Business Context and Reporting Period
This Form 8-K is filed by Aziyo Biologics, Inc. (trading symbol: AZYO) on August 31, 2022. The filing serves to update the Company's previously filed Annual Report on Form 10-K for the year ended December 31, 2021, in connection with an expected registration statement on Form S-3 to register up to $50,000,000 of securities.
Key Financial Metrics and Liquidity
The filing does not provide specific numerical values for revenue, profit, cash flow, or margins for the period ended December 31, 2021, as it references the previously filed Form 10-K for those details. However, it discloses the following material financial updates:
- Going Concern: The Company has disclosed substantial doubt about its ability to continue as a going concern, a condition arising after the initial filing of the Form 10-K.
- Debt Refinancing: The Company entered into a new term loan facility with SWK Funding LLC, refinancing its existing term loan with Midcap Financial Trust and repaying its existing revolving credit facility.
- Liquidity Facilities: The new term loan facility provides for a separate, new asset-based revolving credit facility of up to $8.0 million. As of August 31, 2022, the Company has not yet entered into this revolving credit facility.
Material Changes Versus Prior Period
The primary material changes disclosed in this filing relate to updates in the notes to the consolidated financial statements compared to the original Form 10-K filed on March 8, 2022:
- Note 2 Update: Added disclosure regarding substantial doubt about the Company's ability to continue as a going concern and details of the new term loan facility with SWK Funding LLC.
- Note 19 Addition: Added a new note describing unaudited subsequent events that occurred after the Form 10-K filing date.
- Accounting Firm Report: The independent registered public accounting firm's report now includes an explanatory paragraph regarding the going concern uncertainty.
Guidance, Outlook, and Risks
Outlook and Capital Markets: The Company expects to file a Form S-3 registration statement to register up to $50,000,000 of Class A common stock, Class B common stock, preferred stock, debt securities, warrants, and/or units.
Risks and Contingencies: The most significant risk highlighted is the substantial doubt regarding the Company's ability to continue as a going concern. The filing explicitly states that no attempt has been made to reflect other events or occurrences after the Form 10-K filing date, and investors should read this report in conjunction with the Form 10-K and subsequent filings.
Investor Verification Checklist
- Verify the specific financial figures for revenue, net loss, and cash position in the original Form 10-K for the year ended December 31, 2021.
- Review the terms of the new term loan facility with SWK Funding LLC and the status of the $8.0 million revolving credit facility.
- Assess the Company's capital raise strategy via the expected Form S-3 filing to address the going concern uncertainty.
- Confirm the status of the independent auditor's report regarding the going concern qualification.