Attached files
Boston Therapeutics, Inc. |
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(formerly Avanyx Therapeutics, Inc.) |
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(A Development Stage Company) |
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Unaudited Pro Forma Consolidated Balance Sheet |
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As of September 30, 2010 |
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Historical |
Historical |
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Boston Therapeutics, |
Boston Therapeutics, |
Pro Forma |
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Inc. (Formerly Avanyx |
Inc. |
Adjustments |
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Pro Forma |
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Therapeutics, Inc.) |
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(See Note 2) |
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Combined |
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ASSETS |
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Cash |
$ 30,149 |
$ 11,460 |
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$ 41,609 |
Accounts Receivable |
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760 |
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760 |
Prepaid Expenses |
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3,500 |
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3,500 |
Inventory |
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4,609 |
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4,609 |
Total current assets |
30,149 |
20,329 |
- |
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50,478 |
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Intangible assets |
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900,000 |
a) |
900,000 |
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Goodwill |
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66,707 |
b) |
66,707 |
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Total assets |
$ 30,149 |
$ 20,329 |
$ 966,707 |
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$1,017,185 |
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LIABILITIES AND STOCKHOLDERS' DEFICIT |
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Current liabilities: |
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Accounts payable |
$ 56,561 |
$ 4,550 |
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$ 61,111 |
Accrued expenses |
132,066 |
43,498 |
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175,564 |
Advances - related party |
117,820 |
60,000 |
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177,820 |
Total current liabilities |
306,447 |
108,048 |
- |
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414,495 |
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Total liabilities |
306,447 |
108,048 |
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414,495 |
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Stockholders deficit: |
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Preferred stock |
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- |
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- |
Common stock |
10,031 |
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4,000 |
c) |
14,031 |
Additional paid-in capital |
21,205 |
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874,988 |
c) |
896,193 |
Deficit accumulated during the development stage |
(307,534) |
(87,719) |
87,719 |
d) |
(307,534) |
Total stockholders deficit |
(276,298) |
(87,719) |
966,707 |
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602,690 |
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Total liabilities and stockholders deficit |
$ 30,149 |
$ 20,329 |
$ 966,707 |
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$ 1,017,185 |
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See Accompanying Notes to the Unaudited Pro forma Consolidated Financial Information
Boston Therapeutics, Inc. |
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(formerly Avanyx Therapeutics, Inc.) |
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(A Development Stage Company) |
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Unaudited Pro Forma Consolidated Statement of Operations |
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For the Period from Inception (June 15, 2009) to December 31, 2009 | ||
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Historical |
Historical |
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Boston Therapeutics, |
Boston Therapeutics, |
Pro Forma |
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Inc. (Formerly Avanyx |
Inc. |
Adjustments |
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Pro Forma |
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Therapeutics, Inc.) |
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(See Note 2) |
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Combined |
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Operating expenses: |
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Research and development |
$ - |
$ 4,245 |
30,000 |
e) |
$ 34,245 |
Sales and marketing |
- |
181 |
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181 |
General and administrative |
136,894 |
36,244 |
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173,138 |
Total operating expenses |
136,894 |
40,670 |
30,000 |
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207,564 |
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Interest expense-related party |
927 |
155 |
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1,082 |
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Net loss |
$ (137,821) |
$ (40,825) |
$ (30,000) |
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$(208,646) |
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Net loss per share - basic and diluted |
$ (0.01) |
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$ (0.02) |
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Weighted average shares outstanding - |
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basic and diluted |
9,736,842 |
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4,000,000 |
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13,736,842 |
See Accompanying Notes to the Unaudited Pro forma Consolidated Financial Information
Boston Therapeutics, Inc. |
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(formerly Avanyx Therapeutics, Inc.) |
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(A Development Stage Company) |
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Unaudited Pro Forma Consolidated Statement of Operations |
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For the nine month period ended September 30, 2010 | |
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Historical |
Historical |
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Boston Therapeutics, |
Boston Therapeutics, |
Pro Forma |
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Inc. (Formerly Avanyx |
Inc. |
Adjustments |
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Pro Forma |
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Therapeutics, Inc.) |
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(See Note 2) |
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Combined |
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Revenue |
$ - |
$ 2,700 |
$ - |
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$ 2,700 |
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Cost of goods sold |
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2,743 |
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2,743 |
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Gross margin |
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(43) |
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(43) |
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Operating expenses: |
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Research and development |
- |
1,925 |
67,500 |
e) |
69,425 |
Sales and marketing |
- |
5,584 |
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5,584 |
General and administrative |
165,208 |
37,859 |
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203,067 |
Total operating expenses |
165,208 |
45,368 |
67,500 |
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278,076 |
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Interest expense-related party |
4,505 |
1,483 |
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5,988 |
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Net loss |
$ (169,713) |
$ (46,894) |
$(67,500) |
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$(284,107) |
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Net loss per share - basic and diluted |
$ (0.02) |
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$ (0.02) |
Weighted average shares outstanding |
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- basic and diluted |
10,020,569 |
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4,000,000 |
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14,020,569 |
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See Accompanying Notes to the Unaudited Pro forma Consolidated Financial Information
Notes to Unaudited Pro Forma Consolidated Financial Information
(1) Description of the Transaction
Pursuant to an Agreement and Plan of Merger dated November 10, 2010 (the Agreement), between Boston Therapeutics, Inc. formerly Avanyx Therapeutics, Inc. (the Company) and Boston Therapeutics, Inc. (BTI) , the Company issued 4,000,000 shares of its common stock to the stockholders of BTI in exchange for all the outstanding common stock of BTI. Under the terms of the agreement, BTI merged into the Company with the Company being the surviving entity and the Companys name was changed to Boston Therapeutics, Inc.
The Company is in the process of finalizing its valuation of the intangible assets and therefore the allocation of the purchase price is still subject to adjustment, and such adjustments could be material.
The total consideration of $878,988 consisted of 4,000,000 shares of the Company in exchange for all the issued and outstanding shares of BTI. The acquisition of BTI includes SUGARDOWNTM, a ready for market dietary supplement to reduce the sharp spikes in blood sugar associated with eating high carbohydrate foods. The following table summarizes the fair value assigned to the acquired assets and liabilities:
Cash $ 11,460
Accounts receivable 760
Inventory 4,609
Prepaid expense 3,500
Accounts payable and accrued expenses (48,048)
Note payable shareholder (60,000)
SUGARDOWNTM technology and provisional patent 900,000
Net assets acquired 812,281
Goodwill 66,707
Net fair value $ 878,988
(2) Pro Forma Adjustments
The following unaudited pro forma consolidated balance sheet as of September 30, 2010 includes the effect of the acquisition, as if the acquisition had occurred on September 30, 2010 for balance sheet purposes and is derived from and combines the Companys unaudited consolidated balance sheet as of September 30, 2010 with BTIs unaudited balance sheet as of September 30, 2010. The unaudited pro forma consolidated statement of operations for the nine months ended September 30, 2010 and for the period from inception to December 31, 2009 give effect to the acquisition as if it had been completed on the date of inception. The unaudited pro forma combined statement of operations for the nine months ended September 30, 2010 is derived from and combines the Companys unaudited consolidated statement of operations for the nine months ended September 30, 2010 with BTIs unaudited statement of income for the nine months ended September 30, 2010. The unaudited pro forma combined statement of operations for the period from inception to December 31, 2009 is derived from and combines the Companys unaudited consolidated statement of operations for the period from inception (August 24, 2009) to December 31, 2009 with BTIs unaudited combined statement of operations for the period from inception (June 15, 2009) to December 31, 2009. The historical financial information of the Company and BTI have been adjusted in the unaudited pro forma combined financial statements to give effect to pro forma events that are (1) directly attributable to the acquisition, (2) factually supportable and (3) with respect to the unaudited pro forma statements of operations, expected to have a continuing impact on the combined results.
The unaudited pro forma adjustments are based upon available information and certain assumptions that the Company believes are reasonable. The unaudited pro forma financial statements have been presented for informational purposes and should not be considered indicative of the financial position or results of operations that would have occurred if the acquisition had been consummated on the dates indicated nor should they be considered indicative of the future financial position or results of operations of the combined company.
The unaudited pro forma combined financial statements should be read in conjunction with:
the Companys separate historical audited consolidated financial statements and accompanying notes as of and for the year ended December 31, 2009 included in the Companys Form S-1/A filed with the SEC on October 8, 2010;
the Companys separate historical unaudited consolidated financial statements and accompanying notes as of and for the nine months ended September 30, 2010 included in the Companys Quarterly Report on Form 10-Q.
The pro forma consolidated financial information give effect to certain adjustments which include the following:
a) To record the fair value of the identifiable intangible assets (see note 1) The intangible assets include developed technology and provisional patents relating to the SUGARDOWNTM product. Since the company was under common ownership at the time of the acquisition, the fair value of the intangibles was recorded excluding the 10% owned by the Chief Executive Officer of the company.
b) To record the goodwill created by the excess of consideration given over the fair value of assets received and liabilities assumed of $11,807 and the assembled workforce acquired of $54,900.
c) To record the total consideration for the acquisition of BTI including the issuance of 4,000,000 shares of $0.001 par value common stock at fair value of $0.2466 per share.
d) To record the cancellation of the BTI equity prior to the acquisition
e) To record the intangible amortization as a result of the acquisition of purchased intangibles. The intangibles are being amortized on a straight line basis over a period of ten years, the period benefited by the acquisition of SUGARDOWNTM