false000184439200018443922023-11-132023-11-13

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 13, 2023

 

 

MARPAI, INC.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware

001-40904

86-1916231

(State or Other Jurisdiction
of Incorporation)

(Commission File Number)

(IRS Employer
Identification No.)

 

 

 

 

 

615 Channelside Drive, Suite 207

 

Tampa, Florida

 

33602

(Address of Principal Executive Offices)

 

(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: 646 303-3483

 

 

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:


Title of each class

 

Trading
Symbol(s)

 


Name of each exchange on which registered

Class A Common Stock, par value $0.0001 per share

 

MRAI

 

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

 


Item 2.02 Results of Operations and Financial Condition.

On November 13, 2023, Marpai, Inc. (“Marpai” or the “Company”) issued a press release providing selected financial information for the three and nine months ended September 30, 2023. A copy of the press release is attached as Exhibit 99.1 hereto and is incorporated by reference into this Item 2.02 in its entirety.

Item 9.01 Financial Statements and Exhibits.

Exhibit
Number

Description

99.1

Press release of Marpai, Inc. dated November 13, 2023

104

Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)

 

 


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.

 

 

 

MARPAI, INC.

 

 

 

 

Date:

November 13, 2023

By:

/s/ Damien Lamendola

 

 

 

Name: Damien Lamendola
Title: Chief Executive Officer

 


EXH 99.1

FOR IMMEDIATE RELEASE img155121336_0.jpg

 

 

 

 

MARPAI, INC. REPORTS Third QUARTER 2023 RESULTS

 

Continued year over year growth related to our acquisition of Maestro Health
Further identification and implementation of synergies and opportunities continue as a result of the acquisition
Veteran industry executive leadership announced along with the addition of a seasoned health care leader to strengthen the Board of Directors
Focus on acceleration of operating efficiencies and customer growth

New York, November 13, 2023 Marpai, Inc. (“Marpai” or the “Company”) (Nasdaq: MRAI), an independent national Third-Party Administrator (TPA) company transforming the $22 billion TPA market supporting self-funded employer health plans, today reported financial results for the third quarter ended September 30, 2023.

 

The Company’s consolidated results of operations include the results of operations of Marpai and its wholly owned subsidiaries, Marpai Health, Inc. and Marpai Administrators, LLC (formerly Continental Benefits, LLC) for all periods presented, and the results of Maestro Health, LLC (“Maestro Health”) since its acquisition on November 1, 2022.

Third Quarter 2023 Highlights:

Total revenue for the three months ended September 30, 2023 was $8.7 million, representing an increase of $3.8 million, or nearly 77%, over the same period in 2022. The primary reason for this increase was due to the revenue from the acquisition of Maestro Health.
The addition of Maestro Health, and organic sales closed by Marpai Administrators, drove a nearly 126% increase in the number of our customers’ employees. As of the end of the third quarter of 2023, the total was approximately 37,000 compared to the same period last year of approximately 16,000.
The Company had an operating loss of approximately $7.0 million for the three months ended September 30, 2023, compared to an operating loss of approximately $5.8 million during the same period in 2022, as the Company continued to focus on closing the gap to profitability.
Net loss was nearly $7.3 million for the three months ended September 30, 2023, compared to net loss of approximately $5.8 million for the three months ended September 30, 2022.
Net loss per share for the three months ended September 30, 2023 was ($0.98) compared to ($1.14) per share from the same period last year.

“I believe that our third quarter results reflect continued momentum towards sustainable profitability,” said Marpai’s new CEO Damien Lamendola. “The pace of improvement achieved and the continued cash burn rate with the volatility of the capital markets drove us to make some rapid changes which we look forward to discussing in our upcoming investors presentation.”


EXH 99.1

 

 

Other Highlights:

 

Withdrawal of Registration Statement on Form S-1

 

The Company has withdrawn its Form S-1 Registration Statement due to adverse market conditions. The Company is currently evaluating its financing opportunities.

Suspending Financial Guidance

 

The Company is suspending further financial guidance for full-year 2023 operating results and will not be providing specific financial guidance moving forward.

Webcast and Conference Call Information

Marpai will host an Investor call and webcast on Wednesday, November 29, 2023 at 8:00 a.m. EST to introduce the new Executive Team members and to provide an overview of the Company’s strategic vision and initiatives in place. Please refer to our Investor Relations website at: https://ir.marpaihealth.com for updates and details.

 

About Marpai, Inc.

 

Marpai, Inc. (Nasdaq: MRAI) is a leading, national TPA (Third Party Administrator) company bringing value oriented health plan services to employers that directly pay for employee health benefits. Primarily competing in the $22 billion TPA sector serving self-funded employer health plans representing over $1 trillion in annual claims. Marpai works to deliver the healthiest member population for the health plan budget. Operating nationwide, Marpai offers access to leading provider networks including Aetna and Cigna and all TPA services. For more information, visit www.marpaihealth.com, the content of which is not incorporated by reference into this press release.

Forward-Looking Statement Disclaimer


This press release contains forward-looking statements, as that term is defined in the Private Litigation Reform Act of 1995, that involve significant risks and uncertainties. Forward-looking statements can be identified through the use of words such as "anticipates," "expects," "intends," "plans," "believes," "seeks," "estimates," “guidance,” "may," "can," "could", "will", "potential", "should," "goal" and variations of these words or similar expressions. For example, the Company is using forward looking statements when it discusses its belief that the third quarter results reflect continued momentum towards sustainable profitability. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect Marpai's current expectations and speak only as of the date of this release. Actual results may differ materially from Marpai's current expectations depending upon a number of factors. These factors include, among others, adverse changes in general economic and market conditions, competitive factors including but not limited to pricing pressures and new product introductions, uncertainty of customer acceptance of new product offerings and market changes, risks associated with managing the growth of the business. Except as required by law, Marpai does not undertake any responsibility to revise or update any forward-looking statements whether as a result of new information, future events or otherwise.


EXH 99.1

More detailed information about Marpai and the risk factors that may affect the realization of forward-looking statements is set forth in Marpai's filings with the Securities and Exchange Commission. Investors and security holders are urged to read these documents free of charge on the SEC's web site at http://www.sec.gov.

 

Media contact:
Laurie Gardner

Lgardner@marpaihealth.com

Investor Relations contact:
Steve Johnson

steve.johnson@marpaihealth.com

 

 

###

 


EXH 99.1

MARPAI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEET

(in thousands,, except share and per share data)

(UNAUDITED)

 

 

 

September 30, 2023

 

December 31, 2022

 

(Unaudited)

 

 

ASSETS:

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

 $ 3,018

 

 $ 13,764

Restricted cash

 

  11,234

 

  9,353

Accounts receivable, net of allowance for credit

losses of $23,458 and $23,458

 

  977

 

  1,438

Unbilled receivable

 

  595

 

  350

Prepaid expenses and other current assets

 

  961

 

  1,602

Other receivables

 

  32

 

  31

Total current assets

 

  16,817

 

  26,538

 

 

 

 

 

Property and equipment, net

 

  663

 

  1,506

Capitalized software, net

 

  2,743

 

  4,589

Operating lease right-of-use assets

 

  2,520

 

  3,842

Goodwill

 

  6,035

 

  5,837

Intangible assets, net

 

  5,502

 

  6,323

Security deposits

 

  1,309

 

  1,293

Other long-term asset

 

  22

 

  22

Total assets

 

 $ 35,611

 

 $ 49,950

LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable

 

 $ 3,101

 

 $ 1,458

Accrued expenses

 

  4,660

 

  5,275

Accrued fiduciary obligations

 

  9,878

 

  9,024

Deferred revenue

 

  1,261

 

  289

Current portion of operating lease liabilities

 

  600

 

  1,311

Other short-term liabilities

 

  947

 

  —

Due to related party

 

  —

 

  3

Total current liabilities

 

  20,447

 

  17,360

 

 

 

 

 

Other long-term liabilities

 

  19,113

 

  20,203

Operating lease liabilities, net of current portion

 

  3,813

 

  4,772

Deferred tax liabilities

 

  1,480

 

  1,480

Total liabilities

 

  44,853

 

  43,815

COMMITMENTS AND CONTINGENCIES

 

 

 

 

STOCKHOLDERS’ (DEFICIT) EQUITY

 

 

 

 

Common stock, $0.0001 par value, 227,791,050 shares authorized; 7,810,625 and 5,319,758 issued and outstanding at September 30, 2023 and December 31, 2022, respectively (1)

 

  1

 

  1

Additional paid-in capital

 

  62,476

 

  54,128

Accumulated deficit

 

  (71,719)

 

  (47,993)

Total stockholders’ (deficit) equity

 

  (9,242)

 

  6,135

Total liabilities and stockholders’ (deficit) equity

 

 $ 35,611

 

 $ 49,950

(1) Reflects 1-for-4 reverse stock split that became effective June 29, 2023. See Note 1 to the unaudited condensed consolidated financial statements.

 


EXH 99.1

 

MARPAI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

(in thousands, except share and per share data)

(Unaudited)

 

 

 

Three Months Ended

 

September 30, 2023

 

September 30, 2022

Revenue

 

 $ 8,729

 

 $ 4,938

Costs and expenses

 

 

 

 

Cost of revenue (exclusive of depreciation and amortization

 shown separately below)

 

                 5,691

 

                          3,626

General and administrative

 

               4,986

 

                          2,718

Sales and marketing

 

             1,842

 

1,054

Information technology

 

            1,269

 

                          1,538

Research and development

 

                267

 

                             782

Depreciation and amortization

 

                 927

 

                             842

Loss on disposal of assets

 

                     7

 

Facilities

 

 768

 

193

Total costs and expenses

 

  15,757

 

  10,753

Operating loss

 

  (7,028)

 

  (5,815)

Other income (expenses)

 

 

 

 

Other income

 

  130

 

  56

Interest expense, net

 

  (384)

 

  (3)

Foreign exchange (loss) gain

 

  (14)

 

  (19)

Loss before provision for income taxes

 

  (7,296)

 

  (5,781)

Income tax expense

 

  —

 

  —

Net loss

 

 $ (7,296)

 

 $ (5,781)

Net loss per share, basic & fully diluted (1)

 

 $ (0.98)

 

 $ (1.14)

Weighted average common shares outstanding, basic and
   diluted (1)

 

  7,479,401

 

  5,087,164

(1) Reflects 1-for-4 reverse stock split that became effective June 29, 2023. See Note 1 to the unaudited condensed consolidated financial statements.

 

 

 

 

 

 

 

 

 

 

 


EXH 99.1

 

 

 

 

 

 

 

 

 

MARPAI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

(in thousands, except share and per share data)

(Unaudited)

 

 

 

Nine Months Ended

 

 

September 30, 2023

 

September 30, 2022

Revenue

 

 

 $ 28,448

 

 $ 16,713

Costs and expenses

 

 

 

 

 

Cost of revenue (exclusive of depreciation and

amortization shown separately below)

 

 

  18,530

 

  12,324

General and administrative

 

 

  15,938

 

  7,940

Sales and marketing

 

 

  5,494

 

  4,830

Information technology

 

 

  4,775

 

  3,862

Research and development

 

 

  1,291

 

  2,684

Depreciation and amortization

 

 

  2,974

 

  2,444

Loss on disposal of assets

 

 

  350

 

  60

Facilities

 

 

  1,918

 

  586

Total costs and expenses

 

 

  51,270

 

  34,730

Operating loss

 

 

  (22,822)

 

  (18,017)

Other income (expenses)

 

 

 

 

 

Other income

 

 

  231

 

  95

Interest expense, net

 

 

  (1,102)

 

  (7)

Foreign exchange (loss) gain

 

 

  (32)

 

  (5)

Loss before provision for income taxes

 

 

  (23,725)

 

  (17,934)

Income tax expense

 

 

  —

 

  —

Net loss

 

 

 $ (23,725)

 

 $ (17,934)

Net loss per share, basic & fully diluted (1)

 

 

 $ (3.62)

 

 $ (3.58)

Weighted average common shares outstanding, basic and
   diluted (1)

 

 

  6,552,575

 

  5,004,779

 

(1) Reflects 1-for-4 reverse stock split that became effective June 29, 2023. See Note 1 to the unaudited condensed consolidated financial statements.

 

 

 

 

 

 

 

 


EXH 99.1

 

 

 

 

 

 

 

 

 

 

 

 

MARPAI, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands, except share and per share data)

(Unaudited)

 

 

Nine Months Ended

 

September 30, 2023

 

September 30, 2022

Cash flows from operating activities:

 

 

 

 

Net loss

 

 $ (23,725)

 

 $ (17,934)

Adjustments to reconcile net loss to net cash used in

operating activities:

 

 

 

 

Depreciation and amortization

 

  2,974

 

  2,444

Loss on disposal of assets

 

  350

 

  60

Share-based compensation

 

  1,837

 

  2,433

Shares issued to vendors in exchange for services

 

  79

 

  31

Amortization of right-of-use asset

 

  1,289

 

  517

Gain on termination of lease

 

  33

 

  —

Non-cash interest

 

  1,204

 

  —

Changes in operating assets and liabilities:

 

 

 

 

Accounts receivable and unbilled receivable

 

  641

 

  16

Prepaid expense and other assets

 

  216

 

  377

Other receivables

 

  (2)

 

  35

Security deposit

 

  (16)

 

  —

Accounts payable

 

  336

 

  (433)

Accrued expenses

 

  (693)

 

  (436)

Accrued fiduciary obligations

 

  853

 

  (1,642)

Operating lease liabilities

 

  (1,670)

 

  (512)

Due To related party

 

  (3)

 

  —

Other liabilities

 

  973

 

  (295)

Net cash used in operating activities

 

  (15,324)

 

  (15,339)

Cash flows from investing activities:

 

 

 

 

Capitalization of software development costs

 

  —

 

  (810)

Disposal of property and equipment

 

  27

 

  —

Purchase of property and equipment

 

  —

 

  (70)

Net cash provided by (used in) investing activities

 

  27

 

  (880)

Cash flows from financing activities:

 

 

 

 

Proceeds from stock options exercises

 

  0

 

  —

Proceeds from issuance of common stock in a public

offering, net

 

  6,432

 

  —

Net cash provided by financing activities

 

  6,432

 

  —

 

 

 

 

 

Net decrease in cash, cash equivalents and restricted cash

 

  (8,865)

 

  (16,219)

 

 

 

 

 

Cash, cash equivalents and restricted cash at beginning of period

 

  23,117

 

  25,934

Cash, cash equivalents and restricted cash at end of period

 

 $ 14,252

 

 $ 9,715

 

 

 

 

 


EXH 99.1

Reconciliation of cash, cash equivalents, and restricted cash reported in the condensed consolidated balance sheet

 

 

 

 

Cash and cash equivalents

 

 $ 3,018

 

 $ 4,748

Restricted cash

 

  11,234

 

  4,966

Total cash, cash equivalents and restricted cash shown in the condensed consolidated statement of cash flows

 

 $ 14,252

 

 $ 9,714

Supplemental disclosure of non-cash activity

 

 

 

 

Measurement period adjustment to Goodwill

 

 $ 198

 

 $ —


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Nov. 13, 2023
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Document Type 8-K
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Document Period End Date Nov. 13, 2023
Entity Registrant Name MARPAI, INC.
Entity Central Index Key 0001844392
Entity Emerging Growth Company true
Securities Act File Number 001-40904
Entity Incorporation, State or Country Code DE
Entity Tax Identification Number 86-1916231
Entity Address, Address Line One 615 Channelside Drive, Suite 207
Entity Address, City or Town Tampa
Entity Address, State or Province FL
Entity Address, Postal Zip Code 33602
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Title of 12(b) Security Class A Common Stock, par value $0.0001 per share
Trading Symbol MRAI
Security Exchange Name NASDAQ

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