-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WZungQzNiO7ws9a+tq0rO5KdAvjayvFUM7Q80BMg4GxRUTQ/+dkEt/MZZKP4oK6V fCG66jdXnZZQI4V+U6THrg== 0000950109-95-004006.txt : 19951003 0000950109-95-004006.hdr.sgml : 19951003 ACCESSION NUMBER: 0000950109-95-004006 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19950719 ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 19950929 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: OXIS INTERNATIONAL INC CENTRAL INDEX KEY: 0000109657 STANDARD INDUSTRIAL CLASSIFICATION: PHARMACEUTICAL PREPARATIONS [2834] IRS NUMBER: 941620407 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-08092 FILM NUMBER: 95577656 BUSINESS ADDRESS: STREET 1: 6040 N CUTTER CIRCLE STE 317 CITY: PORTLAND STATE: OR ZIP: 97217 BUSINESS PHONE: 5032833911 MAIL ADDRESS: STREET 1: 6040 N CUTTER CIRCLE STE 317 CITY: PORTLAND STATE: OR ZIP: 97217 FORMER COMPANY: FORMER CONFORMED NAME: DDI PHARMACEUTICALS INC DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: DIAGNOSTIC DATA INC /DE/ DATE OF NAME CHANGE: 19850312 8-K/A 1 FORM 8-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K/A CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 September 28, 1995 (Earliest event reported - July 19, 1995) Commission File Number 0-8092 OXIS INTERNATIONAL, INC. A Delaware corporation I.R.S. Employer Identification No. 94-1620407 6040 N. Cutter Circle, Suite 317 Portland, OR 97217 Telephone: (503) 283-3911 FAX: (503) 283-4058 Item 7. Financial Statements and Exhibits - ------------------------------------------ (a) and (b) Financial Statements and Pro Forma Financial Information -------------------------------------------------------- On August 3, 1995, the Company filed a Report on Form 8-K reporting the acquisition of Therox Pharmaceuticals, Inc. ("Therox"). The Report on Form 8-K indicated that additional financial information would be filed under cover of a Form 8-K/A report. The additional financial information is provided herewith, as follows. . Audited financial statements of Therox as of, and for the two years ended, December 31, 1994. . Unaudited financial statements of Therox as of, and for the three months ended March 31, 1995. . Pro forma balance sheets for the two companies combined as of December 31, 1994 and March 31, 1995. . Pro forma statements of operations for the two companies for the year ended December 31, 1994 and for the three months ended March 31, 1995. (c) Exhibits -------- Exhibit 99(1) Audited financial statements of Therox as of, and for the two years ended, December 31, 1994. Exhibit 99(2) Unaudited financial statements of Therox as of, and for the three months ended March 31, 1995. Exhibit 99(3) Unaudited pro forma financial information including: . A pro forma balance sheet for the two companies combined as of December 31, 1994. . A pro forma statement of operations for the two companies combined for the year ended December 31, 1994. . A pro forma balance sheet for the two companies combined as of March 31, 1995. . A pro forma statement of operations for the two companies combined for the three months ended March 31, 1995. 2 SIGNATURE 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. September 28, 1995 OXIS International, Inc. s/ Jon S. Pitcher ----------------------- Jon S. Pitcher Chief Financial Officer 3 EXHIBIT INDEX
Page Exhibit Number - ------- ------ 99(1) Audited financial statement of Therox as of, and for the two years ended, December 31, 1994. 5 99(2) Unaudited financial statements of Therox as of, and for the three months ended March 31, 1995. 14 99(3) Unaudited pro forma financial information including: 19 . A pro forma balance sheet for the two companies combined as of December 31, 1994. . A pro forma statement of operations for the two companies combined for the year ended December 31, 1994. . A pro forma balance sheet for the two companies combined as of March 31, 1995. . A pro forma statement of operations for the two companies combined for the three months ended March 31, 1995.
4 EX-99.1 2 THEROX AUDITED FINANCIAL STATEMENT EXHIBIT 99(1) Audited Financial Statements Therox Pharmaceuticals, Inc. December 31, 1994 and 1993 5 [LETTERHEAD OF BARNA, KOWALL & COMPANY APPEARS HERE] REPORT OF INDEPENDENT AUDITORS Board of Directors and Shareholders Therox Pharmaceuticals, Inc. We have audited the accompanying balance sheets of Therox Pharmaceuticals, Inc. (a development stage enterprise) as of December 31, 1994 and 1993, and the related statement of operations, and shareholders' equity and cash flows for the year ended December 31, 1994 and the period from July 1, 1993 (date of inception) to December 31, 1993. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material aspects, the financial position of Therox Pharmaceuticals, Inc. at December 31, 1994 and 1993 and the results of its operation and its cash flows for the year ended December 31, 1994 and for the period from July 1, 1993 (date of inception) to December 31, 1993, in conformity with generally accepted accounting principles. /s/ Barna, Kowall & Company June 22, 1995 6 THEROX PHARMACEUTICALS, INC. (A Development Stage Enterprise) BALANCE SHEETS
December 31, 1994 1993 ----------- ----------- ASSETS Current Assets Cash $ 470,740 $ 894,358 Prepaid expenses 5,000 ----------- ----------- Total Current Assets 475,740 894,358 Property and Equipment Equipment used in research 21,473 4,208 Less allowance for depreciation ( 2,989) ( 421) ----------- ----------- 18,484 3,787 Other assets, net of accumulated amortization of $2,250 and $750 in 1994 and 1993 respectively. 12,750 14,250 ----------- ----------- TOTAL ASSETS $ 506,974 $ 912,395 =========== =========== LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities Accounts payable $ 122,918 $ 9,176 Payroll taxes payable 1,784 ----------- ----------- Total Current Liabilities 124,702 9,176 SHAREHOLDERS' EQUITY Series A,Preferred stock, $.001 par value: Authorized shares- 1,000,000 shares Issued and outstanding- 1,000,000 shares 1,000 1,000 Additional paid-in-capital 979,000 979,000 Common stock, $.001 par value: Authorized shares- 2,000,000 shares (1,000,000 shares at December 31, 1993) Issued and outstanding- 283,000 shares 283 283 Deficit accumulated during development stage ( 598,011) ( 77,064) ----------- ----------- 382,272 903,219 ----------- ----------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 506,974 $ 912,395 =========== ===========
See accompanying notes to financial statements. 7 THEROX PHARMACEUTICALS, INC. (A Development Stage Enterprise) STATEMENT OF OPERATIONS Year Ended December 31, 1994 and for the Period from July 1, 1993 (Date of Inception) to December 31, 1993
Cumulative December 31, from 1994 1993 July 1,1993 ----------- ----------- ----------- Research and development expenses $ 526,039 $ 66,046 $ 592,085 General and administrative expenses 10,530 14,353 24,883 ----------- ----------- ----------- Total expenses 536,569 80,399 616,968 Other income (expense): Interest income 15,622 3,335 18,957 ----------- ----------- ----------- Net loss $ 520,947 $ 77,064 $ 598,011 =========== =========== ===========
See accompanying notes to financial statements. 8 THEROX PHARMACEUTICALS, INC. (A Development Stage Enterprise) STATEMENT OF SHAREHOLDERS' EQUITY
Series A Preferred Stock Common Stock Deficit ---------------------- ---------------------- Accumulated Number Number during Additional of of Development Paid-In Shares Amount Shares Amount Stage Capital Total ---------- ---------- ---------- ---------- ---------- ---------- ---------- Balance July 1, 1993 --- $ --- --- $ --- $ --- $ --- $ --- Issuance of Series A preferred stock, net of expense 1,000,000 1,000 979,000 980,000 Issuance of common stock 283,000 283 283 Net loss ( 77,064) ( 77,064) ---------- ---------- ---------- ---------- ----------- ---------- ----------- Balance December 31, 1993 1,000,000 1,000 283,000 283 ( 77,064) 979,000 903,219 Net loss ( 520,947) (520,947) ---------- ---------- ---------- ---------- ----------- ---------- ----------- Balance December 31, 1994 1,000,000 $ 1,000 283,000 $ 283 $ (598,011) $ 979,000 $ 382,272 ========== ========== ========== ========== =========== =========== ===========
See accompanying notes to financial statements. 9 THEROX PHARMACEUTICALS, INC. (A Development Stage Enterprise) STATEMENT OF CASH FLOWS Year Ended December 31, 1994 and for the Period from July 1, 1993 (Date of Inception) to December 31, 1993
Cumulative December 31, from 1994 1993 July 1,1993 ----------- ----------- ----------- OPERATING ACTIVITIES Net loss $ ( 520,947)$ ( 77,064)$ ( 598,011) Adjustments to reconcile net loss to net cash used by operating activities: Depreciation 2,568 421 2,989 Amortization 1,500 750 2,250 (Increase) decrease in: Prepaid expenses ( 5,000) ( 5,000) Increase (decrease) in: Accounts payable 113,742 9,176 122,918 Payroll taxes payable 1,784 1,784 ----------- ----------- ----------- NET CASH USED BY OPERATING ACTIVITIES ( 406,353) ( 66,717) ( 473,070) INVESTING ACTIVITIES Purchase of equipment used in research ( 17,265) ( 4,208) ( 21,473) Purchase of intangibles ( 15,000) ( 15,000) ----------- ----------- ----------- NET CASH (USED) BY INVESTING ACTIVITIES ( 17,265) ( 19,208) ( 36,473) FINANCING ACTIVITIES Proceeds from issuance of stock, net of expense 0 980,283 980,283 ----------- ----------- ----------- NET CASH PROVIDED BY FINANCING ACTIVITIES 0 980,283 980,283 ----------- ----------- ----------- NET INCREASE (DECREASE) IN CASH ( 423,618) 894,358 470,740 Cash at beginning of year 894,358 0 0 ----------- ----------- ----------- CASH AT END OF YEAR $ 470,740 $ 894,358 $ 470,740 =========== =========== =========== Cash paid for interest $ 0 $ 0 $ 0 =========== =========== ===========
See accompanying notes to financial statements. 10 THEROX PHARMACEUTICALS, INC. (A Development Stage Enterprise) NOTES TO FINANCIAL STATEMENTS December 31, 1994 and 1993 NOTE A--SIGNIFICANT ACCOUNTING POLICIES Background Therox Pharmaceutical, Inc. (formerly Anti-Ox, Inc.), (the Company), is a development stage enterprise formed in July 1993 for the purpose of conducting research and development of new pharmaceutical technology. Upon the discovery of any new technology, the Company will develop and market the related products. The Company conducts its research primarily through consultants in conjunction with several universities under research agreements that permit the Company to either retain ownership or licensing rights for any discoveries. Accounts payable include $118,540 of amounts owed under these agreements for research performed prior to December 31, 1994. The Company is obligated to fund up to an additional $147,500 under terms of certain research agreements that expire August 31, 1995. Amounts are subject to completion of the agreed upon research by the respective university. The Company has operated as a development stage enterprise since its inception and has not recognized any operating revenues. Property and Equipment Property and equipment are stated at cost. Depreciation is computed using straight line methods over the estimated useful lives of the assets (five years). Other Assets Other assets consist of amounts paid for a licensing agreement for patented items. Amortization is computed using the straight line method over the remaining lives of the patents, (approximately ten to seventeen years). Employee Benefit Plan The Company does not sponsor any qualified employee benefit plans or post employment benefit plans. NOTE B--CAPITALIZATION In December 1993 the Company issued 1,000,000 shares of Series A preferred stock for net consideration of $980,000. Series A preferred stock are convertible to common, have voting rights and liquidation preferences over common stock, and has a dividend rate of $.08. Dividends are cumulative, begin to accrue in December of 1995 and are payable in preferred stock. In December 1993 the Company issued 283,000 shares of common stock for a consideration of $283. The Company has reserved 525,000 shares of common stock for issuance under stock options and 1,000,000 shares for conversion of preferred stock. 11 THEROX PHARMACEUTICALS, INC. (A Development Stage Enterprise) NOTES TO FINANCIAL STATEMENTS December 31, 1994 and 1993 NOTE C--STOCK OPTION PLAN AND STOCK OPTION AGREEMENT In 1994, the Company reserved 500,000 shares of common stock for issuance pursuant to its stock option plan. The Company has granted options to purchase common stock to certain employees, directors and consultants. As of December 31, 1994 options were granted to purchase 100,000 shares of common stock at $.10 per share (no options were granted in 1993). No options were exercised in 1994 or 1993. In February 1994, the Company granted options to purchase 25,000 shares of common stock to a preferred shareholder, Brantley Venture Partners II, L.P., at $.01 per share. No options were exercised as of December 31, 1994 under this agreement. NOTE D--INCOME TAXES At December 31, 1994, the Company had net operating loss carryforwards available to offset future taxable income of approximately $598,011, which expire in the years 2008 and 2009. Net operating loss carryforwards for financial reporting purposes and alternative minimum tax reporting purposes are approximately the same as those under the regular tax method. Net operating losses may be subject to certain tax law restrictions in the event of a change in ownership, as defined. The amount of this restriction, if any, has not been determined. Deferred income taxes reflect the temporary differences between the carrying values of assets and liabilities for financial reporting purposes and the amounts for income tax purposes. The significant components of the Company's deferred tax assets and liabilities as of December 31, 1994 and 1993 are as follows:
1994 1993 ----------- ----------- Deferred tax assets: Net operating loss carryforwards $ 203,000 $ 22,000 Valuation allowance ( 203,000) ( 22,000) ----------- ----------- $ --- $ --- =========== ===========
No income taxes were paid in 1994 and 1993. NOTE E--RELATED PARTY TRANSACTIONS The president of the Company is also a general partner in Brantley Venture Partners II, L.P., a principal investor in Series A convertible preferred stock. The president received no compensation in 1994 and 1993. 12 THEROX PHARMACEUTICALS, INC. (A Development Stage Enterprise) NOTES TO FINANCIAL STATEMENTS December 31, 1994 and 1993 NOTE F--LEASES The Company incurred lease expense of $1,565 in 1994 and had no lease expense in 1993. The Company has future minimum lease commitments of $2,292 in 1996 and 1997, and $1,337 in 1998. NOTE G--SUBSEQUENT EVENTS The Company has signed a letter of intent with OXIS International, Inc. (OXIS), whereby OXIS would acquire all of the issued and outstanding stock of the Company in exchange for 1,440,736 shares of OXIS common stock and other considerations. The Company's option holders are permitted to either convert their options to Company common stock and then exchange the stock for OXIS stock, or exchange the options for OXIS options. Subsequent to December 31, 1994, the Company agreed to grant options to purchase an additional 33,000 shares of common stock at $.10 per share. The Company also agreed to issue 53,000 shares of common stock as compensation under consulting and license agreements. On May 15, 1995 the Company entered into a three year lease agreement (with an option for an additional year) for laboratory and office space. Rent under the agreement is $90,000 in the first year, $114,000 in the second year, and $138,000 in the third year. Concurrent with the lease agreement, the Company entered into an agreement for services with the landlord for various telephone, computer, laboratory and waste disposal services. Costs for these services is calculated on a usage and number of employee basis. The Company has made arrangements for a $50,000 loan from a principal investor in Series A convertible preferred stock, S.R. One, Limited, that will be convertible into approximately 16,250 shares of newly issued Series B convertible preferred stock at $2.95 per share. 13 EX-99.2 3 THEROX BALANCE SHEET EXHIBIT 99(2) THEROX PHARMACEUTICALS, INC. (A Development Stage Enterprise) Balance Sheet (Unaudited) March 31, 1995 ASSETS Current assets Cash $343,806 Prepaid expenses -- -------- Total current assets 343,806 Property and equipment Equipment used in research 21,473 Less allowance for depreciation (4,063) -------- 17,410 Other assets, net of accumulated amortization of $2,625 12,375 -------- Total assets $373,591 ======== LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities Accounts payable $ 166,985 Accrued payroll and payroll taxes 3,940 --------- Total current liabilities 170,925 Shareholders' equity Series A, Preferred stock, $.001 par value: Authorized shares - 1,000,000 shares Issues and outstanding - 1,000,000 shares 1,000 Additional paid-in-capital 979,000 Common stock, $.001 par value: Authorized shares - 2,000,000 shares Issued and outstanding - 283,000 shares 283 Deficit accumulated during development stage (777,617) --------- 202,666 --------- Total liabilities and shareholders' equity $ 373,591 =========
14 THEROX PHARMACEUTICALS, INC. (A Development Stage Enterprise) Statement of Operations (Unaudited) Period Ended March 31, 1995 and for the Period from July 1, 1993 (date of inception) to March 31, 1995
Cumulative March 31, from 1995 July 1, 1993 --------- ------------ Research and development expenses $176,722 $768,807 General and administrative expense 5,468 30,351 -------- -------- Total expenses 182,190 799,158 Other income (expense) Interest income 2,584 21,541 -------- -------- Net loss $179,606 $777,617 ======== ========
15 THEROX PHARMACEUTICALS, INC. (A Development Stage Enterprise) Statement of Shareholders' Equity (Unaudited)
Deficit Accumulated Series A During Additional Preferred Common Development Paid-In Stock Stock Stage Capital Total --------- ------ ----------- ---------- ----- Balance July 1, 1993 $ -- $ -- $ -- $ -- $ -- Issuance of 1,000,000 shares Series A Preferred Stock, net of expense 1,000 -- 979,000 980,000 Issuance of 283,000 shares 283 283 Net loss (77,064) (77,064) ------ ---- --------- -------- --------- Balance December 31, 1993 1,000 283 (77,064) 979,000 903,219 Net loss (520,947) (520,947) ------ ---- --------- -------- --------- Balance December 31, 1994 1,000 283 (598,011) 979,000 382,272 Net loss (179,606) (179,606) ------ ---- --------- -------- --------- Balance March 31, 1995 $1,000 $283 $(777,617) $979,000 $ 202,666 ====== ==== ========= ======== =========
16 THEROX PHARMACEUTICALS, INC. (A Development Stage Enterprise) Statement of Cash Flows (Unaudited) Period Ended March 31, 1995 and for the Period from July 1, 1993 (date of inception) to March 31, 1995
Cumulative March 31, from 1995 July 1, 1993 ---------- ------------- Operating activities Net loss $(179,606) $(777,617) Adjustments to reconcile net loss to net cash used by operating activities: Depreciation 1,074 4,063 Amortization 375 2,625 (Increase) decrease in prepaid expenses 5,000 -- Increase (decrease) in: Accounts payable 44,067 166,985 Accrued payroll and taxes 2,156 3,940 --------- --------- Net cash used by operating activities (126,934) (600,004) Investing activities Purchase of equipment used in research -- (21,473) Purchase of intangibles -- (15,000) --------- --------- Net cash (used) by investing activities -- (36,473) Financing activities Proceeds from issuance of stock, net of expense -- 980,283 --------- --------- Net cash provided by financing activities -- 980,283 --------- --------- Net increase (decrease) in cash (126,934) 343,806 Cash at beginning of period 470,740 -- --------- --------- Cash at March 31, 1995 $ 343,806 $ 343,806 ========= ========= Cash paid for interest -- -- ========= =========
17 CONDENSED NOTE TO FINANCIAL STATEMENTS The unaudited financial statements do not include all of the information and notes required by generally accepted accounting principles for complete financial statements. All adjustments considered necessary by management for a fair presentation have been included. Operating results for interim periods are not necessarily indicative of the results that may be expected for the full year. 18 EX-99.3 4 PRO FORMA FINANCIAL INFORMATION EXHIBIT 99(3) OXIS International, Inc. and Therox Pharmaceuticals, Inc. Unaudited Pro Forma Financial Information On July 19, 1995, OXIS International, Inc. ("OXIS") consummated the acquisition of Therox pursuant to a transaction wherein Therox was merged with and into a wholly-owned subsidiary of OXIS. The unaudited pro forma financial information presented below combines the balance sheets of OXIS and Therox as of December 31, 1994 and March 31, 1995 and the statements of operations for the year ended December 31, 1994, and the three months ended March 31, 1995 on a pro forma basis. This pro forma combination gives effect to the following assumptions. . That the acquisition of Therox by OXIS occurred as of the beginning of each of the periods presented. . That the Therox acquisition would be accounted for as a purchase. . That the purchase price paid by OXIS to acquire Therox will be $3,353,313, consisting of 1,440,736 shares of OXIS Common Stock valued at 2.3275 per share. This valuation is based on the average of the closing price of OXIS Common Stock from July 14, 1995 through July 20, 1995, the day after the consummation of the acquisition, discounted 30% for certain trading restrictions and the number of shares of OXIS Common Stock being issued in the transaction, as compared to the average trading volume of OXIS Common Stock. . That holders of Therox stock options would exercise their options, resulting in additional equity for Therox of $68,850, prior to the acquisition. . That, simultaneous to the acquisition, the two major Therox shareholders would purchase 642,583 shares of OXIS Series B Preferred Stock for an aggregate purchase price of $1,500,000. . That the excess of the purchase price paid over the shareholders' equity of Therox would be allocated entirely to technology for in-process products and charged to expense in the first statement of operations for the combined companies. It should be noted that the unaudited pro forma financial information: . does not give effect to any costs of combining the companies or to any efficiencies in operations that could be achieved by combining the companies, . does not purport to be indicative either of the results of operations that would have occurred had the acquisition been consummated at the date indicated, or of future combined results of operations of the companies. 19 The unaudited pro forma financial information presented below should be read in conjunction with the notes hereto and the separate financial statements of the two companies. Unaudited financial statements of the Company as of June 30, 1995 are included in the Company's second quarter Form 10-Q report filed with the Securities and Exchange Commission. Financial statements of Therox as of December 31, 1994 and March 31, 1995 are included in this report on Form 8-K/A. 20 Unaudited Pro Forma Balance Sheet of OXIS International, Inc. (OXIS International, Inc., and Therox Pharmaceuticals, Inc.) Combined as of December 31, 1994
Pro forma Pro forma ASSETS OXIS Therox adjustments combined ---- ------ ----------- --------- Current assets: Cash and cash equivalents $ 936,000 $471,000 $ 69,000 (1) $ 2,976,000 1,500,000 (4) Certificates of deposit 496,000 496,000 Accounts receivable 740,000 740,000 Inventories 673,000 673,000 Prepaid and other 228,000 5,000 233,000 ----------- -------- ----------- ----------- Total current assets 3,073,000 476,000 1,569,000 5,118,000 Property and equipment, net 1,298,000 18,000 1,316,000 Assets under capital leases, net 1,340,000 1,340,000 Technology for in-process products 2,902,000 (2) 0 (2,902,000) (3) Technology for developed products and custom assays, net 5,215,000 5,215,000 Other assets 268,000 13,000 281,000 ----------- -------- ----------- ----------- Total assets $11,194,000 $507,000 $ 1,569,000 $13,270,000 =========== ======== =========== ===========
21 Unaudited Pro Forma Balance Sheet of OXIS International, Inc. (OXIS International, Inc., and Therox Pharmaceuticals, Inc.) Combined as of December 31, 1994 LIABILITIES AND SHAREHOLDERS' EQUITY
Pro forma Pro forma OXIS Therox adjustments combined ---- ------ ----------- --------- Current liabilities: Note payable to bank $ 340,000 $ 340,000 Accounts payable 1,562,000 $ 123,000 1,685,000 Customer deposits 1,116,000 1,116,000 Accrued liabilities 628,000 2,000 $ 133,000 (5) 763,000 Current portion of capital lease obligations 473,000 473,000 ----------- --------- ----------- ------------ Total current liabilities 4,119,000 125,000 133,000 4,377,000 Capital lease obligations 297,000 297,000 Other liabilities 79,000 79,000 Shareholders' equity: Preferred stock: OXIS 0 6,000 (4) 6,000 Therox 1,000 (1,000) (2) 0 Common stock: OXIS 4,661,000 720,000 (2) 5,381,000 Therox 0 Additional paid-in capital: OXIS 20,230,000 2,633,000 (2) 24,224,000 1,494,000 (4) (133,000) (5) Therox 979,000 69,000 (1) 0 (1,048,000) (2) Accumulated deficit: OXIS (18,139,000) (2,902,000) (3) (21,041,000) Therox (598,000) 598,000 (2) 0 Accumulated translation adjustments (53,000) (53,000) ----------- --------- ----------- ------------ Total shareholders' equity 6,699,000 382,000 1,436,000 8,517,000 ----------- --------- ----------- ------------ Total liabilities and shareholders' equity $11,194,000 $ 507,000 $ 1,569,000 $ 13,270,000 =========== ========= =========== ============
22 Notes to Unaudited Pro Forma Balance Sheet December 31, 1994 1. To reflect cash paid for exercise of Therox stock options prior to the acquisition of Therox by OXIS. 2. To reflect the pro forma purchase price, $3,353,313, paid to acquire Therox, consisting of 1,440,736 shares of OXIS Common Stock at $2.3275 per share. This valuation is based on the average of the closing price of OXIS Common Stock from July 14, 1995 through July 20, 1995, the day after the consummation of the acquisition, discounted 30% for certain trading restrictions and the number of shares of OXIS Common Stock being issued in the transaction, as compared to the average trading volume of OXIS Common Stock. The excess of the pro forma purchase price over the shareholders' equity of Therox has been allocated entirely to technology for in-process products. Stock issued in connection with the acquisition has been recorded in shareholders' equity as follows: Common Stock, 1,440,736 shares at $.50 par $ 720,000 Additional paid-in capital 2,633,000 ---------- Stock issued - 1,440,736 shares at $2.3275 per share $3,353,000 ==========
3. The amount allocated to technology on in-process products will be charged to expense in the first statement of operations for the combined companies inasmuch as these amounts relate to research and development for which there is no alternative future use. Consequently, the unaudited pro forma balance sheet has been prepared to present the total assets and shareholders' equity immediately following this write off. 4. To reflect $1,500,000 cash paid by the two major Therox shareholders for 642,583 shares of OXIS Series B Preferred Stock. The Series B preferred Stock is presented as: 642,583 shares at .01 par $ 6,000 Additional paid in capital 1,494,000 ---------- Cash paid $1,500,000 ==========
5. To reflect a liability for costs directly attributable to issuance of stock. 6. In addition to the OXIS shares issued, the stockholders of Therox may receive up to $2,000,000 based on the successful commercialization of the Therox technologies. No effect has been given in the pro forma balance sheet for this matter. 23 Unaudited Pro Forma Statement of Operations OXIS International, Inc. (OXIS International, Inc., and Therox Pharmaceuticals, Inc.) Combined for the year ended December 31, 1994
Pro forma Pro forma OXIS Therox adjustments combined ---- ------ ----------- --------- Revenues: Sales $ 3,325,000 $ 3,325,000 Royalties 145,000 145,000 ------------ ---------- ----------- ------------ Total revenues 3,470,000 0 3,470,000 Costs and expenses: Cost of sales 2,074,000 2,074,000 Research and development 1,670,000 $ 526,000 2,196,000 Sales, general and administrative 1,652,000 11,000 1,663,000 Purchased in-process technology 3,675,000 3,675,000 ------------ ---------- ----------- ------------ Total costs and expenses 9,071,000 537,000 0 9,608,000 ------------ ---------- ----------- ------------ Operating loss (5,601,000) (537,000) 0 (6,138,000) Interest income 82,000 16,000 98,000 Interest expense (48,000) (48,000) ------------ ---------- ----------- ------------ Net loss ($5,567,000) ($521,000) $0 ($6,088,000) ============ ========== =========== ============ Net loss per OXIS share ($0.88) ($0.50) ============ ============
24 Notes to Unaudited Pro Forma Statement of Operations for the Year Ended December 31, 1994 1. The write off of the pro forma purchase price amount allocated to technology on in-process products is not reflected in the unaudited pro forma statement of operations. This amount relates to research and development in process for which there is no alternative future use and is expected to approximate $2,902,000. This amount will be written off in the initial period of operations of the combined companies. 2. Net loss per OXIS share in the unaudited pro forma statement of operations has been computed based upon 12,124,423 Common Shares outstanding upon consummation of the acquisition. 25 Unaudited Pro Forma Balance Sheet of OXIS International, Inc. (OXIS International, Inc., and Therox Pharmaceuticals, Inc.) Combined as of March 31, 1995
Pro forma Pro forma ASSETS OXIS Therox adjustments combined ---- ------ ----------- --------- Current assets: Cash and cash equivalents $ 724,000 $344,000 $ 69,000 (1) $ 2,637,000 1,500,000 (4) Certificates of deposit 198,000 198,000 Accounts receivable 1,002,000 1,002,000 Inventories 653,000 653,000 Prepaid and other 313,000 313,000 ----------- -------- ----------- ----------- Total current assets 2,890,000 344,000 1,569,000 4,803,000 Property and equipment, net 1,286,000 18,000 1,304,000 Assets under capital leases, net 1,422,000 1,422,000 Technology for in-process products 3,081,000 (2) 0 (3,081,000) (3) Technology for developed products and custom assays, net 5,189,000 5,189,000 Other assets 300,000 12,000 312,000 ----------- -------- ----------- ----------- Total assets $11,087,000 $374,000 $ 1,569,000 $13,030,000 =========== ======== =========== ===========
26 Unaudited Pro Forma Balance Sheet of OXIS International, Inc. (OXIS International, Inc., and Therox Pharmaceuticals, Inc.) Combined as of March 31, 1995 LIABILITIES AND SHAREHOLDERS' EQUITY
Pro forma Pro forma OXIS Therox adjustments combined ---- ------ ----------- --------- Current liabilities: Note payable to bank $ 198,000 $ 198,000 Other notes payable 766,000 766,000 Accounts payable 2,066,000 $ 167,000 2,233,000 Customer deposits 250,000 250,000 Accrued liabilities 661,000 4,000 $ 133,000 (5) 798,000 Current portion of capital lease obligations 431,000 431,000 ------------ -------- ----------- ------------ Total current liabilities 4,372,000 171,000 133,000 4,676,000 Capital lease obligations 267,000 267,000 Other liabilities 76,000 76,000 Shareholders' equity: Preferred stock: OXIS 6,000 (4) 6,000 Therox 1,000 (1,000) (2) 0 Common stock: OXIS 4,708,000 720,000 (2) 5,428,000 Therox 0 Additional paid-in capital: OXIS 20,338,000 2,633,000 (2) 24,332,000 1,494,000 (4) (133,000) (5) Therox 979,000 69,000 (1) 0 (1,048,000) (2) Accumulated deficit: OXIS (18,896,000) (3,081,000) (3) (21,977,000) Therox (777,000) 777,000 (2) 0 Accumulated translation adjustments 222,000 222,000 ------------ -------- ----------- ------------ Total shareholders' equity 6,372,000 203,000 1,436,000 8,011,000 ------------ -------- ----------- ------------ Total liabilities and shareholders' equity $ 11,087,000 $374,000 $ 1,569,000 $ 13,030,000 ============ ======== =========== ============
27 Notes to Unaudited Pro Forma Balance Sheet March 31, 1995 1. To reflect cash paid for exercise of Therox stock options prior to the acquisition of Therox by OXIS. 2. To reflect the pro forma purchase price, $3,353,313, paid to acquire Therox, consisting of 1,440,736 shares of OXIS Common Stock at $2.3275 per share. This valuation is based on the average of the closing price of OXIS Common Stock from July 14, 1995 through July 20, 1995, the day after the consummation of the acquisition, discounted 30% for certain trading restrictions and the number of shares of OXIS Common Stock being issued in the transaction, as compared to the average trading volume of OXIS Common Stock. The excess of the pro forma purchase price over the shareholders' equity of Therox has been allocated entirely to technology for in-process products. Stock issued in connection with the acquisition has been recorded in shareholders' equity as follows: Common Stock, 1,440,736 shares at $.50 par $ 720,000 Additional paid-in capital 2,633,000 ---------- Stock issued - 1,440,736 shares at $2.3275 per share $3,353,000 ==========
3. The amount allocated to technology on in-process products will be charged to expense in the first statement of operations for the combined companies inasmuch as these amounts relate to research and development for which there is no alternative future use. Consequently, the unaudited pro forma balance sheet has been prepared to present the total assets and shareholders' equity immediately following this write off. 4. To reflect $1,500,000 cash paid by the two major Therox shareholders for 642,583 shares of OXIS Series B Preferred Stock. The Series B preferred Stock is presented as: 642,583 shares at .01 par $ 6,000 Additional paid in capital 1,494,000 ---------- Cash paid $1,500,000 ==========
5. To reflect a liability for costs directly attributable to issuance of stock. 6. In addition to the OXIS shares issued, the stockholders of Therox may receive up to $2,000,000 based on the successful commercialization of the Therox technologies. No effect has been given in the pro forma balance sheet for this matter. 28 Unaudited Pro Forma Statement of Operations OXIS International, Inc. (OXIS International, Inc., and Therox Pharmaceuticals, Inc.) Combined for the three months ended March 31, 1995
Pro forma Pro forma OXIS Therox adjustments combined ---- ------ ----------- --------- Revenues: Sales $2,075,000 $2,075,000 Royalties 51,000 51,000 ---------- ---------- ----------- ---------- Total revenues 2,126,000 2,126,000 Costs and expenses: Cost of sales 1,177,000 1,177,000 Research and development 1,029,000 $ 177,000 1,206,000 Sales, general and administrative 645,000 5,000 650,000 Purchased in-process technology 0 ---------- ---------- ----------- ---------- Total costs and expenses 2,851,000 182,000 3,033,000 ---------- ---------- ----------- ---------- Operating loss (725,000) (182,000) (907,000) Interest income 6,000 2,000 8,000 Interest expense (38,000) (38,000) ---------- ---------- ----------- ---------- Net loss ($757,000) ($180,000) $0 ($937,000) ========== ========== =========== ========== Net loss per OXIS share ($0.08) ($0.08) ========== ==========
29 Notes to Unaudited Pro Forma Statement of Operations for the Three Months Ended March 31, 1995 1. The write off of the pro forma purchase price amount allocated to technology on in-process products is not reflected in the unaudited pro forma statement of operations. This amount relates to research and development in process for which there is no alternative future use and is expected to approximate $3,081,000. This amount will be written off in the initial period of operations of the combined companies. 2. Net loss per OXIS share in the unaudited pro forma statement of operations has been computed based upon 12,124,423 Common Shares outstanding upon consummation of the acquisition. 30 -----END PRIVACY-ENHANCED MESSAGE-----