8-K
false 0001350653 0001350653 2020-10-07 2020-10-07

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 7, 2020

 

 

ALPHATEC HOLDINGS, INC.

(Exact Name of Registrant as Specified in Charter)

 

 

 

Delaware   000-52024   20-2463898

(State or Other Jurisdiction

of Incorporation)

  

(Commission

File Number)

  

(I.R.S. Employer

Identification No.)

 

5818 El Camino Real
Carlsbad, California 92008
(Address of Principal Executive Offices)

(760) 431-9286

(Registrant’s telephone number, including area code)

Not applicable

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14.a-12)

 

☐

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

  

Trading

Symbol(s)

  

Name of each exchange

on which registered

Common stock, par value $.0001 per share   ATEC   The NASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

 

Item 2.02

Results of Operations and Financial Condition.

On October 7, 2020, Alphatec Holdings, Inc. (the “Company”) issued a press release announcing selected preliminary unaudited financial information for the third quarter ended September 30, 2020. The Company has not finalized its financial statement closing process for the third quarter ended September 30, 2020. As a result, the information in the press release is preliminary and based upon information available to the Company as of the date of the press release. During the course of the Company’s closing process, items may be identified that would require the Company to make adjustments, which may be material, and as a result, the estimates included in the press release are subject to risks and uncertainties, including possible adjustments to preliminary operating results.

A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K. The information being furnished in this Item 2.02 and in Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section.

 

Item 8.01

Other Events.

On October 13, 2020, the Company issued a press release announcing that it has commenced an underwritten public offering of its common stock with Morgan Stanley & Co. LLC and Cowen and Company, LLC acting as joint book-running managers in the offering, Canaccord Genuity LLC acting as lead manager and Lake Street Capital Markets and Northland Capital Markets acting as co-managers in the offering. In connection with the offering, the Company intends to grant the underwriters a 30-day option to purchase up to an additional 15% of the shares of common stock sold in the offering. All of the shares in the offering are to be sold by the Company. There can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering.

The Company intends to use the net proceeds of the offering for general corporate purposes, including working capital, capital expenditures, and continued research and development with respect to products and technologies. A portion of the net proceeds of the offering may be used to fund possible investments in or acquisitions of complementary businesses, products, or technologies. The Company currently does not have any agreements or commitments to complete any such transaction.

The shares of common stock are being offered pursuant to a shelf registration statement on Form S-3 (File No. 333-241677) declared effective by the Securities and Exchange Commission (“SEC”) on August 18, 2020. The offering will be made only by means of a written prospectus and prospectus supplement. A preliminary prospectus supplement and accompanying prospectus relating to the offering will be filed with the SEC and will be available on the SEC’s website at www.sec.gov. When available, copies of the preliminary prospectus supplement and accompanying prospectus may also be obtained from Morgan Stanley & Co. LLC, Attention: Prospectus Department, 180 Varick Street, 2nd Floor, New York, New York 10014, or by e-mail at [email protected] or Cowen and Company, LLC, c/o Broadridge Financial Solutions, Attn: Prospectus Department, 1155 Long Island Avenue, Edgewood, NY 11717, by telephone at (833) 297-2926 or by email at [email protected].

A copy of the press release issued in connection with the announcement is filed as Exhibit 99.2 to this Current Report on Form 8-K.

Neither this Current Report on Form 8-K nor the press release shall constitute an offer to sell nor the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. The offering may only be made by means of a prospectus supplement and related base prospectus.

This Current Report on Form 8-K and the related press releases contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainty. Such statements are based on management’s current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The Company cautions investors that there can be no assurance that actual results or business conditions will not differ materially from those projected or suggested in such forward-looking statements as a result of various factors. The words “believe,” “will,” “should,” “expect,” “intend,” “estimate,” “look forward” and “anticipate,” variations of such words and similar expressions identify forward-looking statements, but their absence does not mean that a statement is not a forward-looking statement. A further list and description of these and other factors, risks and uncertainties can be found in the Company’s most recent annual report, any subsequent quarterly and current reports, and certain other filings, filed with the SEC. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless required by law.

 

Item 9.01

Financial Statements and Exhibits

 

(d)

Exhibits.

 

99.1    Press Release of Alphatec Holdings, Inc., issued October 7, 2020
99.2    Press Release of Alphatec Holdings, Inc., issued October 13, 2020

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: October 13, 2020     ALPHATEC HOLDINGS, INC.
    By:  

/s/ Jeffrey G. Black

    Name:   Jeffrey G. Black
    Its:   Chief Financial Officer

Exhibit 99.1

 

LOGO

ATEC ANNOUNCES PRELIMINARY

THIRD QUARTER 2020 FINANCIAL RESULTS

 

  •  

Third quarter U.S. revenue expected to grow over 40%

 

  •  

Eighth consecutive quarter of double-digit revenue growth

 

  •  

Revenue per case expands on strong pull- through from SafeOp neuromonitoring and new product adoption

CARLSBAD, Calif., October 7, 2020 — Alphatec Holdings, Inc. (“ATEC” or the “Company”) (Nasdaq: ATEC), a medical device company dedicated to revolutionizing the approach to spine surgery, announced today preliminary, unaudited financial results for the third quarter ended September 30, 2020.

Preliminary, Unaudited Third Quarter 2020 Financial Results

Preliminary, unaudited third quarter 2020 results are expected to reflect U.S. revenue growth of 41% to 43% compared to third quarter 2019. Growth was driven primarily by the continuing rapid adoption of recently released ATEC technologies and strong pull-through from the SafeOp Neural InformatiX System. New product sales represented over 70% of estimated U.S. revenue for the quarter.

 

Quarter Ended September 30, 2020
(Unaudited)

Total revenue

    $40.7 million to $41.1 million

U.S. revenue

    $39.7 million to $40.0 million

U.S. gross margin

    71% to 73%

Operating loss

    $(12.0) million to $(13.5) million

Non-GAAP adjusted EBITDA

    $(1.7) million to $(2.2) million

At September 30, 2020, the Company had approximately $41 million in cash and available borrowings under its senior secured credit facility.

“In a year of considerable uncertainty, ATEC is bringing predictability to both the clinical experience and financial performance,” said Pat Miles, Chairman and Chief Executive Officer. “We continue to deliver against the priorities that we committed to early this year: creating clinical distinction, revitalizing the sales force, and compelling surgeon adoption. This team has created significant value by advancing surgical outcomes in spine before, and we are fully committed to doing it again.”

The Company expects to announce third quarter financial and operating results on November 5, 2020, after the market close. On that day, the Company will host a live webcast at 1:30 p.m. PT / 4:30 p.m. ET. The live webcast will be accessible via this link. An audiocast of the presentation will also be available domestically at (877) 556-5251 and internationally at (720) 545-0036. The conference ID number is 5178028.

A replay of the webcast will remain available on ATEC’s corporate website at www.atecspine.com until the Company releases fourth quarter financial results. In addition, a replay of the audiocast will be available until November 15, 2020. The replay dial-in numbers are (855) 859-2056 for domestic callers and (404) 537-3406 for international callers. Please use the replay conference ID number 5178028.

LOGO

 

About Alphatec Holdings, Inc.

Alphatec Holdings, Inc. (ATEC), through its wholly-owned subsidiaries, Alphatec Spine, Inc. and SafeOp Surgical, Inc., is a medical device company dedicated to revolutionizing the approach to spine surgery through clinical distinction. ATEC’s Organic Innovation Machine is focused on developing new approaches that integrate seamlessly with the SafeOp Neural InformatiX System to safely and reproducibly treat spine’s various pathologies and achieve the goals of spine surgery. Alphatec’s vision is to become the Standard Bearer in Spine. For more information, visit us at www.atecspine.com.

Financial Disclosure Advisory

The Company reports its financial results in accordance with U.S. generally accepted accounting principles. The expected financial results discussed in this press release are preliminary and represent the most current information available to the Company’s management, as financial closing procedures for the quarter ended September 30, 2020 are not yet complete. These estimates are not a comprehensive statement of the Company’s financial results for the quarter ended September 30, 2020 and actual results may differ materially from these estimates as a result of the completion of normal quarter-end accounting procedures and adjustments, including the execution of the Company’s internal control over financial reporting, the completion of the preparation and review of the Company’s financial statements for the quarter ended September 30, 2020 and the subsequent occurrence or identification of events prior to the formal issuance of the first quarter financial results.

Reconciliation of Non-GAAP Financial Measures

 

     Three Months Ended
September 30, 2020		  
     (preliminary, unaudited)  

(numbers in millions)

         

Operating loss, as reported

    $ (12.0 )       to      $ (13.5 ) 

Depreciation

      2.2        to        2.3  

Amortization of intangible assets

      0.4        to        0.4  
  

 

 

        

 

 

  

EBITDA

      (9.4 )       to        (10.8 ) 

Add back significant items:

         

Stock-based compensation

      4.2        to        4.5  

Litigation-related expenses

      1.7        to        1.9  

Excess & obsolete charges

      1.8        to        2.2  
  

 

 

        

 

 

  

Adjusted EBITDA

    $ (1.7 )       to      $ (2.2 ) 
  

 

 

        

 

 

  

To supplement the Company’s financial statements presented in accordance with U.S. generally accepted accounting principles (GAAP), the Company reports certain non-GAAP financial measures, including non-GAAP U.S. gross margin, non-GAAP operating expenses, non-GAAP operating loss, and non-GAAP Adjusted EBITDA. The Company believes that these non-GAAP financial measures provide investors with an additional tool for evaluating the Company’s core performance, which management uses in its own evaluation of continuing operating performance, and a baseline for assessing the future earnings potential of the Company. The Company’s non-GAAP financial measures may not provide information that is directly

LOGO

 

comparable to that provided by other companies in the Company’s industry, as other companies in the industry may calculate non-GAAP financial results differently, particularly related to non-recurring, unusual items. Non-GAAP financial results should be considered in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. Included below are reconciliations of the non-GAAP financial measures to the comparable GAAP financial measures.

Forward Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainty. Such statements are based on management’s current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The Company cautions investors that there can be no assurance that actual results will not differ materially from those projected or suggested in such forward-looking statements as a result of various factors. Forward-looking statements include references to the impact of the COVID-19 pandemic on the Company’s business and financial results, the Company’s ability to create clinical distinction, revitalize its sales force, compel surgeon adoption, and the Company’s expectations with respect to future revenue and growth. The important factors that could cause actual operating results to differ significantly from those expressed or implied by such forward-looking statements include, but are not limited to: changes to our financial results for the quarter ended September 30, 2020 due to the completion of financial closing procedures; the extent of the impact of COVID-19 pandemic on the Company’s business; the uncertainty of success in developing new products; failure to achieve acceptance of the Company’s products; failure to obtain FDA or other regulatory clearance or approval, or unexpected or prolonged delays in the process; continuation of favorable third party reimbursement; the Company’s ability to compete with other products and with emerging new technologies; product liability exposure, and other legal claims. The words “believe,” “will,” “should,” “expect,” “intend,” “estimate,” “look forward” and “anticipate,” variations of such words and similar expressions identify forward-looking statements, but their absence does not mean that a statement is not a forward-looking statement. A further list and description of these and other factors, risks and uncertainties can be found in the Company’s most recent annual report, and any subsequent quarterly and current reports, filed with the Securities and Exchange Commission. ATEC disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless required by law.

Investor/Media Contact:

Tina Jacobsen

Investor Relations

(760) 494-6790

[email protected]

Company Contact:

Jeff Black

Chief Financial Officer

Alphatec Holdings, Inc.

[email protected]

Exhibit 99.2

ATEC ANNOUNCES PROPOSED PUBLIC OFFERING OF COMMON STOCK

CARLSBAD, Calif., October 13, 2020 — Alphatec Holdings, Inc. (“ATEC”) (NASDAQ: ATEC), a provider of innovative spine surgery solutions dedicated to revolutionizing the approach to spine surgery, today announced that it has commenced an underwritten public offering of $85 million of shares of its common stock. In connection with the offering, ATEC intends to grant the underwriters a 30-day option to purchase up to an additional 15% of the number of shares of common stock sold in the offering. All of the shares in the offering are to be sold by ATEC. There can be no assurance as to whether or when the offering may be completed, or as to the actual size or terms of the offering.

Morgan Stanley and Cowen are acting as joint book-running managers in the offering. Canaccord Genuity LLC is acting as lead manager in the offering with Lake Street Capital Markets, LLC and Northland Capital Markets acting as co-managers.

The shares of common stock are being offered pursuant to a shelf registration statement on Form S-3 (File No. 333-241677) previously filed with and declared effective by the Securities and Exchange Commission. The offering will be made only by means of a written prospectus and prospectus supplement. A preliminary prospectus supplement and accompanying prospectus relating to the offering will be filed with the SEC and will be available on the SEC’s website at www.sec.gov. When available, copies of the preliminary prospectus supplement and accompanying prospectus may also be obtained from Morgan Stanley, Attention: Prospectus Department, 180 Varick Street, 2nd Floor, New York, New York 10014, or by e-mail at [email protected] or Cowen, c/o Broadridge Financial Solutions, Attn: Prospectus Department, 1155 Long Island Avenue, Edgewood, NY 11717, by telephone at (833) 297-2926 or by email at [email protected]. This press release shall not constitute an offer to sell nor the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction. The offering may only be made by means of a prospectus supplement and related base prospectus.

About ATEC

Alphatec Holdings, Inc. (ATEC), through its wholly-owned subsidiaries, Alphatec Spine, Inc. and SafeOp Surgical, Inc., is a medical device company dedicated to revolutionizing the approach to spine surgery through clinical distinction. ATEC’s Organic Innovation Machine is focused on developing new approaches that integrate seamlessly with the SafeOp Neural InformatiX System to safely and reproducibly treat spine’s various pathologies and achieve the goals of spine surgery. Alphatec’s vision is to become the Standard Bearer in Spine.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainty. Such statements are based on management’s current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. ATEC cautions investors that there can be no assurance that actual results or business conditions will not differ materially from those projected or suggested in such forward-looking statements as a result of various factors. The words “believe,” “will,” “should,” “expect,” “intend,” “estimate,” “look forward” and “anticipate,” variations of such words and similar expressions identify forward-looking statements, but their absence does not mean that a statement is not a forward-looking statement. A further list and description of these and other factors, risks and uncertainties can be found in ATEC’s most recent annual report, any subsequent quarterly and current reports, and certain other filings, filed with the Securities and Exchange Commission. ATEC disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless required by law.

Company Contact:

Jeff Black

Chief Financial Officer

[email protected]

Investor/Media Contact:

Tina Jacobsen

Investor Relations

(760) 494-6790

[email protected]