Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - Diffusion Pharmaceuticals Inc. | stratus_8k-111813.htm |
| EX-10.3 - EXECUTIVE EMPLOYMENT AGREEMENT - Diffusion Pharmaceuticals Inc. | stratus_8k-ex1003.htm |
| EX-10.2 - EXECUTIVE EMPLOYMENT AGREEMENT - Diffusion Pharmaceuticals Inc. | stratus_8k-ex1002.htm |
| EX-10.6 - SUBLICENSE AGREEMENT - Diffusion Pharmaceuticals Inc. | stratus_8k-ex1006.htm |
| EX-10.10 - SERVICE AGREEMENT - Diffusion Pharmaceuticals Inc. | stratus_8k-ex1010.htm |
| EX-99.1 - AUDITED FINANCIAL STATEMENTS - Diffusion Pharmaceuticals Inc. | stratus_8k-ex9901.htm |
| EX-10.9 - MASTER CONTRACT SERVICES AGREEMENT - Diffusion Pharmaceuticals Inc. | stratus_8k-ex1009.htm |
| EX-10.8 - MASTER SERVICES AGREEMENT - Diffusion Pharmaceuticals Inc. | stratus_8k-ex1008.htm |
| EX-10.5 - EXCLUSIVE LICENSE AGREEMENT - Diffusion Pharmaceuticals Inc. | stratus_8k-ex1005.htm |
| EX-10.7 - COLLABORATION AGREEMENT - Diffusion Pharmaceuticals Inc. | stratus_8k-ex1007.htm |
| EX-10.4 - REGISTRATION RIGHTS AGREEMENT - Diffusion Pharmaceuticals Inc. | stratus_8k-ex1004.htm |
Exhibit 99.2
The following pro forma financial information has been prepared as if the Mergers (as defined in this Report on Form 8-K) occurred on: September 30, 2013 for the Pro Forma Statement of Financial Position, September 30, 2013 on page 2 of this Exhibit; on January 1, 2013 for the Pro Forma Statement of Income for the Nine Months Ended September 30, 2013 on page 3 of this Exhibit; and on January 1, 2012 for the Pro Forma Statement of Income for the Year Ended December 31, 2012 on page 4 of this Exhibit.
The information in these pro forma financials for Hygeia and Canterbury has been derived from the audited financial statements for the year ended December 31, 2012 and the unaudited financial statements for the nine months ended September 30, 2013. The information in these pro forma financials for Stratus has been derived from the audited financial statements for the year ended December 31, 2012 and the unaudited financial statements for the nine months ended September 30, 2013.
| 1 |
Stratus Media Group, Inc., Hygeia Therapeutics, Inc. and Canterbury Laboratories, LLC
Pro Forma Statement of Financial Position
September 30, 2013
| September 30, 2013 | ||||||||||||||||
| Stratus Media | Hygeia/ | Pro Forma | Pro Forma | |||||||||||||
| Group | Canterbury | Adjustments | Combined | |||||||||||||
| ASSETS | ||||||||||||||||
| Current assets | ||||||||||||||||
| Cash and equivalents | $ | 255,596 | $ | 129,672 | $ | – | $ | 385,268 | ||||||||
| Accounts receivable | 53,013 | 23,655 | – | 76,668 | ||||||||||||
| Prepaid expenses and deposits | 2,901,438 | – | – | 2,901,438 | ||||||||||||
| Total current assets | 3,210,047 | 153,327 | – | 3,363,374 | ||||||||||||
| Property and equipment, net | 24,461 | 7,446 | – | 31,907 | ||||||||||||
| Goodwill | 8,672,656 | (a) | 8,672,656 | |||||||||||||
| Intangible assets | – | 132,571 | 7,646,429 | (b) | 7,779,000 | |||||||||||
| Total assets | $ | 3,234,508 | $ | 293,344 | $ | 16,319,085 | $ | 19,846,937 | ||||||||
| LIABILITIES AND STOCKHOLDERS' DEFICIT | ||||||||||||||||
| Current liabilities | ||||||||||||||||
| Accounts payable | $ | 1,540,706 | $ | 291,647 | $ | – | $ | 1,832,353 | ||||||||
| Deferred salary | 1,425,365 | – | – | 1,425,365 | ||||||||||||
| Accrued interest | 207,593 | 20,267 | – | 227,860 | ||||||||||||
| Other accrued expenses and other liabilities | 2,350,011 | 73,974 | – | 2,423,985 | ||||||||||||
| Amounts payable to officers | 211,358 | 26,902 | – | 238,260 | ||||||||||||
| Advances from Stockholder/member | – | 62,814 | 62,814 | |||||||||||||
| Rent liability for facilities no longer occupied | 1,260,644 | – | – | 1,260,644 | ||||||||||||
| Notes payable | 2,575,002 | – | – | 2,575,002 | ||||||||||||
| Total current liabilities | 9,570,679 | 475,604 | – | 10,046,283 | ||||||||||||
| Long-term liabilities - convertible notes payable | – | 715,000 | – | 715,000 | ||||||||||||
| Deffered tax liability | – | – | 3,000,576 | (c) | 3,000,576 | |||||||||||
| Total long-term liabilities | – | 715,000 | 3,000,576 | 3,715,576 | ||||||||||||
| Commitments and contingencies | ||||||||||||||||
| Stockholders' deficit | ||||||||||||||||
| Series C 10% Preferred Stock, $0.001 par value: 1,000,000 shares authorized, 0 shares issued and outstanding | – | – | – | – | ||||||||||||
| Series D 10% Preferred Stock, $0.001 par value: 500,000 shares authorized, 0 shares issued and outstanding | – | – | – | – | ||||||||||||
| Series E 5% Preferred Stock, $0.001 par value: 10,000 shares authorized, 0 shares issued and outstanding | – | – | – | – | ||||||||||||
| Hygeia Series A convertible preferred stock, par value $0.0001: 42,000,000 shares authorized, 20,000,064 shares issued and outstanding | – | 2,000 | (2,000) | (d) | – | |||||||||||
| Canterbury Series A convertible preferred units: 91,000,000 shares authorized, 53,745,298 units issued and outstanding | – | – | – | – | ||||||||||||
| Canterbury common units, 106,000,000 units authorized,: 7,774,260 units issued and outstanding | – | – | – | – | ||||||||||||
| Canterbury profit units. Authorized 7,341,880 units: 2,349,965, units issued and outstanding | – | – | – | – | ||||||||||||
| Common stock, $0.001 par value: 1,000,000,000 shares authorized | 420,966 | 1,012 | 114,000 | (e) | 535,978 | |||||||||||
| Additional paid-in capital | 53,256,628 | 2,086,416 | 10,219,821 | (f) | 65,562,865 | |||||||||||
| Accumulated deficit | (59,966,621 | ) | (2,986,688 | ) | 2,986,688 | (g) | (59,966,621 | ) | ||||||||
| Total Stratus stockholders' deficit | (6,289,027 | ) | (897,260 | ) | 13,318,509 | 6,132,222 | ||||||||||
| Non-controlling interest/(deficit) | (47,144 | ) | – | – | (47,144 | ) | ||||||||||
| Total stockholders' deficit | (6,336,171 | ) | (897,260 | ) | 13,318,509 | 6,085,078 | ||||||||||
| Total liabilities and stockholders' deficit | $ | 3,234,508 | $ | 293,344 | $ | 16,319,085 | $ | 19,846,937 | ||||||||
____________
| (a) | Total consideration of $12,421,249 using the closing stock price at September 30, 2013 of $0.108 times 115,011,163 shares issued for the Mergers, less $7,634,644 adjustment based on preliminary allocation to intangible assets, plus deferred tax liability of $3,053,858, plus net assets acquired of $839,264. |
| (b) | To increase the carrying value of Yale License to estimated value of $7,779,000 based on the preliminary allocation, less $144,356 book value of the Yale License. |
| (c) | Fair value of patents of $ 7,779,000 less book value of $144,356 tax effected for combined Federal and state taxes. |
| (d) | To eliminate Canterbury Series A convertible preferred units. |
| (e) | To account for $115,012 for 115,011,563 shares issued for the Mergers less $1,012 to eliminate common stock of Hygeia. |
| (f) | Includes $12,421,249 fair value of shares issues less $115,012 par value of common stock less elimination of additional paid in capital of Canterbury and Hygeia $ 2,132,627, less $115,012 for the issuance of shares for the Mergers. |
| (g) | Elimination of accumulated deficit of $2,986,688 for Hygeia and Canterbury. |
| 2 |
Stratus Media Group, Inc., Hygeia Therapeutics, Inc. and Canterbury Laboratories, LLC
Pro Forma Statement of Income
For the Nine Months Ended September 30, 2013
| Nine Months Ended September 30, 2013 | ||||||||||||||||
| Stratus Media | Hygeia/ | Pro Forma | Pro Forma | |||||||||||||
| Group | Canterbury | Adjustments | Combined | |||||||||||||
| Revenues | $ | 71,667 | $ | 127,167 | $ | – | $ | 198,834 | ||||||||
| Cost of revenues | – | 89,387 | – | 89,387 | ||||||||||||
| Gross profit | 71,667 | 37,780 | – | 109,447 | ||||||||||||
| Operating expenses | ||||||||||||||||
| General and administrative | 1,766,561 | 210,359 | 340,007 | (a) | 2,316,927 | |||||||||||
| Impairment of intangible assets | 1,935,621 | – | – | 1,935,621 | ||||||||||||
| Warrants, options and stock | 4,238,650 | – | – | 4,238,650 | ||||||||||||
| Fair value of common stock exchanged for warrants | 3,069,792 | – | – | 3,069,792 | ||||||||||||
| Legal and professional services | 1,010,415 | 329,224 | – | 1,339,639 | ||||||||||||
| Research and development | – | 20,668 | – | 20,668 | ||||||||||||
| Depreciation and amortization | 24,577 | 33,808 | 560,457 | (b) | 618,842 | |||||||||||
| Total operating expenses | 12,045,616 | 594,059 | 900,464 | 13,540,139 | ||||||||||||
| Loss from operations | (11,973,949 | ) | (556,279 | ) | (900,464 | ) | (13,430,692 | ) | ||||||||
| Other (income)/expenses | ||||||||||||||||
| (Gain)/loss on adjustments to fair value of derivative liability | (8,980,077 | ) | – | – | (8,980,077 | ) | ||||||||||
| Gain on extinguishment of derivative liability | (1,409,530 | ) | – | – | (1,409,530 | ) | ||||||||||
| Other (income)/expenses | (54,498 | ) | – | – | (54,498 | ) | ||||||||||
| Interest expense | 152,778 | 20,267 | – | 173,045 | ||||||||||||
| Total other (income)/expenses | (10,291,327 | ) | 20,267 | – | (10,271,060 | ) | ||||||||||
| Net loss | (1,682,622 | ) | (576,546 | ) | (900,464 | ) | (3,159,632 | ) | ||||||||
| Net loss attributed to non-controlling interests | 28,065 | – | – | 28,065 | ||||||||||||
| Net loss attributed to Stratus Media Group | (1,654,557 | ) | (576,546 | ) | (900,464 | ) | (3,131,567 | ) | ||||||||
| Preferred dividends | 171,625 | – | – | 171,625 | ||||||||||||
| Net income/(loss) attributable to Stratus Media | ||||||||||||||||
| Group common shareholders | $ | (1,826,182 | ) | $ | (576,546 | ) | $ | (900,464 | ) | $ | (3,303,192 | ) | ||||
| Basic and diluted earnings per share | $ | (0.01 | ) | $ | (0.01 | ) | ||||||||||
| Basic and fully-diluted weighted average shares outstanding | 264,660,276 | 115,011,563 | (c) | 379,671,839 | ||||||||||||
| (a) | Additional salaries and related taxes that would be due under employment contracts for two officers for nine months ended September 30, 2013. |
| (b) | Nine months of amortization of the initial $7,779,000 value for Yale Patents, based on preliminary allocations, that is being amortized over the average 132 month remaining life of the patents. |
| (c) | Shares issued for Mergers with Canterbury and Hygeia. |
| 3 |
Stratus Media Group, Inc., Hygeia Therapeutics, Inc. and Canterbury Laboratories, LLC
Pro Forma Statement of Income
For the Year Ended December 31, 2012
| Year Ended December 31, 2012 | ||||||||||||||||
| Stratus Media | Hygeia/ | Pro Forma | Pro Forma | |||||||||||||
| Group | Canterbury | Adjustments | Combined | |||||||||||||
| Revenues | $ | 374,542 | $ | 246,731 | $ | – | $ | 621,273 | ||||||||
| Cost of revenues | 235,803 | 123,374 | – | 359,177 | ||||||||||||
| Gross profit | 138,739 | 123,357 | – | 262,096 | ||||||||||||
| Operating expenses | ||||||||||||||||
| General and administrative | 4,570,162 | 324,261 | 396,626 | (a) | 5,291,049 | |||||||||||
| Impairment of intangible assets | 1,423,844 | – | – | 1,423,844 | ||||||||||||
| Warrants, options and stock | 3,643,662 | – | – | 3,643,662 | ||||||||||||
| Legal and professional services | 2,258,898 | 77,965 | – | 2,336,863 | ||||||||||||
| Research and development | – | – | – | – | ||||||||||||
| Depreciation and amortization | 34,043 | 17,196 | 747,276 | (b) | 798,515 | |||||||||||
| Total operating expenses | 11,930,609 | 419,422 | 1,143,902 | 13,493,933 | ||||||||||||
| Loss from operations | (11,791,869 | ) | (296,065 | ) | (1,143,902 | ) | (13,231,837 | ) | ||||||||
| Other (income)/expenses | ||||||||||||||||
| Fair value of derivative liabilities in excess of proceeds | 408,501 | – | – | 408,501 | ||||||||||||
| (Gain)/loss on adjustments to fair value of derivative liability | (6,907,748 | ) | – | – | (6,907,748 | ) | ||||||||||
| Other (income)/expenses | 379,188 | – | – | 379,188 | ||||||||||||
| Present value of remaining lease payments for facilities no longer occupied | 1,010,111 | – | – | 1,010,111 | ||||||||||||
| Interest expense | 167,894 | – | – | 167,894 | ||||||||||||
| Total other (income)/expenses | (4,942,054 | ) | – | – | (4,942,054 | ) | ||||||||||
| Net loss | (6,849,815 | ) | (296,065 | ) | (1,143,902 | ) | (8,289,783 | ) | ||||||||
| Preferred dividends | 497,167 | – | – | 497,167 | ||||||||||||
| Net income/(loss) attributable to Stratus Media Group common shareholders | $ | (7,346,982 | ) | $ | (296,065 | ) | $ | (1,143,902 | ) | $ | (8,786,950 | ) | ||||
| Basic and diluted earnings per share | $ | (0.08 | ) | $ | (0.04 | ) | ||||||||||
| Basic and fully-diluted weighted average shares outstanding | 89,534,257 | 115,011,563 | (c) | 204,545,820 | ||||||||||||
| (a) | Additional salaries and related taxes that would be due under employment contracts for two officers for the year ended December 31, 2012. |
| (b) | Twelve months of amortization of the initial $7,779,000 value for Yale Patents, based on preliminary allocations, that is being amortized over the average 132 month remaining life of the patents. |
| (c) | Shares issued for Mergers with Canterbury and Hygeia. |
| 4 |