Alphatec Holdings (ATEC) Announces Preliminary Q1 Revenue Results and Provides Corporate Updates

Alphatec Holdings, Inc. (Nasdaq: ATEC), a provider of innovative solutions dedicated to revolutionizing the approach to spine surgery, announced today preliminary revenue results for the first quarter ended March 31, 2021. The Company confirmed that the Autorité des marchés financiers (AMF), France’s financial markets regulator, cleared ATEC’s public tender offer for EOS imaging S.A. (EOS), allowing the Company to commence purchase of EOS’ outstanding share capital and voting rights. The Company also announced the appointment of J. Todd Koning to the role of Chief Financial Officer. Mr. Koning succeeds Jeffrey Black, who has resigned as CFO, effective April 18, 2021, to pursue interests outside of spine, but will remain with the Company in a transition capacity through April 30, 2021.

Preliminary First Quarter 2021 Revenue

“Surgeon enthusiasm for the clinical sophistication we are demonstrating and our revitalized ATEC sales force continues to fuel strong revenue growth,” said Pat Miles, Chairman and Chief Executive Officer. “We are creating tremendous momentum with market-shaping procedures like PTP, and are enjoying expanded adoption across our increasingly comprehensive and distinctive portfolio. At ATEC, we know our business is in the operating room and our success is directly correlated to our ability to improve spine surgery. Focused execution against that commitment drove strong first quarter results and gives us confidence that 2021 U.S. revenue growth will exceed 30%. This marks a solid start to another exciting year as we continue to raise the standard in spine.”

The preliminary financial results announced today are based on the Company’s current expectations and may be adjusted as a result of, among other things, completion of customary quarter-end close review procedures and further financial review. The Company expects to announce first quarter financial and operating results on May 6, 2021, after the market close.

Clearance and Commencement of EOS imaging Tender Offer

On March 30, 2021, the AMF cleared the Company’s tender offer for EOS. As a result, on April 1, 2021, ATEC commenced its public offer to purchase for cash all EOS issued and outstanding ordinary shares and all outstanding convertible bonds for a total purchase price of approximately $117 million. As previously disclosed by the Company, the offer will remain open for an initial acceptance period of 25 Euronext Paris trading days and, subject to the satisfaction or waiver of certain tender conditions, the initial tender may be followed by a reopened tender offer for a period of 10 additional Euronext Paris trading days. If ATEC owns 90% or more of EOS’ share capital and voting rights following the close of either offer period, the Company will squeeze-out any remaining, non-tendered EOS shares, according to French law and regulation.

Leadership Transition

Mr. Koning, who will join the Company on April 19, 2021, brings over 20 years of focused medical device finance, accounting and international experience. His ATEC appointment follows three years with Masimo Corporation, where he most recently served as Senior Vice President of Finance and Chief Accounting Officer, responsible for corporate planning and analysis, global accounting, SEC reporting, financial systems, and investor outreach. Prior to his role at Masimo, Mr. Koning served for two years as Vice President of Finance at NuVasive, where he spent the majority of his tenure abroad as the Vice President of International Finance, then partnered with the head of Global Commercial to lead the ~$1B global commercial organization. Previously, Mr. Koning was Vice President of Finance at Ellipse Technologies, which was acquired by NuVasive in 2016. He also held various domestic and international finance and accounting leadership roles at Boston Scientific and Guidant.

“I am thrilled to welcome Todd to the ATEC Family,” said Miles. "He brings a wealth of med device experience, operational expertise, and international finance know-how that will be invaluable as ATEC evolves from a turnaround story into a global spine market share taker. Many of us worked with Todd in the past and we are eager to again leverage his prowess. We are grateful for Jeff’s contributions during his four years with the Company. He was instrumental in transforming the Company’s balance sheet and institutionalizing the shareholder base, enabling ATEC's ascent from a microcap stock to a billion-dollar enterprise. Given the strong foundation Jeff has established, we anticipate a seamless transition, and wish him the very best in his future pursuits.”

Quentin Blackford, Chairman of ATEC's Finance Committee, added, “I had the pleasure of working closely with Todd during our shared tenure at NuVasive. His track record of successfully building global organizations in rapid-growth environments will add considerable value to ATEC’s finance and accounting expertise as its business continues to expand. He is a trusted, accomplished leader who shares ATEC’s values of GRIT, integrity and accountability. He will be a great fit within the Company’s high-performance culture and I am excited about his prospective influence.”

Inducement Award

As an inducement to entering into employment with the Company and in accordance with NASDAQ Listing Rule 5635(c)(4), effective as of April 19, 2021, the Compensation Committee of the Board of Directors has approved an inducement award to Mr. Koning of restricted stock units (RSUs) under the Company’s 2016 Employment Inducement Award Plan as follows: 150,000 RSUs of the Company’s common stock to vest in four equal annual installments on each of the first four anniversaries of date of employment; 40,000 RSUs of the Company’s common stock to vest in three equal annual installments on each of the first three anniversaries of February 18, 2021; and 10,000 Performance RSUs of the Company’s common stock to vest in three equal annual installments on each of the first three anniversaries of February 18, 2021, with such Performance RSUs leveraging from 0% to 500%, based on certain pre-defined metrics set by the Compensation Committee of the Board. Each of the foregoing inducement awards are conditioned upon Mr. Koning remaining continuously employed by the Company as of each such vesting date. In addition, the RSUs will vest fully upon a change of control.

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