0001305773FALSE00013057732023-08-022023-08-02



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): August 2, 2023
Conformis, Inc.
(Exact Name of Company as Specified in Charter)
 
Delaware001-3747456-2463152
(State or Other Jurisdiction
of Incorporation)		(Commission
File Number)		(IRS Employer
Identification No.)

600 Technology Park Drive
Billerica, MA 01821
(Address of Principal Executive Offices) (Zip Code)

Company’s telephone number, including area code: (781) 345-9001

(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 (see General Instruction A.2. below):
☐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))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbol(s)Name of each exchange on which registered
Common Stock, $0.00001 par value per shareCFMSThe Nasdaq Capital 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 May 8, 2023, Conformis, Inc. issued a press release announcing its financial results for the quarter ended December 31, 2022. A copy of such press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference in its entirety.

The information furnished under this Item 2.02, including the press release attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act, except as otherwise expressly stated in such filing.

Cautionary Statement Regarding Forward-Looking Statements

Statements in this Current Report on Form 8-K about the Company’s future expectations, plans and prospects, including statements about the impact of the COVID-19 pandemic and the Company’s financial position and results, total revenue, product revenue, gross margin, operations and growth, as well as other statements containing the words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” or “would” or the negative of these terms or other and similar expressions are intended to identify forward-looking statements within the meaning of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995, although not all forward-looking statements contain these identifying words. The Company may not actually achieve the expectations disclosed in these forward-looking statements, and you should not place undue reliance on these forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements the Company makes as a result of a variety of risks and uncertainties, including risks related to the COVID-19 pandemic and the response to the pandemic; risks related to the Company’s estimates and expectations regarding the Company’s revenue, gross margin, expenses, revenue growth and other results of operations, and the other risks and uncertainties described in the “Risk Factors” sections of the Company’s public filings with the U.S. Securities and Exchange Commission. In addition, the forward-looking statements included in this Current Report on Form 8-K represent the Company’s views as of the date hereof. The Company anticipates that subsequent events and developments may cause the Company’s views to change. However, while the Company may elect to update these forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Company’s views as of any date subsequent to the date hereof.

Item 9.01
Financial Statements and Exhibits.
(d)
Exhibits.




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.
CONFORMIS, INC.
Date: August 2, 2023
By:
/s/ Christine Desrochers
Christine Desrochers
Chief Financial Officer



Conformis Reports Second Quarter 2023 Financial Results

BILLERICA, Mass., August 2, 2023 (GLOBE NEWSWIRE) - Conformis, Inc. (NASDAQ:CFMS), an orthopedic medical device company that features personalized knee and hip replacement products, announced today financial results for the second quarter ended June 30, 2023.

Second Quarter 2023 Summary

•Total revenue of $13.0 million, a decrease of 15% year-over-year on a reported and constant currency basis.
•Product revenue of $12.5 million, a decrease of 17% year-over-year on a reported and constant currency basis.
•Conformis hip system revenue of $1.0 million, an increase of 30% year-over-year.
•Cash and cash equivalents of $26.2 million as of June 30, 2023.
•Announced merger agreement to be acquired by restor3d in cash acquisition; special meeting of Conformis stockholders scheduled for August 31, 2023 to adopt merger agreement.
Three months ended June 30,Increase/(decrease)
($, in thousands)20232022 $ Change % Change% Change
 (as reported)  (constant currency)
  United States $10,777 $13,415 $(2,638)(20)%(20)%
  Rest of world 1,719 1,727 (8)— %— %
Product revenue12,496 15,142 (2,646)(17)%(17)%
Royalty revenue527 153 374 244 %244 %
Total revenue$13,023 $15,295 $(2,272)(15)%(15)%

Second Quarter 2023 Highlights

Revenue
•Decrease in product revenue year-over-year was primarily due to declines in U.S. knee orders following our business model transition and manufacturing/supply chain challenges.
•Royalty and licensing revenue increased year-over-year as a result of revenue recognized under the License Agreements with Bodycad and Exactech.

Gross Margin
•Product gross profit margin was 38% in the second quarter of 2023, compared to 35% in the same period last year. The product gross margin rate increased year-over-year primarily as a result of higher selling prices on our fully personalized knees due to our Platinum Services℠ Program, volume transition to our lower cost Imprint™ knee system, and decreased cancelled case inventory expense partially offset by increased labor and material costs and lower manufacturing volumes.
•Total gross profit decreased $3.6 million to $1.8 million, or 14% of revenue, for the second quarter of 2023, compared to $5.5 million, or 36% of revenue, in the same period last year. The decrease in gross margin was driven primarily by a settlement paid in connection with the Osteoplastic Settlement and License Agreement.

Operating Expenses


•Total operating expenses of $14.1 million decreased $4.1 million, a 22% reduction year-over-year, driven by cost management efforts, lower litigation expense, and lower variable expenses as a result of the decline in revenue.
•Sales and marketing expenses decreased $2.5 million primarily due to lower tradeshow, commission, and personnel expenses.
•Research and development expenses decreased $1.8 million primarily driven by lower personnel, revenue share, and project related expenses.
•General and administrative expenses increased $0.2 million primarily driven by an increase in professional services, partially offset by a decrease in legal expenses.

Net Loss
•Net loss was $13.0 million, or $1.78 per basic and diluted share, in the second quarter of 2023, compared to a net loss of $15.5 million, or $2.15 per basic and diluted share, in the same period last year.
•Foreign currency exchange transaction loss was $0.0 million in the second quarter of 2023, compared to foreign currency exchange transaction loss of $2.4 million in the same period last year.
•Weighted average basic and diluted shares outstanding of 7.3 million for the second quarter of 2023, compared to weighted average basic and diluted shares outstanding of 7.2 million for the same period last year. All share and per share information has been retroactively adjusted for all periods presented to give effect to the 1-for-25 reverse stock split that occurred in November 2022.

Capital Structure and Liquidity
•Cash and cash equivalents totaled $26.2 million as of June 30, 2023, compared to $37.8 million as of March 31, 2023.

Merger Agreement to be Acquired by restor3d

On June 22, 2023, Conformis entered into an agreement and plan of merger with restor3d, pursuant to which, upon the terms and subject to the conditions described therein, restor3d will acquire Conformis via merger. Pursuant to the merger agreement, upon the closing, each share of Conformis common stock, other than shares to which appraisal rights are properly exercised and not withdrawn under Delaware law, will automatically be converted into the right to receive $2.27 in cash, without interest. A special meeting of Conformis stockholders has been scheduled for August 31, 2023. Conformis’ board of directors has unanimously resolved to recommend that Conformis stockholders vote to adopt the merger agreement. If the merger is consummated, Conformis’s common stock will be delisted from The Nasdaq Capital Market and deregistered under the Securities Exchange Act of 1934. Please see "Additional Information and Where to Find It" and "Participants in the Solicitation" below for important additional information regarding the proposed merger and related matters.

Note on Non-GAAP Financial Measures

In addition to disclosing financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), the Company provides certain information regarding the Company's financial results or projected financial results on a non-GAAP "constant currency basis." This information estimates the impact of changes in foreign currency rates on the translation of the Company's current or projected future period financial results as compared to the applicable comparable period. This impact is derived by taking the adjusted current or projected local currency results and translating them into U.S. dollars based upon the foreign currency exchange rates for the applicable comparable period. It does not


include any other effect of changes in foreign currency rates on the Company's results or business. Non-GAAP information is not a substitute for, and is not superior to, information presented on a GAAP basis. Company management uses these non-GAAP measures internally to measure operational performance.

About Conformis, Inc.

Conformis is a medical technology company focused on advancing orthopedic patient care and creating a world without joint pain. Its product portfolio is designed to maximize surgeon and patient choice by offering fully personalized solutions through its Image-to-Implant® Platinum Services℠ Program as well as data-informed, standardized solutions that combine many benefits of personalization with the convenience and flexibility of an off-the-shelf system. Conformis’ sterile, just-in-time, Surgery-in-a-Box™ delivery system is available with all of its implants and personalized, single-use instruments. Conformis owns or exclusively in-licenses issued patents and pending patent applications that cover personalized implants and patient-specific instrumentation for all major joints.

For more information, visit www.conformis.com. To receive future releases in e-mail alerts, sign up at ir.conformis.com.

Cautionary Statement Regarding Forward-Looking Statements

Statements in this press release about our future expectations, plans and prospects, the anticipated timing of our product launches, and our financial position and results, total revenue, product revenue, gross margin, operations and growth, as well as other statements containing the words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "might," "plan," "potential," "predict," "project," "should," "target," "will," or "would" or the negative of these terms or other and similar expressions are intended to identify forward-looking statements within the meaning of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995, although not all forward-looking statements contain these identifying words. We may not actually achieve the plans, intentions or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Actual results or events could differ materially from the plans, intentions and expectations disclosed in the forward-looking statements we make as a result of a variety of risks and uncertainties. Such risks and uncertainties include, but are not limited to, (i) the risk that the proposed merger transaction with restor3d may not be completed in a timely manner or at all, which may adversely affect the business and the price of our common stock, (ii) the failure to satisfy any of the conditions to the consummation of the proposed transaction, including the receipt of approval by our stockholders, (iii) the occurrence of any event, change or other circumstance that could give rise to the termination of the merger agreement, (iv) the outcome of any legal proceedings that have been or may be instituted against us or restor3d related to the proposed transaction, (v) whether our cash resources will be sufficient to fund our continuing operations for the periods anticipated, and whether we may be unable to continue as a going concern if the merger with restor3d is not consummated and we are unable to raise additional capital; (vi) risks related to our estimates and expectations regarding our revenue, gross margin, expenses, revenue growth and other results of operations, and (vii) the other risks and uncertainties described in the "Risk Factors" sections of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, Quarterly Report on Form 10-Q for the fiscal quarters ended March 31, 2023 and June 30, 2023, and other public filings with the U.S. Securities and Exchange Commission (the "SEC"). In addition, the forward-looking statements included in this press release represent our views as of the date hereof. We anticipate that subsequent events and developments may cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we specifically disclaim any obligation to do so. These forward-looking statements should not be relied upon as representing our views as of any date subsequent to the date hereof.

No Offer or Solicitation



This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval with respect to the proposed merger or otherwise.

Additional Information and Where to Find It

In connection with the proposed merger transaction with restor3d, Conformis filed a Definitive Proxy Statement with the SEC on July 24, 2023. The Definitive Proxy Statement and proxy card is being mailed to Conformis stockholders in advance of the special meeting relating to the proposed merger, which is scheduled to occur on August 31, 2023. BEFORE MAKING ANY VOTING DECISION, CONFORMIS STOCKHOLDERS ARE URGED TO READ IN THEIR ENTIRETY THE DEFINITIVE PROXY STATEMENTS (INCLUDING ANY FUTURE AMENDMENTS OR SUPPLEMENTS THERETO) AND ANY OTHER DOCUMENTS TO BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED MERGER OR INCORPORTED BY REFERENCE IN THE PROXY STATEMENT BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.

Investors and security holders may obtain free copies of the Definitive Proxy Statement, definitive additional materials and such other documents containing important information about the proposed merger transaction at the SEC’s web site at www.sec.gov, and on Conformis’s website at www.conformis.com and clicking on the “Investors” link and then clicking on the "SEC Filings" link. The contents of the websites referenced above are not deemed to be incorporated by reference into the Definitive Proxy Statement. In addition, the Definitive Proxy Statement and other documents may be obtained free of charge by directing a request to Conformis, Inc., Investor Relations, 600 Technology Park Drive, Billerica, MA, telephone: (781) 374-5598.

Participants in the Solicitation

Conformis and its directors and executive officers may be deemed participants in the solicitation of proxies from the stockholders of Conformis in connection with the proposed transaction. Information regarding Conformis’s directors and executive officers is included in the Definitive Proxy Statement referred to above. Security holders may also obtain information regarding Conformis’ directors and executive officers in Conformis’s definitive proxy statement for its 2023 annual meeting of stockholders (filed with the SEC on March 24, 2023), and in subsequent filings on Form 8-K. To the extent that holdings of Conformis securities have changed since the amounts printed in the Definitive Proxy Statement, such changes have been or will be reflected on Statements of Change in Ownership on Form 4 filed with the SEC. These documents are available free of charge at the SEC’s web site at www.sec.gov and from Conformis as described above. The contents of the websites referenced above are not deemed to be incorporated by reference into the Definitive Proxy Statement.

CONTACT:
Investor Relations
ir@conformis.com
(781) 374-5598


CONFORMIS, INC. AND SUBSIDIARIES
Consolidated Statements of Operations
(unaudited)
(in thousands, except share and per share data)
 
 Three Months Ended June 30,
 20232022
 
Revenue
Product$12,496 $15,142 
Royalty and licensing527 153 
Total revenue13,023 15,295 
Cost of revenue11,189 9,835 
Gross profit1,834 5,460 
 
Operating expenses
Sales and marketing4,063 6,562 
Research and development2,158 3,958 
General and administrative7,918 7,693 
Total operating expenses14,139 18,213 
Loss from operations(12,305)(12,753)
 
Other income and expenses
Interest income6 14 
Interest expense(668)(453)
Foreign currency exchange transaction loss(13)(2,432)
Total other expenses(675)(2,871)
Loss before income taxes(12,980)(15,624)
Income tax (benefit) provision31 (100)
 
Net loss$(13,011)$(15,524)
 
Net loss per share:
Basic and diluted*$(1.78)$(2.15)
Weighted average common shares outstanding:
Basic and diluted*7,316,286 7,211,851 
*Adjusted for the 1-for-25 reverse stock split


CONFORMIS, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(in thousands, except share and per share data)
   
 June 30, 2023December 31, 2022
Assets (unaudited)  
Current Assets  
Cash and cash equivalents$26,182 $48,667 
Accounts receivable, net7,676 9,773 
Royalty and licensing receivable121 134 
Inventories, net19,024 18,910 
Prepaid expenses and other current assets1,616 1,785 
Total current assets54,619 79,269 
Property and equipment, net7,455 8,154 
Operating lease right-of-use assets5,159 6,078 
Other Assets 
Restricted cash462 462 
Other long-term assets86 85 
Total assets$67,781 $94,048 
  
Liabilities and stockholder's equity 
Current liabilities 
Accounts payable$3,584 $4,163 
Accrued expenses5,252 7,978 
Operating lease liabilities1,936 1,932 
Total current liabilities10,772 14,073 
Other long-term liabilities336 230 
Long-term debt, less debt issuance costs20,639 20,563 
Operating lease liabilities4,009 5,003 
Total liabilities35,756 39,869 
Commitments and contingencies
Stockholders' equity  
Preferred stock, $0.00001 par value:  
Authorized: 5,000,000 shares authorized at June 30, 2023 and December 31, 2022; no shares issued and outstanding as of June 30, 2023 and December 31, 2022— — 
Common stock, $0.00001 par value:  
Authorized: 20,000,000 shares authorized at June 30, 2023 and December 31, 2022; 7,878,332 and 7,502,462 shares issued and outstanding at June 30, 2023 and December 31, 2022, respectively— — 
Additional paid-in capital635,703 634,647 
Accumulated deficit(603,906)(581,324)
Accumulated other comprehensive income228 856 
Total stockholders' equity32,025 54,179 
Total liabilities and stockholders' equity$67,781 $94,048 


v3.23.2
Cover
Aug. 02, 2023
Cover [Abstract]  
Document Type 8-K
Document Period End Date Aug. 02, 2023
Entity Registrant Name Conformis, Inc.
Entity Incorporation, State or Country Code DE
Entity File Number 001-37474
Entity Tax Identification Number 56-2463152
Entity Address, Address Line One 600 Technology Park Drive
Entity Address, City or Town Billerica
Entity Address, State or Province MA
Entity Address, Postal Zip Code 01821
City Area Code 781
Local Phone Number 345-9001
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, $0.00001 par value per share
Trading Symbol CFMS
Entity Emerging Growth Company false
Entity Central Index Key 0001305773
Amendment Flag false
Conformis (NASDAQ:CFMS)
Historical Stock Chart
From Mar 2024 to Apr 2024 Click Here for more Conformis Charts.
Conformis (NASDAQ:CFMS)
Historical Stock Chart
From Apr 2023 to Apr 2024 Click Here for more Conformis Charts.