SCHEDULE 13D/A: Deerfield Management Amends Acutus Medical Stake Following Warrant Cancellation and SEC Deregistration

Deerfield Management has updated its Schedule 13D filing for Acutus Medical, Inc., reflecting the cancellation of warrants held by its funds after the company completed its SEC deregistration and paid a termination fee.

Summary

• Deerfield Management and its affiliated funds (Deerfield Mgmt III, Deerfield Private Design Fund III, Deerfield Mgmt, Deerfield Partners) along with James E. Flynn, have filed Amendment No. 9 to their Schedule 13D regarding Acutus Medical, Inc.
• The amendment reports the satisfaction of conditions for a previous Amendment No. 5, leading to the cancellation of all warrants beneficially owned by the Deerfield Funds.
• These conditions included Acutus Medical, Inc. filing a Form 15 with the SEC on January 24, 2025, to terminate the registration of its securities under Section 12(g) of the Exchange Act.
• Acutus Medical, Inc. also paid a warrant termination fee of $250,000 in U.S. dollars on January 27, 2025.
• As of the filing, Deerfield Management Company, L.P. and James E. Flynn collectively beneficially own 5,492,725 shares of Acutus Medical common stock, representing 9.1% of the class.
• This ownership includes 2,648,386 shares of common stock and 2,764,841 shares issuable upon conversion of Series A Common Stock Equivalent Convertible Preferred Stock, plus 58,676 shares underlying vested stock options and 20,822 shares issued upon vesting of restricted share units held by Andrew ElBardissi for the benefit and at the direction of Deerfield Management.
• The beneficial ownership percentages are calculated based on 29,912,305 shares of Common Stock outstanding as of November 8, 2024, as reported by Acutus Medical in its Q3 2024 Form 10-Q.

Sentiment

Score: 5

Explanation: The document is neutral, primarily reporting factual updates on beneficial ownership and the completion of previously disclosed corporate actions (SEC deregistration and warrant cancellation). It does not contain information that would significantly alter the perceived value or risk of the company in a positive or negative direction beyond what was already implied by the prior Amendment No. 5.

Positives

• The completion of the warrant cancellation simplifies the capital structure for Acutus Medical.
• The termination of SEC registration under Section 12(g) may reduce regulatory compliance costs for Acutus Medical.

Negatives

• The termination of SEC registration under Section 12(g) means the company's securities will no longer be subject to the full reporting requirements of the Exchange Act, potentially reducing transparency for public investors.
• The payment of a $250,000 warrant termination fee represents a cash outflow for Acutus Medical.

Risks

• The terms of the Series A Common Stock Equivalent Convertible Preferred Stock restrict conversion if beneficial ownership by the holder and affiliates would exceed 4.9% of the total outstanding common stock (the "Ownership Cap"), which limits the immediate convertibility of a significant portion of the Deerfield Funds' holdings.
• Termination of SEC registration under Section 12(g) could lead to reduced liquidity and investor interest due to less public information and potentially delisting from major exchanges.

Future Outlook

The document primarily reports past events (filing of Form 15, payment of fee, warrant cancellation) and current ownership. It does not provide explicit forward-looking statements or guidance from the company or the reporting persons regarding future operations or financial performance.

Industry Context

This filing reflects a specific corporate action (deregistration and warrant cancellation) by Acutus Medical, Inc., and an update to a major investor's holdings. It does not provide broader industry trends or competitive analysis. The deregistration suggests a move away from public market scrutiny, which can be a trend for smaller companies facing high compliance costs.

Corporate Governance

Stakeholder Impact

• Shareholders: The deregistration under Section 12(g) may lead to reduced liquidity and transparency for shareholders, as the company will no longer be subject to the same level of public reporting requirements. The cancellation of warrants simplifies the capital structure.
• Regulatory Authorities: The filing of Form 15 signifies a change in the company's regulatory reporting status with the SEC.

Next Steps

• Acutus Medical's securities will no longer be registered under Section 12(g) of the Exchange Act, which will impact its reporting obligations.

Key Dates

Recommendation

Keywords

Acutus Medical, Deerfield Management, Schedule 13D, SEC filing, beneficial ownership, warrant cancellation, Form 15, Section 12(g), deregistration, common stock, convertible preferred stock, investment fund, corporate governance