DEFM14A
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SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

 

Filed by the Registrant  ☒

Filed by a Party other than the Registrant  ☐

Check the appropriate box:

 

Preliminary Proxy Statement

 

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

 

Definitive Proxy Statement

 

Definitive Additional Materials

 

Soliciting Material under §240.14a-12

SeaSpine Holdings Corporation

(Name of Registrant as Specified in Its Charter)

(Name of Person(s) Filing Proxy Statement, if other Than the Registrant)

Payment of Filing Fee (Check all boxes that apply):

 

No fee required.

 

Fee previously paid with preliminary materials

 

Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11

 

 

 


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LOGO    LOGO

TRANSACTION PROPOSED — YOUR VOTE IS VERY IMPORTANT

Dear Stockholders:

On October 10, 2022, Orthofix Medical Inc., or Orthofix, Orca Merger Sub Inc., a wholly owned subsidiary of Orthofix, or Merger Sub, and SeaSpine Holdings Corporation, or SeaSpine, entered into an Agreement and Plan of Merger, or the merger agreement, pursuant to which, subject to approval of Orthofix stockholders and SeaSpine stockholders and the satisfaction or (to the extent permitted by law) waiver of other specified closing conditions, the Orthofix and SeaSpine businesses will combine in an all-stock merger of equals. At the effective time of the merger, Merger Sub will merge with and into SeaSpine, with SeaSpine surviving the merger and becoming a wholly owned subsidiary of Orthofix. Each of the common stock of Orthofix and the common stock of SeaSpine is traded on the Nasdaq Global Select Market under the symbols “OFIX” and “SPNE,” respectively. The parties expect to rename Orthofix (as the parent entity in the combined company structure) prior to the transaction’s closing. Orthofix intends to file an initial listing application for the combined company with the Nasdaq Global Select Market, which will reflect any revision to the combined company’s trading symbol.

If the merger is completed, at the effective time of the merger, each share of SeaSpine common stock (other than shares held by SeaSpine as treasury stock) will be converted into the right to receive 0.4163 fully paid and nonassessable shares of Orthofix common stock (and, if applicable, cash in lieu of fractional shares), or the merger consideration, less any applicable withholding taxes. Also at the effective time of the merger, outstanding restricted stock units to acquire shares of SeaSpine common stock will be assumed by Orthofix and converted into restricted stock units to acquire shares of Orthofix common stock, and outstanding options to purchase shares of SeaSpine common stock will be assumed by Orthofix and converted into options to purchase shares of Orthofix common stock, in each case with necessary adjustments to reflect the exchange ratio. For more details on the merger consideration, see “The Merger Agreement — Merger Consideration.”

The market value of Orthofix common stock at the time of completion of the merger could be greater than, less than or the same as the market value of Orthofix common stock on the date of the accompanying joint proxy statement/prospectus.

Each share of Orthofix common stock, each option to purchase shares of Orthofix common stock and each Orthofix restricted stock unit, performance stock unit and deferred stock unit that is outstanding at the effective time of the merger will remain outstanding in accordance with its terms and such shares of common stock, options, restricted stock units, performance stock units and deferred stock units will be unaffected by the merger (except for certain performance achievement and post-separation acceleration and extended exercise rights that will exist following completion of the merger, as further described beginning on page 139 in “Interests of Orthofix’s Directors and Executive Officers in the Merger”). Based on the number of shares of SeaSpine common stock outstanding and reserved for issuance, Orthofix expects to issue an aggregate of approximately 16.6 million shares of Orthofix common stock to holders of SeaSpine common stock in the merger. This estimate is based on the number of outstanding shares of SeaSpine common stock as of October 7, 2022, including share equity awards and exchangeable shares but excluding outstanding options (as such options are not currently expected to be exercised prior to closing given the applicable exercise prices). Based on the current number of shares of SeaSpine common stock outstanding and reserved for issuance, and the current number of shares of Orthofix common stock outstanding and reserved for issuance, we estimate that, immediately following completion of the merger, former holders of SeaSpine common stock will own approximately 43.5%, and pre-merger holders of Orthofix common stock will own approximately 56.5%, of the outstanding common stock on a diluted basis (calculated using the treasury stock method).


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Each of Orthofix and SeaSpine is holding a special meeting of its stockholders to vote on the proposals necessary to complete the merger. Information about each meeting, the merger and the other business to be considered by stockholders at each special meeting is contained in this joint proxy statement/prospectus. Any stockholder entitled to attend and vote at the applicable special meeting is entitled to appoint a proxy to attend and vote on such stockholder’s behalf. Such proxy need not be a holder of Orthofix common stock or SeaSpine common stock. We urge you to read this joint proxy statement/prospectus and the annexes and documents incorporated by reference carefully. You should also carefully consider the risks that are described in the “Risk Factors” section beginning on page 33.

Your vote is very important regardless of the number of shares of Orthofix common stock or SeaSpine common stock that you own. The merger cannot be completed without (1) the adoption of the merger agreement by the affirmative vote of holders of a majority of the shares of SeaSpine common stock outstanding as of the SeaSpine record date and entitled to vote on the proposal and (2) the approval of the issuance of Orthofix common stock to SeaSpine stockholders in connection with the merger by the affirmative vote of a majority in voting power of the shares of Orthofix common stock present in person or represented by proxy at the Orthofix special meeting and entitled to vote on the proposal.

Whether or not you plan to attend the Orthofix special meeting or the SeaSpine special meeting, please submit your proxy as soon as possible to make sure that your shares are represented at the applicable meeting.

On behalf of the boards of directors of Orthofix and SeaSpine, thank you for your consideration and continued support.

 

LOGO

 

Jon C. Serbousek

President, Chief Executive Officer and Director

Orthofix Medical Inc.

  

LOGO

 

Keith C. Valentine

President, Chief Executive Officer and Director

SeaSpine Holdings Corporation

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the merger or the other transactions described in this joint proxy statement/prospectus or the securities to be issued in connection with the merger or determined if this joint proxy statement/prospectus is accurate or complete. Any representation to the contrary is a criminal offense.

The accompanying joint proxy statement/prospectus is dated November 22, 2022 and is first being mailed to stockholders of Orthofix and stockholders of SeaSpine on or about November 23, 2022.


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LOGO

ORTHOFIX MEDICAL INC.

3451 Plano Parkway

Lewisville, Texas 75056

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

To be held on January 4, 2023

To the Stockholders of Orthofix Medical Inc.:

We are pleased to invite you to attend — and notice is hereby given that Orthofix Medical Inc., referred to as Orthofix, will hold — a special meeting of its stockholders, referred to as the Orthofix special meeting, at Hampton Inn & Suites, 3650 Plano Pkwy, The Colony, TX 75056 on January 4, 2023, at 11 a.m. Central Time for the following purposes:

1. Approval of the Orthofix Share Issuance. To vote on a proposal to approve the issuance of Orthofix common stock, par value $0.10 per share, to SeaSpine stockholders in connection with the merger, as contemplated by the Agreement and Plan of Merger, referred to as the merger agreement, dated as of October 10, 2022, by and among Orthofix Medical Inc., Orca Merger Sub Inc. and SeaSpine Holdings Corporation, referred to as the Orthofix share issuance proposal; and

2. Adjournment of the Orthofix Special Meeting. To vote on a proposal to approve the adjournment of the Orthofix special meeting to a later date or dates, if necessary or appropriate, to solicit additional proxies in the event there are not sufficient votes at the time of the Orthofix special meeting to approve the Orthofix share issuance proposal, referred to as the Orthofix adjournment proposal.

Orthofix will transact no other business at the Orthofix special meeting, except such business as may properly be brought before the Orthofix special meeting or any adjournment or postponement thereof. Please refer to the joint proxy statement/prospectus of which this notice is a part for further information with respect to the business to be transacted at the Orthofix special meeting.

The Orthofix board of directors, referred to as the Orthofix Board, has fixed the close of business on November 10, 2022 as the record date for the Orthofix special meeting, referred to as the Orthofix record date. Only Orthofix stockholders of record at that time are entitled to receive notice of, and to vote at, the Orthofix special meeting or any adjournment or postponement thereof. Orthofix is commencing its solicitation of proxies on or about November 23, 2022. Orthofix will continue to solicit proxies until the date of the Orthofix special meeting.

Completion of the merger is conditioned upon, among other things, approval of the Orthofix share issuance proposal by the Orthofix stockholders, which requires the affirmative vote of a majority in voting power of the shares of Orthofix common stock present in person or represented by proxy at the Orthofix special meeting and entitled to vote on the proposal.

The Orthofix Board has unanimously (a) approved and declared advisable the merger agreement and the transactions contemplated by the merger agreement, including the issuance of shares of Orthofix common stock in the merger, on the terms and subject to the conditions set forth in the merger agreement, (b) determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger and the issuance of Orthofix common shares in the merger, are fair to, and in the best interests of, Orthofix and its stockholders, (c) resolved to recommend the approval of the Orthofix share issuance proposal to the Orthofix stockholders, on the terms and subject to the conditions set forth in the merger agreement, and (d) directed that the Orthofix share issuance proposal be submitted to


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Orthofix stockholders for approval. The Orthofix Board unanimously recommends that Orthofix stockholders vote:

“FOR” the Orthofix share issuance proposal; and

“FOR” the Orthofix adjournment proposal.

Your vote is very important regardless of the number of shares of Orthofix common stock that you own. The votes cast in favor of the Orthofix share issuance proposal must exceed the aggregate of votes cast against the Orthofix share issuance proposal and abstentions. Whether or not you expect to attend the Orthofix special meeting in person, to ensure your representation at the Orthofix special meeting, we urge you to submit a proxy to vote your shares as promptly as possible by (1) visiting the Internet site listed on the Orthofix proxy card, (2) calling the toll-free number listed on the Orthofix proxy card or (3) submitting your Orthofix proxy card by mail by using the provided self-addressed, stamped envelope. Submitting a proxy will not prevent you from voting in person, but it will help to secure a quorum and avoid added solicitation costs. Any eligible holder of Orthofix common stock who is present at the Orthofix special meeting may vote in person, thereby revoking any previous proxy. In addition, a proxy may also be revoked in writing before the Orthofix special meeting in the manner described in the accompanying joint proxy statement/prospectus. If your shares are held in the name of a bank, broker or other nominee, please follow the instructions on the voting instruction card furnished by the bank, broker or other nominee.

You will need to obtain an admission ticket in advance to attend the Orthofix special meeting. To do so, please make your request by mail to Orthofix Investor Relations, 3451 Plano Parkway, Lewisville, Texas 75056, or by email at MergerInfo@Orthofix.com. Orthofix Investor Relations must receive your request for an admission ticket on or before 11:59 p.m. Central Time on January 2, 2023. Seating will be limited and requests for tickets will be processed in the order in which they are received.

If you own shares in “street name” through an account with a bank, broker or other nominee, then send proof of your Orthofix share ownership as of the Orthofix record date (for example, a brokerage firm account statement or a “legal proxy” from your intermediary) along with your ticket request. If you are not sure what proof to send, check with your intermediary.

If your shares are registered in your name with Orthofix’s stock registrar and transfer agent, Computershare Trust Company, N.A., no proof of ownership is required because Orthofix can verify your ownership.

For security reasons, be prepared to show a form of government-issued photo identification when presenting your ticket for admission to the Orthofix special meeting. If you forget to bring your ticket, you will be admitted only if you provide photo identification. If you do not request a ticket in advance, you will be admitted only if space is available and you provide photo identification and satisfactory evidence that you were a stockholder of Orthofix common stock as of the Orthofix record date. If you need special assistance at the Orthofix special meeting because of a disability, please contact Orthofix Investor Relations.

The enclosed joint proxy statement/prospectus provides a detailed description of the merger and the merger agreement and the other matters to be considered at the Orthofix special meeting. We urge you to carefully read this joint proxy statement/prospectus, including any documents incorporated by reference herein, and the annexes in their entirety. If you have any questions concerning either of the proposals in this notice, the merger or the joint proxy statement/prospectus, would like additional copies or need help voting your shares of Orthofix common stock, please contact Orthofix’s proxy solicitor:

Saratoga Proxy Consulting LLC

520 8th Avenue, 14th Floor

New York, New York 10018

(212) 257-1311

(888) 368-0379


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By Order of the Orthofix Medical Inc. Board of Directors,

 

LOGO

Kimberley A. Elting

Chief Legal and Development Officer and President, Global Orthopedics

Lewisville, Texas

November 22, 2022


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LOGO

SEASPINE HOLDINGS CORPORATION

5770 Armada Drive

Carlsbad, California 92008

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

To be held on January 4, 2023

To the Stockholders of SeaSpine Holdings Corporation:

We are pleased to invite you to attend — and notice is hereby given that SeaSpine Holdings Corporation, referred to as SeaSpine, will hold — a special meeting of its stockholders, referred to as the SeaSpine special meeting, at the offices of DLA Piper LLP (US), 4365 Executive Drive, 4th Floor, San Diego, CA 92121 on January 4, 2023 at 9 a.m. Pacific Time for the following purposes:

 

  1.

Adoption of the Merger Agreement. To vote on a proposal to adopt the Agreement and Plan of Merger, dated as of October 10, 2022, by and among Orthofix Medical Inc., Orca Merger Sub Inc. and SeaSpine Holdings Corporation, referred to as the merger agreement, which is further described in the section entitled “The Merger Agreement,” a copy of which merger agreement is attached as Annex A to the joint proxy statement/prospectus accompanying this notice, referred to as the SeaSpine merger proposal;

 

  2.

SeaSpine Merger-Related Compensation. To vote on a proposal to approve, by advisory (non-binding) vote, certain compensation arrangements that may be paid or become payable to SeaSpine’s named executive officers in connection with the merger contemplated by the merger agreement, referred to as the SeaSpine merger-related compensation proposal; and

 

  3.

Adjournment of the SeaSpine Special Meeting. To vote on a proposal to approve the adjournment of the SeaSpine special meeting to a later date or dates, if necessary or appropriate, to solicit additional proxies in the event there are not sufficient votes at the time of the SeaSpine special meeting to approve the SeaSpine merger proposal, referred to as the SeaSpine adjournment proposal.

SeaSpine will transact no other business at the SeaSpine special meeting, except such business as may properly be brought before the SeaSpine special meeting or any adjournment or postponement thereof. Please refer to the joint proxy statement/prospectus of which this notice is a part for further information with respect to the business to be transacted at the SeaSpine special meeting.

The SeaSpine board of directors, referred to as the SeaSpine Board, has fixed the close of business on November 10, 2022 as the record date for the SeaSpine special meeting, referred to as the SeaSpine record date. Only SeaSpine stockholders of record at that time are entitled to receive notice of, and to vote at, the SeaSpine special meeting or any adjournment or postponement thereof. SeaSpine is commencing its solicitation of proxies on or about November 23, 2022. SeaSpine will continue to solicit proxies until the date of the SeaSpine special meeting.

Completion of the merger is conditioned, among other things, upon adoption of the merger agreement by the SeaSpine stockholders, which requires the affirmative vote of holders of a majority of the shares of SeaSpine common stock outstanding as of the SeaSpine record date and entitled to vote on the proposal.

The SeaSpine Board has unanimously approved and declared advisable the merger agreement and the transactions contemplated by the merger agreement, including the merger; determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are advisable, fair to and in the best interests of SeaSpine and its stockholders; and unanimously recommends that SeaSpine stockholders vote:

 

   

“FOR” the SeaSpine merger proposal;

 

   

“FOR” the SeaSpine merger-related compensation proposal; and

 

   

“FOR” the SeaSpine adjournment proposal.


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Your vote is very important regardless of the number of shares of common stock that you own. A failure to vote your shares, or to provide instructions to your bank, broker or nominee as to how to vote your shares, is the equivalent of a vote against the SeaSpine merger proposal. Whether or not you expect to attend the SeaSpine special meeting in person, to ensure your representation at the SeaSpine special meeting, we urge you to submit a proxy to vote your shares as promptly as possible by (1) visiting the Internet site listed on the SeaSpine proxy card, (2) calling the toll-free number listed on the SeaSpine proxy card or (3) submitting your SeaSpine proxy card by mail by using the provided self-addressed, stamped envelope. Submitting a proxy will not prevent you from voting in person, but it will help to secure a quorum and avoid added solicitation costs. Any eligible holder of SeaSpine common stock who is present at the SeaSpine special meeting may vote in person, thereby revoking any previous proxy. In addition, a proxy may also be revoked in writing before the SeaSpine special meeting in the manner described in the accompanying joint proxy statement/prospectus. If your shares are held in the name of a bank, broker or other nominee, please follow the instructions on the voting instruction card furnished by the bank, broker or other nominee.

If you are a stockholder of record as of the SeaSpine record date for the SeaSpine special meeting and you plan to attend the SeaSpine special meeting in person, you will need valid government-issued photo identification to enter the SeaSpine special meeting. If you hold your shares through a bank, broker or other nominee and you plan to attend the SeaSpine special meeting in person, we will admit you only if we can verify that you are a SeaSpine stockholder as of the SeaSpine record date. You will need to bring a letter or account statement demonstrating that you were the beneficial owner of our common stock on the SeaSpine record date, along with valid government-issued photo identification, to be admitted to the SeaSpine special meeting.

If you hold SeaSpine common stock in your name on the SeaSpine record date and plan to attend the SeaSpine special meeting, because of security procedures, you will need to obtain an admission ticket in advance. In addition to obtaining an admission ticket in advance, you will be required to provide valid government-issued photo identification to be admitted to the SeaSpine special meeting. Admission tickets will be available to both registered and beneficial owners of SeaSpine common stock. You may apply for an admission ticket by mail to Office of the Corporate Secretary, 5770 Armada Drive, Carlsbad, California 92008. SeaSpine’s Corporate Secretary must receive your request for an admission ticket on or before 11:59 p.m. Eastern Time on January 2, 2023. If you are a beneficial owner of SeaSpine common stock and hold your shares through a bank, broker or other nominee and you plan to attend the SeaSpine special meeting in person, in addition to following the procedures described above, you will also need to provide proof of beneficial ownership at the SeaSpine record date to obtain your admission ticket for the SeaSpine special meeting. A brokerage statement or account letter from a bank or broker are examples of proof of beneficial ownership. If you wish to vote your SeaSpine common stock held in “street name” in person at the SeaSpine special meeting, you will have to obtain a written legal proxy in your name from the bank, broker or other nominee holder of record that holds your shares. Please note that seating will be limited and requests for admission tickets will be accepted on a first-come, first-served basis. If you need special assistance at the SeaSpine special meeting because of a disability, please contact SeaSpine’s Corporate Secretary’s Office.

The enclosed joint proxy statement/prospectus provides a detailed description of the merger and the merger agreement and the other matters to be considered at the SeaSpine special meeting. We urge you to carefully read this joint proxy statement/prospectus, including any documents incorporated by reference herein, and the annexes in their entirety. If you have any questions concerning any of the proposals in this notice, the merger or the joint proxy statement/prospectus, would like additional copies or need help voting your shares of common stock, please contact SeaSpine’s proxy solicitor or SeaSpine:

 

LOGO

Strategic Shareholder Advisor and Proxy Solicitation Agent

745 Fifth Avenue, 5th Floor, New York, NY 10151

North American Toll Free Phone:

(855) 476-7861

Email: contactus@kingsdaleadvisors.com

Call Collect Outside North America: (917) 813-1235


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OR

SeaSpine Holdings Corporation

5770 Armada Drive

Carlsbad, California 92008

Attention: Investor Relations

Telephone: (610) 368-6505

E-mail: ir@seaspine.com

By Order of the SeaSpine Holdings Corporation Board of Directors,

 

LOGO

Patrick L. Keran

Senior Vice President,

General Counsel and Secretary

Carlsbad, California

November 22, 2022


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REFERENCES TO ADDITIONAL INFORMATION

The accompanying joint proxy statement/prospectus incorporates by reference important business and financial information about Orthofix and SeaSpine from other documents that are not included in or delivered with the accompanying joint proxy statement/prospectus. For a listing of the documents incorporated by reference into the accompanying joint proxy statement/prospectus, see “Where You Can Find More Information.”

You can obtain any of the documents incorporated by reference into the accompanying joint proxy statement/prospectus by requesting them in writing or by telephone as follows:

 

For Orthofix Stockholders:

Orthofix Medical Inc.

3451 Plano Parkway

Lewisville, Texas 75056

Attention: Investor Relations

(214) 937-3190

MergerInfo@Orthofix.com

  

For SeaSpine Stockholders:

SeaSpine Holdings Corporation

5770 Armada Drive

Carlsbad, California 92008

Attention: Investor Relations

(610) 368-6505

ir@seaspine.com

To receive timely delivery of the documents in advance of the Orthofix special meeting and the SeaSpine special meeting, you should make your request no later than December 19, 2022.

You may also obtain any of the documents incorporated by reference into the accompanying joint proxy statement/prospectus without charge through the Securities and Exchange Commission website at www.sec.gov. In addition, you may obtain copies of documents filed by Orthofix with the SEC on Orthofix’s Internet website at www.orthofix.com under the tab “Investors,” then under the tab “Financial Filings & Tax Documents” or by contacting Orthofix’s Senior Director of Investor Relations, Alexa Huerta, at 3451 Plano Parkway, Lewisville, Texas 75056 or by calling (214) 937-3190. You may also obtain copies of documents filed by SeaSpine with the SEC on SeaSpine’s Internet website at www.seaspine.com under the tab “Investor Relations” and then under the heading “SEC Filings” or by contacting SeaSpine Investor Relations at SeaSpine Holdings Corporation, Investor Relations, 5770 Armada Drive, Carlsbad, California 92008 or by calling (610) 368-6505.

We are not incorporating the contents of the websites of the SEC, Orthofix, SeaSpine or any other entity or any other website into the accompanying joint proxy statement/prospectus. We are providing the information about how you can obtain certain documents that are incorporated by reference into the accompanying joint proxy statement/prospectus at these websites only for your convenience.

 

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ABOUT THIS JOINT PROXY STATEMENT/PROSPECTUS

This joint proxy statement/prospectus, which forms part of a registration statement on Form S-4 filed with the SEC by Orthofix (File No. 333-268234), constitutes a prospectus of Orthofix under Section 5 of the Securities Act of 1933, as amended, with respect to the shares of common stock, par value $0.10 per share, of Orthofix to be issued to SeaSpine stockholders pursuant to the merger agreement. This document also constitutes a joint proxy statement of each of Orthofix and of SeaSpine under Section 14(a) of the Securities Exchange Act of 1934. It also constitutes a notice of meeting with respect to the SeaSpine special meeting, at which SeaSpine stockholders will be asked to consider and vote upon the SeaSpine merger proposal and certain other proposals, and it constitutes a notice of meeting with respect to the Orthofix special meeting, at which Orthofix stockholders will be asked to consider and vote upon the Orthofix share issuance proposal and certain other proposals.

You should rely only on the information contained in or incorporated by reference into this joint proxy statement/prospectus. Orthofix and SeaSpine have not authorized anyone to provide you with information that is different from that contained in or incorporated by reference into this joint proxy statement/prospectus. This joint proxy statement/prospectus is dated as of the date set forth above on the cover page of this joint proxy statement/prospectus, and you should not assume that the information contained in this joint proxy statement/prospectus is accurate as of any date other than such date. Further, you should not assume that the information incorporated by reference into this joint proxy statement/prospectus is accurate as of any date other than the date of the incorporated document. Neither the mailing of this joint proxy statement/prospectus to Orthofix stockholders or SeaSpine stockholders nor the issuance by Orthofix of shares of Orthofix common stock pursuant to the merger agreement will create any implication to the contrary.

This joint proxy statement/prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, or the solicitation of a proxy, in any jurisdiction in which or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction. Information contained in this joint proxy statement/prospectus regarding Orthofix and Orca Merger Sub Inc. has been provided by Orthofix and information contained in this joint proxy statement/prospectus regarding SeaSpine has been provided by SeaSpine.

Unless otherwise indicated or as the context otherwise requires, all references in this joint proxy statement/prospectus to:

 

   

“Code” refers to the Internal Revenue Code of 1986, as amended

 

   

“combined company” refers to Orthofix, following completion of the merger

 

   

“DGCL” refers to the General Corporation Law of the State of Delaware

 

   

“Exchange Act” refers to the Securities Exchange Act of 1934, as amended

 

   

“exchange ratio” refers to 0.4163 shares of Orthofix common stock per share of SeaSpine common stock

 

   

“excluded shares” refers to shares of SeaSpine common stock held by Orthofix, Merger Sub, any direct or indirect wholly owned subsidiary of SeaSpine or Orthofix or by SeaSpine as treasury stock

 

   

“GAAP” refers to accounting principles generally accepted in the United States

 

   

“HSR Act” refers to the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended

 

   

“IRS” refers to the Internal Revenue Service

 

   

“merger” refers to the merger of Merger Sub with and into SeaSpine, with SeaSpine being the surviving corporation in the merger

 

   

“merger agreement” refers to the Agreement and Plan of Merger, dated as of October 10, 2022, by and among Orthofix, Merger Sub and SeaSpine

 

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“merger consideration” refers to the right of SeaSpine stockholders to receive the exchange ratio

 

   

“Merger Sub” refers to Orca Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of Orthofix

 

   

“Nasdaq” refers to the Nasdaq Global Select Market

 

   

“Orthofix” refers to Orthofix Medical Inc., a Delaware corporation

 

   

“Orthofix adjournment proposal” refers to the proposal to adjourn the Orthofix special meeting to a later date or dates, if necessary or appropriate, to solicit additional proxies in the event there are not sufficient votes at the time of the Orthofix special meeting to approve the Orthofix share issuance proposal

 

   

“Orthofix Board” refers to the Orthofix board of directors

 

   

“Orthofix common stock” refers to the common stock of Orthofix, $0.10 par value per share

 

   

“Orthofix record date” refers to November 10, 2022

 

   

“Orthofix share issuance proposal” refers to the proposal that Orthofix stockholders approve the issuance of Orthofix common stock to SeaSpine stockholders in connection with the merger

 

   

“Orthofix stockholder” or “Orthofix stockholders” refers to one or more holders of Orthofix common stock, as applicable

 

   

“Orthofix stockholder approval” refers to the affirmative vote in favor of the Orthofix share issuance proposal of a majority in voting power of the shares of Orthofix common stock present in person or represented by proxy at the Orthofix special meeting and entitled to vote on the proposal

 

   

“Orthofix special meeting” refers to the special meeting of Orthofix stockholders to consider and vote upon the Orthofix share issuance proposal and related matters

 

   

“SeaSpine” refers to SeaSpine Holdings Corporation, a Delaware corporation

 

   

“SeaSpine adjournment proposal” refers to the proposal to adjourn the SeaSpine special meeting to a later date or dates, if necessary or appropriate, to solicit additional proxies in the event there are not sufficient votes at the time of the SeaSpine special meeting to approve the SeaSpine merger proposal

 

   

“SeaSpine Board” refers to the SeaSpine board of directors

 

   

“SeaSpine common stock” refers to the common stock of SeaSpine, $0.01 par value per share

 

   

“SeaSpine merger proposal” refers to the proposal that SeaSpine stockholders adopt the merger agreement

 

   

“SeaSpine merger-related compensation proposal” refers to the proposal that SeaSpine stockholders approve, by advisory (non-binding) vote, certain compensation arrangements that may be paid or become payable to SeaSpine’s named executive officers in connection with the merger contemplated by the merger agreement

 

   

“SeaSpine record date” refers to November 10, 2022

 

   

“SeaSpine restricted stock award” refers to an award of unvested restricted shares of SeaSpine common stock

 

   

“SeaSpine RSU award” refers to an award of time-based vesting restricted stock units relating to SeaSpine common stock

 

   

“SeaSpine stockholder” or “SeaSpine stockholders” refers to one or more holders of SeaSpine common stock, as applicable

 

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“SeaSpine stockholder approval” refers to the affirmative vote of the majority of the shares of SeaSpine common stock outstanding as of the SeaSpine record date and entitled to vote on the proposal

 

   

“SeaSpine special meeting” refers to the special meeting of SeaSpine stockholders to consider and vote upon the SeaSpine merger proposal and related matters

 

   

“SEC” refers to the Securities and Exchange Commission

 

   

“Securities Act” refers to the Securities Act of 1933, as amended

 

   

“we,” “our” and “us” refer to Orthofix and SeaSpine, collectively

 

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REFERENCES TO ADDITIONAL INFORMATION

     i  

ABOUT THIS JOINT PROXY STATEMENT/PROSPECTUS

     ii  

QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETINGS

     1  

SUMMARY

     13  

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF ORTHOFIX

     29  

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF SEASPINE

     31  

RISK FACTORS

     33  

Risks Related to the Merger

     33  

Risks Related to the Combined Company

     38  

Other Risk Factors

     41  

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

     42  

THE PARTIES TO THE MERGER

     44  

Orthofix Medical Inc.

     44  

SeaSpine Holdings Corporation

     44  

Orca Merger Sub Inc.

     45  

THE ORTHOFIX SPECIAL MEETING

     46  

Date, Time and Place

     46  

Purpose of the Orthofix Special Meeting

     46  

Recommendation of the Orthofix Board

     46  

Orthofix Record Date; Orthofix Stockholders Entitled to Vote

     46  

Voting by Orthofix’s Directors and Executive Officers

     47  

Quorum

     47  

Required Vote

     48  

Voting of Proxies by Holders of Record

     48  

Voting via the Internet or by Telephone

     48  

Voting by Mail

     48  

General

     48  

Treatment of Abstentions; Failure to Vote

     48  

Shares Held in Street Name

     49  

Attendance at the Orthofix Special Meeting and Voting in Person

     49  

Revocability of Proxies

     50  

Solicitation of Proxies; Expenses of Solicitation

     50  

Assistance

     50  

Tabulation of Votes

     51  

Adjournments

     51  

THE SEASPINE SPECIAL MEETING

     52  

Date, Time and Place

     52  

 

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     Page  

Purpose of the SeaSpine Special Meeting

     52  

Recommendation of the SeaSpine Board

     52  

SeaSpine Record Date; SeaSpine Stockholders Entitled to Vote

     52  

Voting by SeaSpine’s Directors and Executive Officers

     53  

Quorum

     53  

Required Vote

     54  

Voting of Proxies by Holders of Record

     54  

Voting via the Internet or by Telephone

     54  

Voting by Mail

     54  

General

     55  

Treatment of Abstentions; Failure to Vote

     55  

Shares Held in Street Name

     55  

Attendance at the SeaSpine Special Meeting and Voting in Person

     56  

Revocability of Proxies

     56  

Solicitation of Proxies; Expenses of Solicitation

     57  

Assistance

     57  

Tabulation of Votes

     57  

Adjournments

     57  

SEASPINE PROPOSAL I: ADOPTION OF THE MERGER AGREEMENT AND ORTHOFIX PROPOSAL I: APPROVAL OF THE SHARE ISSUANCE

     59  

Background of the Merger

     59  

Orthofix Board’s Recommendation and Reasons for the Merger

     75  

SeaSpine Board’s Recommendation and Reasons for the Merger

     81  

Opinion of Orthofix’s Financial Advisor

     83  

Opinion of SeaSpine’s Financial Advisor

     91  

Certain Unaudited Prospective Financial Information

     105  

Governance of the Combined Company

     110  

Treatment of Indebtedness

     111  

Litigation Related to the Merger

     112  

Regulatory Approvals

     112  

Timing of the Merger

     112  

Director and Officer Indemnification

     113  

No Appraisal Rights in the Merger

     113  

Material U.S. Federal Income Tax Consequences of the Merger

     113  

Accounting Treatment

     116  

Nasdaq Listing; Delisting and Deregistration of SeaSpine Common Stock

     116  

THE MERGER AGREEMENT

     117  

Explanatory Note Regarding the Merger Agreement

     117  

Structure of the Merger

     117  

 

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     Page  

Merger Consideration

     117  

Treatment of SeaSpine Equity Awards

     118  

Closing and Effectiveness of the Merger

     119  

Conversion of Shares; Exchange of Certificates

     119  

Governance of the Combined Company

     120  

Representations and Warranties; Material Adverse Effect

     122  

Covenants and Agreements

     124  

Conditions to the Merger

     134  

Termination

     135  

Expenses and Termination Fees

     136  

Amendment and Waiver

     137  

Third-Party Beneficiaries

     138  

Governing Law; Waiver of Jury Trial

     138  

Enforcement

     138  

INTERESTS OF ORTHOFIX’S DIRECTORS AND EXECUTIVE OFFICERS IN THE MERGER

     139  

INTERESTS OF SEASPINE’S DIRECTORS AND EXECUTIVE OFFICERS IN THE MERGER

     145  

SEASPINE PROPOSAL II: ADVISORY VOTE ON MERGER-RELATED COMPENSATION

     150  

SEASPINE PROPOSAL III: ADJOURNMENT OF THE SEASPINE SPECIAL MEETING

     151  

ORTHOFIX PROPOSAL II: ADJOURNMENT OF THE ORTHOFIX SPECIAL MEETING

     152  

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

     153  

ORTHOFIX BENEFICIAL OWNERSHIP TABLE

     167  

SEASPINE BENEFICIAL OWNERSHIP TABLE

     169  

DESCRIPTION OF CAPITAL STOCK OF ORTHOFIX

     171  

COMPARISON OF THE RIGHTS OF ORTHOFIX STOCKHOLDERS AND SEASPINE STOCKHOLDERS

     174  

LEGAL MATTERS

     188  

EXPERTS

     188  

ORTHOFIX STOCKHOLDER PROPOSALS

     189  

SEASPINE STOCKHOLDER PROPOSALS

     190  

HOUSEHOLDING OF PROXY MATERIALS

     191  

WHERE YOU CAN FIND MORE INFORMATION

     192  

ANNEX A—AGREEMENT AND PLAN OF MERGER

ANNEX B—OPINION OF PERELLA WEINBERG PARTNERS L.P.

ANNEX C—OPINION OF PIPER SANDLER & CO.

 

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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETINGS

The following questions and answers briefly address some commonly asked questions about the merger, the merger agreement, the transactions contemplated by the merger agreement, the Orthofix special meeting and the SeaSpine special meeting. They may not include all the information that is important to Orthofix stockholders and SeaSpine stockholders. Orthofix stockholders and SeaSpine stockholders should carefully read this entire joint proxy statement/prospectus, including the annexes and the other documents referred to or incorporated by reference herein.

 

Q:

What is the merger?

 

A:

Orthofix, Merger Sub and SeaSpine have entered into a merger agreement. A copy of the merger agreement is attached as Annex A to this joint proxy statement/prospectus. The merger agreement contains the terms and conditions of the proposed merger between Orthofix and SeaSpine, whereby the Orthofix and SeaSpine businesses will combine in an all-stock merger of equals. Under the merger agreement, subject to satisfaction or (to the extent permitted by law) waiver of the conditions set forth in the merger agreement and described hereafter, in each case prior to the completion of the merger, Merger Sub, a wholly owned subsidiary of Orthofix, will merge with and into SeaSpine, with SeaSpine continuing as the surviving corporation and a wholly owned subsidiary of Orthofix. As a result of the merger, SeaSpine will no longer be a publicly-held company. Following the merger, SeaSpine common stock will be delisted from Nasdaq and deregistered under the Exchange Act. The parties expect to rename Orthofix (as the parent entity in the combined company structure) prior to the transaction’s closing. Each of the common stock of Orthofix and the common stock of SeaSpine is traded on Nasdaq under the symbols “OFIX” and “SPNE,” respectively. Orthofix intends to file an initial listing application for the combined company with the Nasdaq, which will reflect any revision to the combined company’s trading symbol.

 

Q:

Why am I receiving these materials?

 

A:

You are receiving this joint proxy statement/prospectus to help you decide how to vote your shares of Orthofix common stock or SeaSpine common stock with respect to the Orthofix share issuance proposal or the SeaSpine merger proposal, respectively, and other matters to be considered at the special meetings.

The merger cannot be completed unless, among other things, (1) Orthofix stockholders approve the issuance of Orthofix common stock to SeaSpine stockholders in connection with the merger at the Orthofix special meeting and (2) SeaSpine stockholders adopt the merger agreement at the SeaSpine special meeting.

This joint proxy statement/prospectus constitutes both a joint proxy statement of Orthofix and SeaSpine and a prospectus of Orthofix. It is a joint proxy statement because each of the Orthofix Board and the SeaSpine Board is soliciting proxies from its respective stockholders. It is a prospectus because Orthofix will issue shares of its common stock in exchange for outstanding shares of SeaSpine common stock in the merger. Information about the Orthofix special meeting, the SeaSpine special meeting, the merger, the merger agreement and the other business to be considered by Orthofix stockholders at the Orthofix special meeting and SeaSpine stockholders at the SeaSpine special meeting is contained in this joint proxy statement/prospectus. Orthofix stockholders and SeaSpine stockholders should read this information carefully and in its entirety. The enclosed voting materials allow Orthofix stockholders and SeaSpine stockholders to vote their shares by proxy without attending the applicable special meeting in person.

 

Q:

What will SeaSpine stockholders receive in the merger?

 

A:

If the merger is completed, each share of SeaSpine common stock (other than excluded shares) will be converted into the merger consideration, which is the right to receive 0.4163 fully paid and nonassessable shares of Orthofix common stock, and, if applicable, cash in lieu of fractional shares. The merger consideration is described in more detail in “The Merger Agreement — Merger Consideration.”

 

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Q:

What will Orthofix stockholders receive in the merger?

 

A:

Orthofix stockholders will not receive any merger consideration, and their shares of Orthofix common stock will remain outstanding as shares of the combined company.

 

Q:

How will Orthofix stockholders be affected by the Merger and the issuance of Orthofix common shares to SeaSpine stockholders in the Merger?

 

A:

After the merger, each Orthofix stockholder will continue to own the shares of Orthofix common stock that such stockholder held immediately prior to the merger. As a result, each Orthofix stockholder will continue to own common shares in the combined company, which will be a larger company. However, because Orthofix will be issuing new shares of Orthofix common stock to stockholders of SeaSpine in the merger, each outstanding share of Orthofix common stock immediately prior to the merger will represent a smaller percentage of the aggregate number of shares of Orthofix common stock outstanding after the merger.

Upon completion of the merger, pre-merger holders of Orthofix common stock will own approximately 56.5%, and former holders of SeaSpine common stock will own approximately 43.5% of the outstanding common stock on a diluted basis (calculated using the treasury stock method). The exact equity stake of Orthofix stockholders and SeaSpine stockholders in the combined company immediately following the merger will depend on the number of shares of Orthofix common stock and SeaSpine common stock issued and outstanding immediately prior to the merger.

 

Q:

Will my rights as a stockholder change as a result of the Merger?

 

A:

The rights of the Orthofix stockholders will be substantially unchanged as a result of the merger. SeaSpine stockholders will have different rights following the effective time due to the differences between the governing documents of Orthofix and SeaSpine. For more information regarding the differences in stockholder rights, see “Comparison of the Rights of Orthofix Stockholders and SeaSpine Stockholders.”

 

Q:

What respective equity stakes will Orthofix stockholders and SeaSpine stockholders hold in the combined company immediately following the merger?

 

A:

As of the date of this joint proxy statement/prospectus, based on the current number of shares of Orthofix common stock and SeaSpine common stock outstanding and reserved for issuance, we estimate that, immediately following completion of the merger, pre-merger holders of Orthofix common stock will own approximately 56.5%, and former holders of SeaSpine common stock will own approximately 43.5%, of the outstanding common stock on a diluted basis (calculated using the treasury stock method). The exact equity stake of Orthofix stockholders and SeaSpine stockholders in the combined company immediately following the merger will depend on the number of shares of Orthofix common stock and SeaSpine common stock issued and outstanding immediately prior to the merger.

 

Q:

Will the market value of the merger consideration change between the date of this joint proxy statement/prospectus and the time the merger is completed?

 

A:

Yes. Although the number of shares of Orthofix common stock that holders of SeaSpine common stock will receive in the merger is fixed, the market value of the merger consideration will fluctuate between the date of this joint proxy statement/prospectus and the completion of the merger based upon the trading price of shares of Orthofix common stock. Any fluctuation in the trading price of shares of Orthofix common stock after the date of this joint proxy statement/prospectus will change the market value of the shares of Orthofix common stock that holders of SeaSpine common stock will receive.

 

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Q:

When do Orthofix and SeaSpine expect to complete the transaction?

 

A:

Orthofix and SeaSpine are working to complete the transaction as soon as practicable. We currently expect that the merger will be completed in the first quarter of 2023. Neither Orthofix nor SeaSpine can predict, however, the actual date on which the merger will be completed because it is subject to conditions beyond each company’s control, including obtaining the necessary regulatory approvals. See “The Merger Agreement — Conditions to the Merger.”

 

Q:

What matters will be considered at each of the special meetings?

 

A:

Orthofix stockholders are being asked to vote on the following proposals:

 

  1.

Approval of the Orthofix Share Issuance. To vote on a proposal to approve the issuance of Orthofix common stock, par value $0.10 per share, to SeaSpine stockholders in connection with the merger, referred to as the Orthofix share issuance proposal; and

 

  2.

Adjournment of the Orthofix Special Meeting. To vote on a proposal to approve the adjournment of the Orthofix special meeting to a later date or dates, if necessary or appropriate, to solicit additional proxies in the event there are not sufficient votes at the time of the Orthofix special meeting to approve the Orthofix share issuance proposal, referred to as the Orthofix adjournment proposal.

SeaSpine stockholders are being asked to vote on the following proposals:

 

  1.

Adoption of the Merger Agreement. To vote on a proposal to adopt the merger agreement, which is further described in the section entitled “The Merger Agreement,” and a copy of which merger agreement is attached as Annex A to this joint proxy statement/prospectus, referred to as the SeaSpine merger proposal;

 

  2.

SeaSpine Merger-Related Compensation. To vote on a proposal to approve, by advisory (non-binding) vote, certain compensation arrangements that may be paid or become payable to SeaSpine’s named executive officers in connection with the merger contemplated by the merger agreement, referred to as the SeaSpine merger-related compensation proposal; and

 

  3.

Adjournment of the SeaSpine Special Meeting. To vote on a proposal to approve the adjournment of the SeaSpine special meeting to a later date or dates, if necessary or appropriate, to solicit additional proxies in the event there are not sufficient votes at the time of the SeaSpine special meeting to approve the SeaSpine merger proposal, referred to as the SeaSpine adjournment proposal.

Approval of the Orthofix share issuance proposal by Orthofix stockholders and approval of the SeaSpine merger proposal by SeaSpine stockholders are required for completion of the merger.

 

Q:

What vote is required to approve each proposal at the Orthofix special meeting?

 

A:

The Orthofix share issuance proposal: The affirmative vote at the Orthofix special meeting of a majority in voting power of the shares of Orthofix common stock present in person or represented by proxy and entitled to vote on the proposal is required to approve the Orthofix share issuance proposal.

The Orthofix adjournment proposal: The affirmative vote at the Orthofix special meeting of a majority in voting power of the shares of Orthofix common stock present in person or represented by proxy and entitled to vote on the proposal is required to approve the Orthofix adjournment proposal.

 

Q:

What vote is required to approve each proposal at the SeaSpine special meeting?

 

A:

The SeaSpine merger proposal: The affirmative vote at the SeaSpine special meeting of holders of a majority of the shares of SeaSpine common stock outstanding and entitled to vote on the proposal as of the SeaSpine record date is required to approve the SeaSpine merger proposal.

 

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The SeaSpine merger-related compensation proposal: The affirmative vote at the SeaSpine special meeting of the holders of a majority of the voting power of the shares of SeaSpine common stock entitled to vote on the proposal represented in person or by proxy is required to approve the SeaSpine merger-related compensation proposal.

The SeaSpine adjournment proposal: The affirmative vote at the SeaSpine special meeting of the holders of a majority of the voting power of the shares of SeaSpine common stock entitled to vote on the proposal represented in person or by proxy is required to approve the SeaSpine adjournment proposal.

 

Q:

Why are SeaSpine stockholders being asked to consider and vote on a proposal to approve, by advisory (non-binding) vote, the SeaSpine merger-related executive compensation?

 

A:

Under SEC rules, SeaSpine is required to seek an advisory (non-binding) vote with respect to the compensation that may be paid or become payable to its named executive officers that is based on, or otherwise relates to, the merger.

Q: What happens if the SeaSpine merger-related compensation proposal is not approved?

 

A:

Approval of the SeaSpine merger-related compensation proposal is not a condition to completion of the merger, and because the vote on the SeaSpine merger-related compensation proposal is advisory only, it will not be binding on SeaSpine. Accordingly, if the SeaSpine merger proposal is approved and the other conditions to closing are satisfied or waived, the merger will be completed even if the SeaSpine merger-related compensation proposal is not approved. If the SeaSpine merger proposal is approved and the Orthofix share issuance proposal is approved and the merger is completed, the SeaSpine merger-related compensation will be payable to SeaSpine’s named executive officers, subject only to the conditions applicable thereto, regardless of the outcome of the vote on the SeaSpine merger-related compensation proposal.

 

Q:

Do any of Orthofix’s or SeaSpine’s directors or executive officers have interests in the merger that may differ from those of Orthofix stockholders or SeaSpine stockholders?

 

A:

Certain of Orthofix’s non-employee directors and executive officers, and SeaSpine’s non-employee directors and executive officers, have certain interests in the merger that may be different from, or in addition to, the interests of Orthofix stockholders and SeaSpine stockholders generally. The Orthofix Board was aware of the interests of Orthofix’s directors and executive officers, the SeaSpine Board was aware of the interests of SeaSpine’s directors and executive officers, and each board considered such interests, among other matters, when it approved the merger agreement and in making its recommendations to its stockholders. For more information regarding these interests, see the sections entitled “Interests of Orthofix’s Directors and Executive Officers in the Merger” and “Interests of SeaSpine’s Directors and Executive Officers in the Merger.”

 

Q:

How many votes do I have?

 

A:

Each Orthofix stockholder is entitled to one vote for each share of Orthofix common stock held of record as of the Orthofix record date and each SeaSpine stockholder is entitled to one vote for each share of SeaSpine common stock held of record as of the SeaSpine record date.

As of the close of business on the Orthofix record date, there were 20,011,598 shares of Orthofix common stock outstanding. As of the close of business on the SeaSpine record date, there were 37,755,164 shares of SeaSpine common stock outstanding. As summarized below, there are some important distinctions between shares held of record and those owned beneficially in street name.

 

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Q:

What constitutes a quorum for the Orthofix special meeting?

 

A:

The presence at the Orthofix special meeting, in person or represented by proxy, of holders of a majority of the aggregate voting power of the Orthofix common stock outstanding and entitled to vote at the meeting as of the Orthofix record date constitutes a quorum for the transaction of business at the Orthofix special meeting. Abstentions (which are described below) will count for the purpose of determining the presence of a quorum for the transaction of business at the Orthofix special meeting.

 

Q:

What constitutes a quorum for the SeaSpine special meeting?

 

A:

The presence at the SeaSpine special meeting, in person or by proxy, of holders representing a majority in voting power of the shares of the SeaSpine common stock outstanding and entitled to vote at the meeting as of the SeaSpine record date constitutes a quorum for the transaction of business at the SeaSpine special meeting. Abstentions (which are described below) will count for the purpose of determining the presence of a quorum for the transaction of business at the SeaSpine special meeting.

 

Q:

How does the Orthofix Board recommend that Orthofix stockholders vote?

 

A:

The Orthofix Board unanimously recommends that Orthofix stockholders vote: “FOR” the Orthofix share issuance proposal and “FOR” the Orthofix adjournment proposal.

 

Q:

How does the SeaSpine Board recommend that SeaSpine stockholders vote?

 

A:

The SeaSpine Board unanimously recommends that SeaSpine stockholders vote: “FOR” the SeaSpine merger proposal, “FOR” the SeaSpine merger-related compensation proposal and “FOR” the SeaSpine adjournment proposal.

 

Q:

Why did the Orthofix Board approve the merger agreement and the transactions contemplated by the merger agreement, including the merger?

 

A:

For information regarding the Orthofix Board’s reasons for approving the merger agreement and the transactions contemplated by the merger agreement, including the merger, and recommending that Orthofix stockholders approve the Orthofix share issuance proposal, see the section entitled “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — Orthofix Board’s Recommendation and Reasons for the Merger.”

 

Q:

Why did the SeaSpine Board approve the merger agreement and the transactions contemplated by the merger agreement, including the merger?

 

A:

For information regarding the SeaSpine Board’s reasons for approving and recommending adoption of the merger agreement and the transactions contemplated by the merger agreement, including the merger, see the section entitled “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — SeaSpine Board’s Recommendation and Reasons for the Merger.”

 

Q:

What if I hold shares in both Orthofix and SeaSpine?

 

A:

If you hold shares of both Orthofix common stock and SeaSpine common stock, you will receive two separate packages of proxy materials. A vote cast as a holder of Orthofix common stock will not count as a vote cast as a holder of SeaSpine common stock, and a vote cast as a holder of SeaSpine common stock will not count as a vote cast as a holder of Orthofix common stock. Therefore, please submit separate proxies for your shares of Orthofix common stock and your shares of SeaSpine common stock.

 

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Q:

What do I need to do now?

 

A:

After carefully reading and considering the information contained in this joint proxy statement/prospectus, please vote your shares as soon as possible so that your shares will be represented at the Orthofix special meeting or SeaSpine special meeting, as applicable. Please follow the instructions set forth on the Orthofix proxy card or the SeaSpine proxy card, as applicable, or on the voting instruction form provided by the record holder if your shares are held in the name of your bank, broker or other nominee.

If you are a SeaSpine stockholder, please do not submit your stock certificates at this time. If the merger is completed, you will receive instructions for surrendering your stock certificates in exchange for shares of Orthofix common stock from the exchange agent.

 

Q:

Does my vote matter?

 

A:

Yes. The merger cannot be completed unless (i) the Orthofix share issuance proposal is approved by the affirmative vote of a majority in voting power of the shares of Orthofix common stock present in person or represented by proxy at the Orthofix special meeting and entitled to vote on the proposal and (ii) the SeaSpine merger proposal is approved by the affirmative vote at the SeaSpine special meeting of the holders of a majority of the shares of SeaSpine common stock outstanding as of the SeaSpine record date and entitled to vote on the proposal.

 

Q:

How do I vote?

 

A:

If you are a stockholder of record of Orthofix as of the Orthofix record date of November 10, 2022, you are entitled to receive notice of, and cast a vote at, the Orthofix special meeting. If you are a stockholder of record of SeaSpine as of November 10, 2022, the SeaSpine record date, you are entitled to receive notice of, and cast a vote at, the SeaSpine special meeting. Each holder of Orthofix common stock is entitled to cast one vote on each matter properly brought before the Orthofix special meeting for each share of Orthofix common stock that such holder owned of record as of the Orthofix record date. Each holder of SeaSpine common stock is entitled to cast one vote on each matter properly brought before the SeaSpine special meeting for each share of SeaSpine common stock that such holder owned of record as of the SeaSpine record date. You may submit your proxy before the Orthofix special meeting or the SeaSpine special meeting in one of the following ways:

 

   

Telephone voting — use the toll-free number shown on your proxy card;

 

   

Via the Internet — visit the website shown on your proxy card to vote via the Internet; or

 

   

Mail — complete, sign, date and return the enclosed proxy card in the enclosed postage-paid envelope.

If you are a stockholder of record, you may also cast your vote in person at the applicable special meeting.

If your shares are held in “street name,” through a bank, broker or other nominee, that institution will send you separate instructions describing the procedure for voting your shares. “Street name” stockholders or stockholders who wish to vote at the Orthofix special meeting or the SeaSpine special meeting will need to obtain a “legal proxy” form from their bank, broker or other nominee.

 

Q:

What is the difference between holding shares as a stockholder of record and as a beneficial owner?

 

A:

You are a “stockholder of record” if your shares are registered directly in your name with Orthofix’s transfer agent, Computershare Trust Company, N.A., referred to as Computershare, or SeaSpine’s transfer agent, American Stock Transfer & Trust Company, LLC, referred to as AST, as applicable. As the stockholder of record, you have the right to vote in person at the Orthofix special meeting or the SeaSpine special meeting, as applicable. You may also vote by Internet, telephone or mail, as described in the notice and above under the heading “How do I vote?” You are deemed to beneficially own shares in “street name”

 

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  if your shares are held by a bank, broker or other nominee. Your bank, broker or other nominee will send you, as the beneficial owner, a package describing the procedure for voting your shares. You should follow the instructions provided by them to vote your shares. If you beneficially own your shares, you are invited to attend the Orthofix special meeting or SeaSpine special meeting, as applicable; however, you may not vote your shares in person at the Orthofix special meeting or the SeaSpine special meeting, as applicable, unless you obtain a “legal proxy” from your bank, broker or other nominee that holds your shares, giving you the right to vote the shares at the Orthofix special meeting or the SeaSpine special meeting, as applicable.

 

Q:

If my shares are held in “street name” by a bank, broker or other nominee, will my bank, broker or other nominee vote my shares for me?

 

A:

If your shares are held in “street name” by a bank, broker or other nominee, you must provide the record holder of your shares with instructions on how to vote your shares. Please follow the voting instructions provided by your bank, broker or other nominee. Please note that you may not vote shares held in street name by returning a proxy card directly to Orthofix or SeaSpine, as applicable, or by voting in person at the Orthofix special meeting or SeaSpine special meeting, as applicable, unless you provide a “legal proxy,” which you must obtain from your bank, broker or other nominee. Your bank, broker or other nominee is obligated to provide you with a voting instruction card for you to use.

Banks, brokers or other nominees who hold shares in street name for a beneficial owner of those shares typically have the authority to vote in their discretion on “routine” proposals when they have not received instructions from beneficial owners. However, banks, brokers or other nominees are not allowed to exercise their voting discretion with respect to the approval of matters determined to be “non-routine” without specific instructions from the beneficial owner. It is expected that all proposals to be voted on at each of the Orthofix special meeting and the SeaSpine special meeting are “non-routine” matters. Broker non-votes occur when a broker or nominee is not instructed by the beneficial owner of shares to vote on a particular proposal for which the bank, broker or other nominee does not have discretionary voting power.

If you are a beneficial owner of Orthofix shares and you do not instruct your bank, broker or other nominee on how to vote your shares:

 

   

your bank, broker or other nominee may not vote your shares on the Orthofix share issuance proposal, which broker non-votes, if any, will have no effect on the outcome of such proposal; and

 

   

your bank, broker or other nominee may not vote your shares on the Orthofix adjournment proposal, which broker non-votes, if any, will have no effect on the outcome of such proposal.

If you are a beneficial owner of SeaSpine shares and you do not instruct your bank, broker or other nominee on how to vote your shares:

 

   

your bank, broker or other nominee may not vote your shares on the SeaSpine merger proposal, which broker non-votes, if any, will have the same effect as a vote “AGAINST” such proposal;

 

   

your bank, broker or other nominee may not vote your shares on the SeaSpine merger-related compensation proposal, which broker non-votes, if any, will have no effect on the outcome of such proposal; and

 

   

your bank, broker or other nominee may not vote your shares on the SeaSpine adjournment proposal, which broker non-votes, if any, will have no effect on the outcome of such proposal.

 

Q:

May I attend the Orthofix special meeting or the SeaSpine special meeting in person?

 

A:

You or your authorized proxy may attend the Orthofix special meeting in person if you were a record or beneficial stockholder of Orthofix common stock as of the Orthofix record date.

You or your authorized proxy may attend the SeaSpine special meeting in person if you were a record or beneficial stockholder of SeaSpine common stock as of the SeaSpine record date.

 

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Q:

When and where will each of the Orthofix special meeting and SeaSpine special meeting take place? What must I bring to attend the Orthofix special meeting or the SeaSpine special meeting?

 

A:

The Orthofix special meeting will be held at Hampton Inn & Suites, 3650 Plano Pkwy, The Colony, TX 75056 on January 4, 2023, at 11 a.m. Central Time. You will need to obtain an admission ticket in advance to attend the Orthofix special meeting. To do so, please make your request by mail to Orthofix Investor Relations, 3451 Plano Parkway, Lewisville, Texas 75056, or by email at MergerInfo@Orthofix.com. Orthofix must receive your request for an admission ticket on or before 11:59 p.m. Central Time on January 2, 2023. Seating will be limited and requests for tickets will be processed in the order in which they are received.

If you own shares in “street name” through an account with a bank, broker or other nominee, then send proof of your Orthofix share ownership as of the Orthofix record date (for example, a brokerage firm account statement or a “legal proxy” from your intermediary) along with your ticket request. If you are not sure what proof to send, check with your intermediary.

If your shares are registered in your name with Orthofix’s stock registrar and transfer agent, Computershare, no proof of ownership is required because Orthofix can verify your ownership.

For security reasons, be prepared to show a form of government-issued photo identification when presenting your ticket for admission to the Orthofix special meeting. If you forget to bring your ticket, you will be admitted only if you provide photo identification. If you do not request a ticket in advance, you will be admitted only if space is available and you provide photo identification and satisfactory evidence that you were a stockholder of Orthofix common stock as of the Orthofix record date. If you need special assistance at the Orthofix special meeting because of a disability, please contact Orthofix Investor Relations.

The SeaSpine special meeting will be held at the offices of DLA Piper LLP (US), 4365 Executive Drive, 4th Floor, San Diego, CA 92121 on January 4, 2023 at 9 a.m. Pacific Time. Subject to space availability, all SeaSpine stockholders as of the SeaSpine record date, or their duly appointed proxies, may attend the SeaSpine special meeting. If you received your special meeting materials electronically and wish to attend the SeaSpine special meeting, please follow the instructions provided for attendance. If you need special assistance at the SeaSpine special meeting because of a disability, please contact SeaSpine’s Corporate Secretary.

If you hold shares in your name on the SeaSpine record date and wish to attend the SeaSpine special meeting, because of security procedures, you will need to obtain an admission ticket in advance. In addition to obtaining an admission ticket in advance, you will be required to provide valid government-issued photo identification to be admitted to the SeaSpine special meeting. Admission tickets will be available to both registered and beneficial owners of SeaSpine common stock. You may apply for an admission ticket by mail to Office of the Corporate Secretary, 5770 Armada Drive, Carlsbad, California 92008. SeaSpine’s Corporate Secretary must receive your request for an admission ticket on or before 11:59 p.m. Eastern Time on January 2, 2023. If you are a beneficial owner of SeaSpine common stock and hold your shares through a bank, broker or other nominee and you plan to attend the SeaSpine special meeting in person, in addition to following the procedures described above, you will also need to provide proof of beneficial ownership at the SeaSpine record date to obtain your admission ticket for the SeaSpine special meeting. A brokerage statement or account letter from a bank or broker are examples of proof of beneficial ownership. If you wish to vote your SeaSpine common stock held in “street name” in person at the SeaSpine special meeting, you will have to obtain a written legal proxy in your name from the bank, broker or other nominee holder of record that holds your shares. SeaSpine stockholders may contact SeaSpine Investor Relations Department at (610) 368-6505 or Kingsdale Advisors at (917) 813-1235 or contactus@kingsdaleadvisors.com to obtain directions to the location of the SeaSpine special meeting. Please note that seating will be limited and requests for admission tickets will be accepted on a first-come, first-served basis.

 

Q:

What if I fail to vote or abstain?

 

A:

For purposes of the Orthofix special meeting, an abstention occurs when an Orthofix stockholder attends the Orthofix special meeting in person and does not vote or returns a proxy with an “abstain” instruction.

 

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Orthofix share issuance proposal: An abstention will have the same effect as a vote cast “AGAINST” the Orthofix share issuance proposal. If an Orthofix stockholder is not present in person at the Orthofix special meeting and does not respond by proxy, it will have no effect on the vote count for such proposal.

Orthofix adjournment proposal: An abstention will have the same effect as a vote cast “AGAINST” the Orthofix adjournment proposal. If an Orthofix stockholder is not present in person at the Orthofix special meeting and does not respond by proxy, it will have no effect on the vote count for such proposal.

For purposes of the SeaSpine special meeting, an abstention occurs when a SeaSpine stockholder attends the SeaSpine special meeting in person and does not vote or returns a proxy with an “abstain” instruction.

SeaSpine merger proposal: An abstention will have the same effect as a vote cast “AGAINST” the SeaSpine merger proposal. If a SeaSpine stockholder is not present in person at the SeaSpine special meeting and does not respond by proxy, it will have the same effect of a vote cast “AGAINST” such proposal.

SeaSpine merger-related compensation proposal: An abstention will have the same effect as a vote cast “AGAINST” the SeaSpine merger-related compensation proposal. If a SeaSpine stockholder is not present in person at the SeaSpine special meeting and does not respond by proxy, it will have no effect on the outcome of the merger-related compensation proposal.

SeaSpine adjournment proposal: An abstention will have the same effect as a vote cast “AGAINST” the SeaSpine adjournment proposal. If a SeaSpine stockholder is not present in person at the SeaSpine special meeting and does not respond by proxy, it will have no effect on the vote count for such proposal.

 

Q:

What will happen if I return my proxy or voting instruction card without indicating how to vote?

 

A:

If you sign and return your proxy or voting instruction card without indicating how to vote on any particular proposal, the common stock represented by your proxy will be voted as recommended by the Orthofix Board or the SeaSpine Board, as applicable, with respect to that proposal.

 

Q:

May I change or revoke my vote after I have delivered my proxy or voting instruction card?

 

A:

Yes. If you are a record holder, you may change or revoke your vote before your proxy is voted at the Orthofix special meeting or the SeaSpine special meeting, as applicable, as described herein. You may do this in one of the following four ways:

 

   

by logging onto the Internet website specified on your proxy card in the same manner you would to submit your proxy electronically or by calling the telephone number specified on your proxy card, in each case, if you are eligible to do so;

 

   

by sending a notice of revocation to the corporate secretary of Orthofix or SeaSpine, as applicable;

 

   

by sending a completed proxy card bearing a later date than your original proxy card; or

 

   

by attending the Orthofix special meeting or the SeaSpine special meeting, as applicable, and voting in person.

If you choose any of the first three methods, you must take the described action no later than the beginning of the Orthofix special meeting or the SeaSpine special meeting, as applicable.

If your shares are held in an account at a bank, broker or other nominee and you have delivered your voting instruction card or otherwise given instruction on how to vote your shares to your bank, broker or other nominee or your applicable plan administrator, you should contact your bank, broker or other nominee or your applicable plan administrator to change your vote.

 

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Q:

What are the material U.S. federal income tax consequences of the merger?

 

A:

It is a condition to SeaSpine’s obligation to complete the merger that SeaSpine receive an opinion of its outside counsel to the effect that the merger will qualify as a “reorganization” within the meaning of Section 368(a) of the Code. Accordingly, it is expected that U.S. holders of shares of SeaSpine common stock generally will not recognize any gain or loss for U.S. federal income tax purposes upon receipt of Orthofix common stock in exchange for SeaSpine common stock in the merger (other than gain or loss, if any, with respect to any cash received in lieu of a fractional share of Orthofix common stock).

SeaSpine stockholders should consult their own tax advisors as to the particular consequences of the merger, including the applicability and effect of any U.S. federal, state and local tax laws, as well as foreign tax laws. For more information regarding the material U.S. federal income tax consequences of the merger, see “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — Material U.S. Federal Income Tax Consequences of the Merger.”

 

Q:

Where can I find the voting results of the Orthofix special meeting and the SeaSpine special meeting?

 

A:

The preliminary voting results will be announced at each of the Orthofix special meeting and the SeaSpine special meeting. In addition, within four business days following certification of the final voting results, each of Orthofix and SeaSpine intends to file the final voting results with the SEC on a Current Report on Form 8-K.

 

Q:

Are holders of Orthofix common stock entitled to appraisal rights?

 

A:

No. Holders of Orthofix common stock are not entitled to appraisal rights under the DGCL with respect to the merger. For more information, see the section entitled “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — No Appraisal Rights in the Merger.”

 

Q:

Are holders of SeaSpine common stock entitled to appraisal rights?

 

A:

No. Holders of SeaSpine common stock are not entitled to appraisal rights under the DGCL with respect to the merger. For more information, see the section entitled “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — No Appraisal Rights in the Merger.”

 

Q:

What happens if I sell my shares of Orthofix common stock after the Orthofix record date but before the Orthofix special meeting?

 

A:

The Orthofix record date for the Orthofix special meeting (the close of business on November 10, 2022) is earlier than the date of the Orthofix special meeting and earlier than the date that the merger is expected to be completed. If you sell or otherwise transfer your shares of Orthofix common stock after the Orthofix record date but before the date of the Orthofix special meeting, you will retain your right to vote at the Orthofix special meeting.

 

Q:

What happens if I sell my shares of SeaSpine common stock after the SeaSpine record date but before the SeaSpine special meeting?

 

A:

The SeaSpine record date for the SeaSpine special meeting (the close of business on November 10, 2022) is earlier than the date of the SeaSpine special meeting and earlier than the date that the merger is expected to be completed. If you sell or otherwise transfer your shares of SeaSpine common stock after the SeaSpine record date but before the date of the SeaSpine special meeting, you will retain your right to vote at the SeaSpine special meeting. However, you will not have the right to receive the merger consideration to be received by SeaSpine stockholders in the merger. In order to receive the merger consideration, you must hold your shares through completion of the merger.

 

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Q:

Are there any risks that I should consider in deciding whether to vote in favor of the Orthofix share issuance proposal or the SeaSpine merger proposal, or the other proposals to be considered at the Orthofix special meeting or the SeaSpine special meeting, as applicable?

 

A:

Yes. You should read and carefully consider the risk factors set forth in the section entitled “Risk Factors” beginning on page 33. You also should read and carefully consider the risk factors of Orthofix and SeaSpine contained in the documents that are incorporated by reference into this joint proxy statement/prospectus.

 

Q:

What are the conditions to completion of the merger?

 

A:

In addition to the approval of the Orthofix share issuance proposal by Orthofix stockholders and of the SeaSpine merger proposal by SeaSpine stockholders as described above, completion of the merger is subject to the satisfaction or (to the extent permitted by law) waiver of a number of other conditions, including:

 

   

the registration statement on Form S-4, of which this joint proxy statement/prospectus forms a part, becoming effective under the Securities Act, and no stop order having been issued;

 

   

the expiration or termination of any applicable waiting period (and any extension thereof) under the HSR Act, and the expiration of any mandatory waiting period or the receipt of any required consent under any other applicable antitrust laws except for such waiting periods or consents that are not reasonably expected to delay or prevent the completion of the merger or have a material adverse effect on the expected benefits of the merger to SeaSpine and Orthofix, taken as a whole;

 

   

approval of the listing on Nasdaq of the shares of Orthofix common stock issued or issuable pursuant to the merger agreement;

 

   

the absence of an injunction or law prohibiting the merger;

 

   

receipt by SeaSpine of an opinion of its respective outside counsel to the effect that the merger will qualify as a “reorganization” within the meaning of Section 368(a) of the Code;

 

   

the accuracy of the representations and warranties of Orthofix or SeaSpine, as applicable, made in the merger agreement (subject to the materiality standards set forth in the merger agreement) as of the closing;

 

   

the performance by Orthofix or SeaSpine, as applicable, of its covenants and obligations under the merger agreement in all material respects;

 

   

the absence of the occurrence of a material adverse effect of Orthofix or SeaSpine since the date of the merger agreement; and

 

   

delivery of an officer certificate by each of Orthofix and SeaSpine, to the other party, certifying satisfaction of the conditions described in the preceding two bullet points.

 

Q:

Whom should I contact if I have any questions about the proxy materials or voting?

 

A:

If you have any questions about the proxy materials, or if you need assistance submitting your proxy or voting your shares or need additional copies of this joint proxy statement/prospectus or the enclosed Orthofix proxy card or SeaSpine proxy card, as applicable, you should contact Saratoga Proxy Consulting LLC, referred to as Saratoga, the proxy solicitation agent for Orthofix, at (212) 257-1311 or (888) 368-0379 or Kingsdale Advisors, referred to as Kingsdale, the proxy solicitation agent for SeaSpine, toll-free at (855) 476-7861 or collect outside North America at (917) 813-1235, as applicable.

 

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Q:

What do I do now?

 

A:

After you have carefully read this joint proxy statement/prospectus, please respond by completing, signing and dating your enclosed proxy card or voting instruction form forwarded by your broker, bank or other nominee and returning it in the enclosed pre-addressed postage-paid envelope or, if available, by submitting your proxy by one of the other methods specified in your proxy card or voting instruction form as promptly as possible so that your shares of Orthofix common stock and/or your shares of SeaSpine common stock will be represented and voted at the Orthofix special meeting or the SeaSpine special meeting, as applicable.

Please refer to your proxy card or voting instruction form to see which voting options are available to you.

Even if you plan to attend the Orthofix special meeting or the SeaSpine special meeting, we recommend that you also submit your proxy or voting instructions prior to the applicable special meeting as soon as possible so that your vote will be counted if you later decide not to attend the applicable special meeting.

The method by which you submit a proxy will in no way limit your right to vote at the Orthofix special meeting or the SeaSpine special meeting, as applicable, if you later decide to attend the meeting. However, if your shares of Orthofix common stock or shares of SeaSpine common stock are held in the name of a broker, bank or other nominee, you must obtain a legal proxy from your broker, bank or other nominee, to be able to vote in person at the Orthofix special meeting or at the SeaSpine special meeting.

 

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SUMMARY

This summary highlights selected information contained in this joint proxy statement/prospectus and does not contain all the information that may be important to you. Orthofix and SeaSpine urge you to read carefully this joint proxy statement/prospectus in its entirety, including the annexes. Additionally, important information, which Orthofix and SeaSpine also urge you to read, is contained in the documents incorporated by reference into this joint proxy statement/prospectus. See “Where You Can Find More Information.”

The Parties to the Merger (page 44)

Orthofix Medical Inc.

Orthofix is a global medical device company with a spine and orthopedics focus. Orthofix’s mission is to deliver innovative, quality-driven solutions while partnering with health care professionals to improve patient mobility. Headquartered in Lewisville, Texas, Orthofix’s spine and orthopedic products are distributed in more than 60 countries via its sales representatives and distributors. Orthofix manages its business by its two reporting segments, Global Spine and Global Orthopedics, which accounted for 77% and 23%, respectively, of its total net sales in 2021.

Within the Global Spine segment, Orthofix provides implantable medical devices, biologics, and other regenerative solutions which aim to restore the quality of life of patients suffering from diseases and traumas of the spine. Orthofix offers a variety of treatment solutions that uniquely incorporate multiple treatment modalities, such as mechanical, biological, and electromagnetic modes, to achieve desired clinical outcomes.

The Global Orthopedics reporting segment offers products and solutions that allow physicians to successfully treat a variety of orthopedic conditions unrelated to the spine. This reporting segment specializes in the design, development, and marketing of orthopedic products used in fracture repair, deformity correction, and bone reconstruction procedures. Orthofix distributes these products through a global network of distributors and sales representatives to sell its orthopedic products to hospitals and healthcare providers.

Orthofix has administrative and training facilities in the U.S., Italy, Brazil, U.K., France, and Germany, and manufacturing facilities in the U.S. and Italy. Orthofix directly distributes products in the U.S., Italy, the U.K., Germany, and France. In several of these and other markets, Orthofix also distributes its products through independent distributors.

Orthofix originally was formed in 1987 in Curaçao as “Orthofix International N.V.” In 2018, Orthofix completed a change in its jurisdiction of organization from Curaçao to the State of Delaware and changed its name to “Orthofix Medical Inc.” As a result, it is now a corporation existing under the laws of the State of Delaware.

Orthofix’s principal executive offices are located at 3451 Plano Parkway, Lewisville, Texas 75056, and its telephone number is (214) 937-2000. Orthofix’s website address is www.orthofix.com. Information contained on Orthofix’s website does not constitute part of this joint proxy statement/prospectus. Orthofix’s stock is publicly traded on Nasdaq under the ticker symbol “OFIX.” Additional information about Orthofix is included in documents incorporated by reference in this joint proxy statement/prospectus. Please see the section entitled “Where You Can Find More Information.”

SeaSpine Holdings Corporation

SeaSpine is a global medical technology company focused on the design, development and commercialization of surgical solutions for the treatment of patients suffering from spinal disorders. SeaSpine has a comprehensive portfolio of orthobiologics and spinal implant solutions, as well as a surgical navigation system, to meet the varying combinations of products that neurosurgeons and orthopedic spine surgeons need to

 

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perform fusion procedures in the lumbar, thoracic and cervical spine. SeaSpine believes this broad combined portfolio is essential to meet the “complete solution” requirements of these surgeons. SeaSpine reports revenue in two product categories: (i) orthobiologics and (ii) spinal implants and enabling technologies. SeaSpine’s orthobiologics products consist of a broad range of advanced and traditional bone graft substitutes designed to improve bone fusion rates following a wide range of orthopedic surgeries, including spine, hip, and extremities procedures. SeaSpine’s spinal implants and enabling technologies portfolio consists of an extensive line of products and image-guided surgical solutions to facilitate spinal fusion in degenerative, minimally invasive surgery (MIS), and complex spinal deformity procedures. Expertise in orthobiologic sciences and spinal implants, software and advanced optics product development allows SeaSpine to offer surgeon customers a differentiated portfolio and a complete solution to meet their patients’ fusion requirements. SeaSpine currently markets its products in the United States and in approximately 30 countries worldwide.

SeaSpine was incorporated in Delaware on February 12, 2015. Its principal executive offices are at 5770 Armada Drive, Carlsbad, California and its telephone number is (760) 727-8399. SeaSpine’s website address is www.seaspine.com. Information contained on SeaSpine’s website does not constitute part of this joint proxy statement/prospectus. SeaSpine’s stock is publicly traded on Nasdaq under the ticker symbol “SPNE.” Additional information about SeaSpine is included in documents incorporated by reference in this joint proxy statement/prospectus. Please see the section entitled “Where You Can Find More Information.”

Orca Merger Sub Inc.

Orca Merger Sub Inc., a wholly owned subsidiary of Orthofix, is a Delaware corporation incorporated on October 7, 2022, for the purpose of effecting the merger. Orca Merger Sub Inc. has not conducted any activities other than those incidental to its formation and the matters contemplated by the merger agreement. The principal executive offices of Orca Merger Sub Inc. are located at 3451 Plano Parkway, Lewisville, Texas 75056, and its telephone number is (214) 937-2000.

The Merger Agreement (page 117)

The terms and conditions of the merger are contained in the merger agreement, a copy of which merger agreement is attached as Annex A to this joint proxy statement/prospectus. We encourage you to read the merger agreement carefully and in its entirety, as it is the legal document that governs the merger.

On October 10, 2022, Orthofix, Merger Sub and SeaSpine entered into the merger agreement, which provides that, subject to the terms and conditions of the merger agreement and in accordance with the DGCL, Merger Sub will merge with and into SeaSpine, with SeaSpine continuing as the surviving corporation and a wholly owned subsidiary of Orthofix.

Merger Consideration (page 117)

At the effective time of the merger, upon the terms and subject to the conditions set forth in the merger agreement, each issued and outstanding share of SeaSpine common stock (other than excluded shares, which will be canceled and retired and cease to exist) will be converted into the right to receive 0.4163 fully paid and nonassessable shares of Orthofix common stock, and, if applicable, cash in lieu of fractional shares. The market value of Orthofix common stock at the time of completion of the merger could be greater than, less than or the same as the market value of Orthofix common stock on the date of this joint proxy statement/prospectus. Based on the closing price of Orthofix common stock on Nasdaq of $18.40 on October 10, 2022, the last trading day before public announcement of the merger, the merger consideration represented approximately $7.66 for each share of SeaSpine common stock. The closing price of SeaSpine common stock on the Nasdaq on October 10, 2022 was $5.57. We urge you to obtain current market quotations for the shares of common stock of Orthofix and SeaSpine.

For more details on the exchange ratio, see “The Merger Agreement — Merger Consideration.”

 

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Treatment of SeaSpine Equity Awards (page 118)

SeaSpine Restricted Stock Awards

As of immediately prior to the effective time, each outstanding SeaSpine restricted stock award will be converted into a restricted share award of Orthofix with the same terms and conditions that applied to such SeaSpine restricted stock award immediately prior to the effective time, including applicable vesting conditions (which include rights accruing under the SeaSpine Equity Plan or SeaSpine Inducement Plan, as applicable, as a result of the occurrence of a change in control ), relating to a number of shares of Orthofix common stock equal to the product, rounded down to the nearest whole number of shares, of (1) the number of shares of SeaSpine common stock subject to such SeaSpine restricted stock award and (2) the exchange ratio.

SeaSpine RSU Awards

As of immediately prior to the effective time, each outstanding SeaSpine RSU award will be converted into an award of restricted stock units of Orthofix with the same terms and conditions that applied to such SeaSpine RSU award immediately prior to the effective time, including applicable vesting conditions (which include rights accruing under the SeaSpine Equity Plan or SeaSpine Inducement Plan, as applicable, as a result of the occurrence of a change in control ), relating to a number of shares of Orthofix common stock equal to the product, rounded down to the nearest whole number of shares, of (1) the number of shares of SeaSpine common stock subject to such SeaSpine RSU award and (2) the exchange ratio.

SeaSpine Options

As of immediately prior to the effective time, each outstanding SeaSpine option will be converted into an option to acquire shares of Orthofix common stock at an adjusted exercise price per share, subject to the same terms and conditions as were applicable to such SeaSpine option immediately prior to the effective time (which includes rights accruing under the SeaSpine Equity Plan or SeaSpine Inducement Plan, as applicable, as a result of the occurrence of a change in control), including applicable vesting conditions; accordingly, effective as of the effective time: (A) each such option shall be exercisable solely for shares of Orthofix common stock; (B) the number of shares of Orthofix common stock subject to each such option shall be determined by multiplying the number of shares of SeaSpine common stock subject to the SeaSpine option by the exchange ratio and rounding down to the nearest whole number of shares of Orthofix common stock; and (C) the per share exercise price for the shares of Orthofix common stock issuable upon exercise of such option shall be determined by dividing the per share exercise price for the shares of SeaSpine common stock subject to the SeaSpine option, as in effect immediately prior to the effective time, by the exchange ratio, and rounding the resulting exercise price up to the nearest whole cent.

For additional information with respect to treatment of SeaSpine equity awards, please see “The Merger Agreement — Treatment of SeaSpine Equity Awards.”

Recommendation of the Orthofix Board (page 75)

After careful consideration of various factors described in “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — Orthofix Board’s Recommendation and Reasons for the Merger,” the Orthofix Board unanimously (1) approved and declared advisable the merger agreement and the transactions contemplated by the merger agreement, including the merger and the issuance of Orthofix common stock in connection with the merger, on the terms and subject to the conditions set forth in the merger agreement, (2) determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger and the issuance of Orthofix common stock in connection with the merger, are fair to, and in the best interests of, Orthofix and Orthofix’s stockholders, (3) resolved to recommend the approval of the issuance of Orthofix common stock in connection with the merger to the Orthofix stockholders, on the

 

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terms and subject to the conditions set forth in the merger agreement and (4) directed that the issuance of Orthofix common stock in connection with the merger be submitted to Orthofix stockholders for approval. The Orthofix Board unanimously recommends that holders of Orthofix common stock vote:

 

   

“FOR” the Orthofix share issuance proposal; and

 

   

“FOR” the Orthofix adjournment proposal.

Recommendation of the SeaSpine Board (page 81)

After careful consideration of various factors described in “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — SeaSpine Board’s Recommendations and Reasons for the Merger,” the SeaSpine Board unanimously approved and declared advisable the merger agreement and the transactions contemplated by the merger agreement (including the merger), determined that the merger agreement and the transactions contemplated by the merger agreement (including the merger) are fair to and in the best interests of SeaSpine and its stockholders, and directed that the merger agreement be submitted for SeaSpine stockholder approval and unanimously recommended that holders of SeaSpine common stock vote:

 

   

“FOR” the SeaSpine merger proposal;

 

   

“FOR” the SeaSpine merger-related compensation proposal; and

 

   

“FOR” the SeaSpine adjournment proposal.

Opinion of Orthofix’s Financial Advisor (page 83)

On October 10, 2022, Perella Weinberg Partners LP (“Perella Weinberg”) rendered its oral opinion to the Orthofix Board (which was subsequently confirmed in writing by delivery of Perella Weinberg’s written opinion, dated the same date) to the effect that, as of October 10, 2022, and based upon and subject to the various assumptions made, procedures followed, matters considered and qualifications and limitations set forth therein, the exchange ratio in the merger pursuant to the merger agreement was fair, from a financial point of view, to Orthofix.

The full text of the Perella Weinberg written opinion dated October 10, 2022, which sets forth, among other things, the assumptions made, procedures followed, matters considered and qualifications and limitations on the scope of the review undertaken by Perella Weinberg in rendering its opinion, is attached as Annex B to this joint proxy statement/prospectus and is incorporated by reference herein. Perella Weinberg’s opinion was addressed to and provided for the information and assistance of the Orthofix Board, in its capacity as such, in connection with, and for the purpose of, the Orthofix Board’s evaluation of the exchange ratio from a financial point of view, and does not address any other term, aspect or implication of the merger agreement or the merger. Perella Weinberg’s opinion does not address the underlying decision by Orthofix to engage in the merger nor the relative merits of the merger compared with any alternative transactions or business strategies. Perella Weinberg’s opinion was not intended to be and does not constitute a recommendation to any holder of shares of Orthofix common stock as to how such holder should vote or otherwise act with respect to the merger or any other matter. Perella Weinberg’s opinion does not in any manner address what the value of shares of SeaSpine common stock actually will be when issued or the prices at which shares of Orthofix common stock or SeaSpine common stock will trade at any time, including following announcement or completion of the merger. In addition, Perella Weinberg expressed no opinion as to the fairness of the merger to the holders of any other class of securities, creditors or other constituencies of Orthofix.

For more information, see Annex B to this joint proxy statement/prospectus and the section of this joint proxy statement/prospectus entitled “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of the Share Issuance — Opinion of Orthofix’s Financial Advisor.”

 

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Opinion of SeaSpine’s Financial Advisor (page 91)

On October 10, 2022, Piper Sandler & Co. (“Piper Sandler”) rendered its oral opinion to the SeaSpine Board (which was subsequently confirmed in writing by delivery of Piper Sandler’s written opinion, dated the same date) to the effect that, as of October 10, 2022, and based upon and subject to the various assumptions and limitations set forth therein, the exchange ratio was fair, from a financial point of view, to the holders of SeaSpine common stock.

The full text of the Piper Sandler written opinion dated October 10, 2022, which sets forth, among other things, the assumptions made, procedures followed, matters considered and limitations on the scope of the review undertaken by Piper Sandler in rendering its opinion, is attached as Annex C to this joint proxy statement/prospectus. The Piper Sandler opinion addresses solely the fairness, from a financial point of view, to holders of SeaSpine common stock of the exchange ratio. Piper Sandler’s opinion was provided to the SeaSpine Board in connection with its consideration of the merger and was not intended to be and does not constitute a recommendation to any SeaSpine stockholder as to how such stockholder should act or vote with respect to the merger or any other matter.

For more information, see Annex C to this joint proxy statement/prospectus and the section of this joint proxy statement/prospectus entitled “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of the Share Issuance—Opinion of SeaSpine’s Financial Advisor.”

Interests of Orthofix’s Directors and Executive Officers in the Merger (page 139)

Certain of Orthofix’s directors and executive officers have interests in the merger that are different from, or in addition to, the interests of stockholders of Orthofix generally. The members of the Orthofix Board were aware of, and considered, these interests, among other matters, in evaluating and negotiating the merger agreement and the merger, and in recommending that the stockholders of Orthofix approve the Orthofix share issuance proposal. Additional interests of the executive officers of Orthofix in the merger include certain performance stock unit achievement rights and certain post separation cash severance and equity acceleration rights, in each case as a result of the Orthofix Board’s determination, upon completion of the merger, to treat the transaction, if consummated, as a “Change in Control” under applicable agreements and equity plans. Additional interests of the directors of Orthofix include continued service on the board of the combined company or certain equity acceleration rights in the event that the director is not continuing. Orthofix’s stockholders should take these interests into account in deciding whether to vote “FOR” the Orthofix share issuance proposal.

See the section entitled “Interests of Orthofix’s Directors and Executive Officers in the Merger” for a more detailed description of these interests.

Interests of SeaSpine’s Directors and Executive Officers in the Merger (page 145)

The directors and executive officers of SeaSpine have interests in the merger that are different from, or in addition to, the interests of stockholders of SeaSpine generally. The members of the SeaSpine Board were aware of, and considered, these interests, among other matters, in evaluating and negotiating the merger agreement and the merger, and in recommending that the stockholders of SeaSpine approve the SeaSpine merger proposal. Additional interests of the directors and executive officers of SeaSpine in the merger include (i) the payment of certain severance and other benefits upon a qualifying termination of employment or service following the completion of the merger, (ii) continued employment or service on the board of the combined company and (iii) the continued provision of indemnification and insurance coverage for current and former directors and executive officers of SeaSpine in accordance with the merger agreement. SeaSpine’s stockholders should take these interests into account in deciding whether to vote “FOR” the SeaSpine merger proposal.

See the sections entitled “Interests of SeaSpine’s Directors and Executive Officers in the Merger” and “The Merger Agreement — Covenants and Agreements — Indemnification, Exculpation and Insurance” for a more detailed description of these interests.

 

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Information about the Orthofix Special Meeting (page 46)

Time, Place and Purpose of the Orthofix Special Meeting

The Orthofix special meeting to consider and vote upon the Orthofix share issuance proposal and related matters will be held at Hampton Inn & Suites, 3650 Plano Pkwy, The Colony, TX 75056 on January 4, 2023, at 11 a.m. Central Time.

At the Orthofix special meeting, Orthofix stockholders will be asked to consider and vote upon (1) the Orthofix share issuance proposal and (2) the Orthofix adjournment proposal.

Orthofix Record Date and Quorum

You are entitled to receive notice of, and to vote at, the Orthofix special meeting if you are an owner of record of shares of Orthofix common stock as of the close of business on November 10, 2022, the Orthofix record date. On the Orthofix record date, there were 20,011,598 shares of Orthofix common stock outstanding and entitled to vote. Orthofix stockholders will have one vote on all matters properly coming before the Orthofix special meeting for each share of Orthofix common stock owned by such stockholders on the Orthofix record date.

The Orthofix bylaws provide that the presence at the Orthofix special meeting, in person or represented by proxy, of holders of a majority of the aggregate voting power of the stock issued and outstanding and entitled to vote at the meeting as of the Orthofix record date constitutes a quorum for the transaction of business at the Orthofix special meeting.

Vote Required

The Orthofix share issuance proposal requires the affirmative vote of a majority in voting power of the shares of Orthofix common stock present in person or represented by proxy at the Orthofix special meeting and entitled to vote on the proposal. If an Orthofix stockholder present in person at the Orthofix special meeting abstains from voting, or responds by proxy with an “abstain” vote, it will have the same effect as a vote cast “AGAINST” such proposal. If an Orthofix stockholder is not present in person at the Orthofix special meeting and does not respond by proxy or does not provide his, her or its bank, broker or other nominee with instructions, as applicable, it will have no effect on the vote count for such proposal.

The Orthofix adjournment proposal requires the affirmative vote of a majority in voting power of the shares of Orthofix common stock present in person or represented by proxy at the Orthofix special meeting and entitled to vote on the proposal. If an Orthofix stockholder present in person at the Orthofix special meeting abstains from voting, or responds by proxy with an “abstain” vote, it will have the same effect as a vote cast “AGAINST” such proposal. If an Orthofix stockholder is not present in person at the Orthofix special meeting and does not respond by proxy or does not provide his, her or its bank, broker or other nominee with instructions, as applicable, it will have no effect on the vote count for such proposal.

Proxies and Revocations

Any Orthofix stockholder of record entitled to vote at the Orthofix special meeting may submit a proxy by telephone, over the Internet, by returning the enclosed Orthofix proxy card in the accompanying prepaid reply envelope or may vote in person by appearing at the Orthofix special meeting. If your shares of Orthofix common stock are held in “street name” through a bank, broker or other nominee, you should instruct your bank, broker or other nominee on how to vote your shares of Orthofix common stock using the instructions provided by your bank, broker or other nominee.

 

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We expect that many Orthofix stockholders will not attend the Orthofix special meeting in person, and instead will be represented by proxy. Most Orthofix stockholders have a choice of voting over the Internet, by using a toll-free telephone number, or by returning a completed proxy card or voting instruction form. Please check your notice, proxy card or the information forwarded by your broker, bank, trust or other holder of record to see which options are available to you. The Internet and telephone voting procedures have been designed to authenticate Orthofix stockholders, to allow you to vote your shares, and to confirm that your instructions have been properly recorded. The Internet and telephone voting facilities for Orthofix stockholders of record will close at the start of the Orthofix special meeting at 11 a.m. Central Time on January 4, 2023. If your shares are held through a broker, bank, trust or other holder of record and Internet or telephone facilities are made available to you, these facilities may close sooner than those for stockholders of record.

You can revoke your proxy before it is exercised by delivering a properly executed, later-dated proxy (including an Internet or telephone vote) or by voting by ballot at the Orthofix special meeting. Executing your proxy in advance will not limit your right to vote at the Orthofix special meeting if you decide to attend in person. However, if your shares are held in the name of a broker, bank, trust or other holder of record, you cannot vote at the Orthofix special meeting unless you have a legal proxy, executed in your favor, from the holder of record.

If you are a record holder, you may change or revoke your vote before your proxy is voted at the Orthofix special meeting as described herein. You may do this in one of the following four ways: (1) by logging onto the Internet website specified on your Orthofix proxy card in the same manner you would to submit your proxy electronically or by calling the telephone number specified on your Orthofix proxy card, in each case, if you are eligible to do so; (2) by sending a notice of revocation to the corporate secretary of Orthofix; (3) by sending a completed Orthofix proxy card bearing a later date than your original Orthofix proxy card; or (4) by attending the Orthofix special meeting and voting in person. If you choose any of the first three methods, you must take the described action no later than the beginning of the Orthofix special meeting.

Information about the SeaSpine Special Meeting (page 52)

Time, Place and Purpose of the SeaSpine Special Meeting

The SeaSpine special meeting to consider and vote upon the SeaSpine merger proposal and related matters, will be held at the offices of DLA Piper LLP (US), 4365 Executive Drive, 4th Floor, San Diego, CA 92121 on January 4, 2023, at 9 a.m. Pacific Time.

At the SeaSpine special meeting, the SeaSpine stockholders will be asked to consider and vote upon (1) the SeaSpine merger proposal, (2) the SeaSpine merger-related compensation proposal and (3) the SeaSpine adjournment proposal.

SeaSpine Record Date and Quorum

You are entitled to receive notice of, and to vote at, the SeaSpine special meeting if you are an owner of record of shares of SeaSpine common stock as of the close of business on November 10, 2022, the SeaSpine record date. On the SeaSpine record date, there were 37,755,164 shares of SeaSpine common stock outstanding and entitled to vote. SeaSpine stockholders will have one vote on all matters properly coming before the SeaSpine special meeting for each share of SeaSpine common stock owned by such SeaSpine stockholders on the SeaSpine record date.

The presence at the SeaSpine special meeting, in person or by proxy, of holders representing a majority in voting power of the shares of the SeaSpine common stock outstanding and entitled to vote at the meeting as of the SeaSpine record date constitutes a quorum for the transaction of business at the SeaSpine special meeting.

 

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Vote Required

The SeaSpine merger proposal requires the affirmative vote of the holders of a majority of the shares of SeaSpine common stock outstanding as of the SeaSpine record date and entitled to vote on the proposal. If a SeaSpine stockholder present in person at the SeaSpine special meeting abstains from voting, responds by proxy with an “abstain” vote, or is not present in person at the SeaSpine special meeting and does not respond by proxy or does not provide his, her or its bank, broker or other nominee with instructions, as applicable, it will have the effect of a vote cast “AGAINST” such proposal.

The SeaSpine merger-related compensation proposal requires the affirmative vote of holders of a majority of the voting power of the shares of SeaSpine common stock entitled to vote on the proposal represented in person or by proxy. If a SeaSpine stockholder present in person at the SeaSpine special meeting abstains from voting, or responds by proxy with an “abstain” vote, it will have the same effect as a vote cast “AGAINST” such proposal. If a SeaSpine stockholder is not present in person at the SeaSpine special meeting and does not respond by proxy or does not provide his, her or its bank, broker or other nominee with instructions, as applicable, it will have no effect on the vote count for such proposal.

The SeaSpine adjournment proposal requires the affirmative vote of the holders of a majority of the voting power of the shares of SeaSpine common stock entitled to vote on the proposal represented in person or by proxy. If a SeaSpine stockholder present in person at the SeaSpine special meeting abstains from voting, or responds by proxy with an “abstain” vote, it will have the same effect as a vote cast “AGAINST” such proposal. If a SeaSpine stockholder is not present in person at the SeaSpine special meeting and does not respond by proxy or does not provide his, her or its bank, broker or other nominee with instructions, as applicable, it will have no effect on the vote count for such proposal.

Proxies and Revocations

Any SeaSpine stockholder of record entitled to vote at the SeaSpine special meeting may submit a proxy by telephone, over the Internet, by returning the enclosed SeaSpine proxy card in the accompanying prepaid reply envelope or may vote in person by appearing at the SeaSpine special meeting. If your shares of SeaSpine common stock are held in “street name” through a bank, broker or other nominee, you should instruct your bank, broker or other nominee on how to vote your shares of SeaSpine common stock using the instructions provided by your bank, broker or other nominee.

We expect that many SeaSpine stockholders will not attend the SeaSpine special meeting in person, and instead will be represented by proxy. Most SeaSpine stockholders have a choice of voting over the Internet, by using a toll-free telephone number, or by returning a completed proxy card or voting instruction form. Please check your notice, proxy card or the information forwarded by your broker, bank, trust or other holder of record to see which options are available to you. The Internet and telephone voting procedures have been designed to authenticate SeaSpine stockholders, to allow you to vote your shares, and to confirm that your instructions have been properly recorded. The Internet and telephone voting facilities for SeaSpine stockholders of record will close at 11:59 p.m. Eastern Time on January 3, 2023. If your shares are held through a broker, bank, trust or other holder of record and Internet or telephone facilities are made available to you, these facilities may close sooner than those for stockholders of record.

You can revoke your proxy before it is exercised by delivering a properly executed, later-dated proxy (including an Internet or telephone vote) or by voting by ballot at the SeaSpine special meeting. Executing your proxy in advance will not limit your right to vote at the SeaSpine special meeting if you decide to attend in person. However, if your shares are held in the name of a broker, bank, trust or other holder of record, you cannot vote at the SeaSpine special meeting unless you have a legal proxy, executed in your favor, from the holder of record.

 

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If you are a record holder of SeaSpine common stock, you may change or revoke your vote before your proxy is voted at the SeaSpine special meeting as described herein. You may do this in one of the following four ways: (1) by logging onto the Internet website specified on your SeaSpine proxy card in the same manner you would to submit your proxy electronically or by calling the telephone number specified on your SeaSpine proxy card, in each case, if you are eligible to do so; (2) by sending a notice of revocation to the corporate secretary of SeaSpine; (3) by sending a completed SeaSpine proxy card bearing a later date than your original SeaSpine proxy card; or (4) by attending the SeaSpine special meeting and voting in person. If you choose any of the first three methods, you must take the described action no later than the beginning of the SeaSpine special meeting.

All shares entitled to vote and represented by properly executed proxies received prior to the SeaSpine special meeting and not revoked will be voted at the SeaSpine special meeting in accordance with your instructions. If you sign and return your proxy but do not indicate how your shares should be voted on a proposal, the shares represented by your proxy will be voted as the SeaSpine Board recommends for such proposal.

Voting by Orthofix Directors and Executive Officers (page 47)

As of the close of business on November 10, 2022, the most recent practicable date for which such information was available, directors and executive officers of Orthofix and their affiliates owned and were entitled to vote 211,519 shares (or approximately 1.1%) of Orthofix common stock. It is currently expected that Orthofix’s directors and executive officers will vote their shares of Orthofix common stock in favor of each of the proposals to be considered at the Orthofix special meeting, although none of them have entered into any agreement obligating them to do so. For information with respect to Orthofix common stock owned by directors and executive officers of Orthofix, please see the section entitled “Orthofix Beneficial Ownership Table.”

Voting by SeaSpine Directors and Executive Officers (page 53)

As of the close of business on November 10, 2022, the most recent practicable date for which such information was available, directors and executive officers of SeaSpine and its affiliates owned and were entitled to vote 1,398,440 shares (or approximately 3.7%) of SeaSpine common stock. It is currently expected that SeaSpine’s directors and executive officers will vote their shares of common stock in favor of each of the proposals to be considered at the SeaSpine special meeting, although none of them have entered into any agreement obligating them to do so. For information with respect to SeaSpine common stock owned by directors and executive officers of SeaSpine, please see the section entitled “SeaSpine Beneficial Ownership Table.”

Governance of the Combined Company (page 120)

The merger agreement, a copy of which is attached to this joint proxy statement/prospectus as Annex A, contains certain provisions relating to the governance of the combined company following completion of the merger, which reflects the merger of equals structure of the proposed business combination as set forth below.

Headquarters

After the completion of the merger, the combined company will be headquartered in Lewisville, TX. This location will conduct general business, product development, medical education and manufacturing. The combined company will retain primary offices in Carlsbad, CA, with a focus on spinal product innovation and surgeon education, and in Verona, Italy with an emphasis on product innovation, production, and medical education for orthopedics. Current facilities in Irvine, CA, Toronto, Canada, Sunnyvale, CA, Wayne, PA, Olive Branch, MS, Maidenhead, U.K., Munich, Germany, Paris, France and Sao Paulo, Brazil will also be retained.

 

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Management of the Combined Company

The combined company will be led by an experienced Board of Directors and leadership team that leverages the talent within both organizations.

Jon Serbousek, Orthofix’s current President, Chief Executive Officer, will serve as the combined company’s Executive Chairman of the Board, and Keith Valentine, SeaSpine’s current President and Chief Executive Officer, will serve as the combined company’s President and Chief Executive Officer and as a member of the combined company’s Board. Post-closing management roles of the combined company are also expected to include the following:

 

   

John Bostancic, SeaSpine’s current Chief Financial Officer, as the combined company’s Chief Financial Officer.

 

   

Kimberley Elting, Orthofix’s current Chief Legal and Development Officer and President, Global Orthopedics, as the combined company’s President, Global Orthopedics.

 

   

Kevin Kenny, Orthofix’s current President of Global Spine, as the combined company’s President, Global Spine.

 

   

Patrick Keran, SeaSpine’s current Senior Vice President, General Counsel and Secretary, as the combined company’s Chief Legal Officer.

 

   

Douglas Rice, Orthofix’s current Chief Financial Officer, providing assistance with the integration activities during a post-closing transition period.

 

   

Beau Standish, SeaSpine’s current President, Enabling Technologies, as the combined company’s President, Global Enabling Technologies.

Board of Directors

The board of directors of the combined company as of the completion of the merger will have nine members, consisting of:

 

   

Five directors, designated by the Orthofix Board, one of whom shall be the Executive Chair of the board of directors of the combined company; and each of whom, other than Mr. Serbousek, currently qualify, and are expected to continue to qualify, as an “independent director” under Nasdaq’s listing standards and the applicable rules of the SEC, referred to as the Orthofix continuing directors; and

 

   

Four directors, designated by the SeaSpine Board, each of whom, other than Mr. Valentine, is expected to qualify as an “independent director” under the listing standards of the Nasdaq and the applicable rules of the SEC, referred to as the SeaSpine continuing directors.

Following the completion of the merger, the board of directors of the combined company will continue to be comprised of the Orthofix continuing directors and the SeaSpine continuing directors, as described above.

Lead Independent Director

The Lead Independent Director of the combined company board will be an Orthofix-nominated director and is expected to be the current Chair of the Orthofix Board, Catherine Burzik.

 

 

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Committees of the Board of Directors

Following the completion of the merger, the board of directors of the combined company will have the following standing committees: the Audit and Finance Committee, the Compensation and Talent Development Committee, the Compliance and Ethics Committee, and the Nominating, Governance and Sustainability Committee. The compositions of the respective committees will be discussed and agreed upon by the Orthofix Board and the SeaSpine Board prior to the effective time, provided that the Chair of the Nominating, Governance and Sustainability Committee will be a SeaSpine nominated director.

See “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — Governance of the Combined Company.”

Litigation Relating to the Merger (See page 112)

On each of November 17, 2022 and November 21, 2022, purported SeaSpine stockholders filed a complaint against SeaSpine and the members of the SeaSpine Board in the United States District Court for the Southern District of New York. The complaints assert claims under Section 14(a) of the Exchange Act and Rule 14a-9 promulgated thereunder and Section 20(a) of the Exchange Act for allegedly causing the filing with the SEC on November 8, 2022 of a materially incomplete and misleading registration statement on Form S-4. Among other remedies, the plaintiffs seek to enjoin the merger. On November 19, 2022, counsel to two different purported SeaSpine stockholders sent demand letters making similar assertions. In addition, on November 15, 2022, counsel to a purported Orthofix stockholder sent a demand letter to Orthofix’s counsel attaching a draft federal court complaint against Orthofix and the members of the Orthofix Board making similar claims under Section 14(a) of the Exchange Act and Rule 14a-9 promulgated thereunder and Section 20(a) of the Exchange Act, and also seeking to enjoin the merger. Although the ultimate outcome of these lawsuits cannot be predicted with certainty, Orthofix and SeaSpine believe the claims are without merit and intend to defend against these actions vigorously.

For more information, see “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — Litigation Related to the Merger.”

Regulatory Approvals (page 112)

Under the HSR Act and related rules, certain transactions, including the merger, may not be completed until notifications have been given and information furnished to the Antitrust Division of the United States Department of Justice, referred to as the Antitrust Division, and the United States Federal Trade Commission, referred to as the FTC, and all statutory waiting period requirements have been satisfied. Completion of the merger is subject to the expiration or earlier termination of the applicable waiting period under the HSR Act. Orthofix and SeaSpine each filed their respective HSR Act notification forms on October 21, 2022, which commenced the initial waiting period of 30 days. On November 21, 2022, the waiting period under the HSR Act expired without a request for additional information.

There can be no assurance that a challenge to the merger on antitrust or other regulatory grounds will not be made or, if such a challenge is made, that it would not be successful.

See “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — Regulatory Approvals.”

 

 

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Conditions to Completion of the Merger (page 134)

In addition to the approval of the Orthofix share issuance proposal by Orthofix stockholders and of the SeaSpine merger proposal by SeaSpine stockholders, completion of the merger is subject to the satisfaction (or waiver to the extent permitted by law) of a number of other conditions, including:

 

   

the registration statement on Form S-4, of which this joint proxy statement/prospectus forms a part, becoming effective under the Securities Act, and no stop order having been issued;

 

   

the expiration or termination of any applicable waiting period (and any extension thereof) under the HSR Act, and the expiration of any mandatory waiting period or the receipt of any required consent under any other applicable antitrust laws except for such waiting periods or consents that are not reasonably expected to delay or prevent the completion of the merger or have a material adverse effect on the expected benefits of the merger to SeaSpine and Orthofix, taken as a whole;

 

   

approval of the listing on Nasdaq of the shares of Orthofix common stock issued or issuable pursuant to the merger agreement;

 

   

the absence of an injunction or law prohibiting the merger;

 

   

receipt by SeaSpine of an opinion of its respective outside counsel to the effect that the merger will qualify as a “reorganization” within the meaning of Section 368(a) of the Code;

 

   

the accuracy of the representations and warranties of Orthofix or SeaSpine, as applicable, made in the merger agreement (subject to the materiality standards set forth in the merger agreement);

 

   

the performance by Orthofix or SeaSpine, as applicable, of its covenants and agreements under the merger agreement in all material respects;

 

   

the absence of the occurrence of a material adverse effect of Orthofix or SeaSpine since the date of the merger agreement; and

 

   

delivery of an officer certificate by the other party certifying satisfaction of the conditions described in the preceding three bullet points.

The parties expect to complete the merger after all of the conditions to the merger in the merger agreement are satisfied or waived, including after Orthofix receives stockholder approval of the Orthofix share issuance proposal at the Orthofix special meeting and SeaSpine receives stockholder approval of the SeaSpine merger proposal at the SeaSpine special meeting, and after Orthofix and SeaSpine receive all required regulatory approvals. For a more complete description of the conditions to the merger, see “The Merger Agreement — Conditions to the Merger.”

Timing of the Merger (page 112)

The parties expect the merger to be completed in the first quarter of 2023. Neither Orthofix nor SeaSpine can predict, however, the actual date on which the merger will be completed because it is subject to conditions beyond each company’s control, including obtaining necessary regulatory approvals. For a more complete description of the conditions to the merger, see “The Merger Agreement — Conditions to the Merger.”

Ownership of the Combined Company after the Merger

As of the date of this joint proxy statement/prospectus, based on the current number of shares of Orthofix common stock and SeaSpine common stock outstanding and reserved for issuance, we estimate that, immediately following completion of the merger, former holders of SeaSpine common stock will own approximately 43.5%, and pre-merger holders of Orthofix common stock will own approximately 56.5%, of the outstanding common

 

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stock on a diluted basis (calculated using the treasury stock method). The exact equity stake of Orthofix stockholders and SeaSpine stockholders in the combined company immediately following the merger will depend on the number of shares of Orthofix common stock and SeaSpine common stock issued and outstanding immediately prior to the merger.

No Solicitation; Board Recommendations (page 127)

As more fully described in this joint proxy statement/prospectus and in the merger agreement, and subject to the exceptions summarized below, each of Orthofix and SeaSpine has agreed that it will not, and it will cause its subsidiaries not to, and instruct its and their respective officers, directors, employees, financial advisors, legal counsel, accountants, consultants, agents and other representatives not to, directly or indirectly (1) initiate, seek or solicit, or knowingly encourage or facilitate (including by way of furnishing non-public information) or take any other action that is reasonably expected to promote, directly or indirectly, any inquiries or the making or submission of any proposal that constitutes, or would reasonably be expected to lead to, an acquisition proposal with respect to itself, (2) participate or engage in discussions or negotiations with, or disclose any non-public information or data relating to itself or any of its subsidiaries or afford access to the properties, books or records of itself or any of its subsidiaries to any person or group of persons (or any of their affiliates or representatives) that has made an acquisition proposal with respect to it, or (3) enter into any agreement, including any letter of intent, memorandum of understanding, agreement in principle, merger agreement, acquisition agreement or other similar agreement, with respect to an acquisition proposal with respect to itself.

If, however, prior to obtaining the approval of its stockholders, Orthofix or SeaSpine receives a written acquisition proposal from a third party that constitutes, or that its respective board of directors determines in good faith is reasonably expected to lead to, a superior proposal, then Orthofix or SeaSpine, as applicable, may, subject to certain conditions included in the merger agreement, disclose any non-public information or data relating to, or afford access to the properties, books, or records of, itself or any of its subsidiaries to and participate or engage in discussions or negotiations with that third party with respect to that proposal.

For a more complete description of the limitations on the solicitation of transaction proposals from third parties and the ability of the Orthofix Board or the SeaSpine Board, as applicable, to change its respective recommendation with respect to the transaction, see “The Merger Agreement — Covenants and Agreements — No Solicitation; Board Recommendations.”

Termination of the Merger Agreement; Termination Fee (page 135)

The merger agreement may be terminated and the merger may be abandoned at any time prior to the effective time by mutual written consent of SeaSpine and Orthofix. In addition, the merger agreement may be terminated by either SeaSpine or Orthofix:

 

   

if the other party’s covenants, obligations, representations or warranties contained in the merger agreement have been breached or any of the other party’s representations or warranties have become untrue, such that the applicable condition to complete the merger would not be satisfied and any such breach or failure of a representation or warranty to be true (A) is incapable of being cured by such party or (B) is not cured within 45 days after receiving written notice of such breach or failure to be true;

 

   

if the other party’s board of directors or any committee thereof either (1) makes an adverse recommendation change, (2) does not include its recommendation in the joint proxy statement or (3) publicly proposes to take any of the actions in clause (1) or (2);

 

   

if the other party materially breaches the non-solicitation obligations under the merger agreement;

 

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if, at any time prior to obtaining its stockholder approval, the party terminates in order to enter into a definitive agreement with respect to a superior proposal and the party has complied with its non-solicitation obligations under the merger agreement;

 

   

if either party’s stockholder approval has not been obtained (provided that this right to terminate is not available to a party whose material breach of its obligations under any provision of the merger agreement has been the principal cause, or principally resulted in, the failure to obtain its stockholder approval);

 

   

if (1) any governmental body of competent jurisdiction shall have issued or entered any order that has become final and non-appealable or any applicable law is enacted or promulgated, in each case, that has the effect of permanently restraining, enjoining or otherwise prohibiting the merger, or (2) any expiration, termination authorization or consent from a governmental body required to be obtained pursuant to the antitrust closing conditions of the merger agreement shall have been denied and such denial shall have become final and non-appealable (provided that this right is not available to a party whose material breach of its obligations under any provision of the merger agreement has been the principal cause of, or principally resulted in, such order or law); or

 

   

the merger is not completed by March 10, 2023, referred to as the termination date. However, the termination date may be extended by written notice of any party to a date not beyond June 10, 2023, if on the termination date all other closing conditions contemplated by the merger agreement are satisfied or waived except for the antitrust closing conditions of the merger agreement (provided that this right to terminate is not available to a party whose material breach of its obligations under any provision of the merger agreement has been the principal cause, or principally resulted in, the failure of the merger to be completed by the termination date).

If the merger agreement is terminated as described above, the merger agreement shall be of no further force or effect, subject to certain exceptions, including as described below and that no party will be relieved from liability for any intentional and material breach of the merger agreement, or fraud.

The merger agreement provides for payment of a termination fee by SeaSpine to Orthofix of approximately $10.6 million as well as Orthofix’s and its affiliates reasonable, documented out-of-pocket fees and expenses (not to exceed $2.0 million in the aggregate) in connection with a termination of the merger agreement under the following circumstances:

 

   

if Orthofix terminates the merger agreement pursuant to the following:

 

   

the SeaSpine Board or any committee thereof either (1) makes an adverse recommendation change, (2) does not include its recommendation in the joint proxy statement or (3) publicly proposes to take any of the actions in clause (1) or (2); or

 

   

SeaSpine materially breaches its non-solicitation obligations under the merger agreement; or

 

   

prior to obtaining the approval of the stockholders of SeaSpine, SeaSpine terminates in order to enter into a definitive agreement with respect to a superior proposal and SeaSpine has otherwise complied with its non-solicitation obligations under the merger agreement.

SeaSpine will be obligated to pay Orthofix’s and its affiliates’ reasonable, documented out-of-pocket fees and expenses (not to exceed $2.0 million in the aggregate) if prior to the SeaSpine stockholders’ meeting an acquisition proposal with respect to SeaSpine is publicly proposed or publicly disclosed:

 

   

The acquisition proposal is not irrevocably withdrawn at or prior to the SeaSpine stockholder’s meeting and termination of the merger agreement occurs because SeaSpine stockholder approval is not obtained; or

 

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If the merger agreement is being terminated due to SeaSpine’s breach of any of its representations, warranties, covenants or other agreements contained in the merger agreement and the acquisition proposal is not irrevocably withdrawn prior to the time of the relevant breach or failure to be true of a covenant, obligation, representation or warranty.

Further, if within 12 months of such termination, SeaSpine enters into a definitive agreement with respect to an acquisition proposal which is ultimately consummated (except that all references in the definition of acquisition proposal within the merger agreement to “20%” will be deemed replaced with “50%”), then SeaSpine will pay to Orthofix a one-time termination fee of approximately $10.6 million.

The merger agreement provides for payment of a termination fee by Orthofix to SeaSpine of approximately $13.7 million as well as SeaSpine’s and its affiliates reasonable, documented out-of-pocket fees and expenses (not to exceed $2.0 million in the aggregate) in connection with a termination of the merger agreement under the following circumstances:

 

   

if SeaSpine terminates the merger agreement pursuant to the following:

 

   

the Orthofix Board or any committee thereof either (1) makes an adverse recommendation change, (2) does not include its recommendation in the joint proxy statement or (3) publicly proposes to take any of the actions in clause (1) or (2); or

 

   

Orthofix materially breaches its non-solicitation obligations under the merger agreement; or

 

   

prior to obtaining the approval of the stockholders of Orthofix, Orthofix terminates in order to enter into a definitive agreement with respect to an unsolicited superior proposal and Orthofix has otherwise complied with its non-solicitation obligations under the merger agreement.

Orthofix will be obligated to pay SeaSpine’s and its affiliates’ reasonable, documented out-of-pocket fees and expenses (not to exceed $2.0 million in the aggregate) if prior to the Orthofix stockholders’ meeting an acquisition proposal with respect to Orthofix is publicly proposed or publicly disclosed:

 

   

The acquisition proposal is not irrevocably withdrawn at or prior to the Orthofix stockholder’s meeting and termination of the merger agreement occurs because Orthofix stockholder approval is not obtained; or

 

   

If the merger agreement is being terminated due to Orthofix’s (or its subsidiary’s) breach of its representations, warranties, covenants or other agreements contained in the merger agreement and the acquisition proposal is not irrevocably withdrawn prior to the time of the relevant breach or failure to be true of a covenant, obligation, representation or warranty.

Further, if within 12 months of such termination, Orthofix enters into a definitive agreement with respect to an acquisition proposal which is ultimately consummated (except that all references in the definition of acquisition proposal within the merger agreement to “20%” will be deemed replaced with “50%”), then Orthofix will pay to SeaSpine a one-time termination fee of approximately $13.7 million.

For a more complete description of each party’s termination rights and the related termination fee obligations, see “The Merger Agreement — Termination” and “The Merger Agreement — Expenses and Termination Fees.”

No Appraisal Rights (page 113)

Holders of Orthofix common stock and holders of SeaSpine common stock are not entitled to appraisal rights under the DGCL with respect to the merger. For more information, see “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — No Appraisal Rights in the Merger.”

 

 

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Material U.S. Federal Income Tax Consequences of the Merger (page 113)

The obligation of SeaSpine to complete the merger is conditioned upon the receipt by SeaSpine of an opinion of its outside counsel to the effect that the merger will qualify as a “reorganization” within the meaning of Section 368(a) of the Code. Provided the merger qualifies as a “reorganization,” U.S. holders (as defined in the section entitled “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — Material U.S. Federal Income Tax Consequences of the Merger”) of shares of SeaSpine common stock generally will not recognize any gain or loss for U.S. federal income tax purposes upon the receipt of Orthofix common stock in exchange for SeaSpine common stock in the merger (other than gain or loss, if any, with respect to any cash received in lieu of a fractional share of SeaSpine common stock).

The material U.S. federal income tax consequences of the merger are discussed in more detail in the section entitled “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — Material U.S. Federal Income Tax Consequences of the Merger.” The discussion of the material U.S. federal income tax consequences contained in this joint proxy statement/prospectus is intended to provide only a general discussion and is not a complete analysis or description of all potential U.S. federal income tax consequences of the merger that may vary with, or are dependent on, individual circumstances. In addition, it does not address the effects of any foreign, state, or local tax laws or any U.S. federal tax laws other than U.S. federal income tax laws.

All holders of SeaSpine common stock should consult their own tax advisors as to the specific tax consequences to them of the merger, including the applicability and effect of any U.S. federal, state, local, non-U.S. and other tax laws.

Accounting Treatment (page 116)

Orthofix prepares its financial statements in accordance with GAAP. The merger will be accounted for as an acquisition of SeaSpine by Orthofix under the acquisition method of accounting in accordance with GAAP. Orthofix will be treated as the acquiror for accounting purposes. In identifying Orthofix as the accounting acquiror, Orthofix and SeaSpine considered the structure of the transaction and other actions contemplated by the merger agreement, relative outstanding share ownership and market values, the composition of the combined company’s board of directors, and the relative size of Orthofix and SeaSpine.

Rights of SeaSpine Stockholders Will Change as a Result of the Merger (page 174)

SeaSpine stockholders will have different rights once they become Orthofix stockholders due to differences between the organizational documents of Orthofix and SeaSpine. These differences are described in more detail under “Comparison of the Rights of Orthofix Stockholders and SeaSpine Stockholders.”

Risk Factors (page 33)

You should consider all the information contained in or incorporated by reference into this joint proxy statement/prospectus in deciding how to vote for the proposals presented in this joint proxy statement/prospectus. In particular, you should carefully consider the risks that are described in the section entitled “Risk Factors.”

 

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SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF ORTHOFIX

The following selected historical consolidated financial data has been taken from (1) the unaudited condensed consolidated financial statements of Orthofix and related notes for the nine months ended September 30, 2022, and September 30, 2021, and (2) the audited consolidated financial statements of Orthofix and related notes for the fiscal years ended December 31, 2021, 2020, 2019, 2018 and 2017, all of which have been prepared in accordance with GAAP.

The data set forth below is not necessarily indicative of Orthofix’s results of future operations and should be read in conjunction with Orthofix’s most recent SEC filings for a description of Orthofix’s reported results of operations, financial condition and capital resources, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in its Quarterly Report on Form 10-Q for the nine months ended September 30, 2022, as filed with the SEC on November  3, 2022, and its Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on February 25, 2022, each of which is incorporated by reference into this joint proxy statement/prospectus.

 

    Nine months ended
September 30,
    Year ended December 31,  
(U.S. Dollars, in thousands, except margin and
per share data)
  2022     2021     2021     2020     2019     2018     2017  
Consolidated operating results data:   (unaudited)                                

Net sales

  $ 338,484     $ 339,415     $ 464,479     $ 406,562     $ 459,955     $ 453,042     $ 433,823  

Cost of sales

    90,491       81,660       114,914       101,889       100,607       96,628       93,037  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

    247,993       257,755       349,565       304,673       359,348       356,414       340,786  

Gross margin

    73     76     75     75     78     79     79

Sales and marketing

    169,486       164,220       221,318       204,434       223,676       205,527       198,370  

General and administrative

    54,496       51,091       69,353       67,948       85,607       83,251       71,905  

Research and development

    35,913       36,378       49,621       39,056       34,637       33,218       29,700  

Acquisition-related amortization and remeasurement (1)

    (9,678     5,028       17,588       (499     34,212       4,324       —    
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating income (loss)

    (2,224     1,038       (8,315     (6,266     (18,784     30,094       40,811  

Net income (loss) from continuing operations

    (12,687     (3,890     (38,379     2,517       (28,462     13,811       7,291  

Net loss from discontinued operations

    —         —         —         —         —         —         (1,068
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

  $ (12,687   $ (3,890   $ (38,379   $ 2,517     $ (28,462   $ 13,811     $ 6,223  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) per common share – basic

             

Net income (loss) from continuing operations

  $ (0.63   $ (0.28   $ (1.95   $ 0.13     $ (1.51   $ 0.73     $ 0.40  

Net loss from discontinued operations

    —         —         —         —         —         —         (0.06
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

  $ (0.63   $ (0.28   $ (1.95   $ 0.13     $ (1.51   $ 0.73     $ 0.34  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss) per common share – diluted

             

Net income (loss) from continuing operations

  $ (0.63   $ (0.28   $ (1.95   $ 0.13     $ (1.51   $ 0.72     $ 0.39  

Net loss from discontinued operations

    —         —         —         —         —         —         (0.05
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income (loss)

  $ (0.63   $ (0.28   $ (1.95   $ 0.13     $ (1.51   $ 0.72     $ 0.34  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(1)

Acquisition-related amortization and remeasurement consists of (i) amortization related to intangible assets acquired through business combinations or asset acquisitions, (ii) the remeasurement of any related

 

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  contingent consideration arrangement, and (iii) recognized costs associated with acquired in-process research and development assets, which are recognized as expense immediately upon acquisition.

 

     As of September 30,      As of December 31,  

(U.S. Dollars, in thousands)

   2022      2021      2021      2020      2019      2018      2017  

Consolidated financial position data:

                    

Cash and cash equivalents

   $ 51,660      $ 82,710      $ 87,847      $ 96,291      $ 69,719      $ 69,623      $ 81,157  

Total assets

     449,660        500,395        476,623        525,861        495,620        466,641        405,354  

Long-term debt

     —          —          —          —          —          —          —    

Total liabilities

     116,121        135,562        139,689        168,997        167,989        131,244        108,746  

Shareholders’ equity

     333,539        364,833        336,934        356,864        327,631        335,397        296,608  

 

     Nine months ended
September 30,
    Year ended December 31,  

(U.S. Dollars, in thousands)

   2022     2021     2021     2020     2019     2018     2017  

Other financial data:

              

Net cash from operating activities

   $ (13,886   $ 6,696     $ 18,475     $ 74,272     $ 32,033     $ 49,918     $ 38,972  

Net cash from investing activities

     (18,634     (14,031     (23,013     (52,334 )(1)      (22,924     (60,998 )(2)      (16,474

Net cash from financing activities

     (1,576     (5,673     (3,621     3,245       (10,688     2,993       3,538  

Effect of exchange rate changes on cash

     (2,091     (598     (815     1,235       (207     (881     1,180  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net change in cash and cash equivalents

     (36,187     (13,606     (8,974     26,418       (1,786     (8,968     27,216  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net cash from operating activities

   $ (13,886   $ 6,696     $ 18,475     $ 74,272     $ 32,033     $ 49,918     $ 38,972  

Capital expenditures

     (17,260     (12,781     (19,592     (17,094     (20,524     (15,256     (16,948
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Free cash flow (3)

     (31,146     (6,085     (1,117     57,178       11,509       34,662       22,024  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Depreciation and amortization

   $ 21,598     $ 22,153     $ 29,599     $ 30,546     $ 24,699     $ 18,659     $ 20,124  

Share-based compensation expense

     13,521       11,470       15,432       16,207       21,540       18,930       12,557  

 

(1)

Net cash from investing activities for the year ended December 31, 2020, includes a cash outflow of $18.0 million related to Orthofix’s Asset Purchase Agreement with Wittenstein SE, a privately-held German-based company, to acquire assets associated with the FITBONE intramedullary lengthening system for limb lengthening of the femur and tibia bones, which was accounted for as a business combination.

(2)

Net cash from investing activities for the year ended December 31, 2018, includes a cash outflow of $44.3 million related to Orthofix’s acquisition of Spinal Kinetics Inc., a privately held developer and manufacturer of artificial cervical and lumbar discs for $45.0 million in net cash, subject to certain adjustments, plus potential milestone payments of up to $60.0 million in cash. This transaction was accounted for as a business combination.

(3)

Non-GAAP measure. For this purpose, free cash flow is calculated by subtracting capital expenditures from net cash from operating activities. Management uses free cash flow as an important indicator of how much cash is generated or used by our normal business operations, including capital expenditures. Management uses free cash flow as a measure of progress on its capital efficiency and cash flow initiatives.

 

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SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF SEASPINE

The following selected historical consolidated financial data has been taken from (1) the unaudited condensed consolidated financial statements of SeaSpine and related notes for the nine months ended September 30, 2022, and September 30, 2021, and (2) the audited consolidated financial statements of SeaSpine and related notes for the fiscal years ended December 31, 2021, 2020, 2019, 2018 and 2017, all of which have been prepared in accordance with GAAP.

The data set forth below is not necessarily indicative of SeaSpine’s results of future operations and should be read in conjunction with SeaSpine’s most recent SEC filings for a description of SeaSpine’s reported results of operations, financial condition and capital resources, including “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in its Quarterly Report on Form 10-Q for the nine months ended September 30, 2022, as filed with the SEC on November  3, 2022, and its Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on March 15, 2022, each of which is incorporated by reference into this joint proxy statement/prospectus.

 

    Nine months ended
September 30,
    Year ended December 31,  
    2022     2021     2021     2020     2019     2018     2017  

Total revenue, net

  $ 174,158     $ 135,862     $ 191,451     $ 154,345     $ 159,083     $ 143,443     $ 131,814  

Cost of goods sold

    66,140       51,137       76,864       56,841       57,979       55,969       51,826  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Gross profit

    108,018       84,725       114,587       97,504       101,104       87,474       79,988  

Operating expenses

             

Selling, general and administrative

    133,416       108,468       150,243       120,178       117,039       105,387       97,303  

Research and development

    18,095       15,618       22,006       16,258       15,125       12,058       12,180  

Intangible amortization

    2,568       2,577       3,316       3,169       3,169       3,168       3,168  

Impairment of intangible assets

    —         —         —         1,325       4,993       —         —    
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses

    154,079       126,663       175,565       140,930       140,326       120,613       112,651  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Operating income (loss)

    (46,061     (41,938     (60,978     (43,426     (39,222     (33,139     (32,663

Other (expense) income, net

    (976     5,689       (5,532     (463     (302     256       (430
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Loss before income taxes

    (47,037     (36,249     (55,446     (42,963     (38,920     (33,395     (32,233

Provision (benefit) for income taxes

    (986     (689     (1,100     218       356       129       (118
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net loss

  $ (46,051   $ (35,560   $ (54,346   $ (43,181   $ (39,276   $ (33,524   $ (32,115
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net loss per share, basic and diluted

    (1.25   $ (1.09     (1.62     (1.59     (2.07     (2.18     (2.58
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Weighted average shares used to compute basic and diluted net loss per share

    36,833       32,638       33,604       27,222       18,977       15,358       12,426  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

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    As of September 30,     As of December 31,  

(U.S. Dollars, in thousands)

  2022     2021     2021     2020     2019     2018     2017  

Consolidated financial position data:

             

Cash and cash equivalents

  $ 46,763     $ 102,433     $ 83,106     $ 76,813     $ 20,199     $ 24,233     $ 10,788  

Total assets

    374,124       390,000       377,267       214,401       141,718       172,342       134,474  

Long-term debt

    25,812       —         —         5,059       —         —         —    

Total liabilities

    99,665       63,159       64,903       42,683       31,958       30,257       28,821  

Shareholders’ equity

    274,459       326,841       312,364       171,718       109,760       142,085       105,653  
    Nine Month Ended
September 30,
    For the Year Ended December 31,  

(U.S. Dollars, in thousands)

  2022     2021     2021     2020     2019     2018     2017  

Other financial data:

             

Net cash from operating activities

  $ (34,186   $ (22,377   $ (33,512   $ (24,599   $ (20,277   $ (12,558   $ (8,622

Net cash from investing activities

    (25,743     (46,386     (55,358     (17,042     17,166       (38,104     (7,646

Net cash from financing activities

    24,068       94,684       95,545       98,138       (829     64,197       12,040  

Effect of exchange rate changes on cash

    (482     (301     (382     117       (94     (90     450  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net change in cash and cash equivalents

    (36,343     25,620       6,293       56,614       (4,034     13,445       (3,778
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

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RISK FACTORS

Risks Related to the Merger

The merger is subject to conditions, some or all of which may not be satisfied, or completed on a timely basis, if at all. Failure to complete the merger could have material adverse effects on Orthofix and SeaSpine.

The completion of the merger is subject to a number of conditions, including, among other things, the receipt of the Orthofix stockholder approval and the SeaSpine stockholder approval and receipt of certain regulatory approvals, which make the completion and timing of the merger uncertain. See the section entitled “The Merger Agreement — Conditions to the Merger” for a more detailed discussion. The failure to satisfy all of the required conditions could delay the completion of the merger for a significant period of time or prevent it from occurring at all. There can be no assurance that the conditions to the completion of the merger will be satisfied or waived or that the merger will be completed.

If the merger is not completed, each of Orthofix and SeaSpine may be materially adversely affected and, without realizing any of the benefits of having completed the merger, will be subject to a number of risks, including the following:

 

   

the market price of Orthofix common stock or SeaSpine common stock could decline;

 

   

Orthofix or SeaSpine could owe a substantial termination fee to the other party in specified circumstances;

 

   

if the merger agreement is terminated and the Orthofix Board or the SeaSpine Board seeks another business combination, Orthofix stockholders or SeaSpine stockholders, as applicable, cannot be certain that Orthofix or SeaSpine, as applicable, will be able to find a party willing to enter into a transaction on terms equivalent to or more attractive than the terms that the other party has agreed to in the merger agreement;

 

   

time and resources, financial and other, committed by Orthofix’s and SeaSpine’s management to matters relating to the merger could otherwise have been devoted to pursuing other beneficial opportunities;

 

   

Orthofix or SeaSpine may experience negative reactions from the financial markets or from its customers, suppliers or employees; and

 

   

Orthofix and SeaSpine will each be required to pay its costs relating to the merger, such as legal, accounting, financial advisory and printing fees, whether or not the merger is completed (subject to certain exceptions).

In addition, if the merger is not completed, each of Orthofix and SeaSpine could be subject to litigation related to any failure to complete the merger or related to any enforcement proceeding commenced against such party to perform its obligations under the merger agreement. Any of these risks could materially and adversely impact Orthofix’s or SeaSpine’s ongoing business, financial condition, financial results and stock price.

Similarly, delays in the completion of the merger could, among other things, result in additional transaction costs, loss of revenue or other negative effects associated with delay and uncertainty about completion of the merger and could materially and adversely impact Orthofix’s and SeaSpine’s ongoing business, financial condition, financial results and stock price following the completion of the merger.

The merger is subject to the expiration or termination of applicable waiting periods and the receipt of approvals, consents or clearances from several regulatory authorities that may impose conditions that could have an adverse effect on Orthofix, SeaSpine or the combined company or, if not obtained, could prevent completion of the merger.

Before the merger may be completed, any applicable waiting period (and any extension thereof) under the HSR Act relating to the completion of the merger must have expired or been terminated and any authorization or

 

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consent from a governmental authority required to be obtained with respect to the merger under certain other applicable foreign regulatory laws must have been obtained. In deciding whether to grant the required regulatory authorization or consent, the relevant governmental entities will consider the effect of the merger within their relevant jurisdiction, including, among other things, the impact on the parties’ respective customers and suppliers. The terms and conditions of the authorizations and consents that are granted, if any, may impose requirements, limitations or costs or place restrictions on the conduct of the combined company’s business or may materially delay the completion of the merger. Orthofix and SeaSpine each filed their respective HSR Act notification forms on October 21, 2022, which commenced the initial waiting period of 30 days. On November 21, 2022, the waiting period under the HSR Act expired without a request for additional information.

Under the merger agreement, Orthofix and SeaSpine have agreed to use their respective reasonable best efforts to obtain such authorizations and consents, and each of Orthofix and SeaSpine has agreed take all actions, and to do promptly, or cause to be done, and to assist and cooperate with each other in doing, all things necessary, proper or advisable under applicable laws to carry out the intent and purposes of the merger agreement and to consummate the transactions contemplated by the merger agreement. However, Orthofix’s and SeaSpine’s obligations to take such actions are subject to limitations, including that neither Orthofix nor SeaSpine will be required to divest, sell, dispose of, or license or agree to divest, sell, dispose of, or license any assets, businesses, rights or operations. For a more detailed description of Orthofix’s and SeaSpine’s obligations to obtain required regulatory authorizations and approvals, see the section entitled “The Merger Agreement — Covenants and Agreements — Efforts to Complete the Merger.”

In addition, at any time before or after the completion of the merger, and notwithstanding the termination of applicable waiting periods, the applicable U.S. or foreign regulatory authorities or any state attorney general could take such action under antitrust or applicable foreign investment laws as such party deems necessary or desirable in the public interest. Such action could include, among other things, seeking to enjoin the completion of the merger or seeking divestiture of substantial assets of the parties. In addition, in some circumstances, a third party could initiate a private action challenging, seeking to enjoin, or seeking to impose conditions on the merger. Orthofix and SeaSpine may not prevail and may incur significant costs in defending or settling any such action. For a more detailed description of the regulatory review process, see the section entitled “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — Regulatory Approvals.”

There can be no assurance that the conditions to the completion of the merger set forth in the merger agreement relating to applicable regulatory laws will be satisfied.

The merger agreement contains provisions that limit Orthofix’s and SeaSpine’s ability to pursue alternatives to the merger, could discourage a potential competing transaction counterparty of Orthofix or SeaSpine from making a favorable alternative transaction proposal, and provide that, in specified circumstances, each of Orthofix and SeaSpine would be required to pay a termination fee.

The merger agreement contains provisions that make it more difficult for SeaSpine to sell its business to a party other than Orthofix, or for Orthofix to sell its business. These provisions include a general prohibition on each party soliciting any acquisition proposal. Further, there are only limited exceptions to each party’s agreement that its board of directors will not withdraw or modify in a manner adverse to the other party the recommendation of its board of directors in favor of the adoption of the merger agreement, in the case of SeaSpine, or the approval of the stock issuance, in the case of Orthofix, and the other party generally has a right to attempt to match any acquisition proposal that may be made. However, at any time prior to the adoption of the merger agreement by SeaSpine stockholders, in the case of SeaSpine, or the approval of the Orthofix share issuance proposal by Orthofix stockholders, in the case of Orthofix, such party’s board of directors is permitted to make an adverse recommendation change if it determines in good faith that the failure to take such action would be reasonably likely to be inconsistent with its fiduciary duties under applicable law, as described further under “The Merger Agreement — Covenants and Agreements — Changes in Board Recommendations.”

 

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In some circumstances, upon termination of the merger agreement, SeaSpine would be required to pay a termination fee of approximately $10.6 million to Orthofix, and in some circumstances, upon termination of the merger agreement, Orthofix would be required to pay a termination fee of approximately $13.7 million to SeaSpine, each as contemplated by the merger agreement. For further discussion, see the section entitled “The Merger Agreement — Expenses and Termination Fees.”

The parties believe these provisions are reasonable and not preclusive of other offers, but these restrictions might discourage a third party that has an interest in acquiring all or a significant part of either SeaSpine or Orthofix from considering or proposing an acquisition proposal, even if that party was prepared to pay consideration with a higher per-share value than the currently proposed merger consideration, in the case of SeaSpine, or that party was prepared to enter into an agreement that may be favorable to Orthofix or its stockholders, in the case of Orthofix. Furthermore, the termination fees described above may result in a potential competing acquirer proposing to pay a lower per-share price to acquire the applicable party than it might otherwise have proposed to pay because of the added expense of the termination fee that may become payable by such party in certain circumstances.

The exchange ratio is fixed and will not be adjusted in the event of any change in either Orthofix’s or SeaSpine’s stock price.

Upon completion of the merger, each issued and outstanding share of SeaSpine common stock (other than excluded shares) will be converted into the right to receive the merger consideration, which is equal to 0.4163 fully paid and nonassessable shares of Orthofix common stock (and, if applicable, cash in lieu of fractional shares). This exchange ratio was fixed in the merger agreement and will not be adjusted for changes in the market price of either Orthofix common stock or SeaSpine common stock.

It is impossible to accurately predict the market price of Orthofix common stock at the completion of the merger and, therefore, impossible to accurately predict the market value of the shares of Orthofix common stock that SeaSpine stockholders will receive in the merger. The market price for Orthofix common stock may fluctuate both prior to the completion of the merger and thereafter for a variety of reasons, including, among others, general market and economic conditions, the demand for Orthofix’s or SeaSpine’s products and services, changes in laws and regulations, other changes in Orthofix’s and SeaSpine’s respective businesses, operations, prospects and financial results of operations, market assessments of the likelihood that the merger will be completed, and the expected timing of the merger. Many of these factors are beyond Orthofix’s and SeaSpine’s control. As a result, the market value represented by the exchange ratio will also vary.

Each party is subject to business uncertainties and contractual restrictions while the merger is pending, which could adversely affect each party’s business and operations.

In connection with the pendency of the merger, it is possible that some customers, suppliers and other persons with whom Orthofix and/or SeaSpine has a business relationship may delay or defer certain business decisions or might decide to seek to terminate, change or renegotiate their relationships with Orthofix or SeaSpine, as the case may be, as a result of the merger or otherwise, which could negatively affect Orthofix’s or SeaSpine’s respective revenues, earnings and/or cash flows, as well as the market price of Orthofix common stock or SeaSpine common stock, regardless of whether the merger is completed.

Under the terms of the merger agreement, each of Orthofix and SeaSpine is subject to certain restrictions on the conduct of its business prior to completing the merger, which may adversely affect its ability to execute certain of its business strategies, including the ability in certain cases to modify or terminate contracts, acquire or dispose of assets, incur indebtedness, pay dividends, incur capital expenditures or settle claims. Such limitations could adversely affect each of Orthofix’s and SeaSpine’s business and operations prior to the completion of the merger.

 

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Each of the risks described above may be exacerbated by delays or other adverse developments with respect to the completion of the merger. For further discussion, see the section entitled “The Merger Agreement — Covenants and Agreements — Conduct of Business.”

Completion of the merger may trigger change in control or other provisions in certain distributor, customer and other agreements to which Orthofix or SeaSpine is a party, which may have an adverse impact on the combined company’s business and results of operations following completion of the merger.

The completion of the merger may trigger change in control and other provisions in certain agreements to which Orthofix or SeaSpine is a party. If Orthofix or SeaSpine is unable to negotiate waivers of those provisions, counterparties may exercise their rights and remedies under the agreements, including terminating the agreements or seeking monetary damages or equitable remedies. Even if Orthofix and SeaSpine are able to negotiate consents or waivers, the counterparties may require a fee for such waivers or seek to renegotiate the agreements on terms less favorable to Orthofix or SeaSpine. Any of the foregoing or similar developments may have an adverse impact on the combined company’s business and results of operations following completion of the merger.

Uncertainties associated with the merger may cause a loss of management personnel and other key employees, which could adversely affect the future business and operations of the combined company following completion of the merger.

Orthofix and SeaSpine are dependent on the experience and industry knowledge of their officers and other key employees to execute their business plans. The combined company’s success after the completion of the merger will depend in part upon the ability of the combined company to retain certain key management personnel and employees of Orthofix and SeaSpine. Prior to the completion of the merger, current and prospective employees of Orthofix and SeaSpine may experience uncertainty about their roles following the completion of the transactions, which may have an adverse effect on the ability of each of Orthofix and SeaSpine to attract or retain key management and other key personnel. In addition, no assurance can be given that the combined company, after the completion of the merger, will be able to attract or retain key management personnel and other key employees to the same extent that Orthofix and SeaSpine have previously been able to attract or retain their own employees.

The unaudited pro forma combined financial information in this joint proxy statement/prospectus is presented for illustrative purposes only and may not be reflective of the operating results and financial condition of the combined company following completion of the merger.

The unaudited pro forma combined financial information in this joint proxy statement/prospectus is presented for illustrative purposes only and is not necessarily indicative of what the combined company’s actual financial position or results of operations would have been had the merger been completed on the dates indicated. The unaudited pro forma combined financial information is subject to a number of assumptions and does not take into account any synergies related to the proposed transaction. Further, the combined company’s actual results and financial position after the merger may differ materially and adversely from the unaudited pro forma combined financial data that is included in this joint proxy statement/prospectus. The unaudited pro forma combined financial information has been prepared with the expectation, as of the date of this joint proxy statement/prospectus, that Orthofix will be identified as the acquiror under GAAP and reflects adjustments based upon preliminary estimates of the fair value of assets to be acquired and liabilities to be assumed. The final acquisition accounting will be based upon the actual purchase price and the fair value of the assets and liabilities of the party that is determined to be the acquiree under GAAP as of the date of the completion of the merger. Accordingly, the final acquisition accounting may differ materially from the unaudited pro forma combined financial information reflected in this joint proxy statement/prospectus. For further discussion, see “Unaudited Pro Forma Combined Financial Information.”

 

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Orthofix’s executive officers and directors and SeaSpine’s executive officers and directors have interests in the merger that may be different from, or in addition to, Orthofix’s stockholders’ and SeaSpine’s stockholders’ interests.

When considering the recommendation of the Orthofix Board that Orthofix stockholders approve the Orthofix share issuance proposal and the recommendation of the SeaSpine Board that the SeaSpine stockholders approve the SeaSpine merger proposal, such stockholders should be aware that certain directors and executive officers of Orthofix and directors and executive officers of SeaSpine have certain interests in the merger that may be different from, or in addition to, the interests of such stockholders. The Orthofix Board was aware of the interests of Orthofix’s directors and executive officers, the SeaSpine Board was aware of the interests of SeaSpine’s directors and executive officers, and each board considered such interests, among other matters, when it approved the merger agreement and in making its recommendations to its stockholders. Additional interests of the executive officers of Orthofix in the merger include certain performance stock unit achievement rights and certain post separation cash severance and equity acceleration rights, in each case as a result of the Orthofix Board’s determination, upon completion of the merger, to treat the transaction, if consummated, as a “Change in Control” under applicable agreements and equity plans. Additional interests of the directors of Orthofix include continued service on the board of the combined company or certain equity acceleration rights in the event that the director is not continuing. Additional interests of the directors and executive officers of SeaSpine in the merger include (i) the payment of certain severance and other benefits upon a qualifying termination of employment or service following the completion of the merger, (ii) continued employment or service on the board of the combined company and (iii) the continued provision of indemnification and insurance coverage for current and former directors and executive officers of SeaSpine in accordance with the merger agreement. See the sections entitled “Interests of Orthofix’s Directors and Executive Officers in the Merger” and “Interests of SeaSpine’s Directors and Executive Officers in the Merger” for a more detailed description of these interests. As a result of these interests, these directors (as applicable) and executive officers might be more likely to support and to vote in favor of the proposals described in this joint proxy statement/prospectus than if they did not have these interests. Orthofix stockholders and SeaSpine stockholders should consider whether these interests might have influenced these directors (as applicable) and executive officers to recommend adopting the merger agreement.

Following the merger, the composition of the combined company board of directors will be different than the composition of the current Orthofix Board or the current SeaSpine Board.

The Orthofix Board currently consists of nine directors and the SeaSpine Board currently consists of nine directors. Upon completion of the merger, the board of directors of the combined company will consist of nine directors, including five directors designated by Orthofix and four directors designated by SeaSpine. See the section entitled “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — Governance of the Combined Company.” This new composition of the board of directors of the combined company may affect the future decisions of the combined company.

The opinions of Orthofix’s and SeaSpine’s financial advisors will not reflect changes in circumstances between the signing of the merger agreement and completion of the merger.

Orthofix and SeaSpine have not obtained updated opinions from their respective financial advisors as of the date of this joint proxy statement/prospectus and do not expect to receive updated opinions prior to completion of the merger. Changes in the operations and prospects of Orthofix or SeaSpine, general market and economic conditions and other factors that may be beyond the control of Orthofix or SeaSpine, and on which Orthofix’s and SeaSpine’s financial advisors’ opinions were based, may significantly alter the value of Orthofix or SeaSpine or the prices of shares of Orthofix common stock or SeaSpine common stock by the time the merger is completed. The opinions do not speak as of the time the merger will be completed or as of any date other than the date of such opinions. Because Orthofix’s and SeaSpine’s financial advisors will not be updating their opinions, the opinions will not address the fairness of the exchange ratio from a financial point of view at the time the merger is completed. The Orthofix’s board of directors’ recommendation that Orthofix stockholders vote “FOR

 

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the proposals being submitted to the Orthofix stockholders and the SeaSpine Board’s recommendation that SeaSpine stockholders vote “FOR” the proposals being submitted to the SeaSpine stockholders, however, are made as of the date of this joint proxy statement/prospectus. For a description of the opinions that Orthofix and SeaSpine received from their respective financial advisors, please refer to “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of the Share Issuance — Opinion of Orthofix’s Financial Advisor” and “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of the Share Issuance — Opinion of SeaSpine’s Financial Advisor.”

Shareholder litigation could prevent or delay the closing of the merger or otherwise negatively affect the business and operations of Orthofix and SeaSpine.

On each of November 17, 2022 and November 21, 2022, purported SeaSpine stockholders filed a complaint against SeaSpine and the members of the SeaSpine Board in the United States District Court for the Southern District of New York. The complaints assert claims under Section 14(a) of the Exchange Act and Rule 14a-9 promulgated thereunder and Section 20(a) of the Exchange Act for allegedly causing the filing with the SEC on November 8, 2022 of a materially incomplete and misleading registration statement on Form S-4. Among other remedies, the plaintiffs seek to enjoin the merger. On November 19, 2022, counsel to two different purported SeaSpine stockholders sent demand letters making similar assertions. In addition, on November 15, 2022, counsel to a purported Orthofix stockholder sent a demand letter to Orthofix’s counsel attaching a draft federal court complaint against Orthofix and the members of the Orthofix Board making similar claims under Section 14(a) of the Exchange Act and Rule 14a-9 promulgated thereunder and Section 20(a) of the Exchange Act, and also seeking to enjoin the merger. Although the ultimate outcome of these lawsuits cannot be predicted with certainty, Orthofix and SeaSpine believe the claims are without merit and intend to defend against these actions vigorously.

Securities class action lawsuits and derivative lawsuits are often brought against companies that have entered into merger agreements. Additional lawsuits against Orthofix, SeaSpine, Merger Sub and/or the directors and officers of Orthofix and/or SeaSpine in connection with the merger may be filed in the future. Neither Orthofix nor SeaSpine can assure you as to the outcome of any lawsuit that has been or may be filed, including the amount of costs associated with defending claims or any other liabilities that may be incurred in connection with such litigation. If the plaintiffs are successful in obtaining an injunction prohibiting the completion of the merger on the agreed-upon terms, then such injunction may prevent the merger from being completed, or from being completed within the expected time frame. Whether or not any plaintiff’s claim is successful, this type of litigation may result in significant costs and divert management’s attention and resources, which could adversely affect the operation of Orthofix’s and SeaSpine’s business. See “SeaSpine Proposal I: Adoption of the Merger Agreement and Orthofix Proposal I: Approval of The Share Issuance — Litigation Related to the Merger.”

Risks Related to the Combined Company

The combined company may be unable to successfully integrate the Orthofix and SeaSpine businesses and realize the anticipated benefits of the merger.

The success of the merger will depend, in part, on the combined company’s ability to successfully combine and integrate the Orthofix and SeaSpine businesses, and realize the anticipated benefits, including synergies, cost savings, innovation and technological opportunities and operational efficiencies from the merger in a manner that does not materially disrupt existing customer, supplier and employee relations and does not result in decreased revenues due to losses of, or decreases in orders by, customers. If the combined company is unable to achieve these objectives within the anticipated time frame, or at all, the anticipated benefits may not be realized fully or at all, or may take longer to realize than expected, and the value of the combined company common stock may decline. The combined company may fail to realize some or all of the anticipated benefits of the merger if the integration process takes longer than expected or is more costly than expected.

 

 

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The integration of the two companies may result in material challenges, including, without limitation:

 

   

managing a larger, more complex combined medical device business;

 

   

maintaining employee morale and retaining key management and other employees;

 

   

retaining existing business and operational relationships, including customers, suppliers and employees and other counterparties, as may be impacted by contracts containing consent and/or other provisions that may be triggered by the merger, and attracting new business and operational relationships;

 

   

consolidating corporate and administrative infrastructures and eliminating duplicative operations, including unanticipated issues in integrating information technology, communications and other systems;

 

   

coordinating geographically separate organizations; and

 

   

unforeseen expenses or delays associated with the merger.

Many of these factors will be outside of Orthofix’s and/or SeaSpine’s control, and any one of them could result in delays, increased costs, decreases in the amount of expected revenues and other adverse impacts, which could materially affect the combined company’s financial position, results of operations and cash flows.

In addition, SeaSpine completed its merger with 7D Surgical, Inc. on May 20, 2021, and the integration of the SeaSpine business and 7D Surgical, Inc. remains in process. This ongoing integration may increase the complexity of, and challenges associated with, the integration of the Orthofix and SeaSpine businesses, which may make it more difficult for Orthofix and SeaSpine to achieve the anticipated benefits of the merger fully or at all, or within the anticipated time frame.

Due to legal restrictions, Orthofix and SeaSpine are currently permitted to conduct only limited planning for the integration of the two companies following the merger. The actual integration may result in additional and unforeseen expenses, and the anticipated benefits of the integration plan may not be realized on a timely basis, if at all.

Upon completion of the merger, SeaSpine stockholders will have different rights under the combined company’s governing documents than they do currently under SeaSpine’s governing documents.

Upon completion of the merger, SeaSpine stockholders will no longer be stockholders of SeaSpine, but will instead become stockholders of the combined company and their rights as stockholders will be governed by the terms of the combined company’s certificate of incorporation and bylaws. The terms of the combined company’s certificate of incorporation and bylaws will be in some respects different than the terms of SeaSpine’s certificate of incorporation and bylaws, which currently govern the rights of SeaSpine stockholders.

For a more complete description of the different rights associated with shares of SeaSpine common stock and shares of combined company common stock, see the section entitled “Comparison of the Rights of Orthofix Stockholders and SeaSpine Stockholders.”

The future results of the combined company may be adversely impacted if the combined company does not effectively manage its complex operations following the completion of the merger.

Following the completion of the merger, the size of the combined company’s business will be significantly larger than the current size of either SeaSpine’s business or Orthofix’s business. The combined company’s ability to successfully manage this expanded business will depend, in part, upon management’s ability to design and implement strategic initiatives that address not only the integration of the Orthofix and SeaSpine businesses, but also the increased scale and scope of the combined business with its associated increased costs and complexity. There can be no assurances that the combined company will be successful in integrating the businesses or that it will realize the expected operating efficiencies, cost savings and other benefits currently anticipated from the merger.

 

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Each of Orthofix and SeaSpine expects to incur substantial expenses related to the completion of the merger and the integration of the Orthofix and SeaSpine businesses.

Each of Orthofix and SeaSpine will incur substantial expenses in connection with the completion of the merger to integrate a large number of processes, policies, procedures, operations, technologies and systems of Orthofix and SeaSpine in connection with the merger. The substantial majority of these costs will be non-recurring expenses related to the transactions and facilities and systems consolidation costs. The combined company may incur additional costs or suffer loss of business under third-party contracts that are terminated or that contain change in control or other provisions that may be triggered by the completion of the transactions, and/or losses of, or decreases in orders by, customers, and may also incur costs to retain certain key management personnel and employees. Orthofix and SeaSpine will also incur transaction fees and costs related to formulating integration plans for the combined business, and the execution of these plans may lead to additional unanticipated costs and time delays. These incremental transaction-related costs may exceed the savings the combined company expects to achieve from the elimination of duplicative costs and the realization of other efficiencies related to the integration of the businesses, particularly in the near term and in the event there are material unanticipated costs. Factors beyond the parties’ control could affect the total amount or timing of these expenses, many of which, by their nature, are difficult to estimate accurately.

The market price of the combined company common stock after the merger is completed may be affected by factors different from those affecting the price of Orthofix common stock or SeaSpine common stock before the merger is completed.

Upon completion of the merger, holders of Orthofix common stock and holders of SeaSpine common stock will be holders of common stock of the combined company. As the businesses of Orthofix and SeaSpine are different, the results of operations, as well as the price of the combined company common stock, may, in the future, be affected by factors different from those factors affecting each of Orthofix and SeaSpine as an independent stand-alone company. The combined company will face additional risks and uncertainties to which each of Orthofix and SeaSpine may currently not be exposed. As a result, the market price of the combined company’s shares may fluctuate significantly following completion of the merger. For a discussion of the Orthofix business and SeaSpine business and of some important factors to consider in connection with those businesses, see the documents incorporated by reference into this joint proxy statement/prospectus and referred to under “Where You Can Find More Information.”

The market price of the combined company common stock may decline as a result of the merger, including as a result of some Orthofix and/or SeaSpine stockholders adjusting their portfolios.

The market price of the combined company common stock may decline as a result of the merger if, among other things, the operational cost savings estimates in connection with the integration of the Orthofix and SeaSpine businesses are not realized, there are unanticipated negative impacts on Orthofix’s financial position, or if the transaction costs related to the merger are greater than expected. The market price also may decline if the combined company does not achieve the perceived benefits of the merger as rapidly or to the extent anticipated by financial or industry analysts or if the effect of the transactions on the combined company’s financial position, results of operations or cash flows is not consistent with the expectations of financial or industry analysts.

In addition, sales of combined company common stock after the completion of the merger may cause the market price of such common stock to decrease. Based on the number of shares of SeaSpine common stock outstanding and reserved for issuance, Orthofix expects to issue an aggregate of approximately 16.6 million shares of Orthofix common stock to holders of SeaSpine common stock in the merger. This estimate is based on the number of outstanding shares of SeaSpine common stock as of October 7, 2022, including share equity awards and exchangeable shares but excluding outstanding options (as such options are not currently expected to be exercised prior to closing given the applicable exercise prices). SeaSpine stockholders may decide not to hold the shares of combined company common stock they will receive in the merger. Certain SeaSpine stockholders,

 

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such as funds with limitations on their permitted holdings of stock in individual issuers, may be required to sell the shares of combined company common stock that they receive in the merger. Orthofix stockholders may decide not to continue to hold their shares of common stock following completion of the merger. Certain Orthofix stockholders, such as funds with limitations on their permitted holdings of stock in individual issuers, may be required to sell their shares of common stock following completion of the merger. Such sales of combined company common stock could have the effect of depressing the market price for the combined company common stock.

Any of these events may make it more difficult for the combined company to sell equity or equity-related securities, dilute your ownership interest in the combined company and have an adverse impact on the price of the combined company common stock.

Other Risk Factors

Orthofix’s and SeaSpine’s businesses are and will be subject to the risks described above. In addition, Orthofix and SeaSpine are, and will continue to be, subject to the risks described in, as applicable, the Orthofix Annual Report on Form 10-K for the year ended December  31, 2021, and the SeaSpine Annual Report on Form 10-K for the year ended December 31, 2021, as may be updated by subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, all of which are filed with the SEC and incorporated by reference into this joint proxy statement/prospectus. See “Where You Can Find More Information” for the location of information incorporated by reference into this joint proxy statement/prospectus.

 

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in, or incorporated by reference into, this joint proxy statement/prospectus, to the extent they are not statements of historical or present fact, constitute “forward-looking statements” under the securities laws. From time to time, oral or written forward-looking statements may also be included in other information released to the public. These forward-looking statements are intended to provide SeaSpine’s and Orthofix’s respective management’s current expectations or plans for Orthofix’s, SeaSpine’s, or the combined company’s future operating and financial performance, based on assumptions currently believed to be valid. Forward-looking statements can be identified by the use of words such as “believe,” “expect,” “expectations,” “plans,” “strategy,” “prospects,” “estimate,” “project,” “target,” “anticipate,” “will,” “should,” “see,” “guidance,” “outlook,” “confident,” “on track” and other words of similar meaning. Forward-looking statements may include, among other things, statements relating to future sales, earnings, cash flow, results of operations, uses of cash, share repurchases, tax rates, research and development, referred to as R&D, spend, other measures of financial performance, potential future plans, strategies or transactions, credit ratings and net indebtedness, other anticipated benefits of the merger, including estimated synergies and customer cost savings resulting from the merger, the expected timing of completion of the merger, estimated costs associated with such transactions, the composition of the combined company Board, the expected management team, and other statements that are not historical facts. All forward-looking statements involve risks, uncertainties and other factors that may cause actual results to differ materially from those expressed or implied in the forward-looking statements. For those statements, we claim the protection of the safe harbor for forward-looking statements contained in the U.S. Private Securities Litigation Reform Act of 1995. Such risks, uncertainties and other factors include, without limitation:

 

   

negative effects of the announcement or pendency of the merger on the market price of Orthofix’s and/or SeaSpine’s respective common stock and/or on their respective financial performance;

 

   

the ability of the parties to receive the required regulatory approvals for the merger (and the risk that such approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the transaction) and approvals of Orthofix’s stockholders and SeaSpine’s stockholders and to satisfy the other conditions to the completion of the merger on a timely basis or at all;

 

   

the occurrence of events that may give rise to a right of one or both of the parties to terminate the merger agreement;

 

   

risks relating to the value of the Orthofix shares to be issued in the merger, significant transaction costs and/or unknown liabilities;

 

   

the possibility that the anticipated benefits, including technological innovation and cost synergies, from the merger cannot be realized in full or at all or may take longer to realize than expected, including risks associated with third-party contracts containing consent and/or other provisions that may be triggered by the proposed transaction;

 

   

risks associated with transaction-related litigation;

 

   

the risk that the integration between the Orthofix and SeaSpine businesses may be more difficult, time-consuming or costly than expected;

 

   

the ability of each of SeaSpine, Orthofix, and the combined company to retain and hire key personnel;

 

   

the intended qualification of the merger as a tax-free reorganization for U.S. federal income tax purposes;

 

   

the impact of the merger on the respective businesses of SeaSpine and Orthofix, including the impact on relationships of the combined company with customers, suppliers, employees and other business counterparties;

 

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the scope, nature, impact or timing of the merger;

 

   

the effect of economic conditions in the industries and markets in which Orthofix and SeaSpine operate in the United States and globally and any changes therein, including financial market conditions, fluctuations in commodity prices, interest rates and foreign currency exchange rates, levels of end-market demand, the impact of weather conditions and natural disasters, and the financial condition of Orthofix’s and SeaSpine’s customers and suppliers;

 

   

challenges in the development, production, delivery, support, performance and realization of the anticipated benefits (including expected returns under customer contracts) of advanced technologies and new products and services;

 

   

future availability of credit and factors that may affect such availability, including credit market conditions and capital structure;

 

   

delays and disruption in delivery of materials and services from suppliers;

 

   

company cost reduction efforts, restructuring costs and savings and other consequences thereof;

 

   

new business and investment opportunities;

 

   

the ability to realize the intended benefits of organizational changes;

 

   

the anticipated benefits of diversification and balance of operations across product lines, regions and industries;

 

   

the outcome of legal proceedings, investigations and other contingencies;

 

   

the effect of changes in political conditions in the U.S. and other countries in which Orthofix, SeaSpine and the businesses of each operate on general market conditions, global trade policies and currency exchange rates in the near term and beyond;

 

   

the effect of changes in tax, healthcare, regulatory and other laws and regulations in the United States and other countries in which Orthofix, SeaSpine and the businesses of each operate; and

 

   

other risk factors as detailed from time to time in Orthofix’s and SeaSpine’s reports filed with the SEC, including Orthofix’s and SeaSpine’s respective Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other documents filed with the SEC, including the risks and uncertainties set forth in or incorporated by reference into this joint proxy statement/prospectus in the section entitled “Risk Factors.”

A detailed discussion of risks related to the merger, the combined company’s business, Orthofix’s business and SeaSpine’s business is included below under the heading “Risk Factors” beginning on page 33 of this joint proxy statement/prospectus. There can be no assurance that the merger or any other transaction described in this joint proxy statement/prospectus will in fact be completed in the manner described or at all. Any forward-looking statement speaks only as of the date on which it is made, and Orthofix and SeaSpine assume no obligation to update or revise such statement, whether as a result of new information, future events or otherwise, except as required by applicable law. Readers are cautioned not to place undue reliance on any of these forward-looking statements. See “Where You Can Find More Information” beginning on page 192 of this joint proxy statement/prospectus.

 

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THE PARTIES TO THE MERGER

Orthofix Medical Inc.

Orthofix is a global medical device company with a spine and orthopedics focus. Orthofix’s mission is to deliver innovative, quality-driven solutions while partnering with health care professionals to improve patient mobility. Headquartered in Lewisville, Texas, Orthofix’s spine and orthopedic products are distributed in more than 60 countries via its sales representatives and distributors. Orthofix manages its business by its two reporting segments, Global Spine and Global Orthopedics, which accounted for 77% and 23%, respectively, of its total net sales in 2021.

Within the Global Spine segment, Orthofix provides implantable medical devices, biologics, and other regenerative solutions which aim to restore the quality of life of patients suffering from diseases and traumas of the spine. Orthofix offers a variety of treatment solutions that uniquely incorporate multiple treatment modalities, such as mechanical, biological, and electromagnetic modes, to achieve desired clinical outcomes.

The Global Orthopedics reporting segment offers products and solutions that allow physicians to successfully treat a variety of orthopedic conditions unrelated to the spine. This reporting segment specializes in the design, development, and marketing of orthopedic products used in fracture repair, deformity correction, and bone reconstruction procedures. Orthofix distributes these products through a global network of distributors and sales representatives to sell its orthopedic products to hospitals and healthcare providers.

Orthofix has administrative and training facilities in the U.S., Italy, Brazil, U.K., France, and Germany, and manufacturing facilities in the U.S. and Italy. Orthofix directly distributes products in the U.S., Italy, the U.K., Germany, and France. In several of these and other markets, Orthofix also distributes its products through independent distributors.

Orthofix originally was formed in 1987 in Curaçao as “Orthofix International N.V.” In 2018, Orthofix completed a change in its jurisdiction of organization from Curaçao to the State of Delaware and changed its name to “Orthofix Medical Inc.” As a result, it is now a corporation existing under the laws of the State of Delaware.

Orthofix’s principal executive offices are located at 3451 Plano Parkway, Lewisville, Texas 75056, and its telephone number is (214) 937-2000. Orthofix’s website address is www.orthofix.com. Information contained on Orthofix’s website does not constitute part of this joint proxy statement/prospectus. Orthofix’s stock is publicly traded on Nasdaq under the ticker symbol “OFIX.” Additional information about Orthofix is included in documents incorporated by reference in this joint proxy statement/prospectus. Please see the section entitled “Where You Can Find More Information.”

SeaSpine Holdings Corporation

SeaSpine is a global medical technology company focused on the design, development and commercialization of surgical solutions for the treatment of patients suffering from spinal disorders. SeaSpine has a comprehensive portfolio of orthobiologics and spinal implant solutions, as well as a surgical navigation system, to meet the varying combinations of products that neurosurgeons and orthopedic spine surgeons need to perform fusion procedures in the lumbar, thoracic and cervical spine. SeaSpine believes this broad combined portfolio is essential to meet the “complete solution” requirements of these surgeons. SeaSpine reports revenue in two product categories: (i) orthobiologics and (ii) spinal implants and enabling technologies. SeaSpine’s orthobiologics products consist of a broad range of advanced and traditional bone graft substitutes designed to improve bone fusion rates following a wide range of orthopedic surgeries, including spine, hip, and extremities procedures. SeaSpine’s spinal implants and enabling technologies portfolio consists of an extensive line of products and image-guided surgical solutions to facilitate spinal fusion in degenerative, minimally invasive

 

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surgery (MIS), and complex spinal deformity procedures. Expertise in orthobiologic sciences and spinal implants, software and advanced optics product development allows SeaSpine to offer surgeon customers a differentiated portfolio and a complete solution to meet their patients’ fusion requirements. SeaSpine currently markets its products in the United States and in approximately 30 countries worldwide.

SeaSpine was incorporated in Delaware on February 12, 2015. Its principal executive offices are at 5770 Armada Drive, Carlsbad, California, and its telephone number is (760) 727-8399. SeaSpine’s website address is www.seaspine.com. Information contained on SeaSpine’s website does not constitute part of this joint proxy statement/prospectus. SeaSpine’s stock is publicly traded on Nasdaq under the ticker symbol “SPNE.” Additional information about SeaSpine is included in documents incorporated by reference in this joint proxy statement/prospectus. Please see the section entitled “Where You Can Find More Information.”

Orca Merger Sub Inc.

Orca Merger Sub Inc., a wholly owned subsidiary of Orthofix, is a Delaware corporation incorporated on October 7, 2022, for the purpose of effecting the merger. Orca Merger Sub Inc. has not conducted any activities other than those incidental to its formation and the matters contemplated by the merger agreement. The principal executive offices of Orca Merger Sub Inc. are located at 3451 Plano Parkway, Lewisville, Texas 75056, and its telephone number is (214) 937-2000.

 

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THE ORTHOFIX SPECIAL MEETING

This joint proxy statement/prospectus is being provided to Orthofix stockholders as part of a solicitation of proxies by the Orthofix Board for use at the Orthofix special meeting to be held at the time and place specified below and at any properly convened meeting following an adjournment or postponement thereof. This joint proxy statement/prospectus provides Orthofix stockholders with information they need to know to be able to vote or instruct their vote to be cast at the Orthofix special meeting.

Date, Time and Place

The Orthofix special meeting will be held at Hampton Inn & Suites, 3650 Plano Pkwy, The Colony, TX 75056 on January 4, 2023, at 11 a.m. Central Time. Orthofix intends to mail this joint proxy statement/prospectus and the enclosed form of proxy to its stockholders entitled to vote at the Orthofix special meeting on or about November 23, 2022.

Purpose of the Orthofix Special Meeting

At the Orthofix special meeting, Orthofix stockholders will be asked to consider and vote on the following:

 

  1.

Approval of the Orthofix Share Issuance. To vote on a proposal to approve the issuance of Orthofix common stock, par value $0.10 per share, to SeaSpine stockholders in connection with the merger contemplated by the merger agreement; and

 

  2.

Adjournment of the Orthofix Special Meeting. To vote on a proposal to approve the adjournment of the Orthofix special meeting to a later date or dates, if necessary or appropriate, to solicit additional proxies in the event there are not sufficient votes at the time of the Orthofix special meeting to approve the Orthofix share issuance proposal.

Completion of the merger is conditioned on the approval of the Orthofix share issuance proposal.

Recommendation of the Orthofix Board

On October 10, 2022, the Orthofix Board unanimously approved and declared advisable the merger agreement and the transactions contemplated by the merger agreement, including the issuance of Orthofix common shares in the merger, on the terms and subject to the conditions set forth in the merger agreement, and determined that the merger agreement and the transactions contemplated by the merger agreement, including the issuance of Orthofix common shares in the merger, are advisable and fair to and in the best interests of, Orthofix and its stockholders. Accordingly, the Orthofix Board unanimously recommends that Orthofix stockholders vote “FOR” the Orthofix share issuance proposal and “FOR” the Orthofix adjournment proposal.

Orthofix stockholders should carefully read this joint proxy statement/prospectus, including any documents incorporated by reference, and the annexes in their entirety for more detailed information concerning the merger and the other transactions contemplated by the merger agreement.

Orthofix Record Date; Orthofix Stockholders Entitled to Vote

Only holders of record of Orthofix common stock at the close of business on November 10, 2022, the Orthofix record date, will be entitled to notice of, and to vote at, the Orthofix special meeting or any adjournments or postponements thereof.

As of the close of business on the Orthofix record date, there were 20,011,598 shares of Orthofix common stock outstanding and entitled to vote at the Orthofix special meeting. Each share of Orthofix common stock outstanding on the Orthofix record date entitles the holder thereof to one vote on each proposal to be considered at the Orthofix special meeting, in person or by proxy through the Internet or by telephone or by a properly executed and delivered proxy with respect to the Orthofix special meeting.

 

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Your vote is important. We expect that many Orthofix stockholders will not attend the Orthofix special meeting in person, and instead will be represented by proxy. Most Orthofix stockholders have a choice of voting over the Internet, by using a toll-free telephone number, or by returning a completed Orthofix proxy card or voting instruction form. Please check your notice, proxy card or the information forwarded by your broker, bank or other holder of record to see which options are available to you. The Internet and telephone voting procedures have been designed to authenticate Orthofix stockholders, to allow you to vote your shares, and to confirm that your instructions have been properly recorded. The Internet and telephone voting facilities for Orthofix stockholders of record will close at the start of the Orthofix special meeting at 11 a.m. Central Time on January 4, 2023. If your shares are held through a broker, bank or other holder of record and Internet or telephone facilities are made available to you, these facilities may close sooner than those for Orthofix stockholders of record.

You can revoke your proxy at any time before it is exercised by delivering a properly executed, later-dated proxy (including an Internet or telephone vote) or by voting by ballot at the Orthofix special meeting. Executing your proxy in advance will not limit your right to vote at the Orthofix special meeting if you decide to attend in person. However, if your shares are held in the name of a broker, bank or other holder of record, you cannot vote at the Orthofix special meeting unless you have a legal proxy, executed in your favor, from the holder of record.

All shares entitled to vote and represented by properly executed proxies received prior to the Orthofix special meeting and not revoked will be voted at the Orthofix special meeting in accordance with your instructions. If you sign and return your proxy but do not indicate how your shares should be voted on a proposal, the shares represented by your proxy will be voted as the Orthofix Board recommends for such proposal.

A complete list of Orthofix stockholders entitled to vote at the Orthofix special meeting will be available for examination by any Orthofix stockholder in the Corporate Secretary’s Office at Orthofix Medical Inc., 3451 Plano Parkway, Lewisville, Texas 75056 for purposes pertaining to the Orthofix special meeting, during ordinary business hours for a period of ten days before the Orthofix special meeting, and at the time and place of the Orthofix special meeting.

Voting by Orthofix’s Directors and Executive Officers

As of the close of business on November 10, 2022, the most recent practicable date for which such information was available, directors and executive officers of Orthofix and their affiliates owned and were entitled to vote 211,519 shares (or approximately 1.1%) of Orthofix common stock. It is currently expected that Orthofix’s directors and executive officers will vote their shares of Orthofix common stock in favor of each of the proposals to be considered at the Orthofix special meeting, although none of them have entered into any agreement obligating them to do so. For information with respect to Orthofix common stock owned by directors and executive officers of Orthofix, please see the section entitled “Orthofix Beneficial Ownership Table.”

Quorum

The Orthofix bylaws provide that the presence at the Orthofix special meeting, in person or represented by proxy, of the holders of a majority of the aggregate the voting power of the Orthofix common stock outstanding and entitled to vote at the meeting as of the Orthofix record date constitutes a quorum for the transaction of business at the Orthofix special meeting.

Abstentions will count for the purpose of determining the presence of a quorum for the transaction of business at the Orthofix special meeting.

Broker non-votes, if any, will not be counted for the purpose of determining the presence of a quorum for the transaction of business at the Orthofix special meeting.

 

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Required Vote

The required votes to approve the Orthofix proposals are as follows:

 

   

The Orthofix share issuance proposal requires the affirmative vote of a majority in voting power of the shares of Orthofix common stock present in person or represented by proxy at the Orthofix special meeting and entitled to vote on the proposal.

 

   

The Orthofix adjournment proposal requires the affirmative vote of a majority in voting power of the shares of Orthofix common stock present in person or represented by proxy at the Orthofix special meeting and entitled to vote on the proposal.

Voting of Proxies by Holders of Record

If you were the record holder of your Orthofix shares as of the Orthofix record date, you may submit your proxy to vote by mail, by telephone or via the Internet.

Voting via the Internet or by Telephone

 

   

To submit your proxy via the Internet, go to www.proxypush.com/OFIX. Have your Orthofix proxy card in hand when you access the website and follow the instructions to vote your shares.

 

   

To submit your proxy by telephone, call (866) 240-4561. Have your Orthofix proxy card in hand when you call and then follow the instructions to vote your shares.

 

   

If you vote via the Internet or by telephone, you must do so before the start of the Orthofix special meeting at 11 a.m. Central Time on January 4, 2023.

Voting by Mail

As an alternative to submitting your proxy via the Internet or by telephone, you may submit your proxy by mail.

 

   

To submit your proxy by mail, simply mark, sign and date your Orthofix proxy card and return it in the pre-paid envelope that has been provided, or in an envelope addressed to: Mediant, P.O. Box 8016, Cary, NC 27512-9903.

 

   

If you vote by mail, your Orthofix proxy card must be received no later than 5 p.m. Eastern Time on January 3, 2023.

General

Please be aware that any costs related to voting via the Internet, such as Internet access charges, will be your responsibility.

All properly signed proxies that are timely received and that are not revoked will be voted at the Orthofix special meeting according to the instructions indicated on the proxies or, if no direction is indicated, they will be voted as recommended by the Orthofix Board.

Treatment of Abstentions; Failure to Vote

For purposes of the Orthofix special meeting, an abstention occurs when an Orthofix stockholder attends the Orthofix special meeting, either in person or by proxy, but abstains from voting. For each of the Orthofix share issuance proposal and the Orthofix adjournment proposal, if an Orthofix stockholder present in person at the Orthofix special meeting abstains from voting, or responds by proxy with an “abstain” vote, it will have the same effect as a vote

 

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cast “AGAINST” such proposal. If an Orthofix stockholder is not present in person at the Orthofix special meeting and does not respond by proxy, it will have no effect on the vote count for such proposal.

Shares Held in Street Name

If your shares of Orthofix common stock are held in an account at a bank, broker or other nominee holder of record (i.e., in “street name”), you must provide the record holder of your shares with instructions on how to vote the shares. Please follow the voting instructions provided by the bank, broker or other nominee. You may not vote shares held in street name by returning an Orthofix proxy card directly to Orthofix or by voting in person at the Orthofix special meeting unless you provide a “legal proxy,” which you must obtain from your bank, broker or other nominee. Further, banks, brokers or other nominees who hold shares of Orthofix common stock on behalf of their customers may not give a proxy to Orthofix to vote those shares with respect to the Orthofix share issuance proposal and the Orthofix adjournment proposal without specific instructions from their customers, as banks, brokers and other nominees do not have discretionary voting power on these “non-routine” matters. Under current rules, each of the proposals to be considered at the Orthofix special meeting as described in this joint proxy statement/prospectus are considered non-routine. Therefore banks, brokers and other nominee holders of record do not have discretionary authority to vote on any of the proposals to be considered at the Orthofix special meeting. Broker non-votes occur when a broker or nominee is not instructed by the beneficial owner of shares to vote on a particular proposal for which the broker does not have discretionary voting power.

Therefore, if you are an Orthofix stockholder and you do not instruct your bank, broker or other nominee on how to vote your shares, your bank, broker or other nominee may not vote your shares on the Orthofix share issuance proposal or the Orthofix adjournment proposal, which broker non-votes, if any, will have no effect on the vote count for such proposal.

Attendance at the Orthofix Special Meeting and Voting in Person

You or your authorized proxy may attend the Orthofix special meeting if you were a registered or beneficial stockholder of Orthofix common stock as of the Orthofix record date.

You will need to obtain an admission ticket in advance to attend the Orthofix special meeting. To do so, please make your request by mail to Orthofix Investor Relations, 3451 Plano Parkway, Lewisville, Texas 75056, or by email at MergerInfo@Orthofix.com. Orthofix Investor Relations must receive your request for an admission ticket on or before 11:59 p.m. Central Time on January 2, 2023. Seating will be limited and requests for tickets will be processed in the order in which they are received.

If you own shares in “street name” through an account with a bank, broker or other nominee, then send proof of your Orthofix share ownership as of the Orthofix record date (for example, a brokerage firm account statement or a “legal proxy” from your intermediary) along with your ticket request. If you are not sure what proof to send, check with your intermediary.

If your shares are registered in your name with Orthofix’s stock registrar and transfer agent, Computershare, no proof of ownership is required because Orthofix can verify your ownership.

For security reasons, be prepared to show a form of government-issued photo identification when presenting your ticket for admission to the Orthofix special meeting. If you forget to bring your ticket, you will be admitted only if you provide photo identification. If you do not request a ticket in advance, you will be admitted only if space is available and you provide photo identification and satisfactory evidence that you were a stockholder of Orthofix common stock as of the Orthofix record date. If you need special assistance at the Orthofix special meeting because of a disability, please contact Orthofix Investor Relations.

If you are a stockholder of record and plan to attend the Orthofix special meeting and wish to vote in person, you will be given a ballot at the Orthofix special meeting. Please note, however, that if your shares are held of record by a bank, broker or other nominee, and you wish to vote in person at the Orthofix special meeting, you

 

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must bring to the Orthofix special meeting a legal proxy from the record holder of the shares (your bank, broker or other nominee) authorizing you to vote at the Orthofix special meeting.

No cameras, recording equipment, electronic devices, large bags, briefcases or packages will be permitted in the Orthofix special meeting.

Revocability of Proxies

Any Orthofix stockholder of record giving a proxy has the power to revoke it. If you are an Orthofix stockholder of record, you may revoke your proxy in any of the following ways:

 

   

By delivering, before the close of business on January 3, 2023, to Orthofix’s Corporate Secretary (at Orthofix’s executive offices at 3451 Plano Parkway, Lewisville, Texas 75056) a signed written notice of revocation bearing a later date than the proxy, stating that the proxy is revoked (i.e., your most recent duly submitted voting instructions will be followed);

 

   

By duly executing a subsequently dated proxy relating to the same shares of Orthofix common stock and delivering it to Orthofix’s Corporate Secretary at the address in the bullet point above (i.e., your most recent duly submitted voting instructions will be followed) before the close of business on January 3, 2023;

 

   

By duly submitting a subsequently dated proxy relating to the same shares of Orthofix common stock by telephone or via the Internet (i.e., your most recent duly submitted voting instructions will be followed) before the start of the Orthofix special meeting at 11 a.m. Central Time on January 4, 2023; or

 

   

By attending the Orthofix special meeting in person and voting such shares during the Orthofix special meeting as described above, although attendance at the Orthofix special meeting will not, by itself, revoke a proxy.

If your shares are held by a bank, broker or other nominee, you may change your vote by submitting new voting instructions to your bank, broker or other nominee, or applicable plan administrator. You must contact your bank, broker or other nominee, or applicable plan administrator to find out how to do so.

Solicitation of Proxies; Expenses of Solicitation

The Orthofix Board is soliciting proxies for the Orthofix special meeting from its stockholders. Orthofix will bear a portion of the cost of the solicitation of proxies, including preparation, assembly and delivery, as applicable, of this joint proxy statement/prospectus, the Orthofix proxy card and any additional materials furnished to Orthofix stockholders. Proxies may be solicited by directors, officers and a small number of Orthofix’s regular employees by mail, email, in person and by telephone, but such persons will not receive any additional compensation for these activities. Orthofix has retained Saratoga Proxy Consulting LLC, a proxy solicitation firm, to assist in the solicitation of proxies for a fee of approximately $75,000 plus reasonable out-of-pocket costs and expenses. As appropriate, copies of solicitation material will be furnished to brokerage houses, fiduciaries and custodians that hold shares of Orthofix common stock of record for beneficial owners for forwarding to such beneficial owners. Orthofix may also reimburse persons representing beneficial owners for their costs of forwarding the solicitation material to such owners.

Assistance

If you need assistance with voting via the Internet, voting by telephone or completing your Orthofix proxy card, or have questions regarding the Orthofix special meeting, please contact Saratoga Proxy Consulting LLC, the proxy solicitor for Orthofix, at (212) 257-1311 or (888) 368-0379.

Your vote is very important regardless of the number of shares of Orthofix common stock that you own and the matters to be considered at the Orthofix special meeting are of great importance to the stockholders of Orthofix.

 

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Accordingly, you are urged to read and carefully consider the information contained in or incorporated by reference into this joint proxy statement/prospectus and submit your proxy via the Internet or by telephone or complete, date, sign and promptly return the enclosed Orthofix proxy card in the enclosed postage-paid envelope. If you submit your proxy via the Internet or by telephone, you do not need to return the enclosed Orthofix proxy card.

Please vote your shares via the Internet or by telephone, or sign, date and return an Orthofix proxy card promptly to ensure that your shares can be represented, even if you otherwise plan to attend the Orthofix special meeting in person.

Tabulation of Votes

Orthofix has appointed Douglas Rice to serve as the Inspector of Election for the Orthofix special meeting. Broadridge will independently tabulate affirmative and negative votes and abstentions.

Adjournments

Subject to certain restrictions contained in the merger agreement, the Orthofix special meeting may be adjourned to allow additional time for obtaining additional proxies. No notice of an adjourned meeting need be given if the time and place (if any) thereof, and the means of remote communication (if any) by which stockholders and proxyholders may be deemed present in person and vote as such adjourned meeting, are announced at the Orthofix special meeting at which the adjournment was taken unless:

 

   

the adjournment is for more than 30 days, in which case a notice of the adjourned meeting will be given to each Orthofix stockholder of record entitled to vote at the Orthofix special meeting; or

 

   

if, after the adjournment, a new record date for determination of Orthofix stockholders entitled to vote is fixed for the adjourned meeting, in which case the Orthofix Board will fix as the record date for determining Orthofix stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of Orthofix stockholders entitled to vote at the adjourned meeting, and will give notice of the adjourned meeting to each Orthofix stockholder of record as of such record date.

At any adjourned meeting, all proxies will be voted in the same manner as they would have been voted at the original convening of the Orthofix special meeting, except for any proxies that have been effectively revoked or withdrawn prior to the adjourned meeting.

 

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THE SEASPINE SPECIAL MEETING

This joint proxy statement/prospectus is being provided to the SeaSpine stockholders as part of a solicitation of proxies by the SeaSpine Board for use at the SeaSpine special meeting to be held at the time and place specified below and at any properly convened meeting following an adjournment or postponement thereof. This joint proxy statement/prospectus provides SeaSpine stockholders with information they need to know to be able to vote or instruct their vote to be cast at the SeaSpine special meeting.

Date, Time and Place

The SeaSpine special meeting will be held at the offices of DLA Piper LLP (US), 4365 Executive Drive, 4th Floor, San Diego, CA 92121 on January 4, 2023, at 9 a.m. Pacific Time. SeaSpine intends to mail this joint proxy statement/prospectus and the enclosed form of proxy to its stockholders entitled to vote at the SeaSpine special meeting on or about November 23, 2022.

Purpose of the SeaSpine Special Meeting

At the SeaSpine special meeting, SeaSpine stockholders will be asked to consider and vote on the following:

 

  1.

Adoption of the Merger Agreement. To vote on a proposal to adopt the merger agreement, which is further described in the section entitled “The Merger Agreement,” and a copy of which merger agreement is attached as Annex A to this joint proxy statement/prospectus;

 

  2.

SeaSpine Merger-Related Compensation. To vote on a proposal to approve, by advisory (non-binding) vote, certain compensation arrangements that may be paid or become payable to SeaSpine’s named executive officers in connection with the merger contemplated by the merger agreement; and

 

  3.

Adjournment of the SeaSpine Special Meeting. To vote on a proposal to approve the adjournment of the SeaSpine special meeting to a later date or dates, if necessary or appropriate, to solicit additional proxies in the event there are not sufficient votes at the time of the SeaSpine special meeting to approve the SeaSpine merger proposal.

Completion of the merger is conditioned on the approval of the SeaSpine merger proposal.

Recommendation of the SeaSpine Board

On October 10, 2022, the SeaSpine Board unanimously approved and declared advisable the merger agreement and the transactions contemplated by the merger agreement, including the merger, and determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger, are fair to and in the best interests of SeaSpine and its stockholders. Accordingly, the SeaSpine Board unanimously recommends that SeaSpine stockholders vote “FOR” the SeaSpine merger proposal, “FOR” the SeaSpine merger-related compensation proposal and “FOR” the SeaSpine adjournment proposal.

SeaSpine stockholders should carefully read this joint proxy statement/prospectus, including any documents incorporated by reference, and the annexes in their entirety for more detailed information concerning the merger and the other transactions contemplated by the merger agreement.

SeaSpine Record Date; SeaSpine Stockholders Entitled to Vote

Only holders of record of SeaSpine common stock at the close of business on November 10, 2022, the SeaSpine record date, will be entitled to notice of, and to vote at, the SeaSpine special meeting or any adjournments or postponements thereof.

 

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As of the close of business on the SeaSpine record date, there were 37,755,164 shares of SeaSpine common stock outstanding and entitled to vote at the SeaSpine special meeting. Each share of SeaSpine common stock outstanding on the SeaSpine record date entitles the holder thereof to one vote on each proposal to be considered at the SeaSpine special meeting, in person or by proxy through the Internet or by telephone or by a properly executed and delivered proxy with respect to the SeaSpine special meeting.

Your vote is important. We expect that many SeaSpine stockholders will not attend the SeaSpine special meeting in person, and instead will be represented by proxy. Most SeaSpine stockholders have a choice of voting over the Internet, by using a toll-free telephone number, or by returning a completed proxy card or voting instruction form. Please check your notice, proxy card or the information forwarded by your broker, bank or other holder of record to see which options are available to you. The Internet and telephone voting procedures have been designed to authenticate stockholders, to allow you to vote your shares, and to confirm that your instructions have been properly recorded. The Internet and telephone voting facilities for SeaSpine stockholders of record will close at 11:59 p.m. Eastern Time on January 3, 2023. If your shares are held through a broker, bank or other holder of record and Internet or telephone facilities are made available to you, these facilities may close sooner than those for SeaSpine stockholders of record.

You can revoke your proxy at any time before it is exercised by delivering a properly executed, later-dated proxy (including an Internet or telephone vote) or by voting by ballot at the SeaSpine special meeting. Executing your proxy in advance will not limit your right to vote at the SeaSpine special meeting if you decide to attend in person. However, if your shares are held in the name of a broker, bank or other holder of record, you cannot vote at the SeaSpine special meeting unless you have a legal proxy, executed in your favor, from the holder of record.

All shares entitled to vote and represented by properly executed proxies received prior to the SeaSpine special meeting and not revoked will be voted at the SeaSpine special meeting in accordance with your instructions. If you sign and return your proxy but do not indicate how your shares should be voted on a proposal, the shares represented by your proxy will be voted as the SeaSpine Board recommends for such proposal.

A complete list of SeaSpine stockholders entitled to vote at the SeaSpine special meeting will be available for examination by any SeaSpine stockholder in the Investor Relations Department at SeaSpine’s corporate office at 5770 Armada Drive, Carlsbad, California 92008 for purposes pertaining to the SeaSpine special meeting, during ordinary business hours for a period of ten days before the SeaSpine special meeting, and at the time and place of the SeaSpine special meeting.

Voting by SeaSpine’s Directors and Executive Officers

As of the close of business on November 10, 2022, the most recent practicable date for which such information was available, directors and executive officers of SeaSpine and its affiliates owned and were entitled to vote 1,398,440 shares (or approximately 3.7%) of SeaSpine common stock. It is currently expected that SeaSpine’s directors and executive officers will vote their shares of common stock in favor of each of the proposals to be considered at the SeaSpine special meeting, although none of them have entered into any agreement obligating them to do so. For information with respect to SeaSpine common stock owned by directors and executive officers of SeaSpine, please see the section entitled “SeaSpine Beneficial Ownership Table.”

Quorum

The SeaSpine bylaws provide that the presence at the SeaSpine special meeting, in person or by proxy, of holders representing a majority in voting power of the shares of the SeaSpine common stock outstanding and entitled to vote at the meeting as of the SeaSpine record date constitutes a quorum for the transaction of business at the SeaSpine special meeting.

 

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Abstentions will count for the purpose of determining the presence of a quorum for the transaction of business at the SeaSpine special meeting.

Broker non-votes, if any, will not be counted for the purpose of determining the presence of a quorum for the transaction of business at the SeaSpine special meeting.

Required Vote

The required votes to approve the SeaSpine proposals are as follows:

 

   

The SeaSpine merger proposal requires the affirmative vote of the holders of a majority of the shares of SeaSpine common stock outstanding as of the SeaSpine record date and entitled to vote on the proposal.

 

   

The SeaSpine merger-related compensation proposal requires the affirmative vote of holders of a majority of the voting power of the shares of SeaSpine common stock entitled to vote on the proposal represented in person or by proxy. Because the vote on the SeaSpine merger-related compensation proposal is advisory only, it will not be binding on either SeaSpine or Orthofix.

Accordingly, if the SeaSpine merger proposal is approved and the merger is completed, the SeaSpine merger-related compensation will be payable to SeaSpine’s named executive officers, subject only to the conditions applicable thereto, regardless of the outcome of the approval of the SeaSpine merger-related compensation proposal.

 

   

The SeaSpine adjournment proposal requires the affirmative vote of the holders of a majority of the voting power of the shares of SeaSpine common stock entitled to vote on the proposal represented in person or by proxy.

Voting of Proxies by Holders of Record

If you were the record holder of your SeaSpine shares as of the SeaSpine record date, you may submit your proxy to vote by mail, by telephone or via the Internet. For additional information, please see the section entitled “The SeaSpine Special Meeting-SeaSpine Record Date; SeaSpine Stockholders Entitled to Vote.”

Voting via the Internet or by Telephone

 

   

To submit your proxy via the Internet, go to www.proxypush.com/SPNE. Have your SeaSpine proxy card in hand when you access the website and follow the instructions to vote your shares.

 

   

To submit your proxy by telephone, call (866) 249-5109. Have your SeaSpine proxy card in hand when you call and then follow the instructions to vote your shares.

 

   

If you vote via the Internet or by telephone, you must do so before the start of the SeaSpine special meeting at 9 a.m. Pacific Time on January 4, 2023.

Voting by Mail

As an alternative to submitting your proxy via the Internet or by telephone, you may submit your proxy by mail.

 

   

To submit your proxy by mail, simply mark your SeaSpine proxy card, date and sign it and return it in the postage-paid envelope. If you do not have the postage-paid envelope, please mail your completed SeaSpine proxy card to the following address: Mediant, P.O. Box 8016, Cary, NC 27512-9903.

 

   

If you vote by mail, your SeaSpine proxy card must be received no later than 11:59 p.m. Eastern Time on January 3, 2023.

 

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General

Please be aware that any costs related to voting via the Internet, such as Internet access charges, will be your responsibility.

All properly signed proxies that are timely received and that are not revoked will be voted at the SeaSpine special meeting according to the instructions indicated on the proxies or, if no direction is indicated, they will be voted as recommended by the SeaSpine Board.

Treatment of Abstentions; Failure to Vote

For purposes of the SeaSpine special meeting, an abstention occurs when a SeaSpine stockholder attends the SeaSpine special meeting, either in person or by proxy, but abstains from voting.

 

   

For the SeaSpine merger proposal, if a SeaSpine stockholder present in person at the SeaSpine special meeting abstains from voting, or responds by proxy with an “abstain” vote, it will have the effect of a vote cast “AGAINST” such proposal. If a SeaSpine stockholder is not present in person at the SeaSpine special meeting and does not respond by proxy, it will have the effect of a vote cast “AGAINST” such proposal.

 

   

For the SeaSpine merger-related compensation proposal, if a SeaSpine stockholder present in person at the SeaSpine special meeting abstains from voting, or responds by proxy with an “abstain” vote, it will have the same effect as a vote cast “AGAINST” such proposal. If a SeaSpine stockholder is not present in person at the SeaSpine special meeting and does not respond by proxy, it will have no effect on the vote count for such proposal (assuming a quorum is present).

 

   

For the SeaSpine adjournment proposal, if a SeaSpine stockholder present in person at the SeaSpine special meeting abstains from voting, or responds by proxy with an “abstain” vote, it will have the same effect as a vote cast “AGAINST” such proposal. If a SeaSpine stockholder is not present in person at the SeaSpine special meeting and does not respond by proxy, it will have no effect on the vote count for such proposal.

Shares Held in Street Name

If your shares of SeaSpine common stock are held in an account at a bank, broker or other nominee holder of record (i.e., in “street name”), you must provide the record holder of your shares with instructions on how to vote the shares. Please follow the voting instructions provided by the bank, broker or other nominee. You may not vote shares held in street name by returning a SeaSpine proxy card directly to SeaSpine or by voting in person at the SeaSpine special meeting unless you provide a “legal proxy,” which you must obtain from your bank, broker or other nominee. Further, banks, brokers or other nominees who hold shares of SeaSpine common stock on behalf of their customers may not give a proxy to SeaSpine to vote those shares with respect to the SeaSpine merger proposal, the SeaSpine merger-related compensation proposal and the SeaSpine adjournment proposal without specific instructions from their customers, as banks, brokers and other nominees do not have discretionary voting power on these “non-routine” matters. Under current rules, each of the three proposals to be considered at the SeaSpine special meeting as described in this joint proxy statement/prospectus are considered non-routine. Therefore banks, brokers and other nominee holders of record do not have discretionary authority to vote on any of the three proposals to be considered at the SeaSpine special meeting. Broker non-votes occur when a broker or nominee is not instructed by the beneficial owner of shares to vote on a particular proposal for which the broker does not have discretionary voting power.

Therefore, if you are a SeaSpine stockholder and you do not instruct your bank, broker or other nominee on how to vote your shares:

 

   

your bank, broker or other nominee may not vote your shares on the SeaSpine merger proposal, which broker non-votes, if any, will have the same effect as a vote “AGAINST” such proposal;

 

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your bank, broker or other nominee may not vote your shares on the SeaSpine merger-related compensation proposal, which broker non-votes, if any, will have no effect on the vote count for such proposal (assuming a quorum is present); and

 

   

your bank, broker or other nominee may not vote your shares on the SeaSpine adjournment proposal, which broker non-votes, if any, will have no effect on the vote count for such proposal.

Attendance at the SeaSpine Special Meeting and Voting in Person

SeaSpine stockholders of record as of the record date for the SeaSpine special meeting will be required to present a valid government-issued photo identification to gain admittance to the SeaSpine special meeting. SeaSpine stockholders who hold their shares through a bank, broker or other nominee and who wish to attend the SeaSpine special meeting will be required to present verification of ownership of SeaSpine common stock, such as a bank or brokerage firm account statement, and will be required to present a valid government-issued photo identification to gain admittance to the SeaSpine special meeting.

Because of security procedures, SeaSpine stockholders of record as of the record date who plan to attend the SeaSpine special meeting will need to obtain an admission ticket in advance. Admission tickets will be available to both registered and beneficial owners of SeaSpine common stock. You may apply for an admission ticket by mail to Office of the Corporate Secretary, 5770 Armada Drive, Carlsbad, California 92008. SeaSpine’s Corporate Secretary must receive your request for an admission ticket on or before 11:59 p.m. Eastern Time on January 2, 2023. If you are a beneficial owner of SeaSpine common stock and hold your shares through a bank, broker or other nominee and you plan to attend the SeaSpine special meeting in person, in addition to following the procedures described above, you will also need to provide proof of beneficial ownership at the SeaSpine record date to obtain your admission ticket for the SeaSpine special meeting. Please note that seating will be limited and requests for admission tickets will be accepted on a first-come, first-served basis.

If you are a stockholder of record and plan to attend the SeaSpine special meeting and wish to vote in person, you will be given a ballot at the SeaSpine special meeting. Please note, however, that if your shares are held of record by a bank, broker or other nominee, and you wish to vote in person at the SeaSpine special meeting, you must bring to the SeaSpine special meeting a legal proxy from the record holder of the shares (your bank, broker or other nominee) authorizing you to vote at the SeaSpine special meeting.

No cameras, recording equipment, electronic devices, large bags, briefcases or packages will be permitted in the SeaSpine special meeting. In addition, SeaSpine stockholders seeking to attend the SeaSpine special meeting and their carried items may be subject to search.

Revocability of Proxies

Any SeaSpine stockholder of record giving a proxy has the power to revoke it. If you are a SeaSpine stockholder of record, you may revoke your proxy in any of the following ways:

 

   

By delivering, before 11:59 p.m. Eastern Time on January 2, 2023, to SeaSpine’s Corporate Secretary (at the Office of the Corporate Secretary, 5770 Armada Drive, Carlsbad, California 92008) a signed written notice of revocation bearing a later date than the proxy, stating that the proxy is revoked (i.e., your most recent duly submitted voting instructions will be followed);

 

   

By duly executing a subsequently dated proxy relating to the same shares of SeaSpine common stock and delivering it to SeaSpine’s Corporate Secretary at the address in the bullet point above (i.e., your most recent duly submitted voting instructions will be followed) before 11:59 p.m. Eastern Time on January 2, 2023;

 

   

By duly submitting a subsequently dated proxy vote relating to the same shares of SeaSpine common stock by telephone or via the Internet (using the original instructions provided to you) (i.e., your most recent duly submitted voting instructions will be followed) before 11:59 p.m. Eastern Time on January 3, 2023; or

 

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By attending the SeaSpine special meeting in person and voting such shares during the SeaSpine special meeting as described above, although attendance at the SeaSpine special meeting will not, by itself, revoke a proxy.

If your shares are held by a bank, broker or other nominee, you may change your vote by submitting new voting instructions to your bank, broker or other nominee. You must contact your bank, broker or other nominee to find out how to do so.

Solicitation of Proxies; Expenses of Solicitation

The SeaSpine Board is soliciting proxies for the SeaSpine special meeting from its stockholders. SeaSpine will bear a portion of the cost of the solicitation of proxies, including preparation, assembly and delivery, as applicable, of this joint proxy statement/prospectus, the SeaSpine proxy card and any additional materials furnished to SeaSpine stockholders. Proxies may be solicited by directors, officers and a small number of SeaSpine’s regular employees personally or by mail, telephone or facsimile, but such persons will not be specially compensated for such service. SeaSpine has retained Kingsdale Advisors, a proxy solicitation firm, to assist in the solicitation of proxies for a fee of approximately $13,500 plus reasonable out-of-pocket costs and expenses. As appropriate, copies of solicitation material will be furnished to brokerage houses, fiduciaries and custodians that hold shares of SeaSpine common stock of record for beneficial owners for forwarding to such beneficial owners. SeaSpine may also reimburse persons representing beneficial owners for their costs of forwarding the solicitation material to such owners.

Assistance

If you need assistance with voting via the Internet, voting by telephone or completing your SeaSpine proxy card, or have questions regarding the SeaSpine special meeting, please contact Kingsdale Advisors, the proxy solicitor for SeaSpine, toll free at (855) 476-7861 or collect outside North America at (917) 813-1235.

Your vote is very important regardless of the number of shares of SeaSpine common stock that you own and the matters to be considered at the SeaSpine special meeting are of great importance to the stockholders of SeaSpine. Accordingly, you are urged to read and carefully consider the information contained in or incorporated by reference into this joint proxy statement/prospectus and submit your proxy via the Internet or by telephone or, if applicable, complete, date, sign and promptly return the enclosed SeaSpine proxy card or voting instruction form in the enclosed postage-paid envelope. If you submit your proxy via the Internet or by telephone, you do not need to return the enclosed SeaSpine proxy card.

Please vote your shares via the Internet or by telephone, or sign, date and return a SeaSpine proxy card or voting instruction form promptly to ensure that your shares can be represented, even if you otherwise plan to attend the SeaSpine special meeting in person.

Tabulation of Votes

SeaSpine has appointed Patrick Keran to serve as the Inspector of Election for the SeaSpine special meeting. Broadridge will independently tabulate affirmative and negative votes and abstentions.

Adjournments

Subject to certain restrictions contained in the merger agreement, the SeaSpine special meeting may be adjourned to allow additional time for obtaining additional proxies. No notice of an adjourned meeting need be given if the time and place (if any) thereof, and the means of remote communication (if any) by which stockholders and proxyholders may be deemed to be present in person and vote at the meeting, are announced at the SeaSpine special meeting at which the adjournment was taken unless:

 

   

the adjournment is for more than 30 days, in which case a notice of the adjourned meeting will be given to each SeaSpine stockholder of record entitled to vote at the SeaSpine special meeting; or

 

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if, after the adjournment, a new record date for determination of SeaSpine stockholders entitled to vote is fixed for the adjourned meeting, in which case the SeaSpine Board will fix as the record date for determining SeaSpine stockholders entitled to notice of such adjourned meeting the same or an earlier date as that fixed for determination of SeaSpine stockholders entitled to vote at the adjourned meeting, and will give notice of the adjourned meeting to each SeaSpine stockholder of record as of such record date.

At any adjourned meeting, all proxies will be voted in the same manner as they would have been voted at the original convening of the SeaSpine special meeting, except for any proxies that have been effectively revoked or withdrawn prior to the adjourned meeting.

 

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SEASPINE PROPOSAL I: ADOPTION OF THE MERGER AGREEMENT AND

ORTHOFIX PROPOSAL I: APPROVAL OF THE SHARE ISSUANCE

The following is a discussion of the merger between Orthofix and SeaSpine. The description of the merger agreement in this section and elsewhere in this joint proxy statement/prospectus is qualified in its entirety by reference to the complete text of the merger agreement, a copy of which is attached as Annex A, and is incorporated by reference into this joint proxy statement/prospectus. This summary does not purport to be complete and may not contain all of the information about the merger that is important to you. You are encouraged to read the merger agreement carefully and in its entirety. This section is not intended to provide you with any factual information about Orthofix or SeaSpine. Such information can be found elsewhere in this joint proxy statement/prospectus and in the public filings Orthofix and SeaSpine make with the SEC that are incorporated by reference into this joint proxy statement/prospectus, as described in the section entitled “Where You Can Find More Information.”

Background of the Merger

In order to assist Orthofix management in exploring, reviewing and evaluating potential opportunities for corporate strategic planning, the Orthofix Board formed a strategic steering committee in September 2021. The primary responsibilities of the Orthofix strategic steering committee included (1) overseeing the retention of advisors to assist with the review and evaluation of the Orthofix strategic plan and (2) oversight of a process to review and evaluate potential strategic alternatives for Orthofix, including opportunities for strategic business combinations and similar strategic transactions.

The SeaSpine Board, together with members of SeaSpine management, regularly review and assess the performance, future growth prospects, business plans and overall strategic direction of SeaSpine, and consider a variety of strategic alternatives that may be available to SeaSpine, including continuing to pursue SeaSpine’s strategy as a standalone company or pursuing potential strategic or financing transactions with third parties, in each case with the goal of maximizing stockholder value.

From October 2021 through February 2022, the Orthofix strategic steering committee met periodically, including with outside advisors, to review the competitive landscape and recent developments in the medical device industry and to identify, evaluate and consider potential strategic opportunities for Orthofix.

On October 28, 2021, at a meeting of the Orthofix strategic steering committee, the committee reviewed with Orthofix management proposals from two global management consulting firms to assist the committee and Orthofix management with an assessment of strategic alternatives, which proposals were solicited by Orthofix management at the direction of the strategic steering committee. A third global management consulting firm was also invited to submit a proposal but declined to do so. After this review, the committee directed Orthofix management to engage one of two global management consulting firms that had submitted proposals (“Consultant A”). The Orthofix strategic steering committee selected Consultant A due to, among other reasons, its prior experience assisting Orthofix with a previous consulting matter, its extensive experience in Orthofix’s industry and its familiarity with Orthofix’s business and strategic objectives.

On December 9, 2021, at a meeting of the Orthofix strategic steering committee, representatives of Consultant A provided the committee with preliminary views on the Orthofix business and an overview and timeline for their review of potential strategic alternatives.

On December 13, 2021, at a meeting of the Orthofix Board, representatives from Consultant A, at the direction of the strategic steering committee, presented to the Orthofix Board an overview and timeline for their review of potential strategic alternatives for Orthofix. The Orthofix Board directed the Consultant A team to proceed with their work as presented and to provide interim reports to the Orthofix strategic steering committee and to the Orthofix Board.

 

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On January 20, 2022, the Orthofix strategic steering committee held a meeting that included members of Orthofix management and representatives of Consultant A. Representatives of Perella Weinberg, which had previously served, from time to time, as a financial advisor to Orthofix, were also in attendance at the request of the committee. The Orthofix strategic steering committee requested Perella Weinberg to provide advice and recommendations with respect to strategic alternatives due to, among other things, its prior experience assisting Orthofix with various matters, its extensive experience in Orthofix’s industry, its familiarity with Orthofix’s business and strategic objectives, and its qualifications and deep expertise in the matters that were to be considered by the Orthofix Board. The committee and representatives of Consultant A discussed Consultant A’s analysis of the current Orthofix business and product portfolio, its strategic plan and potential strategic opportunities to create additional value for Orthofix stockholders, including by increasing scale and revenue growth through larger scale mergers and acquisitions opportunities in the spine and biologics segments. The committee and representatives of Consultant A also discussed potential transaction counterparties that could align with such a growth-focused strategy. The committee and representatives of Perella Weinberg discussed various potential alternatives to create additional value for Orthofix stockholders, including strategies involving (i) investing in new and existing products, (ii) executing a transformative merger and acquisition transaction to achieve scale and accelerate revenue growth, (iii) divesting non-core assets, and (iv) a near-term sale of Orthofix. The committee and representatives of Perella Weinberg discussed various considerations in connection with these alternatives, including Perella Weinberg’s analysis of various potential benefits, risks and obstacles to each alternative strategy. The committee and representatives of Perella Weinberg also discussed Perella Weinberg’s preliminary analysis of certain potential larger scale business combination counterparties that could align with a growth-focused strategy, including SeaSpine. After discussion, it was the consensus of the committee that a larger scale business combination transaction to achieve scale and accelerate revenue growth was the most compelling option, and that a potential combination with SeaSpine appeared to offer the most compelling strategic fit to align with this strategy. The committee therefore directed Orthofix management and representatives of Perella Weinberg to analyze in greater detail a potential SeaSpine business combination and to provide an updated report to the Orthofix strategic steering committee at a future meeting. The Orthofix strategic steering committee also determined that, given SeaSpine appeared as a preliminary matter to be the most compelling strategic option for Orthofix, Orthofix should focus its analysis on a SeaSpine opportunity and determine its feasibility before spending substantial time and resources on analyzing alternative opportunities.

On February 16, 2022, the Orthofix strategic steering committee held a meeting that included members of Orthofix management and representatives of Consultant A and Perella Weinberg. The committee discussed with representatives of Perella Weinberg and Orthofix management a preliminary analysis prepared by Perella Weinberg of SeaSpine’s business and management, financial profile, projections, industry analyst views and historical performance of its common stock, as well as certain considerations for a potential business combination with SeaSpine, including potential merger structures. After discussion, it was the consensus of the committee that an all-stock “merger of equals” transaction structure would likely offer the most compelling transaction structure for Orthofix stockholders, including with respect to likelihood of consummation. At the conclusion of the meeting, the Orthofix strategic steering committee directed Mr. Serbousek to contact Keith C. Valentine, chief executive officer of SeaSpine, to determine if SeaSpine was interested in engaging in preliminary discussions regarding a potential business combination with Orthofix and to conduct such preliminary initial discussions.

On February 23, 2022, Mr. Serbousek spoke by telephone to Mr. Valentine and communicated to him that Orthofix was interested in exploring a potential business combination with SeaSpine.

On February 24, 2022, Orthofix provided SeaSpine with a draft mutual confidentiality agreement.

Also on February 24, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and representatives of Piper Sandler, financial advisor to SeaSpine. The SeaSpine Board selected Piper Sandler to serve as SeaSpine’s financial advisor in connection with the potential transaction due to, among other things, their extensive experience in SeaSpine’s industry and their familiarity with SeaSpine’s business and

 

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strategic objectives, including through their prior experience assisting SeaSpine with various matters, and their qualifications and deep expertise in the matters that were to be considered by the SeaSpine Board. Members of SeaSpine management and representatives of Piper Sandler discussed with the SeaSpine Board an overview of current market conditions, including capital market conditions, potential strategic opportunities, certain strategic and financial considerations with respect to such opportunities, and the financial implications of a potential business combination with other companies, as well as executing SeaSpine’s standalone business plan, including the impact of raising additional financing to execute such standalone business plan.

Between February 24 and February 28, 2022, Orthofix management and SeaSpine management negotiated a mutual confidentiality agreement and, on February 28, 2022, Orthofix and SeaSpine entered into the mutual confidentiality agreement to facilitate the preliminary exchange of non-public information between the two companies and their advisors for the purpose of exploring a potential business combination transaction. The confidentiality agreement contained a standstill provision as well as a “don’t ask, don’t waive” provision but also allowed for non-public communications between senior management of each company to request waivers of the standstill provisions.

On March 3, 2022, Mr. Serbousek and Kimberley A. Elting, Orthofix chief legal and development officer and president of global orthopedics, met in Carlsbad, California with Mr. Valentine and Patrick L. Keran, SeaSpine senior vice president, general counsel and secretary. During the discussions, each party indicated that it was open to exploring, on a preliminary basis, the opportunity for a potential business combination transaction between Orthofix and SeaSpine that would be structured as a merger of equals. The parties then discussed potential synergies that could result from a potential business combination of Orthofix and SeaSpine.

On March 9, 2022, the Orthofix Board held a meeting during which members of the strategic steering committee and Orthofix management updated the Orthofix Board on the strategic alternatives work that had been done over the prior three months, which had been overseen by the strategic steering committee. The update included a review of the work done by Consultant A and Perella Weinberg, the recommendations of these advisors, and the direction provided to management by the strategic steering committee. The Orthofix Board also received an update regarding the preliminary discussions between Orthofix management and SeaSpine management, including both the initial call between Mr. Serbousek and Mr. Valentine on February 23, 2022, and the subsequent in-person meeting on March 3, 2022 in Carlsbad, California. The Orthofix Board directed Orthofix management to continue preliminary discussions with SeaSpine in order to assess the feasibility and merits of a potential business combination transaction with SeaSpine. The Orthofix Board also determined that the full Orthofix Board would oversee discussions and negotiations with SeaSpine regarding a potential business combination, in lieu of the Orthofix strategic steering committee, and that management should report back to the full Orthofix Board regarding the status of further discussions with SeaSpine.

On March 16, 2022, Mr. Serbousek and Mr. Valentine spoke by telephone to further discuss a potential business combination of Orthofix and SeaSpine.

On March 17 and March 22, 2022, members of Orthofix management and members of SeaSpine management met by videoconference. In addition to financial due diligence matters, the parties discussed their respective commercial structures, product portfolios, management teams, potential synergies and possible benefits to the two companies of a business combination. No specific transaction terms were discussed.

On March 23, 2022, the SeaSpine Board held a meeting. Members of SeaSpine management and representatives of Piper Sandler attended the meeting and provided the SeaSpine Board with an update on the discussions and due diligence efforts with Orthofix in connection with a potential business combination and certain materials regarding precedent merger and acquisition transactions.

On March 24, 2022, members of Orthofix management met by videoconference with representatives of the SeaSpine clinical regulatory team to discuss Orthofix spine products.

 

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On March 25, 2022, Mr. Serbousek and Mr. Valentine spoke by telephone to further discuss a potential business combination of Orthofix and SeaSpine.

On March 28, 2022, the Orthofix Board held a regular meeting in Sarasota, Florida. Several members of Orthofix management participated for certain portions of the meeting. During the meeting, Mr. Hannon described his current social and former professional relationships with two current SeaSpine executives and Mr. Hinrichs described his former professional relationship with one current SeaSpine executive and social relationships with a SeaSpine director. Each of Messrs. Hannon and Hinrichs informed the Orthofix Board that he did not believe the relationships would affect his independence with respect to the consideration of a potential business combination with SeaSpine. After Messrs. Hannon and Hinrichs temporarily recused themselves from the Orthofix Board meeting, the Orthofix Board discussed the relationships and determined that each of Messrs. Hannon and Hinrichs were independent with respect to the consideration of the potential business combination with SeaSpine. The Orthofix Board then discussed engaging Perella Weinberg to serve as Orthofix’s financial advisor in connection with the potential transaction. The Orthofix Board considered, among other things, Perella Weinberg’s prior experience assisting Orthofix with various matters, its extensive experience in Orthofix’s industry, its familiarity with Orthofix’s business and strategic objectives, and its qualifications and deep expertise in the matters that were to be considered by the Orthofix Board. Ms. Elting provided the Orthofix Board with an overview of the engagement terms proposed by Perella Weinberg and noted that the engagement letter would be presented to the Orthofix Board by email for review and approval prior to its execution. On April 18, 2022, following such email distribution and approval by the Orthofix Board, Orthofix and Perella Weinberg executed the engagement letter.

Representatives of Perella Weinberg and Hogan Lovells US LLP (“Hogan Lovells”), outside legal counsel to Orthofix, joined for certain portions of the Orthofix Board meeting. Representatives of Hogan Lovells discussed with the Orthofix Board and Orthofix management the directors and officers’ fiduciary duties and certain other legal matters in the context of reviewing and analyzing a potential business combination transaction. The Orthofix Board and Orthofix management then discussed with representatives of Perella Weinberg an update on meetings and negotiations with SeaSpine. Next, the Orthofix Board, Orthofix management and representatives of Perella Weinberg reviewed a preliminary financial analysis, prepared by Perella Weinberg at the direction of the Orthofix Board and based on public data and input from Orthofix and SeaSpine management, with respect to the potential business combination. The Orthofix Board directed Orthofix management to continue preliminary discussions with SeaSpine in order to assess the feasibility and merits of a potential transaction with SeaSpine.

On April 1, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and representatives of Piper Sandler and DLA Piper LLP (US), outside legal counsel to SeaSpine (“DLA”). Members of SeaSpine management and representatives of Piper Sandler provided the SeaSpine Board with an update on the status of discussions with Orthofix regarding a potential business combination. Representatives of DLA discussed with the SeaSpine Board the directors’ fiduciary duties in the context of reviewing and analyzing a potential business combination transaction.

Later on April 1, 2022, Mr. Serbousek and Mr. Valentine spoke by telephone to further discuss a potential business combination of Orthofix and SeaSpine and agreed to direct representatives of Perella Weinberg and Piper Sandler to discuss a potential business combination of Orthofix and SeaSpine.

At the direction of each of Orthofix and SeaSpine, respectively, between April 3 and April 12, 2022, representatives of Perella Weinberg and Piper Sandler had several discussions regarding a potential business combination of Orthofix and SeaSpine, including with respect to the preliminary financial analysis prepared by each financial advisor.

On April 13, 2022, the Orthofix Board held a meeting. Members of Orthofix management and representatives of Perella Weinberg also attended the meeting. The Orthofix Board discussed with representatives of Perella Weinberg (i) the status of meetings and negotiations with SeaSpine and (ii) a draft term

 

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sheet for a potential business combination between Orthofix and SeaSpine. Next, the Orthofix Board and representatives of Perella Weinberg reviewed an updated preliminary financial analysis, prepared by Perella Weinberg at the direction of the Orthofix Board and based on public data and input from Orthofix and SeaSpine management, with respect to the potential business combination. The Orthofix Board discussed the information presented at the meeting and authorized Orthofix’s management to further explore a potential stock-for-stock “merger of equals” transaction with SeaSpine, including by delivering a non-binding indication of interest for a business combination in which Orthofix stockholders would retain ownership of 58.5% of a combined company.

Also on April 13, 2022, SeaSpine management circulated to the SeaSpine Board a summary of the recent discussions with Orthofix representatives regarding a potential business combination that had been provided by representatives of Piper Sandler. Following review of the summary, the SeaSpine Board reached an informal consensus that the anticipated Orthofix proposal for a potential business combination as summarized by representatives of Piper Sandler was insufficient for initiating negotiations and continued discussion.

On April 14, 2022, before SeaSpine management had notified Orthofix of the SeaSpine Board’s determination for discontinued discussions, Orthofix delivered to SeaSpine a written preliminary, non-binding indication of interest outlining the terms of a business combination between Orthofix and SeaSpine in which Orthofix stockholders would retain ownership of 58.5% of the combined company, the board of directors of the combined company would be comprised of five (5) members selected by the Orthofix Board and four (4) members selected by the SeaSpine Board, and the parties would mutually agree on the individuals to fill the Chairperson and Chief Executive Officer roles. The preliminary non-binding indication of interest also stated that any transaction would be subject to completion of due diligence.

On April 15, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and representatives of Piper Sandler and DLA. Representatives of DLA discussed with the SeaSpine Board the directors’ fiduciary duties in the context of reviewing and analyzing a potential business combination transaction. Members of SeaSpine management and representatives of Piper Sandler and DLA also provided a status update on discussions and negotiations with Orthofix and reviewed the April 14 preliminary, non-binding indication of interest from Orthofix. Representatives of Piper Sandler reviewed with the SeaSpine Board certain financial aspects of such non-binding indication of interest and certain preliminary financial analyses relating to such indication of interest, as well as a review of other potential strategic counterparties. Following this discussion, the SeaSpine Board determined that the non-binding indication of interest did not provide sufficient value and reaffirmed that SeaSpine management should discontinue discussions with Orthofix.

Later on April 15, 2022, Mr. Serbousek and Mr. Valentine spoke by telephone regarding the Orthofix preliminary non-binding indication of interest delivered to SeaSpine. Mr. Valentine informed Mr. Serbousek that the SeaSpine Board had determined that the Orthofix non-binding indication of interest did not provide sufficient value to SeaSpine stockholders and that SeaSpine would not continue discussions with Orthofix at that time. Representatives of Piper Sandler also communicated the views of the SeaSpine Board to representatives of Perella Weinberg.

On April 20, 2022, the Orthofix Board held a meeting, with members of Orthofix management and representatives of Perella Weinberg attending the meeting. The Orthofix Board discussed with representatives of Perella Weinberg the status of negotiations between Orthofix and SeaSpine that had occurred since the delivery of the April 14 preliminary, non-binding indication of interest from Orthofix to SeaSpine, including the SeaSpine response that the non-binding indication of interest did not provide sufficient value to SeaSpine stockholders and that SeaSpine would not continue discussions with Orthofix at this time. After discussion, including a review by the Orthofix Board with Perella Weinberg of an updated preliminary financial analysis, prepared by Perella Weinberg at the direction of the Orthofix Board and based on public data and input from Orthofix and SeaSpine management, with respect to the potential business combination, the Orthofix Board determined that Orthofix would not seek further discussions until after each company had released its first quarter 2022 earnings results in early May 2022.

Also on April 20, 2022, Mr. Valentine had an in-person meeting in San Diego, California with the chief executive officer of Party A, a strategic company, to meet one another and discuss general market challenges.

 

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In early May 2022, Mr. Valentine called the chief executive officer of Party A to discuss a potential strategic transaction.

In late May 2022, Mr. Serbousek and Mr. Valentine spoke by telephone regarding the terms of the April 14 preliminary, non-binding indication of interest and, separately, representatives of Perella Weinberg and Piper Sandler spoke by telephone regarding the same.

On May 27, 2022, the Orthofix Board held a meeting, and members of Orthofix management and representatives of Perella Weinberg also attended the meeting. Mr. Serbousek and representatives of Perella Weinberg discussed with the Orthofix Board an update regarding their respective discussions with SeaSpine management and Piper Sandler. Next, the Orthofix Board and representatives of Perella Weinberg reviewed an updated preliminary financial analysis, prepared by Perella Weinberg at the direction of the Orthofix Board and based on public data and input from Orthofix and SeaSpine management, with respect to different potential ownership levels by Orthofix stockholders in a combined company following the potential business combination. After discussion, the Orthofix Board directed Orthofix management to deliver an updated non-binding indication of interest for a combination in which Orthofix stockholders would retain ownership of 58.0% of a combined company.

On May 31, 2022, Mr. Serbousek and Mr. Valentine spoke by telephone. Mr. Serbousek previewed that Orthofix would be sending SeaSpine an updated non-binding indication of interest letter for a combination in which Orthofix stockholders would retain ownership of 58.0% of the outstanding common stock of a combined company. Consistent with the April 14, 2022 indication of interest, this letter proposed that the board of directors of the combined company would be comprised of five (5) members selected by the Orthofix Board and four (4) members selected by the SeaSpine Board. In addition, this letter proposed that Mr. Valentine would serve as the combined company’s Chief Executive Officer and Mr. Serbousek would serve as the combined company’s Executive Chairman.

Later on May 31, 2022, Orthofix delivered to SeaSpine a written preliminary, non-binding indication of interest outlining the terms of a business combination between Orthofix and SeaSpine in which Orthofix stockholders would retain ownership of 58.0% of the combined company.

On June 1, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and representatives of Piper Sandler. The SeaSpine Board discussed the May 31 updated non-binding indication of interest from Orthofix and representatives of Piper Sandler and members of SeaSpine management provided an update on the status of discussions and negotiations with Orthofix. Representatives of Piper Sandler also discussed with the SeaSpine Board an overview of current market conditions, including capital market conditions, and potential financing alternatives for SeaSpine. The SeaSpine Board directed Piper Sandler to prepare a review of certain financial aspects of the most recent non-binding indication of interest from Orthofix.

On June 6, 2022, the Orthofix Board held a meeting via videoconference. Several members of Orthofix management also attended the meeting. Mr. Serbousek provided the Orthofix Board with an update on discussions with SeaSpine, including with respect to the May 31 updated non-binding indication of interest that had been delivered to SeaSpine.

On June 9, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and representatives of Piper Sandler. Representatives of Piper Sandler reviewed with the SeaSpine Board certain financial aspects of the most recent non-binding indication of interest from Orthofix (as requested by the SeaSpine Board on June 1, 2022) and certain preliminary financial analyses relating to such indication of interest, financial implications of executing SeaSpine’s standalone business plan, including the impact of raising additional financing to execute such standalone business plan, as well as certain financial aspects of a potential business combination with Party A and certain preliminary financial analyses relating to such potential business combination with Party A. After further discussion, the SeaSpine Board directed SeaSpine management to provide Orthofix with a counter-proposal to the Orthofix May 31 updated non-binding indication of interest that

 

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reflected an exchange ratio of 0.5000 (i.e., each share of SeaSpine common stock would convert in the merger into 0.5000 shares of Orthofix common stock), which implied that SeaSpine stockholders would retain an ownership share of approximately 48% in a combined company. 

On June 10, 2022, SeaSpine countered Orthofix’s most recent non-binding indication of interest with respect to a proposed business combination such that SeaSpine stockholders would retain an ownership share of 48% in a combined company.

Later on June 10, 2022, Mr. Serbousek and Mr. Valentine spoke by telephone. Mr. Valentine reiterated SeaSpine’s interest in the proposed business combination but relayed SeaSpine’s position that an ownership share of 42% for the SeaSpine stockholders in a combined company was not acceptable to the SeaSpine Board.

On June 15, 2022, the Orthofix Board held a meeting to discuss the updated non-binding indication of interest that had been delivered to Orthofix by SeaSpine on June 10, 2022. Representatives of Perella Weinberg also attended the meeting along with a member of Orthofix management. Mr. Serbousek and representatives of Perella Weinberg discussed with the Orthofix Board an update on discussions with SeaSpine regarding the June 10 SeaSpine non-binding indication of interest. Next, the Orthofix Board and representatives of Perella Weinberg reviewed an updated preliminary financial analysis, prepared by Perella Weinberg at the direction of the Orthofix Board and based on public data and input from Orthofix and SeaSpine management, with respect to the ownership level for Orthofix stockholders in a combined company following the potential business combination as proposed by SeaSpine in its June 10 non-binding indication of interest. After discussion, the Orthofix Board directed Orthofix management and representatives of Perella Weinberg to communicate to SeaSpine that an ownership share of 52% for the Orthofix stockholders in a combined company was not acceptable to the Orthofix Board.

On June 16, 2022, following consideration of the terms of a negotiated proposed engagement letter with Piper Sandler, the SeaSpine Board approved by written consent the proposed engagement letter and directed SeaSpine management to execute the proposed engagement letter on behalf of SeaSpine, following which the parties executed the engagement letter.

On June 18, 2022, representatives of Piper Sandler and Perella Weinberg spoke by telephone to discuss the June 10 SeaSpine non-binding indication of interest and the proposed ownership allocation set forth therein.

On June 21, 2022, SeaSpine and Party A executed a confidentiality agreement, which contained customary limitations regarding the use and disclosure of SeaSpine confidential information, including a restriction on trading in the securities of SeaSpine and a standstill provision which would terminate on the public announcement of a contemplated transaction.

On June 23, 2022, the management teams of SeaSpine and Party A held a virtual preliminary due diligence session.

On June 25, 2022, representatives of Piper Sandler and Perella Weinberg spoke by telephone to discuss the June 10 SeaSpine non-binding indication of interest and the proposed ownership allocation set forth therein. Representatives of Perella Weinberg informed representatives of Piper Sandler that Orthofix did not intend to provide a counterproposal but rather proposed “restarting” negotiations with SeaSpine to seek to negotiate a resolution with respect to the ownership allocation in a combined company.

On June 29, 2022, the SeaSpine Board held a meeting, together with several members of SeaSpine management and representatives of Piper Sandler, to discuss the current negotiations with each of Orthofix and Party A. The SeaSpine Board reviewed and discussed with members of SeaSpine management and representatives of Piper Sandler the terms of the Orthofix May 31 updated non-binding indication of interest. Representatives of Piper Sander then reviewed certain financial aspects of such non-binding indication of interest, as well as certain financial aspects of a potential business combination with Party A. Following such

 

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discussion, the SeaSpine Board authorized a non-binding indication of interest to be delivered to Orthofix in which SeaSpine stockholders would retain ownership of 45.0% of a combined company and directed Mr. Valentine to deliver such proposal.

On June 30, 2022, Mr. Serbousek and Mr. Valentine spoke by telephone. Mr. Valentine discussed with Mr. Serbousek the continued interest of the SeaSpine Board in a business combination with Orthofix and previewed a forthcoming proposal from SeaSpine to Orthofix in which SeaSpine stockholders would retain ownership of 45.0% of a combined company. Also on June 30, 2022, representatives of Piper Sandler spoke by telephone with representatives of Perella Weinberg regarding the forthcoming proposal from SeaSpine.

From June 30 to July 20, 2022, members of SeaSpine management, together with representatives of SeaSpine’s outside advisors, conducted a series of due diligence sessions with representatives of Party A, which included discussions of SeaSpine financial, tax, operational, human resources and legal matters. Several such sessions were held during this period.

On July 3, 2022, Mr. Serbousek and Mr. Valentine spoke by telephone. Mr. Valentine orally presented a non-binding proposal in which SeaSpine stockholders would retain ownership of 45.0% of a combined company and indicated that the SeaSpine Board was interested in proceeding with further meetings and discussions.

On July 5, 2022, representatives of Perella Weinberg and representatives of Piper Sandler spoke by telephone to confirm the specifics of the non-binding proposal of SeaSpine presented by Mr. Valentine to Mr. Serbousek on July 3, 2022 in which SeaSpine stockholders would retain ownership of 45.0% of a combined company. Representatives of Perella Weinberg then updated members of Orthofix management on the status of discussions with SeaSpine, including the details of SeaSpine’s non-binding proposal.

On July 7, 2022, the Orthofix Board held a meeting to discuss the non-binding proposal presented by SeaSpine to Mr. Serbousek on July 3, 2022, as further detailed by Piper Sandler to Perella Weinberg on July 5, 2022. Representatives of Perella Weinberg attended the meeting along with members of Orthofix management. Mr. Serbousek provided the Orthofix Board with an update on discussions with SeaSpine, including the details of SeaSpine’s most recent non-binding proposal. Next, the Orthofix Board and representatives of Perella Weinberg reviewed an updated preliminary financial analysis, prepared by Perella Weinberg at the direction of the Orthofix Board and based on public data and input from Orthofix and SeaSpine management, with respect to the potential business combination. After discussion, the Orthofix Board directed Orthofix management and representatives of Perella Weinberg to communicate to SeaSpine that that an ownership share of 55% for the Orthofix stockholders in a combined company was not acceptable to the Orthofix Board and reiterated the prior Orthofix position that Orthofix stockholders would retain ownership of 58.0% of the combined company.

On July 10, 2022, Mr. Serbousek and Mr. Valentine spoke by telephone regarding the status of the negotiations regarding the ownership allocation for a combined company and determined that further discussions and meetings should take place, initially among financial advisors.

On July 15, 2022, representatives of Perella Weinberg and Piper Sandler discussed the potential benefit of an in-person meeting of certain members of the boards and management of each company along with financial advisors.

Between July 11 and August 8, 2022, conference calls were held between representatives of Perella Weinberg and Piper Sandler and between members of the Orthofix and SeaSpine management to discuss and prepare for an in-person meeting scheduled for August 8.

On August 8, 2022, an in-person meeting was held in the Dallas, Texas area to discuss the benefits of a potential business combination and due diligence matters. Attendees from the Orthofix Board included Catherine

 

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M. Burzik, the Orthofix Chair of the Board, and Messrs. Burris, Hinrichs and Paolucci. Attendees from the SeaSpine Board included Kirtley C. Stephenson, SeaSpine nonexecutive Chairman of the Board, and Stuart M. Essig, Ph.D., SeaSpine Lead Independent Director. Members of Orthofix management and SeaSpine management, along with representatives of Perella Weinberg and Piper Sandler, were also in attendance. No specific transaction terms were discussed.

On each of August 11, August 15 and August 17, 2022, members of Orthofix management and SeaSpine management, along with representatives of Perella Weinberg and Piper Sandler, met by videoconference to discuss potential cost and revenue synergies and potential dissynergies.

On August 11, 2022, Mr. Valentine spoke by telephone with the chief executive officer of Party A during which the Party A chief executive officer previewed a forthcoming indication of interest from Party A with respect to a potential acquisition of SeaSpine by Party A.

On August 12, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and certain representatives of Piper Sandler, to discuss the current negotiations with Orthofix and Party A. Representatives of Piper Sandler also discussed with the SeaSpine Board an overview of current market conditions, certain financial aspects of the non-binding indication of interest from Orthofix and certain preliminary financial analyses relating to such indication of interest, as well as certain financial aspects of a potential business combination with Party A.

On August 18, 2022, the Orthofix Board held a meeting to discuss the potential business combination with SeaSpine. Representatives of Perella Weinberg and members of Orthofix management also attended the meeting. The Orthofix Board discussed with Orthofix management and representatives of Perella Weinberg the status of negotiations with SeaSpine, including with respect to the August 8 in-person meeting. Next, the Orthofix Board and representatives of Perella Weinberg reviewed an updated preliminary financial analysis, prepared by Perella Weinberg at the direction of the Orthofix Board and based on public data and input from Orthofix and SeaSpine management, with respect to the potential business combination. After discussion, including with respect to the ownership allocation in a combined company, the Orthofix Board directed Mr. Serbousek to negotiate the final ownership allocation, provided that the ownership share for the Orthofix stockholders in a combined company would not be less than 56.5%.

Also on August 18, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and representatives of Piper Sandler, to discuss both updated synergy assumptions developed during recent diligence discussions between the parties and the further discussions between the parties of the ownership allocation in a combined company. Representatives of Piper Sandler discussed with the SeaSpine Board an overview of current market conditions, including capital market conditions and potential financing alternatives for SeaSpine, as well as reviewed certain financial aspects of the most recent non-binding indication of interest from Orthofix and certain preliminary financial analyses relating to such indication of interest, together with a review of certain financial aspects of a potential business combination with Party A.

Later on August 18, 2022, Dr. Essig and Ms. Burzik spoke by telephone to discuss the interest and support of each party’s board of directors for a potential business combination.

On August 19, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and representatives of Piper Sandler, to discuss the ownership allocation of a combined company. Following discussion, management was directed to propose a revised indication of interest to Orthofix in which SeaSpine stockholders would retain an implied ownership of 44.0% of a combined company based on the proposed exchange ratio.

On August 20 and 21, 2022, Mr. Serbousek and Mr. Valentine spoke by telephone regarding the ownership allocation for a combined company and Mr. Valentine delivered to Mr. Serbousek a revised non-binding indication of interest with respect to a proposed business combination in which SeaSpine stockholders would retain ownership of 44.0% of a combined company.

 

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Later on August 21, 2022, the Orthofix Board held a meeting to discuss the potential business combination with SeaSpine. Representatives of Perella Weinberg and members of Orthofix management also attended the meeting. The Orthofix Board discussed with Orthofix management and representatives of Perella Weinberg the status of negotiations with SeaSpine, including that SeaSpine had continued to propose a business combination in which SeaSpine stockholders would retain ownership of 44.0% of a combined company. After discussion, the Orthofix Board directed Mr. Serbousek to propose a business combination in which Orthofix stockholders would retain ownership of 57.0% of a combined company.

Following receipt of the revised non-binding indication of interest from Orthofix, the SeaSpine Board held a meeting on August 22, 2022, together with members of SeaSpine management and representatives of Piper Sandler and DLA, during which Party A sent SeaSpine a non-binding indication of interest with respect to a proposed strategic transaction. The indication of interest was for an all-stock transaction based on an exchange ratio range that at the time implied a value for SeaSpine of approximately $6.35 to $7.08 per share, which was in the range of an at-market price at that time. At the meeting, members of SeaSpine management informed the SeaSpine Board of the terms of the revised indication of interest from Orthofix and a preliminary assessment of the Party A proposal. Representatives of Piper Sandler reviewed with the SeaSpine Board certain financial aspects of the most recent non-binding indication of interest from Orthofix. Representatives of DLA discussed with the SeaSpine Board the directors’ fiduciary duties in the context of reviewing and analyzing a potential business combination transaction. Following discussion, the SeaSpine Board directed Piper Sandler to prepare a review of certain financial aspects of the non-binding indication of interest submitted by Party A. Further, the SeaSpine Board directed management to send a revised indication of interest to Orthofix providing for a proposed business combination in which SeaSpine stockholders would retain ownership of 43.5% of the combined company.

Later on August 22, 2022, Mr. Serbousek spoke by telephone with Mr. Valentine and informed him that the Orthofix Board was supportive of a potential business combination in which Orthofix stockholders would retain ownership of 57.0% of a combined company. After further discussion, Mr. Valentine proposed a potential business combination in which Orthofix stockholders would retain ownership of 56.5% of the combined company and SeaSpine stockholders would retain ownership of 43.5% of the combined company. Mr. Serbousek informed Mr. Valentine that he was willing to discuss this proposal with the Orthofix Board.

On August 23, 2022, the Orthofix Board held a meeting to discuss the potential business combination with SeaSpine. Representatives of Perella Weinberg and members of Orthofix management also attended the meeting. The Orthofix Board discussed with Orthofix management and representatives of Perella Weinberg the status of negotiations with SeaSpine, including that SeaSpine had presented an updated proposal in which SeaSpine stockholders would retain ownership of 43.5% of the combined company. After discussion, the Orthofix Board determined that the following terms would be acceptable, subject to satisfactory completion of due diligence and negotiation and execution of a definitive agreement: (1) a business combination between Orthofix and SeaSpine in which Orthofix stockholders would retain ownership of 56.5% of the combined company, (2) the board of directors of the combined company would be comprised of five (5) members selected by the Orthofix Board and four (4) members selected by the SeaSpine Board, and (3) the individuals to fill the Chairperson and Chief Executive Officer roles would be selected by the Orthofix Board.

Following the Orthofix Board meeting, Mr. Serbousek spoke by telephone with Mr. Valentine and informed him of the Orthofix Board’s determination, and Mr. Serbousek and Mr. Valentine agreed to work expeditiously to complete due diligence and to prepare, finalize and enter into a definitive merger agreement reflecting the agreed-upon ownership allocation.

On August 24, 2022, Mr. Valentine spoke by telephone with the Party A chief executive officer to discuss Party A’s non-binding indication of interest and expected transaction process, as well as the perspective of the Party A board of directors on a possible strategic transaction with SeaSpine.

 

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On August 25, 2022, representatives of Piper Sandler contacted members of Party A management to schedule a discussion to review Party A’s non-binding indication of interest.

Also on August 25, 2022, representatives of Piper Sandler and Perella Weinberg spoke by telephone to discuss a process to expeditiously complete due diligence and prepare, finalize and enter into a definitive agreement with respect to a SeaSpine-Orthofix business combination.

On August 25 and 26, 2022, Ms. Burzik and Dr. Essig spoke by telephone to discuss the process for determining the composition of the combined company’s board of directors and executive leadership team.

On August 26, 2022, members of Orthofix and SeaSpine management and representatives from each of Perella Weinberg, Hogan Lovells, DLA and Piper Sandler spoke via videoconference regarding a process to expeditiously complete due diligence and prepare, finalize and enter into a definitive agreement with respect to a SeaSpine-Orthofix business combination.

Also on August 26, 2022, representatives of Piper Sandler spoke with members of Party A senior management to review Party A’s non-binding indication of interest.

Later on August 26, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and representatives of Piper Sandler and DLA. Representatives of Piper Sandler reviewed with the SeaSpine Board certain financial aspects of the non-binding indication of interest from Party A (as requested by the SeaSpine Board on August 22, 2022), as well as certain financial aspects of the most recent non-binding indication of interest from Orthofix. Representatives of DLA discussed with the SeaSpine Board the directors’ fiduciary duties in the context of reviewing and analyzing a potential business combination transaction. Following discussion, the SeaSpine Board unanimously determined that the terms of the Party A non-binding indication of interest did not, at that time, provide the SeaSpine stockholders with sufficient value. Mr. Valentine was directed to convey such determination to Party A, which Mr. Valentine conveyed following the meeting.

Later on August 26, 2022, representatives of Piper Sandler informed representatives of Party A that SeaSpine would be interested only in a transaction in which SeaSpine stockholders would receive a premium to the current trading price of the SeaSpine common stock. Representatives of Party A replied that it was unlikely the value in its non-binding indication of interest would be increased due to the current low trading price of Party A common stock.

On August 28, 2022, Mr. Valentine and several members of the Orthofix Board met in-person in San Diego, California to discuss staffing, organizational structure, and the role of the chief executive officer in a combined company.

On August 30, 2022, Ms. Burzik and several members of the Orthofix Board spoke by videoconference with Dr. Essig to discuss the process for determining the composition of the combined company’s executive leadership team and an initial timeline for the proposed transaction through the execution of the definitive agreement.

Also on August 30, 2022, representatives of Hogan Lovells spoke by telephone with representatives of DLA to discuss structuring the proposed transaction between Orthofix and SeaSpine and the drafting responsibilities and timing for the preparation of an initial draft of a definitive agreement.

On August 30 and August 31, 2022, representatives of Party A reiterated to SeaSpine that Party A was unlikely to increase the value that it had presented in its non-binding indication of interest.

On August 31, 2022, Mr. Serbousek and Mr. Valentine held an in-person meeting in Dallas, Texas to discuss their respective views on talent engagement and retention.

On September 2, 2022, the Orthofix Board held a meeting to discuss the potential business combination with SeaSpine. Representatives of Perella Weinberg and members of Orthofix management also attended the

 

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meeting. The Orthofix Board discussed with Orthofix management and representatives of Perella Weinberg the status of the proposed due diligence process, the preparation of a draft definitive agreement by Hogan Lovells and an initial timeline for the proposed transaction through the execution the execution of the definitive agreement.

Also on September 2, 2022, the SeaSpine Board held a meeting to discuss the potential business combination with Orthofix. Representatives of Piper Sandler and DLA and members of SeaSpine management attended the meeting and provided the SeaSpine Board with an update on due diligence, including the status of the virtual data room and scheduling calls, and discussions regarding the governance and executive leadership team for the combined company.

Later on September 2, 2022, Ms. Burzik and Dr. Essig spoke by telephone regarding the roles and responsibilities of the Chief Executive Officer and of the Executive Chairman of the combined company’s board.

During the period from September 2, 2022 through October 10, 2022, representatives and advisors of Orthofix reviewed materials provided by SeaSpine, including through SeaSpine’s online electronic data room that became available on September 6, 2022, and engaged in business and legal due diligence discussions by telephone with various representatives and advisors of SeaSpine, and submitted a number of requests for additional due diligence information. During this same period, representatives and advisors of SeaSpine reviewed materials provided by Orthofix, including through Orthofix’s online electronic data room that became available on September 6, 2022, and engaged in business and legal due diligence discussions by telephone with various representatives and advisors of Orthofix, and submitted a number of requests for additional due diligence information. During this period, both Orthofix and SeaSpine continually updated their respective electronic data rooms based on requests received from the other party and its advisors.

Between September 2, 2022 and October 10, 2022, members of Orthofix management and SeaSpine management and their respective legal and financial advisors held frequent discussions regarding due diligence.

On September 8, 2022, representatives of Hogan Lovells sent an initial draft of a merger agreement to representatives of DLA. The draft agreement required, among other things, each party to pay a termination fee in the event the party terminated the agreement in order to enter into another agreement and under certain other circumstances, equal to approximately 3.5% of the transaction value on the date of signing. The draft agreement also included a customary non-solicitation provision with respect to competing proposals, largely reciprocal representations and warranties and a closing condition regarding the delivery of a legal opinion with respect to the tax treatment of the transaction.

During the period between September 8, 2022 and the execution of the merger agreement on October 10, 2022, each of Orthofix and SeaSpine management and their respective financial advisors and outside counsel spent significant time negotiating the terms of the transaction, including, in particular: the circumstances in which Orthofix and SeaSpine could consider unsolicited acquisition proposals made by third parties as well as the terms upon which Orthofix and SeaSpine might be required to pay a fee upon termination of the merger agreement and the amount of any such termination fee; the commitments to achieve satisfaction of conditions to closing, including regulatory approvals; the remedies available to either party in the event of termination or breach of the merger agreement; the conditions to the consummation of the merger; the definition of material adverse effect; and the scope of, and qualifications to, the representations and warranties. During this period, the parties exchanged multiple drafts of the merger agreement and negotiated the disclosure schedules to the merger agreement.

On September 9, 2022, Mr. Serbousek and Mr. Valentine spoke by telephone to discuss personnel matters with respect to the combined company and the anticipated location of the combined company’s primary offices.

Later on September 9, 2022, the Orthofix Board held a meeting to discuss the potential business combination with SeaSpine. Members of Orthofix management and representatives of Perella Weinberg also

 

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attended the meeting. The Orthofix Board discussed with Orthofix management and representatives of Perella Weinberg the status of due diligence, the draft merger agreement and discussions regarding the executive leadership team for the combined company.

Also on September 9, 2022, Mr. Valentine and the Party A chief executive officer spoke by telephone to preview a potential Party A revised proposal that would reflect an all-stock deal structure. During the discussion, Party A represented that they would be willing to offer a 15% premium to the current trading price of the SeaSpine common stock.

Later on September 9, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and representatives of Piper Sandler and DLA. Members of SeaSpine management and Piper Sandler presented the updated Party A non-binding indication of interest received earlier that day and the terms thereof. Representatives of Piper Sandler also reviewed with the SeaSpine Board certain financial aspects of the non-binding indication of interest from Orthofix. Representatives of DLA discussed with the SeaSpine Board the directors’ fiduciary duties in the context of reviewing and analyzing a potential business combination transaction.

On September 10, 2022, Ms. Burzik and Dr. Essig spoke by telephone regarding the progress on each party’s due diligence review and the timing of each party’s upcoming meetings of its board of directors.

On September 12, 2022, Party A informed SeaSpine management that Party A could potentially provide a revised proposal that would represent a 30-32% premium to the current trading price of SeaSpine common stock. On September 14, 2022, Party A provided Mr. Valentine with a revised non-binding indication of interest that included an $8.60 per share value (which was approximately a 32% premium to the current trading price of SeaSpine common stock) in an all stock, fixed price transaction, but which also indicated that Party A would require 45 days to complete its due diligence. Mr. Valentine promptly conveyed the revised non-binding indication of interest to the SeaSpine Board.

On September 14, 2022, the Orthofix Board held a meeting, together with members of Orthofix management, to discuss change of control compensation and benefits in connection with the proposed business combination, including the proposed treatment of equity compensation awards at both Orthofix and SeaSpine. Management also provided the Orthofix Board with an update on the status of due diligence and the negotiations with SeaSpine on the draft definitive agreement. After subsequently meeting in executive session without management present, the Orthofix Board determined to treat the transaction, if consummated, as a “change in control” under applicable Orthofix executive compensation agreements and equity plans.

On September 15, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and representatives of DLA. Representatives of DLA discussed with the SeaSpine Board the directors’ fiduciary duties in the context of reviewing and analyzing a potential business combination transaction. The SeaSpine Board discussed the revised non-binding indication of interest from Party A provided on September 14, 2022, as well as materials provided by representatives of Piper Sandler reviewing certain financial aspects of the non-binding indications of interests from Orthofix and Party A, which materials a representative of Piper Sandler had reviewed with the SeaSpine Board the previous evening. The SeaSpine Board discussed potential challenges arising from a transaction with Party A, including concerns around timing, regulatory approvals, synergies and other potential issues for the combined company. Following discussion, the SeaSpine Board determined that the terms presented in the Party A non-binding indication of interest did not, at that time, provide the SeaSpine stockholders with sufficient value given the expressed concerns.

On September 16, 2022, the Orthofix Board held a meeting to discuss the potential business combination with SeaSpine. Members of Orthofix management and representatives of Perella Weinberg also attended the meeting. The Orthofix Board discussed with Orthofix management and representatives of Perella Weinberg the proposed investor communications plan to be implemented upon announcement of the proposed business combination and the status of due diligence and the negotiations with SeaSpine on the draft merger agreement.

 

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On September 17, 2022, Ms. Burzik and Dr. Essig began holding weekly telephone calls to share updates on matters related to the transaction, including with respect to due diligence, composition of the board and executive leadership team for the combined company, and timing to complete due diligence and negotiation of the definitive agreement.

On September 18, 2022, Ms. Burzik and Mr. Valentine met in-person in Carlsbad, California to discuss the role of the chief executive officer in the combined company.

On September 20, 2022, representatives of Piper Sandler called members of Party A management to discuss the Party A revised non-binding indication of interest dated September 14. Party A emphasized the fixed $8.60 per share value and that Party A would require 45 days to complete its due diligence. Following this discussion, representatives of Piper Sandler informed Party A that the Party A revised non-binding indication of interest was not competitive on timing or certainty of transaction execution.

On September 21, 2022, members of Orthofix management and SeaSpine management, along with representatives from each of Perella Weinberg and Piper Sandler, met by videoconference to discuss the ongoing negotiations with respect to the draft merger agreement and the status of due diligence.

On September 21, 2022, Mr. Valentine met in person in San Diego County, California with the Party A chief executive officer to discuss the assumptions underlying the Party A revised non-binding indication of interest delivered to SeaSpine on September 14, 2022.

On September 23, 2022, the SeaSpine Board held a meeting. Members of SeaSpine management and representatives of Piper Sandler and DLA attended the meeting and provided the SeaSpine Board with an update on negotiations with Orthofix on the draft merger agreement and status of due diligence. Representatives of Piper Sandler reviewed with the SeaSpine Board certain financial aspects of each of the non-binding indications of interests from Party A and Orthofix.

Also on September 23, 2022, the Orthofix Board held a meeting to discuss the potential business combination with SeaSpine. Members of Orthofix management attended the meeting and provided the Orthofix Board with an update on status of Orthofix’s due diligence review of SeaSpine and described the material risks identified by Orthofix during the due diligence process. Members of Orthofix management also provided the Orthofix Board with an update on the status of negotiations with Orthofix on the draft merger agreement, the development of the communications plan and the preliminary financial analysis of the combined company.

Later on September 23, 2022, Mr. Serbousek and Mr. Valentine spoke by telephone to discuss the anticipated timing of the announcement of the proposed business combination.

Also on September 23, 2022, members of Orthofix management and SeaSpine management, along with representatives of Perella Weinberg and Piper Sandler, met by videoconference to discuss the status of the financial due diligence, the availability of the Orthofix credit facility to the combined company and a preliminary financial analysis of the combined company.

On September 24, 2022, Ms. Burzik and Dr. Essig spoke by telephone regarding the status of due diligence and the anticipated timing of the announcement of the proposed business combination.

On September 27, 2022, members of Orthofix management and SeaSpine management, along with representatives from Perella Weinberg and Piper Sandler, met by videoconference to discuss the status of the ongoing negotiations with respect to the draft merger agreement and due diligence review as well as the anticipated timing of the announcement of the proposed business combination.

Later on September 27, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and representatives of Piper Sandler and DLA. At the invitation of the SeaSpine Board, the Party A chief executive officer attended a portion of the meeting. At the meeting, Party A’s chief executive officer presented Party

 

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A’s rationale for and the potential benefits of a SeaSpine-Party A business combination as outlined in the revised non-binding indication of interest from September 14, including a discussion regarding timing for completion of such a transaction and potential challenges to complete a business combination. Following this presentation, Party A’s chief executive officer left the meeting and members of SeaSpine management provided the SeaSpine Board with an update on the ongoing negotiations with Orthofix with respect to the draft merger agreement.

On September 28, 2022, the Orthofix Board of directors held a regular meeting. Members of Orthofix management attended the meeting and provided the Orthofix Board with an update on the ongoing negotiations with SeaSpine, as well as the status of Orthofix’s due diligence review of SeaSpine, including an overview of material risks identified by Orthofix during the due diligence process. Representatives of Hogan Lovells attended a portion of the meeting and reviewed with the Orthofix Board the materials terms of the draft merger agreement and discussed with the Orthofix Board of directors the directors’ fiduciary duties in the context of reviewing and evaluating a potential business combination transaction. Representatives of Perella Weinberg also attended a portion of the meeting and discussed with Orthofix Board an updated preliminary financial analysis, prepared by Perella Weinberg at the direction of the Orthofix Board and based on public data and input from Orthofix and SeaSpine management, with respect to the potential business combination.

On September 30, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and representatives of Piper Sandler and DLA. Members of SeaSpine management provided the SeaSpine Board with an update on the ongoing negotiations with Orthofix with respect to the draft merger agreement. Members of SeaSpine management and representatives of Piper Sandler provided the SeaSpine Board with an update on the status of discussions with Party A. Representatives of Piper Sandler reviewed with the SeaSpine Board certain financial aspects of each of the non-binding indications of interests from Party A and Orthofix. After discussion, the SeaSpine Board directed Piper Sandler to reiterate to Party A that Party A’s revised non-binding indication of interest from September 14 was not competitive with respect to timing or certainty.

Also on September 30, 2022, Ms. Burzik and Dr. Essig spoke by telephone regarding the status of due diligence and the anticipated timing of the announcement of the proposed business combination.

Later on September 30, 2022, members of Orthofix management and SeaSpine management, along with representatives of Perella Weinberg and Piper Sandler, met by videoconference to discuss the proposed investor communications plan to be implemented upon announcement of the proposed business combination.

On October 3, 2022, the Orthofix Board held a meeting to discuss the potential business combination with SeaSpine. Members of Orthofix management and representatives of Perella Weinberg attended the meeting and discussed with the Orthofix Board the proposed investor communications plan to be implemented upon announcement of the proposed business combination and provided the Orthofix Board with an update on the status of due diligence and the negotiations with SeaSpine on the draft merger agreement

On October 4, 2022 and October 5, 2022, representatives of Piper Sandler held calls with management of Party A and reiterated that Party A’s revised non-binding indication of interest from September 14 was not competitive with respect to timing or certainty. Following these calls, on October 6, 2022, Party A formally rescinded its non-binding indication of interest.

From October 4 through October 7, 2022, members of Orthofix management and SeaSpine management, along with representatives of Perella Weinberg and Piper Sandler, met daily by videoconference to discuss the status of due diligence, negotiations on the draft merger agreement, development of the investor communications plan and the anticipated timing of the announcement of the proposed business combination.

On October 6, 2022, Ms. Burzik and certain other members of the Orthofix Board spoke by telephone with Dr. Essig to discuss the treatment of the proposed transaction as a “change of control” for purposes of certain Orthofix executive compensation plans and agreements as well as a process for setting compensation for the Chief Executive Officer and Executive Chairman of the combined company.

 

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On October 8, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and certain representatives of Piper Sandler and DLA. Management and DLA provided an update on diligence matters and the negotiation of the draft merger agreement. Representatives of Piper Sandler reviewed with the SeaSpine Board their preliminary financial analyses relating to the fairness to the holders of SeaSpine common stock of the exchange ratio. Representatives of Piper Sandler also updated the SeaSpine Board to confirm the rescission of the non-binding indication of interest by Party A.

On October 9, 2022, Dr. Essig and Ms. Burzik held a call to discuss various matters, including a process for selecting non-executive directors of the combined company.

Later on October 9, 2022, the Orthofix Board held a meeting. Members of Orthofix management and representatives from Perella Weinberg and Hogan Lovells attended the meeting. In advance of the meeting, the directors were provided with a near-final draft of the merger agreement and a summary of the key terms. At the meeting, Orthofix management referred the Orthofix Board to the detailed materials circulated on October 8, which included a draft fairness opinion from Perella Weinberg. Members of Orthofix management reported that the parties were in agreement on all significant deal points. Members of Orthofix management then provided the Orthofix Board with an update on the status and results of the Orthofix due diligence review. Representatives of Hogan Lovells reviewed with the Orthofix Board the material terms of the near-final draft of the merger agreement and discussed with the Orthofix Board the directors’ fiduciary duties in the context of reviewing and evaluating a potential business combination transaction. Representatives of Hogan Lovells also reviewed with the Orthofix Board the terms of, and considerations with respect to, an amendment to the forum selection bylaw in the Orthofix bylaws, including the scope of the amendment and the potential benefits of adopting the amendment. Members of Orthofix management reviewed with the Orthofix Board the financial projections prepared by Orthofix management and the underlying assumptions, which projections were to be used, at the Orthofix Board’s direction, by Perella Weinberg in the preparation of its fairness opinion. The Orthofix Board considered that Mr. Serbousek would be the Executive Chairman of the combined company, Ms. Burzik would be the lead independent director of the combined company’s board, several Orthofix directors would be directors at the combined company, and the compensation implications for Mr. Serbousek and other members of Orthofix’s management and board, including that the proposed transaction would be treated as a “change of control” for purposes of certain Orthofix executive compensation plans and agreements. Members of Orthofix management and the Orthofix Board discussed a number of factors, including those outlined under “—Orthofix Board’s Recommendation and Reasons for the Merger” beginning on page 75 of this joint proxy statement/prospectus. In addition, representatives from Perella Weinberg discussed with the Orthofix Board the methodology, analyses and assumptions which were being considered in connection with its fairness analysis.

On October 10, 2022, Orthofix and its representatives and advisors and SeaSpine and its representatives and advisors finalized the merger agreement.

On October 10, 2022, the SeaSpine Board held a meeting, together with members of SeaSpine management and certain representatives of Piper Sandler and DLA. During the meeting, members of SeaSpine management updated the SeaSpine Board on the status of negotiations and due diligence between the companies. Representatives of DLA discussed with the SeaSpine Board their fiduciary duties and reviewed the terms of the final definitive merger agreement. Representatives of Piper Sandler reviewed with the SeaSpine Board their updated financial analyses relating to the fairness to the holders of SeaSpine common stock of the exchange ratio, and Piper Sandler rendered its oral opinion to the SeaSpine Board, (which was subsequently confirmed in writing by delivery of its written opinion, dated October 10, 2022), to the effect that, as of such date, and based upon and subject to the various assumptions and limitations set forth in its written opinion, the exchange ratio was fair, from a financial point of view, to the holders of SeaSpine common stock. See “—Opinion of SeaSpine’s Financial Advisor” beginning on page 91 of this joint proxy statement/prospectus. Members of SeaSpine management and the SeaSpine Board discussed a number of factors related to the merger, including those outlined under “—SeaSpine Board’s Recommendation and Reasons for the Merger” beginning on page 81 of this joint proxy statement/prospectus. Following discussion, the SeaSpine Board unanimously determined that

 

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the merger was fair to, and in the best interests of, SeaSpine and its stockholders, approved and declared advisable the merger agreement, the merger and the other transactions contemplated by the merger agreement, and resolved to recommend adoption of the merger agreement to holders of shares of SeaSpine’s common stock.

Also later on October 10, 2022, the Orthofix Board held a meeting. Members of Orthofix management and representatives from Perella Weinberg and Hogan Lovells also attended the meeting. In advance of the meeting, the directors were provided with the final form of merger agreement and an updated summary of the material terms reflected therein. Representatives of Hogan Lovells reviewed and discussed with the Orthofix Board the changes that had been made to the draft merger agreement since the draft that had been distributed to the Orthofix Board in advance of the October 9 meeting. Representatives from Perella Weinberg then orally rendered its opinion to the Orthofix Board, subsequently confirmed in writing, that, as of October 10, 2022, and based upon and subject to the various assumptions made, procedures followed, matters considered and limitations set forth therein, the exchange ratio in the merger pursuant to the merger agreement was fair, from a financial point of view, to Orthofix. The text of the Perella Weinberg opinion is attached as Annex B to this joint proxy statement/prospectus. Following additional discussion and deliberation, the Orthofix Board unanimously approved and declared advisable the merger agreement and the transactions contemplated by the merger agreement, including the merger and the issuance of shares of Orthofix common stock pursuant thereto, determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger and the issuance of shares of Orthofix common stock pursuant thereto, are fair to, and in the best interests of, Orthofix and its stockholders, resolved to recommend approval of the issuance of shares of Orthofix common stock pursuant to the merger agreement to holders of shares of Orthofix common stock, and directed that the issuance of shares of Orthofix common stock be submitted to the Orthofix stockholders for approval.

Later on October 10, 2022, after the close of trading on the Nasdaq Global Select Market, Orthofix, SeaSpine and Merger Sub executed the merger agreement.

On October 11, 2022, before the opening of trading on the Nasdaq Global Select Market, Orthofix and SeaSpine issued a joint press release announcing the execution of the merger agreement.

Orthofix Board’s Recommendation and Reasons for the Merger

On October 10, 2022, the Orthofix Board unanimously (1) approved and declared advisable the merger agreement and the transactions contemplated by the merger agreement, including the issuance of shares of Orthofix common stock in the merger, on the terms and subject to the conditions set forth in the merger agreement, (2) determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger and the issuance of Orthofix common shares in the merger, are fair to, and in the best interests of, Orthofix and its stockholders, on the terms and subject to the conditions set forth in the merger agreement, (3) resolved to recommend the approval of the Orthofix share issuance proposal to the Orthofix stockholders, on the terms and subject to the conditions set forth in the merger agreement, and (4) directed that the Orthofix share issuance proposal be submitted to Orthofix stockholders for approval.

In evaluating the merger agreement and the transactions contemplated by the merger agreement, including the merger and the issuance of Orthofix common stock in connection with the merger, the Orthofix Board consulted with Orthofix’s management and legal and financial advisors through an extensive strategic review and due diligence process. In reaching its decision, the Orthofix Board evaluated, among other things, the financial effects of the transactions from the perspective of Orthofix and its stockholders and the impact of the transactions on Orthofix and its business from a strategic and operational perspective. In recommending that Orthofix stockholders vote their shares of Orthofix common stock in favor of the Orthofix share issuance, the Orthofix Board considered a number of factors, including the following (not necessarily listed in order of relative importance):

 

   

Orthofix’s businesses and operations and its current and historical financial condition and results of operations;

 

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Orthofix’s strategic plan and related financial projections, the risks and uncertainties in executing on the strategic plan and achieving the financial projections, including risks related to consolidation and increased competition among participants in Orthofix’s industry, current dynamics and outlooks of Orthofix’s industry, and the “risk factors” set forth in Orthofix’s Annual Report on Form 10-K for the year ended December 31, 2021, and subsequent reports filed with the SEC;

 

   

The current and expected valuation of Orthofix common stock, as well as the historic trading ranges of Orthofix common stock and the potential trading range of Orthofix common stock absent announcement of the merger agreement;

 

   

Various analyses as to the valuation of Orthofix as an independent company, including to account for the anticipated earnings over time from the existing Orthofix business, including in comparison to the expected attractive valuation of the combined company in the future;

 

   

The perceived risks of Orthofix as a standalone public company and the assessment by the Orthofix Board, taking into account, among other things, its review of potential strategic options with the assistance of Orthofix management and Orthofix’s advisors;

 

   

That the merger of equals transaction allows Orthofix to strengthen its highly complementary spine and orthopedics portfolios by engaging in a merger of equals transaction that will address the high growth segments of the global spine and orthopedic markets;

 

   

The current competitive landscape for spine, orthopedics and biologics and regenerative product lines, including the competitive advantages of firms with significant scale and accelerated adoption of innovative and differentiated technologies across all channels;

 

   

The value creation potential that is expected to be enhanced in a combination with SeaSpine compared to the potential of Orthofix on a standalone basis, by increasing Orthofix’s competitive strengths across the spine and biologics product lines;

 

   

That the combined company’s financial strength and broad product offerings will allow it to sustain investment in rapid product innovation and introduction;

 

   

The combined company’s expected enhanced technology and research and development capabilities, which will help the combined company accelerate adoption of innovative and differentiated technologies across all product lines, which is expected to provide the combined company with additional growth opportunities as compared to Orthofix on a standalone basis and to enhance the combined company’s position as a leading global spine and orthopedics company;

 

   

The Orthofix Board’s belief that SeaSpine’s business profile — i.e., a concentrated product offering focused on spine and biologics that the Orthofix Board believes have attractive future growth prospects — would coincide well with Orthofix’s medium- and long-term strategic focus on having complementary portfolios bridging across growing markets, and enable the combined company not to be overly reliant on any single product that participates in slower growth markets;

 

   

That many of the same engineering, manufacturing, sales and distribution capabilities are required to support both the Orthofix and SeaSpine businesses, and the expected complementary capabilities and technology sharing enabled by bringing Orthofix and SeaSpine together, which are expected to enhance product offerings for surgeons and accelerate revenue opportunities beyond what Orthofix could have accomplished on its own over the medium- and long-term, including:

 

   

that Orthofix can capitalize on SeaSpine’s current and future products, which are expected to allow the combined company to enhance its products and win greater market share, and that SeaSpine’s spine business has a differentiated enabling technology in 7D Flash Navigation, which participates in one of the highest-growth segments in the spine industry;

 

   

that SeaSpine can capitalize on Orthofix’s capabilities, such as Orthofix’s financial resources, which are expected to enable the combined company to fund a leading portfolio of spine and biologic products in the future;

 

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The expected generation of more than $40 million of annual cost synergies, by the third year following completion of the merger, through the reduction of redundant overhead and public company costs;

 

   

The expected strong cash flow generation and balance sheet of the combined company, which is expected to provide for the development of the current and future commercialization of SeaSpine and Orthofix products;

 

   

The complementary cultures of Orthofix and SeaSpine, including a strong performance-based culture focused on integrity, collaboration, innovation, diversity and corporate social responsibility;

 

   

The fact that the merger agreement provides for a fixed exchange ratio and that no adjustment will be made in the merger consideration to be received by SeaSpine stockholders in the merger as a result of possible changes in the market price of Orthofix’s common stock following the announcement of the merger;

 

   

The benefits of an all-stock combination that allows Orthofix stockholders, as well as SeaSpine stockholders, to continue to participate in the significant upside of the combined company’s business;

 

   

The resulting percentage ownership interest that current Orthofix stockholders would have in the combined company following the merger;

 

   

The written opinion of Perella Weinberg, dated October 10, 2022, to the Orthofix Board, to the effect that, as of the date of such opinion, and based upon and subject to the various assumptions made, procedures followed, matters considered, and qualifications and limitations on the scope of the review undertaken by Perella Weinberg as set forth in such written opinion, the exchange ratio in the merger pursuant to the merger agreement was fair, from a financial point of view to Orthofix, as described in greater detail in the section entitled “— Opinion of Orthofix’s Financial Advisor.” The full text of the written opinion of Perella Weinberg, dated October 10, 2022, which sets forth assumptions made, procedures followed, matters considered and qualifications and limitations on the scope of review undertaken by Perella Weinberg in rendering its opinion, is attached as Annex B to this joint proxy statement/prospectus and is incorporated by reference herein in its entirety;

 

   

The structure of the transaction as a merger of equals, including the governance terms in the merger agreement providing that, among other things:

 

   

a highly independent board of directors, with seven (of nine) directors expected to be independent, including a Lead Independent Director;

 

   

the board of directors of the combined company would include five directors who are directors of Orthofix as of immediately prior to the completion of the merger, and four directors who are directors of SeaSpine as of immediately prior to the completion of the merger;

 

   

SeaSpine’s Chief Executive Officer prior to the completion of the merger would serve as the Chief Executive Officer of the combined company;

 

   

Orthofix’s Chief Executive Officer prior to the completion of the merger would serve as the Executive Chairman of the combined company; and

 

   

the belief of the Orthofix Board that the above-described arrangements would reasonably assure the continuity of the management and oversight of the combined company following completion of the merger and facilitate a strong management team drawn from both Orthofix and SeaSpine, leveraging the respective expertise of both management teams, to work together to integrate the two companies and provide a stable foundation for future management succession;

 

   

Orthofix’s ability under the merger agreement, subject to certain conditions, to provide information to and engage in discussions or negotiations with third parties that make unsolicited transaction proposals;

 

   

That if Orthofix were to receive an alternative transaction proposal that the Orthofix Board determines constitutes or would reasonably be expected to result in a superior proposal (as defined in “The Merger

 

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Agreement — Covenants and Agreements — No Solicitation; Board Recommendations”), the Orthofix Board would be able, subject to certain conditions, to consider the superior proposal and, subject to payment of approximately $13.7 million plus up to $2.0 million in expense reimbursement, terminate the merger agreement in order to accept a superior proposal;

 

   

The ability under the merger agreement for the Orthofix Board, subject to certain conditions, to change its recommendation in favor of the Orthofix share issuance proposal in response to an intervening event if the Orthofix Board determines in good faith that failure to take such action would be a breach of its fiduciary duties;

 

   

The termination provisions contained in the merger agreement, including the fact that the Orthofix Board believed that the termination fee it would have to pay SeaSpine in specified circumstances of approximately $13.7 million plus up to $2.0 million in expense reimbursement is reasonable in light of, among other things, the benefits of the merger to Orthofix stockholders, the typical size of such fees in similar transactions and the likelihood that such a fee would not preclude or unreasonably restrict the emergence of alternative transaction proposals, as well as the fact that generally no termination fee is payable by Orthofix to SeaSpine if Orthofix stockholders do not approve the Orthofix share issuance proposal and the Orthofix Board has not changed its recommendation to Orthofix stockholders to vote for such proposal so long as Orthofix has not breached certain provisions of the merger agreement, and that Orthofix would receive a termination fee of approximately $10.6 million plus up to $2.0 million in expense reimbursement from SeaSpine in specified circumstances;

 

   

The outside date under the merger agreement, taking into account the ability of Orthofix or SeaSpine to extend the initial March 10, 2023, outside date in specified circumstances to June 10, 2023, (as more fully described in the section entitled “The Merger Agreement — Termination”), which is expected to allow for sufficient time to complete the merger;

 

   

The likelihood that the parties would complete the merger taking into account the commitments by Orthofix and SeaSpine to obtain applicable consents and approvals under regulatory laws;

 

   

The Orthofix Board’s knowledge of SeaSpine, taking into account publicly available information regarding SeaSpine and the results of Orthofix’s due diligence review of SeaSpine;

 

   

The Orthofix Board’s understanding of the current valuation of SeaSpine common stock, as well as the historic trading ranges of SeaSpine common stock;

 

   

The fact that the merger agreement was the product of arm’s-length negotiations and contained terms and conditions that are, in the Orthofix Board’s view, favorable to Orthofix and its stockholders;

 

   

The fact that the merger agreement was unanimously approved by the Orthofix Board, which is comprised of a majority of independent directors who are not affiliated with SeaSpine and are not employees of Orthofix or any of its subsidiaries, and which received advice from Orthofix’s financial and legal advisors in evaluating, negotiating and recommending the terms of the merger agreement;

 

   

The condition to completing the merger that the Orthofix share issuance must be approved by the affirmative vote of a majority in voting power of the shares of Orthofix common stock present in person or represented by proxy at the Orthofix special meeting and entitled to vote thereon and the SeaSpine merger proposal must be approved by the affirmative vote of the holders of a majority of the shares of SeaSpine common stock outstanding as of the SeaSpine record date and entitled to vote on the proposal, and the absence of any stock voting commitments by management or other stockholders, so that Orthofix stockholders and SeaSpine stockholders will have the right to approve or disapprove of the Orthofix share issuance proposal and the SeaSpine merger proposal; and

 

   

Orthofix’s ability to specifically enforce SeaSpine’s obligations under the merger agreement, including SeaSpine’s obligations to complete the merger.

 

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The Orthofix Board also considered a number of uncertainties, risks and other factors in its deliberations concerning the merger and the other transactions contemplated by the merger agreement, including the following (not necessarily listed in order of relative importance):

 

   

The fact that Orthofix stockholders would forgo the opportunity to realize the potential value of Orthofix as a standalone public company;

 

   

The fact that the value of the merger consideration payable to SeaSpine stockholders could increase in the event that the Orthofix stock price or the value of the Orthofix business increases prior to the completion of the merger;

 

   

The fact that, under specified circumstances, Orthofix may be required to pay an approximate $13.7 million termination fee plus $2.0 million in expenses in the event the merger agreement is terminated and the effect this could have on Orthofix, including the possibility that the termination fee payable by Orthofix to SeaSpine upon the termination of the merger agreement in specified circumstances could discourage some potential transaction counterparties from making a transaction proposal, although the Orthofix Board believes that the termination fee is reasonable in amount and would not unduly deter any other party that might be interested in combining with Orthofix;

 

   

The ability of the SeaSpine Board upon SeaSpine’s receipt of an alternative transaction proposal that the SeaSpine Board determines constitutes or would reasonably be expected to result in a superior proposal, to, subject to certain conditions, consider the superior proposal and, subject to payment of approximately $10.6 million plus up to $2.0 million in expense reimbursement, terminate the merger agreement in order to accept a superior proposal;

 

   

The risk that the termination fee of approximately $10.6 million plus expense reimbursement of up to $2.0 million SeaSpine may be required to pay Orthofix in the event the merger agreement is terminated under specified circumstances may not be sufficient to compensate Orthofix for the harm it might suffer as a result of such termination;

 

   

The fact that the market price of Orthofix common stock could be affected by many factors if the merger agreement were terminated, including: (1) the reason or reasons for such termination and whether such termination resulted from factors adversely affecting Orthofix, (2) the possibility that, as a result of the termination of the merger agreement, possible transaction partners may consider Orthofix to be a less attractive transaction partner and (3) the possible sale of Orthofix common stock by short-term investors following an announcement that the merger agreement was terminated;

 

   

The time, effort and substantial costs involved with entering into the merger agreement and completing the merger and the related disruptions to the operation of Orthofix’s business, including the risk of diverting management’s attention from other strategic priorities to implement merger integration efforts;

 

   

The challenges inherent in combining the Orthofix business and the SeaSpine business;

 

   

The restrictions in the merger agreement on Orthofix’s conduct of business prior to the completion of the merger, which could delay or prevent Orthofix from undertaking business opportunities that may arise, or taking other actions with respect to its operations that the Orthofix Board and management might believe were appropriate or desirable;

 

   

The fact that there can be no assurance that all conditions to the parties’ obligations to complete the merger will be satisfied;

 

   

The fact that the completion of the merger would require approval under or expiration or termination of the applicable waiting periods under the HSR Act, the risk that regulatory agencies may not approve the merger or may impose terms and conditions on their approvals that adversely affect the business and financial results of the combined company, and the amount of time that might be required to obtain all required regulatory consents and approvals;

 

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The risk that the Orthofix stockholders do not approve the Orthofix share issuance proposal and/or the SeaSpine stockholders do not approve the SeaSpine merger proposal;

 

   

The impact of the announcement, pendency or completion of the merger, or the failure to complete the merger, on Orthofix’s relationships with its employees (including making it more difficult to attract and retain key personnel and the possible loss of key management, technical and other personnel), customers and suppliers;

 

   

The fact that Orthofix stockholders will not be entitled to exercise appraisal or dissenters’ rights in connection with the merger;

 

   

The risk of litigation, injunctions or other legal proceedings related to the transactions contemplated by the merger agreement; and

 

   

The risks of the type and nature described under “Risk Factors,” and the matters described under “Cautionary Note Regarding Forward-Looking Statements.”

The Orthofix Board believed that, overall, the merger and the other transactions contemplated by the merger agreement were a unique opportunity, and after taking into account the foregoing risks, the Orthofix Board determined that because the possible future of the combined company was so attractive and promising, the merger and the other transactions contemplated by the merger agreement were overwhelmingly in the interest of Orthofix stockholders.

This discussion of the information and factors considered by the Orthofix Board in reaching its conclusions and recommendation includes the principal factors considered by the Orthofix Board, but is not intended to be exhaustive and may not include all of the factors considered by the Orthofix Board. In view of the wide variety of factors considered in connection with its evaluation of the merger and the other transactions contemplated by the merger agreement, and the complexity of these matters, the Orthofix Board did not find it useful and did not attempt to quantify, rank or assign any relative or specific weights to the various factors that it considered in reaching its determination to approve and declare advisable the merger agreement and the transactions contemplated by the merger agreement, including the merger, and to make its recommendation to Orthofix stockholders. Rather, the Orthofix Board viewed its decisions as being based on the totality of the information presented to it and the factors it considered, including its discussions with, and questioning of, members of Orthofix’s management and Orthofix’s advisors, as well as the directors’ individual experiences and expertise. In addition, individual members of the Orthofix Board may have assigned different weights to different factors.

Orthofix’s directors and executive officers may have interests in the merger that are different from, or in addition to, those of Orthofix stockholders generally. The Orthofix Board was aware of and considered these potential interests, among other matters, in evaluating the merger and in making its recommendation to Orthofix stockholders. For a discussion of these interests, see the section entitled “Interests of Orthofix’s Directors and Executive Officers in the Merger.”

For the reasons set forth above, the Orthofix Board has unanimously (i) determined that the merger agreement and the other transactions contemplated thereby, including the issuance of shares of Orthofix common stock in the merger, are advisable and in the best interests of Orthofix and the Orthofix stockholders, (ii) authorized, approved and adopted the merger agreement and authorized the issuance of shares of Orthofix common stock in the merger and (iii) directed that the issuance of shares of Orthofix common stock in the merger be submitted for consideration at the special meeting and recommended that the Orthofix stockholders vote in favor of the issuance of shares of Orthofix common stock. Accordingly, the Orthofix Board unanimously recommends that Orthofix stockholders vote “FOR” the Orthofix share issuance proposal at the Orthofix special meeting.

 

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THE ORTHOFIX BOARD UNANIMOUSLY RECOMMENDS THAT ORTHOFIX STOCKHOLDERS VOTE “FOR” THE ORTHOFIX SHARE ISSUANCE PROPOSAL AND “FOR” THE ORTHOFIX ADJOURNMENT PROPOSAL.

SeaSpine Board’s Recommendation and Reasons for the Merger

On October 10, 2022, after careful consideration the SeaSpine Board unanimously (1) approved and declared advisable the merger agreement and the transactions contemplated by the merger agreement, (2) determined that the merger agreement and the transactions contemplated by the merger agreement, including the merger and the merger consideration, are fair to, and in the best interests of, SeaSpine and SeaSpine’s stockholders, (3) resolved to recommend the approval of the adoption of merger agreement to the SeaSpine stockholders and (4) directed that the adopting merger agreement be submitted to SeaSpine stockholders for approval.

In reaching its decision to approve, and declare advisable, the merger agreement and to recommend that SeaSpine’s stockholders adopt the merger agreement, the SeaSpine Board, as described above in the section entitled “— Background of the Merger” beginning on page 59 of this joint proxy statement/prospectus, held a number of meetings, consulted with SeaSpine’s management and its legal and financial advisors and considered a number of factors, including its knowledge of the business, assets and liabilities, results of operations, financial performance, strategic direction and prospects of each of SeaSpine, Orthofix and the combined company following the merger (taking into account the results of SeaSpine’s due diligence of Orthofix), as well as the risks in achieving those prospects and the anticipated effects of the merger. The SeaSpine Board considered a variety of factors that weighed positively in favor of the merger agreement, the merger and the other transactions contemplated by the merger agreement. These factors included the following, which are not necessarily in order of importance:

 

   

SeaSpine’s businesses and operations and its current and historical financial condition and results of operations;

 

   

SeaSpine’s strategic plan and related financial projections, the risks and uncertainties in executing on the strategic plan and achieving the financial projections, risks and uncertainties related to potential financing transactions and the potential dilution to existing stockholders from such transactions, risks related to consolidation and increased competition among participants in SeaSpine’s industry, current dynamics and outlooks of SeaSpine’s industry, and the “risk factors” set forth in SeaSpine’s Annual Report on Form 10-K for the year ended December 31, 2021, and subsequent reports filed with the SEC;

 

   

the current and expected valuation of SeaSpine common stock, as well as the historic trading ranges of SeaSpine common stock and the potential trading range of SeaSpine common stock absent announcement of the merger agreement;

 

   

the expectation that the merger would create a larger, premier spine and orthopedics company;

 

   

the highly complementary nature of SeaSpine’s and Orthofix’s businesses, products and geographic markets;

 

   

the expectation that the combined company will be better positioned to pursue an aggressive growth strategy in comparison to SeaSpine on a stand-alone basis;

 

   

the belief that the combined company, in light of its larger scale, more comprehensive product offerings and market presence, will be better positioned to meet the challenges facing the spinal and orthopedic industries, including regulatory, financial, and economic challenges;

 

   

the opportunity for the combined company to generate annual cost synergies of more than $40 million by the third year following completion of the merger, through the reduction of redundant overhead and public company costs;

 

   

the fact that SeaSpine stockholders will own approximately 43.5% of the combined company immediately following completion of the merger;

 

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the fact that the exchange ratio is fixed; the potential opportunity for SeaSpine stockholders to participate in a more diversified business profile as compared to SeaSpine’s business, financial condition, financial performance, competitive position, assets and future prospects as a standalone company;

 

   

current industry, economic and market conditions and trends;

 

   

the risks and uncertainties of alternative means of creating stockholder value and pursuing SeaSpine’s strategic goals;

 

   

the expectation that the merger will result in greater value to SeaSpine stockholders than the value that could be expected to be generated from the various other strategic alternatives available to SeaSpine; the fact that the per share price implied by the exchange ratio of 0.4163 represents a 39% premium to the closing price of a share of SeaSpine common stock on October 7, 2022, and a 20% and 16% premium for the 30 and 90 day trading periods (based on SeaSpine’s volume weighted average price), respectively, ending October 7, 2022;

 

   

the fact that the merger is intended to qualify as a tax-free reorganization;

 

   

SeaSpine’s knowledge of Orthofix’s business, operations, operating results, financial condition, strategy and future prospects;

 

   

The written opinion of Piper Sandler delivered to the SeaSpine Board on October 10, 2022, to the effect that, as of such date and based upon and subject to the assumptions made, procedures followed, matters considered and limitations on the scope of the review undertaken by Piper Sandler in rendering its written opinion, the exchange ratio was fair, from a financial point of view, to the holders of SeaSpine common stock, as more fully described below under “— Opinion of SeaSpine’s Financial Advisor,” which full text of the written opinion is attached as Annex C to this joint proxy statement/prospectus and is incorporated by reference in this joint proxy statement/prospectus in its entirety;

 

   

the fact that, subject to compliance with the terms and conditions of the merger agreement, SeaSpine is permitted to conduct negotiations with third parties and to terminate the merger agreement in order to accept a superior proposal;

 

   

the limited number of conditions to the merger and the commitment made by the parties to cooperate and use reasonable best efforts to obtain regulatory clearances;

 

   

the fact that during its negotiations with Orthofix, SeaSpine received an indication of interest from a third party, which the SeaSpine Board concluded was of higher risk, less certainty, and not as strong an opportunity;

 

   

the risks and uncertainties of SeaSpine continuing to pursue its long-term business plan as an independent public company;

 

   

the governance arrangements contained in the merger agreement; and the fact that the combined company is expected to have in the range of $150 million in available liquidity upon completion of the merger; and

 

   

the expectation that the merger will result in greater value to the SeaSpine stockholders than the value that could be expected to be generated from the various other strategic alternatives available to SeaSpine.

The SeaSpine Board also considered a variety of risks and other potentially negative factors concerning the merger. These factors included the following, which are not necessarily listed in order of importance:

 

   

the fact that SeaSpine stockholders will own a smaller percentage in the combined company than SeaSpine stockholders own in SeaSpine currently;

 

   

the difficulty and costs inherent in the combination of SeaSpine and Orthofix;

 

   

that SeaSpine’s management anticipates some revenue dis-synergies as a result of the merger;

 

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the risk that the combined company may face liquidity challenges during the next few years;

 

   

the fact that the exchange ratio will not adjust to compensate for changes in the price of Orthofix shares or SeaSpine shares prior to the consummation of the merger;

 

   

the potential adverse impact of business uncertainty prior to the effectiveness of the merger;

 

   

the potential consequences of non-consummation of the merger; the fact that one of Orthofix’s spine products has recently generated lower sales;

 

   

the risk that SeaSpine stockholders or Orthofix stockholders may fail to approve the merger;

 

   

the risk that the merger might not be completed in a timely manner;

 

   

risks related to regulatory approvals necessary to complete the merger;

 

   

risks related to certain terms of the merger agreement (including restrictions on the conduct of SeaSpine’s business prior to completion of the merger and the requirement that SeaSpine pay Orthofix a termination fee and expense reimbursement in certain circumstances); and

 

   

risks related to the diversion of management and resources from other strategic opportunities.

THE SEASPINE BOARD UNANIMOUSLY RECOMMENDS THAT SEASPINE STOCKHOLDERS VOTE “FOR” THE SEASPINE MERGER PROPOSAL, “FOR” THE SEASPINE MERGER-RELATED COMPENSATION PROPOSAL AND “FOR” THE  SEASPINE ADJOURNMENT PROPOSAL.

Opinion of Orthofix’s Financial Advisor

The Orthofix Board retained Perella Weinberg to act as its financial advisor in connection with the merger. The Orthofix Board requested that Perella Weinberg undertake a study to consider the fairness, from a financial point of view, to Orthofix, of the Exchange Ratio (as defined below) in the merger pursuant to the merger agreement. On October 10, 2022, Perella Weinberg rendered to the Orthofix Board its oral opinion, subsequently confirmed in writing, that, as of such date and based upon and subject to the various assumptions made, procedures followed, matters considered and qualifications and limitations set forth therein, the exchange ratio of 0.4163 shares of Orthofix common stock to be received for each share of SeaSpine common stock (other than shares of SeaSpine common stock that are owned by Orthofix, Merger Sub, any direct or indirect wholly-owned subsidiaries of Orthofix or SeaSpine, or by SeaSpine as treasury shares) (such exchange ratio, the “Exchange Ratio”) in the merger pursuant to the merger agreement was fair, from a financial point of view, to Orthofix.

The full text of Perella Weinberg’s written opinion, dated October 10, 2022, which sets forth, among other things, the assumptions made, procedures followed, matters considered and qualifications and limitations on the review undertaken by Perella Weinberg, is attached as Annex B to this joint proxy statement/prospectus and is incorporated by reference herein.

Perella Weinberg’s opinion was addressed to and provided for the information and assistance of the Orthofix Board, in its capacity as such, in connection with, and for the purpose of, the Orthofix Board’s evaluation of the Exchange Ratio from a financial point of view, and does not address any other term, aspect or implication of the merger agreement or the merger. Perella Weinberg’s opinion does not address the underlying decision by Orthofix to engage in the merger nor the relative merits of the merger compared with any alternative transactions or business strategies. Perella Weinberg’s opinion was not intended to be and does not constitute a recommendation to any holder of shares of Orthofix common stock as to how such holder should vote or otherwise act with respect to the merger or any other matter. Perella Weinberg’s opinion does not in any manner address what the value of shares of SeaSpine common stock actually will be when issued or the prices at which shares of Orthofix common stock or SeaSpine common stock will trade at any time, including following announcement or completion of the merger. In addition, Perella Weinberg expressed no opinion as to the fairness of the merger to the holders of any other class of securities, creditors or other constituencies of Orthofix. The description of Perella Weinberg’s opinion set forth below is qualified in its entirety by reference to the full text of the opinion.

 

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In arriving at its opinion, Perella Weinberg, among other things:

 

  1.

reviewed certain publicly available financial statements and other publicly available business and financial information with respect to Orthofix and SeaSpine, including equity research analyst reports;

 

  2.

reviewed certain internal financial statements, analyses and forecasts, as described in the section entitled “Certain Unaudited Prospective Financial Information Certain Orthofix Unaudited Prospective Financial Information” (the “Orthofix Forecasts”) and other internal financial information and operating data relating to the business of Orthofix, in each case, prepared by management of Orthofix and approved for Perella Weinberg’s use by management of Orthofix;

 

  3.

reviewed certain internal financial statements, analyses and forecasts, as described in the section entitled “Certain Unaudited Prospective Financial Information Certain SeaSpine Unaudited Prospective Financial Information” (the “SeaSpine Forecasts”) and other internal financial information and operating data relating to the business of SeaSpine, in each case, prepared by management of SeaSpine and approved for Perella Weinberg’s use by management of Orthofix;

 

  4.

discussed the past and current business, operations, financial condition and prospects of Orthofix and the combined company with senior management of Orthofix, the Orthofix Board, and other representatives and advisors of Orthofix;

 

  5.

discussed the past and current business, operations, financial condition and prospects of SeaSpine and the combined company with senior executives of Orthofix and SeaSpine, the Orthofix Board, and other representatives and advisors of Orthofix and SeaSpine;

 

  6.

discussed with members of the senior managements of Orthofix and SeaSpine their assessment of the strategic rationale for, and the potential benefits of, the merger;

 

  7.

reviewed certain estimates as to the amount and timing of certain cost savings and related expenses, operating efficiencies and financial synergies anticipated by management of Orthofix to result from the consummation of the merger (the “Synergies”) as approved for Perella Weinberg’s use by the management of Orthofix;

 

  8.

compared the financial performance of Orthofix and SeaSpine with that of certain publicly-traded companies which Perella Weinberg believed to be generally relevant;

 

  9.

reviewed the historical trading prices and trading activity for the Orthofix common stock and the SeaSpine common stock and compared such price and trading activity with that of securities of certain publicly-traded companies which Perella Weinberg believed to be generally relevant;

 

  10.

participated in discussions among representatives of Orthofix and SeaSpine and their respective advisors;

 

  11.

reviewed a draft of the merger agreement dated October 10, 2022; and

 

  12.

conducted such other financial studies, analyses and investigations, and considered such other factors, as Perella Weinberg deemed appropriate.

For purposes of its opinion, Perella Weinberg assumed and relied upon, without assuming any responsibility for independent verification, the accuracy and completeness of all of the financial, accounting, legal, tax, regulatory and other information provided to, discussed with or reviewed by Perella Weinberg (including information that was available from public sources) and further relied upon the assurances of management of Orthofix that they were not aware of any facts or circumstances that would make such information inaccurate or misleading in any material respect. With respect to the Orthofix Forecasts, Perella Weinberg was advised by management of Orthofix and assumed, with Orthofix’s consent, that they were reasonably prepared on bases reflecting the best currently available estimates and good faith judgments of management of Orthofix as to the future financial performance of Orthofix and the other matters covered thereby and Perella Weinberg expressed no view as to the reasonableness of the assumptions on which they were based. With respect to the SeaSpine

 

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Forecasts, Perella Weinberg was advised by management of SeaSpine and assumed, with Orthofix’s consent, that they were reasonably prepared on bases reflecting the best currently available estimates and good faith judgments of management of SeaSpine as to the future financial performance of SeaSpine and the other matters covered thereby and Perella Weinberg expressed no view as to the reasonableness of the assumptions on which they were based. Perella Weinberg assumed, with Orthofix’s consent, that the Synergies and potential strategic implications and operational benefits (including the amount, timing and achievability thereof) anticipated by the managements of Orthofix and SeaSpine to result from the merger will be realized in the amounts and at the times projected by the managements of Orthofix and SeaSpine, and Perella Weinberg expressed no view as to the assumptions on which they were based. In arriving at its opinion, Perella Weinberg did not make and was not provided with any independent valuation or appraisal of the assets or liabilities (including any contingent, derivative or off-balance-sheet assets or liabilities) of Orthofix, SeaSpine or any of their respective subsidiaries. Perella Weinberg did not assume any obligation to conduct, nor did Perella Weinberg conduct, any physical inspection of the properties or facilities of Orthofix, SeaSpine or any other party. In addition, Perella Weinberg did not evaluate the solvency of any party to the merger agreement, or the impact of the merger thereon, including under any applicable laws relating to bankruptcy, insolvency or similar matters.

Perella Weinberg assumed that the final merger agreement would not differ from the draft of the merger agreement reviewed by it in any respect material to its analysis or opinion. Perella Weinberg also assumed that (i) the representations and warranties of all parties to the merger agreement and all other related documents and instruments that were referred to therein were true and correct in all respects material to its analysis and opinion, (ii) each party to the merger agreement and such other related documents and instruments would fully and timely perform all of the covenants and agreements required to be performed by such party in all respects material to its analysis and opinion, and (iii) the merger would be consummated in a timely manner in accordance with the terms set forth in the merger agreement, without any modification, amendment, waiver or delay that would be material to its analysis or opinion. In addition, Perella Weinberg assumed that in connection with the receipt of all approvals and consents required in connection with the merger, no delays, limitations, conditions or restrictions would be imposed that would be material to its analysis.

Perella Weinberg’s opinion addresses only the fairness, from a financial point of view, to Orthofix, as of October 10, 2022, of the Exchange Ratio in the merger pursuant to the merger agreement. Perella Weinberg was not asked to, nor did it, offer any opinion as to any other term of the merger agreement or any other document contemplated by or entered into in connection with the merger agreement, the form or structure of the merger or the likely timeframe in which the merger will be consummated. In addition, Perella Weinberg expressed no opinion as to the fairness of the amount or nature of any compensation to be received by any officers, directors or employees of any party to the merger agreement, or any class of such persons, whether relative to the Exchange Ratio or otherwise. Perella Weinberg expressed no opinion as to the fairness of the merger to the holders of any class of securities, creditors or other constituencies of Orthofix, as to the underlying decision by Orthofix to engage in the merger or as to the relative merits of the merger compared with any alternative transactions or business strategies. Nor did Perella Weinberg express any opinion as to any tax or other consequences that might result from the transactions contemplated by the merger agreement or any other related document, although it assumed with Orthofix’s consent, for purposes of its analysis, that the merger would receive the tax treatment contemplated by the merger agreement. Perella Weinberg’s opinion did not address any legal, tax, regulatory or accounting matters, as to which Perella Weinberg understood Orthofix received such advice as it deemed necessary from qualified professionals. Perella Weinberg was not requested to, and it did not, solicit third party indications of interest in the possible acquisition of all or part of Orthofix.

Perella Weinberg’s opinion was necessarily based on financial, economic, market, monetary and other conditions as in effect on, and the information made available to Perella Weinberg as of, the date of its opinion. It should be understood that subsequent developments may affect Perella Weinberg’s opinion and the assumptions used in preparing it, and Perella Weinberg does not have any obligation to update, revise, or reaffirm its opinion. The issuance of Perella Weinberg’s opinion was approved by a fairness committee of Perella Weinberg.

 

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Summary of Material Financial Analyses

The following is a summary of the material financial analyses performed by Perella Weinberg and reviewed by the Orthofix Board in connection with Perella Weinberg’s opinion and does not purport to be a complete description of the financial analyses performed by Perella Weinberg. The order of analyses described below does not represent the relative importance or weight given to those analyses by Perella Weinberg. Some of the summaries of the financial analyses include information presented in tabular format. In order to fully understand Perella Weinberg’s financial analyses, these tables must be read together with the text of each summary. These tables alone do not constitute a complete description of the financial analyses. Considering the data below without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of Perella Weinberg’s financial analyses. Future results may differ from those described and such differences may be material.

Selected Publicly-Traded Companies Analysis

Perella Weinberg performed a selected publicly-traded companies analysis, which is a method of deriving an implied value range for a company’s equity securities based on a review of publicly-traded companies selected by Perella Weinberg as being generally deemed relevant for comparative purposes. Perella Weinberg reviewed and compared certain financial information for Orthofix and SeaSpine to corresponding financial information, financial market multiples and ratios of the following publicly-traded companies:

Large Orthopedic Peers:

 

   

Globus Medical Inc.

 

   

CONMED Corporation

 

   

NuVasive, Inc.

 

   

Integra LifeSciences Holdings Corporation

 

   

Smith & Nephew plc

 

   

Zimmer Biomet Holdings Inc.

Orthofix and SeaSpine Peers:

 

   

Anika Therapeutics, Inc.

 

   

Bioventus Inc.

 

   

ZimVie Inc.

SeaSpine Only Peers:

 

   

Alphatec Spine, Inc.

 

   

Si-Bone, Inc.

Although none of the above companies is identical to Orthofix or SeaSpine, Perella Weinberg selected these companies because they had publicly-traded equity securities and were deemed by Perella Weinberg to be similar to Orthofix and SeaSpine in one or more respects, including operating in the orthopedics and medical technology industries. In selecting these companies, Perella Weinberg considered various factors, including the similarity of the lines of business to Orthofix’s and SeaSpine’s lines of business, as well as the business models, technology, service offerings and end-market exposure of such companies.

For each of Orthofix, SeaSpine and the selected publicly-traded companies, Perella Weinberg reviewed such company’s enterprise value (referred to as “EV”) as of October 7, 2022, as a multiple of estimated revenue for (i) the calendar year ending 2022 (“2022E Revenue”) and (ii) for the calendar year ending 2023 (“2023E Revenue”). For each

 

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of Orthofix and the selected publicly-traded companies, Perella Weinberg reviewed such company’s EV as of October 7, 2022, as a multiple of estimated earnings before interest, taxes, depreciation, and amortization (referred to as “EBITDA”) for (i) the calendar year ending 2022 (“2022E EBITDA”) and (ii) for the calendar year ending 2023 (“2023E EBITDA”). For each of the selected companies, Perella Weinberg calculated and compared financial information and financial market multiples and ratios based on company filings for historical information and consensus third party research estimates for forecasted information.

Set forth below are the high, low and median multiples resulting from this analysis:

 

     EV /
2022E
Revenue
     EV /
2023E
Revenue
     EV /
2022E

EBITDA1
     EV /
2023E
EBITDA1
 

Large Orthopedic Peers:

           

High

     5.1x        4.6x        16.9x        14.8x  

Low

     2.4x        2.3x        9.2x        8.6x  

Median

     3.1x        2.9x        11.6x        10.9x  

Orthofix Peers:

           

High

     2.3x        2.1x        25.1x        29.9x  

Low

     0.7x        0.7x        5.7x        4.8x  

Median

     1.9x        1.7x        13.3x        10.2x  

SeaSpine Peers:

           

High

     4.7x        3.9x        —          —    

Low

     0.7x        0.7x        —          —    

Median

     2.3x        2.1x        —          —    

 

1.

SeaSpine valued on EV / Revenue multiples only.

Based on the analysis of the relevant metrics described above and on professional judgments made by Perella Weinberg, Perella Weinberg selected and applied a range of multiples of (i) 0.75x to 1.75x to EV / 2022E Revenue of Orthofix using the Orthofix Forecasts, (ii) 0.75x to 1.75x to EV / 2023E Revenue of Orthofix using the Orthofix Forecasts, (iii) 1.75x to 2.75x to EV / 2022E Revenue of SeaSpine using the SeaSpine Forecasts, (iv) 1.50x to 2.50x EV/ 2023E Revenue for SeaSpine using the SeaSpine Forecasts, (v) 6.50x to 10.00x to EV / 2022E EBITDA of Orthofix using the Orthofix Forecasts and (vi) 5.00x to 9.00x to EV / 2023E EBITDA of Orthofix using the Orthofix Forecasts. From these analyses, for each of Orthofix and SeaSpine, Perella Weinberg derived ranges of implied equity values from the enterprise values by adding cash and other investments and subtracting debt. Perella Weinberg calculated implied values per share by dividing the implied equity values by the applicable diluted shares (based upon the number of issued and outstanding shares and other equity interests in each case provided by the managements of SeaSpine and Orthofix, as applicable, and using the treasury method for calculation of option dilution). The ranges of implied values per share derived from these calculations are summarized in the following table:

 

    

Orthofix Share

Price (based on

Orthofix
Forecasts)

  

SeaSpine Share Price

(based on SeaSpine

Forecasts)

    

Range

  

Range

Implied Value Range Per Share (using EV / 2022E Revenue)

   $19—$41    $11—$17

Implied Value Range Per Share (using EV / 2023E Revenue)

   $20—$44    $11—$18

Implied Value Range Per Share (using EV / 2022E EBITDA)1

   $20—$30    $11—$17

Implied Value Range Per Share (using EV / 2023E EBITDA)1

   $19—$31    $11—$18

 

1

SeaSpine valued on EV / Revenue multiples only.

 

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Perella Weinberg then calculated the exchange ratio ranges implied by the selected publicly-traded companies analysis. For each of the foregoing analyses, Perella Weinberg calculated (i) the ratio of the highest implied value per share for SeaSpine derived from the selected publicly-traded companies analysis to the lowest implied value per share for Orthofix derived from the selected publicly-traded companies analysis and (ii) the ratio of the lowest implied value per share for SeaSpine derived from the selected publicly-traded companies analysis to the highest implied value per share for Orthofix derived from the selected publicly-traded companies analysis to calculate the following implied exchange ratio ranges:

 

Metric    Implied Exchange
Ratio Range

EV / 2022E Revenue

   0.280x—0.901x

EV / 2023E Revenue

   0.258x—0.876x

EV / 2022E EBITDA1

   0.381x—0.839x

EV / 2023E EBITDA1

   0.361x—0.963x

 

1

SeaSpine valued on EV / Revenue multiples only.

These exchange ratio ranges can be compared to the exchange ratio of 0.4163 shares of Orthofix common stock to be received for each share of SeaSpine common stock as provided for in the merger agreement.

Although the selected publicly-traded companies were used for comparison purposes, no business of any selected company was either identical or directly comparable to Orthofix’s or SeaSpine’s business. Perella Weinberg’s comparison of selected publicly-traded companies to Orthofix and SeaSpine and analysis of the results of such comparisons were not purely mathematical, but instead necessarily involved complex considerations and judgments concerning differences in financial and operating characteristics and other factors that could affect the relative values of the selected publicly-traded companies in such transactions and of the merger and was based on Perella Weinberg’s experience working with corporations on various merger and acquisition transactions.

Discounted Cash Flow Analysis

For each of Orthofix and SeaSpine, Perella Weinberg performed a discounted cash flow analysis, which is a method of deriving an implied value range for a company’s equity securities based on the sum of the company’s unlevered free cash flows over a forecast period and the terminal value at the end of the forecast period. In connection with this analysis, Perella Weinberg used the Orthofix Forecasts for Orthofix and the SeaSpine Forecasts for SeaSpine. In performing this analysis, Perella Weinberg:

 

   

calculated the present value as of October 7, 2022, of the estimated standalone unlevered free cash flows (calculated as net operating profit after tax, plus depreciation and amortization, minus capital expenditures, and adjusting for changes in net working capital and certain other cash flow items set forth in the Orthofix Forecasts and the SeaSpine Forecasts) that each of Orthofix and SeaSpine was forecasted to generate for 2H’ 2022E through 2031E using discount rates ranging from 9.75% to 10.75% for Orthofix and 10.50% to 11.50% for SeaSpine, in each case based on estimates of the weighted average cost of capital of each company; and

 

   

adding terminal values of each of Orthofix and SeaSpine using perpetuity growth rates ranging from 2.0% to 3.0% for Orthofix and 3.0% to 5.0% for SeaSpine and the same discount rates for each of Orthofix and SeaSpine as set forth above.

From the ranges of implied enterprise values generated by the foregoing analysis, for each of Orthofix and SeaSpine, Perella Weinberg derived ranges of implied equity values by adding cash and other investments and subtracting debt and net non-operating liabilities. Perella Weinberg calculated implied values per share by dividing the implied equity values by the applicable diluted shares (based upon the number of issued and

 

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outstanding shares and other equity interests in each case provided by the managements of SeaSpine and Orthofix, as applicable, and using the treasury method for calculation of option dilution). The ranges of implied values per share derived from these calculations are summarized in the following table:

 

    

Orthofix Share

Price (based on

Orthofix
Forecasts)

    

SeaSpine Share
Price (based on
SeaSpine

Forecasts)

 
     Range      Range  

Implied Value Range Per Share

   $ 24—$30      $ 6—$11  

Perella Weinberg then calculated the exchange ratio ranges implied by the discounted cash flow analysis. For each of the foregoing analyses, Perella Weinberg calculated (i) the ratio of the highest implied value per share for SeaSpine derived from the discounted cash flow analysis to the lowest implied value per share for Orthofix derived from the discounted cash flow analysis and (ii) the ratio of the lowest implied value per share for SeaSpine derived from the discounted cash flow analysis to the highest implied value per share for Orthofix derived from the discounted cash flow to calculate the following implied exchange ratio ranges:

 

     Implied Exchange
Ratio Range

Orthofix Forecasts / SeaSpine Forecasts

   0.213x—0.453x

These exchange ratio ranges can be compared to the exchange ratio of 0.4163 shares of Orthofix common stock to be received for each share of SeaSpine common stock as provided for in the merger agreement.

Perella Weinberg also performed an additional discounted cash flow analysis of the present value of the Synergies expected to result from the merger. The Synergy estimates were discounted to present value using a range of discount rates from 9.75% to 10.75% and a perpetuity growth rate of 3.0%. Perella Weinberg then calculated a range of implied present values per share of the combined company post-Merger taking into account: (i) Orthofix’s standalone discounted cash flow value as set forth above, plus (ii) either (A) SeaSpine’s standalone discounted cash flow value as set forth above or (B) SeaSpine’s standalone discounted cash flow value, utilizing the Orthofix discount rates of 9.75% to 10.75% rather than the SeaSpine discount rates of 10.50% to 11.50%, (iii) the present value of the Synergies expected to result from the merger, minus (iv) the Orthofix and SeaSpine managements’ estimates of the transaction-related expenses. These analyses resulted in the following reference ranges of implied equity values per share:

 

   

Pro Forma Share
Price (including
Synergies)

   

Range

Implied Value Range Per Share (SeaSpine discount rate)

  $30 – $39

Implied Value Range Per Share (Orthofix discount rate)

  $31 – $42

 

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Additional Financial Analyses

Historical Share Price Analysis

For the information of the Orthofix Board and for reference purposes only, Perella Weinberg reviewed the share price performance of Orthofix and SeaSpine during various periods, including the 52-week and the 6-month periods, each ending on October 7, 2022. Perella Weinberg noted that the ranges of intraday low and high trading prices of Orthofix common stock and SeaSpine common stock during each respective period were as follows:

 

     Orthofix
Common

Stock Share
Price
     SeaSpine
Common

Stock Share
Price
 
Trading Period    Low      High      Low      High  

Last 52 Weeks

   $ 18      $ 39      $ 5      $ 17  

Last 6 Months

   $ 18      $ 35      $ 5      $ 11  

Based on the minimum and maximum share prices of Orthofix and SeaSpine, in each case, during the 52-week and the 6-month periods, each ending on October 7, 2022, Perella Weinberg derived ranges of implied exchange ratios of shares of Orthofix common stock to shares of SeaSpine common stock of 0.141x to 0.915x and 0.155x to 0.622x, respectively. These exchange ratio ranges can be compared to the exchange ratio of 0.4163 shares of Orthofix common stock to be received for each share of SeaSpine common stock as provided for in the merger agreement.

Research Analyst Price Targets

For the information of the Orthofix Board and for reference purposes only, Perella Weinberg observed the most recent publicly available price targets for Orthofix and SeaSpine common stock published by (i) all Wall Street research analysts and (ii) Wall Street research analysts who covered both of Orthofix and SeaSpine. The selected price targets reflect each research analyst’s estimate of the future public market trading prices of shares of Orthofix common stock and SeaSpine common stock. Perella Weinberg noted that the analysts’ price targets for (i) all Wall Street research analysts ranged from $28 to $48 per share for Orthofix common stock and from $12 to $26 per share for SeaSpine common stock and (ii) Wall Street research analysts who covered both of Orthofix and SeaSpine ranged from $28 to $45 per share for Orthofix common stock and $16 to $26 per share for SeaSpine common stock.

Based on comparisons of the high and low research analyst price targets for Orthofix and SeaSpine, Perella Weinberg derived a range of implied exchange ratios of shares of Orthofix common stock to shares of SeaSpine common stock of 0.250x to 0.938x, when including all research analysts, and 0.356x to 0.938x, when only including research analysts that covered both of Orthofix and SeaSpine. These exchange ratio ranges can be compared to the exchange ratio of 0.4163 shares of Orthofix common stock to be received for each share of SeaSpine common stock as provided for in the merger agreement.

Miscellaneous

The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. Selecting portions of the analyses or of the summary set forth herein, without considering the analyses or the summary as a whole could create an incomplete view of the processes underlying Perella Weinberg’s opinion. In arriving at its fairness determination, Perella Weinberg considered the results of all of its analyses and did not attribute any particular weight to any factor or analysis considered. Rather, Perella Weinberg made its determination as to fairness on the basis of its experience and professional judgment after considering the results of all of its analyses. No company used in the analyses described herein as a comparison is directly comparable to Orthofix, SeaSpine or the merger.

 

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Perella Weinberg prepared the analyses described herein for purposes of providing its opinion to the Orthofix Board as to the fairness, from a financial point of view, to Orthofix, as of the date of such opinion, of the Exchange Ratio in the merger pursuant to the merger agreement. These analyses do not purport to be appraisals or necessarily reflect the prices at which businesses or securities actually may be sold. Perella Weinberg’s analyses were based in part upon third party research analyst estimates, which are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by Perella Weinberg’s analyses. Because these analyses are inherently subject to uncertainty, being based upon numerous factors or events beyond the control of the parties to the merger agreement or their respective advisors, none of Orthofix, SeaSpine, Perella Weinberg or any other person assumes responsibility if future results are materially different from those forecasted by third parties.

As described above, the opinion of Perella Weinberg to the Orthofix Board was one of many factors taken into consideration by the Orthofix Board in making its determination to approve the merger. The type and amount of consideration payable in the merger, including the Exchange Ratio, was determined through negotiations between Orthofix and SeaSpine, rather than by any financial advisor, and was approved by the Orthofix Board. The decision to enter into the merger agreement was solely that of the Orthofix Board.

Perella Weinberg acted as financial advisor to the Orthofix Board in connection with, and participated in certain negotiations leading to, the merger. For its services in connection with the merger, Perella Weinberg will receive an aggregate fee, estimated based on the information that is available as of the date of the public announcement of the merger, of approximately $5,600,000, $2,500,000 of which was payable in connection with the delivery of Perella Weinberg’s opinion and the remainder of which is contingent upon consummation of the merger. Orthofix agreed to reimburse Perella Weinberg for its reasonable and documented out-of-pocket expenses, to pay to Perella Weinberg a portion of any break-up fee received in connection with a termination of the merger, and to indemnify Perella Weinberg and related persons for certain liabilities and other items that may arise out of its engagement by Orthofix and the rendering of its opinion.

Perella Weinberg has provided investment banking services to Orthofix or its affiliates on matters unrelated to the merger including during the two-year period prior to the date hereof; however, during the two-year period prior to the date hereof, Perella Weinberg has not received compensation for such services. During the two-year period prior to the date hereof, no material investment banking relationship existed between Perella Weinberg or its affiliates, on the one hand, and SeaSpine or any of its affiliates, on the other hand, pursuant to which Perella Weinberg or its affiliates has received or anticipates receiving compensation. However, Perella Weinberg and its affiliates in the future may provide investment banking and other financial services to SeaSpine and/or Orthofix and their respective affiliates and in the future may receive compensation for the rendering of these services. In the ordinary course of its business activities, Perella Weinberg and its affiliates may at any time hold long or short positions, and may trade or otherwise effect transactions, for its own account or the accounts of customers or clients, in (i) debt, equity or other securities (or related derivative securities) or financial instruments (including bank loans or other obligations) of Orthofix, SeaSpine or any of their respective affiliates and (ii) any currency or commodity that may be material to the parties or otherwise involved in the merger.

Opinion of SeaSpine’s Financial Advisor

On October 10, 2022, Piper Sandler rendered its oral opinion to the SeaSpine Board (which was subsequently confirmed in writing by delivery of Piper Sandler’s written opinion, dated the same date) to the effect that, as of October 10, 2022, and based upon and subject to the various assumptions and limitations set forth therein, the exchange ratio was fair, from a financial point of view, to the holders of SeaSpine common stock.

The full text of the Piper Sandler written opinion dated October 10, 2022, which sets forth, among other things, the assumptions made, procedures followed, matters considered and limitations on the scope of the review undertaken by Piper Sandler in rendering its opinion, is attached as Annex C to this joint

 

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proxy statement/prospectus. The Piper Sandler opinion addresses solely the fairness, from a financial point of view, to holders of SeaSpine common stock of the exchange ratio. Piper Sandler’s opinion was provided to the SeaSpine Board in connection with its consideration of the merger and was not intended to be and does not constitute a recommendation to any SeaSpine stockholder as to how such stockholder should act or vote with respect to the merger or any other matter. Piper Sandler’s opinion was approved for issuance by the Piper Sandler opinion committee.

In connection with rendering the opinion described above and performing its related financial analyses, Piper Sandler, among other things:

 

   

reviewed and analyzed the financial terms of a draft of the merger agreement labeled “Execution Version”;

 

   

reviewed and analyzed certain financial and other data with respect to SeaSpine and Orthofix which was publicly available;

 

   

reviewed and analyzed certain information, including financial forecasts, relating to the business, earnings, cash flow, assets, liabilities and prospects of SeaSpine (including current net operating losses (“NOLs”) available to SeaSpine), as described in the section entitled “Certain Unaudited Prospective Financial Information — Certain SeaSpine Unaudited Prospective Financial Information,” and Orthofix, as described in the section entitled “Certain Unaudited Prospective Financial Information — Certain Orthofix Unaudited Prospective Financial Information,” that were publicly available, as well as those that were furnished to Piper Sandler by SeaSpine and Orthofix, respectively, which included financial forecasts related to the combined company, including the analyses and forecasts of certain cost savings, operating efficiencies, strategic benefits and other synergies expected by managements of SeaSpine and Orthofix to result from the merger, including the ability of the combined company to use such NOLs and the costs expected to realize such synergies (collectively, the “Synergies”);

 

   

conducted discussions with members of senior management and representatives of SeaSpine and Orthofix concerning the two immediately preceding matters described above, as well as their respective businesses and prospects before and after giving effect to the merger and the Synergies, including discussions with members of senior management of SeaSpine regarding the ability of SeaSpine to finance its current business plan and the options available to SeaSpine regarding such financing;

 

   

reviewed the current and historical reported prices and trading activity of SeaSpine common stock and Orthofix common stock; and

 

   

compared the financial performance of SeaSpine and Orthofix with that of certain other publicly-traded companies that Piper Sandler deemed relevant.

In addition, Piper Sandler conducted such other analyses, examinations and inquiries and considered such other financial, economic and market criteria as Piper Sandler deemed necessary in arriving at its opinion.

The following is a summary of the material financial analyses performed by Piper Sandler in connection with the preparation of its fairness opinion and reviewed with the SeaSpine Board at a meeting held on October 10, 2022.

This summary includes information presented in tabular format, which tables must be read together with the text of each analysis summary and considered as a whole in order to fully understand the financial analyses presented by Piper Sandler. The tables alone do not constitute a complete summary of the financial analyses. The order in which these analyses are presented below, and the results of those analyses, should not be taken as any indication of the relative importance or weight given to these analyses by Piper Sandler or the SeaSpine Board. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before October 7, 2022, and is not necessarily indicative of current market conditions.

Unless the context indicates otherwise, for purposes of the financial analyses described below, Piper Sandler calculated enterprise value (“EV”) for SeaSpine, Orthofix and each selected public company (defined as the

 

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relevant company’s common equity value, plus book value of preferred stock, plus fair value of contingent consideration, plus debt, plus capital leases, less cash and cash equivalents, less investments in partnerships, and less short and long term marketable securities (“net debt”), plus, where applicable, book value of non-controlling interests), based on (a) the market value of the relevant company’s diluted common equity, using closing stock prices on October 7, 2022, (b) the relevant company’s net debt as of such company’s most recently reported quarter end, which in each case was as of June 30, 2022, and in the case of Orthofix, adjusted for financial leases, and (c) in the case of SeaSpine and Orthofix, implied per share values for each using diluted shares, calculated using the treasury stock method, of SeaSpine common stock and Orthofix common stock, respectively as of October 7, 2022 (the “SeaSpine Closing Price” and the “Orthofix Closing Price,” respectively). Additionally, “gross profit” in the case of SeaSpine was adjusted to exclude technology amortization, non-cash stock based compensation expense and purchase accounting fair market value charges. Further, historical and projected financial data used in the analyses below were not adjusted to reflect any potential accounting adjustments to conform SeaSpine and Orthofix accounting policies.

For purposes of certain analyses below, the term “Implied Per-Share Merger Consideration” refers to the implied per share value of the merger consideration of $7.64, based on the exchange ratio of 0.4163 shares of Orthofix common stock per share of SeaSpine common stock and the Orthofix Closing Price.

Selected Public Companies Analysis

Selected Public Companies Analysis - SeaSpine Standalone

Piper Sandler reviewed, among other things, historical financial information for SeaSpine for the last twelve-months for which financial information was publicly available (“LTM”), which was as of June 30, 2022, as well as projected financial data for SeaSpine prepared by SeaSpine’s management for the years ending December 31, 2022 (“2022E”) and December 31, 2023 (“2023E”), see the section entitled “— Certain Unaudited Prospective Financial Information,” and compared such data to corresponding historical financial information and Wall Street consensus research estimates (“Consensus Estimates”) for selected public companies. Such selected public companies included those that Piper Sandler considered to be (i) orthopedic medical technology companies based in the U.S. with (a) LTM revenue less than $2 billion and (b) projected revenue growth in 2022 and 2023 less than 30% (the “Select Orthopedic Companies”), (ii) spine implant companies based in the U.S. (the “Spine Implant Companies”), and (iii) medical technology companies with (a) LTM revenue less than $750 million, (b) projected revenue growth in 2022 and 2023 between 10% and 25% and (c) LTM EBITDA (which is defined as earnings before interest, tax, depreciation and amortization) margin less than 0% (the “Growth Med Tech with Losses Companies”).

Piper Sandler selected the following Select Orthopedic Companies:

 

   

Anika Therapeutics, Inc.

 

   

Bioventus Inc.(1)

 

   

ConforMIS, Inc.

 

   

CONMED Corporation(2)

 

   

Enovis Corporation

 

   

Globus Medical, Inc.

 

   

NuVasive, Inc.

 

   

Paragon 28, Inc.

 

   

SI-Bone, Inc.

 

   

Surgalign Holdings, Inc.

 

   

Xtant Medical Holdings, Inc.(3)

 

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ZimVie Inc.

Piper Sandler selected the following Spine Implant Companies:

 

   

Alphatec Holding, Inc.

 

   

Globus Medical, Inc.

 

   

NuVasive, Inc.

 

   

SI-Bone, Inc.

 

   

Surgalign Holdings, Inc.

 

   

Xtant Medical Holdings, Inc.

Piper Sandler selected the following Growth Med Tech with Losses Companies:

 

   

Apollo Endosurgery, Inc.

 

   

Apyx Medical Corporation

 

   

AtriCure, Inc.

 

   

Cerus Corporation

 

   

KORU Medical Systems, Inc.

 

   

Neuronetics, Inc.

 

   

Paragon 28, Inc.

 

   

SI-Bone, Inc.

 

   

Sientra, Inc.

 

(1)

Analyses use of EV reflects pro forma acquisition of CartiHeal Ltd.

(2)

Analyses use of EV reflects pro forma acquisition of Biorez, Inc.

(3)

Consensus Estimates for Xtant Medical Holdings do not exist because of lack of research coverage; 2022E and 2023E gross profit was calculated using the company’s year-to-date (“YTD”) gross margin; analyses performed pro forma for the private placement that closed in August 2022.

For these selected public companies analyses, Piper Sandler compared, among other things, the implied EV/revenue and EV/gross profit multiples for each of LTM, 2022E and 2023E for SeaSpine, based on each of the SeaSpine Closing Price and the Implied Per-Share Merger Consideration, to the corresponding multiple for the selected public companies. The projected 2022E and 2023E revenue and gross profit financial information for (i) SeaSpine was based on estimates provided to Piper Sandler by SeaSpine’s management and (ii) the selected public companies was based on Consensus Estimates publicly available as of October 7, 2022.

The analyses indicated the following implied multiples:

Select Orthopedic Companies:

 

     EV / Revenue      EV / Gross Profit  
     LTM      2022E      2023E      LTM      2022E      2023E  

Maximum

     8.1x        7.4x        6.2x        9.8x        9.1x        7.7x  

75th Percentile

     4.4x        4.0x        3.4x        6.1x        5.7x        4.9x  

Mean

     3.0x        2.8x        2.5x        4.2x        3.9x        3.5x  

Median

     2.4x        2.2x        2.0x        3.4x        3.0x        2.7x  

25th Percentile

     1.4x        1.4x        1.3x        2.6x        2.5x        2.3x  

Minimum

     0.5x        0.5x        0.4x        0.8x        0.7x        0.6x  

 

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Spine Implant Companies: