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):
April 9, 1998
PROCEPT, INC.
(Exact name of registrant as specified in its charter)
Delaware 0-21134 04-2893483
(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Identification No.)
840 Memorial Drive, Cambridge, Massachusetts
02139 (Address of principal executive offices and zip code)
(617) 491-1100
(Registrant's telephone number, including area code)
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This Current Report on Form 8-K/A amends Exhibit 99.1 of, and restates in
its entirety, the Current Report on Form 8-K dated April 9, 1998.
Item 5. Other Events.
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On April 9, 1998, pursuant to a Confidential Term Sheet and Subscription
Agreements between Procept, Inc. ("Procept") and investors meeting certain
qualifications, Procept conducted a final closing (the "Final Closing") of an
aggregate of 98.025 units (the "Units"), each Unit consisting of 20,000 shares
of Common Stock, $0.01 par value (the "Common Stock"), and warrants to purchase
20,000 shares of Common Stock at an exercise price of $5.00 per share, for
$100,000 per Unit representing aggregate gross proceeds to Procept of $9,802,500
(including an aggregate of $175,000 representing settlement of past
liabilities). As part of the Final Closing, The Aries Fund and the Aries
Domestic Fund, L.P. exchanged an aggregate of 30,060 shares of Series A
Convertible Preferred Stock, $0.01 par value per share, and warrants to purchase
an aggregate of 328,314 shares of Procept Common Stock for an aggregate of
42.084 Units (i.e., 841,680 shares of Procept Common Stock and warrants to
purchase 841,680 shares of Procept Common Stock at an exercise price of $5.00
per share).
The above numbers of shares of Common Stock are adjusted to reflect the
June 1, 1998 one-for- ten reverse split of Common Stock.
This Current Report on Form 8-K is being filed to provide pro forma
financial information of Procept at March 31, 1998, adjusted to reflect (i) the
above transaction and (ii) the merger of VacTex, Inc. ("VacTex") into a
subsidiary of Aquila Biopharmaceuticals, Inc. ("Aquila") and the issuance of
Aquila common stock and debentures in exchange for VacTex common stock, which
occurred on April 13, 1998, in each case as if it had occurred as of March 31,
1998.
As of April 9, 1998, Procept is in compliance with the criteria for
continued listing in The Nasdaq SmallCap Market (other than the minimum bid
price requirement, for which it has an exception) as set forth in the Nasdaq
Marketplace Rules.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
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(c) Exhibits.
99.1 Pro forma balance sheet of Procept at March 31, 1998.
Filed herewith.
99.2 Press release dated April 9, 1998. Filed as Exhibit 99.2 to the
Company's Current Report on Form 10-K dated April 9, 1998,
Commission File No. 0-21134, and incorporated herein by reference.
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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.
Date: June 23, 1998 PROCEPT, INC.
By: /s/ John F. Dee
-------------------------------------
John F. Dee
President and Chief Financial Officer
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EXHIBIT INDEX
Exhibit
No. Description
- -------- ------------
99.1 Pro forma balance sheet of Procept at March 31, 1998.
Filed herewith.
99.2 Press release dated April 9, 1998. Filed as Exhibit 99.2 to
the Company's Current Report on Form 10-K dated April 9, 1998,
Commission File No. 0-21134, and incorporated herein by
reference.
These Balance Sheets are being presented to show the Pro-Forma effects of two
transactions on the historical amounts of Procept, Inc. as if they had occurred
on March 31, 1998. Amounts referenced by "(B)" refer to Footnote B which fully
describes the April 9, 1998 final closing of a unit offering, which began in
January and February of 1998, where the Company sold shares of Common Stock and
The Aries Fund and the Aries Domestic Fund, L.P. exchanged Preferred Stock and
warrants for units of Common Stock and warrants. Amounts referenced by "(C)"
refer to Footnote C which fully describes the Company's investment in VacTex,
Inc., the merger of VacTex, Inc. into Aquila Biopharmaceuticals, Inc. and its
effect on the Company's investment in VacTex, Inc. Neither transaction "(B)" or
"(C)" had an effect on the Statements of Operations.
PROCEPT, INC.
BALANCE SHEETS
(unaudited)
----------------
<TABLE>
<CAPTION>
Pro-Forma Adjustments
----------------------------------
March 31, 1998 (A) Debit Credit Pro-Forma (A)
-------------- ------------- ------------ ----------
<S> <C> <C> <C> <C>
Assets
Current Assets:
Cash and cash equivalents $2,124,110 $5,338,342 (B) $7,462,452
Accounts receivable 151,061 151,061
Prepaid expenses and other current assets 142,498 142,498
--------------- ------------- ------------ -------------
Total Current Assets 2,417,669 5,338,342 $ -- 7,756,011
--------------- ------------- ------------ -------------
Property and equipment, net 712,883 712,883
Deferred financing charges 126,395 126,395 (B) --
Investment in VacTex/Aquila 300,000 475,022 (C) 775,022
Other assets 257,026 257,026
--------------- ------------- ------------ -------------
Total Assets $3,813,973 $5,813,364 $126,395 $9,500,942
=============== ============= ============ =============
Liabilities and Shareholders' Equity
Current Liabilities:
Accounts payable $1,194,383 $50,000 (B) $1,144,383
Accrued compensation 298,724 298,724
Other current liabilities 156,719 $40,000 (B) 196,719
Current portion of capital lease obligations 13,535 13,535
--------------- ------------- ------------ -------------
Total Current Liabilities 1,663,361 50,000 40,000 1,653,361
--------------- ------------- ------------ -------------
Other noncurrent liabilities 341,742 341,742
Shareholders' Equity:
Preferred stock 301 301 (B) --
Common stock 8,807 21,177 (B) 29,984
Additional paid in capital 65,231,471 1,166,169 (B) 6,367,240 (B) 70,432,542
Accumulated deficit (59,202,464) (59,202,464)
Cumulative dividends on preferred stock (4,217,388) (4,217,388)
Unrealized gain on securities available for sale -- 475,022 (C) 475,022
Treasury Stock (11,857) (11,857)
--------------- ------------- ------------ -------------
Total Shareholders' Equity 1,808,870 1,166,470 6,863,439 7,505,839
--------------- ------------- ------------ -------------
Total Liabilities and
Shareholders' Equity $3,813,973 $1,216,470 $6,903,439 $9,500,942
=============== ============= ============ =============
</TABLE>
(A), (B), (C) Refers to Notes to Balance Sheets
The accompanying notes are an integral part of the balance sheets.
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NOTES TO BALANCE SHEETS
A. Basis of Presentation
The accompanying balance sheet and Pro-Forma balance sheet as of March
31, 1998 are unaudited and have been prepared by Procept, Inc. (the
"Company") in accordance with generally accepted accounting principles.
The balance sheets, in the opinion of management, reflect all
adjustments (consisting only of normal recurring accruals) necessary
for a fair presentation. These balance sheets should be read in
conjunction with the audited financial statements for the year ended
December 31, 1997, which are contained in the Company's 1997 Annual
Report on Form 10-K.
B. Shareholders' Equity
As part of a unit offering, the Company sold an aggregate of 1,276,000
shares of Common Stock on April 9, 1998, together with five-year
warrants to purchase 1,276,000 shares of Common Stock at an exercise
price of $5.00 per share. This transaction has been reflected on the
balance sheets under the heading "Pro-Forma Adjustments." These
securities were sold for gross proceeds of $6,380,000. After expenses
the Company received cash of $5,338,342. Expenses included settlement
of a $50,000 accounts payable balance in exchange for 0.5 units and the
payment of $991,658 in underwriting fees which was charged to
additional paid-in capital. The Pro-Forma amounts have also been
adjusted to reflect legal and accounting fees of $40,000 and deferred
financing costs of $126,395, all of which have been charged to
additional paid-in capital. The sale of 1,276,000 shares of Common
Stock resulted in increases in Common Stock of $12,760 and additional
paid-in capital of $6,367,240. Also on April 9, 1998, The Aries Fund
and the Aries Domestic Fund, L.P. exchanged an aggregate of 30,060
shares of Series A Convertible Preferred Stock, representing all
outstanding shares of preferred stock, and warrants to purchase an
aggregate 328,314 shares of Common Stock at an exercise price of $10.90
per share for units made up of 841,680 shares of Common Stock and
five-year warrants to purchase 841,680 shares of Common Stock at an
exercise price of $5.00 per share. The exchange of Series A Convertible
Preferred Stock for Common Stock resulted in an increase in Common
Stock of $8,417, a decrease in Preferred Stock of $301, and a decrease
in additional paid-in capital of $8,116.
<PAGE>
C. Investment in VacTex/Aquila
On April 13, 1998, VacTex, Inc. ("VacTex") was acquired by Aquila
Biopharmaceuticals, Inc. ("Aquila"). The Company's investment in VacTex
of 300,000 shares of common stock was converted to 113,674 shares of
Aquila common stock and $128,501 of 7% debentures. This transaction has
been reflected on the balance sheets under the heading "Pro-Forma
Adjustments." As a result, the Company is accounting for its investment
under Statement of Financial Accounting Standards No. 115 "Accounting
for Certain Investments in Debt and Equity Securities" as an available
for sale security and marked it to market by recording an unrealized
gain of $475,022 as part of Shareholders' Equity, based on Aquila's
common stock closing price on April 13, 1998. The Company's investment
in VacTex was originally accounted for under the cost method since it
was a restricted security, did not have a readily determinable fair
value, and Procept owned less than twenty percent of VacTex.
