EX-99.2 6 brhc10047564_ex99-2.htm EXHIBIT 99.2
Exhibit 99.2

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION

Sale of BioTrack

On February 10, 2023, Helix Technologies, Inc., a Delaware corporation (“Helix”) and a wholly owned subsidiary of Forian Inc. (the “Company”), completed the sale of 100% of the outstanding capital stock of its wholly owned subsidiary, Bio-Tech Medical Software, Inc., a Florida corporation (“BioTrack”), to BT Assets Group Inc., a Delaware corporation (“Buyer”) and a wholly owned subsidiary of Alleaves Inc., a Delaware corporation (“Alleaves”), pursuant to that certain Stock Purchase Agreement (the “Purchase Agreement”), dated February 10, 2023, by and among Helix, BioTrack and the Buyer (the “Transaction”).
 
The total consideration paid by the Buyer under the Purchase Agreement is $30 million in cash, subject to any working capital adjustments. The Buyer paid $20 million in cash at closing and is required to make twelve equal monthly cash payments totaling $10 million commencing March 2023, which subsequent payments are guaranteed by certain affiliates of the Buyer.
 
Unaudited Pro Forma Condensed Consolidated Financial Statements

The Transaction constitutes a significant disposition for the Company for purposes of Item 2.01 of Current Report on Form 8-K. As a result, the following unaudited pro forma condensed consolidated statements of operations for the nine months ended September 30, 2022 and for the year ended December 31, 2021 are presented as if the Transaction had occurred immediately prior to January 1, 2021. The following unaudited pro forma condensed consolidated balance sheet as of September 30, 2022 is presented as if the Transaction had occurred on September 30, 2022. The unaudited condensed consolidated pro forma financial statements are based on the historical financial statements prepared in accordance with U.S. generally accepted accounting principles and are presented based on information currently available. They are intended for informational purposes only and are not intended to represent the Company’s financial position or results of operations had the Transaction and related events occurred on the dates indicated, or to project the Company’s financial performance for any future period.

The following unaudited pro forma condensed consolidated financial statements have been prepared in accordance with Regulation S-X Article 11, Pro Forma Financial Information, as amended by the final rule, Amendments to Financial Disclosures About Acquired and Disposed Businesses, as adopted by the U.S. Securities and Exchange Commission on May 20, 2020, and should be read in conjunction with the following: (i) the accompanying notes to the unaudited pro forma condensed consolidated financial information; (ii) the audited consolidated financial statements and accompanying notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021; and (iii) the unaudited condensed consolidated financial statements and accompanying notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the Company’s Quarterly Report on Form 10-Q for the nine months ended September 30, 2022.

The unaudited pro forma condensed consolidated financial information is presented based on assumptions, adjustments and currently available information described in the accompanying notes and is intended for informational purposes only. The unaudited pro forma condensed consolidated financial information is not necessarily indicative of what the Company’s results of operations or financial condition would have been had the divestiture been completed on the dates assumed. In addition, it is not necessarily indicative of the Company’s future results of operations or financial condition

FORIAN INC.
UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEET
AS OF SEPTEMBER 30, 2022

   
Historical
    
Balances
Attributable to
BioTrack (a)
    
Pro Forma Adjustments
  
 
  
Pro-Forma Condensed
  
ASSETS
                          
Current assets:
                          
Cash and cash equivalents
  
$
1,585,594
    
$
(865,610
)
  
$
19,702,000
  
 (b)
  
$
20,421,984
  
Marketable securities
    
19,046,961
      
—
                
19,046,961
  
Accounts receivable, net
    
3,553,323
      
(571,987
)
              
2,981,336
  
Contract assets
    
1,978,181
      
—
                
1,978,181
  
Prepaid expenses
    
1,205,630
      
(175,492
)
              
1,030,138
  
Proceeds receivable from sale of BioTrack
    
—
      
—
      
9,590,000
  
 (c)
    
9,590,000
  
Other assets
    
436,101
      
(7,471
)
              
428,630
  
Total current assets
    
27,805,790
      
(1,620,560
)
    
29,292,000
  
 
    
55,477,230
  
 
                                  
Property and equipment, net
    
2,870,667
      
(2,731,259
)
              
139,408
  
Intangible assets, net
    
7,344,677
      
(7,344,677
)
              
—
  
Goodwill
    
9,099,372
      
(9,099,372
)
              
0
  
Right of use assets, net
    
706,272
      
(668,615
)
              
37,657
  
Deposits and other assets
    
274,532
      
—
          
 
    
274,532
  
Total assets
   $
48,101,310
    
$
(21,464,483
)
  
$
29,292,000
  
 
  
$
55,928,827
  
                         
 
        
LIABILITIES AND STOCKHOLDERS’ EQUITY
                                  
                                   
Current liabilities:
                                  
Accounts payable
    
896,916
      
(210,123
)
              
686,793
  
Accrued expenses
    
4,557,385
      
(479,278
)
    
2,678,697
  
 (f)
    
6,756,804
  
Short-term operating lease liabilities
    
265,474
      
(244,365
)
              
21,109
  
Warrant liability
    
26,079
      
—
                
26,079
  
Deferred revenues
    
2,685,027
      
(537,825
)
        
 
    
2,147,202
  
Total current liabilities
    
8,430,881
      
(1,471,591
)
    
2,678,697
  
 
    
9,637,987
  
 
                                  
Long-term liabilities:
                                  
Long-term operating lease liabilities
    
444,996
      
(428,448
)
              
16,548
  
Convertible notes payable, net of debt issuance costs ($6,000,000 in principal is held by a related party.)
    
24,893,488
      
—
          
 
    
24,893,488
  
Total long-term liabilities
    
25,338,484
      
(428,448
)
    
—
  
 
    
24,910,036
  
                                   
Total liabilities
    
33,769,365
      
(1,900,039
)
    
2,678,697
  
 
    
34,548,023
  
                         
 
        
Commitments and contingencies
                                  
Stockholders’ equity:
                                  
Parent Investment in Subsidiary
            
(19,564,444
)
    
19,564,444
        
—
  
Preferred Stock; par value $0.001; 5,000,000 Shares authorized; 0 issued and outstanding as of September 30, 2022 and December 31, 2021
    
—
      
—
                
—
  
Common Stock; par value $0.001; 95,000,000 Shares authorized; 32,138,000 issued and outstanding as of September 30, 2022 and 31,773,154 issued and outstanding as of December 31, 2021
    
32,138
      
—
                
32,138
  
Additional paid-in capital
    
69,535,194
      
—
                
69,535,194
  
Accumulated deficit
    
(55,235,387
 )
   
—
      
7,048,859
  
 
    
(48,186,528
)
Total stockholders’ equity
    
14,331,945
      
(19,564,444
)
    
26,613,303
  
 
    
21,380,804
  
Total liabilities and stockholders’ equity
   $
48,101,310
    
$
(21,464,483
)
  
$
29,292,000
  
 
  
$
55,928,827
  

FORIAN INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2022

   
Historical
    
Proforma
adjustments
attributable to
BioTrack (a)
    
Pro Forma
  
Revenues:
                  
Information and Software
  
$
18,674,213
    
$
(7,225,745
)
  
$
11,448,468
  
Services
    
1,168,034
      
(1,168,034
)
    
—
  
Other
    
259,618
      
-
      
259,618
  
Total revenues
    
20,101,865
      
(8,393,779
)
    
11,708,086
  
                         
Costs and Expenses:
                        
Cost of revenues
    
5,154,353
      
(4,246,138
)
    
908,215
  
Operating Expenses
    
29,943,274
      
(6,985,189
)
    
22,958,085
  
Separation expenses
    
5,611,857
      
—
      
5,611,857
  
Gain on sale of businesses
    
(202,159
)
    
—
      
(202,159
)
Depreciation and amortization
    
2,052,729
      
(1,992,561
)
    
60,168
  
Transaction related expenses
    
—
      
—
      
—
  
Total costs and expenses
    
42,560,054
      
(13,223,888
)
    
29,336,166
  
                         
Loss From Operations
    
(22,458,189
)
    
4,830,109
      
(17,628,080
)
                         
Other Income (Expense):
                        
Change in fair value of warrant liability
    
343,155
      
—
      
343,155
  
Interest and investment income
    
112,602
      
(916
)
    
111,686
  
Interest expense
    
(659,425
)
    
—
      
(659,425
)
Foreign currency related gains (losses)
    
266,600
      
—
      
266,600
  
Total other income (expense), net
    
62,932
      
(916
)
    
62,016
  
                         
Net loss before income taxes
    
(22,395,257
)
    
4,829,194
      
(17,566,063
)
Income tax expense
    
(20,000
)
            
(20,000
)
                         
Net Loss
   $
(22,415,257
 )
 
$
4,829,194
     $
(17,586,063
 )
                         
Basic and diluted net loss per common share
  
$
(0.70
)
  
$
0.15
    
$
(0.55
)
Weighted-average shares outstanding:
    
31,978,719
      
31,978,719
      
31,978,719
  

FORIAN INC.
UNAUDITED CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2021

   
Historical
    
Proforma
adjustments
attributable to
BioTrack (a)
    
Pro Forma
  
Revenues:
                  
Information and Software
  
$
14,952,247
    
$
(7,813,337
)
  
$
7,138,910
  
Services
    
1,122,528
      
(1,122,528
)
    
—
  
Other
    
804,940
      
-
      
804,940
  
Total revenues
    
16,879,715
      
(8,935,865
)
    
7,943,850
  
                         
Costs and Expenses:
                        
Cost of revenues
    
4,717,175
      
(3,777,817
)
    
939,358
  
Operating Expenses
    
36,582,202
      
(5,783,838
)
    
30,798,364
  
Separation expenses
                    
—
  
Gain on sale of businesses
                    
—
  
Depreciation and amortization
    
1,986,816
      
(1,918,547
)
    
68,269
  
Transaction related expenses
    
1,210,279
      
—
      
1,210,279
  
Total costs and expenses
    
44,496,472
      
(11,480,202
)
    
33,016,270
  
                         
Loss From Operations
    
(27,616,757
)
    
2,544,336
      
(25,072,421
)
                         
Other Income (Expense):
                        
Change in fair value of warrant liability
    
878,481
              
878,481
  
Interest and investment income
    
6,809
      
(487
)
    
6,322
  
Interest expense
    
(322,379
)
            
(322,379
)
Foreign currency related gains (losses)
    
525,252
              
525,252
  
Total other income (expense), net
    
1,088,163
      
(487
)
    
1,087,676
  
                         
Net loss before income taxes
    
(26,528,594
)
    
2,543,849
      
(23,984,745
)
Income tax expense
    
(22,511
)
    
—
      
(22,511
)
                         
Net Loss
   $
(26,551,105
 )
 
$
2,543,849
     $
(24,007,256
 )
                         
Basic and diluted net loss per common share
  
$
(0.90
)
  
$
0.09
    
$
(0.81
)
Weighted-average shares outstanding:
    
29,527,608
      
29,527,609
      
29,527,609
  

FORIAN INC.
 
NOTES TO UNAUDITED CONSOLIDATED CONDENSED FINANCIAL INFORMATION
 

 1.
Basis of Presentation

The pro forma condensed consolidated financial statements included herein have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (the “SEC”). The unaudited pro forma condensed consolidated financial information has been derived from the historical consolidated financial statements and accounting records of the Company. The unaudited pro forma condensed consolidated balance sheet at September 30, 2022 was prepared as if the  sale of Bio-Tech Medical Software, Inc. (“BioTrack”) had occurred on September 30, 2022. The unaudited pro forma condensed consolidated statements of operations for the nine months ended September 30, 2022 and for the year ended December 31, 2021 were prepared as if the sale of BioTrack had occurred on immediately prior to January 1, 2021. The unaudited pro forma condensed consolidated financial statements and underlying pro forma adjustments are based upon currently available information and include certain estimates and assumptions made by management; accordingly, actual results could differ materially from the pro forma information. Management believes the assumptions provide a reasonable and reliably determinable basis for presenting the significant effects of the sale of BioTrack. These unaudited pro forma condensed consolidated financial statements are provided for illustrative purposes only and may or may not provide an indication of results in the future.


 2.
Unaudited Pro Forma Condensed Consolidated Balance Sheet and Statement of Operations Adjustments

Pro Forma Adjustments Balance Sheet unaudited pro forma condensed combined financial information is prepared in accordance with Article 11 of SEC Regulation S-X. The historical financial information has been adjusted in the accompanying unaudited pro forma condensed combined financial information to give effect to unaudited pro forma events that are:

 
(a)
Represents amounts related to BioTrack for the periods presented.

  (b)-(f)
Represents the impacts of the sale of BioTrack as if it occurred on September 30, 2022 as shown in the table below. Income Taxes reflects the estimated tax liability attributable to the sale of BioTrack after the expected utilization of estimated available 2022 net operating losses and 2021 net operating loss carryforwards for federal and state tax purposes.

Pro Forma Gain on sale of BioTrack as if Transaction occurred on September 30, 2022           

          
Closing Payment
  
$
20,000,000
  
(b)
Deferred Payments, net of estimated discount of $410,000
    
9,590,000
  
(c)
Total Purchase Price
    
29,590,000
    
             
Estimated Transaction Expenses
    
(298,000
)
(b)
Net Book Value
    
(19,564,444
)
(d)
Pre Tax Gain
    
9,727,556
  
(e)
             
Income Taxes after utilization of net operating loss carryforwards
    
(2,678,697
)
(f)
             
Net Gain on Sale of BioTrack
  
$
7,048,859