SUMMARY OF THE PROXY STATEMENT

This summary highlights selected information from this proxy statement and may not contain all of the information that is important to you. To better understand the Proposed Transaction and the proposals to be considered at the annual meeting, you should read this entire proxy statement carefully, including the annexes. See also the section entitled “ Where You Can Find More Information ” beginning on page 132.

Parties to the Proposed Transaction

PLC

PLC Systems Inc., a Yukon Territory corporation, was formed in 1987. The Company manufactures and markets medical technology for the cardiac and vascular markets, including its RenalGuard® product, designed to reduce the potentially toxic effects that contrast media can have on the kidneys when it is administered to high-risk patients during certain medical imaging procedures.

The mailing address of our principal executive office is 459 Fortune Boulevard, Milford, Massachusetts 01757.

PLC Systems Acquisition Corporation 

PLC Systems Acquisition Corporation, a Delaware corporation, which we refer to as Merger Sub, is a wholly owned subsidiary formed by us in 2014 to consummate the Viveve Merger. In the Viveve Merger, Merger Sub will merge with and into Viveve, with Viveve surviving as our wholly-owned subsidiary, and Merger Sub will cease to exist.

Viveve

Viveve, Inc. is a Delaware corporation that was incorporated in 2005 by Jonathon Parmer, MD, an OBGYN physician, and Edward Knowlton, the holder of patents covering the use of RF energy to tighten tissue. Viveve designs, develops, manufactures and markets medical devices for the non-invasive treatment of vaginal introital laxity.

GCP IV LLC

GCP IV LLC is a Delaware limited liability company that is managed by Genesis Capital Advisors LLC, a New York based asset management firm. GCP is the holder of 95% the Company’s outstanding Debentures.

Structure of the Proposed Transaction (Page 44)

The Viveve Merger Agreement provides for the combination of the Company and Viveve through a merger of Merger Sub with and into Viveve, whereby Viveve will become a wholly-owned subsidiary of the Company, and the Company will issue the Viveve equity holders approximately 4,655,023 PLC Shares and the Cash Merger Consideration. The RenalGuard Spin-Off will be consummated immediately prior to the closing of the Viveve Merger and consists of the transfer of certain of our assets and liabilities and all of the outstanding shares of RenalGuard Solutions, Inc., our wholly-owned subsidiary which will own the RenalGuard business through its holdings of 100% of the outstanding equity in PLC Medical Systems, Inc. and PLC Systemas Medicos Internacionais, to GCP in exchange for the cancellation or transfer of all of our outstanding Debentures held by GCP and a release of liens on substantially all of our assets, whereby RenalGuard Solutions, Inc. will become a private company wholly-owned by GCP.

Organizational Structure

The following diagrams illustrate the structure of the Company before and after the closing of the Proposed Transaction and Offering.

Pre-Merger Organizational Chart:

Post-Merger Organizational Chart:

Total PLC Shares to be Issued in the Proposed Transaction (Page 50)

Pursuant to the Viveve Merger Agreement, upon the effectiveness of the Viveve Merger, all shares of capital stock (including common and preferred stock) of Viveve then outstanding, along with certain outstanding warrants and convertible notes, will be converted into the right to receive either PLC Shares (collectively referred to herein as the Closing Net Merger Shares) or the Cash Merger Consideration. The aggregate number of Closing Net Merger Shares to be issued at closing of the Viveve Merger is based on an exchange ratio of 0.0080497 of one PLC Share for every one share of Viveve held by accredited equity holders of Viveve. We currently expect that, at the closing, we will issue approximately 4,655,023 PLC Shares to the Viveve equity holders pursuant to the terms of the Viveve Merger Agreement.

Consideration for Viveve Merger and RenalGuard Spin-Off (Page 44)

Pursuant to the terms of the RenalGuard Reorganization Agreement, all of PLC’s Debentures owned by GCP will be canceled or transferred, the related liens on substantially all of PLC’s assets will be released and all of the GCP Warrants will be canceled in exchange for all of the outstanding equity in RenalGuard Solutions, Inc.

Total PLC Shares Outstanding after the Proposed Transaction

Based on the number of PLC Shares outstanding as of August 11, 2014, and assuming completion of the Share Consolidation, the total number of PLC Shares outstanding after the closing of the Viveve Merger and all related transactions will be approximately 7,417,574, including 4,655,023 PLC Shares issued to former Viveve equity holders prior to the Offering. Based on these assumptions (and without giving effect to the Offering described below), current PLC shareholders and their designees will own approximately 37.2%, and the former equity holders of Viveve and their designees will own approximately 62.8% of the issued and outstanding PLC Shares, on a fully diluted basis. As contemplated by the Viveve Merger Agreement, immediately following the closing of the Proposed Transaction, PLC will complete the Offering for gross proceeds of $4,500,000 in cash payments and the conversion of up to approximately $1,500,000 outstanding amount of principal and interest of certain Viveve bridge notes. After the closing of the Offering, it is anticipated that the current PLC shareholders will own 14.7% of the issued and outstanding PLC Shares, the former equity holders of Viveve will own 24.9% of the issued and outstanding PLC Shares and the investors participating in Offering will own 60.4% of the issued and outstanding PLC Shares, based on 18,738,339 PLC Shares outstanding after the Offering.

Board of Directors of PLC following the Viveve Merger (Pages 53 and 109)

The Viveve Merger Agreement provides that effective immediately after the closing of the Viveve Merger, the Board of Directors of the Company will consist of five (5) directors, all of whom will be voted upon by our shareholders at the annual meeting. If all director nominees are elected, our Board will consist of one director who is the current Chairman of the board of Viveve and four current members of the board of directors of Viveve, one of whom is also the Chief Executive Officer of Viveve. See the sections entitled “ Proposal No. 5 — Election of Directors to the Board” and “Management After the Proposed Transaction ” beginning on pages 53 and 109 respectively, for additional information.

Accounting Treatment (Page 51)

Based on the terms of the Viveve Merger Agreement, Viveve is deemed to be the accounting acquirer because the former Viveve shareholders, board of directions and management will have voting and operating control of the Combined Company. The RenalGuard Spin-Off will occur prior to the Viveve Merger Agreement, resulting in Viveve merging with PLC’s public shell. The Viveve Merger will be accounted for as capital transaction accompanied by a recapitalization with no goodwill or other intangibles recorded.

Appraisal Rights (Page 131)

Our shareholders will have appraisal rights with respect to the RenalGuard Spin-Off, as a sale of all or substantially all of the Company’s assets, pursuant to Section 193 of the Yukon Business Corporations Act, provided you satisfy the annual criteria and conditions set forth in the Yukon Business Corporations Act. For more information on appraisal rights, see “ Appraisal Rights ” on page 131.

PLC’s Board of Directors’ Reasons for the Approval of the Proposed Transaction (Page 47)

Our Board of Directors considered a wide variety of factors in connection with its evaluation of the Proposed Transaction. In light of the complexity of those factors, our Board of Directors, as a whole, did not consider it practicable to, nor did it attempt to, quantify or otherwise assign relative weights to the specific factors it took into account in reaching its decision. Individual members of our Board of Directors may have given different weight to different factors.

In considering the Proposed Transaction, PLC’s Board of Directors considered the following factors, although not weighted or in any order of significance:

Quorum and Required Vote for Shareholder Proposals (Page 41)

Pursuant to our by-laws, two shareholders, or proxy holders representing two shareholders, holding not less than 10% of the outstanding shares of our common stock entitled to vote at the annual meeting, shall constitute a quorum with respect to that matter at the annual meeting. Shareholders of common stock present in person or represented by proxy (including shareholders who abstain or do not vote with respect to one or more of the matters presented for shareholder approval) will be counted for purposes of determining whether a quorum is present. “Broker non-votes,” which are shares that are held in “street name” by a bank or brokerage firm that indicates on its proxy that it does not have discretionary authority to vote on a particular matter, will not be counted for purposes of determining whether a quorum is present.

Pursuant to our by-laws, if within one-half hour from the time appointed for the annual meeting, a quorum is not present, the annual meeting shall be adjourned to the same day in the following week at the same time and place. If at such adjourned meeting a quorum is not present within one-half hour from the time appointed, the shareholders present in person or by proxy shall constitute a quorum. As of the Record Date for the annual meeting, 12,499,820 shares of our common stock would be required to achieve a quorum.

Recommendation to PLC Shareholders (Page 41)

Our Board of Directors believes that each of the Merger Proposal, the Spin-Off Proposal, the Name Change Proposal, the Board Declassification Proposal, the Director Election Proposal, the Incentive Plan Proposal, the Share Consolidation Proposal, the Auditor Proposal and the Adjournment Proposal to be presented at the annual meeting is in the best interests of the Company and our shareholders, and unanimously recommends that our shareholders vote “ FOR ” each of the proposals.

When you consider the recommendation of our Board of Directors in favor of approval of the Merger Proposal and Spin-Off Proposal, you should keep in mind that our directors and officers have interests in the Proposed Transaction that are different from, or in addition to, your interests as a shareholder. These interests include, among other things:

Risk Factors (Page 21)

In evaluating the proposals set forth in this proxy statement, you should carefully read this proxy statement, including the annexes, and annually consider the factors discussed in the section entitled “ Risk Factors ” beginning on page 21.

SELECTED FINANCIAL INFORMATION

Selected Historical Financial Information of PLC

The following table sets forth selected historical financial information derived from PLC’s unaudited condensed consolidated financial statements for the quarter ended March 31, 2014 included in our Quarterly Report on Form 10-Q for the three months ended March 31, 2014, and consolidated audited financial statements for the years ended December 31, 2013 and 2012 included in our Annual Report on Form 10-K for the year ended December 31, 2013 and incorporated herein by reference. Historical results are not necessarily indicative of results to be expected in any future period. You should read the following selected financial information in conjunction with the Company’s Management’s Discussion and Analysis of Financial Condition and Results of Operations and consolidated financial statements and the related notes appearing in our Quarterly Report for the period ended March 31, 2014 on Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, 2013 and incorporated herein by reference.

Selected Historical Financial Information of Viveve

The following table sets forth selected historical financial information derived from Viveve’s unaudited condensed financial statements included elsewhere in this proxy statement for the quarter ended March 31, 2014 and Viveve’s audited financial statements included elsewhere in this proxy statement for the years ended December 31, 2013 and 2012. Historical results are not necessarily indicative of results to be expected in any future period. You should read the following selected financial information in conjunction with the section entitled “ Viveve’s Management’s Discussion and Analysis of Financial Conditions and Results of Operations ” and Viveve’s financial statements and the related notes appearing elsewhere in this proxy statement.

Selected Unaudited Pro Forma Condensed Combined Financial Information

The following selected unaudited pro forma condensed combined financial data is intended to show how the Viveve Merger and RenalGuard Spin-Off and Offering might have affected historical financial statements if the transactions had been completed on January 1, 2013 for the purposes of the statements of operations and as of March 31, 2014 for the purposes of the balance sheet.  This information was prepared based on the historical financial results reported by PLC and Viveve. The following should be read in conjunction with the section entitled "Unaudited Pro Forma Combined Financial Statements" beginning on page 113, PLC's unaudited and audited historical financial statements and notes thereto included in PLC’s Quarterly Report on Form 10-Q, Annual Report on Form 10-K, and Viveve's unaudited and audited historical financial statements and the notes thereto beginning on page F-1.

Viveve is deemed to be the accounting acquirer because the former Viveve shareholders, board of directions and management will have voting and operating control of the Combined Company. The RenalGuard Spin-Off will occur prior to the Viveve Merger Agreement, resulting in Viveve merging with PLC’s public shell.  The merger will be accounted for as capital transaction accompanied by a recapitalization with no goodwill or other intangibles recorded. 

The unaudited pro forma condensed combined financial statements were prepared in accordance with the regulations of the Securities and Exchange Commission. The pro forma adjustments reflecting the completion of the Proposed Transaction and Offering are based upon the assumptions set forth in the notes to the unaudited pro forma condensed combined financial statements.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

We make forward-looking statements in this proxy statement. These forward-looking statements relate to outlooks or expectations for earnings, revenues, expenses or other future financial or business performance, strategies or expectations, or the impact of legal or regulatory matters on business, results of operations or financial condition. Specifically, forward-looking statements may include statements relating to:

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expansion plans and opportunities; and

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other statements preceded by, followed by or that include the words “estimate,” “plan,” “project,” “forecast,” “intend,” “expect,” “anticipate,” “believe,” “seek,” “target” or similar expressions.

These forward-looking statements are based on information available as of the date of this proxy statement, and current expectations, forecasts and assumptions, and involve a number of risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing PLC’s views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

You should not place undue reliance on these forward-looking statements in deciding how to grant your proxy or instruct how your vote should be cast or vote your shares on the proposals set forth in this proxy statement. As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include:

RISK FACTORS

In addition to the other information contained in this proxy statement, the following risks impact the business and operations of each of Viveve and PLC. These risk factors are not exhaustive and all investors are encouraged to perform their own investigation with respect to the business, financial condition and prospects of both Viveve and PLC.

Risks Related to Viveve’s Business

Viveve is dependent upon the success of its Viveve System, which has a limited commercial history. If the Viveve System fails to gain or loses market acceptance, Viveve’s business will suffer.

In 2012, Viveve began marketing its Viveve System in Canada, Hong Kong and Japan, and Viveve expects that sales of its Viveve System, including its single-use Viveve treatment tips, will account for substantially all of its revenue for the foreseeable future. Viveve’s Viveve System may not significantly penetrate current or new markets, including the U.S. and elsewhere. If demand for the Viveve System does not increase as Viveve anticipates, or declines, Viveve’s business, financial condition and results of operations will be harmed.

Performing clinical studies on, and collecting data from, the Viveve Treatment is inherently subjective, and Viveve has limited data regarding the efficacy of the Viveve System. If future data is not positive or consistent with Viveve’s prior experience, rates of physician adoption will likely be harmed.

Viveve believes that in order to significantly grow its business, it will need to conduct future clinical studies of the effectiveness of the Viveve System. Clinical studies of vaginal laxity and sexual function are subject to a number of limitations. First, these studies do not involve objective standards for measuring the effectiveness of treatment. Subjective, patient reported outcomes (PRO) are the most common method of evaluating effectiveness. As a result, clinical studies may conclude that a treatment is effective even in the absence of objective measures. Second, as with other non-invasive, energy-based devices, the effect of the Viveve Treatment varies from patient to patient and can be influenced by a number of factors, including the age, ethnicity and level of vaginal laxity and sexual function of the patient among other things.

Current published studies of the Viveve System, conducted in the U.S. and Japan have investigated the tissue-tightening effect of Viveve’s monopolar RF technology using single-arm studies, which were not randomized, blinded or controlled. Clinical studies designed in a randomized, blinded and controlled fashion represent the gold-standard in clinical trial design, which most effectively assess the efficacy of a product or therapy versus a placebo group. Future clinical studies, which may be required by Viveve to drive physician adoption or support regulatory clearance or approval, may require randomized, blinded and controlled trial designs. Since Viveve has not tested the Viveve procedure under these trial design conditions, Viveve cannot be certain that the outcomes will be positive, which would have a material impact on Viveve’s business.

Additionally, Viveve has not conducted any head-to-head clinical studies that compare results from treatment with the Viveve System to surgery or treatment with other therapies. Without head-to-head studies against competing alternative treatments, which Viveve has no current plans to conduct, potential customers may not find clinical studies of Viveve’s technology sufficiently compelling to purchase the Viveve System. If Viveve decides to pursue additional studies in the future, such studies could be expensive and time consuming, and the data collected may not produce favorable or compelling results. If the results of such studies do not meet physicians’ expectations, the Viveve System may not become widely adopted, physicians may recommend alternative treatments for their patients, and Viveve’s business may be harmed.

Viveve currently does not have the ability to market the Viveve System in the U.S. If Viveve wants to sell the Viveve System and single-use treatment tips in the U.S., it will need to obtain FDA clearance or approval, which may not be granted.

Developing and promoting the Viveve System in additional areas, including the U.S., is a key element of Viveve’s future growth strategy. Viveve currently does not have U.S. Food and Drug Administration, or FDA, clearance or approval in the U.S. to market the Viveve System for the non-invasive treatment of vaginal laxity or sexual dysfunction. Viveve is in the process of seeking, and intends to continue to seek, clearance or approval from the FDA to expand its marketing efforts. Viveve cannot predict whether it will receive such clearances or approvals. The FDA will require Viveve to conduct clinical trials to support regulatory clearance or approval, which trials may be time-consuming and expensive, and may produce results that do not result in clearance or approval of Viveve’s FDA application. In the event that Viveve does not obtain FDA clearance or approval, Viveve will be unable to promote the Viveve System in the U.S. and its ability to grow Viveve’s revenue may be adversely affected.

Viveve’s business is not currently profitable, and Viveve may not be able to achieve profitability even if it is able to generate significant revenue.

Through March 31, 2014, Viveve incurred losses since inception of approximately $30.7 million. In 2013, Viveve incurred a loss of $4.3 million and in 2012 a loss of $5.0 million. Despite increasing revenue, Viveve expects to incur significant additional losses in order to grow and expand its business. Viveve cannot predict if and when it will achieve profitability. Viveve’s failure to achieve and sustain profitability could negatively impact the market price of its common stock and may require it to seek additional financing for its business. There are no assurances that Viveve will be able to obtain any additional financing or that any such financing will be on terms that are favorable to Viveve. If Viveve fails to generate sufficient cash flows from operations, raise additional capital or reduce certain discretionary spending, it could have a material adverse effect on Viveve’s ability to achieve its intended business objectives. These factors raise substantial doubt about Viveve’s ability to continue as a going concern.

Viveve has received a qualified audit opinion on its ability to continue as a going concern.

The audit report issued by Viveve’s independent auditors on Viveve’s audited financial statements for the fiscal year ended December 31, 2013, contains a matter of emphasis regarding Viveve’s ability to continue as a going concern. This matter of emphasis indicates there is substantial doubt on the part of its auditors as to Viveve’s ability to continue as a going concern due to the risk that Viveve may not have sufficient cash and liquid assets as of December 31, 2013, to cover its operating capital requirements for the next twelve-month period and if sufficient cash cannot be obtained Viveve would have to substantially alter its operations, or it may be forced to discontinue operations. Such an opinion from the independent registered public accounting firm limits Viveve’s ability to access certain types of financing, or may prevent it from obtaining financing on acceptable terms. There can be no assurance that Viveve’s accounting firm will not qualify its opinion in the future.

It is difficult to forecast future performance, which may cause Viveve’s financial results to fluctuate unpredictably.

Viveve’s limited operating history makes it difficult to predict future performance. Additionally, the demand for the Viveve System may vary from quarter to quarter. A number of factors, over which Viveve has limited or no control, may contribute to fluctuations in its financial results, such as:

Viveve’s limited operating history has limited its ability to determine an appropriate sales price for its products.

Viveve’s historical operating performance has limited its ability to determine the proper sales prices for the Viveve System and Viveve’s single-use treatment tips. Establishing appropriate pricing for Viveve’s capital equipment and components has been challenging because there have not existed directly comparable competitive products. Viveve may experience similar pricing challenges in the future as it enters new markets or introduces new products, which could have an unanticipated negative impact on Viveve’s financial performance.

If there is not sufficient patient demand for Viveve treatments, practitioner demand for the Viveve System, including Viveve’s single-use treatment tips, sales could drop, resulting in unfavorable operating results.

Most procedures performed using the Viveve System are elective procedures, the cost of which must be borne by the patient, and are not reimbursable through government or private health insurance. The decision to undergo a Viveve Treatment is thus driven by consumer demand, which may be influenced by a number of factors, such as:

Viveve’s financial performance could be materially harmed in the event that any of the above factors discourage patients from seeking Viveve procedures.

Negative publicity regarding the Viveve Treatment could harm demand, which would adversely affect sales and Viveve’s financial performance.

Viveve expects that in the future it may experience negative media exposure. Such publicity may present negative individual physician or patient experience regarding the safety or effectiveness of the Viveve Treatment. Competitors could attempt to use such publicity to harm Viveve’s reputation and disrupt current or potential future customer relationships. While, to date, Viveve has not observed any negative publicity, future financial results could be negatively impacted. Additionally, while Viveve believes that obtaining positive publicity is important to its success, and it is an important component of Viveve’s marketing efforts, Viveve has also not yet observed a material impact on its financial results of operations from positive publicity.

Viveve’s reputation and competitive position may be harmed not only by negative media exposure, but also by other publicly-available information suggesting that the Viveve Treatment is not safe or effective. For example, Viveve expects that it will have to file adverse event reports, or Medical Device Reports (MDRs), with the FDA that are publicly available on the FDA’s website if its product may have caused or contributed to a serious injury or malfunctioned in a way that would likely cause or contribute to a serious injury if it were to occur. To date, there are no such MDRs on the FDA’s website related to the Viveve Treatment nor have any patients who have undergone the procedure, in either clinical trials or commercial use, experienced a device related serious adverse event. Despite this safety record, competitors may attempt to harm Viveve’s reputation by pointing to future adverse events that may be reported or publicized, or by claiming that their product is superior because they have not filed as many adverse event reports with the FDA. Such negative publicity and competitor behavior could harm Viveve’s reputation and future sales.

The failure of the Viveve System to meet patient expectations or the occurrence of unpleasant side effects from the Viveve Treatment could impair Viveve’s financial performance.

Viveve’s future success depends upon patients having a positive experience with the Viveve Treatment in order to increase physician demand for Viveve’s products, as a result of positive feedback and word-of-mouth referrals. Patients may be dissatisfied if their expectations of the procedure, side effects and results, among other things, are not met. Despite the safety of the Viveve Treatment, patients may experience undesirable side-effects such as temporary swelling or reddening of the treated tissue. Experiencing any of these side effects could discourage a patient from completing a Viveve Treatment or discourage a patient from having future procedures or referring Viveve Treatments to others. In order to generate referral business, Viveve also believes that patients must be satisfied with the effectiveness of the Viveve Treatment. Results obtained from a Viveve Treatment are subjective and may be subtle. The Viveve Treatment may produce results that may not meet patients’ expectations. If patients are not satisfied with the procedure or feel that it is too expensive for the results obtained, Viveve’s reputation and future sales will suffer.

Viveve’s success depends on growing physician adoption of the Viveve System and continued use of Viveve’s treatment tips.

Some of Viveve’s target physician customers already own self-pay device products. Viveve’s ability to grow its business and convince physicians to purchase the Viveve System depends on the success of Viveve’s sales and marketing efforts. Viveve’s business model involves both a capital equipment purchase of the Viveve System and continued purchases by Viveve’s customers of single-use treatment tips and ancillary consumables. This may be a novel business model for many potential customers who may be used to competing products that are either exclusively capital equipment, such as many laser-based systems. Viveve must be able to demonstrate that the cost of the Viveve System and the revenue that the physician can derive from performing procedures using Viveve’s product are compelling when compared to the cost and revenue associated with alternative products or therapies. When marketing to plastic surgeons, Viveve must also, in some cases, overcome a bias against non-invasive procedures. If Viveve is unable to increase physician adoption of the Viveve System and use of Viveve’s treatment tips, Viveve’s financial performance will be adversely affected.

To successfully market and sell the Viveve System internationally, Viveve must address many issues with which Viveve has limited experience.

International sales accounted for 100% of Viveve’s revenue in 2013 and 2012. Viveve believes that a significant portion of its business will continue to come from international sales through increased penetration in countries where Viveve currently sells the Viveve System, combined with expansion into new international markets. However, international sales are subject to a number of risks, including:

If one or more of these risks were realized, it could require Viveve to dedicate significant resources to remedy the situation, and even if Viveve is able to find a solution, Viveve’s revenue may still decline.

To market and sell the Viveve System internationally, Viveve depends on distributors, and they may not be successful.

Viveve currently depends exclusively on third-party distributors to sell and service the Viveve System internationally and to train Viveve’s international customers, and if these distributors terminate their relationships with Viveve or under-perform, Viveve may be unable to maintain or increase its level of international revenue. Viveve will also need to engage additional international distributors to grow its business and expand the territories in which it sells the Viveve System. Distributors may not commit the necessary resources to market, sell and service the Viveve System to the level of Viveve’s expectations. If current or future distributors do not perform adequately, or if Viveve is unable to engage distributors in particular geographic areas, Viveve’s revenue from international operations will be adversely affected.

Viveve currently has limited sales and marketing resources or experience and failure to build and manage a sales force or to market and distribute the Viveve System effectively could have a material adverse effect on Viveve’s business.

Viveve expects to rely on a direct sales force to sell the Viveve System in the U.S. In order to meet Viveve’s future anticipated sales objectives, Viveve expects to grow its domestic sales organization significantly over the next several years. There are significant risks involved in building and managing Viveve’s sales organization, including risks related to Viveve’s ability to:

In addition, the Viveve System competes with products that are well-established in the market. Accordingly, it is difficult to predict how well Viveve’s sales force will perform. Viveve’s failure to adequately address these risks could have a material adverse effect on its ability to sell the Viveve System, causing Viveve’s revenue to be lower than expected and harming Viveve’s results of operations.

Viveve competes against companies that have more established products, longer operating histories and greater resources, which may prevent Viveve from achieving significant market penetration or increased operating results.

The medical device and aesthetics markets are highly competitive and dynamic, and are marked by rapid and substantial technological development and product innovations. Demand for the Viveve System could be diminished by equivalent or superior products and technologies offered by competitors. Specifically, the Viveve System competes against other offerings in these markets, including laser and other light-based medical devices, pharmaceutical and consumer products, surgical procedures and exercise therapies.

Competing in these markets could result in price-cutting, reduced profit margins and loss of market share, any of which would harm Viveve’s business, financial condition and results of operations. Viveve’s ability to compete effectively depends upon its ability to distinguish its company and the Viveve System from Viveve’s competitors and their products, and on such factors as:

Some of Viveve’s competitors have more established products and customer relationships than Viveve, which could inhibit Viveve’s market penetration efforts. For example, Viveve may encounter situations where, due to pre-existing relationships, potential customers decided to purchase additional products from Viveve’s competitors. Potential customers also may need to recoup the cost of expensive products that they have already purchased from Viveve’s competitors and thus may decide not to purchase the Viveve System, or to delay such purchase. If Viveve is unable to achieve continued market penetration, Viveve will be unable to compete effectively and its business will be harmed.

In addition, some of Viveve’s current and potential competitors have significantly greater financial, research and development, manufacturing, and sales and marketing resources than Viveve. Viveve’s competitors could utilize their greater financial resources to acquire other companies to gain enhanced name recognition and market share, as well as new technologies or products that could effectively compete with Viveve’s existing product. Given the relatively few competitors currently in the market, any Proposed Transaction could exacerbate any existing competitive pressures, which could harm Viveve’s business.

Competition among providers of devices for the medical device and aesthetics markets is characterized by rapid innovation, and Viveve must continuously innovate the Viveve System and develop new products or Viveve’s revenue may decline.

While Viveve attempts to protect the Viveve System through patents and other intellectual property rights, there are few barriers to entry that would prevent new entrants or existing competitors from developing products that compete directly with Viveve’s products. For example, while Viveve believes its monopolar RF technology maintains a strong intellectual property position, there may be other companies employing competing technologies which claim to have a similar clinical effect to Viveve’s. Additionally, there are others who may market monopolar RF technology for competing purposes in a direct challenge to Viveve’s intellectual property position. As Viveve continues to create market demand for a non-surgical, non-invasive way to treat vaginal laxity and sexual dysfunction, competitors may enter the market with other products making similar or superior claims. Viveve expects that any competitive advantage it may enjoy from its current and future innovations may diminish over time, as companies successfully respond to Viveve’s innovations, or create their own. Consequently, Viveve believes that it will have to continuously innovate and improve the Viveve System and technology or develop new products to compete successfully. If Viveve is unable to develop new products or innovate successfully, the Viveve System could become obsolete and Viveve’s revenue will decline as Viveve’s customers purchase competing products.

Viveve outsources the manufacturing and repair of key elements of the Viveve System to a single manufacturing partner.

Viveve outsources the manufacture and repair of the Viveve System to a single contract manufacturer, Stellartech. If Stellartech’s operations are interrupted or if Stellartech is unable to meet Viveve’s delivery requirements due to capacity limitations or other constraints, Viveve may be limited in its ability to fulfill new customer orders or to repair equipment at current customer sites. Stellartech has limited manufacturing capacity, is itself dependent upon third-party suppliers and is dependent on trained technical labor to effectively repair Viveve’s system. In addition, Stellartech is a medical device manufacturer and is required to demonstrate and maintain compliance with the FDA’s Quality System Regulation, or QSR. If Stellartech fails to comply with the FDA’s QSR, its manufacturing and repair operations could be halted. In addition, both the availability of Viveve’s product to support the fulfillment of new customer orders as well as Viveve’s ability to repair those products installed at current customer sites would be impaired. In addition, as of the date of this Proxy Statement, the development and manufacturing agreement under which Viveve and Stellartech operate has expired without any subsequent extension or renewal by the parties and the minimum conditions to the licenses granted therein have not been satisfied by Viveve. Although the parties continue to operate under the terms of this agreement, Viveve’s manufacturing operations could be adversely impacted if Viveve is unable to enforce Stellartech’s performance under this agreement, or enter into a new agreement with Stellartech upon favorable terms.

Viveve’s manufacturing operations and those of its key manufacturing subcontractors are dependent upon third-party suppliers, making Viveve vulnerable to supply shortages and price fluctuations, which could harm Viveve’s business.

The single source supply of the Viveve System from Stellartech could not be replaced without significant effort and delay in production. Also, several other components and materials that comprise the Viveve System are currently manufactured by a single supplier or a limited number of suppliers. In many of these cases, Viveve has not yet qualified alternate suppliers and relies upon purchase orders, rather than long-term supply agreements. A supply interruption or an increase in demand beyond Viveve’s current suppliers’ capabilities could harm Viveve’s ability to manufacture the Viveve System until new sources of supply are identified and qualified. Viveve’s reliance on these suppliers subjects it to a number of risks that could harm its business, including:

Any interruption in the supply of components or materials, or Viveve’s inability to obtain substitute components or materials from alternate sources at acceptable prices in a timely manner, could impair Viveve’s ability to meet the demand of its customers, which would have an adverse effect on Viveve’s business.

If, in the future, Viveve decides to perform additional manufacturing functions internally that it currently outsources, Viveve’s business could be harmed by its limited manufacturing experience and related capabilities.

In the future, for financial or operational purposes, Viveve may elect to perform additional component or System manufacturing functions internally. Viveve’s limited experience with manufacturing processes could lead to difficulties in producing sufficient quantities of manufactured items that meet Viveve’s quality standards and that comply with applicable regulatory requirements in a timely and cost-effective manner. In addition, if Viveve experiences these types of manufacturing difficulties, it may be expensive and time consuming to engage a new or previous subcontractor or supplier to fulfill Viveve’s replacement manufacturing needs. The occurrence of any of these events could harm Viveve’s business.

If the Viveve System malfunctions or if Viveve discovers a manufacturing defect that could lead to a malfunction, Viveve may have to initiate a product recall or replace components, which could adversely impact Viveve’s business.

Problems in Viveve’s manufacturing processes, or those of Viveve’s manufacturing partners or subcontractors, which lead to an actual or possible malfunction in any of the components of the Viveve System, may require Viveve to recall product from customers or replace components and could disrupt Viveve’s operations. For example, in December 2012, Viveve began replacing handpiece assemblies that were causing system malfunctions due to fiber optic damage that occurred during the manufacturing process. Viveve subsequently worked with its manufacturing partner to redesign and test the reliability of the newly designed handpiece. The problem was resolved within several weeks and did not have a significant impact on Viveve’s ability to supply products to its customers or, more generally, on Viveve’s results of operations. However, Viveve’s results of operations, its reputation and market acceptance of its products could be harmed if Viveve encounters difficulties in manufacturing that result in a more significant issue or significant patient injury, and delays Viveve’s ability to fill customer orders.

Viveve may not be able to develop an alternative cooling module that will be in compliance with changing environmental regulations in a timely or cost-effective manner.

Viveve’s cooling module relies upon a hydroflurocarbon, or HFC, called R134a, to protect the outer layer of the tissue from over-heating while Viveve’s device delivers RF energy to the submucosal tissue. New environmental regulations phasing out HFCs over the next decade have been adopted or are under consideration in a number of countries, and recent European Union directives require the phase-out of HFCs and prohibit the introduction of new products incorporating HFCs beginning in 2007. If Viveve is unable to develop an alternative cooling module for its device which is not dependent on HFCs in a timely or cost-effective manner, the Viveve System may not be in compliance with environmental regulations, which could result in fines, civil penalties and the inability to sell Viveve’s products in certain major international markets.

In addition, the impending restrictions on HFCs have reduced their current availability, as suppliers have lower incentive to expand production capacity or maintain existing capacity. This change in supply could expose Viveve to supply shortages or increased prices for R134a, which could impair Viveve’s ability to manufacture the Viveve System and adversely affect Viveve’s results or operations. HFCs may also be classified by some countries as a hazardous substance and subject to significant shipping surcharges that may negatively impact profit margins.

Viveve forecasts sales to determine requirements for components and materials used in the Viveve System, and if Viveve’s forecasts are incorrect, Viveve may experience delays in shipments or increased inventory costs.

Viveve keeps limited materials, components and finished product on hand. To manage its manufacturing operations with its suppliers, Viveve forecasts anticipated product orders and material requirements to predict its inventory needs up to six months in advance and enter into purchase orders on the basis of these requirements. Viveve’s limited historical experience may not provide it with enough data to accurately predict future demand. If Viveve’s business expands, its demand for components and materials would increase and Viveve’s suppliers may be unable to meet its demand. If Viveve overestimates its component and material requirements, Viveve will have excess inventory, which would increase Viveve’s expenses. If Viveve underestimates its component and material requirements, it may have inadequate inventory, which could interrupt, delay or prevent delivery of the Viveve System to Viveve’s customers. Any of these occurrences would negatively affect Viveve’s financial performance and the level of satisfaction that Viveve’s customers have with its business.

Even though Viveve requires training for users of the Viveve System and does not sell the Viveve System to non-physicians, there exists a potential for misuse, which could harm Viveve’s reputation and its business.

Internationally, Viveve’s independent distributors sell in many jurisdictions that do not require specific qualifications or training for purchasers or operators of the Viveve System. Viveve does not supervise the procedures performed with the Viveve System, nor can Viveve be assured that direct physician supervision of its equipment occurs according to Viveve’s recommendations. Viveve, and its distributors, require purchasers of the Viveve System to undergo an initial training session as a condition of purchase, but do not require ongoing training. In addition, Viveve prohibits the sale of the Viveve System to companies that rent the Viveve System to third parties, but it cannot prevent an otherwise qualified physician from contracting with a rental company in violation of their purchase agreement with Viveve.

In the U.S., Viveve intends to only sell the Viveve System to licensed physicians who have met certain training requirements. However, current Federal regulations will allow Viveve to sell the Viveve System to “licensed practitioners.” The definition of “licensed practitioners” varies from state to state. As a result, the Viveve System may be operated by licensed practitioners with varying levels of training, and in many states by non-physicians, including physician assistants, registered nurses and nurse practitioners. Thus, in some states, the definition of “licensed practitioner” may result in the legal use of the Viveve System by non-physicians.

The use of the Viveve System by non-physicians, as well as noncompliance with the operating guidelines set forth in Viveve’s training programs, may result in product misuse and adverse treatment outcomes, which could harm Viveve’s reputation and expose it to costly product liability litigation.

Product liability suits could be brought against Viveve due to defective design, labeling, material or workmanship, or misuse of the Viveve System, and could result in expensive and time-consuming litigation, payment of substantial damages and an increase in Viveve’s insurance rates.

If the Viveve System is defectively designed, manufactured or labeled, contains defective components or is misused, Viveve may become subject to substantial and costly litigation by Viveve’s customers or their patients. Misusing the Viveve System or failing to adhere to operating guidelines could cause serious adverse events. In addition, if Viveve’s operating guidelines are found to be inadequate, it may be subject to liability. Viveve may, in the future, be involved in litigation related to the use of the Viveve System. Product liability claims could divert management’s attention from Viveve’s core business, be expensive to defend and result in sizable damage awards against Viveve. Viveve may not have sufficient insurance coverage for all future claims. Viveve may not be able to obtain insurance in amounts or scope sufficient to provide Viveve with adequate coverage against all potential liabilities. Any product liability claims brought against Viveve, with or without merit, could increase Viveve’s product liability insurance rates or prevent it from securing continuing coverage, could harm Viveve’s reputation in the industry and reduce product sales. Product liability claims in excess of Viveve’s insurance coverage would be paid out of cash reserves, harming Viveve’s financial condition and reducing its operating results.

After-market modifications to Viveve’s treatment tips by third parties and the development of counterfeit products could reduce Viveve’s sales, expose it to product liability litigation and dilute its brand quality.

Third parties may introduce adulterated after-market modifications to Viveve’s treatment tips, which enable re-use of Viveve’s treatment tips in multiple procedures. Because Viveve’s treatment tips are designed to withstand a finite number of pulses, modifications intended to increase the number of pulses could result in patient injuries caused by the use of worn-out or damaged treatment tips. In addition, third parties may seek to develop counterfeit products that are compatible with the Viveve System and available to practitioners at lower prices than Viveve’s. If security features incorporated into the design of the Viveve System are unable to prevent after-market modifications to Viveve’s treatment tips or the introduction of counterfeit products, Viveve could be subject to reduced sales, product liability lawsuits resulting from the use of damaged or defective goods and damage to Viveve’s reputation.

Viveve depends on skilled and experienced personnel to operate its business effectively. If Viveve is unable to recruit, hire and retain these employees, Viveve’s ability to manage and expand its business will be harmed, which would impair its future revenue and profitability.

Viveve’s success largely depends on the skills, experience and efforts of its officers and other key employees. While Viveve has employment contracts with many of its officers and other key employees, Viveve’s officers and other key employees may terminate their employment at any time. The loss of any senior management team members could weaken Viveve’s management expertise and harm its business.

Viveve’s ability to retain its skilled labor force and its success in attracting and hiring new skilled employees will be a critical factor in determining whether Viveve will be successful in the future. Viveve may not be able to meet its future hiring needs or retain existing personnel. Viveve will face particularly significant challenges and risks in hiring, training, managing and retaining engineering and sales and marketing employees, as well as independent distributors, most of whom are geographically dispersed and must be trained in the use and benefits of the Viveve System. Failure to attract and retain personnel, particularly technical and sales and marketing personnel, would materially harm Viveve’s ability to compete effectively and grow its business.

Any acquisitions that Viveve makes could disrupt its business and harm its financial condition.

Viveve expects to evaluate potential strategic acquisitions of complementary businesses, products or technologies. Viveve may also consider joint ventures and other collaborative projects. Viveve may not be able to identify appropriate acquisition candidates or strategic partners, or successfully negotiate, finance or integrate acquisitions of any businesses, products or technologies. Furthermore, the integration of any acquisition and management of any collaborative project may divert management’s time and resources from Viveve’s core business and disrupt its operations. Viveve does not have any experience with acquiring companies or products. If Viveve decides to expand its product offerings beyond radiofrequency technologies, Viveve may spend time and money on projects that do not increase its revenue.

Viveve Risks Related to Regulatory Matters

Viveve may be unable to obtain or maintain international regulatory qualifications or approvals for its current or future products and indications, which could harm its business.

Sales of the Viveve System internationally are subject to foreign regulatory requirements that vary widely from country to country. In addition, the FDA regulates exports of medical devices from the U.S. Complying with international regulatory requirements can be an expensive and time-consuming process, and approval is not certain. The time required to obtain clearances or approvals, if required by other countries, may be longer than that required for FDA clearance or approvals, and requirements for such clearances or approvals may significantly differ from FDA requirements. Viveve may rely upon third-party distributors to obtain all regulatory clearances and approvals required in other countries, and these distributors may be unable to obtain or maintain such clearances or approvals. Viveve’s distributors may also incur significant costs in attempting to obtain and in maintaining foreign regulatory approvals or qualifications, which could increase the difficulty of attracting and retaining qualified distributors. If Viveve’s distributors experience delays in receiving necessary qualifications, clearances or approvals to market its products outside the U.S., or if they fail to receive those qualifications, clearances or approvals, Viveve may be unable to market its products or enhancements in international markets effectively, or at all.

If Viveve fails to maintain regulatory approvals and clearances, or is unable to obtain, or experience significant delays in obtaining, FDA clearances or approvals for the Viveve System or Viveve’s future products or product enhancements, its ability to commercially distribute and market these products could suffer.

The Viveve System and Viveve’s future products are subject to rigorous regulation by the FDA and numerous other federal, state and foreign governmental authorities. The process of obtaining regulatory clearances or approvals to market a medical device can be costly and time consuming, and Viveve may not be able to obtain these clearances or approvals on a timely basis, if at all. In particular, the FDA permits commercial distribution of a new medical device only after the device has received clearance under Section 510(k) of the Federal Food, Drug and Cosmetic Act, approval of a de novo reclassification petition, or is the subject of an approved premarket approval application, or PMA unless the device is specifically exempt from those requirements. The FDA will clear marketing of a lower risk medical device through the 510(k) process if the manufacturer demonstrates that the new product is substantially equivalent to other 510(k)-cleared products. High risk devices deemed to pose the greatest risk, such as life-sustaining, life-supporting, or implantable devices, or devices not deemed substantially equivalent to a previously cleared device, require the approval of a PMA. The PMA process is more costly, lengthy and uncertain than the 510(k) clearance process. A PMA application must be supported by extensive data, including, but not limited to, technical, preclinical, clinical trial, manufacturing and labeling data, to demonstrate to the FDA’s satisfaction the safety and efficacy of the device for its intended use.

If there is no known predicate for a device, a company can request a de novo reclassification of the product. De novo generally applies where there is no predicate device and the FDA believes the device is sufficiently safe so that no PMA should be required. FDA’s de novo process has just been streamlined to allow a company to request that a new product classification be developed based on information provided by the requesting company. Viveve intends to utilize the Direct De Novo process for the Viveve System. However, Viveve cannot predict when or if such approval will be obtained, or whether FDA will create a new product code. Failure to approve the de novo petition, or establishment of a new product code could require Viveve to seek a PMA for the Viveve System. Delays in receipt or failure to receive clearances or approvals could reduce Viveve’s sales, profitability and future growth prospects.

Foreign governmental authorities that regulate the manufacture and sale of medical devices have become increasingly stringent and, to the extent Viveve markets and sells its products internationally, it may be subject to rigorous international regulation in the future. In these circumstances, Viveve would rely significantly on its foreign independent distributors to comply with the varying regulations, and any failures on their part could result in restrictions on the sale of Viveve’s products in foreign countries.

If Viveve modifies an FDA-cleared device, Viveve may need to seek and obtain new clearances, which, if not granted, would prevent Viveve from selling its modified product or require Viveve to redesign its product.

Any modifications to an FDA-cleared device that could significantly affect its safety or effectiveness or that would constitute a major change in its intended use would require a new 510(k) clearance or possibly a premarket approval. Viveve may not be able to obtain additional 510(k) clearances or premarket approvals for new products or for modifications to, or additional indications for, Viveve’s existing product in a timely fashion, or at all. Delays in obtaining future clearances would adversely affect Viveve’s ability to introduce new or enhanced products in a timely manner, which in turn could harm Viveve’s revenue and potential future profitability. Viveve has made modifications to its device in the past and may make additional modifications in the future that Viveve believes do not or will not require additional clearances or approvals. If the FDA disagrees, and requires new clearances or approvals for the modifications, Viveve may be required to recall and to stop marketing the modified device, which could harm its operating results and require Viveve to redesign its product.

If Viveve modifies a PMA approved device, Viveve may need to seek and obtain approval of a PMA Supplement, which, if not granted, would prevent Viveve from selling its modified product or require it to redesign its product.

New PMAs or PMA Supplements are required for modifications that affect the safety or effectiveness of the device, including, for example, certain types of modifications to the device’s indication for use, manufacturing process, labeling and design. PMA Supplements often require submission of the same type of information as a PMA, except that the supplement is limited to information needed to support any changes from the device covered by the original PMA and may not require as extensive clinical data or the convening of an advisory panel. There is no guarantee that the FDA will grant PMA approval of Viveve’s future products, if one is required, and failure to obtain necessary approvals for Viveve’s future products would adversely affect its ability to grow its business. Delays in receipt or failure to receive approvals could reduce Viveve’s sales, profitability and future growth prospects.

Clinical trials necessary to support a 510(k) or a PMA application will be expensive and will require the enrollment of large numbers of patients, and suitable patients may be difficult to identify and recruit. Delays or failures in Viveve’s clinical trials will prevent Viveve from commercializing any modified or new products and will adversely affect Viveve’s business, operating results and prospects.

The FDA has asked Viveve to conduct an investigational device exemption, or IDE, study to support a future product submission for the Viveve System. Initiating and completing clinical trials necessary to support a 510(k) or a PMA application for the Viveve System, as well as other possible future product candidates, will be time consuming and expensive and the outcome uncertain. Moreover, the results of early clinical trials are not necessarily predictive of future results, and any product Viveve advances into clinical trials may not have favorable results in later clinical trials.

Conducting successful clinical studies will require the enrollment of patients, and suitable patients may be difficult to identify and recruit. Patient enrollment in clinical trials and completion of patient participation and follow-up depends on many factors, including the size of the patient population, the nature of the trial protocol, the attractiveness of, or the discomforts and risks associated with, the treatments received by enrolled subjects, the availability of appropriate clinical trial investigators, support staff, and proximity of patients to clinical sites and ability to comply with the eligibility and exclusion criteria for participation in the clinical trial and patient compliance. For example, patients may be discouraged from enrolling in Viveve’s clinical trials if the trial protocol requires them to undergo extensive post-treatment procedures or follow-up to assess the safety and effectiveness of Viveve’s products or if they determine that the treatments received under the trial protocols are not attractive or involve unacceptable risks or discomforts.

Development of sufficient and appropriate clinical protocols to demonstrate safety and efficacy are required and Viveve may not adequately develop such protocols to support clearance and approval. Further, the FDA may require Viveve to submit data on a greater number of patients than Viveve originally anticipated and/or for a longer follow-up period or change the data collection requirements or data analysis applicable to Viveve’s clinical trials. Delays in patient enrollment or failure of patients to continue to participate in a clinical trial may cause an increase in costs and delays in the approval and attempted commercialization of Viveve’s products or result in the failure of the clinical trial. In addition, despite considerable time and expense invested in Viveve’s clinical trials, the FDA may not consider Viveve’s data adequate to demonstrate safety and efficacy. Such increased costs and delays or failures could adversely affect Viveve’s business, operating results and prospects.

If the third parties on which Viveve relies to conduct its clinical trials and to assist Viveve with pre-clinical development do not perform as contractually required or expected, Viveve may not be able to obtain regulatory clearance or approval for or commercialize its products.

Viveve does not have the ability to independently conduct its pre-clinical and clinical trials for its products and Viveve must rely on third parties, such as contract research organizations, medical institutions, clinical investigators and contract laboratories to conduct such trials. If these third parties do not successfully carry out their contractual duties or regulatory obligations or meet expected deadlines, if these third parties need to be replaced, or if the quality or accuracy of the data they obtain is compromised due to the failure to adhere to Viveve’s clinical protocols or regulatory requirements or for other reasons, Viveve’s pre-clinical development activities or clinical trials may be extended, delayed, suspended or terminated, and Viveve may not be able to obtain regulatory approval for, or successfully commercialize, Viveve’s products on a timely basis, if at all, and Viveve’s business, operating results and prospects may be adversely affected. Furthermore, Viveve’s third-party clinical trial investigators may be delayed in conducting Viveve’s clinical trials for reasons outside of their control.

The results of Viveve’s clinical trials may not support its proposed product claims or may result in the discovery of adverse side effects.

Even if Viveve’s clinical trials are completed as planned, it cannot be certain that the results of the clinical trials will support Viveve’s proposed claims for the Viveve System or that the FDA or foreign authorities will agree with Viveve’s conclusions regarding them. Success in pre-clinical studies and early clinical trials does not ensure that later clinical trials will be successful, and Viveve cannot be sure that the later trials will replicate the results of prior trials and pre-clinical studies. The clinical trial process may fail to demonstrate that Viveve’s product candidates are safe and effective for the proposed indicated uses, which could cause Viveve to abandon a product candidate and may delay development of others. Any delay or termination of Viveve’s clinical trials will delay the filing of Viveve’s product submissions and, ultimately, Viveve’s ability to commercialize its product candidates and generate revenues.

Even if Viveve’s products are approved by regulatory authorities, if Viveve or its suppliers fail to comply with ongoing FDA or other foreign regulatory authority requirements, or if Viveve experiences unanticipated problems with Viveve’s products, these products could be subject to restrictions or withdrawal from the market.

Any product for which Viveve obtains clearance or approval, and the manufacturing processes, reporting requirements, post-approval clinical data and promotional activities for such product, will be subject to continued regulatory review, oversight and periodic inspections by the FDA and other domestic and foreign regulatory bodies, such as the Food and Drug Branch of the California Department of Health Services, or CDHS. In particular, Viveve and its suppliers are required to comply with the FDA’s Quality System Regulations, or QSR, and International Standards Organization, or ISO, regulations for the manufacture of its products and other regulations which cover the methods and documentation of the design, testing, production, control, quality assurance, labeling, packaging, storage and shipping of any product for which Viveve obtains clearance or approval. Regulatory bodies, such as the FDA, enforce the QSR and other regulations through periodic inspections. In the past, Viveve’s facility has been inspected by the FDA and CDHS, and observations were noted. The FDA and CDHS have accepted Viveve’s responses to these observations, and Viveve believes that it is in substantial compliance with the QSR. Any future failure by Viveve or one of its suppliers to comply with applicable statutes and regulations administered by the FDA and other regulatory bodies, or the failure to timely and adequately respond to any adverse inspectional observations or product safety issues, could result in, among other things, any of the following enforcement actions:

If any of these actions were to occur it would harm Viveve’s reputation and cause Viveve’s product sales and profitability to suffer and may prevent Viveve from generating revenue. Furthermore, Viveve’s third party manufacturers may not currently be or may not continue to be in compliance with all applicable regulatory requirements which could result in Viveve’s failure to produce its products on a timely basis and in the required quantities, if at all.

Even if regulatory clearance or approval of a product is granted for the Viveve System or future products, such clearance or approval may be subject to limitations on the intended uses for which the product may be marketed and reduce Viveve’s potential to successfully commercialize the product and generate revenue from the product. If the FDA determines that Viveve’s promotional materials, labeling, training or other marketing or educational activities constitute promotion of an unapproved use, it could request that Viveve cease or modify its training or promotional materials or subject Viveve to regulatory enforcement actions. It is also possible that other federal, state or foreign enforcement authorities might take action if they consider Viveve’s training or other promotional materials to constitute promotion of an unapproved use, which could result in significant fines or penalties under other statutory authorities, such as laws prohibiting false claims for reimbursement.

In addition, Viveve may be required to conduct costly post-market testing and surveillance to monitor the safety or effectiveness of its products, and Viveve must comply with medical device reporting requirements, including the reporting of adverse events and malfunctions related to its products. Later discovery of previously unknown problems with Viveve’s products, including unanticipated adverse events or adverse events of unanticipated severity or frequency, manufacturing problems, or failure to comply with regulatory requirements such as QSR, may result in changes to labeling, restrictions on such products or manufacturing processes, withdrawal of the products from the market, voluntary or mandatory recalls, a requirement to repair, replace or refund the cost of any medical device Viveve manufactures or distributes, fines, suspension of regulatory approvals, product seizures, injunctions or the imposition of civil or criminal penalties which would adversely affect Viveve’s business, operating results and prospects.

The Viveve System may also be subject to state regulations which are, in many instances, in flux. Changes in state regulations may impede sales. For example, federal regulations may allow the Viveve System to be sold to, or on the order of, “licensed practitioners,” as determined on a state-by-state basis. As a result, in some states, non-physicians may legally purchase and operate the Viveve System. However, a state could change its regulations at any time, disallowing sales to particular types of end users. Viveve cannot predict the impact or effect of future legislation or regulations at the federal or state levels.

If Viveve or its third-party manufacturers fail to comply with the FDA’s Quality System Regulation, Viveve’s business would suffer.

Viveve’s and its third-party manufacturers are required to demonstrate and maintain compliance with the FDA’s Quality System Regulation, or QSR. The QSR is a complex regulatory scheme that covers the methods and documentation of the design, testing, control, manufacturing, labeling, quality assurance, packaging, storage and shipping of Viveve’s product. The FDA enforces the QSR through periodic unannounced inspections. Viveve anticipates that in the future it will be subject to such inspections. Viveve’s failure, or the failure of its third-party manufacturers, to take satisfactory corrective action in response to an adverse QSR inspection could result in enforcement actions, including a public warning letter, a shutdown of Viveve’s manufacturing operations, a recall of Viveve’s product, civil or criminal penalties or other sanctions, which would cause Viveve’s sales and business to suffer.

If Viveve’s products cause or contribute to a death or a serious injury, or malfunction in certain ways, Viveve will be subject to medical device reporting regulations, which can result in voluntary corrective actions or agency enforcement actions.

Under the FDA medical device reporting regulations, medical device manufacturers are required to report to the FDA information that a device has or may have caused or contributed to a death or serious injury or has malfunctioned in a way that would likely cause or contribute to death or serious injury if the malfunction of the device or one of Viveve’s similar devices were to recur. If Viveve fails to report these events to the FDA within the required timeframes, or at all, the FDA could take enforcement action against Viveve. Any such adverse event involving the Viveve System or future products could result in future voluntary corrective actions, such as recalls or customer notifications, or agency action, such as inspection or enforcement action. Any corrective action, whether voluntary or involuntary, as well as defending itself in a lawsuit, will require the dedication of Viveve’s time and capital, distract management from operating Viveve’s business, and may harm Viveve’s reputation and financial results.

The Viveve System may in the future be subject to product recalls that could harm Viveve’s reputation, business and financial results.

The FDA and similar foreign governmental authorities have the authority to require the recall of commercialized products in the event of material deficiencies or defects in design or manufacture. In the case of the FDA, the authority to require a recall must be based on an FDA finding that there is a reasonable probability that the device would cause serious injury or death. In addition, foreign governmental bodies have the authority to require the recall of Viveve’s products in the event of material deficiencies or defects in design or manufacture. Manufacturers may, under their own initiative, recall a product if any material deficiency in a device is found. A government-mandated or voluntary recall by Viveve or one of its distributors could occur as a result of component failures, manufacturing errors, design or labeling defects or other deficiencies and issues. Recalls of Viveve’s products would divert managerial and financial resources and have an adverse effect on Viveve’s financial condition and results of operations. The FDA requires that certain classifications of recalls be reported to the FDA within 10 working days after the recall is initiated. Companies are required to maintain certain records of recalls, even if they are not reportable to the FDA. Viveve may initiate voluntary recalls involving its products in the future that it determines do not require notification to the FDA. If the FDA disagrees with Viveve’s determinations, they could require Viveve to report those actions as recalls. A future recall announcement could harm Viveve’s reputation with customers and negatively affect Viveve’s sales. In addition, the FDA could take enforcement action for failing to report the recalls when they were conducted.

Federal and state regulatory reforms may adversely affect Viveve’s ability to sell its products profitably.

From time to time, legislation is drafted and introduced in Congress that could significantly change the statutory provisions governing the clearance or approval, manufacture and marketing of a medical device. In addition, FDA regulations and guidance are often revised or reinterpreted by the agency in ways that may significantly affect Viveve’s business and its products. It is impossible to predict whether legislative changes will be enacted or FDA regulations, guidance or interpretations changed, and what the impact of such changes, if any, may be.

For example, in August 2010, the FDA issued its preliminary recommendations on reform of the 510(k) premarket notification process for medical devices. On January 19, 2011, the FDA announced its “Plan of Action” for implementing these recommendations. The Plan of Action included 25 action items, including revising existing guidance or developing guidance to clarify various aspects of the 510(k) process and to streamline the review process for innovative, lower risk products (the “de novo” process); improving training for the Center for Devices and Radiological Health (“CDRH”) staff and industry; increasing reliance on external experts; and addressing and improving internal processes. The FDA has already begun implementing many of these reforms, and may implement other reforms in the future, which could have the effect of making it more difficult and expensive for Viveve to obtain 510(k) clearance.

Failure to comply with the U.S. Foreign Corrupt Practices Act and similar laws associated with Viveve’s activities outside the U.S. could subject it to penalties and other adverse consequences.

A significant portion of Viveve’s revenues is and will be from jurisdictions outside of the U.S. As a result, Viveve is subject to the U.S. Foreign Corrupt Practices Act, or the FCPA, which generally prohibits U.S. companies and their intermediaries from making corrupt payments to foreign officials for the purpose of directing, obtaining or keeping business, and requires companies to maintain reasonable books and records and a system of internal accounting controls. The FCPA applies to companies and individuals alike, including company directors, officers, employees and agents. Under the FCPA, U.S. companies may be held liable for the corrupt actions taken by employees, strategic or local partners or other representatives. In addition, the government may seek to rely on a theory of successor liability and hold Viveve responsible for FCPA violations committed by companies or associated with assets which Viveve acquires.

In many foreign countries where Viveve operates, particularly in countries with developing economies, it may be a local custom for businesses to engage in practices that are prohibited by the FCPA or other similar laws and regulations. In contrast, Viveve has implemented a company policy requiring its employees and consultants to comply with the FCPA and similar laws. Although Viveve has not conducted formal FCPA compliance training, Viveve is in the process of devising a training schedule for certain of its employees, agents and partners. Nevertheless, there can be no assurance that Viveve’s employees, partners and agents, as well as those companies to which Viveve outsources certain of its business operations, will not take actions in violation of the FCPA or Viveve’s policies for which Viveve may be ultimately held responsible. As a result of its anticipated growth, Viveve’s development of infrastructure designed to identify FCPA matters and monitor compliance is at an early stage. If Viveve or its intermediaries fail to comply with the requirements of the FCPA or similar legislation, governmental authorities in the U.S. and elsewhere could seek to impose civil and/or criminal fines and penalties which could have a material adverse effect on Viveve’s business, operating results and financial conditions. Viveve may also face collateral consequences such as debarment and the loss of its export privileges.

Viveve Risks Related to Its Intellectual Property

Intellectual property rights may not provide adequate protection for the Viveve System, which may permit third parties to compete against Viveve more effectively.

Viveve relies on patent, copyright, trade secret and trademark laws and confidentiality agreements to protect its technology and the Viveve System. Viveve has an exclusive license to 8 issued U.S. patents primarily covering the Viveve System and methods of use, the earliest of which expire in 2015; 3 pending U.S. patent applications, 12 issued foreign patents and 17 pending foreign patent applications, some of which foreign applications preserve an opportunity to pursue patent rights in multiple countries. Some of Viveve’s system components are not, and in the future may not be, protected by patents. Additionally, Viveve’s patent applications may not issue as patents or, if issued, may not issue in a form that will be advantageous to Viveve. Any patents Viveve obtains may be challenged, invalidated or legally circumvented by third parties. Consequently, competitors could market products and use manufacturing processes that are substantially similar to, or superior to, Viveve’s. Viveve may not be able to prevent the unauthorized disclosure or use of its technical knowledge or other trade secrets by consultants, vendors, former employees or current employees, despite the existence generally of confidentiality agreements and other contractual restrictions. Monitoring unauthorized uses and disclosures of Viveve’s intellectual property is difficult, and Viveve does not know whether the steps it has taken to protect its intellectual property will be effective. Moreover, Viveve does not have patent rights in all foreign countries in which a market may exist, and where Viveve has applied for foreign patent rights, the laws of many foreign countries will not protect Viveve’s intellectual property rights to the same extent as the laws of the U.S.

In addition, competitors could purchase the Viveve System and attempt to replicate some or all of the competitive advantages Viveve derives from Viveve’s development efforts, willfully infringe Viveve’s intellectual property rights, design around Viveve’s protected technology or develop their own competitive technologies that fall outside of Viveve’s intellectual property rights. If Viveve’s intellectual property is not adequately protected so as to defend Viveve’s market against competitors’ products and methods, Viveve’s competitive position could be adversely affected, as could Viveve’s business.

Viveve may be involved in future costly intellectual property litigation, which could impact its future business and financial performance.

Viveve’s industry has been characterized by frequent intellectual property litigation. Viveve’s competitors or other patent holders may assert that the Viveve System and the methods Viveve employs are covered by their patents. If the Viveve System or methods are found to infringe, Viveve could be prevented from marketing the Viveve System. In addition, Viveve does not know whether its competitors or potential competitors have applied for, or will apply for or obtain, patents that will prevent, limit or interfere with Viveve’s ability to make, use, sell, import or export the Viveve System. Viveve may also initiate litigation against third parties to protect its own intellectual property that may be expensive, protracted or unsuccessful. In the future there may be companies that market products for competing purposes in direct challenge to Viveve’s intellectual property position, and Viveve may be required to initiate litigation in order to stop them. If Viveve initiates litigation to protect its rights, it runs the risk of having its patents invalidated, which would undermine Viveve’s competitive position.

Litigation related to infringement and other intellectual property claims, with or without merit, is unpredictable, can be expensive and time-consuming and could divert management’s attention from Viveve’s core business. If Viveve loses this kind of litigation, a court could require Viveve to pay substantial damages, and prohibit it from using technologies essential to the Viveve System, any of which would have a material adverse effect on Viveve’s business, results of operations and financial condition. Viveve does not know whether necessary licenses would be available to it on satisfactory terms, or whether it could redesign the Viveve System or processes to avoid infringement.

Competing products may also appear in other countries in which Viveve’s patent coverage might not exist or be as strong. If Viveve loses a foreign patent lawsuit, it could be prevented from marketing the Viveve System in one or more countries.

In addition, Viveve may hereafter become involved in litigation to protect its trademark rights associated with its company name or the names used with the Viveve System. Names used with the Viveve System and procedures may be claimed to infringe names held by others or to be ineligible for proprietary protection. If Viveve has to change the name of its company or Viveve System, Viveve may experience a loss in goodwill associated with its brand name, customer confusion and a loss of sales.

Risks Related to PLC and the Proposed Transaction

Our shareholders will experience immediate dilution as a consequence of the issuance of common stock as consideration in the Proposed Transaction and will be further diluted as a result of the Offering. Having a minority share position may reduce the influence that our current shareholders have on the management of the Company.

We will issue approximately 4,655,023 shares of our capital stock at the closing of the Proposed Transaction to the Viveve accredited equity holders and their designees, after giving effect to the Share Consolidation. As a result, our current shareholders will hold 2,762,551 shares after giving effect to the Share Consolidation or (without giving effect to the Offering described below) approximately 37.2% of the issued and outstanding PLC Shares on a fully diluted basis. Consequently, the ability of our current shareholders following the Proposed Transaction to influence management of the Company through the election of directors will be substantially reduced.

As contemplated by the Viveve Merger Agreement, immediately following the closing of the Proposed Transaction, PLC will complete the Offering for aggregate gross proceeds of $4,500,000 in cash payments and the conversion of up to approximately $1,500,000 outstanding amount of principal and interest of certain Viveve bridge notes. After the closing of the Offering and after giving effect to the Share Consolidation, it is anticipated that the current PLC shareholders will own 14.7%, the former equity holders of Viveve will own 24.9% and the investors participating in the Offering will own 60.4% of the 18,738,339 issued and outstanding PLC Shares after the Offering. This Offering will further dilute our shareholders’ ownership in the Company and further reduce their ability to influence management of the Company through election of directors.

Because we are incorporated in Canada, you may not be able to enforce judgments against us and our Canadian directors.

Under Canadian law, you may not be able to enforce a judgment issued by courts in the U.S. against us or our Canadian directors. The status of the law in Canada is unclear as to whether a U.S. citizen can enforce a judgment from a U.S. court in Canada for violations of U.S. securities laws. A separate suit may need to be brought directly in Canada.

Our stock price has historically fluctuated and may continue to fluctuate significantly in the future which may result in losses for our investors.

Our stock price has been and may continue to be volatile. Some of the factors that can affect our stock price are:

The market price of our stock may fall if shareholders sell their stock.

Certain current shareholders hold large amounts of our stock, which they could seek to sell in the public market from time to time. Sales of a substantial number of shares of our common stock within a short period of time would cause our stock price to fall. In addition, the sale of these shares could impair our ability to raise capital through the sale of additional stock.

We may not be able to timely and effectively implement controls and procedures required by Section 404 of the Sarbanes-Oxley Act of 2002 that will be applicable to us after the Proposed Transaction.

Viveve is not currently subject to Section 404 of the Sarbanes-Oxley Act of 2002. However, following the Proposed Transaction, when the officers and employees of Viveve will become the officers and employees of PLC and PLC’s current officers and employees will terminate their relationship with PLC, we will be subject to Section 404. The standards required for a public company under Section 404 of the Sarbanes-Oxley Act of 2002 are significantly more stringent than those required of Viveve, as a privately-held company. Management may not be able to effectively and timely implement controls and procedures that adequately respond to the increased regulatory compliance and reporting requirements that will be applicable to the Company after the Proposed Transaction. If we are not able to implement the additional requirements of Section 404 in a timely manner or with adequate compliance, we may not be able to assess whether our internal controls over financial reporting are effective, which may subject us to adverse regulatory consequences and could harm investor confidence and the market price of our common stock.

Subsequent to the consummation of the Proposed Transaction, we may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and stock price, which could cause you to lose some or all of your investment.

Although we have conducted due diligence on Viveve, we cannot assure you that this diligence revealed all material issues that may be present in Viveve’s businesses, that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors outside of our and Viveve’s control will not later arise. As a result, we may be forced to later write-down or write-off assets, restructure Viveve’s operations, or incur impairment or other charges that could result in losses. Even if our due diligence successfully identifies certain risks, unexpected risks may arise and previously known risks may materialize in a manner not consistent with our preliminary risk analysis. Even though these charges may be non-cash items and not have an immediate impact on our liquidity, the fact that we report charges of this nature could contribute to negative market perceptions about the Company or its securities. In addition, charges of this nature may cause us to be unable to obtain future financing on favorable terms or at all.

Concentration of ownership after the Proposed Transaction may have the effect of delaying or preventing a change in control.

If the Proposed Transaction and Offering are consummated, 5AM Ventures II (in conjunction with 5AM Co-investors II), and GBS Venture Partners Limited (“GBS Venture”), equity and convertible debenture holders of Viveve, will own 58.3% of the outstanding Common Stock of the Company. As a result, these shareholders, if acting together, have the ability to determine the outcome of corporate actions of the Company requiring shareholder approval. This concentration of ownership may have the effect of delaying or preventing a change in control and might adversely affect the market price of our common stock.

There is, at present, only a limited market for our common stock and we cannot ensure investors that an active market for our common stock will ever develop or be sustained.

Our shares of common stock are thinly traded. Due to the illiquidity, the market price may not accurately reflect our relative value. There can be no assurance that there will be an active market for our shares of common stock either now or in the future. Because our common stock is so thinly traded, a large block of shares traded can lead to a dramatic fluctuation in the share price and investors may not be able to liquidate their investment in us at all or at a price that reflects the value of the business. In addition, our common stock currently trades on the OTCQB tier of the OTC Markets Group Inc., which generally lacks the liquidity, research coverage and institutional investor following of a national securities exchange like the NYSE MKT, the New York Stock Exchange or the Nasdaq Stock Market. While we intend to list our common stock on a national securities exchange once we satisfy the initial listing standards for such an exchange, we currently do not, and may not ever, satisfy such initial listing standards.

If the Proposed Transaction’s benefits do not meet the expectations of investors or securities analysts, the market price of our securities may decline.

If the benefits of the Proposed Transaction do not meet the expectations of investors or securities analysts, the market price of the Company’s securities prior to the closing of the Proposed Transaction may decline. The market values of our securities at the time of the Proposed Transaction may vary significantly from their prices on the date the Viveve Merger Agreement was executed, the date of this proxy statement, or the date on which our shareholders vote on the Proposed Transaction. Because the exchange ratio in the Viveve Merger Agreement will not be adjusted to reflect any changes in the market price of our common stock, the market value of the Company common stock issued in the Proposed Transaction may be higher or lower than the values of these shares on earlier dates.

In addition, following the Proposed Transaction, fluctuations in the price of our securities could contribute to the loss of all or part of your investment. Prior to the Proposed Transaction, there has not been a public market for Viveve’s stock, and trading in the shares of the Company’s common stock has not been active. Accordingly, the valuation ascribed to Viveve and our common stock in the Proposed Transaction may not be indicative of the price that will prevail in the trading market following the Proposed Transaction. If an active market for our securities develops and continues, the trading price of our securities following the Proposed Transaction could be volatile and subject to wide fluctuations in response to various factors, some of which are beyond our control. Any of the factors listed below could have a material adverse effect on your investment in our securities and our securities may trade at prices significantly below the price you paid for them. In such circumstances, the trading price of our securities may not recover and may experience a further decline.

Factors affecting the trading price of the Company’s securities may include:

Broad market and industry factors may materially harm the market price of our securities irrespective of our operating performance. The stock market in general has experienced price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the particular companies affected. The trading prices and valuations of these stocks, and of our securities, may not be predictable. A loss of investor confidence in the market for retail stocks or the stocks of other companies which investors perceive to be similar to the Company could depress our stock price regardless of our business, prospects, financial conditions or results of operations. A decline in the market price of our securities also could adversely affect our ability to issue additional securities and our ability to obtain additional financing in the future.

If, following the Proposed Transaction, securities or industry analysts do not publish or cease publishing research or reports about the Company, its business, or its market, or if they change their recommendations regarding our common stock adversely, the price and trading volume of our common stock could decline.

The trading market for our common stock will be influenced by the research and reports that industry or securities analysts may publish about us, our business, our market, or our competitors. Securities and industry analysts do not currently, and may never, publish research on the Company. If no securities or industry analysts commence coverage of the Company, our stock price and trading volume would likely be negatively impacted. If any of the analysts who may cover the Company change their recommendation regarding our stock adversely, or provide more favorable relative recommendations about our competitors, the price of our common stock would likely decline. If any analyst who may cover the Company were to cease coverage of the Company or fail to regularly publish reports on it, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline.

We will be a holding company with no business operations of our own and will depend on cash flow from Viveve to meet our obligations.

Following the Proposed Transaction, we will be a holding company with no business operations of our own or material assets other than the stock of our subsidiaries. All of our operations will be conducted by our subsidiary, Viveve. As a holding company, we will require dividends and other payments from our subsidiaries to meet cash requirements. The terms of any agreements governing indebtedness that we may enter into may restrict our subsidiaries from paying dividends and otherwise transferring cash or other assets to us. If there is an insolvency, liquidation or other reorganization of any of our subsidiary, our shareholders likely will have no right to proceed against their assets. Creditors of our subsidiary will be entitled to payment in full from the sale or other disposal of the assets of our subsidiary before the Company, as an equity holder, would be entitled to receive any distribution from that sale or disposal. If Viveve is unable to pay dividends or make other payments to the Company when needed, we will be unable to satisfy our obligations.

Directors of the Company have potential conflicts of interest in recommending that securityholders vote in favor of approval of the Merger Proposal and Spin-Off Proposal and approval of the other proposals described in this proxy statement.

When considering our Board of directors’ recommendation that the our shareholders vote in favor of the approval of the Merger Proposal and Spin-Off Proposal, our shareholders should be aware that directors and executive officers of the Company have interests in the Proposed Transaction that may be different from, or in addition to, the interests of our shareholders. These interests include:

The exercise of discretion by our directors and officers in agreeing to changes to the terms of the Viveve Merger Agreement and the RenalGuard Reorganization Agreement, or waivers of closing conditions in the Viveve Merger Agreement may result in a conflict of interest when determining whether such changes to the terms of the Viveve Merger Agreement or the RenalGuard Reorganization Agreement or waivers of conditions are appropriate and in PLC’s securityholders’ best interest.

In the period leading up to the closing of the Proposed Transaction, events may occur that, pursuant to the Viveve Merger Agreement, would require the Company to agree to amend the Viveve Merger Agreement, to consent to certain actions taken by Viveve or to waive rights that we are or may be entitled to under such agreement. Such events could arise because of changes in the course of Viveve’s business, a request by Viveve to undertake actions that would otherwise be prohibited by the terms of the Viveve Merger Agreement or the occurrence of other events that would have a material adverse effect on Viveve’s business and would entitle the Company to terminate the Viveve Merger Agreement. In any of such circumstances, it would be in the discretion of the Company, acting through its Board of directors, to grant its consent or waive its rights. The existence of the financial and personal interests of the directors described elsewhere in this proxy statement may result in a conflict of interest on the part of one or more of the directors between what he may believe is best for the Company and our securityholders and what he may believe is best for himself or his affiliates in determining whether or not to take the requested action. As of the date of this proxy statement, we do not believe there will be any changes or waivers that our directors and officers would be likely to make after shareholder approval of the Proposed Transaction has been obtained. While certain changes could be made without further shareholder approval, if there is a change to the terms of the transaction that would have a material impact on the shareholders, we will be required to circulate a new or amended proxy statement or supplement thereto and resolicit the vote of our shareholders with respect to the Merger Proposal and Spin-Off Proposal.

The PLC Board of Directors did not obtain a third-party valuation or fairness opinion in determining whether or not to proceed with the Proposed Transaction.

Our Board of Directors did not obtain a third-party valuation or fairness opinion in connection with their determination to approve the Viveve Merger and the RenalGuard Spin-Off. In analyzing the Proposed Transaction, our Board and management conducted due diligence on Viveve, researched the industry in which Viveve operates, and developed a long-range financial model and concluded that the Proposed Transaction was in the best interest of our shareholders. The lack of a third-party valuation or fairness opinion may lead an increased number of our shareholders to vote against the Merger Proposal and the Spin-Off Proposal, which could potentially impact our ability to consummate the Proposed Transaction.

The Company and Viveve will be subject to business uncertainties and contractual restrictions while the Proposed Transaction is pending.

Uncertainty about the effect of the Proposed Transaction on employees and customers may have an adverse effect on the Company and Viveve. These uncertainties may impair our or Viveve’s ability to retain and motivate key personnel and could cause customers and others that deal with any of us or them to defer entering into contracts or making other decisions or seek to change existing business relationships. If key employees depart because of uncertainty about their future roles and the potential complexities of the Proposed Transaction, our or Viveve’s business could be harmed.

We will incur significant transaction and transition costs in connection with the Proposed Transaction.

We expect to incur significant, non-recurring costs in connection with consummating the Proposed Transaction and integrating the operations of Viveve and operating as a public company. We may incur additional costs to maintain employee morale and to retain key employees. We will also incur significant fees and expenses relating to financing arrangements and legal, accounting, financial advisory and other transaction fees and costs associated with the Proposed Transaction. Some of these costs are payable regardless of whether the Proposed Transaction is completed.

The unaudited pro forma financial information included in this document may not be indicative of what our actual financial position or results of operations would have been.

The unaudited pro forma financial information in this proxy statement is presented for illustrative purposes only and is not necessarily indicative of what our actual financial position or results of operations would have been had the Proposed Transaction been completed on the dates indicated. See the section entitled “ Unaudited Pro Forma Condensed Combined Financial Information ” beginning on page 113 for more information.

2014 ANNUAL AND SPECIAL MEETING OF PLC SHAREHOLDERS

General

We are furnishing this proxy statement to our shareholders as part of the solicitation of proxies by our Board of Directors for use at the annual meeting of shareholders to be held on September 18, 2014, and at any adjournment or postponement thereof. This proxy statement is first being furnished to our shareholders on or about August 11, 2014. This proxy statement provides you with information you need to know to be able to vote or instruct your vote to be cast at the annual meeting of shareholders, as applicable.

A copy of our Quarter Report on Form 10-Q for the three months ended March 31, 2014, our Annual Report on Form 10-K for the year ended December 31, 2013 and the financial statements for the fiscal year ended December 31, 2013 contained therein and Amendment No. 1 to our Annual Report on Form 10-K for the year ended December 31, 2013, as filed with the Securities and Exchange Commission, or SEC, will be placed before the annual meeting and will be mailed to each shareholder along with this proxy statement. Shareholders can receive additional copies of the proxy statement or Annual Report upon written or oral request to: PLC Systems Inc., Attention: Gregory Mann, 459 Fortune Boulevard, Milford, MA 01757, telephone: (508) 541-8800.

You should rely only on the information contained in this proxy statement in deciding how to vote. No one has been authorized to provide you with information that is different from that contained in this proxy statement. This proxy statement is dated August 11, 2014. You should not assume that the information contained in this proxy statement is accurate as of any date other than that date.

This proxy statement does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, or a solicitation of a proxy, in any jurisdiction to or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction.

Date, Time and Place of Annual Meeting

The annual meeting of shareholders of PLC will be held at 10:30 a.m. Eastern time, on September 18, 2014, at Doubletree Hotel, 11 Beaver Street, Milford, Massachusetts 01757, or such other date, time and place to which such meeting may be adjourned or postponed, to consider and vote upon the proposals.

Voting Power; Record Date

You will be entitled to vote or direct votes to be cast at the annual meeting of shareholders if you owned shares of our common stock at the close of business on August 11, 2014, which is the Record Date for the annual meeting of shareholders. You are entitled to one vote for each share of our common stock that you owned as of the close of business on the Record Date. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker, bank or other nominee to ensure that votes related to the shares you beneficially own are properly counted. PLC warrants do not have voting rights. On the Record Date, there were 176,025,356 shares of PLC common stock outstanding. Notice of the Record Date, as required by the Business Corporations Act of the Yukon Territory, which we refer to as Yukon law, was published in the Whitehorse Star newspaper on July 31, 2014.

Proxies

All proxies will be voted in accordance with the instructions contained therein. Signed and dated proxies received by us without an indication of how the shareholder intends to vote on a proposal will be voted in favor of each of the Merger Proposal, the Spin-Off Proposal, the Name Change Proposal, the Board Declassification Proposal, the Director Election Proposal, the Incentive Plan Proposal, the Share Consolidation Proposal, the Auditor Proposal and the Adjournment Proposal. Any proxy may be revoked by a shareholder of record at any time before it is exercised by delivering to our Secretary a duly executed proxy bearing a later date than the proxy being revoked or by voting in person at the meeting. Attendance at the meeting will not itself be deemed to revoke a proxy unless the shareholder of record gives affirmative notice at the meeting that the shareholder intends to revoke the proxy and vote in person.

Quorum and Required Vote for Shareholder Proposals

Pursuant to our by-laws, two shareholders, or proxy holders representing two shareholders, holding not less than 10% of the outstanding shares of our common stock entitled to vote at the annual meeting, shall constitute a quorum with respect to that matter at the annual meeting. Shareholders of common stock present in person or represented by proxy (including shareholders who abstain or do not vote with respect to one or more of the matters presented for shareholder approval) will be counted for purposes of determining whether a quorum is present. “Broker non-votes,” which are shares that are held in “street name” by a bank or brokerage firm that indicates on its proxy that it does not have discretionary authority to vote on a particular matter, will not be counted for purposes of determining whether a quorum is present.

Pursuant to our by-laws, if within one-half hour from the time appointed for the annual meeting, a quorum is not present, the annual meeting shall be adjourned to the same day in the following week at the same time and place. If at such adjourned meeting a quorum is not present within one-half hour from the time appointed, the shareholders present in person or by proxy shall constitute a quorum. As of the Record Date for the annual meeting, 12,499,820 shares of our common stock would be required to achieve a quorum.

The approval of the Merger Proposal, the Spin-Off Proposal, the Name Change Proposal, the Board Declassification Proposal and the Share Consolidation Proposal requires the affirmative vote of holders of not less than two-thirds of the shares of common stock voting on the matter. Approval of the Incentive Plan Proposal, the Auditor Proposal, the Director Election Proposal and the Adjournment Proposal requires the affirmative vote of holders of a majority of the shares of common stock voting on the matter. Accordingly, a PLC shareholder’s failure to submit a proxy or to vote in person at the annual meeting, an abstention from voting, or the failure of a PLC shareholder who holds his or her shares in “street name” through a broker or other nominee to give voting instructions to such broker or other nominee will have no effect on the outcome of any vote on such proposals.

Recommendation to PLC Shareholders

Our Board of Directors believes that each of the Merger Proposal, the Spin-Off Proposal, the Name Change Proposal, the Board Declassification Proposal, the Director Election Proposal, the Incentive Plan Proposal, the Share Consolidation, the Auditor Proposal and the Adjournment Proposal to be presented at the annual meeting of shareholders is in the best interests of the Company and our shareholders and unanimously recommends that its shareholders vote “ FOR ” each of the proposals.

When you consider the recommendation of our Board of Directors in favor of approval of the Merger Proposal and Spin-Off Proposal, you should keep in mind that our directors and officers have interests in the Proposed Transaction that are different from, or in addition to, your interests as a shareholder. These interests include, among other things:

Broker Non-Votes and Abstentions

Under the rules of various national and regional securities exchanges, your broker, bank, or nominee cannot vote your shares with respect to non-discretionary matters unless you provide instructions on how to vote in accordance with the information and procedures provided to you by your broker, bank, or nominee. We believe the proposals presented to the shareholders will be considered non-discretionary and therefore your broker, bank, or nominee cannot vote your shares without your instruction. If you do not provide instructions with your proxy, your bank, broker, or other nominee may deliver a proxy card expressly indicating that it is NOT voting your shares; this indication that a bank, broker, or nominee is not voting your shares is referred to as a “broker non-vote.” Broker non-votes will not be counted for the purpose of determining the existence of a quorum, or for purposes of determining the number of votes cast at the annual meeting of shareholders. Your bank, broker, or other nominee can vote your shares only if you provide instructions on how to vote. You should instruct your broker to vote your shares in accordance with directions you provide.

Submitting Your Proxy; Voting Your Shares

Each share of our common stock that you own in your name entitles you to one vote on each of the proposals. Your one or more proxy cards show the number of shares of our common stock that you own. There are several ways to ensure that your vote is counted:

Revoking Your Proxy

If you give a proxy, you may revoke it at any time before the annual meeting of shareholders, or at such meeting by doing any one of the following: