “Forecasts”) in order to provide CASMED stockholders with access to information that was made available to CASMED’s board of directors in connection with its evaluation of the merger and the per share merger consideration. The Forecasts were made available to William Blair in connection with the rendering of William Blair’s fairness opinion to the board of directors. The Forecasts constitute forward-looking statements. See “Cautionary Statement Concerning Forward-Looking Information.”

Summary of Financial Forecasts

This summary of the Forecasts is not provided to influence your decision regarding whether to vote for the adoption of the merger agreement, but is only being included because such financial forecasts were made available to the CASMED board of directors and its advisors in evaluating CASMED’s strategic alternatives, including a potential transaction with Edwards. CASMED also prepares additional internal forecasts from time to time and provided certain forecasts for 2019 to Edwards and other potential bidders. These forecasts were superseded by the Forecasts described in the table below and were not relied upon by William Blair in connection with their fairness opinion nor by the board of directors in connection with their review and approval of the merger agreement and the merger. The inclusion of this information in this proxy statement should not be regarded as an indication that the CASMED board of directors or its advisors or any other person considered, or now considers, the Forecasts to be a reliable prediction of actual future results, and the Forecasts should not be relied upon as such. CASMED’s internal financial projections, upon which the Forecasts were based, are subjective in many respects. There can be no assurance that the Forecasts will be realized or that actual results will not be significantly higher or lower than projected. The Forecasts also cover multiple years and such information by its nature becomes subject to greater uncertainty with each successive year. Economic and business environments may change quickly, which adds an additional significant level of uncertainty as to whether the results portrayed in the Forecasts will be achieved. As a result, the inclusion of the Forecasts in this proxy statement does not constitute an admission or representation by CASMED that the information is material. Readers of this proxy statement are cautioned not to place undue reliance on the Forecasts set forth below.

Because our Forecasts were developed for CASMED on a standalone basis without giving effect to the merger, our Forecasts do not reflect any effects of the merger or any changes to our operations or strategy that may be implemented after the consummation of the merger, including cost synergies realized, or to any additional costs incurred.

Certain Projected Financial Information

The following table presents the Forecasts:

(1)

EBITDA represents projected earnings before interest, taxes depreciation and amortization. EBITDA is a “non-GAAP financial measure,” which represents a financial performance measure that is not calculated in accordance with GAAP. See “— Important Information About Our Financial Forecasts”, below for additional information.

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(2)

EBIT represents projected earnings before interest and taxes. EBIT is a “non-GAAP financial measure,” which represents a financial performance measure that is not calculated in accordance with GAAP. See “— Important Information About Our Financial Forecasts”, below for additional information.

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The Forecasts were developed by CASMED management on a standalone basis without giving effect to the merger and the other transactions contemplated by the merger agreement, or any changes to CASMED’s operations or strategy that may be implemented after the consummation of the merger, including any costs incurred in connection with the merger and the other transactions contemplated by the merger agreement. Furthermore, the Forecasts do not take into account the effect of any failure of the transactions contemplated by the merger agreement to be completed and should not be viewed as accurate or continuing in that context.

Important Information About Our Financial Forecasts

Our management believes that our Forecasts were prepared in good faith and on a reasonable basis on the best information available to our management at the time of their preparation. Our Forecasts, however, are not fact and should not be relied upon as necessarily indicative of actual future results, and actual results may differ materially from those contained in our Forecasts.

Although the Forecasts are presented with numerical specificity, they were based on numerous variables and assumptions made by CASMED management with respect to industry performance, general business, economic, regulatory, market and financial conditions and other future events, as well as matters specific to CASMED’s business, including but not limited to expectations for demand and sales of new and existing products, customer and supplier relationships, research and development programs, market and technology opportunities, international trends, business strategies, business opportunities, objectives of management for future operations, medical device industry growth and trends in the markets in which CASMED participates, all of which are difficult or impossible to predict accurately and many of which are beyond CASMED’s control.

The Forecasts constitute forward-looking information and are subject to many risks and uncertainties that could cause actual results to differ materially from the results forecasted in the Forecasts, including, but not limited to, CASMED’s performance, industry performance, general business and economic conditions, customer requirements, staffing levels, competition, adverse changes in applicable laws, regulations or rules, and the various risks set forth in CASMED’s reports filed with the SEC.

There can be no assurance that the Forecasts will be realized or that actual results will not be significantly higher or lower than forecast. In addition, the Forecasts will be affected by CASMED’s ability to achieve strategic goals, objectives and targets over the applicable periods. The Forecasts reflect assumptions as to certain business decisions that are subject to change and cannot, therefore, be considered a guarantee of future operating results, and this information should not be relied on as such. The inclusion of the Forecasts should not be regarded as an indication that CASMED, William Blair, their respective officers, directors, affiliates, advisors, or other representatives or anyone who received this information then considered, or now considers, them a reliable prediction of future events, and this information should not be relied upon as such. The inclusion of the Forecasts in this proxy statement should not be regarded as an indication that the Forecasts will be necessarily predictive of actual future events. No representation is made by CASMED or any other person regarding the Forecasts or CASMED’s ultimate performance compared to such information. The Forecasts should be evaluated, if at all, in conjunction with the historical financial statements and other information about CASMED contained in CASMED’s public filings with the SEC. For more information, please see the section of this proxy statement captioned “Where You Can Find More Information.” In light of the foregoing factors, and the uncertainties inherent in the Forecasts, stockholders are cautioned not to place undue, if any, reliance on the Forecasts.

The Forecasts were not prepared with a view toward public disclosure or with a view toward complying with the published guidelines of the SEC regarding projections or accounting principles generally accepted in the United States (“GAAP”), or the guidelines established by the American Institute of Certified Public

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Accountants with respect to prospective financial information. Neither CASMED’s independent auditor nor any other independent accountant has compiled, examined or performed any procedures with respect to the Forecasts, nor have they expressed any opinion or any other form of assurance on such information or its achievability.

EBITDA and EBIT contained in the Forecasts set forth above, are “non-GAAP financial measures,” which are financial performance measures that are not calculated in accordance with GAAP. These non-GAAP financial measures should not be viewed as a substitute for GAAP financial measures and may be different from non-GAAP financial measures used by other companies. Furthermore, there are limitations inherent in non-GAAP financial measures because they exclude charges and credits that are required to be included in a GAAP presentation. Accordingly, these non-GAAP financial measures should be considered together with, and not as an alternative to, financial measures prepared in accordance with GAAP. The summary of such information above is included solely to give stockholders access to the information that was made available to William Blair and CASMED’s board of directors, and is not included in this proxy statement in order to influence any stockholder to make any investment decision with respect to the merger, including whether or not to seek appraisal rights with respect to their shares of CASMED common stock.

In addition, the Forecasts have not been updated or revised to reflect information or results after the date they were prepared or as of the date of this proxy statement, and except as required by applicable securities laws, CASMED does not intend to update or otherwise revise the Forecasts or the specific portions presented to reflect circumstances existing after the date when made or to reflect the occurrence of future events, even in the event that any or all of the underlying assumptions are shown to be in error.

Effects on the Company if the Merger is Not Completed

If the merger agreement is not adopted by our stockholders or if the merger is not completed for any other reason, our stockholders will not receive any payment for their shares of CASMED common stock in connection with the merger. Instead, we will remain an independent public company, and CASMED common stock will continue to be quoted on the NASDAQ Capital Market and registered under the Exchange Act and we will continue to file periodic reports with the SEC.

Furthermore, if the merger is not consummated, and depending on the circumstances that would have caused the merger not to be consummated, it is likely that the price of our common stock will decline significantly. If that were to occur, it is uncertain when, if ever, the price of our common stock would return to the price at which it trades as of the date of this proxy statement.

If the merger is not consummated, we expect that our management will operate the business in a manner similar to that in which it is being operated today and that our stockholders will be subject to the same risks and opportunities to which our business is currently subject, but there can be no assurance as to the effect of these risks and opportunities on the future value of your shares of CASMED common stock. In the event the merger is not completed, our board of directors will continue to evaluate and review our business operations, projects and capitalization, make such changes as are deemed appropriate and seek to identify acquisitions, joint ventures or strategic alternatives to enhance stockholder value. If the merger agreement is not adopted by our stockholders or if the merger is not consummated for any other reason, there can be no assurance that any other transaction acceptable to us will be offered or that our business, prospects or results of operations will not be adversely impacted. If the merger agreement is terminated under certain circumstances, we may be obligated to pay Edwards a termination fee. See the section of this proxy statement entitled “The Merger Agreement — Termination Fees and Reimbursement of Expenses.”

Financing of the Merger

The obligations of CASMED under the merger agreement are not subject to a condition regarding Edwards’ or Merger Sub’s obtaining funds to consummate the merger and the other transactions contemplated by the merger agreement. Edwards has represented in the merger agreement that it will have available to it at the closing of the merger, sufficient cash to consummate the merger and to pay the aggregate merger consideration and any other amounts required to be paid by it in connection with the consummation of the transactions contemplated by the merger agreement.

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Material U.S. Federal Income Tax Consequences

The following is a general summary of material U.S. federal income tax consequences of the merger to U.S. holders whose shares of CASMED common stock are converted into the right to receive cash in the merger. This summary does not purport to consider all aspects of U.S. federal income taxation that might be relevant to our stockholders. For purposes of this summary, the term “U.S. holder” means a beneficial owner of shares of CASMED common stock that is, for U.S. federal income tax purposes:

•

an individual who is a citizen or resident of the United States;

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•

a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized under the laws of the United States or any of its political subdivisions;

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•

a trust if  (i) a U.S. court is able to exercise primary supervision over the trust’s administration and one or more U.S. persons is authorized to control all substantial interests of the trust; or (ii) it was in existence on August 30, 1996 and has a valid election in effect under applicable U.S. Treasury regulations to be treated as a domestic trust for U.S. federal income tax purposes; or

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an estate that is subject to U.S. federal income tax on its income regardless of its source.

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A “non-U.S. holder” is a beneficial owner (other than a partnership or any entity or arrangement treated as a partnership for U.S. federal income tax purposes) of CASMED common stock that is not a U.S. holder. If a partnership (including an entity treated as a partnership for U.S. federal income tax purposes) holds CASMED common stock, the tax treatment of a partner generally will depend on the status of the partners and the activities of the partnership. A partner of a partnership (including an entity treated as a partnership for U.S. federal income tax purposes) holding CASMED common stock should consult its independent tax advisor.

This summary is based on the Internal Revenue Code of 1986, as amended (referred to in this proxy statement as the Code), its legislative history, U.S. Treasury regulations promulgated thereunder, published rulings by the Internal Revenue Service, and judicial and administrative decisions in effect as of the date of this proxy statement, all of which are subject to differing interpretations and to change, possibly with retroactive effect. This summary applies only to beneficial owners who hold shares of CASMED common stock as “capital assets” within the meaning of Section 1221 of the Code and does not apply to shares of CASMED common stock received in connection with the cancellation or exercise of employee stock options or restricted stock awards or otherwise as compensation for services or through a tax-qualified retirement plan, stockholders who hold an equity interest, directly or indirectly, in Edwards after the merger, or to certain types of beneficial owners who may be subject to special rules (such as insurance companies, banks, tax-exempt organizations, financial institutions, broker dealers, dealers in currencies, partnerships, S corporations or other pass-through entities (or investors in an S corporation or other pass-through entity), mutual funds, real estate investment trusts, controlled foreign corporations, passive foreign investment companies, traders in securities who elect the mark-to-market method of accounting for their securities, U.S. expatriates, stockholders subject to the alternative minimum tax, stockholders that have a functional currency other than the U.S. dollar, or stockholders who hold CASMED common stock as part of a hedge, straddle, constructive sale, conversion transaction or other integrated transaction). This summary does not address any aspect of state, local, foreign or federal non-income tax laws.

U.S. Holders

Exchange of Shares of CASMED Common Stock for Cash Pursuant to the Merger Agreement.   The receipt of cash in exchange for shares of CASMED common stock pursuant to the merger will be a taxable transaction for U.S. federal income tax purposes. In general, a U.S. holder whose shares of CASMED common stock are converted into the right to receive cash in the merger will recognize capital gain or loss for U.S. federal income tax purposes equal to the difference, if any, between the amount of cash received in the merger with respect to such shares and the holder’s adjusted tax basis in such shares. Gain or loss will be determined separately for each block of shares (i.e., shares acquired at the same cost in a single transaction). Such gain or loss will be long-term capital gain or loss, provided that a U.S. holder’s holding period is more than one year at the time of the consummation of the merger. Certain limitations apply to the use of capital losses. Long-term capital gains for certain non-corporate U.S. holders, including

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individuals, are generally eligible for a reduced rate of federal income taxation. In addition, certain non-corporate U.S. holders, including individuals, may be subject to an additional 3.8% tax on all or a portion of their “net investment income,” which may include all or a portion of the gain recognized in connection with the merger.

Backup Withholding and Information Reporting.   The receipt of cash in exchange for shares of CASMED common stock by a U.S. holder pursuant to the merger may be subject to information reporting and backup withholding tax at the applicable rate, unless the U.S. holder (i) timely furnishes an accurate taxpayer identification number and otherwise complies with applicable U.S. information reporting or certification requirements (typically by completing and signing an Internal Revenue Service Form W-9, a copy of which will be included as part of the letter of transmittal to be timely returned to the paying agent); or (ii) is a corporation or other exempt recipient and, when required, establishes such fact in a manner satisfactory to the paying agent. U.S. holders who are exempt recipients not subject to backup withholding should indicate their exempt status on the Internal Revenue Service Form W-9 included as part of the letter of transmittal to be timely returned to the paying agent. Backup withholding is not an additional tax and any amounts withheld under the backup withholding rules may be refunded or credited against a U.S. holder’s U.S. federal income tax liability, if any, provided that the required information is furnished to the Internal Revenue Service in a timely manner.

Appraisal Rights.   The above discussion does not apply to holders of shares who properly perfect appraisal rights. Generally, a U.S. holder of CASMED common stock who properly demands and perfects appraisal rights under Delaware law with respect to such holder’s CASMED common stock will recognize capital gain or loss for U.S. federal income tax purposes equal to the difference, if any, between the amount of cash received in respect to such shares and the holder’s adjusted tax basis in such shares, except that a portion of the cash received may be taxable as interest.

Non-U.S. Holders

Exchange of Shares of CASMED Common Stock for Cash Pursuant to the Merger Agreement.   Any gain realized on the receipt of cash in the merger by a non-U.S. holder generally will not be subject to U.S. federal income tax unless:

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such gain is effectively connected with the conduct of a trade or business by the non-U.S. holder in the U.S. (and, if required by an applicable income tax treaty, is attributable to a permanent establishment or fixed base in the U.S.), in which case the non-U.S. holder generally will be subject to U.S. federal income tax on such gain in the same manner as a U.S. holder, provided such non-U.S. holder provides an Internal Revenue Service Form W-8ECI and, if the non-U.S. holder is a foreign corporation, such corporation may be subject to branch profits tax at the rate of 30% (or such lower rate as may be specified by an applicable income tax treaty);

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the non-U.S. holder is an individual who is present in the U.S. for 183 days or more in the taxable year of the disposition, and certain other conditions are met, in which case the non-U.S. holder generally will be subject to a 30% tax (or such reduced rate as may be provided in an applicable treaty) on the non-U.S. holder’s net gain realized in the merger, which may be offset by U.S. source capital losses of the non-U.S. holder, if any; or

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the non-U.S. holder owned (directly, indirectly or constructively) more than 5% of the outstanding CASMED common stock at any time during the five years preceding the merger, and we are or have been a “United States real property holding corporation” for U.S. federal income tax purposes at any time during such five-year period. Although there can be no assurances in this regard, we do not believe that we are or have been at any time during the five years preceding the merger a “United States real property holding corporation” for U.S. federal income tax purposes.

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Backup Withholding and Information Reporting.   A non-U.S. holder will be subject to information reporting and, in certain circumstances, backup withholding with respect to the cash received by such holder pursuant to the merger, unless such non-U.S. holder certifies under penalties of perjury that it is not a United States person (and the payor does not have actual knowledge or reason to know that the holder is a “United States person” as defined under the Code) or such holder otherwise establishes an exemption from backup withholding. Backup withholding is not an additional tax and any amounts withheld under

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the backup withholding rules may be refunded or credited against a non-U.S. holder’s U.S. federal income tax liability, if any. In order to avoid backup withholding, a non-U.S. holder should complete and sign an appropriate Form W-8 which may be obtained at www.irs.gov.

The U.S. federal income tax consequences described above are not intended to constitute tax advice nor a complete discussion of all tax consequences relating to the merger. Because individual circumstances may differ, each stockholder should consult its independent tax advisor regarding the applicability of the rules discussed above and the particular tax effects to the stockholder of the merger in light of such stockholder’s particular circumstances, the application of state, local, foreign and federal non-income tax laws, and, if applicable, the tax consequences of the receipt of cash in connection with the cancellation or exchange of options or restricted stock awards, including the transactions described in this proxy statement relating to our other equity compensation and benefit plans.

Interests of Certain Persons in the Merger

When considering the recommendation by our board of directors that our stockholders adopt the merger agreement, you should be aware that our directors and executive officers may have interests in the merger that are different from, or in addition to, the interests of our other stockholders. Our board of directors was aware of these interests and considered them, among other matters, in unanimously approving and declaring advisable the execution, delivery and performance of the merger agreement and the transactions contemplated by the merger agreement, including the merger, and determining that entering into the merger agreement and consummating the merger, are in the best interests of CASMED’s stockholders, and in making its recommendation that CASMED’s stockholders adopt the merger agreement. These interests are described below.

Beneficial Ownership and Treatment of CASMED Common Stock

As of  [•], 2019, the record date for the special meeting, our directors and executive officers beneficially owned, in the aggregate, [•] shares of CASMED common stock (including shares issuable upon conversion of shares of CASMED preferred stock and shares underlying options which are vested or vesting within 60 days).

Our directors and executive officers will receive the same $2.45 per share for their outstanding shares of CASMED common stock as our other stockholders. For further information with respect to the ownership of CASMED common stock of our directors and executive officers, see “Security Ownership of Certain Beneficial Owners, Directors and Executive Officers.”

Treatment of Outstanding Equity Awards and Employee Stock Purchase Plan

Stock Options

As of the effective time of the merger, all options to acquire shares of CASMED common stock that are outstanding and unexercised (whether vested or unvested) will be cancelled and converted into a right to receive (i) as to those options with an exercise price that is equal to or less than $2.45 per share, the product of  (x) the excess of  $2.45 over the exercise price per share of the applicable option, and (y) the number of shares subject to the applicable option, less any applicable withholding taxes and (ii) as to those options with an exercise price that exceeds $2.45 per share, the product of  $0.10 and the number of shares subject to the applicable option. Our directors and executive officers have agreed to cancel any options with an exercise price that exceeds $2.45 per share, without payment of additional consideration.

Restricted Stock Awards

As of the effective time of the merger, each award of CASMED common stock that is subject to vesting conditions (each referred to in this proxy statement as a restricted stock award) will be vested, and each holder of a restricted stock award will have the right to receive an amount in cash equal to (x) the number of shares of CASMED common stock subject to such restricted stock award, multiplied by (y) $2.45, less any applicable withholding taxes.

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Notwithstanding the foregoing, 150,000 shares of restricted stock subject to performance-based vesting conditions underlying an Inducement Restricted Stock Agreement made as of August 27, 2010 by and between CASMED and Thomas M. Patton, will be cancelled, with no further consideration due to Mr. Patton.

Employee Stock Purchase Plan

As soon as practicable following the date of the merger agreement, CASMED’s board of directors (or, if applicable, any committee thereof administering CASMED’s employee stock purchase plan) shall adopt such resolutions or take such other necessary actions such that: (i) the employee stock purchase plan shall be terminated, contingent upon the closing; (ii) no offering periods under the employee stock purchase plan shall commence after the effective time of the merger (and accordingly there shall be no payroll contributions to the employee stock purchase plan from participants after the effective time of the merger); and (iii) CASMED shall take all necessary actions so that no participants in the employee stock purchase plan have outstanding purchase rights under the employee stock purchase plan as of the effective time of the merger. Additionally, the CASMED board or directors (or, if applicable, any committee thereof administering the administering CASMED’s employee stock purchase plan), shall discontinue the current offering period under the employee stock purchase plan and provide that participants in such offering period shall have their accumulated payroll deductions for such offering period used to purchase CASMED common stock as of the last day of the month following the date of the merger agreement and such participants’ purchase rights under the employee stock purchase plan shall otherwise terminate following the date of such purchase. The executive officers and directors listed in the summary table below do not participate in the ESPP.

Summary Table

The following table shows, for each executive officer and each director, as applicable, (i) the number of shares of CASMED common stock subject to vested and unvested options held by him or her; (ii) the cash consideration that he or she will receive for such options upon completion of the merger; (iii) the number of shares of CASMED common stock subject to unvested restricted stock awards held by him or her; (iv) the cash consideration that he or she will receive for such restricted stock awards upon completion of the merger; (v) the total cash consideration he or she will receive for all outstanding equity awards upon completion of the merger, in each case as of an assumed merger closing date of April 30, 2019, based on applicable holdings on the date hereof and assuming continued employment or service through the assumed merger closing date (and as such without regard to any grants that may be made after the date hereof).

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(1)

Includes the aggregate number of shares that are subject to vested and unvested options to purchase shares of CASMED common stock.

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(2)

Represents the aggregate cash-out value of vested and unvested options to purchase shares of CASMED common stock. The value of each stock option to purchase shares of CASMED common stock is calculated as (a) the merger consideration of  $2.45 minus the exercise price of the stock option multiplied by (b) the number of shares subject to the option. All directors and executive officers have agreed to cancel any options with an exercise price that exceeds $2.45 per share, without payment of additional consideration.

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(3)

Represents shares subject to unvested restricted stock awards. The value of such restricted stock awards is calculated as the merger consideration of  $2.45 multiplied by the number of shares subject to the award. Mr. Patton’s total does not include 150,000 shares of restricted stock subject to performance-based vesting conditions underlying the CAS Medical Systems, Inc. Inducement Restricted Stock Agreement made as of August 27, 2010 by and between CASMED and Mr. Patton which will be cancelled immediately prior to the merger, with no consideration paid to Mr. Patton.

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Employment Agreements

CASMED is a party to employment agreements with Thomas Patton, President and Chief Executive Officer, Jeffery A. Baird, Chief Financial Officer and Secretary, John K. Gamelin, Vice President — Research and Development, and Paul B. Benni, Chief Scientific Officer (the employment agreements collectively, as amended, referred to in this proxy statement as the employment agreements).

Pursuant to the employment agreements with Messrs. Patton, Baird and Gamelin, if CASMED (or a successor company) terminates such executive’s employment without Serious Cause (generally defined in the employment agreement as (i) willful and continued failure to perform his duties, (ii) indictment or guilty plea with respect to a felony, (iii) habitual abuse of a controlled substance, (iv) fraud, material dishonesty or gross misconduct, or (v) a material breach of the employment agreement by the executive) or the executive terminates his employment for Good Reason (generally defined in the employment agreement as (i) a material reduction in the executive’s base salary or benefits, (ii) a material reduction in executive’s duties or responsibilities, or (iii) a material breach of the employment agreement by CASMED), within the period commencing on the date that a change of control is formally proposed to our board of directors and ending on the second anniversary of  (or in the case of Mr. Gamelin, six months after) the date on which such change of control occurs, then the executive will be entitled to receive his then-current base salary for a period of one year from the date of such termination (six months of base salary paid out over a one-year period in the case of Mr. Gamelin) and in addition will be entitled to participate in our health benefit plans (with standard employee payment not to exceed the payment level prior to the change in control) for the period of one year. In addition, such executive’s equity-linked grants (such as stock options and restricted stock) shall immediately accelerate and vest in full.

However, as noted above, Mr. Patton has agreed with CASMED that effective upon the merger, 150,000 shares of restricted stock subject to performance-based vesting conditions underlying an Inducement Restricted Stock Agreement made as of August 27, 2010 by and between CASMED and Thomas M. Patton, will be cancelled, with no further consideration due to Mr. Patton.

Pursuant to the employment agreement with Mr. Benni, if CASMED terminates such executive’s employment without Serious Cause (generally defined in the employment agreement as (i) willful and continued failure to perform his duties, (ii) indictment or guilty plea with respect to a felony, (iii) habitual abuse of a controlled substance, (iv) fraud, material dishonesty or gross misconduct, or (v) a material breach of the employment agreement by the executive) or the executive terminates his employment for Good Reason (generally defined in the employment agreement as (i) a material reduction in the executive’s base salary or benefits, (ii) a material reduction in executive’s duties or responsibilities, or (iii) a material breach of the employment agreement by CASMED), then Mr. Benni will be entitled to receive his then-current base salary for a period of six months from the date of such termination and in addition will be entitled to participate in our health benefit plans (with standard employee payment not to exceed the payment level prior to the termination) for the period of six months.

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As a condition of an executive’s receipt of the severance payments and benefits under the employment agreements, the executive will be subject to certain non-competition and non-solicitation restrictions for one (1) year (six (6) months in the case of Mr. Benni). If the executive were to violate such restrictions during the severance period, then such executive would forfeit any remaining severance payments.

See “Proposal 3: Advisory Vote Regarding Golden Parachute Compensation” for quantification of the severance payments and benefits to which our named executive officers, Messrs. Patton, Baird and Gamelin, would be entitled under their employment agreements upon a qualifying termination of employment.

Supplemental Transaction Bonus

Certain of our executive officers, including Messrs. Patton, Baird, Gamelin and Benni, are eligible to receive supplemental transaction bonuses, pursuant to which each executive will be eligible for a lump sum cash transaction bonus payment upon closing of the proposed merger. In order to be eligible for the transaction bonus, each executive generally must remain employed through the proposed merger. The amounts to which each executive officer will be eligible under these agreements are as follows: Mr. Patton ($325,000); Mr. Baird ($240,000); Mr. Gamelin ($220,000); and Mr. Benni ($75,000).

Indemnification and Insurance

Pursuant to the merger agreement, Edwards and Merger Sub have agreed that all rights to indemnification and exculpation from liabilities, including advancement of expenses, for acts or omissions occurring at or prior to the effective time of the merger agreement now existing in favor of each person who is now, or has been at any time prior to the date hereof or who becomes prior to the effective time of the merger agreement a director or officer of CASMED or any of its subsidiaries that are provided in the certificate of incorporation, the bylaws or any indemnification contract between such directors or officers and CASMED (in each case, as in effect on, and in the case of any indemnification contracts, to the extent made available to Edwards prior to, the date of the merger agreement) shall survive the merger and shall continue in full force and effect. For a period of six (6) years from the effective time of the merger, the surviving corporation shall, and Edwards shall cause the surviving corporation to, maintain in effect the exculpation, indemnification and advancement of expenses at least equivalent to the provisions of the certificate of incorporation and bylaws as in effect immediately prior to the effective time of the merger solely with respect to acts or omissions occurring prior to the effective time of the merger and shall not amend, repeal or otherwise modify any such provisions in any manner that would adversely affect the rights thereunder of any of the applicable individuals; provided, however, that all rights to indemnification in respect of any action pending or asserted or any claim made for indemnification within such period shall continue until the disposition of such action or resolution of such claim. From and after the effective time of the merger, Edwards shall guarantee as surety for, and shall cause the surviving corporation to honor, in accordance with their respective terms, each of these covenants.

Prior to the effective time of the merger, CASMED shall or, if CASMED is unable to, Edwards shall cause the surviving corporation as of or after the effective time of the merger to, purchase a six (6)-year prepaid “D&O tail” insurance policy, with terms, conditions, retentions and limits of liability that are no less favorable than the coverage provided under CASMED’s existing policies of directors’ and officers’ liability insurance and fiduciary liability insurance, in each case with respect to matters arising on or before the effective time of the merger (including in connection with the merger agreement and the transactions or actions contemplated by the merger agreement), and Edwards shall cause such policy to be maintained in full force and effect, for its full term, and cause all obligations thereunder to be honored by the surviving corporation, and no other party shall have any further obligation to purchase or pay for insurance hereunder; provided, however, that CASMED shall not pay, and the surviving corporation shall not be required to pay, in excess of 300% of the last annual premium paid by CASMED prior to the date of the merger agreement in respect of such “tail” policy. If CASMED or the surviving corporation for any reason fail to obtain such “tail” insurance policies prior to, as of or after the effective time of the merger, Edwards shall, for a period of six (6) years from the effective time of the merger, cause the surviving corporation to maintain in effect the current policies of directors’ and officers’ liability insurance and fiduciary liability insurance maintained by CASMED with respect to matters arising on or before the effective time of the

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merger. After the effective time of the merger, Edwards shall not be required to pay annual premiums in excess of 300% of the last annual premium paid by CASMED prior to the date of the merger agreement in respect of the coverage required to be obtained pursuant to the terms of the merger agreement, but in such case shall purchase as much coverage as reasonably practicable for such amount.

The covenants contained related to the directors’ and officers’ indemnification and insurance survive the consummation of the merger and are intended to be for the benefit of, and shall be enforceable by, each of the indemnified parties and their respective heirs and shall not be deemed exclusive of any other rights to which any such person is entitled, whether pursuant to law, contract or otherwise. Such covenants shall not be terminated or modified after consummation of the merger in such a manner to adversely affect any indemnified party without the consent of such indemnified party.

In the event that Edwards or the surviving corporation or any of their respective successors or assigns consolidates with or merges into any other Person and shall not be the continuing or surviving corporation or entity of such consolidation or merger or transfers or conveys all or substantially all of its properties and assets to any person, then, and in each such case, Edwards and the surviving corporation shall cause proper provision to be made so that the successors or assigns of Edwards or the surviving corporation, as the case may be, shall assume the obligations set forth with respect to the directors’ and officers’ indemnification and insurance.

Governmental and Regulatory Approvals and Other Third Party Consents

Under the HSR Act, and the rules promulgated thereunder by the FTC, the merger may not be completed until notification and report forms have been filed with the FTC and the DOJ, and the applicable waiting period has expired or been terminated. CASMED, Edwards and Edwards Lifesciences Corporation filed the notification and report forms under the HSR Act with the FTC and the DOJ on [•], 2019, which triggered an initial 30-day waiting period. The DOJ, the FTC, state Attorneys General or private parties may also challenge the merger on antitrust grounds either before or after the transaction has closed. Accordingly, while the parties believe that the transaction complies with the applicable antitrust laws, it is possible that at any time before or after expiration or termination of the HSR Act waiting period or even after the completion of the merger, any of the DOJ, the FTC, state Attorneys General or private parties could take action under the antitrust laws as deemed necessary or desirable in the public or other interest, including without limitation seeking to enjoin the completion of the merger or permitting completion subject to regulatory concessions or conditions.

At any time before or after consummation of the merger, notwithstanding expiration or early termination of the waiting period under the HSR Act, the DOJ or the FTC could take such action under the antitrust laws as it deems necessary or desirable, including seeking to enjoin the consummation of the merger or seeking divestiture of substantial assets of CASMED or Edwards. At any time before or after the consummation of the merger, and notwithstanding the expiration or early termination of the waiting period under the HSR Act, any state could take such action under the antitrust laws as it deems necessary or desirable. Such action could include seeking to enjoin the consummation of the merger or seeking divestiture of substantial assets of CASMED or Edwards. Nothing in the merger agreement will require Edwards, Merger Sub or any of their affiliates to (w) propose, negotiate, commit to and effect, by consent decree, hold separate order, or otherwise, the sale, divestiture or disposition of any businesses, assets, equity interests, product lines or properties of CASMED or of Edwards or any of their respective affiliates, (x) create, terminate, or divest relationships, ventures, contractual rights or obligations of CASMED or of Edwards or any of their respective affiliates, (y) otherwise take or commit to take any action that would limit Edwards’s or its affiliates’ freedom of action with respect to, or its ability to retain or hold, directly or indirectly, any businesses, assets, equity interests, product lines or properties of CASMED or of Edwards or any of their respective affiliates, or (z) require CASMED or Edwards or any of their respective affiliates to take or agree to take (or cause any of its subsidiaries to take or agree to take) any other action or to agree (or cause any of its subsidiaries to agree) to any limitation or restriction on any of its or their respective businesses, product lines or assets, in each case as may be required in order to obtain all expirations or terminations of waiting periods required under any antitrust law or to avoid the commencement of any action by a governmental authority to prohibit the transactions contemplated by the merger agreement

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under any antitrust law, or, in the alternative, to avoid the entry of, or to effect the dissolution of, any injunction, temporary restraining order or other order in any action or proceeding seeking to prohibit the transactions contemplated by the merger agreement or delay the effective time beyond November 8, 2019.

The term “antitrust laws” means the Sherman Act, as amended, the Clayton Act, as amended, the HSR Act, the Federal Trade Commission Act, as amended, all applicable foreign antitrust laws and all other applicable laws issued by any government, court, regulatory or administrative agency, commission or authority or other governmental instrumentality, whether federal, state or local, domestic, foreign or multinational, designed or intended to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade or lessening of competition through merger or acquisition.

We cannot assure you that an antitrust or other regulatory challenge to the merger will not be made.

In connection with obtaining any other consents or approvals of third parties required under the merger agreement, neither Edwards or any of its affiliates will be required to, and without the prior written consent of Edwards, none of CASMED or any of its subsidiaries or affiliates is permitted to, grant or offer to grant any accommodation or concession (financial or otherwise), or make any payment, to any third party in connection with seeking or obtaining its consent to the transactions contemplated by the merger agreement.

Delisting and Deregistration of CASMED Common Stock

If the merger is completed, CASMED common stock will no longer be traded on the NASDAQ Capital Market and will be deregistered under the Exchange Act, and we will no longer be required to file periodic reports with the SEC in respect of CASMED common stock in accordance with applicable law, rules, and regulations.

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THE MERGER AGREEMENT

The following describes certain material provisions of the merger agreement, which is attached as Annex A to this proxy statement and which is incorporated by reference herein. The description in this section and elsewhere in this proxy statement is qualified in its entirety by reference to the merger agreement. This summary does not purport to be complete and may not contain all of the information about the merger agreement that is important to you. CASMED encourages you to read carefully the merger agreement in its entirety before making any decisions regarding the merger because it is the principal document governing the merger.

The merger agreement and this summary of its terms have been included to provide you with information regarding the terms of the merger agreement. Factual disclosures about CASMED contained in this proxy statement or in CASMED’s public reports filed with the SEC may supplement, update or modify the factual disclosures about CASMED contained in the merger agreement and described in this summary. The representations, warranties and covenants made in the merger agreement by CASMED were qualified and subject to important limitations agreed to by CASMED in connection with negotiating the terms of the merger agreement and may be subject to a contractual standard of materiality which may differ from what may be viewed as material by investors. In particular, in your review of the representations and warranties contained in the merger agreement and described in this summary, it is important to bear in mind that the representations and warranties were negotiated with the principal purposes of establishing the circumstances in which a party to the merger agreement may have the right not to close the merger if the representations and warranties of the other party prove to be untrue due to a change in circumstance or otherwise, and allocating risk between the parties to the merger agreement, rather than establishing matters as facts. Information concerning the subject matter of the representations and warranties, which do not purport to be accurate as of the date of this proxy statement, may have changed since the date of the merger agreement.

The Merger

Subject to the terms and conditions of the merger agreement and in accordance with the DGCL, at the effective time of the merger, Merger Sub, a wholly owned subsidiary of Edwards and a party to the merger agreement, will merge with and into CASMED. CASMED will survive the merger as a direct wholly owned subsidiary of Edwards (following the merger, CASMED is referred to in this proxy statement as the surviving company) and the separate corporate existence of Merger Sub will cease.

Effective Time; Closing

The effective time of the merger will occur at the time the parties file a certificate of merger with the Secretary of State of the State of Delaware on the closing date of the merger or such later time as agreed to by Edwards and CASMED and specified in the certificate of merger.

Unless CASMED and Edwards agree otherwise, the closing of the merger will occur at 10:00 am on a date specified by Edwards and CASMED, but no later than the third business day following the satisfaction or (to the extent permitted by law) waiver of the conditions to the merger set forth in the merger agreement.

Merger Consideration

CASMED Common Stock

The merger agreement provides that each share of CASMED common stock outstanding immediately prior to the effective time of the merger (other than shares of CASMED common stock owned by CASMED as treasury stock or owned directly by Edwards or any of its subsidiaries (including Merger Sub) or shares of CASMED common stock the holders of which have properly perfected their appraisal rights under Delaware law) will be cancelled and converted into the right to receive $2.45 in cash, without interest or dividends thereon, less any applicable withholding taxes.

The merger agreement provides that each share of CASMED common stock held by CASMED as treasury stock and each share of CASMED common stock owned by Edwards or any of its subsidiaries (including Merger Sub) will be cancelled and no consideration will be delivered in exchange therefor. Shares

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of CASMED common stock held by a stockholder who has not voted in favor of the merger and is entitled to demand and has properly demanded his appraisal rights will not be converted into the right to receive the merger consideration. Such stockholder will instead be entitled to the appraisal rights provided under the DGCL as described under “Appraisal Rights.”

Each issued and outstanding share of capital stock of Merger Sub will be converted into and become one validly issued, fully paid and nonassessable share of common stock, par value $0.01, of the surviving company and constitute the only outstanding shares of capital stock of the surviving corporation.

CASMED Preferred Stock

The merger agreement provides that each share of CASMED preferred stock outstanding immediately prior to the effective time of the merger (other than shares of CASMED preferred stock owned by CASMED as treasury stock or owned directly by Edwards or any of its subsidiaries (including Merger Sub) or shares of CASMED preferred stock the holders of which have properly perfected their appraisal rights under Delaware law) will be converted into CASMED common stock pursuant to CASMED’s certificate of incorporation and holders of such stock will be compensated as holders of CASMED common stock.

Treatment of CASMED Stock Options, Restricted Stock Awards, ESPP, CASMED Stock Plans and CASMED Warrants

CASMED Stock Options

As of the effective time of the merger, all options to acquire shares of CASMED common stock shall be cancelled and converted into a right for the holder of such option to receive, subject to and effective as of the effective time of the merger, the option consideration (as described below) and no such option will remain outstanding. Prior to the effective time of the merger, CASMED shall take all actions necessary to effectuate the preceding sentence, which actions are subject to review and approval by Edwards, such approval not to be unreasonably withheld or delayed. Neither Edwards nor Merger Sub will assume any option or substitute for any option any similar award for Edwards common stock in connection with the merger and any of the other transactions contemplated by the merger agreement.

Option consideration means (i) as to those options with an exercise price that is equal to or less than the merger consideration, the product of the excess, if any, of the merger consideration over the exercise price per share of the applicable option, and the number of shares subject to the applicable option, and (ii) as to those options with an exercise price that exceeds the merger consideration, the product of  $0.10 and the number of shares subject to the applicable option, less any applicable withholding taxes.

In order to have all stock options available for cancellation, as is required under the merger agreement, we plan to commence a tender offer, as soon as practicable, to purchase all outstanding options (that do not expire by their terms at or prior to the completion of the merger) for the option consideration set forth above.

CASMED Restricted Stock Awards

Neither Edwards nor Merger Sub will assume any CASMED restricted stock awards or substitute for any CASMED restricted stock awards and similar award of Edwards common stock in connection with the merger and the other transactions contemplated by the merger agreement. As of immediately prior to the effective time of the merger agreement, all restrictions applicable to any CASMED restricted stock award will lapse and the stock underlying each such award shall be treated as set in the provision of the merger agreement regarding the conversion of CASMED common stock. Notwithstanding the foregoing, CASMED shall take all actions necessary to ensure that, as of immediately prior to the effective time of the merger agreement, all 150,000 shares of restricted stock subject to performance-based vesting conditions underlying the CAS Medical Systems, Inc. Inducement Restricted Stock Agreement made as of August 27, 2010 by and between CAS Medical Systems, Inc. and Thomas M. Patton, are cancelled, with no further consideration due to Mr. Patton.

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Employee Stock Purchase Plan

As soon as practicable following the date of the merger agreement, CASMED’s board of directors (or, if applicable, any committee thereof administering CASMED’s employee stock purchase plan) shall adopt such resolutions or take such other necessary actions such that:

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the employee stock purchase plan will be terminated, contingent upon the closing;

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no offering periods under the employee stock purchase plan will commence after the effective time of the merger (and accordingly there will be no payroll contributions to the employee stock purchase plan from participants after the effective time of the merger); and

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CASMED shall take all necessary actions so that no participants in the employee stock purchase plan have outstanding purchase rights under the employee stock purchase plan as of the effective time of the merger.

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Pursuant to CASMED’s employee stock purchase plan, CASMED’s board of directors will discontinue the current offering period and any participants in the offering period shall have their accumulated payroll deductions used to purchase CASMED common stock as of the last day of the month following the date of the merger agreement and thereafter their rights pursuant to the employee stock purchase plan shall terminate.

CASMED Equity Plans

Prior to the effective time of the merger, CASMED shall provide such notice, if any, to the extent required under the terms of any of CASMED’s equity plans or stand-alone equity grants (together, the equity plans), adopt applicable resolutions, amend the terms of any of CASMED’s equity plans or any outstanding awards thereunder, obtain any necessary consents, and take all other appropriate actions to:

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give effect to the transactions contemplated in this clause;

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terminate each of CASMED’s equity plans as of the effective time of the merger; and

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ensure that after the effective time of the merger, no holder of a CASMED equity award, any beneficiary thereof nor any other participant in any of CASMED’s equity plans shall have any right thereunder to acquire any securities of CASMED or to receive any payment or benefit with respect to any award previously granted under any of the CASMED’s equity plans other than any applicable merger consideration. CASMED shall provide Edwards with documentation evidencing the completion of the foregoing actions (the form and substance of such documentation shall be subject to review and approval by Edwards, such approval not to be unreasonably withheld or delayed) no later than the second (2nd) business day preceding the effective time of the merger.

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CASMED Warrants

Neither Edwards nor Merger Sub shall assume any warrants to purchase CASMED common stock or substitute for any such warrant any similar award for the common stock of Edwards or any of its affiliates in connection with the merger and the other transactions contemplated by the merger agreement. As of the effective time of the merger agreement, each unexercised warrant to purchase CASMED common stock that was outstanding immediately prior to the effective time of the merger shall, in accordance with the terms of the applicable warrant, no longer be exercisable and shall have either been exercised by the holder thereof in accordance with the terms of such warrant immediately prior to the effective time of the merger or if not so exercised, expired immediately prior to the effective time of the merger.

Promptly following the execution and delivery of the merger agreement, CASMED shall provide written notice in accordance with the terms of each warrant to the holder thereof that the merger shall constitute a “Cash/Public Acquisition” or an “Acquisition in which the sole consideration is cash” (in each case if and as defined in the applicable warrant), and of the treatment of such warrant pursuant to the above, and CASMED shall take all actions required to ensure compliance with the obligations of CASMED under each of the warrants in accordance with the terms thereof to consummate the treatment

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of the warrants pursuant to the above. Prior to taking any such actions, including the delivery of the foregoing notices, CASMED shall consult with Edwards and provide Edwards and its counsel with a reasonable opportunity to review and comment on any related notices, filings or other documents.

Withholding

CASMED, Edwards, the surviving company, the paying agent or other applicable withholding agent will be entitled, without duplication, to deduct and withhold from the consideration otherwise payable pursuant to the merger agreement such amounts as are required to be deducted and withheld with respect to the making of any such payment CASMED, Edwards, the surviving company, any of their applicable subsidiaries or the paying agent are required to deduct and withhold with respect to the making of such payment under any tax law. Any amounts so withheld shall be treated as having been paid to the person in respect of which such deduction and withholding was made.

Unexchanged Shares

No cash payment with respect to the merger consideration will be paid to the holder of any unsurrendered certificate (or shares of CASMED common stock held in book entry form) until the surrender of such certificate (or shares of CASMED common stock held in book entry form).

Representations and Warranties

The merger agreement contains representations and warranties of each of CASMED, Edwards and Merger Sub, subject to certain qualifications or exceptions in the merger agreement and the disclosure schedules delivered in connection with the merger agreement, as to, among other things:

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corporate organization, existence, good standing and corporate power and authority to conduct its business as presently conducted and own, lease and operate its properties and assets as currently operated;

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corporate power and authority to enter into the merger agreement, to perform its obligations thereunder and to complete the transactions contemplated thereby;

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the absence of certain violations, defaults or consent requirements under certain contracts, organizational documents and law, in each case arising out of the execution, delivery or performance of, consummation of the transactions contemplated by, or compliance with any of the provisions of the merger agreement;

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required regulatory filings or actions and authorizations, consents or approvals of governmental entities and other persons;

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the absence of certain litigation, orders and judgments and governmental proceedings and investigations related to Edwards and its subsidiaries or CASMED and its subsidiaries (as applicable);

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matters relating to information to be included in required filings with the SEC in connection with the merger; and

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the absence of any fees owed to investment bankers or brokers in connection with the merger, other than those specified in the merger agreement.

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The merger agreement also contains representations and warranties of CASMED, subject to certain qualifications or exceptions in the merger agreement and the disclosure schedules delivered in connection with the merger agreement, as to, among other things:

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the capitalization of CASMED, including the authorized capital stock, outstanding options, shares of CASMED common stock reserved for issuance under the ESPP, shares of CASMED common stock reserved for issuance under CASMED’s equity plans and outstanding warrants to purchase shares of CASMED common stock;

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all shares of CASMED common stock (i) having been, or being when issued pursuant to any CASMED equity award, CASMED equity plan, the ESPP or any warrants in accordance with the respective terms thereof, duly authorized, validly issued, fully paid, non-assessable and free of pre-emptive rights and (ii) having been issued pursuant to an effective registration statement or exemption therefrom;

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the proper authorization of CASMED equity awards and outstanding warrants and issuance of the same in compliance with applicable laws;

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the absence of, other than the CASMED preferred stock, the CASMED equity awards, the warrants or pursuant to the ESPP, among other things, (i) outstanding options, warrants, calls, pre-emptive rights, subscriptions or other securities or rights, stock appreciation rights, restricted stock award, restricted stock unit awards, convertible securities, agreements, arrangements or commitments of any kind obligating CASMED or any of its subsidiaries to issue, transfer or sell (or cause to be issued, transferred or sold) any shares of capital stock or other securities of CASMED or any of its subsidiaries or securities convertible into or exchangeable for such shares or other securities; (ii) outstanding obligations of CASMED or any of its subsidiaries to repurchase, redeem or otherwise acquire any securities of CASMED or any of its subsidiaries, or any securities representing the right to purchase or otherwise receive any other securities of CASMED or any of its subsidiaries; (iii) agreements to which CASMED or any of its subsidiaries is a party restricting the transfer of securities of CASMED or any of its subsidiaries or affecting the voting rights of securities of CASMED or any of its subsidiaries; or (iv) outstanding or authorized equity or equity-based compensation awards;

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the absence of any (i) direct or indirect ownership of any securities, including equity interests, of any person (except for securities of CASMED subsidiaries) or (ii) obligations or commitments to acquire any such securities or to provide funds to or make any investment in any person;

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the full payment of all dividends or distributions on securities of CASMED or any of its subsidiaries that have been declared or authorized;

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the absence of any agreements or commitments obligating CASMED or any of its subsidiaries to register or cause to be further registered (other than pursuant to currently effective resale shelf registration statements or “piggy-back” rights) any shares of capital stock or other securities of CASMED or any of its subsidiaries or securities convertible into or exchangeable for such shares or other securities;

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the corporate actions required to be taken, and taken in connection with the execution, delivery and performance of the merger agreement by CASMED, including with respect to the approval of CASMED stockholders of the proposed merger;

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the timeliness and accuracy of CASMED’s filings with the SEC and of financial statements included in its SEC filings, and the compliance of filings and financial statements with SEC rules and (in the case of financial statements) with United States generally accepted accounting principles, the Sarbanes-Oxley Act of 2002, the applicable rules and regulations of the Nasdaq Stock Market;

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CASMED’s disclosure controls and procedures and internal control over financial reporting;

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the absence of any SEC proceedings regarding any irregularities regarding accounting practices of, any malfeasance by any director or executive officer of, CASMED or any of its subsidiaries or any allegations or claims regarding accounting, internal accounting controls, auditing practices, procedures, methodologies or methods of CASMED or any of its subsidiaries or unlawful accounting or auditing matters with respect to CASMED or any of its subsidiaries;

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the absence of certain changes from December 31, 2017 through the date of the merger agreement, including the conduct of the businesses of CASMED and its subsidiaries in the ordinary course consistent with past practice, and the absence of a Company Material Adverse Effect;

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the absence of certain undisclosed liabilities of CASMED;

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the possession by CASMED, its subsidiaries and, to the knowledge of CASMED, its distributors of all licenses, permits and other authorizations necessary to own, lease and operate their respective properties and assets as currently conducted and in compliance with applicable law;

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the compliance by CASMED and its subsidiaries with applicable law and licenses, permits and other authorizations;

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CASMED’s employee benefit plans and other agreements with its employees;

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labor matters related to CASMED and its subsidiaries and their respective employees, including the absence of settlement agreements involving allegations of sexual harassment;

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the payment of taxes, the filing of tax returns, lack of tax audits or proceedings and other tax matters related to CASMED and its subsidiaries;

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certain categories of specified material contracts, including as to effectiveness and lack of breach or default for such contracts, and the absence of related-party transactions of CASMED and its subsidiaries;

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the absence of material disputes or claims under or relating to certain distribution, reseller, sales representative, commercial agency and similar or other distribution agreements; no material deviations from the terms of such agreements through course of dealing that have the potential to change the rights or duties of the parties thereto; and the ability of Edwards or CASMED to terminate or let expire all such agreements without incurring any responsibility to pay compensation or indemnities or become exposed to any termination liability that is not expressly contemplated in such agreements or required by law;

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(i) the ownership of or rights with respect to CASMED’s and its subsidiaries’ intellectual property, (ii) the ownership of or rights to intellectual property necessary to the operation of CASMED’s and its subsidiaries’ respective businesses, as conducted or as planned to be conducted as of the closing, (iii) the maintenance and preservation of CASMED’s intellectual property; (iv) the absence of liens other than certain permitted liens or restrictions with respect to CASMED’s or its subsidiaries’ intellectual property; (v) the scope of CASMED’s and its subsidiaries’ intellectual property; (vi) the non-infringement or misappropriation by CASMED or any of its subsidiaries of the intellectual property of third parties; (vii) the steps taken to protect CASMED’s and its subsidiaries’ trade secrets and other proprietary information; (viii) the absence of any final court decision holding any CASMED or CASMED subsidiary registered intellectual property invalid; (ix) the absence of any settlements, consents, orders or similar obligations to which CASMED or any of its subsidiaries is a party restricting their rights to use, enjoy or exploit their material intellectual property; and (x) the steps taken to protect the software used by CASMED or any of its subsidiaries;

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real property owned or leased by CASMED or any of its subsidiaries;

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environmental matters and compliance with environmental laws by CASMED and its subsidiaries;

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customers, distributors and suppliers of CASMED and its subsidiaries;

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product warranties and other terms related to each product manufactured, sold, leased delivered or distributed or service provided or rendered by CASMED or any of its subsidiaries;

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compliance with anti-bribery and anti-corruption laws, rules and regulations, including the Foreign Corrupt Practices Act, the U.S. Travel Act, the U.K. Bribery Act 2010 and the applicable laws implementing the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions;

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compliance with customs and international trade laws;

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compliance with all necessary authorizations, approvals, clearances, consents or registrations and with all laws and regulations required by any regulatory or other governmental authority,

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including the regulations of the United States Food and Drug Administration or any comparable regulatory authority, required for, among other things, the research, investigation, development, manufacture, use and sale of the products of CASMED and any of its subsidiaries;

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compliance with certain federal health care program laws, federal privacy and security regulations and the federal anti-kickback statute;

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insurance policies of CASMED or any of its subsidiaries;

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non-applicability of certain anti-takeover laws to the merger agreement or the merger; and

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the receipt by the board of directors of an opinion of William Blair as to the fairness of the merger consideration, from a financial point of view, to the holders of shares of CASMED common stock.

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The merger agreement also contains representations and warranties of Edwards and Merger Sub, subject to certain qualifications or exceptions in the merger agreement and the disclosure schedules delivered in connection with the merger agreement, as to, among other things:

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the availability to Edwards, as of the Closing Date, of sufficient funds to consummate the merger and the other transactions contemplated by the merger agreement that require payment in connection with the closing, and the absence of any condition regarding Edwards’ or Merger Sub’s ability to obtain financing for the merger and the other transactions contemplated by the merger agreement;

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Edwards’ ownership of all of the issued and outstanding capital stock of Merger Sub; and

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the absence during the last three years of any ownership by Edwards or Merger Sub, or any of their respective controlled affiliates of CASMED common stock or securities convertible into or exchangeable for CASMED common stock.

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Some of the representations and warranties in the merger agreement are qualified by materiality qualifications or a “Company Material Adverse Effect” or “Parent Material Adverse Effect” clause.

For purposes of the merger agreement, a “Company Material Adverse Effect” means any effect, change, development, event, circumstance, occurrence, condition, fact or state of facts that has, or would be reasonably expected to have, a material adverse effect, individually or in the aggregate:

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on the business, condition (financial or otherwise), assets, liabilities or results of operations of CASMED and its subsidiaries, taken as a whole (it being understood that ongoing net losses comparable to recent prior periods shall not constitute a Company Material Adverse Effect); provided, however, that any effect, change, development, event, occurrence, condition or state of facts directly resulting from or arising out of the following will not be taken into account in determining whether a Company Material Adverse Effect has occurred:

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changes in general United States or global economic, regulatory or financial market conditions;

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changes in the economic, business and financial environment generally affecting the medical device industry;

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an act of terrorism or an outbreak or escalation of hostilities or war (whether or not declared) or any natural disasters, national emergencies or other similar force majeure events, including any escalation or worsening of such conditions threatened or existing as of the date of the merger agreement;

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any adoption, implementation, promulgation, repeal, modification, amendment or other changes in United States generally accepted accounting principles; or

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the public announcement or pendency of the Merger or the other transactions contemplated thereby;

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changes in the price or trading volume of CASMED’s common stock;

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any failure to meet any internal or public projections, forecasts, guidance, estimates, milestones, budgets or internal or published financial or operating predictions of revenue, earnings, cash flow or cash position (it being understood that the exceptions in the 6th and 7th sub-bullets shall not prevent or otherwise affect a determination that the underlying cause of any such change or failure referred to therein (to the extent not otherwise falling within any of the exceptions provided by the 1st through 5th or 8th sub-bullet hereof) is, may be, contributed to or may contribute to, a Company Material Adverse Effect);

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any action expressly required to be taken pursuant to the merger agreement (it being understood and agreed that actions taken by CASMED or its subsidiaries pursuant to its obligations under the covenant regarding conduct its business pending the closing of the merger shall not be excluded in determining whether a Company Material Adverse Effect has occurred); or

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any action taken at the express written direction of Edwards given after the date of the merger agreement;

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provided, further, however, that in the cases of the 1st, 2nd, 3rd and 4th sub-bullets above, to the extent CASMED and its subsidiaries, taken as a whole, are, or would be reasonably expected to be, disproportionately affected thereby in relation to other companies in the medical device industry, such effects, changes, developments, events, circumstances, occurrences, conditions, facts or states of facts may be taken into account in determining whether a Company Material Adverse Effect has occurred to the extent of such disproportionate impact; or

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on the ability of CASMED to perform its obligations under the Merger Agreement or to consummate the Merger, or on the consummation of, whether by prevention or material delay, any of the Merger and the other transactions contemplated by the Merger Agreement.

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For purposes of the Merger Agreement, a “Parent Material Adverse Effect” means the impairment in any material respect of the ability of each of Edwards and Merger Sub, as the case may be, to perform its obligations under the merger agreement or to consummate the merger and pay the merger consideration, or prevent or materially delay the consummation of any of the merger and the other transactions contemplated by the merger agreement.

Conduct of Business Pending the Merger

Pursuant to the merger agreement, CASMED covenants and agrees that, between the date the merger agreement and the earlier of the effective time of the merger and the date, if any, on which this the merger agreement is terminated in accordance with the provisions thereof, except as prohibited or required by applicable Law, as may be consented to in writing by Edwards, as may be expressly required pursuant to the merger agreement, or as set forth on CASMED’s disclosure letter, CASMED shall, and shall cause each of its subsidiaries to, conduct the business of CASMED and its subsidiaries in all material respects in the ordinary course of business and in a manner consistent with past practice and, to the extent consistent therewith, use reasonable best efforts to preserve its assets and business organization intact in all material respects and maintain its existing business relations and goodwill with customers, suppliers, licensors, distributors, governmental authorities, independent contractors, employees, business partners and others having material business relationships with it. Without limiting the generality of foregoing, CASMED has agreed to certain restrictions on its and its subsidiaries ability to take certain actions between signing of the merger agreement and the effective time, including:

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amend or otherwise change the certificate of incorporation or the bylaws (or such similar organizational or governing documents of any subsidiary of CASMED);

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adjust, split, reverse split, combine, subdivide, reclassify, redeem, purchase, repurchase or otherwise acquire, directly or indirectly, or amend the terms of, CASMED’s or any of its subsidiaries’ securities, including any options, equity or equity-based compensation, warrants, convertible securities or other rights of any kind to acquire any of such securities;

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issue, sell, pledge, modify, transfer, dispose of, encumber or grant, or authorize the same with respect to, directly or indirectly, any of CASMED’s or any of its subsidiaries’ securities, including

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any options, equity or equity-based compensation, warrants, convertible securities or other rights of any kind to acquire such securities (other than with respect to the exercise of outstanding stock options or warrants or the conversion of the CASMED preferred stock, and pursuant to automatic exercise rights under the ESPP on the last day of any applicable offering period thereunder (subject to the termination of such period under merger agreement));

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declare, set aside, authorize, make or pay any dividend or other distribution payable in cash, stock, property or otherwise with respect to CASMED’s or any of its subsidiaries’ securities, other than ordinary course accretion with respect to CASMED’s preferred stock in accordance with CASMED’s certificate of incorporation;

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establish, adopt, enter into, materially amend or terminate any benefit plan, or any plan, program, policy, practice, agreement or other arrangement that would be a benefit plan if it had been in existence on the date of the merger agreement (other than offer letters that provide for at-will employment without either severance or change in control benefits); grant or pay, or commit to grant or pay, any bonus, incentive or profit-sharing award or payment, or increase the base salary and/or cash bonus opportunity to any director, officer, employee, or consultant of CASMED or any subsidiary, except in each case, as required by applicable law or under the terms of any benefit plan disclosed in CASMED’s disclosure letter and in effect as of the date of the merger agreement or in the case of increases in annual base salaries and the payment or grant of cash incentive compensation payable to any of its current employees who are not officers, at times and in dollar amounts in the ordinary course of business in connection with CASMED’s annual salary review process consistent with past practice; accelerate or take any action to accelerate any payment or benefit, or the funding of any payment or benefit, payable or to become payable to any current or former director, officer, employee, or consultant of CASMED or any subsidiary except as required under the terms of any benefit plan in effect as of the date of the merger agreement; enter into, extend, amend or modify, or terminate any employment, severance, termination, change in control, retention, individual consulting or other similar agreement with any current or former director, officer, employee, or consultant of, or individual service provider to, CASMED or any of its subsidiaries (other than offer letters that provide for at-will employment without any severance, retention or change in control benefits for newly hired employees or individual service providers who are hired in the ordinary course of business and consistent with past practice and whose annual base compensation does not exceed $180,000 individually); or communicate with the employees of the CASMED or any of its subsidiaries regarding the compensation, benefits or other treatment they will receive following the effective time of the merger, unless such communication is approved by Edwards in advance of such communication or required by applicable law;

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hire, promote or terminate the employment of  (other than for cause, death or disability) any employee at a level of Vice President or higher, with annual base compensation above $180,000, or outside the ordinary course of business;

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take any action requiring notice to employees, or triggering any other obligations, under the WARN Act or any similar state, local or foreign law prior to the closing date of the merger;

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waive, release or limit any restrictive covenant of any current or former employee or independent contractor of CASMED or any subsidiary;

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make any loan or advance to (other than travel and similar advances to its employees in the ordinary course of business and consistent with past practice), or capital contribution to, or investment (other than purchases of inventory or supplies in the ordinary course of business consistent with past practice or capital expenditures permitted pursuant the merger agreement) in, any person;

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forgive any loans or advances to any officers, employees or directors of CASMED or any of its subsidiaries, or any of their respective affiliates, or change its existing borrowing or lending arrangements for or on behalf of any of such Persons pursuant to an employee benefit plan or otherwise;

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acquire (including by merger, consolidation, acquisition of stock or assets or otherwise) any corporation, partnership, limited liability company, joint venture, other business organization, any division of any of the foregoing, any equity interest in any of the foregoing, any real property or any interest therein, or all or any material portion of the assets, business or properties of any person;

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sell, pledge, dispose of, transfer, abandon, lease (as lessor), license (except in accordance with the merger agreement) mortgage, incur any lien on or otherwise transfer or encumber any material portion of the tangible or intangible assets, business, any real property or any interest therein, properties or rights of CASMED or any of its subsidiaries except sales of product inventory or disposal of immaterial tangible assets in the ordinary course of business and consistent with past practice; (other than permitted liens);

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enter into any new line of business;

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create any new subsidiaries;

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pay, discharge or satisfy any indebtedness that has a prepayment cost, “make whole” amount, prepayment penalty or similar obligation (other than indebtedness incurred by CASMED or its wholly owned subsidiaries and solely owed to CASMED or its wholly owned subsidiaries) or cancel any material indebtedness (individually or in the aggregate) or settle, waive or amend any material claims or rights;

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incur, create, assume or otherwise become liable or responsible (whether directly, indirectly, contingently or otherwise) for any indebtedness, including by the issuance of any debt security, other than draw-downs pursuant to CASMED’s existing revolving loan facility or the payment of annual insurance policy premiums in monthly installments in accordance with past practice, assume, guarantee, endorse or otherwise become liable or responsible (whether directly, indirectly, contingently or otherwise) for any indebtedness of any person, including by the issuance of any debt security and the assumption or guarantee of obligations of any person (or enter into a “keep well” or similar arrangement) or issue or sell any debt securities of CASMED or any of its subsidiaries, including options, warrants, calls or similar rights, in each case, to acquire any debt securities of CASMED or any of its subsidiaries;

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amend, extend, renew, terminate (other than at its stated termination date) or enter into, or agree to any amendment or modification of, or waive, release or assign any material rights under, any material contract, any contract that would have been a material contract or a lease had it been entered into prior to the date of merger agreement or any lease for any leased real property (subject to certain exceptions), in the ordinary course of business consistent with past practice; provided, however, that the foregoing exception shall not apply to any contract that requires or provides for consent, acceleration, termination or any other material right or consequence triggered in whole or in part by the merger or any of the other transactions contemplated by the merger agreement;

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negotiate, amend, modify, extend, enter into or terminate any labor agreement, except as required pursuant to an applicable contract in effect as of the date of the merger agreement;

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make any material change to its or any of its subsidiaries’ methods, policies and procedures of accounting, except as required by GAAP or Regulation S-X of the Exchange Act;

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make or agree to make any capital expenditures exceeding $100,000 in the aggregate, other than the consignment of CASMED’s products to customers in the ordinary course of business;

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agree to, or otherwise commence to, release, compromise, assign, settle, or resolve, in whole or in part, any threatened or pending proceeding or insurance claim, other than settlements that result solely in monetary obligations involving payment (without the admission of wrongdoing) by CASMED or any of its subsidiaries of an amount not greater than $100,000 (net of insurance proceeds) in the aggregate;

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fail to use reasonable best efforts to maintain in effect material insurance policies covering CASMED and its subsidiaries and their respective properties, assets and businesses;

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sell, transfer, assign, lease, license or otherwise dispose of  (whether by merger, stock or asset sale or otherwise) to any person any rights to any intellectual property material to CASMED and its subsidiaries, taken as a whole (except for licensing non-exclusive rights for the primary purpose of conducting clinical research, entered into with a clinical research organization; material transfer, sponsored research or other similar matters; establishing confidentiality or non-disclosure obligations; conducting clinical trials; or manufacturing, labeling or selling CASMED’s or any of its subsidiaries’ products); cancel, dedicate to the public, disclaim, forfeit, reissue, reexamine or abandon without filing a substantially identical counterpart in the same jurisdiction with the same priority or allow to lapse (except with respect to patents expiring in accordance with their terms) any of CASMED’s intellectual property; fail to make any filing, pay any fee, or take any other action necessary to prosecute and maintain in full force and effect any registered intellectual property including allowing any such patent families with pending applications to close by not filing a continuing application; make any change in CASMED’s intellectual property that is or would reasonably be expected to materially impair CASMED’s or any of its subsidiaries’ rights with respect to CASMED’s intellectual property; disclose to any person (other than representatives of Edwards and Merger Sub), any trade secrets, know-how or confidential or proprietary information, except, in the case of confidential or proprietary information to a person that is subject to confidentiality obligations; or fail to take or maintain reasonable measures to protect the confidentiality and value of trade secrets included in CASMED’s intellectual property;

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except as required by applicable law, make or change any tax election or adopt or change any method of tax accounting; file any amended material tax return except in the ordinary course of business; settle or compromise any audit, assessment or other proceeding relating to taxes that could have a material effect on CASMED or its subsidiaries in any taxable period (or portion thereof) starting on or after the closing of the merger; agree to an extension or waiver of the statute of limitations with respect to income or other material taxes; enter into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local or non-U.S. law) with respect to any tax; or surrender any right to claim a tax refund;

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merge or consolidate CASMED or any of its subsidiaries with any person or adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization of CASMED or any of its subsidiaries; or

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enter into any agreement, contract, commitment or arrangement to do, or adopt any resolutions approving or authorizing, or announce an intention to do, any of the foregoing.

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Proxy Statement and CASMED Stockholders’ Meeting

The merger agreement requires that CASMED shall use reasonable best efforts to file the preliminary Proxy Statement with the SEC as soon as reasonably practicable (and in any event will file the preliminary Proxy Statement within fifteen (15) business days after the date of the merger agreement). CASMED shall use its reasonable best efforts to respond to any comments of the SEC or its staff, to clear the preliminary Proxy Statement with the SEC as promptly as reasonably practicable after filing and to cause the Proxy Statement to be mailed to CASMED’s stockholders as promptly as reasonably practicable thereafter. CASMED shall advise Edwards promptly after receipt of any request by the SEC or its staff for amendments or supplements to the Proxy Statement or comments thereon and responses thereto or requests by the SEC or its staff for additional information. CASMED shall promptly provide Edwards with copies of all written correspondence between CASMED (or its representatives) and the SEC (or its staff) regarding the Proxy Statement or the merger. If at any time prior to the special meeting of CASMED’s stockholders called for purposes of approving the merger there shall occur any event that is required to be set forth in an amendment or supplement to the Proxy Statement, CASMED shall as promptly as reasonably practicable prepare and mail to its stockholders such an amendment or supplement. Notwithstanding anything to the contrary stated above, prior to filing or mailing the Proxy Statement (or any amendment or supplement thereto) or responding to any comments of the SEC (or its staff) with respect thereto, CASMED shall provide Edwards an opportunity to review and comment on such

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document or response (and CASMED shall give reasonable consideration to all reasonable comments provided by Edwards or its representatives)

Subject to the earlier termination of the merger agreement in accordance with its termination provisions, CASMED shall, as soon as reasonably practicable following the date of the merger agreement (in consultation with Edwards), conduct one or more “broker searches,” establish a record date for, duly call, give notice of, convene and hold a meeting of its stockholders for the purpose of seeking CASMED’s stockholders’ approval of the proposed merger and shall submit such proposal to such holders at the stockholder meeting and, except for a proposal to adjourn the stockholders’ meeting if there are insufficient affirmative votes represented at the meeting to obtain the requisite stockholder approval of the proposed merger and any other proposal required by law, shall not submit any other proposal to such holders in connection with the stockholders’ meeting without the prior written consent of Edwards.

CASMED shall not change such record date for the stockholders’ meeting without the prior written consent of Edwards and shall not adjourn or otherwise postpone or delay the stockholders’ meeting without the prior written consent of Edwards; provided, however, that CASMED may, without the prior written consent of Edwards, adjourn or postpone the stockholders’ meeting:

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if as of the time for which the stockholders’ meeting is originally scheduled (as set forth in the Proxy Statement) there are insufficient shares of CASMED’s common stock represented (either in person or by proxy) to constitute a quorum necessary to conduct the business of the stockholders’ meeting;

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after consultation with Edwards, to the extent necessary to ensure the distribution of any supplement or amendment to the Proxy Statement required by law within a reasonable amount of time in advance of the stockholders’ meeting;

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if there are insufficient affirmative votes represented (either in person or by proxy) at the stockholders’ meeting to obtain the requisite stockholder approval; or

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after consultation with Edwards, to the extent otherwise required to comply with applicable law.

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The merger agreement further provides that, unless agreed to in writing by Edwards, any such adjournment or postponement under the first and third bullets above shall be for a period of no more than ten (10) business days each, and CASMED shall only be permitted to effect up to two (2) such adjournments or postponements pursuant to the first and third bullets above (in the aggregate). No postponement contemplated by the first and third bullets above shall be permitted if it would require a change to the record date for the stockholders’ meeting. If requested by Edwards, CASMED shall effect an adjournment or postponement of the stockholders’ meeting under the circumstances contemplated by the first and third bullets above for a period of up to ten (10) business days each (provided, however, that Edwards shall only make up to two (2) such requests, and no such request for a postponement shall be permitted if it would require a change in the record date for the stockholders’ meeting).

If CASMED’s board of directors has not made a Company Adverse Recommendation Change, CASMED shall, through its board of directors, make the recommendation that the CASMED stockholders adopt the merger agreement and approve the transactions contemplated by the merger agreement, including the merger (the “Company Recommendation”), and shall include such Company Recommendation in the Proxy Statement, and use its reasonable best efforts to solicit from its stockholders proxies in favor of the adoption of the merger agreement. Notwithstanding any Company Adverse Recommendation Change, unless the merger agreement is terminated in accordance with its terms, the foregoing obligations of CASMED shall continue in full force and effect and such obligations shall not be affected by the commencement, public proposal, public disclosure or communication to CASMED of any Company Acquisition Proposal (whether or not a Company Superior Proposal).

Immediately following the execution of the merger agreement, Edwards shall execute and deliver, in accordance with Section 228 of the DGCL and in its capacity as the sole stockholder of Merger Sub, a written consent adopting the merger agreement.

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Non-Solicitation of Alternative Proposals

From the date of the merger agreement until the earlier of the effective time of the merger or the termination of the merger agreement in accordance with its terms, except as expressly permitted in connection with a Company Acquisition Proposal or a Company Superior Proposal (each as described below), CASMED shall immediately cease and cause to be terminated, and shall cause its subsidiaries and its subsidiaries’ representatives to immediately cease and cause to be terminated, all existing activities, discussions, negotiations and communications, if any, with any persons with respect to any Company Acquisition Proposal other than Edwards or any of its affiliates. Furthermore, CASMED shall not, and shall cause its subsidiaries and its and its subsidiaries’ representatives to not, directly or indirectly:

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initiate, seek, solicit, facilitate or knowingly encourage, or induce or take any other action designed or intended to lead to, or that would reasonably be expected to lead to any inquiry with respect to, or the making, submission or announcement of, any company acquisition proposal;

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enter into, continue or otherwise participate in any negotiations or discussions with, or furnish or cause to be furnished any information or data to, or furnish access to CASMED’s (or any of its subsidiaries’) properties with respect to, or otherwise cooperate in any way with, any person relating to any Company Acquisition Proposal or any inquiry, proposal or offer that would reasonably be expected to lead to any Company Acquisition Proposal or grant any waiver or release under (or terminate, amend or modify any provision of), or fail to enforce to the fullest extent permitted under applicable law, any confidentiality or standstill or similar agreement (except if the failure to grant a waiver or release would be inconsistent with the board of directors’ fiduciary duties under applicable law);

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execute or enter into any binding or non-binding letter of intent, agreement in principle, memorandum of understanding, merger agreement, acquisition agreement, option agreement, joint venture agreement, partnership agreement or other agreement, commitment, arrangement or understanding relating to or in connection with, or that is intended to or would reasonably be expected to lead to, any Company Acquisition Proposal;

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submit to the stockholders of the CASMED for their approval any Company Acquisition Proposal or Company Superior Proposal; or

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resolve to do, or agree or announce an intention to do, any of the foregoing.

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The merger agreement requires that CASMED shall not provide (and will cause its subsidiaries and its and its subsidiaries’ representatives to not provide) and shall promptly (but in no event later than 24 hours following the date of the merger agreement) terminate access of any third person (and its representatives, other than Edwards or any of its affiliates or representatives) to any data room (virtual or actual) containing any of CASMED’s (or any subsidiary of the CASMED’s) confidential information granted in connection with, or with the intent of obtaining, any possible Company Acquisition Proposal.

The merger agreement requires that CASMED shall, and shall cause its subsidiaries and its and its subsidiaries’ representatives to, use their respective reasonable best efforts to cause any such third person (and its representatives, other than Edwards or any of its affiliates or representatives) in possession of confidential information about CASMED or any of its subsidiaries (or its or its subsidiaries’ businesses or operations) to return or destroy all such information, and CASMED shall within twenty-four (24) hours of the date the merger agreement, demand the return or destruction of all confidential information and materials provided to any third persons relating to a possible Company Acquisition Proposal.

The merger agreement also provides that, notwithstanding the foregoing limitations, at any time prior to obtaining the approval of the merger agreement by CASMED’s stockholders, if CASMED or its representatives receive a bona fide written Company Acquisition Proposal from a third person that did not result from a breach of the non-solicitation provisions of the merger agreement, then CASMED may (i) furnish information concerning its business, properties or assets to such third person pursuant to a customary confidentiality agreement that (a) does not contain any provision prohibiting or otherwise restricting CASMED’s ability to comply with any of the terms of the Merger Agreement and (b) contains provisions that are no less favorable in the aggregate to CASMED, or less restrictive to the party making such Company Acquisition Proposal (in comparison to Edwards), than those contained in the

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confidentiality agreement between CASMED and Edwards (provided, however, that such agreement need not contain any standstill agreement or similar obligation) (referred to as an “Acceptable Confidentiality Agreement”) and (ii) negotiate and participate in discussions and negotiations with such third person concerning such Company Acquisition Proposal, in each case of clause (i) and (ii), if and only if the CASMED board of directors determines in good faith (after consultation with CASMED’s financial advisors and outside legal counsel) that (x) such Company Acquisition Proposal constitutes or is reasonably likely to constitute a Company Superior Proposal and (y) the failure to take such action would be inconsistent with the board of directors’ fiduciary duties under applicable law.

CASMED has agreed in the merger agreement that it shall promptly (and in any case within twenty-four (24) hours) provide Edwards notice of the receipt of any Company Acquisition Proposal, which notice shall include a complete, unredacted copy of such Company Acquisition Proposal, and of any inquiries, proposals or offers received by, any requests for information from, or any discussions or negotiations sought to be initiated or continued with, CASMED, any of its subsidiaries or any of its or its subsidiaries’ representatives concerning a Company Acquisition Proposal or proposal that is reasonably likely to constitute or lead to or result in a Company Acquisition Proposal, and disclose the identity of the other party (or parties) and the terms (including any amendments thereto) of such inquiry, offer, proposal, request, discussion or negotiation and, in the case of written materials, provide copies of such materials.

CASMED has also agreed in the merger agreement that it shall substantially concurrently (and in any case within twenty-four (24) hours) make available to Edwards all information, including copies of all written materials, provided by CASMED or any of its subsidiaries or its or its subsidiaries’ representatives to such party but not previously made available to Edwards and shall keep Edwards reasonably informed on a prompt basis (and, in any case, within twenty-four (24) hours of any significant development, discussions or negotiations) of the status and details (including amendments and proposed amendments) of any such company acquisition proposal or other inquiry, offer, proposal, request, discussion or negotiation (which shall include copies of all drafts and final versions (and any comments thereon) of agreements (including schedules and exhibits thereto) relating to any company acquisition proposal exchanged between the CASMED or its subsidiaries or any of its or its subsidiaries’ representatives in each case thereof, on the one hand, and the person making such company acquisition proposal or such other inquiry, offer or proposal, on the other hand).

For purposes of the merger agreement, the term “Company Acquisition Proposal” means an inquiry, proposal or offer (whether or not in writing) from any person (other than Edwards or any of its subsidiaries) relating to, or that is reasonably expected to lead to (in one transaction or a series of transactions), any:

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merger, consolidation, share exchange, business combination, recapitalization, reorganization, dissolution, liquidation, joint venture or similar transaction involving CASMED or any subsidiary of CASMED, pursuant to which any person would beneficially own or control, directly or indirectly, fifteen percent (15%) or more (on a non-diluted basis) of any class of equity or voting securities of CASMED or any subsidiary of CASMED or any resulting Edwards company of CASMED or any of its subsidiaries;

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sale, lease, license or other disposition, directly or indirectly, of assets of CASMED (including capital stock or other equity interests of any of its Subsidiaries) or any subsidiary of CASMED representing in the aggregate fifteen percent (15%) or more of the consolidated assets, net revenues or net income of CASMED and its subsidiaries taken as a whole, or to which fifteen percent (15%) or more of the revenue, earnings or assets of CASMED and its subsidiaries, taken as a whole and on a consolidated basis, are attributable;

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issuance or sale or other disposition of capital stock or other equity interests representing fifteen percent (15%) or more (on a non-diluted basis) of any class of equity or voting securities of CASMED;

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tender offer, exchange offer or any other transaction or series of transactions that, if consummated, would result in any person, directly or indirectly, beneficially owning or having the right to acquire beneficial ownership of capital stock or other equity interests representing fifteen percent (15%) or more (on a non-diluted basis) of any class of equity or voting securities of CASMED; or

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a combination of the foregoing.

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For purposes of the merger agreement, the term “Company Superior Proposal” means a bona fide written Company Acquisition Proposal made after the date of the merger agreement (with all references to fifteen percent (15%) in the definition of  “Company Acquisition Proposal” being deemed to be references to eighty percent (80%)) that did not result from a breach of the non-solicitation provisions of the merger agreement and is on terms that CASMED’s board of directors determines in good faith, after consultation with CASMED’s financial advisor and outside legal counsel and taking into account at the time of determination all relevant circumstances, including the various legal, financial, regulatory and other aspects or conditions of such Company Acquisition Proposal (including but not limited to any financing requirements and the ability of the person making such proposal to consummate the transactions contemplated by such proposal):

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to be reasonably likely to be consummated if accepted; and

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to be more favorable to the holders of CASMED’s preferred and common stock from a financial point of view than the merger agreement and the transactions contemplated thereby.

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Change of Recommendation

The merger agreement provides that CASMED’s board of directors will not effect a Company Adverse Recommendation Change except in the limited circumstances described below. For purposes of the merger agreement, a “Company Adverse Recommendation Change” would occur if CASMED’s board of directors, or any committee thereof, shall:

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withdraw, qualify or modify in a manner adverse to Edwards, or publicly propose to withdraw, qualify or modify in a manner adverse to Edwards, the Company Recommendation;

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approve, authorize, declare advisable, endorse or recommend (or publicly propose to approve, authorize, declare advisable, endorse or recommend) any Company Acquisition Proposal;

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fail to include in the proxy statement the Company Recommendation;

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fail to publicly reaffirm the Company Recommendation within ten (10) business days of receipt of a written request by Edwards to provide such reaffirmation following public disclosure of any Company Acquisition Proposal; or

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fail to recommend against any Company Acquisition Proposal that is a tender or exchange offer subject to Regulation 14D under the Exchange Act in a Solicitation/Recommendation Statement on Schedule 14D-9 within ten (10) business days after the commencement (within the meaning of Rule 14d-2 under the Exchange Act) of such tender or exchange offer.

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If at any time prior to the receipt of the approval of CASMED’s stockholders, CASMED or its board of directors receives a Company Superior Proposal that did not result from a breach of the non-solicitation provisions of the merger agreement, CASMED’s board of directors may authorize and cause CASMED to effect a Company Adverse Recommendation Change and terminate the merger agreement in accordance with its terms and concurrently with such termination enter into a definitive agreement providing for such Company Superior Proposal (subject to the satisfaction of its obligations pursuant to the merger agreement’s termination fees requirement) if:

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CASMED’s board of directors determines in good faith, after consultation with CASMED’s outside legal counsel, that the failure to take such action would be inconsistent with CASMED’s board of director’s fiduciary duties under applicable law;

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CASMED has notified Edwards in writing that it intends to effect a Company Adverse Recommendation Change and terminate the merger agreement;

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CASMED has provided Edwards a copy of the proposed definitive agreements (and any related agreements) relating to such Company Superior Proposal (and has informed Edwards of the identity of the person making such Company Superior Proposal);

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until 11:59 p.m., New York City time, on the fourth (4th) business day following delivery of the notice described in the second bullet above, CASMED and its representatives shall have discussed and negotiated with Edwards in good faith (to the extent Edwards requests to negotiate) any proposed modifications to the terms and conditions of the merger agreement (it being understood and agreed that any amendment to any material term or condition of any Company Superior Proposal shall require a new notice and a new negotiation period, which shall expire at 11:59 p.m., New York City time, on the fourth (4th) business day following the delivery of such new notice); and

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no earlier than the end of such negotiation period, CASMED’s board of directors shall have determined in good faith (after consultation with CASMED’s financial advisor and outside legal counsel), after considering and taking into account the terms of any proposed amendment or modification to the merger agreement made by Edwards in writing during such period, that the Company Acquisition Proposal that is the subject of the notice still constitutes a Company Superior Proposal and the failure to take such action would be inconsistent with CASMED’s board of director’s fiduciary duties under applicable law.

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The merger agreement does not prohibit CASMED or CASMED’s board of directors from:

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taking and disclosing to its stockholders a position contemplated by Rules 14d-9 and 14e-2(a) promulgated under the Exchange Act, or from issuing a “stop, look and listen” statement pending disclosure of its position thereunder; or

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making any disclosure to its stockholders if CASMED’s board of directors determines in good faith, after consultation with CASMED’s outside legal counsel, that the failure of the CASMED’s board of directors to make such disclosure would be inconsistent with the board of director’s fiduciary duties under applicable law.

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Directors’ and Officers’ Indemnification and Insurance

Pursuant to the merger agreement, Edwards and Merger Sub agree that all rights to indemnification and exculpation from liabilities, including advancement of expenses, for acts or omissions occurring at or prior to the effective time of the merger agreement now existing in favor of each person who is now, or has been at any time prior to the date hereof or who becomes prior to the effective time of the merger agreement a director or officer of CASMED or any of its subsidiaries that are provided in the certificate of incorporation, the bylaws or any indemnification contract between such directors or officers and CASMED (in each case, as in effect on, and in the case of any indemnification contracts, to the extent made available to Edwards prior to, the date of the merger agreement) shall survive the merger and shall continue in full force and effect. For a period of six (6) years from the effective time of the merger, the surviving corporation shall, and Edwards shall cause the surviving corporation to, maintain in effect the exculpation, indemnification and advancement of expenses at least equivalent to the provisions of the certificate of incorporation and bylaws as in effect immediately prior to the effective time of the merger solely with respect to acts or omissions occurring prior to the effective time of the merger and shall not amend, repeal or otherwise modify any such provisions in any manner that would adversely affect the rights thereunder of any of the applicable individuals; provided, however, that all rights to indemnification in respect of any action pending or asserted or any claim made for indemnification within such period shall continue until the disposition of such action or resolution of such claim. From and after the effective time of the merger, Edwards shall guarantee as surety for, and shall cause the surviving corporation to honor, in accordance with their respective terms, each of these covenants.

Prior to the effective time of the merger, CASMED shall or, if CASMED is unable to, Edwards shall cause the surviving corporation as of or after the effective time of the merger to, purchase a six (6)-year prepaid “D&O tail” insurance policy, with terms, conditions, retentions and limits of liability that are no less favorable than the coverage provided under CASMED’s existing policies of directors’ and officers’ liability insurance and fiduciary liability insurance, in each case with respect to matters arising on or before

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the effective time of the merger (including in connection with the merger agreement and the transactions or actions contemplated by the merger agreement), and Edwards shall cause such policy to be maintained in full force and effect, for its full term, and cause all obligations thereunder to be honored by the surviving corporation, and no other party shall have any further obligation to purchase or pay for insurance hereunder; provided, however, that CASMED shall not pay, and the surviving corporation shall not be required to pay, in excess of 300% of the last annual premium paid by CASMED prior to the date of the merger agreement in respect of such “tail” policy. If CASMED or the surviving corporation for any reason fail to obtain such “tail” insurance policies prior to, as of or after the effective time of the merger, Edwards shall, for a period of six (6) years from the effective time of the merger, cause the surviving corporation to maintain in effect the current policies of directors’ and officers’ liability insurance and fiduciary liability insurance maintained by CASMED with respect to matters arising on or before the effective time of the merger. After the effective time of the merger, Edwards shall not be required to pay annual premiums in excess of 300% of the last annual premium paid by CASMED prior to the date of the merger agreement in respect of the coverage required to be obtained pursuant to the terms of the merger agreement, but in such case shall purchase as much coverage as reasonably practicable for such amount.

The covenants contained related to the directors’ and officers’ indemnification and insurance survive the consummation of the merger and are intended to be for the benefit of, and shall be enforceable by, each of the indemnified parties and their respective heirs and shall not be deemed exclusive of any other rights to which any such person is entitled, whether pursuant to law, contract or otherwise. Such covenants shall not be terminated or modified after consummation of the merger in such a manner to adversely affect any indemnified party without the consent of such indemnified party.

In the event that Edwards or the surviving corporation or any of their respective successors or assigns consolidates with or merges into any other Person and shall not be the continuing or surviving corporation or entity of such consolidation or merger or transfers or conveys all or substantially all of its properties and assets to any person, then, and in each such case, Edwards and the surviving corporation shall cause proper provision to be made so that the successors or assigns of Edwards or the surviving corporation, as the case may be, shall assume the obligations set forth with respect to the directors’ and officers’ indemnification and insurance.

Public Disclosure

Edwards and CASMED shall mutually agree on the initial press release or releases with respect to the execution of the merger agreement. Thereafter, subject to certain exceptions, so long as the merger agreement is in effect, neither CASMED nor Edwards, nor any of their respective affiliates, shall issue any press release or other announcement with respect to the merger, the other transactions contemplated by the merger agreement or the merger agreement without the prior consent of the other party (such consent not to be unreasonably withheld) except as such press release or other announcement may be required by law or the rules of a national securities exchange or trading market on which such party’s securities are listed, in which case the party required to make the release or announcement shall use its reasonable best efforts to provide the other party with a reasonable opportunity to review and comment on such release or announcement in advance of its issuance.

Intellectual Property Matters

CASMED has agreed, prior to the closing of the merger, to use all reasonable efforts to ensure that title in all of its registered intellectual property is recorded in the name of CASMED or one or more of its subsidiaries, as applicable, and to the extent that any such intellectual property is recorded in any governmental registry in the name of any person or there are outstanding encumbrances of any type against such intellectual property, to use all reasonable efforts to obtain appropriate assignments, discharges or other documents intended to place record ownership in the name of CASMED or any of its subsidiaries and/or effect the discharge prior to the closing, as applicable. CASMED shall use all reasonable efforts to ensure that all maintenance, annuity and other fees and all filings necessary to assure the continued enjoyment of any issued CASMED registered intellectual property, and all amendments, responses to office actions, issue fees and other fees and filings necessary to maintain the pendency of and pursue the prosecution of any pending applications, including the filing of continuation applications, have been and will be paid or filed on a timely basis through the closing.

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Employee Matters

The merger agreement provides that, for the period commencing as of the effective time of the merger agreement and ending on the earlier of  (i) the date that is twelve (12) months following the effective time of the merger agreement and (ii) the date on which the employment of an employee of CASMED or any of its subsidiaries who continues his or her employment with Edwards, the surviving corporation or any of their respective affiliates following the effective time of the merger agreement terminates, Edwards, the surviving corporation or any of their respective Affiliates shall provide each continuing employee with:

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an annual base salary at least equal to the annual base salary provided to such continuing employee immediately prior to the effective time of the merger agreement;

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cash bonus opportunities that are no less favorable than the cash bonus opportunities provided to similarly situated employees of Edwards and its affiliates; and

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employee benefits that are no less favorable (in the aggregate) to the employee benefits (including severance benefits but excluding for such purposes any change in control, retention, equity or equity-related benefits, and any defined benefit pension benefits) provided to similarly situated employees of Edwards and its affiliates.

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Pursuant to the merger agreement, if the closing of the merger occurs after the completion of the 2018 fiscal year but prior to the payment of bonuses with respect to such fiscal year, Edwards or its subsidiaries (including the surviving corporation) shall pay an annual bonus under the applicable bonus plans of CASMED and its Subsidiaries in respect of the 2018 fiscal year to each eligible employee of CASMED or any of its subsidiaries based on actual performance levels, which payment shall be made at the time such bonuses would ordinarily be paid to eligible employees by CASMED and its subsidiaries pursuant to the terms of such plans and in compliance with Section 409A of the Code; provided that if such employee is terminated by CASMED or its subsidiaries without cause prior to the payment date, such bonus shall be paid on such employee’s termination date. If the Closing occurs during the 2019 fiscal year, Edwards or its subsidiaries (including the surviving corporation) shall pay a pro-rated annual bonus under the applicable bonus plans of CASMED and its subsidiaries in respect of the portion of the 2019 fiscal year that occurs prior to the closing of the merger to each eligible employee of CASMED or any of its subsidiaries based on target level performance through the date of closing of the merger, which payment will be made at the time such bonuses would ordinarily be paid by CASMED and its subsidiaries pursuant to the terms of such plans, but in no event later than March 15, 2020.

Edwards agrees that each continuing employee shall, as of the effective time of the merger agreement, receive full credit for service with CASMED or any of its subsidiaries prior to the effective time of the merger agreement for purposes of determining eligibility to participate, vesting and with respect to severance and vacation policies only, level of benefit under the employee benefit plans, programs and policies of Edwards, the surviving corporation or any of their respective affiliates in which such continuing employee becomes a participant (excluding any equity or equity-related benefit plan or any defined benefit pension plan); provided, however, that such service credit shall not result in the duplication of any benefits for the same period of service. With respect to each health or welfare benefit plan maintained by Edwards, the surviving corporation or any of their respective affiliates for the benefit of continuing employees (including any medical, dental, pharmaceutical or vision benefit plans), Edwards shall use its commercially reasonable efforts to cause to be waived any eligibility waiting periods, any evidence of insurability requirements or required physical examinations, actively-at-work requirements and the application of any pre-existing condition limitations under such plan to the extent such were waived or satisfied under the comparable health or welfare benefit plan of CASMED or any of its subsidiaries immediately prior to the effective time of the merger agreement; and cause each continuing employee to be given credit under such plan for all amounts paid (or otherwise deemed paid) by such continuing employee under any similar benefit plan for the plan year that includes the effective time of the merger agreement for purposes of applying deductibles, co-payments and out-of-pocket maximums as though such amounts had been paid in accordance with the terms and conditions of the plans maintained by Edwards, the surviving corporation or any of their respective affiliates, as applicable, for the plan year in which the effective time of the merger agreement occurs; provided, however, that Edwards’ obligations to such continuing employees shall be

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subject to its receipt of all necessary information, from either CASMED or such continuing employee, related to such amounts paid by such continuing employee.

Unless otherwise directed in writing by Edwards at least ten (10) business days prior to the effective time of the merger agreement, CASMED shall terminate, effective as of at least one (1) day prior to the closing date of the merger agreement, any and all benefit plans intended to include a Code Section 401(k) arrangement. No later than five (5) business days prior to the closing date, CASMED shall provide Edwards with evidence that CASMED has taken action to terminate each 401(k) Plan (effective as of no later than one (1) day prior to the closing date of the merger agreement) pursuant to resolutions of CASMED’s board of directors. The form and substance of such resolutions shall be subject to review and approval of Edwards (which shall not be unreasonably withheld or delayed).

Edwards will have no obligation to continue to employ or retain the services or any continuing employee for any period of time following the closing of the merger.

Conditions to the Merger

The merger agreement requires that each party’s obligations pursuant to the merger agreement are subject to the satisfaction or (to the extent permitted by law) waiver by CASMED or the Edwards at or prior to the effective time of the merger agreement of the following conditions:

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CASMED shall have obtained the approval of the merger agreement from the holders of a majority of the aggregate voting power of the outstanding shares of CASMED’s common stock and CASMED’s Series A Convertible Preferred Stock and the Series A Exchangeable Preferred Stock, voting together as a single class, the holders of a majority of the outstanding shares of Series A Convertible Preferred Stock, voting separately as a class, and the holders of a majority of the outstanding shares of Series A Exchangeable Preferred Stock, voting separately as a class;

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any applicable waiting period (and any extension thereof) under the HSR Act relating to the consummation of the merger shall have expired or termination thereof shall have been granted and any authorization or consent from a governmental authority required to be obtained with respect to the merger under any antitrust law as set forth on CASMED’s disclosure letter shall have been obtained and shall remain in full force and effect; and

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no governmental authority of competent jurisdiction shall have issued or entered any order after the date of the merger agreement, and no law shall have been enacted or promulgated after the date of the merger agreement, in each case, that is then in effect and has the effect of restraining, enjoining or otherwise prohibiting the consummation of the merger or the other transactions contemplated by the merger agreement.

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Pursuant to the merger agreement, the obligations of Edwards and Merger Sub to effect the merger and the other transactions contemplated by the merger agreement are subject to the satisfaction or (to the extent permitted by law) waiver by Edwards at or prior to the effective time of the merger agreement of the following additional conditions:

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the representations and warranties of CASMED with respect to certain capital structure representations, authorization, the requisite company vote, conflicts with CASMED’s or any subsidiary’s certificate of incorporation or bylaws (or equivalent organizational documents), lack of a Company Material Adverse Effect (as described above), takeover statutes, brokers and the opinion of William Blair shall be true and correct in all respects (except with respect to certain capital structure representations for any de minimis inaccuracy) both as of the date of the merger agreement and as of the effective time of the merger as if made at and as of such time (other than any such representation or warranty that is made as of a specified date, which representation or warranty shall be so true and correct as of such specified date);

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the representations and warranties of CASMED with respect to organization and qualification and certain other capital structure representations (without giving effect to any materiality qualifiers therein) shall be true and correct in all material respects both as of the date of the

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merger agreement and as of the effective time of the merger agreement as if made at and as of such time (other than any such representation or warranty that is made as of a specified date, which representation or warranty shall be true and correct as of such specified date);

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the other representations and warranties of CASMED contained in the merger agreement (without giving effect to any materiality or similar qualifiers contained therein) shall be true and correct both as of the date of the merger agreement and as of the effective time of the merger as if made at and as of such time (other than any such representation or warranty that is made as of a specified date, which representation or warranty shall be so true and correct as of such specified date), except where the failure of such representations and warranties to be true and correct, individually or in the aggregate, has not had, and would not reasonably be expected to have, a Company Material Adverse Effect;

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CASMED shall have performed or complied in all material respects with its obligations required under the merger agreement to be performed or complied with on or prior to the effective time of the merger;

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since the date of the merger agreement, there shall not have been any effect, change, development, event, circumstance, occurrence, condition, fact or state of facts that has had or would reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect;

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Edwards shall have received a certificate signed by an executive officer of CASMED certifying certain matters as required by the merger agreement;

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CASMED shall obtain and deliver to Edwards on or prior to the closing date of the merger agreement, a copy of any necessary consent or agreement from each holder of an option to purchase shares of CASMED common stock to effectuate the requirements of the merger agreement, in form and substance reasonably acceptable to Edwards, with respect to each option, in each case, executed by CASMED and the holder of such option, such that as of the effective time of the merger agreement, there shall be no outstanding options;

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all warrants shall have been exercised for shares of CASMED’s common stock or terminated, such that as of the effective time of the merger agreement, there shall be no outstanding warrants;

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CASMED shall obtain and deliver to Edwards on or prior to the closing date, a copy of any necessary consent or other instrument from each of the holders of CASMED preferred stock to effectuate the conversion of all of the shares of CASMED’s preferred stock into shares of common stock in accordance with the terms of CASMED’s certificate of incorporation, in form and substance reasonably acceptable to Edwards, such that immediately prior to the effective time of the merger there shall be no outstanding shares of CASMED’s preferred stock; and

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there shall not be any pending proceeding in a U.S. federal district court by any governmental authority against Merger Sub, Edwards, CASMED or any of their respective subsidiaries or affiliates seeking to restrain or prohibit Edwards or Merger Sub or any of their respective affiliates from retaining any portion of Edwards’ or Merger Sub’s or such affiliates’ assets or to restrain or prohibit Edwards or Merger Sub from acquiring any material portion of CASMED’s or any of its subsidiaries’ businesses or assets, or to compel Edwards or Merger Sub or their respective subsidiaries and affiliates to dispose of or hold separate any portion of the business or assets of CASMED, Edwards or their respective subsidiaries or affiliates in connection with the merger; challenging, seeking to restrain or prohibit the merger or the other transactions contemplated by the merger agreement or seeking to obtain from CASMED, Edwards or Merger Sub or their respective affiliates any material damages or other remedy in connection with the merger; seeking to impose material limitations on the ability of Merger Sub, or render Merger Sub unable, to consummate the merger or other transactions contemplated by the merger agreement; or seeking to impose limitations on the ability of Merger Sub or Edwards to exercise full rights of ownership of the shares of CASMED’s common stock.

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Pursuant to the merger agreement, the obligations of CASMED to effect the merger and the other transactions contemplated by the merger agreement are subject to the satisfaction or (to the extent permitted by law) waiver by CASMED at or prior to the effective time of the merger agreement of the following additional conditions:

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each of the representations and warranties of Edwards and Merger Sub contained in the merger agreement (without giving effect to any materiality or similar qualifiers contained therein) shall be true and correct as of the effective time of the merger agreement as though made on and as of such time (other than any such representation or warranty that is made as of a specified date, which representation or warranty shall be so true and correct as of such specified date), except where the failure of such representations and warranties to be true and correct, individually or in the aggregate, has not had, and would not reasonably be expected to have, a material adverse effect on Edwards or any of its subsidiaries;

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Edwards and Merger Sub shall have performed or complied in all material respects with each of their respective obligations required under the merger agreement to be performed or complied with on or prior to the effective time of the merger agreement; and

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CASMED shall have received a certificate signed by an executive officer of Edwards certifying as to certain matters as required by the merger agreement.

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Additional Covenants

The merger agreement also contains additional agreements relating to, among other things, access to information notification of certain matters, existing litigation securities regulation matters, and the payoff of an existing credit agreement.

Termination

The merger agreement may be terminated at any time before the effective time of the merger by mutual written consent of CASMED and Edwards. Additionally, either CASMED or Edwards may terminate the merger agreement under the following circumstances:

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if the merger shall not have been consummated on or before 5:00 P.M. (New York City time) on November 8, 2019 (the “Termination Date”); provided, however, that the right to terminate the merger agreement pursuant to this clause shall not be available to any party if the failure of such party to perform or comply with any of its obligations under the merger agreement in any material respect has been the principal cause of or principally resulted in the failure of the closing to have occurred on or before the Termination Date (it being understood that Edwards and Merger Sub shall be a single entity for purposes of the foregoing proviso);

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if any governmental authority of competent jurisdiction shall have issued or entered any order after the date of the merger agreement or any law shall have been enacted or promulgated after the date of the merger agreement that has the effect of permanently restraining, enjoining or otherwise prohibiting the merger or other transactions contemplated by the merger agreement, and in the case of such an order, such order shall have become final and non-appealable; provided, however, that the right to terminate the merger agreement under this clause shall not be available to a party if the failure of such party to perform or comply with any of its obligations under the merger agreement in any material respect has been the principal cause of or principally resulted in the issuance of such order (it being understood that Edwards and Merger Sub shall be a single entity for purposes of the foregoing proviso); or

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if the required approval from CASMED’s stockholders shall not have been obtained upon a vote taken thereon at CASMED’s stockholder’s meeting duly convened therefor or at any adjournment or postponement thereof at which a vote on the adoption of the merger agreement was taken.

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In addition, CASMED may terminate the merger agreement under the following circumstances:

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if Edwards or Merger Sub shall have breached or failed to perform any of their respective representations, warranties, covenants or other agreements set forth in the merger agreement,

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which breach or failure to perform would result in the failure of a condition required to complete the merger and is not capable of being cured by Edwards or Merger Sub, as applicable, by the Termination Date or, if capable of being cured, shall not have been cured by Edwards or Merger Sub on or before the earlier of the Termination Date and the date that is thirty (30) calendar days following CASMED’s delivery of written notice to Edwards of such breach or failure to perform; provided, however, that CASMED shall not have the right to terminate the merger agreement pursuant to this clause if CASMED is then in material breach of any of its obligations under the merger agreement so as to result in the failure of a condition required to complete the merger; or

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at any time prior to receipt of the required CASMED stockholder approval, in order for CASMED to enter into a definitive agreement with respect to a Company Superior Proposal to the extent permitted by, and subject to the applicable terms and conditions of the merger agreement as described above; provided, however, that immediately prior to or simultaneously with such termination, CASMED pays to Edwards the company termination fee (as described below).

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In addition, Edwards may terminate the merger agreement under the following circumstances:

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if CASMED shall have breached or failed to perform any of its representations, warranties, covenants or other agreements set forth in the merger agreement, which breach or failure to perform would result in the failure of a condition required to complete the merger and is not capable of being cured by CASMED by the Termination Date or, if capable of being cured, shall not have been cured by CASMED on or before the earlier of the Termination Date and the date that is thirty (30) calendar days following Edwards’ delivery of written notice to CASMED of such breach or failure to perform; provided, however, that Edwards shall not have the right to terminate the merger agreement pursuant to this clause if Edwards or Merger Sub is then in material breach of any of its obligations under the merger agreement so as to result in the failure of a condition required to complete the merger; or

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if CASMED’s board of directors shall have made a Company Adverse Recommendation Change or CASMED or CASMED’s board of directors, as applicable, shall have materially breached any of its obligations pursuant to the non-solicitation provisions of the merger agreement.

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Termination Fee and Reimbursement of Expenses

If the merger agreement is terminated by:

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Edwards pursuant to on the basis of a breach of a covenant or agreement contained in the merger agreement or either Edwards or CASMED due to failure to obtain the requisite stockholder approval or failure to consummate the merger by the Termination Date and prior to any such termination, a Company Acquisition Proposal has been publicly disclosed and not publicly withdrawn at least three (3) business days prior to the stockholders’ meeting or is otherwise known to CASMED’s board of directors and not withdrawn (publicly, if publicly disclosed) prior to such termination in the case of termination, and (2) within twelve (12) months after any such termination, any company acquisition proposal is consummated or CASMED enters into a definitive agreement with respect to any company acquisition proposal (regardless of when or whether such transaction is consummated) (provided, however, that for purposes of this provision of the merger agreement, the references to “fifteen percent (15%)” with all references to fifteen percent (15%) in the definition of  “company acquisition proposal” being deemed to be references to “fifty percent (50%)”);

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CASMED, prior to the requisite stockholder approval so that CASMED may enter into a Company Superior Proposal; or

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Edwards, if CASMED’s board of directors has made a Company Adverse Recommendation Change or CASMED or its board of directors are in material breach of the provisions in the merger agreement related to non-solicitation;

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then, in any such case, CASMED shall pay to Edwards a termination fee in the amount of  $3,500,000.

If the merger agreement terminated by either Edwards or CASMED due to the failure to obtain the requisite stockholder approval, CASMED shall pay Edwards the reasonable and documented out of pocket costs and expenses, including all fees and expenses incurred in connection with the financing of the transactions contemplated by the merger agreement and the fees and expenses of counsel, accountants, investment bankers, experts and consultants incurred by Edwards and Merger Sub in connection with the merger and the transactions contemplated thereby in an amount not to exceed $1,000,000; provided, however, that any payment shall not affect Edwards’ right to receive any transaction fee otherwise due pursuant to the provisions related to the termination fee, but shall reduce, on a dollar for dollar basis, any termination fee which becomes due and payable thereby.

The merger agreement states that in the event that the termination fee becomes payable and is paid by CASMED, then the termination fee is the sole and exclusive remedy for monetary damages for Edwards and Merger Sub under the merger agreement, except to the extent that any liability or damages result from any material and intentional breach of the merger agreement or fraud.

If CASMED fails to pay the termination fee when due, CASMED will also be required to pay any costs and expenses (including attorneys’ fees) incurred by Edwards in connection with any legal action taken in order to obtain such payment, together with interest on the amount due.

Waiver

At any time prior to the effective time of the merger, subject to applicable law, any party to the merger agreement may extend the time for the performance of any obligation or other act of any other party, waive any inaccuracy in the representations and warranties of the other party contained herein or in any document delivered pursuant to the merger agreement and waive compliance by any other party with any agreement or condition of such party contained herein (it being understood that Edwards and Merger Sub shall be a single entity for purposes of this clause). Any such extension or waiver shall only be valid if set forth in an instrument in writing signed by the party or parties to be bound thereby. Notwithstanding the foregoing, no failure or delay by CASMED, Edwards or Merger Sub in exercising any right hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise of any other right hereunder. Any agreement on the part of a party to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party.

Amendment

The merger agreement may be amended by mutual agreement of the parties in writing at any time; provided, however, that after the required CASMED stockholder approval has been obtained, there shall not be any amendment that by applicable law or in accordance with the applicable rules of any stock exchange requires further approval by the stockholders of CASMED without such further approval of such stockholders nor any amendment or change not permitted under applicable law.

Governing Law; Jurisdiction; Waiver of Jury Trial

The merger agreement and all proceedings arising out of or relating to the agreement or the actions of Edwards, Merger Sub or CASMED in the negotiation, administration, performance and enforcement thereof, shall be governed by, and construed in accordance with, the laws of the State of Delaware. Each of the parties, with respect to any legal claim or proceeding arising out of the merger agreement or the transactions contemplated by the merger agreement, expressly and irrevocably submits, for itself and with respect to its property, generally and unconditionally, to the exclusive jurisdiction of the Delaware Court of Chancery and any appellate court therefrom within the State of Delaware (or, if the Delaware Court of Chancery declines to accept jurisdiction over a particular matter, any state or federal court within the State of Delaware), agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such courts, agrees that it will not bring any claim or proceeding relating to the merger agreement or the transactions contemplated by the merger agreement except in such courts and irrevocably waives, to the fullest extent it may legally and effectively do so, and agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, any objection which it may now or hereafter have to

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the laying of venue of any claim or proceeding arising out of or relating to the merger agreement. Notwithstanding the foregoing, each of Edwards, Merger Sub and CASMED agrees that a final and nonappealable judgment in any proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Each of Edwards, Merger Sub and CASMED irrevocably waives all right to trial by jury in any action, proceeding or counterclaim (whether based on contract, tort or otherwise) between any of them directly or indirectly arising out of or relating to the merger agreement or the actions of Edwards, Merger Sub or CASMED in the negotiation, administration, performance and enforcement thereof.

Specific Performance

The parties agree that irreparable damage for which monetary damages, even if available, would not be an adequate remedy would occur in the event that any party does not perform the provisions of the merger agreement (including failing to take such actions as are required of it hereunder to consummate the merger agreement) in accordance with its specified terms or otherwise breaches such provisions. Accordingly, the parties acknowledge and agree that, prior to any valid termination of the merger agreement in accordance with its termination provision, in the event of any breach or threatened breach by CASMED, on the one hand, or Edwards or Merger Sub, on the other hand, of any of their respective covenants or obligations set forth in the merger agreement, CASMED, on the one hand, and Edwards and Merger Sub, on the other hand, shall be entitled to an injunction, specific performance and other equitable relief to prevent breaches or threatened breaches of the merger agreement and to enforce specifically the terms and provisions hereof, in addition to any other remedy to which they are entitled at law or in equity. Each of the parties agrees that, prior to any valid termination of the merger agreement in accordance with the termination provision, it will not oppose the granting of an injunction, specific performance and other equitable relief on the basis that any other party has an adequate remedy at law or that any award of specific performance is not an appropriate remedy for any reason at law or in equity. Any party seeking an injunction or injunctions to prevent breaches or threatened breaches of the merger agreement and to enforce specifically the terms and provisions of the merger agreement shall not be required to provide, furnish or post any bond or other security in connection with any such order or injunction, and each party hereby irrevocably waives any right it may have to require the provision, furnishing or posting of any such bond or other security.

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APPRAISAL RIGHTS

If the merger is consummated, stockholders who continuously hold shares of common stock through the effective time, who do not vote in favor of the adoption of the merger agreement and who properly demand appraisal of their shares and who do not withdraw their demands or otherwise lose their rights of appraisal will be entitled to seek appraisal of their shares in connection with the merger under Section 262 the DGCL (“Section 262”). The following discussion is not a complete statement of the law pertaining to appraisal rights under the DGCL and is qualified in its entirety by the full text of Section 262, which is attached to this proxy statement as Annex C and incorporated herein by reference. The following summary does not constitute any legal or other advice and does not constitute a recommendation that stockholders exercise their appraisal rights under Section 262. All references in Section 262 and in this summary to a “stockholder” are to the record holder of shares of common stock unless otherwise expressly noted herein. Only a holder of record of shares of common stock is entitled to demand appraisal of the shares registered in that holder’s name. A person having a beneficial interest in shares of common stock held of record in the name of another person, such as a bank, broker, trust or other nominee, must act promptly to cause the record holder to follow the steps summarized below properly and in a timely manner to perfect appraisal rights. If you hold your shares of our common stock through a bank, broker or other nominee and you wish to exercise appraisal rights, you should consult with your bank, broker or the other nominee.

Under Section 262, if the merger is completed, holders of shares of common stock who: (1) submit a written demand for appraisal of their shares, (2) do not vote in favor of the adoption of the merger agreement; (3) continuously are the record holders of such shares through the effective time; and (4) otherwise exactly follow the procedures set forth in Section 262 may be entitled to have their shares appraised by the Delaware Court of Chancery and to receive payment in cash of the “fair value” of the shares of common stock, exclusive of any element of value arising from the accomplishment or expectation of the merger, together with interest to be paid on the amount determined to be fair value, if any, as determined by the court. However, after an appraisal petition has been filed, the Delaware Court of Chancery will dismiss appraisal proceedings as to all stockholders who have asserted appraisal rights unless (a) the total number of shares for which appraisal rights have been pursued and perfected exceeds 1% of the outstanding shares of common stock as measured in accordance with subsection (g) of Section 262; or (b) the value of the aggregate per share merger consideration in respect of the shares of common stock for which appraisal rights have been pursued and perfected exceeds $1 million (conditions (a) and (b) referred to as the “ownership thresholds”). Unless the Delaware Court of Chancery, in its discretion, determines otherwise for good cause shown, interest on an appraisal award will accrue and compound quarterly from the effective time through the date the judgment is paid at 5% over the Federal Reserve discount rate (including any surcharge) as established from time to time during such period. However, at any time before the Delaware Court of Chancery enters judgment in the appraisal proceedings, the Surviving Corporation may voluntarily pay to each stockholder entitled to appraisal an amount in cash pursuant to subsection (h) of Section 262, in which case such interest will accrue after the time of such payment only on an amount that equals the difference, if any, between the amount so paid and the “fair value” of the shares as determined by the Delaware Court of Chancery, in addition to any interest accrued prior to the time of such voluntary cash payment, unless paid at such time. The Surviving Corporation is under no obligation to make such voluntary cash payment prior to such entry of judgment.

Under Section 262, where a merger agreement is to be submitted for adoption at a meeting of stockholders, the corporation, not less than 20 days prior to the meeting, must notify each of its stockholders who was such on the record date for notice of such meeting with respect to shares for which appraisal rights are available that appraisal rights are available and include in the notice a copy of Section 262. This proxy statement constitutes CASMED’s notice to stockholders that appraisal rights are available in connection with the merger, and the full text of Section 262 is attached to this proxy statement as Annex D. In connection with the merger, any holder of shares of common stock who wishes to exercise appraisal rights, or who wishes to preserve such holder’s right to do so, should review Annex D carefully. Failure to strictly comply with the requirements of Section 262 in a timely and proper manner may result in the loss of appraisal rights under the DGCL. A stockholder who fails to timely and properly assert his, her or its appraisal rights (or who, as more fully discussed below, timely withdraws any demand for appraisal)

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will be entitled to receive the merger consideration described in the merger agreement. Moreover, because of the complexity of the procedures for exercising the right to seek appraisal of shares of common stock, CASMED believes that if a stockholder considers exercising such rights, that stockholder should seek the advice of legal counsel.

Stockholders wishing to exercise the right to seek an appraisal of their shares of common stock must do ALL of the following:

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the stockholder must not vote in favor of the proposal to adopt the merger agreement;

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the stockholder must deliver to CASMED a written demand for appraisal before the vote on the merger agreement at the special meeting;

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the stockholder must continuously hold the shares from the date of making the demand through the effective time (a stockholder will lose appraisal rights if the stockholder transfers the shares before the effective time); and

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the stockholder (or any person who is the beneficial owner of shares of common stock held either in a voting trust or by a nominee on behalf of such person) or the Surviving Corporation must file a petition in the Delaware Court of Chancery requesting a determination of the fair value of the shares within 120 days after the effective time. The Surviving Corporation is under no obligation to file any petition and has no intention of doing so.

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In addition, one of the ownership thresholds described above must be met.

Because a proxy that does not contain voting instructions will, unless revoked, be voted in favor of the adoption of the merger agreement, a stockholder who votes by proxy and who wishes to exercise appraisal rights must affirmatively vote against the adoption of the merger agreement, abstain or not vote its shares.

Filing Written Demand

Any holder of shares of common stock wishing to exercise appraisal rights must deliver to CASMED, before the vote on the adoption of the merger agreement at the special meeting at which the proposal to adopt the merger agreement will be submitted to stockholders, a written demand for the appraisal of the stockholder’s shares, and that stockholder must not vote or submit a proxy in favor of the adoption of the merger agreement. A holder of shares of common stock exercising appraisal rights must hold of record the shares on the date the written demand for appraisal is made and must continue to hold the shares of record through the effective time. A proxy that is submitted and does not contain voting instructions will, unless revoked, be voted in favor of the adoption of the merger agreement, and it will constitute a waiver of the stockholder’s right of appraisal and will nullify any previously delivered written demand for appraisal. Therefore, a stockholder who submits a proxy and who wishes to exercise appraisal rights must submit a proxy containing instructions to vote against the adoption of the merger agreement or abstain from voting, or otherwise fail to vote, on the adoption of the merger agreement. Neither voting against the adoption of the merger agreement (whether by proxy or otherwise) nor abstaining from voting or failing to vote on the proposal to adopt the merger agreement will, in and of itself, constitute a written demand for appraisal satisfying the requirements of Section 262. The written demand for appraisal must be in addition to and separate from any proxy or vote on the adoption of the merger agreement and a proxy or vote against the adoption of the merger agreement will not constitute a written demand. A stockholder’s failure to make the written demand prior to the taking of the vote on the adoption of the merger agreement at the Special Meeting of CASMED stockholders will constitute a waiver of appraisal rights.

Only a holder of record of shares of common stock is entitled to demand appraisal rights for the shares registered in that holder’s name. A demand for appraisal in respect of shares of common stock must be executed by or on behalf of the holder of record, and must reasonably inform CASMED of the identity of the holder and state that the person intends thereby to demand appraisal of the holder’s shares in connection with the merger. If the shares are owned of record in a fiduciary or representative capacity, such as by a trustee, guardian or custodian, such demand must be executed by or on behalf of the record owner, and if the shares are owned of record by more than one person, as in a joint tenancy and tenancy in common, the demand must be executed by or on behalf of all joint owners. An authorized agent, including

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an authorized agent for two or more joint owners, may execute a demand for appraisal on behalf of a holder of record; however, the agent must identify the record owner or owners and expressly disclose that, in executing the demand, the agent is acting as agent for the record owner or owners.

STOCKHOLDERS WHO HOLD THEIR SHARES IN BROKERAGE OR BANK ACCOUNTS OR OTHER NOMINEE FORMS AND WHO WISH TO EXERCISE APPRAISAL RIGHTS SHOULD CONSULT WITH THEIR BANK, BROKER OR OTHER NOMINEES, AS APPLICABLE, TO DETERMINE THE APPROPRIATE PROCEDURES FOR THE BANK, BROKER OR OTHER NOMINEE TO MAKE A DEMAND FOR APPRAISAL OF THOSE SHARES. A PERSON HAVING A BENEFICIAL INTEREST IN SHARES HELD OF RECORD IN THE NAME OF ANOTHER PERSON, SUCH AS A BANK, BROKER OR OTHER NOMINEE, MUST ACT PROMPTLY TO CAUSE THE RECORD HOLDER TO FOLLOW PROPERLY AND IN A TIMELY MANNER THE STEPS NECESSARY TO PERFECT APPRAISAL RIGHTS.

All written demands for appraisal pursuant to Section 262 should be mailed or delivered to:

CAS Medical Systems, Inc.
44 East Industrial Road
Branford, Connecticut 06405
Attention: Secretary

Any holder of shares of common stock who has delivered a written demand to CASMED and who has not commenced an appraisal proceeding or joined that proceeding as a named party may withdraw his, her or its demand for appraisal and accept the consideration offered pursuant to the merger agreement by delivering to CASMED a written withdrawal of the demand for appraisal. However, any such attempt to withdraw the demand made more than 60 days after the effective time will require written approval of the Surviving Corporation. No appraisal proceeding in the Delaware Court of Chancery will be dismissed as to any stockholder without the approval of the Delaware Court of Chancery, and such approval may be conditioned upon such terms as the Delaware Court of Chancery deems just; provided, however, that this shall not affect the right of any stockholder who has not commenced an appraisal proceeding or joined that proceeding as a named party to withdraw such stockholder’s demand for appraisal and to accept the per share merger consideration within 60 days after the effective time. If an appraisal proceeding is commenced and CASMED, as the Surviving Corporation, does not approve a request to withdraw a demand for appraisal when that approval is required, or, except with respect to any stockholder who withdraws such stockholder’s demand in accordance with the proviso in the immediately preceding sentence, if the Delaware Court of Chancery does not approve the dismissal of an appraisal proceeding with respect to a stockholder, the stockholder will be entitled to receive only the appraised value determined in any such appraisal proceeding, which value could be less than, equal to or more than the per share merger consideration being offered pursuant to the merger agreement.

Notice by the Surviving Corporation

If the merger is completed, within 10 days after the effective time, the Surviving Corporation will notify each holder of shares of common stock who has properly made a written demand for appraisal pursuant to Section 262, and who has not voted in favor of the adoption of the merger agreement, that the merger has become effective and the effective date thereof.

Filing a Petition for Appraisal

Within 120 days after the effective time, but not thereafter, the Surviving Corporation or any holder of shares of common stock who has complied with Section 262 and is entitled to seek appraisal under Section 262 (including for this purpose any beneficial owner of the relevant shares) may commence an appraisal proceeding by filing a petition in the Delaware Court of Chancery, with a copy served on the Surviving Corporation in the case of a petition filed by a stockholder (or beneficial owner), demanding a determination of the fair value of the shares held by all dissenting stockholders entitled to appraisal. The Surviving Corporation is under no obligation, and has no present intention, to file a petition, and stockholders should not assume that the Surviving Corporation will file a petition or initiate any negotiations with respect to the fair value of the shares of common stock. Accordingly, any holders of

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shares of common stock who desire to have their shares appraised should initiate all necessary action to perfect their appraisal rights in respect of their shares of common stock within the time and in the manner prescribed in Section 262. The failure of a holder of common stock to file such a petition within the period specified in Section 262 could nullify the stockholder’s previous written demand for appraisal.

Within 120 days after the effective time, any holder of shares of common stock who has complied with the requirements of Section 262 and who is entitled to appraisal rights thereunder will be entitled, upon written request, to receive from the Surviving Corporation a statement setting forth the aggregate number of shares not voted in favor of the adoption of the merger agreement and with respect to which CASMED has received demands for appraisal, and the aggregate number of holders of such shares. The Surviving Corporation must mail this statement to the requesting stockholder within 10 days after receipt by the Surviving Corporation of the written request for such a statement or within 10 days after the expiration of the period for delivery of demands for appraisal, whichever is later. A beneficial owner of shares of common stock held either in a voting trust or by a nominee on behalf of such person may, in such person’s own name, file a petition seeking appraisal or request from the Surviving Corporation the foregoing statements. As noted above, however, the demand for appraisal can only be made by a stockholder of record.

If a petition for an appraisal is duly filed by a holder of shares of common stock and a copy thereof is served upon the Surviving Corporation, the Surviving Corporation will then be obligated within 20 days after such service to file with the Delaware Register in Chancery a duly verified list containing the names and addresses of all stockholders who have demanded payment for their shares and with whom agreements as to the value of their shares have not been reached. Upon the filing of any such petition, the Delaware Court of Chancery may order that notice of the time and place fixed for the hearing on the petition be mailed to the Surviving Corporation and all of the stockholders shown on the written statement described above at the addresses stated therein. Such notice will also be published at least one week before the day of the hearing in a newspaper of general circulation published in the City of Wilmington, Delaware, or in another publication determined by the Court. The costs of these notices are borne by the Surviving Corporation. After notice to stockholders as required by the court, the Delaware Court of Chancery is empowered to conduct a hearing on the petition to determine those stockholders who have complied with Section 262 and who have become entitled to appraisal rights thereunder. The Delaware Court of Chancery may require the stockholders who demanded payment for their shares to submit their stock certificates (if any) to the Register in Chancery for notation thereon of the pendency of the appraisal proceedings and, if any stockholder fails to comply with the direction, the Delaware Court of Chancery may dismiss that stockholder from the proceedings. The Delaware Court of Chancery will dismiss appraisal proceedings as to all stockholders who have asserted appraisal rights if neither of the ownership thresholds is met.

Determination of Fair Value

After determining the holders of common stock entitled to appraisal and that at least one of the ownership thresholds described above has been satisfied as to stockholders seeking appraisal rights, the appraisal proceeding will be conducted in accordance with the rules of the Delaware Court of Chancery, including any rules specifically governing appraisal proceedings. Through such proceeding, the Delaware Court of Chancery will determine the “fair value” of the shares of common stock, exclusive of any element of value arising from the accomplishment or expectation of the merger, together with interest, if any, to be paid upon the amount determined to be the fair value. In determining fair value, the Delaware Court of Chancery will take into account all relevant factors. Unless the court in its discretion determines otherwise for good cause shown, interest from the effective time through the date of payment of the judgment will be compounded quarterly and will accrue at 5% over the Federal Reserve discount rate (including any surcharge) as established from time to time during the period between the effective time and the date of payment of the judgment. However, at any time before the Delaware Court of Chancery enters judgment in the appraisal proceedings, the Surviving Corporation may pay to each stockholder entitled to appraisal an amount in cash, in which case such interest will accrue after the time of such payment only on an amount that equals the difference, if any, between the amount so paid and the “fair value” of the shares as determined by the Delaware Court of Chancery, in addition to any interest accrued prior to the time of such voluntary payment, unless paid at such time.

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In Weinberger v. UOP, Inc., the Supreme Court of Delaware discussed the factors that could be considered in determining fair value in an appraisal proceeding, stating that “proof of value by any techniques or methods which are generally considered acceptable in the financial community and otherwise admissible in court” should be considered, and that “[f]air price obviously requires consideration of all relevant factors involving the value of a company.” The Delaware Supreme Court stated that, in making this determination of fair value, the court must consider market value, asset value, dividends, earnings prospects, the nature of the enterprise and any other facts that could be ascertained as of the date of the merger that throw any light on future prospects of the merged corporation. Section 262 provides that fair value is to be “exclusive of any element of value arising from the accomplishment or expectation of the merger.” In Cede & Co. v. Technicolor, Inc., the Delaware Supreme Court stated that such exclusion is a “narrow exclusion [that] does not encompass known elements of value,” but which rather applies only to the speculative elements of value arising from such accomplishment or expectation. In Weinberger, the Supreme Court of Delaware also stated that “elements of future value, including the nature of the enterprise, which are known or susceptible of proof as of the date of the merger and not the product of speculation, may be considered.” In addition, the Delaware courts have decided that the statutory appraisal remedy, depending on factual circumstances, may or may not be a dissenting stockholder’s exclusive remedy.

Stockholders considering seeking appraisal should be aware that the fair value of their shares as so determined by the Delaware Court of Chancery could be more than, the same as or less than the consideration they would receive pursuant to the merger if they did not seek appraisal of their shares and that an opinion of an investment banking firm as to the fairness from a financial point of view of the consideration payable in a merger is not an opinion as to, and does not in any manner address, fair value under Section 262. No representation is made as to the outcome of the appraisal of fair value as determined by the Delaware Court of Chancery, and stockholders should recognize that such an appraisal could result in a determination of a value higher or lower than, or the same as, the per share merger consideration. Neither CASMED nor Parent anticipates offering more than the per share merger consideration to any stockholder exercising appraisal rights, and each of CASMED and Parent reserves the rights to make a voluntary cash payment pursuant to subsection (h) of Section 262 and to assert, in any appraisal proceeding, that for purposes of Section 262, the “fair value” of a share of common stock is less than the per share merger consideration. If a petition for appraisal is not timely filed, or if neither of the ownership thresholds described above has been satisfied as to stockholders seeking appraisal rights, then the right to an appraisal will cease. The costs of the appraisal proceedings (which do not include attorneys’ fees or the fees and expenses of experts) may be determined by the Delaware Court of Chancery and charged upon the parties as the Delaware Court of Chancery deems equitable under the circumstances. Upon application of a stockholder, the Delaware Court of Chancery may also order that all or a portion of the expenses incurred by a stockholder in connection with an appraisal proceeding, including, without limitation, reasonable attorneys’ fees and the fees and expenses of experts, be charged pro rata against the value of all the shares entitled to be appraised. In the absence of such determination or assessment, each party bears its own expenses.

If any stockholder who demands appraisal of his, her or its shares of common stock under Section 262 fails to perfect, or effectively loses or withdraws, such holder’s right to appraisal, the stockholder’s shares of common stock will be deemed to have been converted at the effective time into the right to receive the per share merger consideration, without interest. A stockholder will fail to perfect, or effectively lose or withdraw, the holder’s right to appraisal if no petition for appraisal is filed within 120 days after the effective time, if neither of the ownership thresholds described above has been satisfied as to stockholders seeking appraisal rights or if the stockholder delivers to the Surviving Corporation a written withdrawal of the holder’s demand for appraisal and an acceptance of the per share merger consideration in accordance with Section 262.

From and after the effective time, no stockholder who has demanded appraisal rights will be entitled to vote such shares of common stock for any purpose or to receive payment of dividends or other distributions on the stock, except dividends or other distributions on the holder’s shares of common stock, if any, payable to stockholders as of a time prior to the effective time. If no petition for an appraisal is filed, if neither of the ownership thresholds described above has been satisfied as to the stockholders seeking appraisal rights, or if the stockholder delivers to the Surviving Corporation a written withdrawal of the demand for an appraisal and an acceptance of the merger, either within 60 days after the effective time or

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thereafter with the written approval of the Surviving Corporation, then the right of such stockholder to an appraisal will cease. Once a petition for appraisal is filed with the Delaware Court of Chancery, however, the appraisal proceeding may not be dismissed as to any stockholder without the approval of the court, and such approval may be conditioned upon such terms as the Court deems just; provided, however, that the foregoing shall not affect the right of any stockholder who has not commenced an appraisal proceeding or joined that proceeding as a named party to withdraw such stockholder’s demand for appraisal and to accept the terms offered upon the merger within 60 days after the effective time.

Failure to comply strictly with all of the procedures set forth in Section 262 may result in the loss of a stockholder’s statutory appraisal rights. Consequently, any stockholder wishing to exercise appraisal rights is encouraged to consult legal counsel before attempting to exercise those rights.

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PROPOSAL 2
AUTHORITY TO ADJOURN THE SPECIAL MEETING

The Adjournment Proposal

If at the special meeting, our board of directors determines it is necessary to adjourn the special meeting, we intend to move to adjourn the special meeting. For example, our board of directors may make such a determination if the number of shares of CASMED stock represented and voting in favor of the proposal to adopt the merger agreement at the special meeting is insufficient to adopt that proposal under the DGCL, in order to enable our board of directors to solicit additional votes in respect of such proposal. If our board of directors determines that it is necessary to adjourn the special meeting, we will ask our stockholders to vote only upon the proposal to adjourn the special meeting, and not the proposal to adopt the merger agreement.

In this proposal, we are asking you to authorize the holder of any proxy solicited by our board of directors to vote in favor of the proposal to adjourn the special meeting to another time and place. If the stockholders approve the proposal to adjourn the special meeting, we could adjourn the special meeting and any adjourned session of the special meeting and use the additional time to solicit additional votes, including the solicitation of votes from stockholders that have previously voted. Among other things, approval of the proposal to adjourn the special meeting could mean that, even if we had received proxies representing a sufficient number of votes against the proposal to adopt the merger agreement to defeat that proposal, we could adjourn the special meeting without a vote on the merger agreement and seek to convince the holders of those shares to change their votes to votes in favor of the proposal to adopt the merger agreement.

Board of Directors Recommendation

Our board of directors unanimously recommends that you vote “FOR” the proposal to adjourn the special meeting.

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PROPOSAL 3
ADVISORY VOTE REGARDING GOLDEN PARACHUTE COMPENSATION

Advisory Vote Regarding Golden Parachute Compensation

The information set forth in the table below is intended to comply with Item 402(t) of Regulation S-K under the Exchange Act, which requires disclosure of information about compensation for each “named executive officer” of CASMED that is based on or otherwise relates to the merger. The compensation described below is referred to as “golden parachute compensation.” Further details regarding the following forms of golden parachute compensation payable in connection with the merger can be found at “Proposal 1: Adoption of the Merger Agreement — Interests of Certain Persons in the Merger,” and the table below.

Section 951 of the Dodd-Frank Act and Rule 14a-21(c) under the Exchange Act require that we seek a non-binding advisory vote from our stockholders to approve the golden parachute compensation payable to our named executive officers in connection with the merger. We are asking our stockholders to approve, on an advisory basis, the golden parachute compensation payable to our named executive officers in connection with the merger.

Severance Payments and Benefits

CASMED and Messrs. Patton, Baird and Gamelin are parties to employment agreements, which provide for certain severance payments and benefits in connection with a qualifying termination of employment following the proposed merger. The employment agreements also provide that each of the executives will be subject to certain non-competition and non-solicitation restrictions for one (1) year following termination of employment. If the executive were to violate such restrictions during the severance period, then such executive would forfeit any remaining severance payments. For a description of the employment agreements, see “Employment Agreements” beginning on page 51 of this proxy statement.

Assuming that the merger occurs on April 30, 2019 and an involuntary termination occurs immediately thereafter, as described further below, Messrs. Patton, Baird and Gamelin will also be eligible to receive a pro rata portion of their annual bonus under CASMED’s 2019 management bonus program based on target level performance.

None of the named executive officers will receive a tax gross-up in connection with the merger.

Equity Awards

Stock Options

As of the effective time of the merger, assuming the consent of each option holder is obtained, all options to acquire shares of CASMED common stock that are outstanding and unexercised (whether vested or unvested) will be cancelled and converted into a right to receive (i) as to those options with an exercise price that is equal to or less than $2.45 per share, the product of  (x) the excess of  $2.45 over the exercise price per share of the applicable option, and (y) the number of shares subject to the applicable option, less any applicable withholding taxes. Messrs. Patton, Baird and Gamelin have agreed to cancel any options with an exercise price that exceeds $2.45 per share, without payment of additional consideration.

Restricted Stock Awards

As of the effective time of the merger, each award of CASMED common stock that is subject to vesting conditions (each referred to in this proxy statement as a restricted stock award) will be vested, and each holder of a restricted stock award will have the right to receive an amount in cash equal to (x) the number of shares of CASMED common stock subject to such restricted stock award, multiplied by (y) $2.45, less any applicable withholding taxes.

Notwithstanding the foregoing, 150,000 shares of restricted stock subject to performance-based vesting conditions underlying an Inducement Restricted Stock Agreement made as of August 27, 2010 by and between CASMED and Thomas M. Patton, will be cancelled, with no further consideration due to Mr. Patton.

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Supplemental Transaction Bonus

Messrs. Patton, Baird and Gamelin are eligible to receive a supplemental transaction bonus, pursuant to which each executive will be eligible for a lump sum cash transaction bonus payment upon closing of the proposed merger. In order to be eligible for the transaction bonus, each executive generally must remain employed through the proposed merger.

Estimated Payments and Benefits

The table below sets forth an estimate of the approximate values of golden parachute compensation that may become payable to our named executive officers in connection with the merger, as described herein and under the heading “Proposal 1: Adoption of the Merger Agreement — Interests of Certain Persons in the Merger.” The footnotes to the table below distinguish between the benefits available in connection with the merger without a qualifying termination (“single-trigger” benefits) and the benefits payable upon a qualifying termination of employment in connection with the merger (“double-trigger” benefits). In accordance with SEC rules, the table assumes the closing of the merger occurs on April 30, 2019, and the employment of our named executive officers is terminated without cause immediately following the closing on April 30, 2019. If the merger were to close, and the associated terminations of employment were to occur, on a date other than April 30, 2019, certain amounts paid to the named executive officers may be higher or lower than the amounts shown in the table. The information below is based on the merger consideration of  $2.45 per share.

(1)

Cash.   Represents the aggregate amount of double-trigger cash severance payments to be paid by CASMED (or the surviving corporation in the merger) following a qualifying termination of employment within two years (in the case of Messrs. Patton and Baird) or six (6) months (in the case of Mr. Gamelin) following a change in control of CASMED in an amount equal to the executive’s annual base salary (in the case of Messrs. Patton and Baird) or one half of the executive’s annual base salary (in the case of Mr. Gamelin), payable over a period of one (1) year after termination. Additionally, each of the executives would be eligible to receive a pro-rata portion of the executive’s target bonus under the 2019 management bonus plan. The 2019 management bonus payment assumes 100% achievement of applicable targets and would be payable in 2020 consistent with Edwards’ bonus payment schedule (but in no event later than March 15, 2020). The amount for each executive officer represents the following amounts: Mr. Patton: $358,225 for base salary continuation and $59,704 representing the pro rata portion of the 2019 management bonus; Mr. Baird: $248,992 for base salary continuation and $24,899 representing the pro rata portion of the 2019 management bonus; Mr. Gamelin: $112,940 for base salary continuation and $22,588 representing the pro rata portion of the 2019 management bonus.

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(2)

Equity.   Represents the single-trigger cash lump sum payment that will result from the acceleration of unvested options and restricted stock awards upon the completion of the merger.

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The amount for each named executive officer represents the following amounts: Mr. Patton: $80,100 for unvested options and $532,875 for restricted stock awards; Mr. Baird: $26,700 for unvested options and $254,188 for restricted stock awards; Mr. Gamelin: $26,700 for unvested options and $254,188 for restricted stock awards. It does not include 150,000 restricted stock awards subject to performance-based vesting conditions underlying an Inducement Restricted Stock Agreement made as of August 27, 2010 by and between CASMED and Thomas M. Patton, which will be cancelled, with no further consideration due to Mr. Patton.

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The payment is determined on a pre-tax basis based on the number of shares underlying awards held as of January 31, 2019, multiplied by $2.45 per share over the exercise price of the award (with respect to options) and $2.45 per share (in the case of restricted stock awards). For the total payments payable in respect of all stock options and restricted stock awards, see “Proposal 1: Adoption of the Merger Agreement — Interests of Certain Persons in the Merger.”

(3)

Pension/Non-Qualified Deferred Compensation.   None of the named executive officers will receive any pension or non-qualified deferred compensation benefits in connection with the merger.

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(4)

Perquisites/Benefits.   Represents the value of the company payment toward continued medical coverage under COBRA at the active employee rate for the twelve (12) month period following termination of employment pursuant to their employment agreements. These benefits are double-trigger.

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(5)

Tax Reimbursement.   None of the named executive officers will receive a tax gross-up in connection with the merger.

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(6)

Other.   Represents the amount of a single-trigger cash lump sum transaction bonus to be paid by CASMED (or the surviving corporation in the merger) upon closing of the merger.

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(7)

Total.   The following table shows, for each named executive officer, the amounts of golden parachute compensation that are single-trigger or double-trigger in nature, as the case may be. Single-trigger amounts include the amounts shown in the “Equity” and “Other” columns of the table above. Double-trigger amounts include the amounts shown in the “Cash” and “Perquisites/Benefits” columns. The total amounts do not reflect any reductions which may be made to payments which constitute “parachute payments” under the Code.

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Section 951 of the Dodd-Frank Act and Rule 14a-21(c) under the Exchange Act require that we seek a non-binding advisory vote from our stockholders to approve the golden parachute compensation payable to our named executive officers in connection with the merger. Accordingly, we are asking you to approve the following resolution:

“RESOLVED, that the stockholders approve, on an advisory (non-binding) basis, the agreements or understandings with and items of compensation payable to the named executive officers of CASMED that are based on or otherwise relate to the merger, as disclosed in the section of the Proxy Statement entitled “Proposal 3: Advisory Vote Regarding Golden Parachute Compensation.”

Board of Directors Recommendation

Our board of directors unanimously recommends that you vote “FOR” approval of the non-binding advisory proposal on the golden parachute compensation payable to our named executive officers in connection with the merger.

Approval of the “golden parachute compensation” proposal is not a condition to the completion of the merger. The vote with respect to the “golden parachute compensation” proposal is an advisory vote and will not be binding on us or Edwards. Further, the underlying plans and arrangements are contractual in nature and not, by their terms, subject to stockholder approval. Accordingly, regardless of the outcome of the non-binding advisory vote, if the merger agreement is adopted by the stockholders and completed, our named executive officers will receive the “golden parachute compensation” to which they may be entitled.

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS, DIRECTORS
AND EXECUTIVE OFFICERS

Ownership of CASMED Common Stock by Certain Beneficial Owners

The following table sets forth certain information known to CASMED regarding the beneficial ownership of CASMED common stock as of February 15, 2019, except as specified below, by: (i) CASMED’s Chief Executive Officer and each of the next two most highly compensated executive officers for the year ended December 31, 2018 (referred to in this proxy statement as the named executive officers); (ii) each director of CASMED; (iii) each person known by CASMED to own beneficially more than five percent (5%) of the outstanding CASMED common stock; and (iv) all current directors and executive officers of the Company as a group. Except as otherwise indicated, (i) all shares are owned directly; and (ii) subject to community property laws where applicable, the persons named in the table have sole voting and investment power with respect to all shares of CASMED common stock shown as beneficially owned by them, other than restricted shares (over which they have sole voting power but no investment power). Unless otherwise noted below, the address for all stockholders is c/o CAS Medical Systems, Inc., 44 East Industrial Road, Branford, Connecticut 06405.

In general, “beneficial ownership” means the sole or shared power to vote, or to direct the voting of, a security, or the sole or shared investment power with respect to a security (i.e., the power to dispose of, or to direct the disposition of, a security). In addition, under SEC rules, a person is deemed, as of any date, to have “beneficial ownership” of any security that such person has the right to acquire within 60 days after such date. The number of shares beneficially owned by each stockholder is determined according to the rules of the SEC, and the information is not necessarily indicative of beneficial ownership for any other purpose. Under current rules, beneficial ownership includes any shares as to which the individual or entity has sole or shared voting power or investment power. As a consequence, several persons may be deemed to be the “beneficial owners” of the same shares.

On February 11, 2019, in connection with the execution of the merger agreement, Edwards entered into separate voting agreements with each of the holders of our Series A Convertible Preferred Stock and Series A Exchangeable Preferred Stock (Thomas, McNerney & Partners, L.P., TMP Nominee II, L.L.C., and TMP Associates II, L.P.), each of the Company’s executive officers (Thomas M. Patton, Jeffery A. Baird, John K. Gamelin and Paul B. Benni), and each of the Company’s non-employee directors (Alan W. Milinazzo, Paul A. Molloy, Gregory P. Rainey, James E. Thomas, Kathleen A. Tune and Kenneth R. Weisshaar), pursuant to which, among other matters, they agreed: (1) to vote the shares of CASMED stock held by each of them in favor of the adoption of the merger agreement and the approval of the merger, and to vote against any alternate proposal, (2) not to undertake certain activities related to solicitation of a Company Acquisition Proposal (as defined in the merger agreement), (3) not to transfer their shares of CASMED stock prior to the consummation of the merger, subject to limited exceptions, (4) to waive their appraisal rights under Delaware law, (5) to cancel all of their out of the money stock options, and in the case of Mr. Patton, a performance restricted stock grant, immediately prior to the closing of the merger, and (6) with respect to the holders of the CASMED preferred stock, to convert their CASMED preferred stock into CASMED common stock prior to the merger.

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*

Less than one percent of the class

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(a)

Based upon information set forth in a Form 4 filed with the SEC on February 13, 2015, by Thomas McNerney & Partners II, L.P. (“TMP II LP”); TMP Nominee II, LLC (“TMPN”); TMP Associates II, L.P. (“TMPA”); and Thomas, McNerney & Partners II, LLC (“TMP II LLC”). Also based upon information set forth in a Schedule 13D/A Amendment No. 3 filed with the SEC on February 13, 2019, by TMP II LP, TMPN, TMPA, TMP II LLC, and Mr. James Thomas, and other data available to CASMED. TMP II LP, TMPN, and TMPA hold, respectively, 94,182; 984; and 334 shares of Series A Convertible Preferred Stock (which represent in the aggregate 100% of the outstanding Series A Convertible Preferred Stock) and 53,748; 561; and 191 shares of Series A Exchangeable Preferred Stock (which represent in the aggregate 100% of the outstanding Series A Exchangeable Preferred Stock). The shares in the table above, with respect to common stock, include “common stock equivalent” rights on shares of Series A Convertible Preferred Stock and Series A Exchangeable Preferred Stock. Each share of Series A Convertible Preferred Stock and Series A Exchangeable Preferred Stock has “common stock equivalent” rights as of February 11, 2019, equal to approximately 71.5 shares of common stock, which is determined by dividing the stated value of  $100 per share of Series A Convertible Preferred Stock and Series A Exchangeable Preferred Stock plus accretion by an effective conversion price of  $2.389 per share. Of the 10,721,871 common stock equivalent rights in the table above (i) 10,573,909 are deemed owned directly by TMP II LP, (ii) 110,436 are owned directly by TMPN, and (iii) 37,526 are directly owned by TMPA. Data reflects accretion of dividends as of February 11, 2019. TMP II LLC, the general partner of TMP II LP and TMPA, has shared voting and dispositive power over the shares held by TMP II LP and TMPA. In addition, TMPN has entered into an agreement with TMP II LLC that directs TMPN to vote and dispose of securities in the same manner as directed by TMP II LLC with respect to the shares held by TMP II LP and TMPA. Mr. Thomas is the manager of TMPN and has voting and dispositive power over such securities, provided that they are obligated to exercise such power in the same manner as TMP II LLC votes and disposes of the securities of CASMED over which TMP II LLC exercises voting and dispositive power. Mr. Thomas is the manager of TMP II LLC. The persons and entities named in this footnote are referred to individually herein as a “Reporting Person” and collectively as the “Reporting Persons.” Amounts in the table above also include 63,454 shares of common stock and options to purchase 65,000 shares of common stock held by Mr. Thomas and 20,954 shares of common stock and options

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to purchase 65,000 shares of common stock held by Ms. Kathleen A. Tune, directors of CASMED, which shares and options are held in their respective names but are being held for the benefit of TMP II LP. Each Reporting Person disclaims beneficial ownership of the above-referenced shares other than to the extent of their pecuniary interest therein.

(b)

Based upon information set forth in a Schedule 13G filed with the SEC on February 14, 2019, by Acuta Capital Partners LLC. Acuta Capital Partners LLC holds sole voting and dispositive power over the indicated shares.

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(c)

Based upon information set forth in a Schedule 13D Amendment No. 3 filed with the SEC on January 4, 2017, by Norman H. Pessin, Sandra F. Pessin, and Brian Pessin. Norman H. Pessin holds sole voting and dispositive power over 1,395,777 of the indicated shares; Sandra F. Pessin holds sole voting and dispositive power over 708,487 of the indicated shares; and Brian Pessin holds sole voting and dispositive power over 420,546 of the indicated shares.

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(d)

Includes 367,500 shares of restricted common stock and 765,000 shares underlying options exercisable within 60 days held by Mr. Patton.

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(e)

Includes 22,500 shares of restricted common stock and 45,000 shares underlying options exercisable within 60 days held by Mr. Milinazzo.

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(f)

Includes 22,500 shares of restricted common stock and 45,000 shares underlying options exercisable within 60 days held by Mr. Molloy.

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(g)

Includes 22,500 shares of restricted common stock and 65,000 shares underlying options exercisable within 60 days held by Mr. Rainey.

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(h)

Includes 22,500 shares of restricted common stock and 65,000 shares underlying options exercisable within 60 days held by Mr. Thomas. Also includes, without duplication, shares referenced in footnote (a) above.

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(i)

Includes 22,500 shares of restricted common stock and 65,000 shares underlying options exercisable within 60 days by Ms. Tune.

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(j)

Includes 22,500 shares of restricted common stock and 65,000 shares underlying options exercisable within 60 days by Mr. Weisshaar.

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(k)

Includes 103,750 shares of restricted common stock and 210,000 shares underlying options exercisable within 60 days by Mr. Baird.

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(l)

Includes 103,750 shares of restricted common stock and 245,000 shares underlying options exercisable within 60 days by Mr. Gamelin.

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(m)

Includes 748,125 shares of restricted common stock and 1,750,000 shares underlying options exercisable within 60 days.

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MARKET PRICE OF CASMED COMMON STOCK AND DIVIDEND INFORMATION

CASMED common stock is traded on the NASDAQ Capital Market under the trading symbol “CASMED.” As of  [•], 2019, there were [•] shares of CASMED common stock outstanding held by approximately 142 stockholders of record. The actual number of stockholders is greater than this number of record holders and includes stockholders who are beneficial owners, but whose shares are held in street name by brokers and other nominees.

We have never paid cash dividends on CASMED common stock and have no current plans to do so. Under the terms of the merger agreement, between the signing of the merger agreement and the earlier of the closing of the merger and termination of the merger agreement, we are not permitted to pay any dividends.

The closing sale price of CASMED common stock on the NASDAQ Capital Market on February 11, 2019, the last trading day prior to announcement of the execution of the merger agreement, was $1.57 per share. On [•], 2019, which is the most recent practicable date prior to the date of this proxy statement, the closing sale price of CASMED common stock was $[•] per share. You are encouraged to obtain current market quotations for CASMED common stock.

FUTURE STOCKHOLDER PROPOSALS

If the merger is completed, we will have no public stockholders, and there will be no public participation in any of our future stockholder meetings. We intend to hold the 2019 Annual Meeting of Stockholders (referred to in this proxy statement as the 2019 Annual Meeting) only if the merger is not completed.

A stockholder wishing to submit a proposal for inclusion in the proxy statement and form of proxy for the 2019 Annual Meeting, in accordance with Rule 14a-8 under the Exchange Act, must have sent such proposal to the Company at its principal executive offices not later than December 27, 2018. Stockholder proposals submitted outside the process provided in Rule 14a-8 shall be considered untimely in accordance with Rule 14a-5(e) if made after March 11, 2019.

OTHER MATTERS

At this time, we know of no other matters to be submitted to our stockholders at the special meeting or any adjournment or postponement of the special meeting. If any other matters properly come before the special meeting or at any adjournment or postponement of the special meeting, it is the intention of the persons named in the enclosed proxy card to vote the shares they represent in accordance with their best judgment.

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WHERE YOU CAN FIND MORE INFORMATION

We file annual, quarterly and current reports, proxy statements and other information with the SEC. You may read and copy any document we file at the SEC’s public reference room located at 100 F Street, N.E., Room 1580, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference room. Our SEC filings are also available to the public at the SEC’s website at http://www.sec.gov. You also may obtain free copies of the documents we file with the SEC by going to the Investor Relations section of our website at www.CASMED.com. The information provided on our website is not part of this proxy statement, and therefore is not incorporated by reference.

Any person, including any beneficial owner, to whom this proxy statement is delivered may request copies of proxy statements and any of the documents incorporated by reference in this document or other information concerning us, without charge, by written or telephonic request directed to Investor Relations, CAS Medical Systems, Inc., 44 East Industrial Road, Branford, Connecticut 06405, telephone (203) 488-6056, or on our website at www.CASMED.com or from the SEC through the SEC’s website at http://www.sec.gov. Documents incorporated by reference are available without charge, excluding any exhibits to those documents unless the exhibit is specifically incorporated by reference into those documents.

Edwards has supplied all information pertaining to Edwards and Merger Sub in this proxy statement and we have supplied all information pertaining to us.

THIS PROXY STATEMENT DOES NOT CONSTITUTE THE SOLICITATION OF A PROXY IN ANY JURISDICTION TO OR FROM ANY PERSON TO WHOM OR FROM WHOM IT IS UNLAWFUL TO MAKE SUCH PROXY SOLICITATION IN THAT JURISDICTION. YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROXY STATEMENT TO VOTE YOUR SHARES AT THE SPECIAL MEETING. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION THAT IS DIFFERENT FROM WHAT IS CONTAINED IN THIS PROXY STATEMENT.

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INCORPORATION BY REFERENCE

The SEC allows us to incorporate by reference certain information into this proxy statement. This means that we can disclose important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is considered to be a part of this proxy statement, and later information that we file with the SEC will update and supersede that information. We incorporate by reference the documents listed below and any documents filed by us pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this proxy statement and prior to the date of the special meeting:

CAS Medical Systems, Inc. Filings:

•

Annual Report on Form 10-K for the fiscal year ended December 31, 2017

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•

Quarterly Reports on Form 10-Q for the quarters ended March 31, 2018, June 30, 2018 and September 30, 2018

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•

Current Reports on Form 8-K filed with the Securities and Exchange Commission on January 29, 2018, May 8, 2018, June 22, 2018 and February 12, 2019

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•

Proxy Statement filed with the Securities and Exchange Commission on April 26, 2018

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Notwithstanding the foregoing, information furnished under items 2.02 and 7.01 of any Current Report on Form 8-K, including the related exhibits, is not incorporated by reference in this proxy statement.

Any person, including any beneficial owner, to whom this proxy statement is delivered may request copies of reports, proxy statements or other information concerning us, without charge, as described in the section of this proxy statement entitled “Where You Can Find More Information.”

We have not authorized anyone to provide information that is different from what is contained in this proxy statement and, if given, such information must not be relied upon as having been authorized by us or any other person.

THIS PROXY STATEMENT IS DATED [•] , 2019. YOU SHOULD NOT ASSUME THAT THE INFORMATION CONTAINED IN THIS PROXY STATEMENT IS ACCURATE AS OF ANY DATE OTHER THAN THAT DATE OR SUCH OTHER DATE AS MAY BE SPECIFIED HEREIN, AND THE MAILING OF THIS PROXY STATEMENT TO STOCKHOLDERS DOES NOT CREATE ANY IMPLICATION TO THE CONTRARY.YOUR VOTE IS IMPORTANT. PLEASE VOTE TODAY.

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Annex A​

Execution Version​

AGREEMENT AND PLAN OF MERGER
by and among
EDWARDS LIFESCIENCES HOLDING, INC.,
CROWN MERGER SUB, INC.
and
CAS MEDICAL SYSTEMS, INC.,
Dated as of February 11, 2019

table of contents

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