x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Florida
|
|
26-2792552
|
(State or other jurisdiction of incorporation)
|
|
(I.R.S. Employer Identification Number)
|
1775 West Oak Commons Ct NE
Marietta, GA
|
|
30062
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Large accelerated filer
¨
|
Accelerated filer
x
|
Non-accelerated filer
¨
(Do not check if a smaller reporting company)
|
Smaller reporting company
¨
|
Part I FINANCIAL INFORMATION
|
|
|
|
|
|
Item 1
|
Condensed Consolidated Financial Statements
|
|
|
|
|
|
Condensed Consolidated Balance Sheets (unaudited) June 30, 2013 and December 31, 2012
|
|
|
Condensed Consolidated Statements of Operations (unaudited) Three and Six Months Ended June 30, 2013 and 2012
|
|
|
Condensed Consolidated Statement of Stockholders’ Equity (unaudited) Six Months Ended June 30, 2013
|
|
|
Condensed Consolidated Statements of Cash Flows (unaudited) Six Months Ended June 30, 2013 and 2012
|
|
|
Notes to the Unaudited Condensed Consolidated Financial Statements Three and Six Months Ended June 30, 2013 and 2012
|
|
|
|
|
Item 2
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
|
|
|
Item 3
|
Quantitative and Qualitative Disclosures About Market Risk
|
|
|
|
|
Item 4
|
Controls and Procedures
|
|
|
|
|
Part II OTHER INFORMATION
|
|
|
|
|
|
Item 1
|
Legal Proceedings
|
|
|
|
|
Item 1A
|
Risk Factors
|
|
|
|
|
Item 2
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
|
|
|
|
Item 3
|
Defaults upon Senior Securities
|
|
|
|
|
Item 4
|
Mine Safety Disclosures
|
|
|
|
|
Item 5
|
Other Information
|
|
|
|
|
Item 6
|
Exhibits
|
|
|
|
|
Signatures
|
|
|
June 30,
2013
(unaudited)
|
|
December 31, 2012
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
4,193,583
|
|
|
$
|
6,754,485
|
|
Accounts receivable, net
|
11,761,874
|
|
|
7,653,561
|
|
||
Inventory, net
|
4,220,284
|
|
|
3,022,784
|
|
||
Prepaid expenses and other current assets
|
1,351,948
|
|
|
657,961
|
|
||
|
|
|
|
||||
Total current assets
|
21,527,689
|
|
|
18,088,791
|
|
||
|
|
|
|
||||
Property and equipment, net of accumulated depreciation of $2,517,774 and $2,279,840, respectively
|
2,990,746
|
|
|
1,071,625
|
|
||
Goodwill
|
4,040,443
|
|
|
4,040,443
|
|
||
Intangible assets, net of accumulated amortization of $5,378,990 and $4,848,756, respectively
|
11,724,210
|
|
|
11,911,749
|
|
||
Deposits and other long term assets
|
—
|
|
|
70,000
|
|
||
|
|
|
|
||||
Total assets
|
$
|
40,283,088
|
|
|
$
|
35,182,608
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
||||
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
1,837,711
|
|
|
$
|
1,251,684
|
|
Accrued compensation
|
2,974,709
|
|
|
2,753,237
|
|
||
Accrued expenses
|
1,075,916
|
|
|
990,697
|
|
||
Other current liabilities
|
252,343
|
|
|
75,154
|
|
||
Total current liabilities
|
6,140,679
|
|
|
5,070,772
|
|
||
|
|
|
|
||||
Earn-out liability payable in MiMedx common stock
|
—
|
|
|
5,792,330
|
|
||
Convertible Senior Secured Promissory Notes, net
|
—
|
|
|
4,012,442
|
|
||
Other liabilities
|
1,250,866
|
|
|
299,762
|
|
||
Total liabilities
|
7,391,545
|
|
|
15,175,306
|
|
||
|
|
|
|
||||
Commitments and contingencies (Note 12)
|
—
|
|
|
—
|
|
||
|
|
|
|
||||
Stockholders' equity:
|
|
|
|
||||
Preferred stock; $.001 par value; 5,000,000 shares authorized and 0 shares issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock; $.001 par value; 130,000,000 shares authorized; 96,356,451 issued and 96,306,451 outstanding for 2013 and 88,423,169 issued and 88,373,169 outstanding for 2012
|
96,356
|
|
|
88,423
|
|
||
Additional paid-in capital
|
104,881,706
|
|
|
89,627,601
|
|
||
Treasury stock (50,000 shares at cost)
|
(25,000
|
)
|
|
(25,000
|
)
|
||
Accumulated deficit
|
(72,061,519
|
)
|
|
(69,683,722
|
)
|
||
Total stockholders' equity
|
32,891,543
|
|
|
20,007,302
|
|
||
|
|
|
|
||||
Total liabilities and stockholders' equity
|
$
|
40,283,088
|
|
|
$
|
35,182,608
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Net sales
|
$
|
13,514,743
|
|
|
$
|
4,884,256
|
|
|
$
|
25,071,235
|
|
|
$
|
8,590,064
|
|
Cost of sales
|
2,198,482
|
|
|
1,114,926
|
|
|
4,103,502
|
|
|
2,073,781
|
|
||||
Gross margin
|
11,316,261
|
|
|
3,769,330
|
|
|
20,967,733
|
|
|
6,516,283
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Research and development expenses
|
924,468
|
|
|
503,086
|
|
|
2,171,222
|
|
|
910,158
|
|
||||
Selling, general and administrative expenses
|
10,868,372
|
|
|
3,049,783
|
|
|
19,237,384
|
|
|
5,687,052
|
|
||||
Amortization of intangible assets
|
267,638
|
|
|
333,977
|
|
|
530,234
|
|
|
667,954
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating income (loss)
|
(744,217
|
)
|
|
(117,516
|
)
|
|
(971,107
|
)
|
|
(748,881
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Other income (expense), net
|
|
|
|
|
|
|
|
||||||||
Amortization of debt discount
|
—
|
|
|
(472,749
|
)
|
|
(1,328,439
|
)
|
|
(783,226
|
)
|
||||
Interest expense, net
|
(13,172
|
)
|
|
(153,804
|
)
|
|
(27,976
|
)
|
|
(305,614
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Income (loss) before income tax provision
|
(757,389
|
)
|
|
(744,069
|
)
|
|
(2,327,522
|
)
|
|
(1,837,721
|
)
|
||||
Income tax provision
|
—
|
|
|
—
|
|
|
(50,275
|
)
|
|
—
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Net Income (loss)
|
$
|
(757,389
|
)
|
|
$
|
(744,069
|
)
|
|
$
|
(2,377,797
|
)
|
|
$
|
(1,837,721
|
)
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) per common share - basic and diluted
|
$
|
(0.01
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.02
|
)
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding - basic and diluted
|
95,988,100
|
|
|
79,952,542
|
|
|
94,599,406
|
|
|
77,416,073
|
|
|
Convertible
Preferred Stock Series A
|
|
|
|
|
|
Additional Paid-in Capital
|
|
|
|
|
|
|
||||||||||||||||
|
|
Common Stock
|
|
|
Treasury Stock
|
|
Accumulated Deficit
|
|
|
||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|
|
Total
|
|||||||||||||||||
Balance December 31, 2012
|
—
|
|
|
$
|
—
|
|
|
88,423,169
|
|
|
$
|
88,423
|
|
|
$
|
89,627,601
|
|
|
$
|
(25,000
|
)
|
|
$
|
(69,683,722
|
)
|
|
$
|
20,007,302
|
|
Share-based compensation
expense
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,487,239
|
|
|
—
|
|
|
—
|
|
|
2,487,239
|
|
||||||
Exercise of stock options
|
—
|
|
|
—
|
|
|
489,197
|
|
|
489
|
|
|
542,352
|
|
|
—
|
|
|
—
|
|
|
542,841
|
|
||||||
Exercise of warrants
|
—
|
|
|
—
|
|
|
997,166
|
|
|
997
|
|
|
1,166,627
|
|
|
—
|
|
|
—
|
|
|
1,167,624
|
|
||||||
Common stock issued for 5% convertible note
|
—
|
|
|
—
|
|
|
5,272,004
|
|
|
5,272
|
|
|
5,266,732
|
|
|
—
|
|
|
—
|
|
|
5,272,004
|
|
||||||
Common stock issued for earn-out liability
|
—
|
|
|
—
|
|
|
1,174,915
|
|
|
1,175
|
|
|
5,791,155
|
|
|
—
|
|
|
—
|
|
|
5,792,330
|
|
||||||
Net income (loss )
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,377,797
|
)
|
|
(2,377,797
|
)
|
||||||
Balance June 30, 2013
|
—
|
|
|
$
|
—
|
|
|
96,356,451
|
|
|
$
|
96,356
|
|
|
$
|
104,881,706
|
|
|
$
|
(25,000
|
)
|
|
$
|
(72,061,519
|
)
|
|
$
|
32,891,543
|
|
|
Six Months Ended
June 30,
|
||||||
|
2013
|
|
2012
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net income (loss)
|
$
|
(2,377,797
|
)
|
|
$
|
(1,837,721
|
)
|
Adjustments to reconcile net income (loss) to net cash from operating activities:
|
|
|
|
||||
Depreciation
|
237,934
|
|
|
231,491
|
|
||
Amortization of intangible assets
|
530,234
|
|
|
667,954
|
|
||
Amortization of debt discount and deferred financing costs
|
1,328,439
|
|
|
783,226
|
|
||
Share-based compensation
|
2,487,239
|
|
|
1,086,200
|
|
||
Increase (decrease) in cash resulting from changes in:
|
|
|
|
||||
Accounts receivable
|
(4,108,313
|
)
|
|
(2,054,414
|
)
|
||
Inventory
|
(1,197,500
|
)
|
|
(249,337
|
)
|
||
Prepaid expenses
|
(721,223
|
)
|
|
(127,559
|
)
|
||
Other assets
|
70,000
|
|
|
—
|
|
||
Accounts payable
|
586,027
|
|
|
(372,938
|
)
|
||
Accrued compensation
|
221,472
|
|
|
119,241
|
|
||
Accrued expenses
|
85,219
|
|
|
(84,939
|
)
|
||
Accrued interest
|
(41,641
|
)
|
|
232,107
|
|
||
Other liabilities
|
46,362
|
|
|
7,878
|
|
||
Net cash flows from operating activities
|
(2,853,548
|
)
|
|
(1,598,811
|
)
|
||
|
|
|
|
||||
Cash flows from investing activities:
|
|
|
|
||||
Purchases of equipment
|
(1,052,930
|
)
|
|
(238,498
|
)
|
||
Patent application costs
|
(342,695
|
)
|
|
—
|
|
||
Net cash flows from investing activities
|
(1,395,625
|
)
|
|
(238,498
|
)
|
||
|
|
|
|
||||
Cash flows from financing activities:
|
|
|
|
||||
Proceeds from exercise of warrants
|
1,167,624
|
|
|
323,638
|
|
||
Proceeds from exercise of stock options
|
542,841
|
|
|
315,295
|
|
||
Repayment of convertible debt related to acquisition
|
—
|
|
|
(250,000
|
)
|
||
Principal payments of equipment leases
|
(22,194
|
)
|
|
(9,256
|
)
|
||
Net cash flows from financing activities
|
1,688,271
|
|
|
379,677
|
|
||
|
|
|
|
||||
Net change in cash
|
(2,560,902
|
)
|
|
(1,457,632
|
)
|
||
|
|
|
|
||||
Cash and cash equivalents, beginning of period
|
6,754,485
|
|
|
4,112,326
|
|
||
Cash and cash equivalents, end of period
|
$
|
4,193,583
|
|
|
$
|
2,654,694
|
|
1.
|
Basis of Presentation
|
2.
|
Significant Accounting Policies
|
3.
|
Liquidity and Management’s Plans
|
4.
|
Inventories
|
|
June 30, 2013
|
|
December 31, 2012
|
||||
Raw materials
|
$
|
270,441
|
|
|
$
|
233,747
|
|
Work in process
|
2,765,802
|
|
|
1,598,537
|
|
||
Finished goods
|
1,425,996
|
|
|
1,349,121
|
|
||
|
4,462,239
|
|
|
3,181,405
|
|
||
Reserve for obsolescence
|
(241,955
|
)
|
|
(158,621
|
)
|
||
Inventory, net
|
$
|
4,220,284
|
|
|
$
|
3,022,784
|
|
5.
|
Property and Equipment
|
|
|
June 30, 2013
|
|
December 31, 2012
|
||||
Leasehold improvements
|
|
$
|
2,147,775
|
|
|
$
|
1,022,230
|
|
Lab and clean room equipment
|
|
1,901,219
|
|
|
1,887,645
|
|
||
Furniture and office equipment
|
|
903,433
|
|
|
431,563
|
|
||
Construction in progress
|
|
556,093
|
|
|
10,027
|
|
||
|
|
5,508,520
|
|
|
3,351,465
|
|
||
Less accumulated depreciation
|
|
(2,517,774
|
)
|
|
(2,279,840
|
)
|
||
|
|
$
|
2,990,746
|
|
|
$
|
1,071,625
|
|
6.
|
Intangible Assets and Royalty Agreement
|
|
June 30, 2013
|
December 31, 2012
|
||||||||||||||||||||
|
Weighted
Average
Amortization
Lives
|
Gross
Carrying
Value
|
Accumulated
Amortization
|
Net
Carrying
Value
|
Gross
Carrying
Value
|
Impairment
Adjustment
|
Accumulated
Amortization
|
Net
Carrying
Value
|
||||||||||||||
Intangible assets subject to amortization:
|
|
|
|
|
|
|||||||||||||||||
License-Shriners Hsp for Children & USF Research (a)
|
10 years
|
$
|
996,000
|
|
$
|
(637,433
|
)
|
$
|
358,567
|
|
$
|
996,000
|
|
$
|
—
|
|
$
|
(587,633
|
)
|
$
|
408,367
|
|
License - SaluMedica LLC Spine Repair (b)
|
10 years
|
1,547,324
|
|
(1,547,324
|
)
|
—
|
|
2,399,000
|
|
(851,676
|
)
|
(1,547,324
|
)
|
—
|
|
|||||||
License - Polyvinyl Alcohol Cryogel (c)
|
10 years
|
1,720,181
|
|
(1,287,824
|
)
|
432,357
|
|
2,667,000
|
|
(946,819
|
)
|
(1,223,561
|
)
|
496,620
|
|
|||||||
Customer Relationships (d)
|
14 years
|
3,520,000
|
|
(628,572
|
)
|
2,891,428
|
|
3,520,000
|
|
—
|
|
(502,857
|
)
|
3,017,143
|
|
|||||||
Supplier Relationships (d)
|
14 years
|
241,000
|
|
(43,036
|
)
|
197,964
|
|
241,000
|
|
—
|
|
(34,428
|
)
|
206,572
|
|
|||||||
Patents & Know-How (d)
|
14 years
|
5,530,000
|
|
(987,500
|
)
|
4,542,500
|
|
5,530,000
|
|
—
|
|
(790,000
|
)
|
4,740,000
|
|
|||||||
Micronized Processing Know-How (d)
|
14 years
|
2,160,000
|
|
(231,428
|
)
|
1,928,572
|
|
2,160,000
|
|
—
|
|
(154,286
|
)
|
2,005,714
|
|
|||||||
Licenses/Permits (d)
|
3 years
|
13,000
|
|
(10,833
|
)
|
2,167
|
|
13,000
|
|
—
|
|
(8,667
|
)
|
4,333
|
|
|||||||
Patent Application Cost ( e )
|
17 years
|
342,695
|
|
(5,040
|
)
|
337,655
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||||
|
|
16,070,200
|
|
(5,378,990
|
)
|
10,691,210
|
|
17,526,000
|
|
(1,798,495
|
)
|
(4,848,756
|
)
|
10,878,749
|
|
|||||||
Intangible assets not subject to amortization:
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Trade Names/Trademarks (d)
|
indefinite
|
1,008,000
|
|
—
|
|
1,008,000
|
|
1,008,000
|
|
—
|
|
—
|
|
1,008,000
|
|
|||||||
In-process Research & Development-Other (d)
|
indefinite
|
25,000
|
|
—
|
|
25,000
|
|
25,000
|
|
—
|
|
—
|
|
25,000
|
|
|||||||
|
|
$
|
17,103,200
|
|
$
|
(5,378,990
|
)
|
$
|
11,724,210
|
|
$
|
18,559,000
|
|
$
|
(1,798,495
|
)
|
$
|
(4,848,756
|
)
|
$
|
11,911,749
|
|
(a)
|
On January 29, 2007, the Company acquired a license from Shriners Hospitals for Children and University of South Florida Research Foundation, Inc. The acquisition price of this license was a one-time fee of
$100,000
and
1,120,000
|
(b)
|
License from SaluMedica, LLC (SaluMedica) for the use of certain developed technologies related to spine repair. This license was acquired through the acquisition of SpineMedica Corp. In September 2012, the cost of this license was deemed to be impaired and reduced to its fair value.
|
(c)
|
On March 31, 2008, the Company entered into a license agreement for the use of certain developed technologies related to surgical sheets made of polyvinyl alcohol hydrogel. The acquisition price of the asset was
400,000
shares of common stock valued at
$2,596,000
(based upon the closing price of the common stock on the transaction date). The agreement also provides for the issuance of an additional
600,000
shares upon the Company meeting certain milestones related to future sales. On December 31, 2009, the Company completed the sale of its first commercial product and met its first milestone under this agreement. As a result, the Company issued an additional
100,000
shares of common stock to the licensor valued at
$71,000
. In September 2012, the cost of the license was deemed to be impaired and reduced to its fair value. At June 30, 2013 and December 31, 2012, there are no additional amounts accrued for this obligation due to its contingent nature.
|
(d)
|
On January 5, 2011, the Company acquired Surgical Biologics, LLC. As a result, the Company recorded intangible assets for customer and supplier relationships, patents and know-how, licenses/permits, trade names and trademarks and in-process research and development.
|
|
Estimated Amortization Expense
|
||
Year ending December 31,
|
|||
2013 (a)
|
$
|
535,266
|
|
2014
|
1,066,205
|
|
|
2015
|
1,044,151
|
|
|
2016
|
997,156
|
|
|
2017
|
906,960
|
|
|
Thereafter
|
6,141,472
|
|
|
|
$
|
10,691,210
|
|
(a)
|
Estimated amortization expense for the year ending December 31, 2013 includes only amortization to be recorded after June 30, 2013.
|
7.
|
Long-Term Debt
|
|
June 30,
2013
|
|
December 31,
2012
|
||||
$5M Convertible Senior Secured Promissory Notes including interest at 5% per annum payable quarterly through December 31, 2013, and an additional one time 5% interest charge payable on January 15, 2013 if not repaid by December 31, 2012, collateralized by a first priority lien shared equally with holder of the Convertible Line of Credit with Related Party in all of the patents and intellectual property owned by the Company subordinated to the Convertible Debt related to acquisition for Surgical Biologics intellectual property until repaid. (a)
|
$
|
—
|
|
|
$
|
5,313,645
|
|
Total debt
|
—
|
|
|
5,313,645
|
|
||
Less unamortized debt discount
|
—
|
|
|
(1,301,203
|
)
|
||
Less current portion
|
—
|
|
|
—
|
|
||
Long-term portion
|
$
|
—
|
|
|
$
|
4,012,442
|
|
8.
|
Net Income (loss) Per Share
|
|
Three months ended
June 30,
|
|
Six months ended
June 30,
|
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Net income (loss)
|
$
|
(757,389
|
)
|
|
$
|
(744,069
|
)
|
|
$
|
(2,377,797
|
)
|
|
$
|
(1,837,721
|
)
|
Denominator for basic earnings per share - weighted average shares
|
95,988,100
|
|
|
79,952,542
|
|
|
94,599,406
|
|
|
77,416,073
|
|
||||
Effect of dilutive securities: Stock options and warrants outstanding and convertible debt (a)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Denominator for diluted earnings per share - weighted average shares adjusted for dilutive securities
|
95,988,100
|
|
|
79,952,542
|
|
|
94,599,406
|
|
|
77,416,073
|
|
||||
Income (loss) per common share - basic and diluted
|
$
|
(0.01
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
(0.02
|
)
|
|
Six months ended June 30,
|
||||
|
2013
|
|
2012
|
||
Outstanding Stock Options
|
15,917,272
|
|
|
12,794,250
|
|
Outstanding Warrants
|
2,132,002
|
|
|
7,763,817
|
|
Convertible Debt, promissory notes
|
—
|
|
|
5,186,933
|
|
Convertible Line of Credit with Related Party
|
—
|
|
|
1,375,137
|
|
Convertible Debt, Acquisition
|
—
|
|
|
1,069,808
|
|
|
18,049,274
|
|
|
28,189,945
|
|
9.
|
Equity
|
|
Number of
Shares
|
|
Weighted-
Average
Exercise
Price
|
|
Weighted-
Average
Remaining
Contractual
Term
(in years)
|
|
Aggregate
Intrinsic
Value
|
|||||
Outstanding at January 1, 2013
|
13,614,135
|
|
|
$
|
1.42
|
|
|
|
|
|
||
Granted
|
3,024,500
|
|
|
5.09
|
|
|
|
|
|
|||
Exercised
|
(489,197
|
)
|
|
1.11
|
|
|
|
|
|
|||
Unvested options forfeited
|
(179,167
|
)
|
|
3.82
|
|
|
|
|
|
|||
Vested options expired
|
(52,999
|
)
|
|
1.11
|
|
|
|
|
|
|||
Outstanding at June 30, 2013
|
15,917,272
|
|
|
2.10
|
|
|
7.9
|
|
$
|
78,906,155
|
|
|
Vested at June 30, 2013
|
7,044,063
|
|
|
1.12
|
|
|
6.5
|
|
$
|
41,809,325
|
|
|
Vested or expected to vest at June 30, 2013 (a)
|
15,576,624
|
|
|
$
|
2.10
|
|
|
7.9
|
|
$
|
77,742,045
|
|
(a)
|
Includes forfeiture adjusted unvested shares.
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||
Range of Exercise Prices
|
Number outstanding
|
|
Weighted-
Average
Remaining
Contractual
Term
(in years)
|
|
Weighted-
Average
Exercise
Price
|
|
Number Exercisable
|
|
Weighted-
Average
Exercise Price
|
||||||
$0.50 - $0.76
|
2,169,500
|
|
|
4.8
|
|
$
|
0.67
|
|
|
2,169,500
|
|
|
$
|
0.67
|
|
$0.87 - $1.35
|
6,814,572
|
|
|
8.1
|
|
1.19
|
|
|
3,356,198
|
|
|
1.18
|
|
||
$1.40 - $2.29
|
1,816,700
|
|
|
6.4
|
|
1.63
|
|
|
1,518,365
|
|
|
1.65
|
|
||
$2.33 - $3.75
|
2,164,500
|
|
|
9.2
|
|
2.75
|
|
|
—
|
|
|
—
|
|
||
$3.95 - $6.53
|
2,804,000
|
|
|
9.7
|
|
5.00
|
|
|
—
|
|
|
—
|
|
||
$6.60 - $6.75
|
148,000
|
|
|
9.9
|
|
6.61
|
|
|
—
|
|
|
—
|
|
||
|
15,917,272
|
|
|
7.9
|
|
$
|
2.10
|
|
|
7,044,063
|
|
|
$
|
1.12
|
|
|
Six months ended June 30,
|
||||
|
2013
|
|
2012
|
||
Expected volatility
|
62.15-64.27%
|
|
|
57.3 - 57.6%
|
|
Expected life (in years)
|
5.5 - 6
|
|
|
6
|
|
Expected dividend yield
|
—
|
|
|
—
|
|
Risk-free interest rate
|
0.85-1.13%
|
|
|
1.48-2.24%
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Cost of products sold
|
$
|
72,669
|
|
|
$
|
29,479
|
|
|
$
|
122,831
|
|
|
$
|
53,489
|
|
Research and development
|
122,789
|
|
|
75,610
|
|
|
198,767
|
|
|
147,130
|
|
||||
Selling, general and administrative
|
1,306,989
|
|
|
480,126
|
|
|
2,165,641
|
|
|
885,581
|
|
||||
|
$
|
1,502,447
|
|
|
$
|
585,215
|
|
|
$
|
2,487,239
|
|
|
$
|
1,086,200
|
|
|
Number of
Warrants
|
|
Weighted-
Average
Exercise
Price per
Warrant
|
|||
Warrants outstanding at January 1, 2013
|
3,129,168
|
|
|
$
|
1.04
|
|
Warrants exercised:
|
|
|
|
|||
Contingent warrants related to private placement of common stock
|
(62,500
|
)
|
|
0.01
|
|
|
Callable warrants
|
(266,666
|
)
|
|
1.50
|
|
|
Other
|
(668,000
|
)
|
|
1.15
|
|
|
Warrants outstanding at June 30, 2013
|
2,132,002
|
|
|
$
|
0.98
|
|
•
|
notice given by the holder accompanied by payment of an amount equal to the warrant exercise price multiplied by the number of warrant shares being purchased; or
|
•
|
election by the holder to exchange the warrant (or portion thereof) for that number of shares equal to the product of (a) the number of shares issuable upon exercise of the warrant (or portion) and (b) a fraction, (x) the numerator of which is the market price of the shares at the time of exercise minus the warrant exercise price per share at the time of exercise and (y) the denominator of which is the market price per share at the time of exercise.
|
10.
|
Income taxes
|
11.
|
Supplemental disclosure of cash flow and non-cash investing and financing activities:
|
|
Six Months Ended
June 30,
|
||||||
|
2013
|
|
2012
|
||||
Cash paid for interest
|
$
|
17,662
|
|
|
$
|
5,435
|
|
Income taxes paid
|
50,275
|
|
|
—
|
|
||
Purchases of property, plant and equipment financed capital leases
|
107,259
|
|
|
72,302
|
|
||
Stock issuance of 167,086 shares in lieu of Director's fees
|
—
|
|
|
184,653
|
|
||
Deferred financing costs
|
27,236
|
|
|
9,537
|
|
||
Beneficial conversion related to line of credit with related party
|
—
|
|
|
514,456
|
|
||
Stock issuance in connection with Earn-Out Liability of 1,174, 915 shares for 2013 and
|
|
|
|
||||
2,632,576 shares for 2012
|
5,792,330
|
|
|
3,185,223
|
|
||
Stock issuance of 5,272,004 shares in exchange for convertible debt
|
5,272,004
|
|
|
—
|
|
||
Company issued shares of 167,183 for cashless exercise
|
—
|
|
|
167
|
|
||
Tenant improvement incentive, net of amortization of $28,895
|
967,971
|
|
|
—
|
|
12.
|
Contractual Commitments and Contingencies
|
12-month period ended June 30
|
|||
2014
|
$
|
837,406
|
|
2015
|
1,122,322
|
|
|
2016
|
1,319,454
|
|
|
2017
|
1,359,514
|
|
|
Thereafter
|
2,237,443
|
|
|
|
$
|
6,876,139
|
|
13.
|
Subsequent Events
|
|
Three Months Ended June 30,
|
||||||||||||||||||||||||||||||
|
2013
|
|
2012
|
||||||||||||||||||||||||||||
|
Debt
Discount
|
|
Accrued Interest
|
|
Interest Expense
|
|
Total
|
|
Debt Discount
|
|
Accrued Interest
|
|
Interest Expense
|
|
Total
|
||||||||||||||||
Convertible line of credit with related party
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
150,880
|
|
|
$
|
16,205
|
|
|
—
|
|
|
$
|
167,085
|
|
|
Converted debt related to acquisition
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
86,335
|
|
|
9,973
|
|
|
—
|
|
|
96,308
|
|
||||||||
Convertible Senior secured promissory notes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
230,744
|
|
|
124,657
|
|
|
—
|
|
|
355,401
|
|
||||||||
Deferred financing related to senior secured promissory notes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,790
|
|
|
—
|
|
|
—
|
|
|
4,790
|
|
||||||||
Other
|
—
|
|
|
—
|
|
|
13,172
|
|
|
13,172
|
|
|
—
|
|
|
—
|
|
|
2,969
|
|
|
2,969
|
|
||||||||
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
13,172
|
|
|
$
|
13,172
|
|
|
$
|
472,749
|
|
|
$
|
150,835
|
|
|
$
|
2,969
|
|
|
$
|
626,553
|
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||||||||
|
2013
|
|
2012
|
||||||||||||||||||||||||||||
|
Debt
Discount
|
|
Accrued Interest
|
|
Interest Expense
|
|
Total
|
|
Debt Discount
|
|
Accrued Interest
|
|
Interest Expense
|
|
Total
|
||||||||||||||||
Convertible line of credit with related party
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
162,303
|
|
|
$
|
32,411
|
|
|
—
|
|
|
$
|
194,714
|
|
||
Converted debt related to acquisition
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
166,688
|
|
|
20,493
|
|
|
—
|
|
|
187,181
|
|
||||||||
Convertible Senior secured promissory notes
|
1,328,439
|
|
|
11,571
|
|
|
—
|
|
|
1,340,010
|
|
|
444,698
|
|
|
247,945
|
|
|
—
|
|
|
692,643
|
|
||||||||
Deferred financing related to senior secured promissory notes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,537
|
|
|
—
|
|
|
—
|
|
|
9,537
|
|
||||||||
Other
|
—
|
|
|
—
|
|
|
16,405
|
|
|
16,405
|
|
|
—
|
|
|
—
|
|
|
4,765
|
|
|
4,765
|
|
||||||||
|
$
|
1,328,439
|
|
|
$
|
11,571
|
|
|
$
|
16,405
|
|
|
$
|
1,356,415
|
|
|
$
|
783,226
|
|
|
$
|
300,849
|
|
|
$
|
4,765
|
|
|
$
|
1,088,840
|
|
|
|
|
Less than
|
|
|
|
|
|
More than
|
||||||
Contractual Obligations
|
TOTAL
|
|
1 year
|
|
1-3 years
|
|
3-5 years
|
|
5 years
|
||||||
Capital lease obligations
|
$
|
153,600
|
|
|
31,817
|
|
|
71,324
|
|
|
50,459
|
|
|
—
|
|
Operating lease obligations
|
$
|
6,876,139
|
|
|
837,406
|
|
|
2,441,776
|
|
|
2,759,887
|
|
|
837,070
|
|
|
$
|
7,029,739
|
|
|
869,223
|
|
|
2,513,100
|
|
|
2,810,346
|
|
|
837,070
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
||||||||||||
|
2013
|
|
2012
|
|
2013
|
|
2012
|
||||||||
Net Loss (Per GAAP)
|
$
|
(757,389
|
)
|
|
$
|
(744,069
|
)
|
|
$
|
(2,377,797
|
)
|
|
$
|
(1,837,721
|
)
|
|
|
|
|
|
|
|
|
||||||||
Add back:
|
|
|
|
|
|
|
|
|
|
||||||
Income Taxes
|
—
|
|
|
—
|
|
|
50,275
|
|
|
—
|
|
||||
Financing expense associated with beneficial conversion of note payable issued in conjunction with acquisition
|
—
|
|
|
86,335
|
|
|
—
|
|
|
166,688
|
|
||||
Financing expense associated with beneficial conversion of Line of Credit with Related Party
|
—
|
|
|
150,880
|
|
|
—
|
|
|
162,303
|
|
||||
Financing expense associated with beneficial conversion of Senior Secured Promissory Notes
|
—
|
|
|
235,534
|
|
|
1,328,439
|
|
|
454,235
|
|
||||
Other interest expense, net
|
13,172
|
|
|
153,804
|
|
|
27,976
|
|
|
305,614
|
|
||||
Depreciation Expense
|
139,184
|
|
|
121,103
|
|
|
237,934
|
|
|
231,491
|
|
||||
Amortization Expense
|
267,638
|
|
|
333,977
|
|
|
530,234
|
|
|
667,954
|
|
||||
Share Based Compensation
|
1,502,447
|
|
|
585,215
|
|
|
2,487,239
|
|
|
1,086,200
|
|
||||
Earnings Before Interest, Taxes, Depreciation, Amortization and Share-Based Compensation
|
$
|
1,165,052
|
|
|
$
|
922,779
|
|
|
$
|
2,284,300
|
|
|
$
|
1,236,764
|
|
·
|
The announcement or introduction of new products by our competitors;
|
·
|
Failure of government and private health plans to adequately and timely reimburse the users of our products;
|
.
|
Removal of our products from the Federal Supply Schedule or change in the prices that government accounts will pay for our products;
|
·
|
Our ability to upgrade and develop our systems and infrastructure to accommodate growth;
|
·
|
Our ability to attract and retain key personnel in a timely and cost effective manner;
|
·
|
The amount and timing of operating costs and capital expenditures relating to the expansion of our business, operations and infrastructure;
|
·
|
Regulation by federal, state or local governments; and
|
·
|
General economic conditions as well as economic conditions specific to the healthcare industry.
|
·
|
Significantly greater name recognition;
|
·
|
Established relations with surgeons, hospitals, other healthcare providers and third party payers;
|
·
|
Large and established sales and distribution networks in the United States and/or in international markets;
|
·
|
Greater experience in obtaining and maintaining regulatory approvals and/or clearances from the United States Food and Drug Administration and other regulatory agencies;
|
·
|
Greater financial, managerial and other resources for product research and development, sales and marketing efforts and protecting and enforcing intellectual property rights.
|
·
|
Their lack of experience with prior procedures in the field using our products;
|
·
|
Lack of evidence supporting additional patient benefits and our products over conventional methods;
|
·
|
Perceived liability risks generally associated with the use of new products and procedures;
|
·
|
Limited availability of reimbursement from third party payers; and
|
·
|
The time that must be dedicated to training.
|
·
|
We may not be able to obtain regulatory clearance or approvals for such products, or the approved indication may be narrower than we seek;
|
·
|
Such products may not prove to be safe and effective in preclinical or clinical trials;
|
·
|
Physicians or hospitals may not receive any reimbursement from third party payers, or the level of reimbursement may
|
·
|
We may experience delays in our development programs;
|
·
|
Any products that are approved may not be accepted in the marketplace by physicians or patients;
|
·
|
We may not be able to manufacture any such products in commercial quantities or at an acceptable cost; and
|
·
|
Rapid technological change may make such products obsolete.
|
·
|
Fluctuations in currency exchange rates;
|
·
|
Regulatory, product approval and reimbursement requirements;
|
·
|
Tariffs and other trade barriers;
|
·
|
Greater difficulty in accounts receivable collection and longer collection periods;
|
·
|
Difficulties and costs of managing foreign distributors;
|
·
|
Reduced protection for intellectual property rights in some countries;
|
·
|
Burdens of complying with a wide variety of foreign laws;
|
·
|
The impact of recessions in economies outside the U.S.;
|
·
|
Political and economic instability; and
|
·
|
U.S. Export regulatory restrictions.
|
·
|
It must be minimally manipulated;
|
·
|
It must be intended for homologous use;
|
·
|
Its manufacture does not involve combination with another article, except for water, crystalloids or a sterilizing, preserving or storage agent; and
|
·
|
It does not have a systemic effect and is not dependent upon the metabolic activity of living cells for its primary function.
|
·
|
Untitled letters, warning letters, fines, injunctions, consent decrees and civil penalties;
|
·
|
Customer notifications for repair, replacement, refunds;
|
·
|
Recall, detention or seizure of our products;
|
·
|
Operating restrictions or partial suspension or total shutdown of production;
|
·
|
Refusing or delaying our requests for 510(k) clearance or premarket approval of new products or modified products;
|
·
|
Withdrawing 510(k) clearances or PMA approvals that have already been granted;
|
·
|
Refusal to grant export approval for our products; or
|
·
|
Fluctuations in stock market prices and trading volumes of similar companies or of the markets generally;
|
·
|
Our ability to successfully launch, market and earn significant revenue from our products;
|
·
|
Our ability to obtain additional financing to support our continuing operations;
|
·
|
Disclosure of the details and results of regulatory applications and proceedings;
|
·
|
Changes in government regulations or our failure to comply with any such regulations;
|
·
|
Additions or departures of key personnel;
|
·
|
Our investments in research and development or other corporate resources;
|
·
|
Announcements of technological innovations or new commercial products by us or our competitors;
|
·
|
Developments in the patents or other proprietary rights owned or licensed by us or our competitors;
|
·
|
The timing of new product introductions;
|
·
|
Actual or anticipated fluctuations in our operating results, including any restatements of previously reported results;
|
·
|
Our ability to effectively and consistently manufacture our products and avoid costs associated with the recall of defective or potentially defective products;
|
·
|
Our ability and the ability of our distribution partners to market and sell our products;
|
·
|
Changes in reimbursement for our products or the price for our products to our customers;
|
·
|
Removal of our products from the Federal Supply Schedule, or changes in how government accounts purchase products such as ours or in the price for our products to government accounts; and
|
.
|
The other risks detailed in this Item IA.
|
·
|
Authorizing the issuance of preferred stock that can be created and issued by the Board of Directors without prior common stock shareholder approval, with rights senior to those of the common stock;
|
·
|
Restricting persons who may call shareholder meetings;
|
·
|
Electing directors on a staggered basis; and
|
.
|
Allowing the Board to fill vacancies and to fix the number of directors.
|
Exhibit
Number
|
Reference
|
Description
|
|
|
|
3.1#
|
|
Articles of Incorporation as filed with the Secretary of State of Florida on March 31, 2008
|
3.2#
|
|
Articles of Amendment to Articles of Incorporation as filed with the Secretary of the State of Florida on May 14, 2010
|
3.3#
|
|
Articles of Amendment to Articles of Incorporation as filed with the Secretary of the State of Florida on August 8, 2012
|
3.4#
|
|
Articles of Amendment to Articles of Incorporation as filed with the Secretary of the State of Florida on November 8, 2012
|
3.5
|
|
Bylaws of MiMedx Group, Inc. (incorporated by reference to Exhibit 3.2 filed with Registrant's Form 8-K filed on April 2, 2008)
|
3.6
|
|
Amendment to the Bylaws of MiMedx Group, Inc. adopted by the Board of Directors on May 11, 2010 (incorporated by reference to Exhibit 3.2 to the Registrant's Form 8-K filed on May 14, 2010)
|
10.1
|
|
First Amendment to Change of Control Severance Agreement dated May 9, 2013 by and between MiMedx Group, Inc. and William C. Taylor (incorporated by reference 10.2 to the Registrant's Form 8-K filed on May 15, 2013)
|
10.2
|
|
First Amendment to Change of Control Severance Agreement dated May 9, 2013 by and between MiMedx Group, Inc. and Michael J. Senken (incorporated by reference 10.2 to the Registrant's Form 8-K filed on May 15, 2013)
|
10.3
|
|
Loan Agreement between MiMedx Group, Inc., and Bank of America N.A. (incorporated by reference to Exhibit 10.1 to the Registrant's Form 8-K filed on May 23, 2013)
|
10.4#
|
|
Security Agreement dated May 17, 2013, executed by MiMedx Group, Inc. in favor of Bank of America and Bank of America Corporation and its subsidiaries and affiliates
|
10.65
|
|
Form of Indemnification Agreement( incorporated by reference to Exhibit 10.65 to the Registrant's Form 8-K filed on July 15, 2008)
|
10.66#
|
|
Form of Restricted Stock Agreement for Directors
|
31.1 #
|
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
31.2 #
|
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
32.1 #
|
|
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
32.2 #
|
|
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
101.INS
|
|
XBRL Instance Document
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
#
|
Filed herewith
|
August 8, 2013
|
|
|
|
|
By:
|
/s/ Michael J. Senken
|
|
|
|
Michael J. Senken
|
|
|
|
Chief Financial Officer
|
|
(a)
|
the annual dividend rate, if any, on shares of such series, the times of payment and the date from which dividends shall be accumulated, if dividends are to be cumulative;
|
(b)
|
whether the shares of such series shall be redeemable and, if so, the redemption price and the terms and conditions of such redemption;
|
(c)
|
the obligation, if any, of the Corporation to redeem shares of such series pursuant to a sinking fund;
|
(d)
|
whether shares of such series shall be convertible into, or exchangeable for, shares of stock of any other class or classes and, if so, the terms and conditions of such conversion or exchange, including the price or prices or the rate or rates of conversion or exchange and the terms of adjustment, if any;
|
(e)
|
whether the shares of such series shall have voting rights, in addition to the voting rights provided by law, and, if so, the extent of such voting rights;
|
(f)
|
the rights of the shares of stock series in the event of voluntary or involuntary liquidation, dissolution or winding-up of the Corporation; and
|
(g)
|
any other relative rights, powers, preferences, qualifications, limitations or restrictions thereof relating to such series.
|
(a)
|
dividends may be declared and paid or set apart for payment upon the Common Stock out of any assets or funds of the Corporation legally available for the payment of dividends;
|
(b)
|
the holders of Common Stock shall have the right to vote for the election of Directors and on all other matters requiring shareholder action, each share being entitled to one vote; and
|
(c)
|
upon the voluntary or involuntary liquidation, dissolution or winding-up of the Corporation, the net assets of the Corporation available for distribution shall be distributed pro rata to the holders of the Common Stock in accordance with their respective rights and interests.
|
|
|
|
|
|
By:
|
|
/s/ Steve Gorlin
|
|
Name:
|
|
Steve Gorlin
|
|
Title:
|
|
Incorporator
|
1.
|
The name of the corporation is MiMedx Group, Inc. (the “Corporation”).
|
2.
|
Pursuant to Section 607.1003 of the Florida Business Corporation Act (the “Act”), these Articles of Amendment (“Articles of Amendment”) amend the Articles of Incorporation of the Corporation filed in the Office of the Department of State of the State of Florida on February 28, 2008, as amended by the Articles of Merger filed in the Office of the Department of State of the State of Florida on March 31, 2008 (as amended, the “Amended Articles”).
|
3.
|
These Articles of Amendment were duly adopted by the Board of Directors of the Corporation in accordance with the provisions of Section 607.1003 of the Act March 31, 2010.
|
4.
|
These Articles of Amendment were duly approved by holders of a majority of the outstanding shares of the Common Stock of the Corporation in accordance with the provisions of Section 607.1003 of the Act and the Amended Articles on May 11, 2010.
|
5.
|
The Amended Articles are hereby amended by deleting Article 10 in its entirety, and inserting the following text in lieu thereof:
|
(a)
|
The number of directors shall consist of not less than three members, the exact number of which shall be fixed from time to time by resolution adopted by the Board of Directors; provided, that no decrease in the number of directors shall have the effect of shortening the term of any incumbent director. Directors shall be natural persons 18 years of age or older, but need not be residents of the State of Florida or shareholders of the Corporation.
|
(b)
|
The members of the Board of Directors elected at the 2010 annual meeting of Shareholders shall be divided into three classes, designated as Class I, Class II, and Class III as specified in the resolution adopted by Shareholders at such meeting. Each Class shall consist, as nearly as may be possible, of one-third of the total number of directors constituting the entire Board of Directors. The Class I directors elected at the 2010 annual meeting of Shareholders shall be deemed elected for a three-year term, Class II directors for a two-year term, and Class III directors for a one-year term. Each director shall hold office until the next annual meeting of Shareholders upon which his/her term expires and until his/her successor is elected and qualified, or until his/her earlier death, resignation or removal. At each succeeding annual meeting of Shareholders, successor directors to the Class of directors whose term expires at that annual meeting of Shareholders shall be elected for a three-year term. If the number of directors has changed, any increase or decrease shall be apportioned among the Classes so as to maintain the number of directors in each Class as nearly equal as possible.
|
(c)
|
Any vacancies occurring on the Board of Directors, including a vacancy resulting from an increase in the number of directors, may be filled only by the affirmative
|
(d)
|
A director may be removed from office only for cause as hereinafter defined and at a meeting of Shareholders called expressly for that purpose by a vote of the holders of 66-2/3% of the shares cast that are entitled to vote at an election of directors. For purposes of this provision, “cause" shall mean (i) a conviction of a felony regardless of whether it relates to the Corporation or its securities; (ii) declaration of incompetency or unsound mind by court order; or (iii) commission of an action that constitutes intentional misconduct or a knowing violation of law that, in either case, results in a material injury to the Corporation.”
|
|
|
|
|
|
MIMEDX GROUP, INC.
|
||
|
|
|
|
|
By:
|
|
/s/ Parker H. Petit
|
|
Name:
|
|
Parket H. Petit
|
|
Its:
|
|
Chairman & CEO
|
1.
|
The name of the corporation is MiMedx Group, Inc. (the “Corporation”).
|
2.
|
Pursuant to Section 607.1003 of the Florida Business Corporation Act (the “Act”), these Articles of Amendment (“Articles of Amendment”) amend the Articles of Incorporation of the Corporation filed in the Office of the Department of State of the State of Florida on February 28, 2008, as amended by the Articles of Merger filed in the Office of the Department of State of the State of Florida on March 31, 2008, and the Articles of Amendment filed in the Office of the Department of State of the State of Florida on May 14, 2010, (as amended, the “Amended Articles”).
|
3.
|
These Articles of Amendment were duly adopted by the Board of Directors of the Corporation on November 14, 2011, in accordance with the provisions of Section 607.1003 of the Act.
|
4.
|
These Articles of Amendment were duly approved by holders of a majority of the outstanding shares of the Common Stock of the Corporation in accordance with the provisions of Section 607.1003 of the Act and the Amended Articles on December 14, 2011.
|
5.
|
The Amended Articles are hereby amended by deleting the first paragraph of Article 3 in its entirety, and inserting the following text in lieu thereof:
|
|
|
|
|
|
MIMEDX GROUP, INC.
|
||
|
|
|
|
|
By:
|
|
/s/ Michael J. Senken
|
|
Name:
|
|
Michael J. Senken
|
|
Its:
|
|
Chief Financial Officer
|
1.
|
The name of the corporation is MiMedx Group, Inc. (the “Corporation”).
|
2.
|
Pursuant to Section 607.1003 of the Florida Business Corporation Act (the “Act”), these Articles of Amendment (“Articles of Amendment”) amend the Articles of Incorporation of the Corporation filed in the Office of the Department of State of the State of Florida on February 28, 2008, as amended by the Articles of Merger filed in the Office of the Department of State of the State of Florida on March 31, 2008, the Articles of Amendment filed in the Office of the Department of State of the State of Florida on May 14, 2010, and the Articles of Amendment filed in the Office of the Department of State of the State of Florida on August 8, 2012 (as amended, the “Amended Articles”).
|
3.
|
These Articles of Amendment were duly adopted by the Board of Directors of the Corporation in accordance with the provisions of Section 607.1003 of the Act on August 2, 2012.
|
4.
|
These Articles of Amendment were duly approved by holders of a majority of the outstanding shares of the Common Stock of the Corporation in accordance with the provisions of Section 607.1003 of the Act and the Amended Articles on October 31, 2012.
|
5.
|
The Amended Articles are hereby amended by deleting the first paragraph of Article 3 in its entirety, and inserting the following text in lieu thereof:
|
|
|
|
|
|
MIMEDX GROUP, INC.
|
||
|
|
|
|
|
By:
|
|
/s/ Roberta L. McCaw
|
|
Name:
|
|
Roberta l. McCaw
|
|
Its:
|
|
Secretary
|
1.
|
Terms of Award and Definitions
. The following additional terms used in this Agreement shall have the meanings set forth in this Section 1:
|
(a)
|
Date of Termination
. The Participant’s “Date of Termination” shall be the first day occurring on or after the Grant Date on which the Participant is neither employed by the Company, a director of the Company, nor an independent contractor performing services for the Company.
|
(b)
|
Designated Beneficiary
. The “Designated Beneficiary” shall be the beneficiary or beneficiaries designated by the Participant in a writing filed with the Committee in such form and at such time as the Committee shall require.
|
(c)
|
Restricted Period
. A “Restricted Period” is the one year period beginning on the Grant Date and ending on the first anniversary of the Grant Date.
|
(d)
|
Restricted Stock
. The number of shares of “Restricted Stock” awarded under this Agreement shall be _________ shares. Shares of “Restricted Stock” are shares of Stock granted under this Agreement and are subject to the terms of this Agreement and the Plan.
|
2.
|
Award
. The Participant is hereby granted the number of shares of Restricted Stock set forth in Section 1.
|
3.
|
Deposit of Shares of Restricted Stock
. Each certificate issued in respect of shares of Restricted Stock granted under this Agreement shall be registered in the name of the Participant and shall be deposited in a bank designated by the Committee. The grant of Restricted Stock is conditioned upon the Participant endorsing in blank a stock power for the Restricted Stock.
|
4.
|
Transfer and Forfeiture of Shares
.
|
(a)
|
If the Participant’s Date of Termination (as defined above) does not occur during a Restricted Period, then, at the end of such Restricted Period, the Participant shall become vested in one hundred percent (100%) of the shares of Restricted Stock, and shall own such shares free of all restrictions otherwise imposed by this Agreement. A certificate reflecting the number of shares of Stock so vested shall be delivered to the Participant as soon as practicable after the end of such Restricted Period, but in any event no later than the fifteenth (15
th
) day following the end of the applicable Restricted Period.
|
(b)
|
If the Participant’s Date of Termination occurs prior to the end of a Restricted Period, the Participant shall forfeit any unvested Restricted Stock as of the Participant’s Date of Termination.
|
(c)
|
Otherwise, shares of Restricted Stock may not be sold, assigned, transferred, pledged or otherwise encumbered until the Participant is vested in the shares.
|
5.
|
Withholding
. Participant must make arrangements, satisfactory to the Company, for satisfaction of any applicable foreign, federal, state or local withholding requirements related to the receipt of Restricted Stock or the lapse of restrictions thereon. If no alternative arrangements are made, the Company may withhold Restricted Stock to satisfy such withholding requirements.
|
6.
|
Heirs and Successors
.
|
(a)
|
This Agreement shall be binding upon, and inure to the benefit of, the Company and the Participant and their respective successors and assigns.
|
(b)
|
If any rights exercisable by the Participant or benefits deliverable to the Participant under this Agreement have not been exercised or delivered, respectively, at the time of the Participant’s death, such rights shall be exercisable by the Designated Beneficiary, and such benefits shall be delivered to the Designated Beneficiary, in accordance with the provisions of this Agreement and the Plan.
|
(c)
|
If a deceased Participant has failed to designate a beneficiary, or if the Designated Beneficiary does not survive the Participant, any rights that would have been exercisable by the Participant and any benefits distributable to the Participant shall be exercised by or distributed to the legal representative of the estate of the Participant.
|
(d)
|
If a deceased Participant has designated a beneficiary but the Designated Beneficiary dies before the Designated Beneficiary’s exercise of all rights under this Agreement or before the complete distribution of benefits to the Designated Beneficiary under this Agreement, then any rights that would have been exercisable by the Designated Beneficiary shall be exercised by the legal representative of the estate of the Designated Beneficiary, and any benefits distributable to the Designated Beneficiary shall be distributed to the legal representative of the estate of the Designated Beneficiary.
|
7.
|
Substituted or Additional Shares.
If, from time to time during the term of this Agreement, there is any stock split-up, stock dividend, stock distribution or other reclassification of the Company’s Common Stock, any and all new, substituted or additional securities to which the Participant is entitled by reason of his or her ownership of the Restricted Stock shall be immediately subject to the terms of this Agreement.
|
8.
|
Plan Governs
. Notwithstanding anything in this Agreement to the contrary, the terms of this Agreement shall be subject to, and governed by, the terms of the Plan, a copy of which is enclosed with this Agreement; and this Agreement is subject to all interpretations, amendments, rules and regulations promulgated by the Committee from time to time pursuant to the Plan. In the event of any conflict between the terms of the Plan and this Agreement, the terms of the Plan shall govern.
|
9.
|
Charges, Taxes and Expenses
. The issuance of certificates for shares of Restricted Stock shall be made without charge to the Participant for any transfer tax or other such expense imposed or incurred with respect to the issuance of such certificates, all of which taxes and expenses shall be paid by the Company.
|
10.
|
Governing Law.
The governing laws applicable to the Plan shall govern this Agreement.
|
Date: August 02, 2013
|
/s/ Parker H. Petit
|
|
Parker H. Petit
|
|
Chief Executive Officer
|
Date: August 02, 2013
|
/s/ Michael J. Senken
|
|
Michael J. Senken
|
|
Chief Financial Officer
|
Date: August 02, 2013
|
/s/ Parker H. Petit
|
|
Parker H. Petit
|
|
Chief Executive Officer
|
Date: August 02, 2013
|
/s/ Michael J. Senken
|
|
Michael J. Senken
|
|
Chief Financial Officer
|