On September 23, 2020, Conformis, Inc., a Delaware corporation (“Conformis”), and a healthcare focused institutional investor entered into a subscription agreement (the “Subscription Agreement”), to which Conformis agreed to sell (i) 8,512,088 shares (the “Shares”) of its common stock (“Common Stock”) and accompanying warrants (“Warrants”) to purchase up to 8,512,088 shares of Common Stock and (ii) pre-funded warrants (“Pre-Funded Warrants”) to purchase up to 9,492,953 shares of Common Stock and accompanying Warrants to purchase up to 9,492,953 shares of Common Stock in a registered direct offering (the “Offering”) for gross proceeds of approximately $17.25 million. The Shares (or Pre-Funded Warrants in lieu thereof) and accompanying Warrants are being sold in units, each consisting of one Share (or a Pre-Funded Warrant to purchase one share of Common Stock in lieu thereof) and a Warrant to purchase one share of Common Stock, at an offering price of $0.9581 per unit.

The Pre-Funded Warrants will be exercisable immediately, have an exercise price of $0.0001 per share and will be exercisable until all of the Pre-Funded Warrants are exercised in full. The Warrants will be exercisable immediately, have an exercise price of $0.8748 per share, and will expire five years from the date of issuance. The Pre-Funded Warrants and the Warrants each prohibit the holder from exercising any portion thereof to the extent that the holder would own more than 9.99% of the number of shares of Common Stock outstanding immediately after exercise. The number of shares issuable upon exercise of the Warrants and Pre-Funded Warrants and the exercise price of the Warrants and Pre-Funded Warrants is adjustable in the event of stock splits, stock dividends, combinations of shares and similar recapitalization transactions. The Offering is expected to close on or about September 28, 2020, subject to the satisfaction of customary closing conditions.

The net proceeds to Conformis from the Offering are expected to be approximately $16.1 million after deducting Oppenheimer’s fees and expenses, but excluding Conformis’ estimated offering expenses and the proceeds, if any, from the exercise of Warrants and Pre-Funded Warrants issued in the Offering.

Conformis also entered into a placement agent agreement (the “Placement Agent Agreement”) with Oppenheimer & Co. Inc. (“Oppenheimer”) on September 23, 2020, to which Oppenheimer agreed to serve as exclusive placement agent for the Offering. Conformis has agreed to pay Oppenheimer an aggregate fee up to 6% of the gross proceeds received in the Offering and reimburse Oppenheimer for reasonable out-of-pocket expenses in an amount not to exceed $70,000.

As part of the Purchase Agreement, Conformis agreed to a 90-day “lock-up” with respect to shares of Common Stock, including securities that are convertible into, or exchangeable or exercisable for, shares of Common Stock. In addition, Conformis’ executive officers and directors agreed to a 90-day “lock-up” with respect to shares of Common Stock, and other securities beneficially owned, including securities that are convertible into, or exchangeable or exercisable for, shares of Common Stock. Subject to certain exceptions, during the lock-up period, the Company and its executive officers and directors may not offer, sell, pledge or otherwise dispose of the foregoing securities without the prior written consent of Oppenheimer.

The Placement Agent Agreement contains customary representations, warranties and covenants by the Company, customary conditions to closing, indemnification obligations of the Company and the Placement Agent, including for liabilities under the Securities Act of 1933, as amended, other obligations of the parties and termination provisions. The representations, warranties and covenants contained in the Placement Agent Agreement were made only for purposes of such agreement and as of specific dates, were solely for the benefit of the parties to such agreement, and may be subject to limitations agreed upon by the contracting parties.

The Shares, Pre-Funded Warrants, Warrants, and shares of common stock issuable upon exercise of the Pre-Funded Warrants and Warrants will be issued to a prospectus supplement that will be filed with the Securities and Exchange Commission in connection with a takedown from Conformis’ effective shelf registration statement on Form S-3 (File No. 333-237351) and the base prospectus dated as of August 5, 2020 contained in such registration statement.

Upon closing of the Offering and combined with prior applicable payments and proceeds received in 2020 prior to the Offering, the Company will have satisfied the capital raise covenant in its Loan and Security Agreement with Innovatus Life Sciences Lending Fund I to receive aggregate gross proceeds from the issuance of equity securities or other certain specified payments of not less than $20 million by December 31, 2020.

The description of terms and conditions of the Placement Agent Agreement, the form of Pre-Funded Warrant, the form of Warrant and the Subscription Agreement set forth herein do not purport to be complete and are qualified in their entirety by the full text of the Placement Agent Agreement, the form of Pre-Funded Warrant, the form of Warrant and the Subscription Agreement, which are attached hereto as Exhibits 1.1, 4.1, 4.2 and 10.1, respectively, and incorporated herein by reference. A copy of the legal opinion of Hogan Lovells US LLP relating to the legality of the issuance and sale of the Shares, Pre-Funded Warrants, Warrants and shares of Common Stock issuable upon exercise of the Pre-Funded Warrants and Warrants is filed herewith as Exhibit 5.1. On September 24, 2020, the Company issued a press release in connection with the Offering, which is attached as Exhibit 99.1 hereto and incorporated by reference herein.

This Current Report on Form 8-K shall not constitute an offer to sell or the solicitation of an offer to buy securities, nor shall there be any sale of securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.

Conformis Inc Exhibit
EX-1.1 2 ex1_1xconformis-placementa.htm EXHIBIT 1.1 Exhibit Execution VersionCONFORMIS,…
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About Conformis, Inc. (NASDAQ:CFMS)

ConforMIS, Inc. is a medical technology company that uses its iFit Image-to-Implant technology platform to develop, manufacture and sell joint replacement implants. The Company’s products include iTotal CR, which is the cruciate-retaining, customized total knee replacement system to restore the natural shape of a patient’s knee; iTotal PS, which is the posterior cruciate ligament substituting, or posterior-stabilized, customized total knee replacement product to restore the natural shape of a patient’s knee; iDuo, which is the customized bicompartmental knee replacement system, and iUni, which is the customized unicompartmental knee replacement product for treatment of the medial or lateral compartment of the knee. Its iFit technology platform comprises three elements: iFit Design, iFit Printing and iFit Just-in-Time Delivery. The Company markets and sells its products in the United States, Germany, the United Kingdom, Austria, Ireland, Switzerland, Singapore and Hong Kong.