SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported): July 13, 1998
OrthoLogic Corp.
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(Exact name of registrant as specified in its charter)
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Delaware 0-21214 86-0585310
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(State or other jurisdiction of (Commission File Number) (IRS Employer Identification
incorporation) Number)
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1275 West Washington Street, Tempe, Arizona 85281
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(Address of principal executive offices)
Registrant's telephone number, including area code: (602) 437-5520
Not Applicable
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(Former name or former address, if changed since last report.)
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Item 5. Other Events
On July 13, 1998, OrthoLogic Corp. issued the Press Release
filed as Exhibit 99.1 to this Current Report on Form 8-K.
Item 7. Financial Statements and Exhibits.
(c) Exhibits
Exhibit Number Description
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99.1 Press Release, dated July 13, 1998
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ORTHOLOGIC CORP.
Dated: July 13, 1998 /s/ Thomas R. Trotter
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Thomas R. Trotter
Chief Executive Officer and President
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EXHIBIT 99.1
Tempe, Arizona, July 13, 1998 -- OrthoLogic Corp. (Nasdaq: OLGC) today announced
that the company has completed a private equity placement with two investors, an
affiliate of Credit Suisse First Boston Corp. and Capital Ventures
International. Volpe Brown Whelan and Company, LLC acted as financial advisors
to the company for this transaction.
Under the terms of the purchase agreement, OrthoLogic sold 15,000 shares of
Series B Convertible Preferred Stock for $15 million (prior to costs). The
Series B Convertible Preferred Stock is convertible into shares of Common Stock
300 days after issuance and will automatically convert, to the extent not
previously converted, into Common Stock four years following the date of
issuance. Each share of Series B Convertible Preferred Stock is convertible into
Common Stock at a per share price equal to the lesser of the average of the 10
lowest closing bids during the 30 days prior to conversion and 103% of the
average of the closing bids for the 10 days prior to the 300th day following
issuance. The Series B Convertible Preferred Stock is convertible into Common
Stock prior to the 300th day after issuance upon the occurrence of certain
events (in which case the conversion price will be the average of the 10 lowest
closing bids during the 30 days prior to conversion). The agreement contains
strict covenants that protect against hedging and short-selling of OrthoLogic
Common Stock while the purchaser holds shares of the Series B Convertible
Preferred Stock.
In connection with the private placement of the Series B Convertible Preferred
Stock, OrthoLogic issued to the purchasers warrants to purchase 40 shares of
Common Stock for each share of Series B Convertible Preferred Stock, exercisable
at $5.50. The company has agreed to file a registration statement covering the
underlying common stock.
"This financing represents a significant accomplishment for OrthoLogic," said
Thomas R. Trotter, president and CEO. "We chose this method of equity investment
over other currently available options because we believe it could result in
less dilution for our shareholders and will give us more flexibility to address
our near-term investment opportunities."
Proceeds from the private placement will be used to fund new product
opportunities, including SpinaLogic, Chrysalin and Hyalgan as well as to
complete the reengineering of the company's key business processes.
"During the last nine months, we have taken significant steps to revitalize
OrthoLogic," added Trotter. "These included strengthening the senior management
team, reorganizing our field sales force, redesigning our most important
business processes and renewing emphasis on product development. We believe that
these results, combined with our improved financial position, have enhanced our
ability to achieve our most important goal of increasing shareholder value."
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OrthoLogic, founded in 1987, develops, manufactures and markets proprietary
technologically advanced orthopedic devices designed to promote the healing of
musculoskeletal tissue.
For information on OrthoLogic Corp. by facsimile at no cost, call 1-800-PRO-INFO
and dial client code OLGC.
The statements in this release regarding growth, sales and profitability of the
company are forward-looking statements, which are made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements involve risks and uncertainties that could cause
actual results to differ materially. Factors that could cause or contribute to
such differences include, but are not limited to, market acceptance of new
products and development of new products, the acceptance and effectiveness of
new management, potential costs and delays in integrating the direct sales
force, potential costs and delays in integrating acquisitions, and the company's
dependence for sales on approval by third-party payers. The forward-looking
statements should be considered in light of these risks and uncertainties. For a
more complete description of the risks and uncertainties that face the company,
please see the company's annual report on Form 10-K for the fiscal year ended
December 31, 1997.
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