U.S. 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
Date of Report (Date of earliest event reported):
November 3, 2000
SELECT THERAPEUTICS, INC.
(Exact name of small business issuer as
specified in its charter)
Delaware 000-27353 98-0169105
State or other jurisdiction Commission (I.R.S. Employer
incorporation or organization File Number Identification No.)
124 Mt. Auburn St., Suite 200 North, Cambridge, MA 02138
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(617) 520-6693
N/A
(Former name, former address and former fiscal year,
if changed since last report)
<PAGE>
Registrant filed a Current Report on Form 8-K to report its November 3,
2000 sale of 100% of the outstanding stock of Sierra Diagnostics Inc. This
Amendment provides the pro forma financial information required by Item 7(b) of
Form 8-K.
Item 7. Financial Statements and Exhibits
(b) Pro Forma Financial Information.
Condensed Pro forma Consolidated Financial Statements of SELECT
THERAPEUTICS INC. for the three months ended September 30, 2000 and
the year ended June 30, 2000 (Unaudited)
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<PAGE>
SELECT THERAPEUTICS INC.
Condensed Pro forma Consolidated Balance Sheet
(Stated in U.S. dollars)
September 30, 2000
(Unaudited)
<TABLE>
<CAPTION>
====================================================================================================================
Sierra
Select Diagnostics
Therapeutics Inc. Pro forma
Inc. Note 3(a) adjustments Note 3 Pro forma
--------------------------------------------------------------------------------------------------------------------
Assets
<S> <C> <C> <C> <C> <C>
Cash and cash equivalents $ 6,651,490 $ 951 $ -- $ 6,650,539
Note receivable 1,394,400 (c) 1,394,400
Less deferred gain (1,394,400) (c) (1,394,400)
Inventory 26,730 26,730 --
Prepaid expenses 11,516 2,512 9,004
Net property plant and
equipment cost 102,584 101,383 1,201
--------------------------------------------------------------------------------------------------------------------
$ 6,792,320 $ 131,576 $ -- $ 6,660,744
====================================================================================================================
Liabilities and Shareholders' Equity
Liabilities:
Accounts payable $ 61,505 $ 54,737 $ -- $ 6,768
Accrued liabilities 726,492 77,881 -- 648,611
Due to parent company -- 1,394,400 1,394,400 (a) --
Accrued costs of disposition -- -- 72,000 (b) 72,000
--------------------------------------------------------------------------------------------------------------------
787,997 1,527,018 1,466,400 727,379
Shareholders' equity:
Common shares 1,233 291,575 291,575 1,233
Warrants 3,805,302 -- -- 3,805,302
Contributed surplus 13,273,955 1,073,747 1,073,747 13,273,955
Deficit accumulated during the
development stage (11,076,167) (2,760,764) (2,831,722) (11,147,125)
--------------------------------------------------------------------------------------------------------------------
6,004,323 (1,395,442) (1,466,400) 5,933,365
--------------------------------------------------------------------------------------------------------------------
$ 6,792,320 $ 131,576 $ -- $ 6,660,744
====================================================================================================================
</TABLE>
See accompanying notes to pro forma consolidated financial statements.
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<PAGE>
SELECT THERAPEUTICS INC.
Condensed Pro forma Consolidated Statement of Operations
(Stated in U.S. dollars)
Year ended June 30, 2000
(Unaudited)
<TABLE>
<CAPTION>
===================================================================================================
Sierra
Select Diagnostics
Therapeutics Inc. Pro forma
Inc. Note 4 adjustments Pro forma
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenue $ 187,632 $ 187,632 $ -- $ --
Interest income 106,070 -- -- 106,070
--------------------------------------------------------------------------------------------------
293,702 187,632 -- 106,070
Expenses:
Research and development 1,604,607 13,870 -- 1,590,737
Selling, general and administration 2,487,499 717,643 -- 1,769,856
Write down of intangibles 640,832 640,832 -- --
Depreciation 23,413 22,815 -- 598
Amortization 259,749 259,749 -- --
---------------------------------------------------------------------------------------------------
5,016,100 1,654,909 -- 3,361,191
---------------------------------------------------------------------------------------------------
Loss for the period $ 4,722,398 $ 1,467,277 $ -- $ 3,255,121
===================================================================================================
Loss per share $ (0.58) $ (0.40)
Weighted average number of shares 8,175,937 8,175,937
===================================================================================================
</TABLE>
See accompanying notes to pro forma consolidated financial statements.
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<PAGE>
SELECT THERAPEUTICS INC.
Condensed Pro forma Consolidated Statement of Operations
(Stated in U.S. dollars)
Three months ended September 30, 2000
(Unaudited)
<TABLE>
<CAPTION>
=======================================================================================================
Sierra
Select Diagnostics
Therapeutics Inc. Pro forma
Inc. Note 4 adjustments Pro forma
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Interest income $ 83,663 $ -- $ -- $ 83,663
Expenses:
Research and development 1,196,592 -- -- 1,196,592
Selling, general and administration 648,882 157,387 -- 491,495
Depreciation 6,356 6,163 -- 193
-------------------------------------------------------------------------------------------------------
1,851,830 163,550 -- 1,688,280
-------------------------------------------------------------------------------------------------------
Loss for the period $ 1,768,167 $ 163,550 $ -- $ 1,604,617
=======================================================================================================
Loss per share $ (0.15) $ (0.13)
Weighted average number of shares 11,891,687 11,891,687
=======================================================================================================
</TABLE>
See accompanying notes to pro forma consolidated financial statements.
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<PAGE>
SELECT THERAPEUTICS INC.
Notes to Condensed Pro forma Consolidated Financial Statements
(Stated in U.S. dollars)
Three months ended September 30, 2000 and year ended June 30, 2000
(Unaudited)
--------------------------------------------------------------------------------
1. Basis of presentation:
The accompanying unaudited condensed pro forma consolidated financial
statements have been prepared by management of Select Therapeutics Inc.
("Select") for inclusion in its Form 8-K Current Report document filed with
the United States Securities and Exchange Commission relating to the
disposition by Select of Sierra Diagnostics, Inc. ("Sierra") on November 3,
2000. The Company sold all of its shares in this wholly-owned subsidiary to
a group of private investors and management of Sierra in exchange for a 6%
royalty on future sales of Sierra's current products in excess of specified
thresholds and a promissory note in the amount of $1.394 million, the
amount of Select's intercompany advances receivable from Sierra. The note
is secured by certain patent rights of Sierra and bears interest at a rate
of 9.5% to December 31, 2000, thereafter to be adjusted quarterly based on
a published prime rate. There is no fixed term to maturity and repayments
are contingent upon certain future events.
The unaudited condensed pro forma consolidated financial statements have
been prepared in accordance with generally accepted accounting principles
applicable to the transaction. These unaudited condensed consolidated pro
forma financial statements have been compiled from and should be read in
conjunction with the audited financial statements of Select for the year
ended June 30, 2000 included in its most recently filed Form 10-K and the
unaudited interim financial statements of Select for the three months ended
September 30, 2000 included in its most recently filed Form 10-Q. The
unaudited condensed pro forma consolidated financial statements do not
purport to represent the financial position and results of operations that
might have occurred had the transaction actually taken place on the dates
indicated or the financial position and results of operations of Select or
Sierra as at or for any future date or period. Further, the historical
results of operations provide no indication of the future performance of
Select or Sierra.
2. Pro forma assumptions:
The unaudited condensed consolidated pro forma balance sheet assumes that
the disposition occurred on September 30, 2000. Costs of disposition, which
include estimated future patent maintenance and prosecution expenses for
the benefit of Sierra, are assumed to be $72,000. A reserve against the
note receivable is assumed on the disposition because there are significant
uncertainties as to Sierra's ability to generate the cash flows from sales
of current Sierra products necessary to make the repayments under the
promissory note.
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<PAGE>
SELECT THERAPEUTICS INC.
Notes to Condensed Pro forma Consolidated Financial Statements (continued)
(Stated in U.S. dollars)
Three months ended September 30, 2000 and year ended June 30, 2000
(Unaudited)
--------------------------------------------------------------------------------
2. Pro forma assumptions (continued):
The unaudited condensed pro forma consolidated statements of operations
assume that the disposition of Sierra occurred on July 1, 1999. No interest
income on the promissory note is assumed due to the uncertainties noted in
the preceding paragraph.
3. Pro forma balance sheet adjustments:
The unaudited condensed pro forma consolidated balance sheet as at
September 30, 2000 incorporates the following adjustments:
(a) To eliminate Select's investment in Sierra as at September 30, 2000.
(b) To reflect the estimated costs of the disposition.
(c) To reflect the promissory note receivable, less the deferred gain
arising on the disposition.
4. Pro forma income statement adjustments:
The unaudited condensed pro forma consolidated statements of operations for
the year ended June 30, 2000 and the three months ended September 30, 2000
do not require any further adjustments after the elimination of Sierra's
results of operations for year ended June 30, 2000 and the three months
ended September 30, 2000, respectively.
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<PAGE>
SIGNATURES
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.
Select Therapeutics, Inc.
Dated: December 11, 2000 By: /s/ Robert Bender
--------------------
Robert Bender
Chairman of the Board
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