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Are our filings some version of this:
WHAT IT IS:
Blank check preferred stock refers to the issuance of a class of preferred shares where the board of directors has authority determining voting rights, dividends, and conversion without separate shareholder approval.
HOW IT WORKS (EXAMPLE):
The most common reason a company will issue blank check preferred stock is to create a "poison pill" whereby the rights associated with the stock make a takeover unattractive.
In order to issue this type of stock, a company will normally have to amend its articles of incorporation Then the board of directors will issue the shares, using its power over the voting, conversion, dividends, and other rights to create a share class that meets its needs.
For example, the board of Company XYZ may issue a blank check preferred stock that can be converted to common shares if a working capital is proposed, creating a higher expense for the company to be bought.
WHY IT MATTERS:
Blank check preferred stock can act as a safety mechanism from unwanted takeovers. As well, companies can use the blank check preferred stock to quickly raise capital without awaiting shareholder approval. However, given the powers that must be entrusted to the board of directors in order to issue the shares, investors should carefully monitor when and for what reason blank check preferred shares are issued.
http://www.investinganswers.com/financial-dictionary/stock-market/blank-check-preferred-stock-747
Agreed,
I enjoy looking through the amedica website from time to time. Its very good.. the powerful narratives of biomaterial revolution are very well presented. Regardless of the shakes and shimmies of investing, the branding effort of Amedica and silicon nitride, the base of research and ipr+d has been sustained, and its impressive. I personally don't think the Amedica brand will disappear anytime soon, but instead will anchor broader, ongoing development of this material platform moving forward--regardless of who owns it. Thats just guesswork on my part. Meanwhile, the line-up of spine implants, and development in hip, knee, and dental, have (as we know) abundant value that will hopefully unfold soon to shareholder advantage...
glta
RE, my tea leaves have not been workin, but regarding news, I do like the line up of company PRs from recent months; the Patent, and FDA approval are both major league hits that confirm core amda narratives. So many pieces in place at this point..
glta
I wasn't referring to that agreement but to your comments with IR at the time.
Boston,
your gleanings from 2015 sound like there was some unhappiness with being a publicly traded company--when that is what they are, piggy-backing shareholders and all. Perhaps there were conflicting views around the IPO or taking it private, etc. Anyway, I would be really interested in knowing more about current shareholders as a group--but this info isn't forthcoming. Cl101 has emphasized the ongoing polishing/cleaning/symplifying process of finances, warrants, loans, etc, so it doesn't quite follow that the company would issue a new class of preferreds plus warrants unless it was a strategic necessity. These filings, nevertheless, do, maintain a substantial wall of uncertainty...
glta
Why did I know you were going to say that Boston? Thanks for weighing in-- you called it right so far...
(thanks Peeteman too). I'm still skeptical.
glta
Good question Boston. Is this a poison pill initiative? Hard to believe that interested parties aren't taking a very close look at this technology and planning or making moves. Reduced chance of infection? Reduced reliance on failing antibiotics? Reduced chance of implant failure? Reduced chance of lawsuit? No doubt plenty of eyes on this company. The story conveyed here is strong and backed by solid research--thanks S bal, and team. So this dilution however..defending the castle or stealing the treasure?
glta
interesting insights Peeteman. no doubt these filings send far ranging signals. Why the shift from shareholder rights to public offering? Lots at stake here for both small retail investors and aggressive take-over specialists... are these filings generated by greedy share grabbers or loyal defenders of the castle??
glta
New S-1/a filing has upped the estimated dilution of converted shares from approximately 18m fully converted to approximately 21 million. Could still adjust further.
Is this a take-over deterrent as CL101 suggested, or simply a massive share grab? Omid, opinions?
glta.
I have difficulty sorting this into something meaningful to my perspective, but thank you!
glta
HI Xena, any interpretive insight to these numbers?
glta
RationalE, thats what I see. If this S-1 goes into effect, I believe your dilution estimates are in the ballpark. I guess its also possible, like the earlier shareholder rights offer, that it never goes into effect and is just a way of fostering additional uncertainty and consternation, and further shaking of the tree for shares. For the moment it is continued uncertainty.
glta
Boston, it might not be about needing money at all--just cheap share grab.
The cheaper the shares, the bigger the percentage of the company gets purchased in a dilutive offering like this. Its all about controlling issued shares and controlling percentages of the total imo. 1500 shares per invested thousand dollars, more or less, is what is being proposed--but no longer offered to all existing shareholders. A question I have is where the 20% limits of ownership kick in, if at all, or other provisions that presume to protect the current shareholder interests.
glta
Second S-1/A filing:
https://www.nasdaq.com/symbol/amda/sec-filings
"EXPLANATORY NOTE
This Amendment No. 2 to the Registration Statement on Form S-1 (File No. 333-223032) of Amedica Corporation is being filed solely for the purpose of filing Exhibits 4.29 and 5.1 and a revised version of Exhibit 1.1, and amending the Exhibit Index. Other than new and revised exhibits and the Exhibit Index, the remainder of the Registration Statement is unchanged."
glta
I've got to hand it to you Boston, you did say "Ill believe it when I see it" and now the s-1 shareholders rights offer has been revealed as a head fake. Will this S-I/A follow through? Hard to say but good for you calling it like you see it. I agree its weird to transform a shareholders rights offer into this latest S-1/A filing. How does the SEC make sense of this-- if they are actually doing their jobs and considering shareholder interests
and monitoring the potential for undermining those interests by insider games?
glta
Excerpt from the S-1:
The Offering
Securities to be offered
12,500 units, each unit consisting of one share of our Series B Preferred Stock and Warrants to purchase shares of our Common Stock at an initial exercise price equal to the Conversion Price (as defined herein), at a public offering price of?$1,000 per unit. Each Warrant entitles the holder to purchase one share of our Common Stock. Assuming a Conversion Price of $1.38 per share, the closing price of our Common Stock on the NASDAQ Capital Market on April 24, 2018, each unit shall consist of one share of our Series B Preferred Stock convertible into 797 shares of Common Stock and 797 Warrants, each of which entitles the holder to purchase one share of our Common Stock.
==================================================
Not sure how this plays out, but potentially adds up to major dilution: .
(797+797)x12,500=19,925,000 shares when fully converted from preferred and warrants.
No share holders rights like previous s-1 proposed offering.
Conversion price is 1.38, or might possibly see further downward adjustment if sp drops.
glta
Hi rational exuberance, all
http://investor.zimmerbiomet.com/news-and-events/news/2014/24-04-2014-192215025
above is the link to Zimmer's pr for 1st quarter 2014 results. Business as usual, but same day as the announcement for Biomet merger...
http://www.prnewswire.com/news-releases/zimmer-holdings-inc-to-combine-with-biomet-inc-in-transaction-valued-at-1335-billion-256503501.html
Could be interesting day tomorrow if we've been reading the calendar correctly. No matter what, AMDA is a gem being polished and polished (as cl and boston have so effectively demonstrated). If not tomorrow, then soon imo. The opportunity cost for not moving on this technology with a major sales team and focused r&d will begin rapidly mounting. The Amedica website is effectively telling the story of a superior biomaterial platform who's time has come. I think you are right that the timing question is all on Zimmer now. Imho.
glta
Hi Boston,
IPRandD valuation applied to a bio-material platform is indeed interesting to consider. Not this or that product, but wide, wide, application driven by remarkable and highly differentiating properties. But you know this better than anyone..
Thank you for your sustained research efforts.
glta
Good exchange Omid and Boston.
I've also been wondering if continued buying is the right move, or if holding back resources for the Rights Offering is necessary (and been doing some of each). S-1/a and Effect filings could arrive quickly. However, uncertainty appears to be built into story at this point. The S-1 could, for example, proceed--but then be cancelled at the 11th hour...or not. Go figure.
glta
Very Nice Boston!
Below is some info on FDA predicate device issues:
http://www.duvalfdalaw.com/documents/client-alerts/choosing-the-proper-predicate-devices-comparing-apples-to-oranges.pdf
"EXECUTIVE SUMMARY
One of the key choices for staying on the premarket notification (“510(k)”) pathway is
choosing the right predicate device(s). In 2011, FDA conducted a review of its “Not
Substantially Equivalent” (“NSE”) determinations from 2005-2010 and found that lack
of a “suitable predicate” was one of the top four reasons for NSE determinations.1 As
you know, a 510(k) needs to demonstrate that the new device to be marketed is
“substantially equivalent” to a legally marketed device (“predicate device”). To be
declared “substantially equivalent,” the new device must have (1) the same intended
use as the predicate device, and (2) the same technological characteristics as the
predicate device or (b) have different technological characteristics but show that the
differences do not raise different questions of safety and effectiveness from the
predicate device. Choosing the right predicate device is one of the (if not the) most
important components in a 510(k) strategy; choosing incorrectly can mean that more
time, effort and resources are needed to clear your device, and moreover, it can put
your clearance at risk. "
Boston, no it did not. I wish it had, but Authorized sharecount is not reduced with RS unless that is explicitly stated, and it was not. (my understanding) Therefore, tons of room for issuing more.
glta
This appears to be a very far reaching patent. Great news and timing!
glta
3 ways the medical device industry could evolve in 2018
January 8, 2018 By Chris Newmarker
www.medicaldesignandoutsourcing.com/ey-medtech-trends-2018/
Continued M&A, investment in long-term innovation, transforming business models – those are some of the ways the medical device industry could evolve this year, according to Jeff Greene, EY’s global life sciences transaction advisory services leader.
EY today released its 2017 M&A Firepower Report: Life sciences deals and data, which analyzes three life sciences subsectors: biopharma, biotechnology and medical devices. The report’s biggest overall prediction for 2018 involves a surge in mergers and acquisitions (M&A) by life sciences companies, with the total value of deals once again surpassing $200 billion.
Here are the three things that especially stuck out to Greene when it comes to the medical device industry:
1. M&A isn’t going away.
There have been so many huge medical device companies merging in recent years: Medtronic and Covidien, Abbott and St. Jude Medical, Zimmer and Biomet, to name a few. That means there isn’t a lot of fodder left for big deals, according to Greene. But the incentives for medtech M&A are still there, because hospitals are merging, healthcare payment models are changing, and there’s pricing pressure on medical device products.
“We look for continued M&A in the sector, including in the medium-sized space,” Greene said.
2. More investment in long-term R&D
The business-friendly environment – especially in the U.S. (e.g. the new tax laws, the Trump administration’s slashing of regulations and other business-friendly moves) – should give medical device companies more room financially to invest in research and boost innovation over the long-term, Greene said.
“Innovation is going to continue, even accelerate, as companies have more confidence and a positive outlook,” Greene said.
3. Continued evolution toward new business models
The shift, especially in the U.S., toward value-based healthcare means that medical device companies are increasingly seeking out service-based models. Expect that trend to continue in 2018, according to Greene.
Look out for some unexpected partnerships and acquisitions. In the same vein as CVS’s planned acquisition of Aetna or UnitedHealth’s plans to buy DaVita, medical device companies may seek to buy health providers, for example.
“We talk of biopharma companies needing to thing beyond the pill,” Greene said “I think medical device companies have been better at thinking about services beyond their products.”
https://www.medicaldesignandoutsourcing.com/ey-medtech-trends-2018/
Rights offering info
fwiw
glta
Hi Boston, My understanding is that the SEC tries to respond to S-1 filings in one month--as I posted earlier. Week 5 since Feb 14 filing just ended. Not random, perhaps affected by SEC backlog. Guesswork, yes, random, no. Fwiw.
glta
I was expecting an S-1/A filing this week... Maybe next.
glta
Zimmer announced Biomet merger on April 24, 2014. The morning of first quarter conference call.
Fwiw.
zimmer-holdings-inc-to-combine-with-biomet-inc
glta
xena, thanks for reposting that quote, and thanks to Boston for writing (and researching) it in the first place.
glta
Bravo!
glta
JayDan, I found the date strange... so I cut and pasted the statement as I found it (see quotation marks). Either a mistake or delay until May for 4Q2017. Also why I noted "fwiw" It was pop-up data on Schwab account site--so no link.
glta
"Fourth Quarter Earnings Announcement Expected: Earnings will tentatively be announced 05/15/2018. With 2 analysts covering AMDA, the consensus EPS estimate is -$0.67, and the high and low estimates are -$0.58 and -$0.75, respectively.
Expected Timing: Before market open
The data was gathered by Wall Street Horizon, but it is still considered tentative."
fwiw
glta
Also why AMDA going global all alone is not an appealing option. Its not just a salesperson trying to catch the attention of a surgeon but "teams talking to teams" risk managers, lawyers, hospital management, value added specialists, surgeons etc on a VAT team. A considerable depth of sales support needed to drive a new material platform like Si3N4 forward. I'm confident amda is fully aware of this.
Si3N4 does "differentiate" itself as called for in this article.
glta
Good read on implant sales and hospital implant purchasing by John B. Pracyk, M.D., Ph.D., Global Franchise Medical Director at DePuy Synthes Spine originally wrote on this topic for ORTHOWORLD in October 2014. Reposted on OrthoWorld site, Feb 21, 2018:
https://www.orthoworld.com/index.php/publications/orthoknow_content/surgeon-leadership-essential-to-influence-implant-purchasing-comm-1
excerpts:
"Purchasing decisions at the hospital and surgery center level continue to be driven by the clinical and economic value that products create for their systems. This means that product adoption will take teams of teams—suppliers and service providers to device companies included—to meet today’s demands."
"The traditional sales model involved a close relationship between the medical device sales representative and the surgeon. That relationship no longer drives purchasing decisions, as VATs decide the selection of implants from which the surgeon may choose. This formalized process serves as a checkpoint to prevent the surgeon from simply selecting a device based on personal preference, because that decision-making usually costs the hospital in the end. The latest device often commands the highest price, as manufacturers try to increase their production numbers through price increases each and every year."
Expectations and responsibilities placed upon surgeons are now even greater. If surgeons want to trial a new product, they need to be able to cite the implant’s clinical benefits, along with the economic value that it delivers. Is the product any different than others that are already “on contract” with the hospital? The preference product runs the risk of being commoditized—evaluated on price alone—if it lacks a unique differentiating factor.
"Each implant should have a balance among clinical effectiveness, quality, durability and intrinsic value. Surgeons are being approached by sales representatives to help develop a “value proposition” for a particular device. Forward-thinking manufacturers already develop return on investment (ROI) analytics for larger capital purchases like MRI and CT scanners. These clearly illustrate how the product can either enhance hospital revenue or save the healthcare system money, while simultaneously improving clinical outcomes for the patient. These ROI analytics are becoming more commonplace for surgical device implants."
glta
Hondo,
very hard to read at this point. Not worth too much guessing imo since some answers will likely appear soon. My understanding, however, is that this kind of offering is very flexible, adjustable, as well as cancellable. I think it will have to move quickly after this initial, slow, exchange with SEC. I don't think the recent warrants will really have much impact on how the rights offering proceeds.
glta
I'm anticipating an amendment filing to the S-1 this week or next...
"Following the filing of an S-1 Registration Statement, the SEC completes its review and sends comments to the company regarding the disclosures, The company is then required to file an amendment to the initial S-1 Registration Statement, that includes a response letter to the SEC’s comments. The SEC will then review the amended Registration Statement and response letter and will furnish the company with additional comments if necessary. This can be a lengthy process which can continue until the SEC is satisfied that its disclosure requirements are fulfilled.
SEC response times to the registration statement vary depending on a number of factors including the complexity of the specific filing and state of the market at the time of the filing, among other factors. However, the SEC has reported that its goal is to respond to the initial Registration Statement within 4 weeks. Once the SEC declares the Form S-1 effective, the company can complete its going public transaction by filing a Form 211 with FINRA to seek a stock ticker symbol. Unlike a registration statement on Form 10, Form S-1 creates unrestricted shares. As such, with the proper structure, the Company can meet FINRA’s requirements. Companies not qualifying for a stock exchange often elect to go public on the OTC Markets OTCQB or OTCQX."
excerpt from:
https://www.securitieslawyer101.com/2015/sec-review-form-s-1-registration-statement/
glta
amda press release, Rationalexuberance--nice psychic ability!
https://investors.amedica.com/press-releases/detail/115
Thank you RE. I've also enjoyed looking back in the p.r. record-- to when amda was more forthcoming with information.
glta
Excellent read! Thanks for posting these case studies.
glta
Good to know, I haven't been following ZB past years..
glta
Quote from zimmer-biomet 10-k:
p.32
"We believe long-term indicators point toward sustained growth driven by an aging global population, growth in emerging markets, obesity, proven clinical benefits, new material technologies, advances in surgical techniques and more active lifestyles, among other factors. In addition, demand for clinically proven premium products and patient specific devices are expected to continue to positively affect sales growth in markets that recognize the value of these advanced technologies. "
http://otp.investis.com/clients/us/zimmer_biomet/SEC/sec-show.aspx?Type=html&FilingId=12584943&Cik=0001136869#ZBH-10K_20171231_HTM_ITEM_7_MANAGEMENTS_DISCUSSION_ANALYSIS_F