Business Context and Reporting Period
This Form 8-K is a Current Report filed by Ra Medical Systems, Inc. (RMED) on September 20, 2022. The filing details the results of a Special Meeting of Stockholders held on the same date and the implementation of a reverse stock split. The report also references a pending merger agreement with Catheter Precision, Inc., a privately held medical device company focused on cardiac electrophysiology, announced on September 12, 2022.
Key Financial Metrics and Capital Structure Changes
The filing does not report standard operating financial metrics such as revenue, profit, cash flow, or debt levels for the period. Instead, it focuses on capital structure adjustments:
- Reverse Stock Split: A 1-for-50 reverse stock split was approved and will be effective at 4:01 p.m. Eastern time on September 30, 2022.
- Share Count Reduction: The number of issued and outstanding shares will be reduced from approximately 54,514,828 to approximately 1,090,296.
- Trading Symbol: The common stock will continue to trade under the symbol RMED on the NYSE American, with a new CUSIP number (74933X 302).
- Fractional Shares: No fractional shares will be issued; holders entitled to fractional shares will receive a cash payment based on the closing sale price on the effective date.
Material Changes and Stockholder Votes
At the Special Meeting, approximately 58.18% of outstanding shares were represented. Stockholders approved three key proposals:
- Warrant Exercise Approval: Approved the issuance of more than 19.99% of outstanding common stock upon the exercise of Series C Common Stock Purchase Warrants.
- Votes For: 17,035,081
- Votes Against: 2,239,526
- Reverse Stock Split: Approved the amendment to the Certificate of Incorporation to effect a reverse stock split between 1-for-20 and 1-for-50. The Board selected the 1-for-50 ratio.
- Votes For: 27,370,010
- Votes Against: 3,316,472
- Adjournment: Approved the adjournment of the meeting if necessary to solicit further votes (not required as proposals passed).
- Votes For: 27,538,554
- Votes Against: 3,063,629
Outlook, Risks, and Contingencies
Merger with Catheter Precision: The Company is in the process of a stock-for-stock reverse merger with Catheter Precision, Inc. The transaction is expected to close before the end of 2022, subject to conditions including shareholder approval and a minimum prevailing stock price for Ra Medical.
Risks and Contingencies:
- Stock Price Condition: If Ra Medical's stock price drops below certain levels, the merger consideration for Catheter stockholders may be adversely impacted. The parties reserve the right to waive this condition.
- Capital Requirements: The combined company must access capital markets to meet Net Cash requirements of the Merger Agreement.
- Listing Status: There is a risk regarding the ability to maintain listing on the NYSE American or other national exchanges.
- Forward-Looking Statements: Actual outcomes may differ due to uncertainties related to the merger consummation, regulatory approvals, and the impact of the COVID-19 pandemic.
Investor Verification Checklist
- Verify the effective date and time of the 1-for-50 reverse stock split (September 30, 2022, 4:01 p.m. ET) and the resumption of trading on October 3, 2022.
- Confirm the new CUSIP number (74933X 302) for post-split shares.
- Review the definitive Proxy Statement for the proposed merger with Catheter Precision, Inc., specifically regarding the minimum stock price condition and Net Cash requirements.
- Check the status of the Series C Common Stock Purchase Warrants and the implications of the approved issuance of additional shares.
- Monitor the Company's ability to satisfy closing conditions for the merger before the end of 2022.