Full Press Release Details
Forma Condensed Consolidated Financial Information
June 30, 2022 (the "Effective Date"), Acutus Medical, Inc. ("Acutus" or the "Company") completed
its previously announced transaction with Medtronic, Inc. (together with its affiliates, "Medtronic"), in accordance with
the Asset Purchase Agreement (the "Agreement") executed on April 26, 2022, and pursuant to which the Company sold to Medtronic
certain transseptal access and sheath assets (the "Assets"). The Assets include patents, trademarks, patent and trademark applications,
know-how, copyrights, prototypes and other intellectual property owned or licensed by the Company, business records and documents (including
regulatory and clinical materials), and manufacturing equipment related to the AcQCross line of sheath-compatible septal crossing
devices, AcQGuide MINI integrated crossing device and sheath, AcQGuide FLEX Steerable Introducer with integrated transseptal
dilator and needle, and AcQGuide VUE steerable sheaths (the "Products").
following unaudited pro
forma condensed consolidated financial statements are intended to show how the transaction might have affected the historical financial
statements of Acutus if the transaction had been completed at an earlier time as indicated therein. The unaudited pro
forma condensed consolidated financial statements have been prepared in accordance with Article 11 of Regulation S-X and were derived
from the Company's historical consolidated financial statements and are being presented to give effect to the sale of the Assets.
The unaudited pro forma condensed consolidated financial statements should be read in conjunction with:
| i. | The accompanying notes to the unaudited pro forma condensed consolidated financial statements; | |
| ii. | The audited historical financial statements of the Company and its subsidiaries, the accompanying notes and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in the Company's Annual Report on Form 10-K for the year ended December 31, 2021 filed with the SEC on March 30, 2022; and | |
| iii. | The un audited interim historical consolidated financial statements of the Company and its subsidiaries, the accompanying notes and "Management's Discussion and Analysis of Financial Condition and Results of Operations" included in the Company's Quarterly Report on Form 10-Q for the six months ended June 30, 2022 filed with the SEC on August 11, 2022. |
forma condensed consolidated financial statements of the Company are based on available information and assumptions that the
Company's management believes are reasonable as of the date of this filing. The unaudited pro forma condensed
consolidated statements of operations for the year ended December 31, 2021 and the six months ended June 30, 2022 present the
Company's results of operations as if the transaction had occurred on January 1, 2021, the beginning of the earliest period
presented. An unaudited pro forma condensed consolidated balance sheet is not presented as the transaction closed on June 30, 2022
and the balance sheet effects of the transaction are already included in the Company's condensed consolidated balance sheet as of
forma condensed consolidated financial statements do not purport to represent the Company's actual consolidated results of operations
or financial condition had the transaction occurred on the date assumed, nor are they indicative of the Company's future consolidated
results of operations or financial condition.
11 of Regulation S-X. Article 11 of Regulation S-X requires that pro forma financial information include the following pro forma adjustments
to the historical financial statements of the registrant as follows:
| Transaction Accounting Adjustments - Adjustments that reflect only the application of required accounting to the acquisition, disposition , or other transaction. | ||
| Autonomous Entity Adjustments - Adjustments that are necessary to reflect the operations and financial position of the registrant if the registrant was previously part of another entity. There are no autonomous entity adjustments included in the pro forma financial information since the Company currently operates, and after the completion of the transaction will continue to operate, as an independent, standalone entity . |
addition, Regulation S-X permits registrants to reflect adjustments that depict synergies and dis-synergies of the acquisitions and
dispositions for which pro forma effect is being given in our disclosures as management adjustments. The unaudited pro
forma condensed consolidated financial statements do not include management adjustments to reflect any potential synergies that may
be achievable, or dis-synergy costs that may occur, in connection with the sale of the Assets. The Company has determined not to
reflect such adjustments because it does not believe presenting such adjustments would enhance an understanding of the pro forma
effects of the transaction.
transaction accounting adjustments to reflect the sale of the Assets in the unaudited pro forma condensed consolidated financial
forma condensed consolidated financial statements are presented for informational purposes only and are based upon estimates by the Company's
management, which are based upon available information and certain assumptions that the Company's management believes are reasonable
as of the date of this filing. The unaudited pro forma condensed consolidated financial statements are not intended to be results of operations that would have been achieved had the transaction been consummated as of the
date indicated above, nor does it purport to indicate results which may be attained in the future. Actual amounts could differ materially
from these estimates.
Forma Condensed Consolidated Statement of Operations
the six months ended June 30, 2022
| Historical Acutus | Transaction Accounting Adjustments | |||||||||||||||
| (a) | (b) | Notes | Pro Forma | |||||||||||||
| (in thousands, except share and per share amounts) | ||||||||||||||||
| Revenue | $ | 7,757 | $ | (1,300 | ) | (1 | ) | $ | 6,457 | |||||||
| Costs and operating expenses | ||||||||||||||||
| Cost of products sold | 16,638 | (1,145 | ) | (1 | ) | 15,493 | ||||||||||
| Research and development | 15,938 | (308 | ) | (1 | ) | 15,630 | ||||||||||
| Selling, general and administrative | 28,528 | (218 | ) | (1 | ) | 28,310 | ||||||||||
| Goodwill impairment | 12,026 | - | 12,026 | |||||||||||||
| Restructuring | 949 | - | 949 | |||||||||||||
| Change in fair value of contingent consideration | 955 | - | 955 | |||||||||||||
| Gain on sale of business | (43,575 | ) | 43,575 | (1 | ) | - | ||||||||||
| Total costs and operating expenses | 31,459 | 41,904 | 73,363 | |||||||||||||
| Loss from operations | (23,702 | ) | (43,204 | ) | (66,906 | ) | ||||||||||
| Total other expense, net | ||||||||||||||||
| Loss on debt extinguishment | (7,947 | ) | - | (7,947 | ) | |||||||||||
| Interest income | 51 | - | 51 | |||||||||||||
| Interest expense | (2,701 | ) | - | (2,701 | ) | |||||||||||
| Total other expense, net | (10,597 | ) | - | (10,597 | ) | |||||||||||
| Loss before income taxes | (34,299 | ) | (43,204 | ) | (77,503 | ) | ||||||||||
| Income tax benefit | - | - | - | |||||||||||||
| Net loss | $ | (34,299 | ) | $ | (43,204 | ) | $ | (77,503 | ) | |||||||
| Net loss per common share, basic and diluted | $ | (1.22 | ) | $ | (2.75 | ) | ||||||||||
| Weighted average shares outstanding, basic and diluted | 28,229,338 | 28,229,338 |
accompanying notes to the unaudited pro forma condensed consolidated financial statements.
Forma Condensed Consolidated Statement of Operations
the year ended December 31, 2021
| Historical Acutus | Transaction Accounting Adjustments | |||||||||||||||
| (a) | (b) | Notes | Pro Forma | |||||||||||||
| (in thousands, except share and per share amounts) | ||||||||||||||||
| Revenue | $ | 17,263 | $ | (1,967 | ) | (1 | ) | $ | 15,296 | |||||||
| Costs and operating expenses | ||||||||||||||||
| Cost of products sold | 32,925 | (1,845 | ) | (1 | ) | 31,080 | ||||||||||
| Research and development | 36,683 | (890 | ) | (1 | ) | 35,793 | ||||||||||
| Selling, general and administrative | 63,523 | (574 | ) | (1 | ) | 62,949 | ||||||||||
| Change in fair value of contingent consideration | (3,746 | ) | - | (3,746 | ) | |||||||||||
| Gain on sale of business | - | (43,459 | ) | (1 | ) | (43,459 | ) | |||||||||
| Total costs and operating expenses | 129,385 | (46,768 | ) | 82,617 | ||||||||||||
| Loss from operations | (112,122 | ) | 44,801 | (67,321 | ) | |||||||||||
| Total other expense, net | ||||||||||||||||
| Interest income | 116 | - | 116 | |||||||||||||
| Interest expense | (5,677 | ) | - | (5,677 | ) | |||||||||||
| Total other expense, net | (5,561 | ) | - | (5,561 | ) | |||||||||||
| Loss before income taxes | (117,683 | ) | 44,801 | (72,882 | ) | |||||||||||
| Income tax benefit | - | - | - | |||||||||||||
| Net loss | $ | (117,683 | ) | $ | 44,801 | $ | (72,882 | ) | ||||||||
| Net loss per common share, basic and diluted | $ | (4.11 | ) | $ | (2.54 | ) | ||||||||||
| Weighted average shares outstanding, basic and diluted | 28,654,313 | 28,654,313 |
accompanying notes to unaudited pro forma condensed consolidated financial statements.
to the Unaudited Pro Forma Condensed Consolidated Financial Statements
June 30, 2022 (the "Effective Date"), Acutus Medical, Inc. (the "Company") completed its previously
announced transaction with Medtronic, Inc. (together with its affiliates, "Medtronic"), in accordance with the Asset
Purchase Agreement (the "Agreement") executed on April 26, 2022, and pursuant to which the Company sold to Medtronic
certain transseptal access and sheath assets (the "Assets"). The Assets include patents, trademarks, patent and trademark
applications, know-how, copyrights, prototypes and other intellectual property owned or licensed by the Company, business records
and documents (including regulatory and clinical materials) and manufacturing equipment related to the AcQCross line of
sheath-compatible septal crossing devices, AcQGuide MINI integrated crossing device and sheath, AcQGuide FLEX Steerable
Introducer with integrated transseptal dilator and needle, and AcQGuide VUE steerable sheaths (the "Products"). Pursuant
to the Agreement, Medtronic paid $50.0 million at the first closing ("First Closing") for, among other things, intellectual property
rights to the Products and certain equipment used in the manufacturing of the Products, of which $4.0 million was paid
into an indemnity escrow account for a period of 18 months following the First Closing. The Company is also eligible to receive the
following contingent cash consideration pursuant to the Agreement;
of the above milestones were achieved as of June 30, 2022.
second closing will occur on a date determined by Medtronic but no later than the fourth anniversary of the First Closing, subject to
the satisfaction of customary closing conditions (the "Second Closing"). The Agreement provides that the Company may continue
to sell the Products to third parties prior to achievement of the OEM Earnout. Following achievement of the OEM Earnout, the Company
will manufacture the Products exclusively for Medtronic pursuant to a distribution agreement executed between the parties. At the Second
Closing, Medtronic will acquire certain additional assets relating to the Products, primarily supplier agreements and permits and design
and specification files required for Medtronic to become the manufacturer of record of the Products.
forma condensed consolidated financial statements reflect the following: