Veracyte, Inc 8-K/A, filed Apr 17, 2024

Veracyte, Inc. (VCYT)

8-K/A 2024-04-17 For: 2024-02-05

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Added on April 11, 2026

About this 8-K/A

Veracyte, Inc filed this 8-K/A on April 17, 2024, reporting on events of February 5, 2024.

Items reported

Item 9.01: Financial statements and exhibits

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6000 Shoreline Court, Suite 300, South San Francisco, California						94080
(Address of principal executive offices)						(Zip Code)


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 240.14a-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))


Exhibit No.						Description

23.1						Consent of Kost Forer Gabbay & Kasierer, a member of EY Global , Indepe ndent Auditors of C2i Genomics .
99.1						Audited financial statements of C2i Genomics as of and for the year ended December 31, 2023.
99.2						Unaudited pro forma condensed combined financial statements of Veracyte as of and for the year ended December 31, 2023.
104						Cover Page Interactive Data File (embedded within the Inline XBRL document).


Dated:	April 17, 2024

		VERACYTE, INC.

		By:	/s/ Rebecca Chambers
		Name:	Rebecca Chambers
		Title:	Chief Financial Officer
			Principal Financial Officer


Tel Aviv, Israel			KOST FORER GABBAY & KASIERER
April 16, 2024			A Member of EY Global


Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
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. ☐


			Page

Report of Independent Auditors			2-3

Consolidated Balance Sheet			4

Consolidated Statement of Operations			5

Consolidated Statement of Changes in Convertible Preferred Stocks and Stockholders' Equity (Deficiency)			6

Consolidated Statement of Cash Flows			7

Notes to Consolidated Financial Statements			8 – 28


	December 31
	2023
ASSETS

CURRENT ASSETS
Cash and cash equivalents	$	18,804
Accounts receivable	6
Prepaid expenses and other current assets	519

Total current assets	19,329

LONG-TERM ASSETS
Property and equipment, net	412
Right of Use Asset - Operating leases	1,244
Restricted deposits for leases	188

Total assets	$	21,173

LIABILITIES, CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIENCY)
CURRENT LIABILITIES
Trade payables	$	757
Payroll and benefit related liabilities	1,356
Other accounts payable	998
Deferred revenue	94
Current portion of lease liabilities	685

Total current liabilities	3,890

LONG-TERM LIABILITIES
Lease liabilities	841
Convertible promissory notes	78,568

Total long-term liabilities	79,409

Total Liabilities	83,299

COMMITMENT AND CONTINGENT LIABILITIES (Note 9)
CONVERTIBLE PREFERRED STOCKS
Convertible Preferred Seed stock of $0.001 par value - Authorized, Issued and outstanding: 4,301,075 shares	1,171
Convertible Preferred A stock of $0.001 par value - Authorized, Issued and outstanding: 13,952,268 shares	11,914
	13,085
STOCKHOLDERS' EQUITY (DEFICIENCY):
Share capital -
Common stocks of $0.001 par value - Authorized: 35,000,000, Issued and outstanding: 10,348,357 stocks at December 31, 2023	10
Additional paid-in capital	854
Accumulated deficit	(76,075)

Total stockholders' deficit	(75,211)

Total liabilities, convertible preferred stock and shareholders' equity	$	21,173


	Year ended December 31,
	2023

Revenues	$	456

Cost of revenues	133

Gross profit	323

Operating expenses:

Research and development	17,880

Sales and marketing	2,039

General and administrative	2,352

Total operating expenses	22,271

Operating loss	21,948

Financial expenses, net	13,898

Loss before income taxes	35,846

Income taxes	154

Net loss	$	36,000


	Convertible Preferred Seed stocks			Convertible Preferred A stocks			Common stocks			Additional paid-in			Accumulated			Total stockholders’ equity (deficiency)
	Shares	Amount		Shares	Amount		Shares	Amount			capital			deficit

Balance as of January 1, 2023	4,301,075	$	1,171	13,952,268	$	11,914	10,181,638	$	10		$	574		$	(40,075)	$	(39,491)

Share-based compensation expenses	—	—		—	—		—	—			236			—		236
Exercise of stock options	—	—		—	—		166,719	*)			44			—		44
Net loss	—	—		—	—		—	—			—			(36,000)		(36,000)

Balance as of December 31, 2023	4,301,075	$	1,171	13,952,268	$	11,914	10,348,357	$	10		$	854		$	(76,075)	$	(75,211)


	Year ended December 31,
	2023

Cash flows from operating activities:
Net Loss	$	(36,000)
Adjustments to reconcile net loss to net cash used in operating activities:

Depreciation and amortization	567
Gain on disposal of equipment	(17)
Stock based compensation expenses	236
Change in fair value of convertible notes	14,649
Issuance expenses of convertible promissory note	10
Foreign currency transaction differences on cash and cash equivalents	152
Increase in restricted deposits for leases	(188)
Increase in accounts receivable	(6)
Decrease in prepaid expenses and other current assets	32
Increase in operating right of use asset	(1,244)
Increase in trade payables	101
Increase in payroll and benefit related liabilities	49
Increase in other accounts payable	87
Increase in operating lease liability, net	1,381

	15,809

Net cash used in operating activities	(20,191)

Cash flows from investing activities:
Purchase of property and equipment	(81)
Proceeds from disposal of equipment	24

Net cash used in investing activities	(57)

Cash flows from financing activities:
Repayment of finance lease liability	(278)
Proceeds from issuance of Convertible promissory note, net	21,115
Proceeds from exercise of options	44

Net cash provided by financing activities	20,881

Effect of exchange rates on cash and cash equivalents	(152)

Increase in cash and cash equivalents	481
Cash and cash equivalents at beginning of period	18,323

Cash and cash equivalents at end of period	$	18,804


			%
Computers and peripheral equipment			15 - 33
Lab equipment			33
Leasehold improvements			Over the shorter of the term of the lease or useful life of the assets


						Year ended December 31,
						2023

Average expected term (in years)						6.25
Risk free interest rate						3.94%-4.75%
Volatility						60%-78%
Dividend yield						0%


						Year ended December 31,
						2023

Time to maturity (years)						0.25
Risk free interest rate						5.40%
Volatility						99%


Balance at January 1, 2023	$	42,795
Additions	21,125
Change in fair value	14,649

Balance at December 31, 2023	$	78,569


CONSOLIDATED BALANCE SHEET


CONSOLIDATED STATEMENT OF OPERATIONS


CONSOLIDATED STATEMENT OF CASH FLOWS


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


	December 31, 2023
	Level 1		Level 2		Level 3		Total

Financial assets:
Cash equivalent - Money market funds and treasury bills	$	17,263	$	—	$	—	$	17,263

Total financial assets	$	17,263	$	—	$	—	$	17,263

Financial liabilities:
Convertible promissory notes	$	—	$	—	$	78,568	$	78,568

Total financial liabilities	$	—	$	—	$	78,568	$	78,568


	December 31,
	2023

Government authorities	$	165
Prepaid expenses	306
Other current assets	48

	$	519


	December 31,
	2023
Cost:

Computers and peripheral equipment	$	163
Lab equipment	888
Finance lease lab equipment	1,061
Leasehold improvements	31

	2,143

Accumulated depreciation	1,731

Property and equipment, net	$	412


	December 31,
	2023

Operating lease costs	$	1,400
Finance lease costs
Depreciation of finance lease lab equipment	354
Interest on lease liabilities	20
Sublease income	(53)

Total lease costs	$	1,720


	December 31, 2023

Right-of-use asset – operating leases	$	1,244
Finance lease lab equipment	$	118

Operating lease liability, current	540
Operating lease liability, long term	841
Finance lease liability, current	144
Finance lease liability, long term	—

Total operating lease liabilities	$	1,381
Total finance lease liabilities	$	144


						December 31, 2023

2024						146

Total undiscounted lease payments						146
Less imputed interest						(2)

Net present value of future minimum lease payments						144

Weighted average of remaining finance lease term (in years)						—
Weighted average of finance lease discount rate						5%


						December 31, 2023

2024						703
2025						593
2026						354

Total undiscounted lease payments						1,650
Less imputed interest						(269)

Net present value of future minimum lease payments						1,381

Weighted average of remaining operating lease term (in years)						2.43
Weighted average of operating lease discount rate						14.33%


	December 31, 2023
	Number of stocks Authorized	Number of stocks issued and outstanding

Common Stock of $0.001 par value each	35,000,000	10,348,357
Convertible Preferred Seed Stock of $0.001 par value each	4,301,075	4,301,075
Convertible Preferred Series A Stock of $0.001 par value each	13,952,268	13,952,268


	Year ended December 31, 2023
	Number of options	Weighted-average exercise price	Weighted- average remaining contractual term (in years)

Outstanding at January 1, 2023	3,473,106	$0.53	8.22
Granted	205,000	$0.73	3.48
Forfeited	(763,094)	$0.69	8.26
Exercised	(166,720)	$0.27	7.08

Outstanding at December 31, 2023	2,748,292	$0.52	7.27

Options exercisable at the end of the year	1,791,341	$0.46	6.99


	Year ended December 31,
	2023

Interest income	$	(978)
Interest on finance leases	20
CPN fair value adjustments	14,649
Foreign currency transaction differences, net	207

Financial expenses, net	$	13,898


	December 31,
	2023

Domestic	$	36,336
Foreign	(490)

Total net loss	$	35,846


	December 31,
	2023
Current:
Domestic	$	—
Foreign	154
Total current income tax expense	154

Deferred:
Domestic	—
Foreign	—
Total deferred income tax expense	—

Total current income tax expense	$	154


	December 31,
	2023

Deferred tax assets:

Net operating loss carryforwards	$	12,489
R&D capitalization and amortization	5,359
Provision for bonuses	149
Provision for vacation and recuperation	112
Lease liabilities	323

Total deferred tax assets before valuation allowance	18,432
Valuation allowance	(18,143)

Deferred tax asset	289

Deferred tax liabilities:
Right-of-use assets	289

Deferred tax liabilities	289

Deferred tax assets, net	$	—


	Veracyte December 31, 2023		C2i December 31, 2023(1)		Transaction accounting adjustments		Notes	Pro forma
ASSETS
Current assets
Cash and cash equivalents	$	216,454	$	18,804	$	(11,994)	3(A)	$	223,264
Accounts receivable	40,378		6		—			40,384
Supplies and inventory	16,128		—		—			16,128
Prepaid expenses and other current assets	12,661		519		—			13,180
Total current assets	285,621		19,329		(11,994)			292,956
Property and equipment, net	20,584		412		—			20,996
Right-of-use assets - operating leases	10,277		1,244		—			11,521
Intangible assets, net	88,593		—		31,500		3(B)	120,093
Goodwill	702,984		—		53,003		3	755,987
Restricted cash	876		—		—			876
Other assets	5,971		188		—			6,159
Total assets	$	1,114,906	$	21,173	$	72,509		$	1,208,588
LIABILITIES AND EQUITY
Current liabilities
Accounts payable	$	12,943	$	757	$	—		$	13,700
Accrued liabilities	38,427		2,332		—			40,759
Current portion of deferred revenue	2,008		94		—			2,102
Current portion of acquisition-related contingent consideration	2,657		—		4,279		3(C)	6,936
Current portion of operating lease liabilities	5,105		541		—			5,646
Current portion of other liabilities	101		166		—			267
Total current liabilities	61,241		3,890		4,279			69,410
Deferred tax liability	734		—		750		3(D)	1,484
Acquisition-related contingent consideration, net of current portion	518		—		12,921		3(C)	13,439
Operating lease liabilities, net of current portion	7,525		841		—			8,366
Other liabilities	786		78,568		(78,568)		3(E)	786
Total liabilities	70,804		83,299		(60,618)			93,485
Commitments and contingencies
Stockholders’ equity
Preferred stock, $0.001 par value; 5,000,000 shares authorized, no shares issued and outstanding as of December 31, 2023, and 2022	—		13,085		(13,085)		4(A)	—


Common stock, $0.001 par value; 125,000,000 shares authorized, 73,264,738 and 71,959,454 shares issued and outstanding as of December 31, 2023, and 2022, respectively	73		10		(7)		4(A)	76
Additional paid-in capital	1,536,168		854		73,378		4(A)	1,610,400
Accumulated deficit	(468,121)		(76,075)		72,841		4(A)	(471,355)
Accumulated other comprehensive loss	(24,018)		—		—			(24,018)
Total stockholders’ equity	1,044,102		(62,126)		133,127			1,115,103
Total liabilities and stockholders’ equity	$	1,114,906	$	21,173	$	72,509		$	1,208,588


	Veracyte Year ended December 31, 2023		C2i Year ended December 31, 2023(1)		Transaction accounting adjustments		Notes	Pro forma
Revenue
Testing revenue	$	326,542	$	456	$	(300)	4(B)	$	326,698
Product revenue	15,588		—		—			15,588
Biopharmaceutical and other revenue	18,921		—		—			18,921
Total revenue	361,051		456		(300)			361,207
Operating expenses:
Cost of testing revenue	88,913		133		—			89,046
Cost of product revenue	8,666		—		—			8,666
Cost of biopharmaceutical and other revenue	15,324		—		—			15,324
Research and development	57,305		17,880		(212)		4(C)	74,973
Selling and marketing	101,490		2,039		—			103,529
General and administrative	86,229		2,352		3,216		4(D)	91,797
Impairment of long-lived assets	68,349		—		—			68,349
Intangible asset amortization	20,570		—		1,687		3(B)	22,257
Total operating expenses	446,846		22,404		4,691			473,941
Loss from operations	(85,795)		(21,948)		(4,991)			(112,734)
Other income, net	9,183		(13,898)		—			(4,715)
Loss before income tax benefit	(76,612)		(35,846)		(4,991)			(117,449)
Income tax provision (benefit)	(2,208)		154		(1,048)		4(E)	(3,102)
Net loss	$	(74,404)	$	(36,000)	$	(3,943)		$	(114,347)

Net loss per common share:
Basic	$	(1.02)						$	(1.52)
Diluted	$	(1.02)						$	(1.52)

Shares used to compute net loss per common share:
Basic	72,644,487				2,698,349		5(B)	75,342,836
Diluted	72,644,487				2,769,526		5(C)	75,414,013


UNAUDITED C2I CONDENSED BALANCE SHEET AS OF DECEMBER 31, 2023 (in thousands)
	C2i Year ended December 31, 2023		Reclassification adjustments(1)		Total
ASSETS
Current assets:
Cash and cash equivalents	$	18,804	$	—	$	18,804
Accounts receivable	6		—		6
Prepaid expenses and other current assets	519		—		519
Total current assets	19,329		—		19,329
Property, plant and equipment, net	412		—		412
Right of use asset – operating leases	1,244		—		1,244
Restricted deposits for leases	188		(188)		—
Other assets	—		188		188
Total assets	$	21,173	$	—	$	21,173

LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIENCY)
Current liabilities:
Trade payables	$	757	$	—	$	757
Payroll and benefit related liabilities	1,356		(1,356)		—
Other accounts payable	998		(998)		—
Accrued liabilities	—		2,332		2,332
Deferred revenue	94		—		94
Current portion of lease liabilities	685		(144)		541
Current portion of other liabilities	—		166		166
Total current liabilities	3,890		—		3,890
Lease liabilities	841		—		841
Convertible promissory notes	78,568		(78,568)		—
Other liabilities	—		78,568		78,568
Total liabilities	83,299		—		83,299
Mezzanine equity:
Preferred Seed stock of $0.001 par value - Authorized, Issued and outstanding: 4,301,075 shares	1,171		—		1,171
Preferred A stock of $0.001 par value - Authorized, Issued and outstanding: 13,952,268 shares	11,914		—		11,914
Stockholders' equity (deficiency):
Share capital - Common stocks of $0.001 par value - Authorized: 35,000,000, Issued and outstanding: 10,348,357 stocks at December 31, 2023	10		—		10
Additional paid-in capital	854		—		854
Accumulated deficit	(76,075)		—		(76,075)
Total Stockholders' equity (deficiency)	(75,211)		—		(75,211)
Total liabilities, mezzanine equity and stockholders' equity	$	21,173	$	—	$	21,173


UNAUDITED C2I CONDENSED STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2023 (in thousands)
	C2i Year ended December 31, 2023		Reclassification Adjustments(1)		Total
Revenues	$	456	$	—	$	456
Cost of revenues	133		—		133
Gross profit	323		—		323
Operating expenses:			—
Research and development expenses	17,880		—		17,880
Marketing expenses	2,039		—		2,039
General and administrative expenses	2,352		—		2,352
Total operating expenses	22,271		—		22,271
Financial expenses (income), net	13,898		(13,898)		—
Other income, net	—		13,898		13,898
Income taxes	154		—		154
Net income	$	(36,000)	$	—	$	(36,000)


Closing consideration as per closing statement	Amounts (in thousands)
Upfront Payment	$	70,000
Plus: Closing cash(1)	13,689
Less: C2i debt (1)	(1,398)
Less: C2i transaction expenses (1)	(17)
Plus: Net working capital adjustment(1)	1,042
Less: Note closing amounts(1)	(49,743)
Closing consideration as per closing statement	$	33,573


Purchase price for accounting purposes	Amounts (in thousands)
Closing consideration as per closing statement (from above)	$	33,573
Add: Fair value of contingent consideration	17,200
Add: Note closing amounts	49,743
Add: C2i transaction expenses settled by Veracyte	17
Less: Unvested portion of settlement of options	(338)
Purchase price for accounting purposes	$	100,195