As filed with the U.S. Securities and Exchange Commission on May 11, 2021July 7, 2023
Registration Statement No. 333-_________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Xtant Medical holdings, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 20-5313323 | |
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) |
664 Cruiser Lane
Belgrade, Montana 59714
(406) 388-0480
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
Sean E. Browne
President and Chief Executive Officer
Xtant Medical Holdings, Inc.
664 Cruiser Lane
Belgrade, Montana 59714
(406) 388-0480
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
Amy E. Culbert, Esq.
Emily Humbert, Esq.
Fox Rothschild LLP
222City Center
33 South NinthSixth Street, Suite 20003600
Minneapolis, Minnesota 55402-333855402
(612) 607-7000
Approximate date of commencement of proposed sale to the public: From time to time after this registration statement becomes effective.effective as determined by the selling stockholders.
If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box: [ ]☐
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box: [X]☒
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]☐
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]☐
If this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. [ ]☐
If this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. [ ]☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer | Accelerated filer | ||
| Non-accelerated filer | Smaller reporting company | ||
| 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 7(a)(2)(B) of the Securities Act. [ ]☐
CALCULATION OF REGISTRATION FEE
| Title of each class of securities to be registered | Amount to be registered | Proposed maximum offering price per unit | Proposed maximum aggregate offering price | Amount of registration fee | ||||||||||||
| Primary Offering by Xtant: | ||||||||||||||||
| Common Stock, par value $0.000001 per share(1)(2) | (3)(4) | (3)(4) | (5) | |||||||||||||
| Preferred Stock, par value $0.000001 per share(2) | (3)(4) | (3)(4) | (5) | |||||||||||||
| Warrants(2) | (3) | (3) | (5) | |||||||||||||
| Units(6) | (3) | (3) | (5) | |||||||||||||
| Total Primary Offering | $ | 150,000,000.00 | $ | 16,365.00 | (7) | |||||||||||
| Secondary Offering by Selling Stockholders: | ||||||||||||||||
| Common Stock, par value $0.000001 per share | 18,218,374 shares | (8) | $ | 1.67 | (9) | $ | 30,424,684.60 | $ | 3,319.33 | |||||||
| Total Registration Fee (Primary and Secondary) | $ | 180,424,684.60 | $ | 19,684.33 | ||||||||||||
The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said section 8(a), may determine.
The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission becomes effective. This prospectus is not an offer to sell these securities, and neither we nor the selling stockholders are soliciting offers to buy these securities in any state where the offer or sale of these securities is not permitted.
SUBJECT TO COMPLETION, DATED MAY 11, 2021JULY 7, 2023
PRELIMINARY PROSPECTUS
$150,000,000
Common Stock
Preferred Stock
Warrants
Units
Offered by Xtant Medical Holdings, Inc.
18,218,37420,000,000 Shares of Common Stock
Offered by Selling Stockholders
This prospectus relates to our common stock, preferred stock, warrants to purchase our common stock or preferred stock, and units comprised of any combination of these securities that we may sell from time to time in one or more offerings up to a total public offering price of $150,000,000 on terms to be determined at the time of sale. In addition, this prospectus relates to the resale, from time to time, of up to an aggregate of 18,218,37420,000,000 shares of our common stock, par value $0.000001 per share, of Xtant Medical Holdings, Inc. by the selling stockholders named in this prospectus, including their respective donees, pledgees, transferees, assignees or other successors-in-interest. The selling stockholders acquired these shares from us pursuant to a Securities Purchase Agreement, dated as of July 3, 2023, pursuant to which we issued an aggregate of 20,000,000 shares of common stock in a private placement at a per share purchase price of $0.75.
We are not selling any shares of our common stock under this prospectus and will not receive any proceeds from sales of the shares offered by the selling stockholders, although we will incur expenses in connection with suchthe offering. The registration of the resale of the shares of common stock covered by this prospectus does not necessarily mean that any of the shares will be offered or sold by the selling stockholders. The timing and amount of any sales are within the sole discretion of the selling stockholders.
This prospectus provides a general descriptionThe shares of the securities that we may offer. Each time we sell securities, we will provide the specific terms of the securitiescommon stock offered in a supplement to this prospectus. The prospectus supplement may also add, update or change information contained in this prospectus. You should readunder this prospectus and the applicable prospectus supplement carefully before you invest in any securities. This prospectus may not be used to consummate a sale of securities unless accompaniedsold by the applicableselling stockholders through public or private transactions, on or off the NYSE American, at prevailing market prices or at privately negotiated prices. For more information on the times and manner in which the selling stockholders may sell the shares of common stock under this prospectus, supplement.
We may from time to time offer and sell our securities in one offering or in separate offerings, to or through underwriters, dealers and agents or directly to purchasers. If any agents or underwriters are involved inplease see the salesection entitled “Plan of anyDistribution,” beginning on page 17 of these securities, the applicable prospectus supplement will provide the names of the agents or underwriters and any applicable fees, commissions or discounts.this prospectus.
Our common stock is listed on the NYSE American under the symbol “XTNT.” On May 10, 2021,July 6, 2023, the last reported sale price of our common stock on the NYSE American was $1.67$0.84 per share.
As of May 10, 2021, the aggregate market value of our outstanding common stock held by non-affiliates was approximately $40.7 million, based on 86,707,286 shares of outstanding common stock, of which 13,483,369 shares were held by non-affiliates, and a per share price of $3.02 based on the closing sale price of our common stock as of March 22, 2021. Pursuant to General Instruction I.B.6 of Form S-3, in no event will we sell securities pursuant to this prospectus with a value of more than one-third of the aggregate market value of our common stock held by non-affiliates in any twelve-month period, so long as the aggregate market value of our common stock held by non-affiliates is less than $75,000,000. In the event that subsequent to the date of this prospectus, the aggregate market value of our outstanding common stock held by non-affiliates equals or exceeds $75,000,000, then the one-third limitation on sales shall not apply to additional sales made pursuant to this prospectus. We have not offered any securities pursuant to General Instruction I.B.6 of Form S-3 during the twelve calendar months prior to and including the date of this prospectus.
Investing in our shares of common stock involves a high degree of risk. See “Risk Factors” beginning on page 3 of this prospectus, as well as those risk factors described in any applicable prospectus supplement and in the documents we incorporate by reference.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
The date of this prospectus is , 2021.2023.
TABLE OF CONTENTS
We are responsible for the information contained and incorporated by reference in this prospectus and any accompanying prospectus supplement we prepare or authorize. Neither we nor the selling stockholders, as defined below, have authorized anyone to provide any information or to make any representations other than those contained in or incorporated by reference into this prospectus and any accompanying prospectus supplement we have prepared. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. This prospectus and any accompanying prospectus supplement are an offer to sell only the shares offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus and any accompanying prospectus supplement is current only as of the date of the applicable document. Our business, financial condition, results of operations and prospects may have changed since those dates. It is important for you to read and consider all the information contained in this prospectus and in any accompanying prospectus supplement, including the documents incorporated by reference herein or therein, before making your investment decision.
For investors outside the United States: we have not, and the selling stockholders have not, taken any action to permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offer and sale of the common stock and the distribution of this prospectus outside the United States.
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This prospectus is a part of a registration statement on Form S-3 that we filed with the United States Securities and Exchange Commission (“SEC”) utilizing a “shelf” registration process., under the Securities Act of 1933, as amended (“Securities Act”). Under this shelf registration process, we may offer and sell any combination of the securities described in this prospectus in one or more offerings up to a total dollar amount of $150,000,000. In addition, under this shelf registration process, the selling stockholders named in this prospectus may offer or sell shares of our common stock in one or more offerings from time to time. Each time we or the selling stockholders named in this prospectus (or in any supplement to this prospectus) sell shares of our common stock under the registration statement of which this prospectus is a part, we or such selling stockholders must provide a copy of this prospectus and any applicable prospectus supplement to a potential purchaser as required by law.
In certain circumstances we may provide a prospectus supplement that may add, update or change information contained in this prospectus. Any statement that we make in this prospectus will be modified or superseded by any inconsistent statement made by us in a prospectus supplement. You should read both this prospectus and any prospectus supplement, including all documents incorporated herein or therein by reference, together with additional information described under “Where You Can Find More Information” beginning on page 2319 of this prospectus and “Incorporation“Incorporation of Certain DocumentsInformation by Reference” beginning on page 2218 of this prospectus.
Neither we, nor the selling stockholders, have authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. Neither we nor any of the selling stockholders will make an offer to sell our securitiescommon stock in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus and any prospectus supplement is accurate as of the date on its respective cover, and that any information incorporated by reference is accurate only as of the date of the document incorporated by reference, unless we indicate otherwise. Our business, financial condition, results of operations and prospects may have changed since those dates.
Unless otherwise indicated, information contained in or incorporated by reference into this prospectus concerning our industry and the markets in which we operate, including our general expectations and market position, market opportunity and market share, is based on information from our own management estimates and research, as well as from industry and general publications and research, surveys and studies conducted by third parties. Management estimates are derived from publicly available information, our knowledge of our industry and assumptions based on such information and knowledge, which we believe to be reasonable. In addition, assumptions and estimates of our and our industry’s future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, see “Risk Factors” beginning on page 3 of this prospectus. These and other factors could cause our future performance to differ materially from our assumptions and estimates. See “Cautionary Note Regarding Forward-Looking Statements” beginning on page 47 of this prospectus.
Solely for convenience, trademarks and trade names referred to in this prospectus may appear without the ® and ™ symbols, but those references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights, or that the applicable owner will not assert its rights, to these trademarks and tradenames.
Unless the context otherwise indicates, the terms “Xtant,” “XTNT,” “Company,” “we,” “us,” and “our” as used in this prospectus refer to Xtant Medical Holdings, Inc. and our subsidiaries, and the term “common stock” refers to our common stock, par value $0.000001 per share. The phrase “this prospectus” refers to this prospectus and any applicable prospectus supplement, unless the context otherwise requires.
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This summary highlights certain information about us, this offering and selected information contained in this prospectus. This summary is not complete and does not contain all of the information that you should consider before deciding whether to invest in our common stock. For a more complete understanding of the Company and this offering, we encourage you to read and consider the more detailed information included or incorporated by reference in this prospectus, including risk factors, see “Risk Factors” beginning on page 3 of this prospectus, and our most recent consolidated financial statements and related notes.
About Xtant Medical Holdings, Inc.
We are a global medical technology company focused on the design, development, and commercialization of a comprehensive portfolio of orthobiologics and spinal implant fixation systems to facilitate spinal fusion in complex spine, deformity, and degenerative procedures. Our products are used byserve the specialized needs of orthopedic spineand neurological surgeons, including orthobiologics for the promotion of bone healing, implants and neurosurgeons to treat a varietyinstrumentation for the treatment of spinal disorders in the cervical, thoracolumbar, and interbody spine.
disease. We promote and sell our products in the United States largely through independent distributors and stocking agents, augmentedsupported by direct employees.
We have an extensive distributionsales channel of independent commissioned independent agents and stocking agentsdistributors in the United States representing some or all of our products. We also maintain a national accounts program to enable our agents to gain access to independent healthintegrated delivery network hospitals (“IDNs”) and through group purchasing organizations (“GPOs”). We have biologics contracts with major GPOs, as well as extensive access to integrated delivery networksIDNs across the United States for both our biologics and spine hardware products. Wesystems. While our focus is the United States market, we promote and sell our products internationally through stocking distribution partners in Canada, Mexico, South America, Australia, and certain Pacific region countries.
Corporate Information
The address of our principal executive office is 664 Cruiser Lane Belgrade, Montana 59714. Our59714 and our telephone number is (406) 388-0480,388-0480.
Our Recent Private Placement
Securities Purchase Agreement
On July 3, 2023, we entered into the Securities Purchase Agreement (the “Securities Purchase Agreement”) with accredited investors (the “Investors”), pursuant to which we agreed to issue an aggregate of 20,000,000 shares of common stock in a private placement (the “Private Placement”) at a per share purchase price of $0.75. The closing of the Private Placement occurred on July 6, 2023. We received gross proceeds of approximately $15.0 million before deducting estimated offering expenses payable by the Company. We expect to use the net proceeds from the Private Placement for working capital and other general corporate purposes.
Under the terms of the Securities Purchase Agreement, each of our Internet website addressdirectors and executive officers entered into lock-up agreements with the Company pursuant to which they agreed, subject to certain customary exceptions, not to offer, sell, contract to sell, hypothecate, pledge or otherwise dispose of (or enter into any transaction which is www.xtantmedical.comdesigned to, or might reasonably be expected to, result in the disposition (whether by actual disposition or effective economic disposition due to cash settlement or otherwise), directly or indirectly, or establish or increase a put equivalent position or liquidate or decrease a call equivalent position, with respect to, any shares of our common stock or securities convertible, exchangeable or exercisable into, shares of our common stock beneficially owned, held or hereafter acquired by such director or executive officer.
Registration Rights Agreement
Under the terms of the Securities Purchase Agreement, we entered into a registration rights agreement (the “Registration Rights Agreement”) with the Investors at the closing of the Private Placement pursuant to which we agreed to prepare and file a shelf resale registration statement (the “Resale Registration Statement”) with the SEC within 30 days of the date of the closing for purposes of registering the resale of the shares of common stock (the “Registrable Securities”). The registration statement of which this prospectus is a part has been filed to satisfy this obligation. Under the terms of the Registration Rights Agreement, we agreed to use commercially reasonable best efforts to cause the Resale Registration Statement to be declared effective by the SEC within 60 days of the closing of the closing (90 days in the event the Resale Registration Statement is reviewed by the SEC). If we fail to meet the specified filing deadlines or keep the Resale Registration Statement effective, subject to certain permitted exceptions, we will be required to pay liquidated damages to the Investors. We make available on our website free of charge a linkalso agreed, among other things, to indemnify the selling stockholders from certain liabilities and to pay all fees and expenses incident to our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports as soon as practicable after we electronically file such materialperformance of or compliance with the SEC. Except for the documents specifically incorporated by reference into this prospectus, information contained on our website or that can be accessed through our website does not constitute a part of this prospectus. We have included our website address only as an inactive textual reference and do not intend it to be an active link to our website.Registration Rights Agreement.
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The Offering
| Common stock to be offered by the selling stockholders: | Up to 20,000,000 shares | |
| Common stock to be outstanding after the offering: | 128,897,048 shares (based on 108,897,048 shares outstanding prior to the Private Placement) | |
| Use of proceeds: | We will not receive any proceeds from the sale of shares in this offering. See “Use of Proceeds” beginning on page 9 of this prospectus. | |
| Risk factors: | You should read the “Risk Factors” beginning on page 3 of this prospectus and the “Risk Factors” sections of the documents incorporated by reference in this prospectus for a discussion of factors to consider carefully before deciding to invest in shares of our common stock. | |
| Stock exchange listing: | Our common stock is listed on the NYSE American under the symbol “XTNT.” |
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AnBefore making an investment in our securities involves a high degree of risk. Youdecision, you should carefully consider the following risks and the risks described in the “Risk Factors” section of our filingsmost recent Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC referred to underon March 7, 2023, and our Quarterly Report on Form 10-Q for the heading “Where You Can Find More Information,” includingquarterly period ended March 31, 2023, filed with the risk factorsSEC on May 4, 2023, and in any other documents incorporated by reference herein from our most recent annual report on Form 10-K and quarterly reports on Form 10-Q and from other reports and documents we file with the SEC after the date ofinto this prospectus, that are incorporatedas updated by reference herein, together with allour future filings. The occurrence of any of the other information included in this prospectus, the applicable prospectus supplement and the documents we incorporate by reference.
If any of these risks were to occur,events described below could have a material adverse effect on our business, financial condition, results of operations, or cash flows, prospects or the value of our common stock. These risks are not the only ones that we face. Additional risks not currently known to us or that we currently deem immaterial also may impair our business.
Risks Related to this Offering and Our Common Stock
Sales of shares in connection with this offering may cause the market price of our common stock to decline.
In connection with the Private Placement, we entered into the Securities Purchase Agreement and Registration Rights Agreement, pursuant to which we agreed to register for resale with the SEC the shares of our common stock issued to the selling stockholders in the Private Placement. The registration statement of which this prospectus is a part has been filed to satisfy this obligation. Upon the effectiveness of the registration statement, the shares we issued in the Private Placement may be freely sold in the open market. The sale of a significant amount of these shares of our common stock in the open market, or the perception that these sales may occur, could cause the market price of our common stock to decline or become highly volatile.
Shares of our common stock are equity securities and are subordinate to our outstanding indebtedness.
Shares of our common stock are common equity interests. This means that our common stock will rank junior to any outstanding shares of our preferred stock that we may issue in the future or to the indebtedness under our Credit, Security and Guarantee Agreement (Term Loan), as amended (the “Term Credit Agreement”), and Credit, Security and Guaranty Agreement (Revolving Loan), as amended (the “Revolving Credit Agreement” and, together with the Term Credit Agreement, the “Credit Agreements”), with MidCap Financial Trust and any future indebtedness we may incur and to all creditor claims and other non-equity claims against us and our assets available to satisfy claims on us, including claims in a bankruptcy or similar proceeding. Additionally, unlike indebtedness, where principal and interest customarily are payable on specified due dates, in the case of our common stock, (i) dividends are payable only when and if declared by our Board of Directors, and (ii) as a corporation, we are restricted to making dividend payments and redemption payments out of legally available assets. We have never paid a dividend on our common stock and have no current intention to pay dividends in the future. In addition, our Credit Agreements preclude us from paying dividends. Furthermore, our common stock places no restrictions on our business or operations or on our ability to incur indebtedness or engage in any transactions, subject only to the voting rights available to stockholders generally.
Our inability to comply with the continued listing requirements of the NYSE American could result in our common stock being delisted, which could affect its market price and liquidity and reduce our ability to raise capital.
We are required to meet certain qualitative and financial tests to maintain the listing of our common stock on the NYSE American. If we do not maintain compliance with the continued listing requirements for the NYSE American within specified periods and subject to permitted extensions, our common stock may be recommended for delisting (subject to any appeal we would file). On October 5, 2020, we regained compliance with these continued listing requirements as a result of the completion of our August 2020 debt restructuring. No assurance can be provided that we will continue to comply with these continued listing requirements. If our common stock were delisted, it could be adversely affected. Youmore difficult to buy or sell our common stock and to obtain accurate quotations, and the price of our stock could lose allsuffer a material decline. Delisting would also impair our ability to raise capital.
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The market price of our common stock is extremely volatile, which may affect our ability to raise capital in the future and may subject the value of the investment of our stockholders to sudden decreases.
The market price for securities of medical device and biotechnology companies, including ours, historically has been highly volatile, and the market from time to time has experienced significant price and volume fluctuations that are unrelated to the operating performance of such companies. The trading volume and prices of our common stock have been and may continue to be volatile and could fluctuate widely due to factors both within and beyond our control. During 2022, the sale price of our common stock ranged from $0.46 to $0.88 per share, and our daily trading volume ranged from 2 thousand to 328 thousand shares. During the first six months of 2023, the sale price of our common stock ranged from $0.56 to $1.20 per share, and our daily trading volume ranged from 4 hundred to 520 thousand shares. Such volatility may be the result of broad market and industry factors. Future fluctuations in the trading price or partliquidity of your investment. When we offerour common stock may harm the value of the investment of our stockholders in our common stock. Factors that may have a significant impact on the market price and sellmarketability of our common stock include, among others:
| ● | the terms of any potential future transaction(s) related to debt financing, debt restructuring or capital raising; | |
| ● | our ability to make interest payments under our Credit Agreements; | |
| ● | our observance of covenants under our Credit Agreements; | |
| ● | announcements of technological innovations or new commercial products by us or our present or potential competitors; | |
| ● | developments or disputes concerning patent or other proprietary rights; | |
| ● | developments in our relationships with employees, suppliers, distributors, sales representatives and customers; | |
| ● | acquisitions or divestitures; | |
| ● | litigation and government proceedings; | |
| ● | adverse legislation, including changes in governmental regulation; | |
| ● | third-party reimbursement policies; | |
| ● | additions or departures of key personnel; | |
| ● | sales of our equity securities by our significant stockholders or management or sales of additional equity securities by our Company; | |
| ● | changes in securities analysts’ recommendations; | |
| ● | short selling; | |
| ● | changes in health care policies and practices; | |
| ● | the delisting of our common stock or halting or suspension of trading in our common stock by the NYSE American; | |
| ● | economic, social and other external factors, such as COVID-19, supply chain disruptions, labor shortages and persistent inflation; and | |
| ● | general market conditions. |
In the past, following periods of volatility in the market price of a company’s securities, securities class action litigation has often been instituted. These lawsuits often seek unspecified damages, and as with any securities pursuant to a prospectus supplement,litigation proceeding, one cannot predict with certainty the eventual outcome of pending litigation. Furthermore, we may include additional risk factors relevanthave to incur substantial expenses in connection with any such lawsuits and our management’s attention and resources could be diverted from operating our business as we respond to any such litigation. We maintain insurance to cover these risks for us and our directors and officers, but our insurance is subject to high deductibles to reduce premium expense, and there is no guarantee that offeringthe insurance will cover any specific claim that we currently face or may face in the prospectus supplement.future, or that it will be adequate to cover all potential liabilities and damages.
We may issue additional common stock resulting in stock ownership dilution.
From time to time, we issue equity securities to raise additional financing and in connection with debt restructurings. In the Private Placement, we issued 20 million shares of common stock at a purchase price of $0.75 per share. During 2022, we issued in a private placement approximately 20.3 million shares of common stock at a purchase price of $0.48 per share and warrants to purchase approximately 5.1 million shares of common stock. Future dilution may occur due to additional future equity issuances and/or equity financing events by us, including any potential future restructuring of our outstanding indebtedness. In addition, we may raise additional capital through the sale of equity or convertible debt securities, which would further dilute the ownership interests of our stockholders. As of July 6, 2023, we had outstanding warrants to purchase approximately 12,187,470 shares of our common stock, stock options to purchase 3,403,192 shares of our common stock and restricted stock unit awards covering 3,282,898 shares of our common stock under the Xtant Medical Holdings, Inc. Second Amended and Restated 2018 Equity Incentive Plan, options to purchase 12,012 shares of our common stock under our prior equity compensation plan, and 7,387,813 shares available for issuance under the Xtant Medical Holdings, Inc. Second Amended and Restated 2018 Equity Incentive Plan. If these or any future warrants, options or restricted stock units are exercised or otherwise converted into shares of our common stock, our stockholders will experience additional dilution.
The sale or availability for sale of substantial amounts of our common stock or other equity securities could adversely affect the market price of our common stock.
Sales of substantial amounts of our common stock or a preferred stock in the public market, or the perception that these sales could occur, could adversely affect the market price of our common stock and could materially impair our ability to raise capital through equity offerings in the future. We cannot predict what effect, if any, market sales of securities beneficially owned by OrbiMed Advisors LLC or any other stockholder or the availability of these securities for future sale will have on the market price of our common stock.
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Anti-takeover provisions in our organizational documents and agreements may discourage or prevent a change in control, even if a sale of the Company could be beneficial to our stockholders, which could cause our stock price to decline and prevent attempts by our stockholders to replace or remove our current management.
Several provisions of our Amended and Restated Certificate of Incorporation, as amended (the “Charter”) and Third Amended and Restated Bylaws (the “Bylaws”) and our Investor Rights Agreement (the “Investor Rights Agreement”), dated as of February 14, 2018 with OrbiMed Royalty Opportunities II, LP (“Royalty Opportunities”) and ROS Acquisition Offshore LP (“ROS”), could make it difficult for our stockholders to change the composition of our Board of Directors, preventing them from changing the composition of management. In addition, several provisions of our Charter and Bylaws may discourage, delay or prevent a merger or acquisition that our stockholders may consider favorable. These provisions include:
| ● | We have shares of common stock and preferred stock available for issuance without stockholder approval. The existence of unissued and unreserved common stock and preferred stock may enable the Board of Directors to issue shares to persons friendly to current management or to issue preferred stock with terms that could render more difficult or discourage a third-party attempt to obtain control of us by means of a merger, tender offer, proxy contest or otherwise, thereby protecting the continuity of our management. | |
| ● | Shares of our common stock do not have cumulative voting rights in the election of directors, so our stockholders holding a majority of the shares of common stock outstanding will be able to elect all of our directors. | |
| ● | Special meetings of the stockholders may be called only by the Board of Directors, the chair of the Board of Directors or the chief executive officer. | |
| ● | The Board of Directors may adopt, alter, amend or repeal our Bylaws without stockholder approval. | |
| ● | Unless otherwise provided by law, any newly created directorship or any vacancy occurring on the Board of Directors for any cause may be filled by the affirmative vote of a majority of the remaining members of the Board of Directors even if such majority is less than a quorum, and any director so elected shall hold office until the expiration of the term of office of the director whom he or she has replaced or until his or her successor is elected and qualified. | |
| ● | The affirmative vote of the holders of at least two-thirds of the voting power of the then outstanding shares of our capital stock entitled to vote generally in the election of directors, voting together as a single class, is required to amend or repeal the provisions of our Charter related to the amendment of our Bylaws, the Board of Directors and our stockholders as well as the general provisions of our Charter. | |
| ● | Stockholders must follow advance notice procedures to submit nominations of candidates for election to the Board of Directors at an annual or special meeting of our stockholders, including director election contests subject to the SEC’s universal proxy rules, and must follow advance notice procedures to submit other proposals for business to be brought before an annual meeting of our stockholders. | |
| ● | Unless we consent in writing to an alternative forum, the Court of Chancery of the State of Delaware, subject to certain limitations, will be the exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee to us or our stockholders, (iii) any action asserting a claim arising under any provision of the General Corporation Law of the State of Delaware (“DGCL”), our Charter or our Bylaws, or (iv) any action asserting a claim governed by the internal-affairs doctrine. | |
| ● | The Investor Rights Agreement includes director nomination rights, which provide that so long as the Ownership Threshold (as defined in the Investor Rights Agreement) is met, Royalty Opportunities and ROS are entitled to nominate such individuals to the Board of Directors constituting a majority of the directors. In addition, under the Investor Rights Agreement, so long as the Ownership Threshold is met, certain matters require the approval of Royalty Opportunities and ROS to proceed with such a transaction, including without limitation, the sale, transfer or other disposition of our assets or businesses or our subsidiaries with a value in excess of $250,000 in the aggregate during any fiscal year (other than sales of inventory or supplies in the ordinary course of business, sales of obsolete assets (excluding real estate), sale-leaseback transactions and accounts receivable factoring transactions). | |
| ● | The Letter Agreement between us and Mr. Stavros Vizirgianakis includes director nomination rights, which terminate on the earlier of (i) the date on which Mr. Vizirgianakis ceases to hold at least 75% of the shares of common stock purchased by him in our 2022 private placement, (ii) the second anniversary of the date of the second closing of our 2022 private placement, or (iii) upon written notice of Mr. Vizirgianakis to us. |
These anti-takeover provisions could substantially impede the ability of our stockholders to benefit from a change in control and, as a result, could materially adversely affect the market price of our common stock and the ability of our stockholders to realize any potential change-in-control premium.
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Our Board of Directors is authorized to issue and designate shares of our preferred stock without stockholder approval.
Our Charter authorizes our Board of Directors, without the approval of our stockholders, to issue up to 10 million shares of our preferred stock, subject to limitations prescribed by applicable law, rules and regulations and the provisions of our Charter, as shares of preferred stock in series, to establish from time to time the number of shares to be included in each such series and to fix the designation, powers, preferences and rights of the shares of each such series and the qualifications, limitations or restrictions thereof. The powers, preferences and rights of these series of preferred stock may be senior to or on parity with our common stock, which may reduce its value.
Our Charter designates the Court of Chancery of the State of Delaware as the exclusive forum for certain litigation that may be initiated by our stockholders, which could limit the ability of our stockholders to obtain a favorable judicial forum for disputes with us.
Our Charter provides that the Court of Chancery of the State of Delaware will be the exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee to us or our stockholders, (iii) any action asserting a claim arising under any provision of the DGCL, or (iv) any action asserting a claim governed by the internal-affairs doctrine. Stockholders in our Company will be deemed to have notice of and have consented to the provisions of our Charter related to choice of forum. The choice of forum provision in our Charter may limit the ability of our stockholders to obtain a favorable judicial forum for disputes with us.
Notwithstanding the foregoing, Section 27 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder and Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. As a result, the exclusive forum provision will not apply to suits brought to enforce any duty or liability created by the Exchange Act, the Securities Act, or any other claim for which the federal courts have exclusive jurisdiction.
We have never paid dividends and do not expect to do so in the foreseeable future.
We have not declared or paid any cash dividends on our common stock. The payment of dividends in the future will be dependent on our earnings and financial condition and on such other factors as our Board of Directors considers appropriate. Unless and until we pay dividends, stockholders may not receive a return on their shares of our common stock. There is no present intention by our Board of Directors to pay dividends on our common stock. We currently intend to retain all of our future earnings, if any, to finance the growth and development of our business. In addition, the terms of our Credit Agreements preclude us from paying dividends. As a result, appreciation, if any, in the market price of our common stock will be the sole source of gain for our stockholders for the foreseeable future.
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements contained in or incorporated by reference into this prospectus, or filings with the SEC and our public releases, that are not purely historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Our forward-looking statements include, but are not limited to, statements regarding our “expectations,” “hopes,” “beliefs,” “intentions” or “strategies” regarding the future. In addition, any statements that refer to projections, forecasts, or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should” and “would,” as well as similar expressions, may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward looking. Forward-looking statements contained in or incorporated by reference into this prospectus may include, for example, statements about:about the following topics and are subject to certain risks and uncertainties, including the following:
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| ● | our ability to integrate the sale of products acquired as part of the acquisition of Surgalign SPV, Inc.; | |
| ● | the effect of inflation and supply chain disruptions, which could result in delayed product launches, lost revenue, higher costs, decreased profit margins, and other adverse effects on our business and operating results; | |
| ● | the effect of a global | |
| ● | the effect of labor and staffing shortages at hospitals and other medical facilities on the number of elective procedures in which our products are used and as a result our revenues, as well as global and local labor shortages and loss of personnel, which have adversely affected and may continue to adversely our ability to produce product to meet demand; | |
| ● | our ability to service our debt and comply with the covenants in our Credit Agreements; | |
| ● | our ability to maintain sufficient liquidity to fund our operations and obtain financing on reasonable terms when needed; | |
| ● | the effect of COVID-19 and current and future variants on our business, operating results and financial condition, including | |
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| ● | risks associated with and the effect of a shift in procedures using our products from hospitals to ambulatory surgical centers, which would put pressure on the price of our products and margins; | |
| ● | our ability to obtain and maintain government and third-party coverage and reimbursement for our products; | |
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The forward-looking statements contained in this prospectus or in any documents incorporated by reference are based on our current expectations and beliefs concerning future developments and their potential effects on us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties, or assumptions, many of which are beyond our control, which may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described in this prospectus, see “Risk Factors” beginning on page 3 of this prospectus, and our most recent Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 24, 2021.March 7, 2023, and our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2023, filed with the SEC on May 4, 2023.
Should one or more of these risks or uncertainties materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements. We caution you that the forward-looking statements contained in this prospectus are not guarantees of future performance, and we cannot assure you that those statements will be realized or that the forward-looking events and circumstances will occur. All forward-looking statements speak only as of the date of this prospectus. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. The cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf.
You should also read carefully the factors described in the “Risk Factors” in our most recent Annual Report on Form 10-K for the year ended December 31, 2020,2022, filed with the SEC on February 24, 2021March 7, 2023, our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2023, filed with the SEC on May 4, 2023, and in any other documents incorporated by reference into this prospectus, as updated by our future filings, to better understand significant risks and uncertainties inherent in our business and underlying any forward-looking statements. As a result of these factors, actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements in this report, and you should not place undue reliance on any forward-looking statements.
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Unless otherwise indicatedWe are filing the registration statement of which this prospectus is a part to permit holders of our common stock described in the section entitled “Selling Stockholders,” beginning on page 14 of this prospectus, supplement, we intend to use the net proceeds from the sale ofresell such shares. We are not selling any securities and relatedunder this prospectus supplement for working capital and general corporate purposes. The prospectus supplement relating to a particular offering of securities by us will identify the use of proceeds for that offering. We may find it necessary or advisable to use the net proceeds for other purposes, and we will have broad discretion in the application of the proceeds.
We will not receive any proceeds from the sale of our securities ownedshares by the selling stockholders.
We will bear all expenses incurred in connection with the performance of our obligations under the Registration Rights Agreement, as defined below, and will reimburse the selling stockholders for the reasonable fees and disbursements of one firm or counsel to act as counsel for the selling stockholders in connection with the offering made by the selling stockholders.Agreement.
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We will set forth in a prospectus supplement the following information regarding any material dilution of the equity interests of investors purchasing securities in an offering under this prospectus:
GeneralSECURITIES
The following description, together with the additional information we include in any applicable prospectus supplement, summarizes the material terms and provisions of our common stock and preferred stock and does not purport to be complete. It is subject to and qualified in its entirety by reference to the provisions of our Amended and Restated Certificate of Incorporation (“Charter”), Second Amended and RestatedCharter, Bylaws (“Bylaws”) and the Investor Rights Agreement, with OrbiMed Royalty Opportunities II, LP (“Royalty Opportunities”) and ROS Acquisition Offshore LP (“ROS”), dated February 14, 2018 (the “Investor Rights Agreement”), which are filed as exhibits to the registration statement that includes this prospectus and are incorporated by reference herein. We encourage you to read our Charter, our Bylaws, the Investor Rights Agreement and the applicable provisions of the Delaware General Corporation Law (“DGCL”)DGCL for additional information.
Authorized and Outstanding Capital Stock
Our Charter provides that we have authority to issue (i) 300 million300,000,000 shares of our common stock, par value $0.000001 per share, 86,707,286128,897,048 of which are issued and outstanding as of May 10, 2021July 6, 2023 and (ii) 10,000,000 shares of preferred stock, par value $0.000001 per share, none of which are issued and outstanding as of the date of this prospectus. As of May 10, 2021,July 6, 2023, we had outstanding warrants to purchase 7,532,39012,187,470 shares of our common stock, stock options to purchase 2,176,2723,403,192 shares of our common stock and restricted stock unit awards covering 2,258,9823,282,898 shares of our common stock under the Xtant Medical Holdings, Inc. Second Amended and Restated 2018 Equity Incentive Plan, options to purchase 14,49512,012 shares of our common stock under our prior equity compensation plan, and 3,507,1657,387,813 shares available for issuance under the Xtant Medical Holdings, Inc. Second Amended and Restated 2018 Equity Incentive Plan.
Our preferred stock may be issued from time to time in one or more series. The Board of Directors is authorized, by resolution or resolutions, to fix the number of shares of any series of preferred stock and to determine the designation, powers, rights, preferences, qualifications, limitations, privileges and restrictions, if any, of any wholly unissued series of preferred stock, including without limitation, authority to fix by resolution or resolutions the dividend rights, dividend rate, conversion rights, voting rights, rights and terms of redemption (including sinking fund provisions), redemption price or prices and liquidation preferences of any such series, and the number of shares constituting any such series and the designation thereof, or any of the foregoing.
We may amend from time to time our Charter to increase the number of authorized shares of common stock or preferred stock. Any such amendment would require the approval of the holders of a majority of the voting power of the shares entitled to vote thereon. In addition, pursuant to our Charter, the Board of Directors is authorized to increase (but not above the total number of authorized shares of the class) or decrease (but not below the number of shares of any such series then outstanding) the number of shares of any series (including a series of preferred stock), the number of which was fixed by it, subsequent to the issuance of shares of such series then outstanding, subject to certain limitations, without the vote of our stockholders.
Common Stock
Voting Rights
Each holder of our common stock is entitled to one vote per share on each matter submitted to a vote at a meeting of stockholders, including in all elections for directors. Stockholders are not entitled to cumulative voting in the election of directors. Subject to applicable law and the rights, if any, of the holders of outstanding shares of any series of preferred stock we may designate and issue in the future, holders of our common stock are entitled to vote on all matters on which stockholders are generally entitled to vote.
Our stockholders may vote either in person or by proxy. At all meetings of stockholders for the election of directors at which a quorum is present, a plurality of the votes cast shall be sufficient to elect. All other elections and questions presented to the stockholders at a meeting at which a quorum is present shall, unless otherwise provided by our Charter, our Bylaws, the rules or regulations of any stock exchange applicable to us or applicable law or pursuant to any regulation applicable to us or our securities, be decided by the affirmative vote of the holders of a majority in voting power of the shares of our stock that are present in person or by proxy and entitled to vote thereon.
Dividends
Our Board of Directors may authorize, and we may make, distributions to our stockholders, subject to any restriction in our Charter and to those limitations prescribed by law and contractual restrictions. Subject to preferences that may apply to any shares of preferred stock outstanding at the time, the holders of our common stock will be entitled to share equally, identically and ratably in any dividends that the Board of Directors may determine to issue from time to time.
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Liquidation Rights
Upon liquidation, dissolution or winding up, all holders of our common stock are entitled to participate pro rata in our assets available for distribution, subject to applicable law and the rights, if any, of the holders of any class of preferred stock then outstanding.
Other Rights and Preferences
Under the terms of our Charter and Bylaws, holders of our common stock have no preemptive rights, conversion rights or subscription rights, and there are no redemption or sinking fund provisions applicable to our common stock. The rights, preferences and privileges of the holders of our common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of preferred stock that the Board of Directors may designate and issue in the future. Our Charter and Bylaws do not restrict the ability of a holder of our common stock to transfer his, her or its shares of our common stock. All shares of our common stock currently outstanding are fully paid and non-assessable.
Transfer Agent
The transfer agent for our common stock is EQ Shareowner Services.Broadridge Corporate Issuer Solutions, Inc.
Principal Market for our Common StockExchange Listing
Our common stock is listed on NYSE American under the symbol “XTNT.”
Preferred Stock
Our preferred stock may be issued from time to time in one or more series. The Board of Directors is authorized, by resolution or resolutions, to fix the number of shares of any series of preferred stock and to determine the designation, powers, rights, preferences, qualifications, limitations, privileges and restrictions, if any, of any wholly unissued series of preferred stock, including without limitation, authority to fix by resolution or resolutions the dividend rights, dividend rate, conversion rights, voting rights, rights and terms of redemption (including sinking fund provisions), redemption price or prices and liquidation preferences of any such series, and the number of shares constituting any such series and the designation thereof, or any of the foregoing.
Anti-Takeover Provisions of Certain Provisions of our Charter, Bylaws and Investor Rights Agreement and Our Status as a Controlled Company
Anti-takeover provisions in our Charter, Bylaws and Investor Rights Agreement and our status as a controlled company may discourage or prevent a change in control, even if such a sale could be beneficial to our stockholders.
Charter and Bylaws
Our Charter and Bylaws contain the following anti-takeover provisions that may have an anti-takeover effect of delaying, deferring or preventing a change in control of the Company:
| ● | We have shares of common stock and preferred stock available for issuance without stockholder approval. The existence of unissued and unreserved common stock and preferred stock may enable the Board of Directors to issue shares to persons friendly to current management or to issue preferred stock with terms that could render more difficult or discourage a third-party attempt to obtain control of us by means of a merger, tender offer, proxy contest or otherwise, thereby protecting the continuity of our management. | |
| ● | Shares of our common stock do not have cumulative voting rights in the election of directors, so our stockholders holding a majority of the shares of | |
| ● | Special meetings of the stockholders may be called only by the Board of Directors, the chairman of the Board of Directors or the chief executive officer. | |
| ● | The Board of Directors may adopt, alter, amend or repeal our Bylaws without stockholder approval. | |
| ● | Unless otherwise provided by law, any newly created directorship or any vacancy occurring on the Board of Directors for any cause may be filled by the affirmative vote of a majority of the remaining members of the Board of Directors, even if such majority is less than a quorum, and any director so elected shall hold office until the expiration of the term of office of the director whom he or she has replaced or until his or her successor is elected and qualified. | |
| ● | The affirmative vote of the holders of at least two-thirds of the voting power of the then outstanding shares of our capital stock entitled to vote generally in the election of directors, voting together as a single class, is required to amend or repeal the provisions of our Charter related to the amendment of our Bylaws, the Board of Directors and our stockholders as well as the general provisions of our Charter. | |
| ● | Stockholders must follow advance notice procedures to submit nominations of candidates for election to the Board of Directors at an annual or special meeting of our stockholders and must follow advance notice procedures to submit other proposals for business to be brought before an annual meeting of our stockholders. | |
| ● | Unless we consent in writing to an alternative forum, the Court of Chancery of the State of Delaware will be the exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Company to us or our stockholders, (iii) any action asserting a claim arising under any provision of the DGCL, our Charter or our Bylaws, or (iv) any action asserting a claim governed by the internal-affairs doctrine. Notwithstanding the foregoing, Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder and Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder. As a result, the exclusive forum provision will not apply to suits brought to enforce any duty or liability created by the Exchange Act, the Securities Act, or any other claim for which the federal courts have exclusive jurisdiction. |
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Investor Rights Agreement
We are party to an Investor Rights Agreement, which includes certain provisions that may have an anti-takeover effect of delaying, deferring or preventing a change in control of the Company. The Investor Rights Agreement includes director nomination rights, which provide that so long as the Ownership Threshold (as defined in the Investor Rights Agreement) is met, Royalty Opportunities and ROS are entitled to nominate such individuals to the Board of Directors constituting a majority of the directors. In addition, under the Investor Rights Agreement, so long as the Ownership Threshold is met, certain matters require the approval of Royalty Opportunities and ROS to proceed with such a transaction, including without limitation, the sale, transfer or other disposition of assets or businesses of the Company or its subsidiaries with a value in excess of $250,000 in the aggregate during any fiscal year (other than sales of inventory or supplies in the ordinary course of business, sales of obsolete assets (excluding real estate), sale-leaseback transactions and accounts receivable factoring transactions).
Pursuant to the registration rights agreement, Royalty Opportunities and ROS also have incidental or “piggyback” registration rights with respect to any registrable shares. Under the agreement, we have agreed to bear the expenses, including the fees and disbursements of one legal counsel for Royalty Opportunities and ROS, in connection with the registration of the registrable securities, except for any underwriting commissions relating to the sale of the registrable securities.
Registration Rights
Effective October 1, 2020, we entered into a Registration Rights Agreement with Royalty Opportunities and ROS (the “Registration Rights Agreement”), which requires us, among other things, to file with the SEC a shelf registration statement covering the resale, from time to time, of our common stock that was issued pursuant to the Share Issuance, as defined below, no later than December 30, 2020 and use our best efforts to cause the shelf registration statement to become effective under the Securities Act no later than March 30, 2021. The registration statement was filed on December 18, 2020 pursuant to our obligations under the Registration Rights Agreement and became effective on December 23, 2020.
Controlled Company Status
We are a “controlled company” as defined in section 801(a) of the NYSE American Company Guide because more than 50% of the combined voting power of all of our outstanding common stock is beneficially owned by OrbiMed Advisors LLC (“OrbiMed Advisors”).LLC. Our status as a controlled company may have an anti-takeover effect of delaying, deferring or preventing a change in control of the Company.
Participation Right
Under the terms of the Securities Purchase Agreement between us and an institutional accredited investor (the “Investor”), dated February 22, 2021 (the “Securities Purchase Agreement”), we agreed that in the event we or any of our subsidiaries proposes to offer and sell shares of our common stock or certain common stock equivalents to non-strategic investors primarily for capital raising purposes, we will provide the Investor the right, but not the obligation, to participate in such offering in an amount of up to 25% of the securities offered in such offering. This participation right expires upon the earlier of 12 months after the closing of the private placement we closed on February 24, 2021 or upon the occurrence of certain change in control events.
Section 203 of the DGCL
We have elected to be subject to Section 203 of the DGCL (“Section 203”), and we are prohibited from engaging in any business combination with any interested stockholder for a period of three years after the date that such stockholder became an interested stockholder, with the following exceptions:
| ● | before such date, the Board of Directors approved either the business combination or the transaction that resulted in the stockholder becoming an interested stockholder; | |
| ● | upon completion of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting shares outstanding at the time the transaction began, excluding for purposes of determining the voting shares outstanding (but not the outstanding voting shares owned by the interested stockholder) those shares owned (i) by persons who are directors and also officers and (ii) employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or | |
| ● | on or after such date, the business combination is approved by the Board of Directors and authorized at an annual or special meeting of the stockholders, and not by written consent, by the affirmative vote of at least 66-2/3% of the outstanding voting shares that are not owned by the interested stockholder. |
In general, Section 203 defines business combination to include the following:
| ● | any merger or consolidation involving the | |
| ● | any sale, transfer, pledge or other disposition of 10% or more of the assets of the | |
| ● | subject to certain exceptions, any transaction that results in the issuance or transfer by the | |
| ● | any transaction involving the | |
| ● | the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits by or through the |
In general, by reference to Section 203, an “interested stockholder” is an entity or person who, together with the person’s affiliates and associates, beneficially owns, or within three years prior to the time of determination of interested stockholder status owned, 15% or more of the outstanding voting shares of the Company.company.
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Limitations of Liability and Indemnification Matters
We have adopted provisions in our Charter that limit or eliminate the liability of our directors for monetary damages for breach of their fiduciary duties, except for a breach of the duty of loyalty to our Company or its stockholders, for acts or omissions not in good faith or involving intentional misconduct or a knowing violation of law, or for any transaction from which a director derived an improper personal benefit. Accordingly, our directors will not be personally liable for monetary damages for breach of their fiduciary duties as directors, except with respect to the following:
| ● | any breach of their duty of loyalty to us or our stockholders; | |
| ● | acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law; | |
| ● | unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the DGCL; or | |
| ● | any transaction from which the director derived an improper personal benefit. |
This limitation of liability does not apply to liabilities arising under the federal securities laws and does not affect the availability of equitable remedies such as injunctive relief or rescission. If Delaware law is amended to authorize the further elimination or limiting of director liability, then the liability of our directors will be eliminated or limited to the fullest extent permitted by Delaware law as so amended.
Our Bylaws provide for mandatory indemnification of directors and officers to the maximum extent allowed by applicable law. We believe that indemnification under our Bylaws covers at least negligence and gross negligence on the part of indemnified parties. In addition, we have also entered into indemnification agreements with our directors and officers, pursuant to which we must:
| ● | indemnify officers and directors against certain liabilities that may arise because of their status as officers and directors; | |
| ● | advance expenses, as incurred, to officers and directors in connection with a legal proceeding subject to limited exceptions; and | |
| ● | cover officers and directors under any general or directors’ and officers’ liability insurance policy maintained by us. |
We also maintain directors’ and officers’ liability insurance.
We believe that these provisions and agreements are necessary to attract and retain qualified persons as directors and executive officers. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling us pursuant to the foregoing provisions, the opinion of the SEC is that such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.
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DESCRIPTION OF WARRANTSSELLING STOCKHOLDERS
The following summary of the general terms and provisions of the warrants represented by warrant agreements and warrant certificates that we may offer using this prospectus and a prospectus supplement is only a summary and does not purport to be complete. You must look at the applicable forms of warrant agreement and warrant certificate for a full understanding of the specific terms of any warrant. The forms of the warrant agreement and the warrant certificate will be filed or incorporated by reference as exhibits to the registration statement to which this prospectus is a part. See “Where You Can Find More Information” for information on how to obtain copies.
A prospectus supplement will describe the specific terms of the warrants offered under that prospectus supplement, including any of the terms in this section that will not apply to those warrants, and any special considerations, including tax considerations, applicable to investing in those warrants.
General
We may issue warrants to purchase shares of our common stock or preferred stock alone or together with other securities offered by the applicable prospectus supplement. The warrants may be issued independently or together with any securities and may be attached to or separate from the securities. We may enter into a warrant agreement with a warrant agent. If we elect to do so, the warrant agent will act solely as our agent in connection with the warrants and will not assume any obligation or relationship of agency or trust for or with any registered holders of warrants or beneficial owners of warrants.
The prospectus supplement relating to any warrants we offer will describe the specific terms relating to the offering. These terms may include some or all of the following:
A holder of warrants may:
Until the warrants are exercised, holders of the warrants will not have any of the rights of holders of the underlying shares of our common stock or preferred stock.
Exercise of Warrants
Each holder of a warrant is entitled to purchase the number of shares of our common stock or preferred stock at the exercise price described in the applicable prospectus supplement. After the close of business on the day when the right to exercise terminates (or a later date if we extend the time for exercise), unexercised warrants will become void.
Holders of warrants may exercise them by:
If you comply with the procedures described above, your warrants will be considered to have been exercised when the warrant agent receives payment of the exercise price. As soon as practicable after you have completed these procedures, we will issue and deliver to you the shares of our common stock or preferred stock that you purchased upon exercise. If you exercise fewer than all of the warrants represented by a warrant certificate, we will issue to you a new warrant certificate for the unexercised amount of warrants.
Amendments and Supplements to Warrant Agreements
We may amend or supplement a warrant agreement or warrant certificates without the consent of the holders of the warrants if the changes are not inconsistent with the provisions of the warrants and do not adversely affect the interests of the holders.
We may, from time to time, issue units comprised of one or more of the other securities described inunder this prospectus in any combination. A prospectus supplement will describe the specific terms of the units offered under that prospectus supplement, and any special considerations, including tax considerations, applicable to investing in those units. You must look at the applicable prospectus supplement and any applicable unit agreement for a full understanding of the specific terms of any units. The form of unit agreement will be filed or incorporated by reference as an exhibit to the registration statement to which this prospectus is a part. See “Where You Can Find More Information” for information on how to obtain copies.
This prospectus also relates to the offer and sale from time to time of up to 18,218,374 shares of our common stock that may be offered from time to time by the selling stockholders named below or by any of their respective pledgees, donees, pledgees, transferees assignees or other successors-in-interest. As used in this prospectus, the term “selling stockholder”stockholders” includes thosethe selling stockholders identified below and any donees, pledgees, transferees assignees or other successors-in-interest selling shares received after the date of this prospectus from a selling stockholder as a gift, pledge or other non-sale related transfer. The selling stockholders named below acquired the shares of our common stock being offered under this prospectus directly from us following the Private Placement. We issued the shares to the selling stockholders in reliance on an exemption from the registration requirements of the Securities Act pursuant to Section 4(a)(2) of the Securities Act and Rule 506 promulgated thereunder.
The following table sets forth as of May 10, 2021:July 6, 2023: (1) the name of each selling stockholder for whom we are registering shares of our common stock under the registration statement of which this prospectus is a part, (2) the number of shares of our common stock beneficially owned by each of the selling stockholders prior to the offering, determined in accordance with Rule 13d-3 under the Securities Exchange Act, of 1934, as amended (the “Exchange Act”), (3) the number of shares of our common stock that may be offered by each selling stockholder under this prospectus and (4) the number of shares of our common stock to be owned by each selling stockholder after completion of this offering. We will not receive any of the proceeds from the sale of the shares of our common stock offered under this prospectus. The amounts and information set forth below are based upon information provided to us by the selling stockholders or their representatives, or on our records, as of May 10, 2021.July 6, 2023. The percentage of beneficial ownership for the following table is based on 86,707,286128,897,048 shares of our common stock outstanding as of May 10, 2021.July 6, 2023.
To our knowledge, except as indicated in the footnotes to this table, each stockholder named in the table has sole voting and investment power with respect to all shares of our common stock shown in the table to be beneficially owned by such stockholder. Except as described below, none of the selling stockholders has had any position, office or other material relationship with us or any of our predecessors or affiliates within the past three years. In addition, based on information provided to us, none of the selling stockholders that are affiliates of broker-dealers, if any, purchased the shares of our common stock outside the ordinary course of business or, at the time of their acquisition of such shares, had any agreements, understandings or arrangements with any other persons, directly or indirectly, to dispose of the shares. Information concerning the selling stockholders may change from time to time, and any changed information will be set forth in supplements to this prospectus to the extent required.
| Shares Beneficially Owned Prior to the Offering | Number of Shares Being | Shares Beneficially Owned After Completion of the Offering | ||||||||||||||||||
| Name of Selling Stockholder | Number(1) | Percentage | Offered | Number | Percentage | |||||||||||||||
| ROS Acquisition Offshore LP(2) | 55,820,296 | 64.4 | % | 13,955,092 | 41,865,204 | 48.3 | % | |||||||||||||
| OrbiMed Royalty Opportunities II, LP(3) | 17,053,198 | 19.7 | % | 4,263,282 | 12,789,916 | 4.9 | % | |||||||||||||
| TOTAL | 72,873,494 | 18,218,374 | 54,655,120 | |||||||||||||||||
Shares Beneficially Owned Prior to the Offering | Number of Shares Being | Shares Beneficially Owned After Completion of the Offering | ||||||||||||||||||
| Name of Selling Stockholder | Number | Percentage | Offered | Number | Percentage | |||||||||||||||
| Altium Growth Fund, LP(1) | 16,725,477 | 9.9 | % | 4,000,000 | 12,725,477 | 9.4 | % | |||||||||||||
| Incept, LLC(2) | 5,140,602 | 4.0 | % | 1,333,334 | 3,807,268 | 2.9 | % | |||||||||||||
| Lytton-Kambara Foundation(3) | 4,829,814 | 3.8 | % | 4,800,000 | 29,814 | * | ||||||||||||||
| Blackwell Partners LLC – Series A(4) | 2,520,175 | 2.0 | % | 2,520,175 | — | * | ||||||||||||||
| John Lipman(5) | 2,201,210 | 1.7 | % | 1,566,665 | 634,545 | * | ||||||||||||||
| Claudio Da Re(6) | 1,919,090 | 1.5 | % | 400,000 | 1,519,090 | 1.2 | % | |||||||||||||
| Lightsail Partners, LP(7) | 1,301,212 | 1.0 | % | 666,667 | 634,545 | * | ||||||||||||||
| NCP RFM LP(8) | 796,376 | * | 796,376 | — | * | |||||||||||||||
| SEP FBO Norman H Pessin Pershing LLC as Custodian(9) | 666,667 | * | 666,667 | — | * | |||||||||||||||
| Steve Dyer(10) | 466,667 | * | 266,667 | 200,000 | * | |||||||||||||||
| Nantahala Capital Partners Limited Partnership(11) | 464,659 | * | 464,659 | — | * | |||||||||||||||
| James J. Tiampo Money Purchase Plan & Trust (Keogh) – Roth Portion(12) | 333,333 | * | 333,333 | — | * | |||||||||||||||
| Kevin Harris(13) | 300,000 | * | 300,000 | — | * | |||||||||||||||
| William F. Hartfiel III(14) | 300,000 | * | 300,000 | — | * | |||||||||||||||
| Bradley W. Baker(15) | 266,667 | * | 266,667 | — | * | |||||||||||||||
| James H. Zavoral Jr.(16) | 266,667 | * | 266,667 | — | * | |||||||||||||||
| MTX Capital LP(17) | 266,666 | * | 266,666 | — | * | |||||||||||||||
| Nantahala Capital Partners II Limited Partnership(18) | 218,790 | * | 218,790 | — | * | |||||||||||||||
| Joshua Thomas | 200,000 | * | 200,000 | — | * | |||||||||||||||
| MAZ Partners LP(19) | 200,000 | * | 200,000 | — | * | |||||||||||||||
| Tom Emmel(20) | 133,333 | * | 133,333 | — | * | |||||||||||||||
| John O’Brien(21) | 33,334 | * | 33,334 | — | * | |||||||||||||||
| Total | 39,550,739 | 20,000,000 | ||||||||||||||||||
* Less than 1%
| (1) | Based |
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| (2) | Farhad Khosravi has voting and investment |
| (3) | Laurence Lytton has voting and investment control over the shares of common stock held by the Lytton-Kambara Foundation. |
| (4) | Nantahala Capital Management, LLC is a |
| (5) | These shares of common stock are held directly by Mr. Lipman. Mr. Lipman is an affiliate of a broker-dealer, Craig-Hallum Capital Group LLC (“Craig-Hallum”), and has represented to us that (1) he purchased the shares in the ordinary course of business and (2) at the time of purchase, he had no agreements or understandings, directly or indirectly, with any person to distribute the shares. The number of shares includes 126,909 shares of our common stock issuable upon exercise of warrants. |
| (6) | The number of shares includes 253,818 shares of our common stock issuable upon exercise of warrants. |
| (7) | James Basili has voting and investment control over the shares of common stock held by Lightsail Partners, LP. The number of shares includes 126,909 shares of our common stock issuable upon exercise of warrants. |
| (8) | Nantahala Capital Management, LLC is a Registered Investment Adviser and has been delegated the legal power to vote and/or direct the disposition of such securities on behalf of the selling stockholder as a |
| (9) | Norman H. Pessin has voting and investment control over the shares of common stock held by SEP FBO Norman H Pessin Pershing LLC as Custodian. |
| (10) | These shares of common stock are held directly by Mr. Dyer. Mr. Dyer is an affiliate of a broker-dealer, Craig-Hallum, and has represented to us that (1) he purchased the shares in the ordinary course of business and (2) at the time of purchase, he had no agreements or understandings, directly or indirectly, with any person to distribute the shares. |
| (11) | Nantahala Capital Management, LLC is a Registered Investment Adviser and has been delegated the legal power to vote and/or direct the disposition of such securities on behalf of the selling stockholder as a |
| (12) | James J. Tiampo has voting and investment control over the shares of common stock held by James J. Tiampo Money Purchase Plan & Trust (Keogh) – Roth Portion. |
| (13) | These shares of common stock are held directly by Mr. Harris. Mr. Harris is an affiliate of a broker-dealer, Craig-Hallum Capital Group LLC (Craig-Hallum), and has represented to us that (1) he purchased the shares in the ordinary course of business and (2) at the time of purchase, he had no agreements or understandings, directly or indirectly, with any person to distribute the shares. |
| (14) | These shares of common stock are held directly by Mr. Hartfiel. Mr. Hartfiel is an affiliate of a broker-dealer, Craig-Hallum, and has represented to us that (1) he purchased the shares in the ordinary course of business and (2) at the time of purchase, he had no agreements or understandings, directly or indirectly, with any person to distribute the shares. |
| (15) | These shares of common stock are held directly by Mr. Baker. Mr. Baker is an affiliate of a broker-dealer, Craig-Hallum, and has represented to us that (1) he purchased the shares in the ordinary course of business and (2) at the time of purchase, he had no agreements or understandings, directly or indirectly, with any person to distribute the shares. |
| (16) | These shares of common stock are held directly by Mr. Zavoral. Mr. Zavoral is an affiliate of a broker-dealer, Craig-Hallum, and has represented to us that (1) he purchased the shares in the ordinary course of business and (2) at the time of purchase, he had no agreements or understandings, directly or indirectly, with any person to distribute the shares. |
| (17) | Harris Heyer has voting and investment control over the shares of common stock held by MTX Capital LP. |
| (18) | Nantahala Capital Management, LLC is a Registered Investment Adviser and has been delegated the legal power to vote and/or direct the disposition of such securities on behalf of the selling stockholder as a General Partner, Investment Manager, or Sub-Advisor and would be considered the beneficial |
| (19) | Walter Schenker is the principal and control person of MAZ Partners LP. |
| (20) | These shares of common stock are held directly by Mr. Emmel. Mr. Emmel is an affiliate of a broker-dealer, Craig-Hallum, and has represented to us that (1) he purchased the shares in the ordinary course of business |
| (21) | These shares of common stock are held directly by Mr. O’Brien. Mr. O’Brien is an affiliate of a broker-dealer, Craig-Hallum, and has represented to us that (1) he purchased the shares in the ordinary course of business and (2) at the time of purchase, he had no agreements or understandings, directly or indirectly, with any person to distribute the shares. |
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Material Relationships Between Selling Stockholders and Xtant
Lock-Up Agreement
2023 Private Placement
On February 24, 2021,July 3, 2023, we entered into Lock-Up Agreements with our directors Matthew Rizzo and Michael Eggenberg, both of whom are employees of OrbiMed Advisors, pursuant to the Securities Purchase Agreement dated aswith the Investors, pursuant to which we agreed to issue an aggregate of February 22, 2021, between us20,000,000 shares of common stock in a Private Placement at a per share purchase price of $0.75. The closing of the Private Placement occurred on July 6, 2023. We received gross proceeds of approximately $15.0 million before deducting estimated offering expenses payable by the Company. We expect to use the net proceeds from the Private Placement for working capital and other general corporate purposes.
Under the purchasers signatory thereto. Pursuantterms of the Securities Purchase Agreement, each of our directors and executive officers entered into lock-up agreements with the Company pursuant to the Lock-Up Agreements, Mr. Rizzo and Mr. Eggenberg, among other things,which they agreed, subject to certain customary exceptions, not to offer, sell, contract to sell, hypothecate, pledge or otherwise dispose of (or enter into any transaction which is designateddesigned to, or might reasonably be expected to, result in the disposition (whether by actual disposition or effective economic disposition due to cash settlement or otherwise) by the undersigned or any affiliate or any person in privity), directly or indirectly, or establish or increase a put equivalent position or liquidate or decrease a call equivalent position, within the meaning of Section 16 of the Exchange Act with respect to, any shares of our common stock or securities convertible, exchangeable or exercisable into, shares of our common stock beneficially owned, held or hereafter acquired by Mr. Rizzosuch director or Mr. Eggenberg. The lock-up period has a 90-day duration and expires on May 25, 2021.executive officer.
TerminationUnder the terms of Second Amended and Restated Creditthe Securities Purchase Agreement,
On May 6, 2021, the Company, as guarantor, and its subsidiaries, as borrowers (collectively, the “Borrowers”), we entered into a (i) Credit, Security and Guarantythe Registration Rights Agreement (Term Loan) (the “Term Credit Agreement”) with MidCap Financial Trust, in its capacity as agent (the “Agent”) and a lender and the additional lenders from time to time party thereto and (ii) Credit, Security and Guaranty Agreement (Revolving Loan) (the “Revolving Credit Agreement,” and, together with the Term Credit Agreement,Investors at the “Credit Agreements”),closing of the Private Placement pursuant to which we agreed to prepare and file a Resale Registration Statement with the AgentSEC within 30 days of the date of the closing for purposes of registering the resale of the Registrable Securities. The registration statement of which this prospectus is a part has been filed to satisfy this obligation. Under the terms of the Registration Rights Agreement, we agreed to use commercially reasonable best efforts to cause the Resale Registration Statement to be declared effective by the SEC within 60 days of the closing of the closing (90 days in the event the Resale Registration Statement is reviewed by the SEC). If we fail to meet the specified filing deadlines or keep the Resale Registration Statement effective, subject to certain permitted exceptions, we will be required to pay liquidated damages to the Investors. We also agreed, among other things, to indemnify the selling stockholders from certain liabilities and the lenders from time to time party thereto. On May 6, 2021, contemporaneouslypay all fees and expenses incident to our performance of or compliance with the execution and delivery of the new Credit Agreements, that certain Second Amended and Restated Credit Agreement, dated March 29, 2019, among the Company, the Borrowers, OrbiMed Royalty Opportunities II, LP (“Royalty Opportunities”) and ROS Acquisition Offshore LP, as subsequently amended (the “Second A&R Credit Agreement”), was terminated in accordance with the terms thereof and all outstanding amounts were repaid by the Borrowers to Royalty Opportunities in its role as sole lender thereunder.Registration Rights Agreement.
2020 Restructuring Agreement2022 Private Placement
On August 7, 2020,23, 2022, we entered into the Restructuring Agreementa securities purchase agreement with Royalty Opportunities and ROS,several investors, pursuant to which the parties theretowe agreed subject to the terms and conditions set forth therein, to complete certain restructuring transactions (the “Restructuring Transactions”) in furtheranceissue an aggregate of a restructuring of our outstanding indebtedness under the Second A&R Credit Agreement. The Restructuring Transactions included, among others, an amendment to our Charter to increase the number of authorized20,305,429 shares of our common stock from 75 millionand warrants to 300 million (the “Charter Amendment”), the issuance of approximately 57.8 million shares of our common stock (the “Share Issuance”), the execution of an amendment to the Second A&R Credit Agreement by the parties thereto to change certain provisions therein, and the launch of a rights offering.
Immediately after the execution of the Restructuring Agreement by the parties thereto, we solicited and obtained the written consent of Royalty Opportunities and ROS, the holders ofpurchase an aggregate of 9,248,6785,076,358 shares of our common stock asat a per unit (each unit consisting of August 7, 2020 (the “Consenting Majority Stockholders”), representingone share of common stock and a majoritywarrant to purchase 0.25 of a share of common stock) purchase price of $0.48, which represents a 2.5% discount to the 10-day volume-weighted average price of the outstandingcommon stock ending August 19, 2022. Additionally, we agreed that in the event we, or any of our subsidiaries, propose to offer and sell shares of our common stock asor certain common stock equivalents primarily for capital raising purposes, we would provide the 2022 private placement investors the right, but not the obligation, to participate in such offering in an aggregate amount of such date, for the approvalup to 20% of the Charter Amendment andsecurities offered in such offering, subject to certain customary exceptions. This participation right will expire upon the Share Issuance,earlier of October 7, 2023 or the occurrence of certain change in accordance with applicable provisions of the DGCL and the Company’s Bylaws. The written consent of the Consenting Majority Stockholders was sufficient to approve the Charter Amendment and the Share Issuance. Therefore, no proxies or additional consents were solicited by us in connection with the Charter Amendment and the Share Issuance. Pursuant to Section 14(c) of the Exchange Act, and the rules and regulations promulgated thereunder, on September 10, 2020, we sent a definitive information statement to all holders of our common stock as of August 7, 2020 for the purpose of informing such stockholders of the written actions taken by the Consenting Majority Stockholders. In accordance with Exchange Act Rule 14c-2, the stockholder consent of the Consenting Majority Stockholders could not become effective until at least 20 calendar days following the mailing of the information statement.
On October 1, 2020, the closing of the Restructuring Transactions, other than the rights offering, occurred, and in connection therewith, the following actions took place:
control events. As a result of the completion2022 private placement, we received gross proceeds of these Restructuring Transactions, Royalty Opportunitiesapproximately $9.75 million before deducting estimated offering expenses payable by the Company. The first closing of the 2022 private placement occurred on August 25, 2022, and ROS owned immediately thereafter,the second closing of the private placement occurred on October 7, 2022, at which time we entered into a registration rights agreement with the investors. John Lipman, Incept, LLC, Lightsail Partners, LP and Claudio Da Re participated in the aggregate, approximately 94.5% of2022 private placement as well as our outstanding common stock, and all other existing stockholders of the Company owned approximately 5.5% of our outstanding common stock.recent Private Placement.
Pursuant2021 Private Placement
On February 22, 2021, we entered into a securities purchase agreement, pursuant to the terms of the Restructuring Agreement,which we commenced the rights offeringagreed to allow our stockholders as of the November 5, 2020 record date to purchase up toissue an aggregate of 14,018,6908,888,890 shares of our common stock at a subscriptionpurchase price of $1.07$2.25 per share and warrants to purchase up to 6,666,668 shares of our common stock. The closing of the same price per share as the $1.07 per share exchange price used2021 private placement occurred on February 24, 2021. Altium Growth Fund, LP participated in the Share Issuance. The rights offering expired on December 4, 2020. We issued 712,646 shares of common stock in the rights offering and received $762,531 in gross proceeds.2021 private placement as well as our recent Private Placement.
2020 Registration Rights Agreement
Effective October 1, 2020, we entered into the Registration Rights Agreement which requires us, among other things, to file with the SEC a shelf registration statement covering the resale, from time to time, of our common stock that was issued pursuant to the Share Issuance, as defined below, no later than December 30, 2020 and use our best efforts to cause the shelf registration statement to become effective under the Securities Act no later than March 30, 2021. The registration statement was filed on December 18, 2020 pursuant to our obligations under the Registration Rights Agreement and became effective on December 23, 2020.
Second A&R Credit Agreement and Warrant IssuanceCraig-Hallum
On MarchJune 29, 2019, the Company and our subsidiaries, Bacterin International, Inc., Xtant Medical, Inc. and X-spine Systems, Inc., entered into the Second A&R Credit Agreement with Royalty Opportunities and ROS, which amended and restated the prior Amended and Restated Credit Agreement dated as of July 27, 2015 among the parties thereto (the “Prior Credit Agreement”), and as subsequently amended through the Twenty-Fifth Amendment to the Amended and Restated Credit Agreement to change certain provisions therein. Under the Second A&R Credit Agreement:
On April 1, 2019, the Company issued warrants to purchase an aggregate of 1.2 million shares of our common stock to Royalty Opportunities and ROS, with an exercise price of $0.01 per share and an expiration date of April 1, 2029. The issuance of these warrants was a condition to the effectiveness of the Second A&R Credit Agreement. These warrants have subsequently been exercised in full.
First Amendment to Second Amended and Restated Credit Agreement and Warrant Issuance
On May 6, 2020, the Company and our subsidiaries, Bacterin International, Inc., Xtant Medical, Inc. and X-spine Systems, Inc., entered into a First Amendment to the Second Amended and Restated Credit Agreement with Royalty Opportunities and ROS (the “First Amendment”), which among other things, provided that:
In conjunction therewith, the Company issued warrants to purchase an aggregate of 2.4 million shares of our common stock to Royalty Opportunities and ROS, with an exercise price of $0.01 per share and an expiration date of May 6, 2030. The issuance of these warrants was a condition to the effectiveness of the First Amendment. These warrants have subsequently been exercised in full.
Second Amendment to Second Amended and Restated Credit Agreement and Warrant Issuance
On October 1, 2020, pursuant to the Restructuring Transactions discussed above, the Company and our subsidiaries, Bacterin International, Inc., Xtant Medical, Inc. and X-spine Systems, Inc., entered into a Second Amendment to the Second Amended and Restated Credit Agreement with Royalty Opportunities and ROS (the “Second Amendment”), which among other things, provided for:
Prior Amendments to Prior Credit Agreement and Warrant Issuance
Prior to the execution of the Second A&R Credit Agreement, the Company and our subsidiaries, Bacterin International, Inc., Xtant Medical, Inc. and X-spine Systems, Inc., and Royalty Opportunities and ROS entered into several amendments to our Prior Credit Agreement, including those described below.
Effective December 28, 2017, the Company and our subsidiaries, Bacterin International, Inc., Xtant Medical, Inc. and X-spine Systems, Inc., Royalty Opportunities and ROS entered into the Twenty-First Amendment to the Amended and Restated Credit Agreement, which amended the Prior Credit Agreement. This amendment further deferred the Company’s accrued interest payment date until January 31, 2018.
Effective January 30, 2018, the Company and our subsidiaries, Bacterin International, Inc., Xtant Medical, Inc. and X-spine Systems, Inc., Royalty Opportunities and ROS entered into the Twenty-Second Amendment to the Amended and Restated Credit Agreement, which amended the Prior Credit Agreement. This amendment further deferred the Company’s accrued interest payment date until February 28, 2018.
Effective February 14, 2018, the Company and our subsidiaries, Bacterin International, Inc., Xtant Medical, Inc. and X-spine Systems, Inc., Royalty Opportunities and ROS entered into the Twenty-Third Amendment to the Amended and Restated Credit Agreement, which further amended the Prior Credit Agreement and terms of the facility created under such agreement (the “Credit Facility”). As of result of this amendment, the interest payable was carried forward and as modified, the interest rate options within the Credit Facility were as follows: (a) through December 31, 2018, we would have the option at our sole discretion (i) to pay PIK Interest at LIBOR (as defined in the Credit Facility) plus 12% or (ii) pay cash interest at LIBOR plus 10%; (b) beginning January 1, 2019 through June 30, 2019, we would have the option at our sole discretion to either (i) pay PIK Interest at LIBOR plus 15% or (ii) pay cash interest at LIBOR plus 10%; and (c) beginning July 1, 2019 through the maturity date of the Credit Facility, we would pay cash interest at LIBOR plus 10%. The amendment also reduced the prepayment or repayment fee under the Credit Facility to 1%. This amendment also modified the financial covenants in the Prior Credit Agreement, including removing the minimum revenue covenant, providing a minimum liquidity covenant, a consolidated leverage ratio covenant, and a minimum consolidated EBITDA covenant, all as defined in the Prior Credit Agreement.
On September 17, 2018, the Company and our subsidiaries, Bacterin International, Inc., Xtant Medical, Inc. and X-spine Systems, Inc., Royalty Opportunities and ROS entered into the Twenty-Fourth Amendment to the Amended and Restated Credit Agreement, which further amended the Prior Credit Agreement and terms of the Credit Facility, effective as of April 1, 2018. Under the terms of this amendment, no interest would be charged on the loans under the Credit Facility from April 1, 2018 until June 30, 2018. Due to the interest rate relief provided by this amendment, the Company performed an assessment of the changes to the terms of the Credit Facility in accordance with Accounting Standards Codification 470, Debt. The Credit Facility was modified based on an evaluation of the present value of cash flows for the old and new debt instruments. Given the modification, a new effective interest rate of 13.45% for the modified loan was calculated based on the carrying amount of the debt and the present value of the revised future cash flows. The modified interest rate is effective through the remaining life of the loan.
On September 17, 2018, the Company and our subsidiaries, Bacterin International, Inc., Xtant Medical, Inc. and X-spine Systems, Inc., Royalty Opportunities and ROS entered into the Twenty-Fifth Amendment to the Amended and Restated Credit Agreement, which further amended the Prior Credit Agreement and terms of the Credit Facility, effective as of August 1, 2018. Under the terms of this amendment:
On September 17, 2018, the Company issued warrants to purchase an aggregate of 1.2 million shares of Company common stock to Royalty Opportunities and ROS, with an exercise price of $0.01 per share and an expiration date of August 1, 2028. The issuance of these warrants was a condition to the effectiveness of this amendment. These warrants have subsequently been exercised in full.
2018 Restructuring Agreement
On January 11, 2018, we entered into a Restructuring and Exchange Agreement (the “Prior Restructuring Agreement”) with Royalty Opportunities, ROS, and certain other stockholders. Pursuant to the Prior Restructuring Agreement, and following the execution of an amendment to the indenture governing our then outstanding 6% convertible senior unsecured notes due 2021 (the “2017 Notes”), on January 17, 2018, ROS and Royalty Opportunities converted the 2017 Notes, plus accrued and unpaid interest, at the $9.11 per share conversion rate originally provided thereunder, into 189,645 shares of our common stock.
On February 14, 2018, following approval by our stockholders and after completion of the 1-for-12 reverse stock split, the remaining $70.238 million aggregate principal amount of the notes held by the selling stockholders, plus accrued and unpaid interest, was exchanged for newly-issued shares of our common stock at an exchange rate of 138.8889 shares per $1,000 principal amount of notes, for an exchange price of $7.20 per share (the “Notes Exchange”). This resulted in the issuance of 10,401,309 shares of our common stock to Royalty Opportunities, ROS, and certain other stockholders and Royalty Opportunities and ROS acquiring an approximately 70% controlling interest in our outstanding shares of our common stock. Upon completion of the Notes Exchange, all outstanding obligations under our convertible senior secured notes were satisfied in full and the indentures governing such notes were discharged.
Pursuant to the terms of the Prior Restructuring Agreement, we commenced a rights offering to allow our stockholders as of the April 27, 2018 record date to purchase up to an aggregate of 1,137,515 shares of our common stock at a subscription price of $7.20 per share. The rights offering expired on June 18, 2018. We issued 129 shares of common stock in the rights offering and received $0.9 thousand in gross proceeds.
Private Placement SPA
On February 14, 2018, we entered into a Securities Purchase Agreement (the “Private Placement SPA”) with ROS and Royalty Opportunities. Pursuant to the Private Placement SPA, on February 14, 2018, ROS and Royalty Opportunities purchased from us a total of 945,819 shares of our common stock, at a price of $7.20 per share, for aggregate proceeds of $6,809,896. Under the Private Placement SPA, 603,687 of such shares of our common stock were issued to ROS and 342,132 of such shares of common stock were issued to Royalty Opportunities.
Registration Rights Agreement
Effective February 14, 2018, we entered into a Registration Rights Agreement (the “Prior Registration Rights Agreement”) with ROS and Royalty Opportunities and certain other stockholders. The Prior Registration Rights Agreement required us, among other things, to file with the SEC a shelf registration statement within 90 days of the date of the Prior Registration Rights Agreement covering the resale, from time to time, of our common stock issued. The corresponding registration statement became effective on June 4, 2018.
Investor Rights Agreement
Effective February 14, 2018,2023, we entered into an Investor Rights Agreement (the “Investor Rights Agreement”)engagement letter with Royalty Opportunities, ROS, and certain other stockholders. UnderCraig-Hallum. Pursuant to the Investor Rights Agreement, ROS and Royalty Opportunities are permittedengagement letter, we engaged Craig-Hallum to nominate a majority ofact as our placement agent in connection with the directors and designate the chairperson of our Board of Directors at subsequent annual meetings, as long as they maintain an ownership threshold in our Company of at least 40% of our then outstanding common stock (the “Ownership Threshold”). If ROS and Royalty Opportunities are unable to maintain the Ownership Threshold, the Investor Rights Agreement contemplates a reduction of nomination rights commensurate with their ownership interests.Private Placement.
For so long as the Ownership Threshold is met, we must obtain the approval of ROS and Royalty Opportunities to proceed with the following actions: (i) issue new securities; (ii) incur over $250,000 of debt in a fiscal year; (iii) sell or transfer over $250,000 of our assets or businesses or our subsidiaries in a fiscal year; (iv) acquire over $250,000 of assets or properties in a fiscal year; (v) make capital expenditures over $125,000 individually, or $1,500,000 in the aggregate during a fiscal year; (vi) approve our annual budget; (vii) hire or terminate our chief executive officer; (viii) appoint or remove the chairperson of our board of directors; and (ix) make loans to, investments in, or purchase, or permit any subsidiary to purchase, any stock or other securities in another entity in excess of $250,000 in a fiscal year. As long as the Ownership Threshold is met, we may not increase the size of our board or directors beyond seven directors without the approval of a majority of the directors nominated by ROS and Royalty Opportunities.
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The Investor Rights Agreement grants Royalty Opportunities, ROS, and certain other stockholders the right to purchase from us a pro rata amount of any new securities that we may propose to issue and sell. The Investor Rights Agreement may be terminated (a) upon the mutual written agreement of all the parties, (b) upon our written notice, or the written notice of ROS or Royalty Opportunities if ROS and Royalty Opportunities’ ownership percentage of our then outstanding common stock is less than 10%, or (c) upon written notice of ROS and Royalty Opportunities.
Convertible Note Indenture
During the first quarter of 2018, all of the outstanding 6.00% convertible senior unsecured notes due 2021 were converted or exchanged into shares of our common stock, and the Indenture governing such notes was discharged. On January 17, 2018, Royalty Opportunities and ROS converted $1.6 million aggregate principal amount of 6.00% convertible senior unsecured promissory notes due in 2021, which were issued effective January 17, 2017, plus accrued and unpaid interest, into 189,645 shares of our common stock. On February 14, 2018, an additional $70.3 million aggregate principal amount of notes, plus accrued and unpaid interest, were exchanged for 10,401,309 newly-issued shares of our common stock.
Other Relationships with ROS and Royalty Opportunities
Matthew Rizzo and Michael Eggenberg, both of whom are employees of OrbiMed Advisors, and Jeffrey Peters, a Venture Partner with OrbiMed Advisors, were initially elected to our board of directors on February 13, 2018 and most recently reelected on October 27, 2020, and, accordingly, OrbiMed Advisors may have the ability to affect and influence control over us. As non-employee directors, from time to time, Messrs. Rizzo, Eggenberg and Peters may receive equity awards pursuant to our compensation arrangements for non-employee directors.
We or theThe selling stockholders and any of their respective donees,transferees, pledgees, transferees,donees, assignees or other successors-in-interest may, from time to time, offersell any or all of their respective shares of our common stock on any stock exchange, market or trading facility on which the shares are traded or in private transactions. See “Selling Stockholders” on page 14 of this prospectus. Such sales may be made on one or more exchanges or in the over-the-counter market or otherwise, at prices and sellunder terms then prevailing or at prices related to the securities being offered hereby inthen current market price, at fixed prices subject to change or at negotiated prices. The selling stockholders may use any one or more of the following ways from time to time:methods when selling shares:
| ● | an exchange or market distribution in accordance with the rules of the NYSE American; | |
| ● | privately negotiated transactions; | |
| ● | purchases by a broker-dealer as principal and resale by the broker-dealer for its account; | |
| ● | ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; | |
| ● | transactions in which a broker-dealer solicits purchasers on a best-efforts basis; | |
| ● | through one or more underwriters | |
| ● | ||
| ● | ||
| ● | through | |
| ● |
The selling stockholders also may sell shares under Rule 144 under the Securities Act, if available, or pursuant to another registration statement and prospectus, rather than under this prospectus.
We andThe selling stockholders also may transfer the shares of our common stock in other circumstances, in which case the transferees or other successors-in-interest will be the selling beneficial owners for purposes of this prospectus.
In effecting sales, broker-dealers or agents engaged by the selling stockholders may engagearrange for other broker-dealers to participate. Broker-dealers or agents may receive commissions, discounts or concessions from the selling stockholders in atamounts to be negotiated immediately prior to the market offerings into an existing trading market in accordancesale. In connection with Rule 415(a)(4) undersales of the Securities Act. In addition, weshares of our common stock offered hereby or otherwise, the selling stockholders may enter into derivativehedging transactions with third parties, orbroker-dealers, which may in turn engage in short sales of the shares of our common stock offered hereby in the course of hedging in positions they assume. The selling stockholders may also sell securities notshares of our common stock offered hereby short and deliver shares of our common stock covered by this prospectus to third parties in privately negotiated transactions. If the applicable prospectus supplement so indicates,close out short positions and to return borrowed shares in connection with those derivatives, the third partiessuch short sales. The selling stockholders may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions. If so, the third party may use securities pledged by us or borrowed from us or others to settle those sales or to close out any related open borrowings of shares, and may use securities received from us in settlement of those derivatives to close out any related open borrowings of shares. The third party in such sale transactions will be an underwriter and, if not identified in this prospectus, will be named in the applicable prospectus supplement (or a post-effective amendment). In addition, we may otherwisealso loan or pledge securitiesshares of our common stock offered hereby to a financial institution or other third partybroker-dealers that in turn may sell the securities short using this prospectus and an applicable prospectus supplement. Such financial institution or other third party may transfer its economic short position to investors in our securities or in connection with a concurrent offering of other securities.such shares.
TheIn offering the shares covered by this prospectus, supplement will state the manner and terms of the offering of the securities, including:
If we or any of the selling stockholders use underwriters or dealers in the sale, the securities will be acquired by the underwriters or dealers for their own account an may be resold from time to time in one or more transactions, including:
If underwriters are used in the sale of any securities, the securities may be offered either to the public through underwriting syndicates represented by managing underwriters or directly by underwriters. Generally, the underwriters’ obligations to purchase the securities will be subject to certain conditions precedent. If an offering is on a firm-commitment basis, the underwriters will be obligated to purchase all of the securities if they purchase any of the securities.
Underwriters may engage in stabilizing and syndicate covering transactions in accordance with Rule 104 of Regulation M under the Exchange Act. Rule 104 of Regulation M permits stabilizing bids to purchase the securities being offered as long as the stabilizing bids do not exceed a specified maximum. Underwriters may over-allot the offered securities in connection with the offering, thus creating a short position in their account. Syndicate covering transactions involve purchases of the offered securities by underwriters in the open market after the distribution has been completed in order to cover syndicate short positions. Stabilizing and syndicate covering transactions may cause the price of the offered securities to be higher than it would otherwise be in the absence of these transactions. These transactions, if commenced, may be discontinued at any time.
If indicated in an applicable prospectus supplement, we or the selling stockholders may sell securities through agents from time to time. The applicable prospectus supplement will name any agent involved in the offer or sale of the securities and any commissions that we or any selling stockholders pay to them. Generally, any agent will be acting on a best efforts basisbroker-dealers who execute sales for the period of its appointment. We or any selling stockholder may authorize underwriters, dealers or agents to solicit offers by certain purchasers to purchase securities at the public offering price set forth in the applicable prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery on a specified date in the future. The delayed delivery contracts will be subject only to those conditions set forth in the applicable prospectus supplement, and the applicable prospectus supplement will set forth any commissions we or any selling shareholders pay for solicitation of these delayed delivery contracts.
The selling stockholders may be deemed to be underwriters as defined in“underwriters” within the meaning of the Securities Act.Act in connection with such sales. In addition,such case, any profits realized by the agents, underwritersselling stockholders and other third parties described above that participate in the distributioncompensation of the securitiesany broker-dealer may be deemed to be underwriters. Agents, underwritersunderwriting discounts and other third parties described abovecommissions. In no event shall any broker-dealer receive fees, commissions and markups which, in the aggregate, exceed the amount permitted by applicable regulations.
In order to comply with the securities laws of certain states, if applicable, the shares must be sold in such jurisdictions only through registered or licensed brokers or dealers. In addition, in certain states, the shares may not be entitledsold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and satisfied.
The selling stockholders have informed us that none of them has any agreement or understanding, directly or indirectly, with any person to indemnification by us and bydistribute the shares of our common stock. If any selling shareholder against certain civil liabilities understockholder notifies us that an arrangement has been entered into with a broker-dealer for the Securities Act,sale of shares through a block trade, special offering or to contribution with respect to payments which the agentssecondary distribution or underwritersa purchase by a broker or dealer, we may be required to make in respect thereof. Agents, underwriters and such other third parties mayfile a prospectus supplement pursuant to the applicable rules promulgated under the Securities Act.
There can be customers of, engage in transactions with, or perform services for us orno assurance that any selling stockholder inwill sell any or all of the ordinary course of business.
We or the selling stockholders may sell the offered shares to one or more purchasers directly, in which case no underwriters or agents would be involved.
Our common stock is currently listed on the NYSE American under the symbol “XTNT.” The other securities that may be offered under this prospectus and the related prospectus supplement may or may not be listed on a national securities exchange. Shares of our common stock issued and sold by us under this prospectus will be listed on the NYSE American upon official notice of issuance. Any underwriters to whom shares of our common stock are sold by us for public offering and saleregistered pursuant to the registration statement, of which this prospectus is a part.
We have advised the selling stockholders that the anti-manipulation rules of Regulation M under the Exchange Act may make a marketapply to sales of shares of our common stock in the securities, but such underwriters will not be obligatedmarket and to do so and may discontinue any market making at any time without notice.
In compliance with the guidelinesactivities of the Financial Industry Regulatory Authority, or FINRA, the aggregate maximum discount, commission or agency fees or other items constituting underwriting compensation to be received by any FINRA member or independent broker-dealerselling stockholders and their affiliates. In addition, we will not exceed 8%make copies of any offering pursuant to this prospectus and any applicable prospectus supplement or pricing supplement, as the case may be.
Pursuantavailable to a registration rights agreement with the selling shareholders, we have agreed to indemnify in certain circumstancesstockholders for the selling shareholders against certain liabilities, including certain liabilities underpurpose of satisfying the prospectus delivery requirements of the Securities Act. The selling shareholders have agreed to indemnify us in certain circumstances against certain liabilities, including certain liabilities under the Securities Act. The selling shareholdersstockholders may indemnify any underwriter or broker-dealer that participates in transactions involving the sale of ordinarythe shares against certain liabilities, including liabilities arising under the Securities Act.
The specific terms of any lock-up provisions in respect of any given offering will be described in the applicable prospectus supplement.
The underwriters, dealers and agents may engage in transactions with us, or perform services for us, in the ordinary course of business for which they receive compensation.
There can be no assurance that we or We have agreed to indemnify the selling stockholders against certain losses, claims, damages and liabilities, including liabilities under the Securities Act.
We agreed to use our best efforts to keep the registration statement of which this prospectus is a part continuously effective, supplemented and amended as required by the Securities Act, in order to permit this prospectus to be usable by the selling stockholders for a period from the date the registration statement becomes effective to, and including, the date upon which no registrable securities are outstanding and constitute “restricted securities” (as defined in Rule 144 under the Securities Act). We will sellbear all expenses incurred in connection with the performance of our obligations under the Registration Rights Agreement and will reimburse the selling stockholders for the reasonable fees and disbursements of one firm or any ofcounsel to act as counsel for the securities offered byselling stockholders in connection with this prospectus.offering.
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Unless the applicable prospectus supplement indicates otherwise, theThe validity of the securities in respectshares of whichour common stock being offered by this prospectus is being delivered will behas been passed upon for us by Fox Rothschild LLP, Minneapolis, Minnesota. Additional legal matters may be passed upon for us or any underwriters, dealers or agents by counsel that we will name in the applicable prospectus supplement.
The financial statements for the years ended December 31, 20202022 and 20192021 incorporated by reference into this prospectus and registration statement have been audited by Plante & Moran, PLLC, an independent registered public accounting firm, as set forth in their report thereon, dated February 24, 2021,March 7, 2023, appearing in our most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on February 24, 2021,March 7, 2023, and incorporated by reference into this prospectus and registration statement, and such report is included in reliance upon the authority of such firm as experts in accounting and auditing.
INCORPORATION OF CERTAIN DOCUMENTSINFORMATION BY REFERENCE
The SEC allows us to “incorporate by reference” information from other documents that we file with it, which means that we can disclose important information to you by referring you to those documents. The information incorporated by reference is considered to be part of this prospectus. Information in this prospectus supersedes information incorporated by reference that we filed with the SEC prior to the date of this prospectus.
We incorporate by reference into this prospectus and the registration statement of which this prospectus is a part the information or documents listed below (File No. 001-34951) that we have filed with the SEC:
| ● | our Annual Report on Form 10-K for the year ended December 31, | |
| ● | Our Definitive Proxy Statement for our 2023 Annual Meeting of Stockholders, filed on June 8, 2023; | |
| ● | our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2023, filed on May 4, 2023; | |
| ● | our Current Reports on Form 8-K (other than portions thereof furnished under Item 2.02 or Item 7.01 of Form 8-K and exhibits accompanying such reports that are related to such items) filed on January 9, 2023, February | |
| ● | the description of our common stock contained in | |
| ● | all documents filed by us with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended, after the date of the initial filing of the registration statement of which this prospectus is a part and prior to the effectiveness of such registration statement; and | |
| ● | all documents filed by us with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act on or after the date of this prospectus and before we stop offering the securities under this prospectus. |
We are not, however, incorporating by reference any documents, or portions of documents, which are not deemed “filed” with the SEC.
You can obtain a copy of any or all of the documents incorporated by reference in this prospectus (other than an exhibit to a document unless that exhibit is specifically incorporated by reference into that document) from the SEC on its website at www.sec.gov. You may also obtain these documents from us, free of charge, by visiting our internet website www.xtantmedical.com or by writing to us or calling us at the following address and phone number:
Xtant Medical Holdings, Inc.
600 Cruiser Lane
Belgrade, Montana 59714
Attn: Corporate Secretary
(406) 388-0480
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WHERE YOU CAN FIND MORE INFORMATION
We have filed with the SEC a registration statement on Form S-3 under the Securities Act that registers the distribution of the securities offered under this prospectus. The registration statement, including the attached exhibits and schedules and the information incorporated by reference, contains additional relevant information about us and the securities. The rules and regulations of the SEC allow us to omit from this prospectus certain information included in the registration statement. In addition, we file annual, quarterly and current reports, proxy statements and other information with the SEC.
You may also obtain the documents that we file electronically on the SEC’s website at www.sec.gov, which contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC, or on our website at www.xtantmedical.com. Information contained on our website is not incorporated by reference herein and does not constitute part of this prospectus.
We have filed with the SEC a registration statement on Form S-3 under the Securities Act with respect to the securities offered by this prospectus. When used in this prospectus, the term “registration statement” includes amendments to the registration statement as well as the exhibits, schedules, financial statements and notes filed as part of the registration statement. This prospectus, which constitutes a part of the registration statement, does not contain all of the information in the registration statement. This prospectus omits information contained in the registration statement as permitted by the rules and regulations of the SEC. For further information with respect to us and our common stock and other securities that may be offered by this prospectus, reference is made to the registration statement. Statements herein concerning the contents of any contract or other document are not necessarily complete and in each instance reference is made to the copy of such contract or other document filed with the SEC as an exhibit to the registration statement, each such statement being qualified by and subject to such reference in all respects.
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITY
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling the registrant pursuant to the foregoing provisions, the registrant has been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable.
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XTANT MEDICAL HOLDINGS, INC.
PROSPECTUS
$150,000,000
Common Stock
Preferred Stock
Warrants
Units
Offered by Xtant Medical Holdings, Inc.
18,218,37420,000,000 Shares of our Common Stock
Offered by Selling Stockholders
, 20212023
We have not authorized any dealer, salesperson or other person to give any information or represent anything not contained in this prospectus. You must not rely on any unauthorized information. If anyone provides you with different or inconsistent information, you should not rely on it. This prospectus does not offer to sell any securities in any jurisdiction where it is unlawful. Neither the delivery of this prospectus, nor any sale made hereunder, shall create any implication that the information in this prospectus is correct after the date hereof.
PART II — INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table below sets forth all expenses, other than the estimated costsunderwriting discounts and expensescommissions, payable by the registrant in connection with the sale and distribution of the securitiesour common stock being registered hereby, other than underwriting discounts and commissions.registered. All of the amounts shown are estimates except the SEC registration fee. The expenses listed will be paid by Xtant.
| Amount to be paid | ||||
| SEC registration fee | $ | 19,684.33 | ||
| Accounting fees and expenses | * | |||
| Legal fees and expenses | * | |||
| Transfer agent fees and expenses | * | |||
| FINRA, blue sky fees and expenses | * | |||
| Printing expenses | * | |||
| Miscellaneous | * | |||
| Total | $ | * | ||
| Amount to be paid | ||||
| SEC registration fee | $ | 1,829 | ||
| Accounting fees and expenses | 10,000 | |||
| Legal fees and expenses | 10,000 | |||
| Miscellaneous | 2,000 | |||
| Total | $ | 23,829 | ||
Item 15. Indemnification of Directors and Officers
General Corporation Law of the State of Delaware
Section 145(a) of the DGCL provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the person’s conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that the person’s conduct was unlawful.
Section 145(b) of the DGCL states that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys’ fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which the person shall have been adjudged to be liable to the corporation unless and only to the extent that the Delaware Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for such expenses as the Delaware Court of Chancery or such other court shall deem proper.
Section 145(c) of the DGCL provides that to the extent that a present or former director or officer of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in subsections (a) and (b) of Section 145, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith.
Section 145(d) of the DGCL states that any indemnification under subsections (a) and (b) of Section 145 (unless ordered by a court) shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the present or former director, officer, employee or agent is proper in the circumstances because the person has met the applicable standard of conduct set forth in subsections (a) and (b) of Section 145. Such determination shall be made with respect to a person who is a director or officer at the time of such determination (1) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, (2) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, (3) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion or (4) by the stockholders.
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Section 145(f) of the DGCL states that the indemnification and advancement of expenses provided by, or granted pursuant to, the other subsections of Section 145 shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office.
Section 145(g) of the DGCL provides that a corporation shall have the power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against any liability asserted against such person and incurred by such person in any such capacity or arising out of such person’s status as such, whether or not the corporation would have the power to indemnify such person against such liability under the provisions of Section 145.
Section 145(j) of the DGCL states that the indemnification and advancement of expenses provided by, or granted pursuant to, Section 145 shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person.
Charter
The Company has adopted provisions in its Charter that limit director liability to the maximum extent permitted under the DGCL.
Bylaws
The Company’s Bylaws provide for the indemnification of directors and officers to the fullest extent permitted by applicable law.
Indemnification Agreements
We have entered into agreements with our directors and executive officers that require us to indemnify them against certain liabilities that may arise by reason of their status or service as directors or executive officers to the fullest extent not prohibited by Delaware law.
Insurance Policies
We have purchased insurance policies that purport to insure our directors and officers against certain liabilities incurred by them in the discharge of their functions as directors and officers.
The foregoing description of our Charter, Bylaws, and Section 145 of the DGCL is only a summary and is qualified in its entirety by the full text of each of the foregoing.
We have been advised that it is the position of the SECSecurities and Exchange Commission that insofar as the foregoing provisions may be invoked to disclaim liability for damages arising under the Securities Act, that such provisions are against public policy as expressed in the Securities Act and are therefore unenforceable.
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Item 16.Exhibits and Financial Statement Schedules |
| (a) | Exhibits |
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| * | Filed herewith |
Schedules have been omitted because the information required to be set forth therein is not applicable or is shown in the financial statements or notes thereto.
Item 17. Undertakings
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
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(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Filing Fee Tables” or “Calculation of Registration Fee” table in the effective registration statement; and
(iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement;
provided, however, that paragraphs (a)(1)(i), (ii) and (iii) doshall not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the SEC by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.
(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(4) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities:
The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;
(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;
(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and
(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
(b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
(d) That, for purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b) (1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.
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(e) That, for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Belgrade, State of Montana, on May 11, 2021.July 7, 2023.
| XTANT MEDICAL HOLDINGS, INC. | ||
| By: | /s/ Sean E. Browne | |
| Name: | Sean E. Browne | |
| Title: | President and Chief Executive Officer | |
We, the undersigned officers and directors of Xtant Medical Holdings, Inc., a Delaware corporation, hereby constitute and appoint Sean E. Browne and Greg Jensen,Scott Neils, and each of them individually, as the true and lawful agent and attorney-in-fact of the undersigned with full power and authority in said agent and attorney-in-fact to sign for the undersigned and in their respective names as an officer/director of the Company, any and all amendments (including post-effective amendments) to this registration statement on Form S-1S-3 (or any other registration statement for the same offering that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act) and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, and with full power of substitution, hereby ratifying and confirming all that said attorney-in-fact, or his substitute or substitutes, may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities and on the dates indicated.
| Signature | Capacity | Date | ||
| /s/ Sean E. Browne | President and Chief Executive Officer and Director | |||
| Sean E. Browne | (Principal Executive Officer) | |||
| /s/ | ||||
(Principal Financial Officer and Principal Accounting Officer) | ||||
| /s/ Stavros Vizirgianakis | Chair of the Board of Directors | July 7, 2023 | ||
| Stavros Vizirgianakis | ||||
| /s/ John K. Bakewell | Director | |||
| John K. Bakewell | ||||
| /s/ | Director | |||
| /s/ Robert McNamara | Director | |||
| Robert McNamara | ||||
| /s/ | Director | July 7, 2023 | ||