8-K: Strive Details Semler Scientific Merger Pro Forma Financials

Strive, Inc. filed pro forma financial information related to its pending all-stock acquisition of Semler Scientific, Inc., with Strive designated as the accounting acquirer.

Summary

• Strive, Inc. (ASST) is proceeding with an all-stock acquisition of Semler Scientific, Inc. (SMLR), based on an Agreement and Plan of Merger dated September 22, 2025, which was unanimously approved by both companies' boards on September 21, 2025.
• Strive has been determined to be the accounting acquirer for the transaction, meaning Strive's historical financial statements will become those of the combined entity, and Semler Scientific's assets and liabilities will be recognized at fair value.
• At the effective time of the merger, each share of Semler Scientific common stock will be converted into the right to receive 21.05 shares of Strive Class A common stock.
• The preliminary estimated purchase price consideration for Semler Scientific is $471,739,943, calculated based on 318,743,205 shares of Strive Class A common stock to be issued at a price of $1.48 per share.
• Unaudited pro forma combined consolidated financial information is provided, giving effect to the merger as if it occurred on January 1, 2024, for the statements of operations, and on September 30, 2025, for the balance sheet.
• The pro forma combined total assets as of September 30, 2025, are estimated at $1,401,244,000.
• The pro forma combined net loss for the nine months ended September 30, 2025, is $(200,145,000), resulting in a basic loss per common share of $(0.43).
• For the year ended December 31, 2024, the pro forma combined net income is $9,205,000, with a basic earnings per common share of $0.03.
• The transaction includes a preliminary estimate of goodwill amounting to $11,991,000 and an accrual for non-recurring acquisition-related expenses of $10,114,000.

Sentiment

Score: 6

Explanation: The filing provides necessary pro forma financial information for a significant merger, which is a positive step towards completion. However, the pro forma combined entity shows a substantial net loss for the nine months ended September 30, 2025, and the document highlights numerous risks associated with the integration and the volatile nature of digital assets, tempering overall sentiment.

Positives

• The merger agreement was unanimously approved by the boards of directors of both Strive and Semler Scientific.
• The proposed transaction is anticipated to yield strategic and financial benefits for the combined company.
• Strive's existing stockholders are expected to retain the majority voting interest in the combined entity.
• Strive's senior management is expected to control the strategic direction of the combined company post-merger.
• Strive's existing directors are expected to hold a majority of the board seats of the combined company.

Negatives

• The unaudited pro forma combined consolidated statement of operations shows a net loss of $(200,145,000) for the nine months ended September 30, 2025.
• An accrual of $10,114,000 for non-recurring acquisition-related expenses is reflected in the pro forma financials.
• The transaction will result in dilution for Strive's existing shareholders due to the issuance of 318,743,205 additional shares of Class A common stock.

Risks

• The occurrence of any event, change, or circumstances that could lead to the termination of the merger agreement.
• The possibility that the proposed transaction does not close when expected or at all due to conditions to closing not being met or satisfied.
• The outcome of any legal proceedings that may be instituted against Strive, Semler Scientific, or the combined company.
• The anticipated benefits of the proposed transaction, including cost savings and strategic gains, may not be realized when expected or at all.
• Risks associated with the implementation of Bitcoin treasury strategies and the general volatility of Bitcoin and other digital assets.
• General economic and market conditions, interest and exchange rates, monetary policy, and changes in laws and regulations and their enforcement could impact the combined company.
• The integration of the two companies may be more difficult, time-consuming, or costly than expected.
• The proposed transaction may be more expensive or take longer to complete than anticipated due to unexpected factors or events.
• Diversion of management's attention from ongoing business operations and opportunities.
• Potential adverse reactions from Strive's or Semler Scientific's customers or changes to business or employee relationships resulting from the announcement or completion of the proposed transaction.
• Changes in Strive's or Semler Scientific's share price before closing the transaction.
• Other unknown or unpredictable factors could harm the results of Strive, Semler Scientific, or the combined company.

Future Outlook

The filing includes forward-looking statements regarding the anticipated strategic and financial benefits of the proposed transaction, the expected timing of its closing, and the ability to successfully integrate the combined businesses. However, it explicitly cautions that the pro forma information is for illustrative purposes only and does not project future financial position or operating results, and actual outcomes may differ materially due to various risks and uncertainties.

Management Comments

• Strive's senior management is expected to control the strategic direction of Strive following consummation of the Semler Merger.

Industry Context

Strive, a bitcoin treasury asset management firm, is undertaking a significant all-stock acquisition of Semler Scientific. This move suggests a strategic expansion or diversification beyond its core bitcoin investment advisory services, potentially integrating Semler's operations or leveraging its assets. The continued emphasis on 'Bitcoin treasury strategies and risks associated with Bitcoin and other digital assets' in the risk factors indicates that Strive's core identity and exposure to the digital asset market will remain central to the combined entity's strategy and risk profile. The merger could position Strive to broaden its service offerings or asset base within the evolving financial technology and digital asset landscape.

Comparison to Industry Standards

• NA

Stakeholder Impact

• Shareholders of Strive: Will experience dilution due to the issuance of new Class A common stock but are expected to retain the majority voting interest in the combined entity. The merger aims for strategic and financial benefits.
• Shareholders of Semler Scientific: Will receive 21.05 shares of Strive Class A common stock for each share of Semler Scientific common stock they hold, pending their approval of the transaction.
• Customers and Employees of both companies: May experience potential adverse reactions or changes to business or employee relationships resulting from the announcement or completion of the proposed transaction.

Next Steps

• Closing of the proposed transaction, subject to the satisfaction or waiver of customary closing conditions.
• Successful integration of the combined businesses post-merger.
• Semler Scientific stockholders are required to approve the proposed transaction.
• Strive and Semler Scientific may file other relevant documents concerning the proposed transaction with the SEC.
• A definitive Information Statement/Proxy Statement/Prospectus will be sent to the stockholders of Semler Scientific to seek their approval.

Key Dates

Recommendation

The filing details a major all-stock acquisition by Strive, a Bitcoin treasury asset management firm, of Semler Scientific. While the merger has strategic benefits and board approval, the pro forma financials indicate a significant net loss for the combined entity in the most recent nine-month period. The transaction also introduces substantial integration risks, potential dilution for Strive shareholders, and continued exposure to the volatility of digital assets. Given the strategic intent but also the financial headwinds and inherent risks, a cautious 'hold' stance is warranted until the integration progresses and the combined entity's operational performance can be more clearly assessed.

Keywords

Merger, Acquisition, Strive Inc., Semler Scientific Inc., Pro Forma Financials, SEC Filing, 8-K, Bitcoin, Digital Assets, Financial Reporting, Corporate Governance, Nasdaq, ASST, SMLR