Attached files
| file | filename |
|---|---|
| 8-K - CURRENT REPORT - NAVIDEA BIOPHARMACEUTICALS, INC. | v232973_8-k.htm |
| EX-99.1 - EXHIBIT 99.1 - NAVIDEA BIOPHARMACEUTICALS, INC. | v232973_ex99-1.htm |
EXHIBIT 99.2
NEOPROBE CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
The following unaudited pro forma consolidated balance sheet and the unaudited pro forma consolidated statements of operations are derived from the historical consolidated financial statements of Neoprobe and give effect to the sale of the GDS Business to Devicor, the receipt of the net proceeds from the Asset Sale and the assumptions and adjustments described in the accompanying notes to the unaudited pro forma consolidated financial statements.
Pro forma financial information is intended to provide investors with information about the continuing impact of a transaction by showing how a specific transaction might have affected historical financial statements, illustrating the scope of the change in the historical financial position and results of operations. The adjustments made to historical information give effect to events that are directly attributable to the Asset Sale, factually supportable, and expected to have a continuing impact.
The unaudited pro forma consolidated financial statements consist of:
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·
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Unaudited Pro Forma Consolidated Balance Sheet – as of June 30, 2011
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Unaudited Pro Forma Consolidated Statements of Operations – six months ended June 30, 2011 and 2010
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·
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Unaudited Pro Forma Consolidated Statements of Operations – years ended December 31, 2010, 2009 and 2008
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The unaudited pro forma consolidated financial statements have been prepared giving effect to the Asset Sale as if it had occurred as of June 30, 2011 for the unaudited pro forma consolidated balance sheet and as of January 1, 2008 for the unaudited pro forma consolidated statements of operations.
These unaudited pro forma consolidated financial statements should be read in conjunction with the historical audited consolidated financial statements and the notes thereto included in Neoprobe’s Annual Report on Form 10-K for the year ended December 31, 2010 and Quarterly Report on Form 10-Q for the six months ended June 30, 2011, as filed with the SEC, which are incorporated herein by reference, and with the unaudited annual financial statements of the GDS Business for the years ended December 31, 2010, 2009 and 2008 included herein.
The unaudited pro forma consolidated financial statements are prepared in accordance with Article 11 of Regulation S-X. The pro forma adjustments are described in the accompanying notes and are based upon information and assumptions available at the time of the filing of this proxy statement.
We did not account for the GDS Business as, and it was not operated as, a separate, stand-alone entity, subsidiary or division of Neoprobe for the periods presented. The unaudited pro forma consolidated financial statements do not purport to represent, and are not necessarily indicative of, what our actual financial position and results of operations would have been had the Asset Sale occurred on the dates indicated. In addition, the unaudited pro forma consolidated financial statements should not be considered to be fully indicative of our future financial performance.
NEOPROBE CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
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Pro Forma Adjustments
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|||||||||||||||||
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June 30, 2011 Actual
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June 30,
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||||||||||||||||
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ASSETS
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Neoprobe
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GDS Business
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Asset Sale
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2011
Pro Forma
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|||||||||||||
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Current assets:
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|||||||||||||||||
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Cash
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$ | 7,544,395 | $ | -- | $ | 27,200,000 |
(a)
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$ | 34,744,395 | ||||||||
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Accounts receivable, net
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2,032,933 | 2,026,798 | -- | 6,135 | |||||||||||||
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Inventory, net
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1,642,095 | 797,892 | -- | 844,203 | |||||||||||||
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Prepaid expenses and other
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160,252 | 34,396 | -- | 125,856 | |||||||||||||
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Total current assets
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11,379,675 | 2,859,086 | 35,720,589 | ||||||||||||||
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Property and equipment
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2,459,225 | 1,023,396 | -- | 1,435,829 | |||||||||||||
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Less accumulated depreciation
and amortization
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1,952,850 | 927,845 | -- | 1,025,005 | |||||||||||||
| 506,375 | 95,551 | 410,824 | |||||||||||||||
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Patents and trademarks
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544,599 | 502,014 | -- | 42,585 | |||||||||||||
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Less accumulated amortization
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450,758 | 429,587 | -- | 21,171 | |||||||||||||
| 93,841 | 72,427 | 21,414 | |||||||||||||||
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Other assets
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7,421 | -- | -- | 7,421 | |||||||||||||
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Total assets
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$ | 11,987,312 | $ | 3,027,064 | $ | 36,160,248 | |||||||||||
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LIABILITIES AND
STOCKHOLDERS’ EQUITY
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|||||||||||||||||
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Current liabilities:
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|||||||||||||||||
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Accounts payable
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$ | 1,578,508 | $ | 665,793 | $ | (86,958 | ) |
(b)
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$ | 825,757 | |||||||
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Accrued liabilities and other
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2,663,246 | 134,209 | (533,333 | ) |
(b)
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1,995,704 | |||||||||||
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Notes payable to finance companies
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9,072 | -- | -- | 9,072 | |||||||||||||
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Deferred revenue, current portion
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735,954 | 735,954 | -- | -- | |||||||||||||
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Total current liabilities
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4,986,780 | 1,535,956 | 2,830,532 | ||||||||||||||
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Deferred revenue
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841,074 | 841,074 | -- | -- | |||||||||||||
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Derivative liabilities
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60,218 | -- | -- | 60,218 | |||||||||||||
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Other liabilities
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21,843 | -- | -- | 21,843 | |||||||||||||
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Total liabilities
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5,909,915 | 2,377,030 | 2,912,593 | ||||||||||||||
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Stockholders’ equity:
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|||||||||||||||||
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Preferred stock
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10 | -- | 10 | ||||||||||||||
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Common stock
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94,538 | -- | 94,538 | ||||||||||||||
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Additional paid-in capital
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263,514,167 | -- | 263,514,167 | ||||||||||||||
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Accumulated deficit
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(257,531,318 | ) | 27,170,257 |
(c)
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(230,361,061 | ) | |||||||||||
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Total stockholders’ equity
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6,077,397 | 33,247,654 | |||||||||||||||
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Total liabilities and
stockholders’ equity
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$ | 11,987,312 | $ | 36,160,248 | |||||||||||||
The accompanying notes are an integral part of these unaudited pro forma consolidated financial statements.
2
NEOPROBE CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
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Pro Forma Adjustments
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Six | ||||||||||||||||
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Three Months Ended
June 30, 2011 Actual
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Months
Ended
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GDS
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June 30, 2011
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Neoprobe
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Business
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Asset Sale
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Pro Forma
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Revenues:
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Net sales
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$ | 5,642,974 | $ | 5,642,974 | $ | - | $ | - | |||||||||
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License and other revenue
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392,097 | 50,000 | -- | 342,097 | |||||||||||||
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Total revenues
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6,035,071 | 5,692,974 | -- | 342,097 | |||||||||||||
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Cost of goods sold
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1,758,963 | 1,758,963 | -- | -- | |||||||||||||
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Gross profit
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4,276,108 | 3,934,011 | -- | 342,097 | |||||||||||||
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Operating expenses:
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Research and development
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4,553,428 | 341,299 | -- | 4,212,129 | |||||||||||||
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Selling, general and administrative
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5,379,205 | 248,901 | -- | 5,130,304 | |||||||||||||
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Total operating expenses
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9,932,633 | 590,200 | -- | 9,342,433 | |||||||||||||
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(Loss) income from operations
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(5,656,525 | ) | 3,343,811 | -- | (9,000,336 | ) | |||||||||||
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Other expense, net
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(961,400 | ) | -- | -- | (961,400 | ) | |||||||||||
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(Loss) income from continuing
operations before income tax
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(6,617,925 | ) | 3,343,811 | -- | (9,961,736 | ) | |||||||||||
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Provision for income tax
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-- | 1,136,896 | 1,136,896 |
(d)
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-- | ||||||||||||
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Net (loss) income from continuing
operations
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(6,617,925 | ) | 2,206,916 | (1,136,896 | ) | (9,961,736 | ) | ||||||||||
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Preferred stock dividends
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(50,000 | ) | -- | -- | (50,000 | ) | |||||||||||
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Net (loss) income from continuing
operations attributable to
common stockholders
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$ | (6,667,925 | ) | $ | 2,206,916 | $ | (1,136,896 | ) | $ | (10,011,736 | ) | ||||||
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Loss per share from continuing
operations:
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Basic and diluted
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$ | (0.08 | ) | $ | (0.11 | ) | |||||||||||
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Weighted average shares outstanding:
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|||||||||||||||||
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Basic and diluted
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87,549,776 | 87,549,776 | |||||||||||||||
The accompanying notes are an integral part of these unaudited pro forma consolidated financial statements.
3
NEOPROBE CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
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Pro Forma Adjustments
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Six
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Three Months Ended
June 30, 2010 Actual
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Months
Ended
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GDS
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June 30, 2010
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Neoprobe
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Business
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Asset Sale
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Pro Forma
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Revenues:
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Net sales
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$ | 5,171,748 | $ | 5,171,748 | $ | -- | $ | -- | |||||||||
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License and other revenue
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50,000 | 50,000 | -- | -- | |||||||||||||
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Total revenues
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5,221,748 | 5,221,748 | -- | -- | |||||||||||||
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Cost of goods sold
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1,700,621 | 1,700,621 | -- | -- | |||||||||||||
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Gross profit
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3,521,127 | 3,521,127 | -- | -- | |||||||||||||
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Operating expenses:
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Research and development
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4,139,173 | 208,044 | -- | 3,931,129 | |||||||||||||
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Selling, general and administrative
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2,046,544 | 230,170 | -- | 1,816,374 | |||||||||||||
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Total operating expenses
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6,185,717 | 438,214 | -- | 5,747,503 | |||||||||||||
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(Loss) income from operations
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(2,664,590 | ) | 3,082,913 | -- | (5,747,503 | ) | |||||||||||
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Other expense, net
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(42,852,793 | ) | -- | -- | (42,852,793 | ) | |||||||||||
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(Loss) income from continuing
operations before income tax
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(45,517,383 | ) | 3,082,913 | -- | (48,600,296 | ) | |||||||||||
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Provision for income tax
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-- | 1,048,190 | 1,048,190 |
(d)
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-- | ||||||||||||
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Net (loss) income from continuing
operations
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(45,517,383 | ) | 2,034,723 | (1,048,190 | ) | (48,600,296 | ) | ||||||||||
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Preferred stock dividends
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(8,156,745 | ) | -- | -- | (8,156,745 | ) | |||||||||||
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Net (loss) income from continuing
operations attributable to
common stockholders
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$ | (53,674,128 | ) | $ | 2,034,723 | $ | (1,048,190 | ) | $ | (56,757,041 | ) | ||||||
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Loss per share from continuing
operations:
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Basic and diluted
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$ | (0.67 | ) | $ | (0.71 | ) | |||||||||||
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Weighted average shares outstanding:
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|||||||||||||||||
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Basic and diluted
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79,917,641 | 79,917,641 | |||||||||||||||
The accompanying notes are an integral part of these unaudited pro forma consolidated financial statements.
4
NEOPROBE CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
|
Pro Forma Adjustments
|
|||||||||||||||||
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Year Ended
December 31, 2010 Actual
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Year Ended
December 31,
|
||||||||||||||||
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GDS
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2010
|
||||||||||||||||
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Neoprobe
|
Business
|
Asset Sale
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Pro Forma
|
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Revenues:
|
|||||||||||||||||
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Net sales
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$ | 9,983,174 | $ | 9,983,174 | $ | -- | $ | -- | |||||||||
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License and other revenue
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717,392 | 100,000 | -- | 617,392 | |||||||||||||
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Total revenues
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10,700,566 | 10,083,174 | -- | 617,392 | |||||||||||||
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Cost of goods sold
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3,206,709 | 3,206,709 | -- | -- | |||||||||||||
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Gross profit
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7,493,857 | 6,876,465 | -- | 617,392 | |||||||||||||
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Operating expenses:
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|||||||||||||||||
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Research and development
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9,221,421 | 417,999 | -- | 8,803,422 | |||||||||||||
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Selling, general and administrative
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4,583,503 | 427,815 | -- | 4,155,688 | |||||||||||||
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Total operating expenses
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13,804,924 | 845,814 | -- | 12,959,110 | |||||||||||||
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(Loss) income from operations
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(6,311,067 | ) | 6,030,651 | -- | (12,341,718 | ) | |||||||||||
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Other expense, net
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(43,567,204 | ) | -- | -- | (43,567,204 | ) | |||||||||||
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(Loss) income from continuing
operations before income tax
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(49,878,271 | ) | 6,030,651 | -- | (55,908,922 | ) | |||||||||||
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Provision for income tax
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-- | 2,412,260 | 2,412,260 |
(d)
|
-- | ||||||||||||
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Net (loss) income from continuing
operations
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(49,878,271 | ) | 3,618,391 | 2,102,312 | (55,908,922 | ) | |||||||||||
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Preferred stock dividends
|
(8,206,745 | ) | -- | -- | (8,206,745 | ) | |||||||||||
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Net (loss) income from continuing
operations attributable to
common stockholders
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$ | (58,085,016 | ) | $ | 3,618,391 | $ | 2,412,260 | $ | (64,115,667 | ) | |||||||
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Loss per share from continuing
operations:
|
|||||||||||||||||
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Basic and diluted
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$ | (0.72 | ) | $ | (0.79 | ) | |||||||||||
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Weighted average shares outstanding:
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|||||||||||||||||
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Basic and diluted
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80,726,498 | 80,726,498 | |||||||||||||||
The accompanying notes are an integral part of these unaudited pro forma consolidated financial statements.
5
NEOPROBE CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
|
Pro Forma Adjustments
|
|||||||||||||||||
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Year Ended
December 31, 2009 Actual
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Year Ended
December 31,
|
||||||||||||||||
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GDS
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2009
|
||||||||||||||||
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Neoprobe
|
Business
|
Asset Sale
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Pro Forma
|
||||||||||||||
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Revenues:
|
|||||||||||||||||
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Net sales
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$ | 9,418,032 | $ | 9,418,032 | $ | -- | $ | -- | |||||||||
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License and other revenue
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100,000 | 100,000 | -- | -- | |||||||||||||
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Total revenues
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9,518,032 | 9,518,032 | -- | -- | |||||||||||||
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Cost of goods sold
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3,134,740 | 3,134,740 | -- | -- | |||||||||||||
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Gross profit
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6,383,292 | 6,383,292 | -- | -- | |||||||||||||
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Operating expenses:
|
|||||||||||||||||
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Research and development
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4,967,861 | 736,064 | -- | 4,231,797 | |||||||||||||
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Selling, general and administrative
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3,240,337 | 391,449 | -- | 2,848,888 | |||||||||||||
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Total operating expenses
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8,208,198 | 1,127,513 | -- | 7,080,685 | |||||||||||||
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(Loss) income from operations
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(1,824,906 | ) | 5,255,779 | -- | (7,080,685 | ) | |||||||||||
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Other expense, net
|
(35,890,586 | ) | -- | -- | (35,890,586 | ) | |||||||||||
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(Loss) income from continuing
operations before income tax
|
(37,715,492 | ) | 5,255,779 | -- | (42,971,271 | ) | |||||||||||
|
Provision for income tax
|
-- | 2,102,312 | 2,102,312 |
(d)
|
-- | ||||||||||||
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Net (loss) income from continuing
operations
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(37,715,492 | ) | 3,153,467 | 2,102,312 | (42,971,271 | ) | |||||||||||
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Preferred stock dividends
|
(240,000 | ) | -- | -- | (240,000 | ) | |||||||||||
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Net (loss) income from continuing
operations attributable to
common stockholders
|
$ | (37,955,492 | ) | $ | 3,153,467 | 2,102,312 | $ | (43,211,271 | ) | ||||||||
|
Loss per share from continuing
operations:
|
|||||||||||||||||
|
Basic and diluted
|
$ | (0.51 | ) | $ | (0.59 | ) | |||||||||||
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Weighted average shares outstanding:
|
|||||||||||||||||
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Basic and diluted
|
73,771,871 | 73,771,871 | |||||||||||||||
The accompanying notes are an integral part of these unaudited pro forma consolidated financial statements.
6
NEOPROBE CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
|
Pro Forma Adjustments
|
|||||||||||||||||
|
Year Ended
December 31, 2008 Actual
|
Year Ended
December 31,
|
||||||||||||||||
|
GDS
|
2008
|
||||||||||||||||
|
Neoprobe
|
Business
|
Asset Sale
|
Pro Forma
|
||||||||||||||
|
Revenues:
|
|||||||||||||||||
|
Net sales
|
$ | 7,417,751 | $ | 7,417,751 | $ | -- | $ | -- | |||||||||
|
License and other revenue
|
171,750 | 171,750 | -- | -- | |||||||||||||
|
Total revenues
|
7,589,501 | 7,589,501 | -- | -- | |||||||||||||
|
Cost of goods sold
|
2,845,498 | 2,845,498 | -- | -- | |||||||||||||
|
Gross profit
|
4,744,003 | 4,744,003 | -- | -- | |||||||||||||
|
Operating expenses:
|
|||||||||||||||||
|
Research and development
|
4,286,474 | 648,515 | -- | 3,637,959 | |||||||||||||
|
Selling, general and administrative
|
2,965,342 | 243,734 | -- | 2,721,608 | |||||||||||||
|
Total operating expenses
|
7,251,816 | 892,249 | -- | 6,359,567 | |||||||||||||
|
(Loss) income from operations
|
(2,507,813 | ) | 3,851,754 | -- | (6,359,567 | ) | |||||||||||
|
Other expense, net
|
(2,124,090 | ) | -- | -- | (2,124,090 | ) | |||||||||||
|
(Loss) income from continuing
operations before taxes
|
(4,631,903 | ) | 3,851,754 | -- | (8,483,657 | ) | |||||||||||
|
Provision for income tax
|
-- | 1,540,702 | 1,540,702 |
(d)
|
-- | ||||||||||||
|
Net (loss) income from continuing
operations
|
$ | (4,631,903 | ) | $ | 2,311,052 | $ | 1,540,702 | $ | (8,483,657 | ) | |||||||
|
Loss per share from continuing operations:
|
|||||||||||||||||
|
Basic and diluted
|
$ | (0.07 | ) | $ | (0.12 | ) | |||||||||||
|
Weighted average shares outstanding:
|
|||||||||||||||||
|
Basic and diluted
|
68,594,172 | 68,594,172 | |||||||||||||||
The accompanying notes are an integral part of these unaudited pro forma consolidated financial statements.
7
NEOPROBE CORPORATION AND SUBSIDIARIES
NOTES TO THE UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL INFORMATION
|
1.
|
Basis of Presentation
|
Pro forma information is intended to reflect the impact of the Asset Sale on Neoprobe’s historical financial position and results of operations through adjustments that are directly attributable to the Asset Sale, that are factually supportable and that are expected to have continuing impact. In order to accomplish this, we have eliminated the unaudited financial statements of the GDS Business of Neoprobe as presented earlier in this proxy statement from the Neoprobe Corporation historical financial statements. This pro forma information attempts to represent the financial position and results of operations of Neoprobe’s Remaining Businesses. However, we did not account for the GDS Business as, and it was not operated as, a separate, stand-alone entity, subsidiary or division of Neoprobe for the periods presented. The unaudited pro forma consolidated financial statements do not purport to represent, and are not necessarily indicative of, what our actual financial position and results of operations would have been had the Asset Sale occurred on the dates indicated. In addition, the unaudited pro forma consolidated financial statements should not be considered to be fully indicative of our future financial performance.
These unaudited pro forma consolidated financial statements reflect all adjustments that, in the opinion of management, are necessary to present fairly the pro forma financial position and results of operations.
In the preparation of the pro forma consolidated balance sheet, the assumption was made that the assets were sold and liabilities were assumed by Devicor pursuant to the Asset Purchase Agreement on June 30, 2011. In the preparation of the pro forma consolidated statements of operations, the assumption was made that the Asset Sale took place on January 1, 2008.
|
1.
|
Pro Forma Adjustments
|
The pro forma adjustments to the balance sheet and statements of operations include:
|
|
(a)
|
This amount reflects estimated net cash proceeds to be received related to the sale of the GDS Business to Devicor. The sale price was $30.0 million, and we expect to incur approximately $2.8 million in costs and expenses related to the transaction. Of the $2.8 million in costs and expenses, $2.55 million is payable for financial advisory services and $272,000 is payable for legal and other costs. The cash proceeds amount does not include any of the $20.0 million in potential future royalties, nor does it include any adjustment for net working capital at closing. Pursuant to the Asset Purchase Agreement, if the net working capital balance at the time of closing exceeds the target amount of net working capital as set forth in the Asset Purchase Agreement, then the purchase price will be adjusted upward in an amount equal to the excess, and if the net working capital balance at the time of closing is less than the target amount, then the purchase price will be adjusted downward in an amount equal to the deficiency.
|
|
|
(b)
|
This amount reflects payment of invoices included in accounts payable and accruals included in accrued liabilities at June 30, 2011 that are assumed to be paid as part of the $2.8 million in costs and expenses related to the transaction.
|
|
|
(c)
|
This amount represents the excess of the net cash proceeds of the sale over the net book value of the assets and liabilities being sold to Devicor, adjusted for amounts in accounts payable and accrued liabilities that are assumed to be paid as part of the $2.8 million in costs and expenses related to the transaction. The Asset Sale is expected to be subject to some amount of Federal, state and local income tax. However, this pro forma adjustment assumes that no income taxes are payable on the Asset Sale as the majority of the gain is expected to be offset by net operating loss carryforwards.
|
|
|
(d)
|
This amount represents the offset of the estimated GDS Business stand-alone tax provision which would have been payable if the GDS Business were a stand-alone company.
|
8
The pro forma adjustments to the statements of operations do not include the following revenues and expenses:
|
|
·
|
Royalty payments that Neoprobe would be entitled to receive upon the achievement of GDS product sales revenues through 2017 in excess of baseline sales levels as outlined in the Asset Purchase Agreement.
|
|
|
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Expenses related to (a) the termination of the Business Employees, including the payout of accrued but unused paid time off of $38,000 and the vesting of unvested stock options of $94,000 upon the closing of the Asset Sale, and (b) the Asset Sale of $2.8 million, as such expenses would not be recurring.
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