Form 4: Paragon 28 Director Blackford Reports Disposal of Shares Following Merger with Zimmer Biomet

Director Quentin S. Blackford reports the disposal of Paragon 28 shares due to the merger with Zimmer Biomet Holdings, Inc., where each share was converted into cash and a contingent value right.

Summary

• Quentin S. Blackford, a director of Paragon 28, Inc., filed a Form 4 detailing changes in beneficial ownership.
• The filing is triggered by the merger between Paragon 28 and Zimmer Biomet Holdings, Inc., which became effective on April 21, 2025.
• As a result of the merger, each share of Paragon 28 common stock was converted into the right to receive $13.00 in cash and one contingent value right (CVR).
• The CVR entitles the holder to a contingent payment of up to $1.00 in cash upon achievement of specified milestones.
• Blackford disposed of 50,554 shares of common stock as a result of the merger.
• Outstanding restricted stock units subject to time-based vesting also vested and were canceled, with holders receiving cash and CVRs for each underlying share.

Sentiment

Score: 7

Explanation: The sentiment is neutral to positive. The merger provides immediate cash value to shareholders with potential for additional upside through the CVR. The completion of the merger removes uncertainty for Paragon 28.

Positives

• Shareholders received $13.00 in cash per share as part of the merger.
• The contingent value right (CVR) provides an opportunity for additional payment of up to $1.00 per share.
• Restricted stock units vested, providing additional value to holders.

Risks

• The contingent value right (CVR) payment is dependent on the achievement of specified milestones, which may not be met.
• The actual value received from the CVR may be less than the potential $1.00 per share.

Future Outlook

The future payment related to the CVR is contingent upon the achievement of specified milestones as outlined in the CVR Agreement.

Industry Context

The acquisition of Paragon 28 by Zimmer Biomet reflects a trend of consolidation in the medical device industry, where larger companies acquire smaller, specialized firms to expand their product portfolios and market reach, particularly in high-growth segments like foot and ankle solutions.

Comparison to Industry Standards

• Merger and acquisition deals in the medical device industry often involve a combination of upfront cash payments and contingent value rights (CVRs).
• CVRs are used to bridge valuation gaps and align the interests of the acquiring and acquired companies, similar to the Sanofi acquisition of Bioveris.
• The $13.00 cash consideration is comparable to other acquisitions of specialized medical device companies, while the $1.00 CVR provides additional upside potential if milestones are met.
• Zimmer Biomet's acquisition of Paragon 28 is similar to Stryker's acquisition of Wright Medical, both aimed at strengthening their positions in the orthopedic and extremity markets.

Stakeholder Impact

• Shareholders received cash and a contingent value right for each share.
• Employees of Paragon 28 now operate under Zimmer Biomet's ownership.
• The merger may lead to integration and restructuring activities.

Key Dates

Keywords

Merger, Zimmer Biomet, Paragon 28, Contingent Value Right, CVR, Beneficial Ownership, Form 4, Blackford, Shares, Stock