<PAGE>
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) December 17, 1998
-----------------
CALYPTE BIOMEDICAL CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE
(State or other jurisdiction of incorporation
or organization)
06-1226727
(I.R.S. Employer
Identification Number)
000-20985
(Commission File No.)
1440 FOURTH STREET, BERKELEY, CALIFORNIA 94710
(Address of principal executive offices) (Zip Code)
(510) 749-5100
(Registrant's telephone number, including area code)
<PAGE>
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
(a) On December 17, 1998, Calypte Biomedical Corporation completed the
acquisition of the assets relating to the Western blot product line for
certain infectious diseases from Cambridge Biotech Corporation, a
Delaware corporation and wholly-owned subsidiary of bioMerieux, Inc.,
pursuant to an Asset Purchase Agreement between Calypte and Cambridge
dated November 18, 1998. The acquisition included the urine-based and
serum-based HIV-1 Western blot products, as well as rights to certain
other tests not currently produced by Cambridge. The assets acquired
consisted of fixtures, equipment, materials and supplies, contracts
relating to the conduct of the business of the Western blot product
line, certain licenses and permits issued by government authorities for
use in connection with the operations of Cambridge's Rockville,
Maryland manufacturing facility, marketing authorizations and
regulatory approvals relating to the Western blot product line and
certain proprietary rights.
Calypte acquired the assets from Cambridge for $500,000 in
cash, 400,000 shares of Calypte Common Stock, warrants to acquire
200,000 shares of Common Stock at an exercise price of $8.00 per share,
warrants to acquire 200,000 shares of Common Stock at an exercise price
of $10.00 per share, warrants to acquire 200,000 shares of Common Stock
at an exercise price of $12.00 per share and a royalty based upon
product sales. The cash purchase price was paid out of the cash
reserves of Calypte.
In connection with the acquisition, Calypte entered into two
subleases with Cambridge, pursuant to which it subleases from Cambridge
the buildings used in connection with the operation of the Rockville,
Maryland manufacturing facility.
Calypte and Cambridge were parties to a Master Services
Agreement dated April 12, 1996 (the "Master Services Agreement")
pursuant to which Calypte and Cambridge agreed to develop a
modification of Cambridge's serum-based HIV-1 Western blot product to
confirm the results of Calypte's initial screening test using urine
samples. Except for the Master Services Agreement, there was no
material relationship between Calypte or any of its affiliates
(including their respective officers and directors and any associate of
any such individual), on the one hand, and Cambridge or any of its
affiliates (including their respective officers and directors and any
associate of any such individual), on the other hand.
(b) Prior to the acquisition, Cambridge used the assets acquired by
Calypte in the manufacture and sale of urine-based and serum-based
HIV-1 Western blot products, as well as a confirmatory test for Human
T-Lymphotropic Virus. Calypte intends to continue the operation of the
assets from Cambridge's current facilities (located in Rockville,
Maryland) in substantially the same manner and for the same purposes.
Exhibit 2.1 and Exhibit 4.1, respectively, incorporated herein
by reference, are the Asset Purchase Agreement and the Form of Warrant
to Purchase Common Stock, which were filed as exhibits to Calypte's
Current Report on Form 8-K on January 4, 1999. The foregoing
description of the acquisition is qualified in its entirety by
reference to the exhibits.
2
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) FINANCIAL STATEMENTS OF BUSINESS ACQUIRED.
The following financial statements of Cambridge Biotech Western Blot (a
division of Cambridge Biotech Corporation, a wholly-owned subsidiary of
bioMerieux, Inc.) required pursuant to Rule 3-05(b) of Regulation S-X
are filed with this amendment to Calypte's Current Report on Form 8-K
which was originally filed on January 4, 1999.
CAMBRIDGE BIOTECH WESTERN BLOT
(A Division of Cambridge Biotech Corporation, a
Wholly-Owned Subsidiary of bioMerieux, Inc.)
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
Independent Auditors' Report 4
FINANCIAL STATEMENTS:
Balance Sheets 5
Statements of Operations 6
Statements of Division Capital 7
Statements of Cash Flows 8
Notes to Financial Statements 9
</TABLE>
3
<PAGE>
INDEPENDENT AUDITORS' REPORT
The Board of Directors
Cambridge Biotech Corporation:
We have audited the accompanying balance sheet of Cambridge Biotech Western Blot
(the Business), a division of Cambridge Biotech Corporation, a wholly-owned
subsidiary of bioMerieux, Inc., as of December 31, 1997, and the related
statements of operations, division capital, and cash flows for the year then
ended. These financial statements are the responsibility of the Business's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement procedures. We
believe that our audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Cambridge Biotech Western Blot,
a division of Cambridge Biotech Corporation, a wholly-owned subsidiary of
bioMerieux, Inc., as of December 31, 1997, and the results of its operations and
its cash flows for the year then ended in conformity with generally accepted
accounting principles.
As discussed in note 7 to the financial statements, on December 17, 1998,
certain assets of Cambridge Biotech Western Blot were sold to Calypte
Biomedical Corporation.
/s/ KPMG LLP
St. Louis, Missouri
February 19, 1999
4
<PAGE>
CAMBRIDGE BIOTECH WESTERN BLOT
(A Division of Cambridge Biotech Corporation, a
Wholly-Owned Subsidiary of bioMerieux, Inc.)
Balance Sheets
(in thousands)
<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30,
ASSETS 1997 1998
-------------- --------------
(unaudited)
<S> <C> <C>
Current assets:
Accounts receivable $ 458 $ 845
Inventory 1,332 1,107
Prepaid expenses 41 56
-------------- --------------
Total current assets 1,831 2,008
Property and equipment, net 966 846
Patents, net 477 451
-------------- --------------
Total assets $ 3,274 $ 3,305
-------------- --------------
-------------- --------------
LIABILITIES AND DIVISION CAPITAL
Current liabilities:
Accounts payable $ 154 $ 51
Accrued expenses 123 114
Accrued royalties 180 164
-------------- --------------
Total liabilities 457 329
Division capital 2,817 2,976
-------------- --------------
Total liabilities and division capital $ 3,274 $ 3,305
-------------- --------------
-------------- --------------
</TABLE>
See accompanying notes to financial statements.
5
<PAGE>
CAMBRIDGE BIOTECH WESTERN BLOT
(A Division of Cambridge Biotech Corporation, a
Wholly-Owned Subsidiary of bioMerieux, Inc.)
Statements of Operations
(in thousands)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEAR ENDED SEPTEMBER 30,
DECEMBER 31, ---------------------------------
1997 1997 1998
---------------------------------- ---------------
(unaudited) (unaudited)
<S> <C> <C> <C>
Revenues - product sales $ 3,352 $ 2,568 $ 2,907
---------------- ----------------- ---------------
Expenses:
Product costs 5,059 3,699 3,548
Research, development, and regulatory 422 167 424
Sales and marketing 270 207 190
General and administrative 229 172 102
---------------- ----------------- ---------------
Total expenses 5,980 4,245 4,264
---------------- ----------------- ---------------
Net loss $ (2,628) $ (1,677) $ (1,357)
---------------- ----------------- ---------------
---------------- ----------------- ---------------
</TABLE>
See accompanying notes to financial statements.
6
<PAGE>
CAMBRIDGE BIOTECH WESTERN BLOT
(A Division of Cambridge Biotech Corporation, a
Wholly-Owned Subsidiary of bioMerieux, Inc.)
Statements of Division Capital
(in thousands)
<TABLE>
<S> <C>
Balance at December 31, 1996 $ 2,871
Intercompany advances 2,574
Net loss (2,628)
--------------
Balance at December 31, 1997 2,817
Intercompany advances (unaudited) 1,516
Net loss (unaudited) (1,357)
--------------
Balance at September 30, 1998 (unaudited) $ 2,976
--------------
--------------
</TABLE>
See accompanying notes to financial statements.
7
<PAGE>
CAMBRIDGE BIOTECH WESTERN BLOT
(A Division of Cambridge Biotech Corporation, a
Wholly-Owned Subsidiary of bioMerieux, Inc.)
Statements of Cash Flows
(in thousands)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEAR ENDED SEPTEMBER 30,
DECEMBER 31, -------------------------------
1997 1997 1998
--------------- --------------- -------------
(unaudited) (unaudited)
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss $ (2,628) $ (1,677) $ (1,357)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization 455 391 199
Changes in assets and liabilities:
Accounts receivable 50 (94) (387)
Inventory (38) 35 225
Prepaid expenses 4 3 (15)
Accounts payable (117) (67) (103)
Accrued expenses 64 26 (9)
Accrued royalties 137 54 (16)
--------------- --------------- -------------
Net cash used in operating activities (2,073) (1,329) (1,463)
Cash flows from investing activities - purchase of
property and equipment, net (501) (424) (53)
Cash flows from financing activities - proceeds from
intercompany advances 2,574 1,753 1,516
--------------- --------------- -------------
Net change in cash - - -
Cash at beginning of period - - -
--------------- --------------- -------------
Cash at end of period $ - $ - $ -
--------------- --------------- -------------
--------------- --------------- -------------
</TABLE>
See accompanying notes to financial statements.
8
<PAGE>
CAMBRIDGE BIOTECH WESTERN BLOT
(A Division of Cambridge Biotech Corporation, a
Wholly-Owned Subsidiary of bioMerieux, Inc.)
Notes to Financial Statements
December 31, 1997 and September 30, 1998 (unaudited)
(dollars in thousands)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This summary of significant accounting policies is presented to assist in
understanding the Business's financial statements. These accounting
policies conform to generally accepted accounting principles.
BUSINESS ACTIVITY
Cambridge Biotech Western Blot (the Business) is a division of
Cambridge Biotech Corporation (Cambridge), which operates as a
wholly-owned subsidiary of bioMerieux, Inc. (bioMerieux). Cambridge's
retroviral diagnostic business was acquired by bioMerieux in October
1996 and is located in Rockville, Maryland. bioMerieux, located in
St. Louis, Missouri, is part of bioMerieux S.A., an international
biotechnology group based in Lyon, France, dedicated to in-vitro
diagnostics with a special focus on infectious diseases.
The Business has developed a western blot confirmatory test for the
detection of the Human Immunodeficiency Virus, Type-1 (HIV-1), the
putative cause of Acquired Immunodeficiency Syndrome (AIDS). The
Business's western blot confirmatory test was licensed by the Food
and Drug Administration (FDA) for use with urine on May 28, 1998. The
Business also produces HTLV-I/II western blot confirmatory tests for
the detection of the Human T-Lymphotropic Virus, and Lyme IgG and
Lyme IgM western blot tests.
BASIS OF PRESENTATION
The accompanying financial statements include the accounts of the
Western Blot division of Cambridge's business, certain assets of
which bioMerieux has sold to Calypte Biomedical Corporation (Calypte)
(see note 7). The financial statements have been prepared utilizing
reasonable methods of allocating common expenses, including
incremental and proportional cost allocation methods, to the Business
in instances where specific identification of expenses was not
practicable. The allocation methods utilized represent management's
best estimate of the expenses incurred by the Business.
The balance sheet as of September 30, 1998, the statements of
operations, division capital, and cash flows for the nine-month
period ended September 30, 1998, and the statements of operations and
cash flows for the nine-month period ended September 30, 1997
(interim financial information) have been prepared by the Business
and are unaudited. In the opinion of the Business, the interim
financial information includes all adjustments, consisting of only
normal recurring adjustments, necessary for a fair statement of the
results of the interim periods. Certain information and footnote
disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been
condensed or omitted from the interim financial information. The
interim financial information should be read in conjunction with the
Business's December 31, 1997 audited financial statements appearing
herein. The results for the nine-month periods ended September 30,
1998 and 1997 may not be indicative of operating results for the full
year.
(Continued)
9
<PAGE>
CAMBRIDGE BIOTECH WESTERN BLOT
(A Division of Cambridge Biotech Corporation, a
Wholly-Owned Subsidiary of bioMerieux, Inc.)
Notes to Financial Statements
December 31, 1997 and September 30, 1998 (unaudited)
(dollars in thousands)
USE OF ESTIMATES
The preparation of the financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results could differ from those
estimates.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents are maintained at the Business's parent,
Cambridge, with cash requirements for operating activities
transferred to/from Cambridge as required. The net cash activity as
of and for the year ended December 31, 1997 is reflected in the
accompanying balance sheet under division capital. No cash balance
existed at the Business at December 31, 1997 or September 30, 1998
(unaudited).
INVENTORY
Inventory is stated at the lower of cost or market. Cost is
determined using the first-in, first-out method.
PROPERTY AND EQUIPMENT
Property and equipment are stated at cost. Machinery and laboratory
equipment, furniture and fixtures, and computer equipment are
depreciated using the straight-line method over the estimated useful
lives of the assets, generally five to seven years. Leasehold
improvements are amortized over the shorter of the remaining lease
term of the useful life of the improvement.
PATENTS
Costs associated with obtaining patents are capitalized as incurred
and are amortized over their remaining useful lives (generally 15
years). Accumulated amortization was $43 at December 31, 1997.
FAIR VALUE OF FINANCIAL INSTRUMENTS
Financial assets and liabilities have carrying values which
approximate their fair value for all periods presented due to their
short-term maturity.
REVENUE RECOGNITION
Revenue from product sales is recognized upon shipment to customers.
10 (Continued)
<PAGE>
CAMBRIDGE BIOTECH WESTERN BLOT
(A Division of Cambridge Biotech Corporation, a
Wholly-Owned Subsidiary of bioMerieux, Inc.)
Notes to Financial Statements
December 31, 1997 and September 30, 1998 (unaudited)
(dollars in thousands)
RESEARCH AND DEVELOPMENT
Research and development costs are charged to operations as incurred.
Total research and development expense for the year ended December
31, 1997 was $229.
INCOME TAXES
For income tax purposes, the Business is included in the consolidated
tax returns filed by bioMerieux. Income taxes in the accompanying
financial statements have been calculated on a basis as if the
Business filed its own return.
Deferred tax assets and liabilities are recognized for the estimated
future tax consequences attributable to differences between the
financial statement carrying amounts of existing assets and
liabilities and their respective tax bases and operating loss
carryforwards. Deferred tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years in
which those temporary differences are expected to be recovered or
settled. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that
includes the enactment date.
CAPITAL AND LIQUIDITY SUPPORT
The Business has incurred significant losses since its acquisition by
bioMerieux. Losses are largely attributable to lower than expected
sales volumes. The Business is substantially dependent upon the
economic resources of bioMerieux and Cambridge to meet its
obligations as they come due. bioMerieux and Cambridge have routinely
contributed, and continued to contribute through the date of sale to
Calypte, additional capital in order to provide the Business with
sufficient financial resources to meet its obligations as they come
due and to maintain an adequate level of capital in order to fund
operations.
11 (Continued)
<PAGE>
CAMBRIDGE BIOTECH WESTERN BLOT
(A Division of Cambridge Biotech Corporation, a
Wholly-Owned Subsidiary of bioMerieux, Inc.)
Notes to Financial Statements
December 31, 1997 and September 30, 1998 (unaudited)
(dollars in thousands)
(2) INVENTORY
Inventory as of December 31, 1997 and September 30, 1998 (unaudited)
consisted of the following:
<TABLE>
<CAPTION>
December 31, September 30,
1997 1998
------------------ ------------------
(unaudited)
<S> <C> <C>
Raw materials $ 230 196
Work in process 1,561 1,082
Finished goods 55 326
------------------ ------------------
1,846 1,604
Less reserve for obsolescence 514 497
------------------ ------------------
$ 1,332 1,107
------------------ ------------------
------------------ ------------------
</TABLE>
(3) PROPERTY AND EQUIPMENT
Property and equipment as of December 31, 1997 consisted of the
following:
<TABLE>
<S> <C>
Computer equipment $ 57
Machinery and laboratory equipment 1,244
Furniture and fixtures 24
Leasehold improvements 109
------------
1,434
Less accumulated depreciation and amortization 468
------------
$ 966
------------
------------
</TABLE>
12 (Continued)
<PAGE>
CAMBRIDGE BIOTECH WESTERN BLOT
(A Division of Cambridge Biotech Corporation, a
Wholly-Owned Subsidiary of bioMerieux, Inc.)
Notes to Financial Statements
December 31, 1997 and September 30, 1998 (unaudited)
(dollars in thousands)
(4) LEASES
The Business leases office and manufacturing space in Rockville, Maryland
under noncancellable operating leases. Total rent expense during the year
ended December 31, 1997 was approximately $369.
The following is a schedule of future minimum rental payments required
under operating leases that have initial or remaining noncancellable lease
terms in excess of one year at December 31, 1997:
<TABLE>
<S> <C>
Year ending December 31:
1998 $ 474
1999 474
2000 484
2001 515
2002 515
Thereafter 2,571
------------
$ 5,033
------------
------------
</TABLE>
(5) INCOME TAXES
There is no current or deferred tax expense for the year ended December 31,
1997.
The net tax effects of temporary differences between the carrying amounts
of assets and liabilities for financial reporting purposes and the amounts
used for income tax purposes are reflected in deferred income taxes.
Significant components of the Business's deferred tax assets and
liabilities as of December 31, 1997 are as follows:
<TABLE>
<S> <C>
Deferred tax assets (liabilities):
Provision for uncollectible receivables $ 12
Provision for obsolete inventory 190
Accrued vacation 21
Net operating loss carryforwards 881
Tax in excess of book depreciation (16)
------------
1,088
Less valuation allowance 1,088
------------
$ --
------------
------------
</TABLE>
13 (Continued)
<PAGE>
CAMBRIDGE BIOTECH WESTERN BLOT
(A Division of Cambridge Biotech Corporation, a
Wholly-Owned Subsidiary of bioMerieux, Inc.)
Notes to Financial Statements
December 31, 1997 and September 30, 1998 (unaudited)
(dollars in thousands)
A valuation allowance is established for deferred tax assets if, based on
the weight of available evidence, it is more likely than not that some
portion or all of the deferred tax assets will not be realized. The
ultimate realization of deferred tax assets is dependent upon the
generation of future taxable income during periods in which those temporary
differences become deductible. Because there is uncertainty regarding the
Business's ability to realize its deferred tax assets, a 100% valuation
allowance has been established. The net change in the valuation allowance
for the year ended December 31, 1997 was an increase of $925.
The Business has approximately $2,382 of net operating loss carryforwards
for income tax purposes, which will begin to expire, if unused, in the year
2011, as calculated on a basis as if the Business filed its own return. The
net operating loss carryforwards have been utilized in entirety by
bioMerieux in its consolidated tax returns.
A reconciliation of the income tax provision expressed as a percent of loss
before income tax with the federal statutory income tax rate for the year
ended December 31, 1997 is as follows:
<TABLE>
<S> <C>
Federal statutory income tax rate 34%
State and local income taxes, net of federal income tax benefit 3
Increase in net operating loss carryforwards (37)
----------
--%
----------
----------
</TABLE>
(6) CONCENTRATIONS OF CREDIT RISK
The Business has one customer whose activity represents a significant
portion of outstanding receivables and sales. Ortho Diagnostics Systems,
Inc. comprised 35% of outstanding receivables at December 31, 1997 and 43%
of sales for the year ended December 31, 1997.
(7) SUBSEQUENT EVENT
On December 17, 1998, bioMerieux sold the inventory, property and
equipment, licenses, permits, and proprietary rights of the Business to
Calypte in exchange for consideration of $500 in cash, 400,000 shares of
unregistered Calypte common stock, and 600,000 warrants exerciseable into
Calypte common stock.
14
<PAGE>
(b) PRO FORMA FINANCIAL INFORMATION.
The following unaudited pro forma financial information required pursuant
to Article 11 of Regulation S-X is filed with this amendment to Calypte's
Form 8-K which was originally filed on January 4, 1999.
CALYPTE BIOMEDICAL CORPORATION
Unaudited Pro Forma Condensed Combined Balance Sheet
September 30, 1998
(in thousands)
<TABLE>
<CAPTION>
CALYPTE CAMBRIDGE
BIOMEDICAL BIOTECH PRO FORMA PRO FORMA
ASSETS CORPORATION WESTERN BLOT ADJUSTMENTS COMBINED
----------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Current assets:
Cash and cash equivalents $ 1,456 $ - $ (500) (1) $ 956
Securities available for sale 1,873 - 1,873
Accounts receivable 198 845 (845) (2) 198
Inventory 847 1,107 (226) (3) 1,728
Note receivable - related party 768 -- 768
Other current assets 718 56 (56) (2) 718
----------------- -------------- -------------- --------------
Total current assets 5,860 2,008 (1,627) 6,241
Property and equipment, net 1,060 846 14 (3) 1,920
349 (6)
Other assets 210 451 (451) (2) 559
----------------- -------------- -------------- --------------
Total assets $ 7,130 $ 3,305 $ (1,715) $ 8,720
----------------- -------------- -------------- --------------
----------------- -------------- -------------- --------------
LIABILITIES, MANDATORILY REDEEMABLE
PREFERRED STOCK AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 1,028 $ 51 $ (51) (2) $ 1,028
Accrued expenses 1,032 278 (278) (2) 1,032
Capital lease obligation - current portion 341 -- 341
Deferred revenue 500 -- 500
----------------- -------------- -------------- --------------
Total current liabilities 2,901 329 (329) 2,901
----------------- -------------- -------------- --------------
Deferred rent obligation 32 -- 32
Capital lease obligation - long-term portion 112 -- 112
----------------- -------------- -------------- --------------
15
<PAGE>
Total liabilities 3,045 329 (329) 3,045
----------------- -------------- -------------- --------------
Mandatorily redeemable Series A preferred stock 2,066 -- 2,066
Commitments and contingencies
1,590 (4)
Stockholders' equity 2,019 2,976 (2,976) (5) 3,609
----------------- -------------- -------------- --------------
Total liabilities, mandatorily redeemable
Preferred stock and stockholders' equity $ 7,130 $ 3,305 $ (1,715) $ 8,720
----------------- -------------- -------------- --------------
----------------- -------------- -------------- --------------
</TABLE>
See notes to unaudited pro forma condensed combined financial statements.
16
<PAGE>
CALYPTE BIOMEDICAL CORPORATION
Unaudited Pro Forma Condensed Combined Statement of Operations
Nine Months Ended September 30, 1998
(in thousands, except per share data)
<TABLE>
<CAPTION>
CALYPTE CAMBRIDGE
BIOMEDICAL BIOTECH PRO FORMA PRO FORMA
CORPORATION WESTERN BLOT ADJUSTMENTS COMBINED
-------------- -------------- --------------- ---------------
<S> <C> <C> <C> <C>
Revenues - product sales $ 684 $ 2,907 $ (277) (7) $ 3,314
-------------- -------------- --------------- ---------------
Expenses:
Product costs 1,503 3,548 (277) (8) 4,774
Research and development 2,883 424 3,307
Selling, general and administrative 2,953 292 52 (9) 3,297
-------------- -------------- --------------- ---------------
Total expenses 7,339 4,264 (225) 11,378
-------------- -------------- --------------- ---------------
Loss from operations (6,655) (1,357) (52) (8,064)
Other income (expense) 266 - 266
-------------- -------------- --------------- ---------------
Loss before income taxes (6,389) (1,357) (52) (7,798)
Income taxes (2) - (2)
-------------- -------------- --------------- ---------------
Net loss (6,391) (1,357) (52) (7,800)
Less dividends on mandatorily redeemable
Series A preferred stock (90) - (90)
-------------- -------------- --------------- ---------------
Net loss attributable to common stockholders $ (6,481) $ (1,357) $ (52) $ (7,890)
-------------- -------------- --------------- ---------------
-------------- -------------- --------------- ---------------
Net loss per share:
Basic and diluted $ (0.48) $ (0.57)
-------------- ---------------
-------------- ---------------
Weighted average shares used to compute
net loss per share attributable to common
stockholders (basic and diluted) 13,404 13,804
-------------- ---------------
-------------- ---------------
</TABLE>
See notes to unaudited pro forma condensed combined financial statements.
17
<PAGE>
CALYPTE BIOMEDICAL CORPORATION
Unaudited Pro Forma Condensed Combined Statement of Operations
Year Ended December 31, 1997
(in thousands, except per share data)
<TABLE>
<CAPTION>
CALYPTE CAMBRIDGE
BIOMEDICAL BIOTECH PRO FORMA PRO FORMA
CORPORATION WESTERN BLOT ADJUSTMENTS COMBINED
--------------- --------------- --------------- --------------
<S> <C> <C> <C> <C>
Revenues - product sales $ 376 $ 3,352 $ (210) (7) $ 3,518
--------------- --------------- --------------- --------------
Expenses:
Product costs 2,305 5,059 (210) (8) 7,154
Research and development 3,685 422 4,107
Selling, general and administrative 2,317 499 70 (9) 2,886
--------------- --------------- --------------- --------------
Total expenses 8,307 5,980 (140) 14,147
--------------- --------------- --------------- --------------
Loss from operations (7,931) (2,628) (70) (10,629)
Other income (expense) 139 - 139
--------------- --------------- --------------- --------------
Loss before income (7,792) (2,628) (70) (10,490)
taxes
Income taxes (2) - (2)
--------------- --------------- --------------- --------------
Net loss (7,794) (2,628) (70) (10,492)
Less dividends on mandatorily redeemable
Series A preferred stock (120) - (120)
--------------- --------------- --------------- --------------
Net loss attributable to common stockholders $ (7,914) $ (2,628) $ (70) $ (10,612)
--------------- --------------- --------------- --------------
--------------- --------------- --------------- --------------
Net loss per share:
Basic and diluted $ (0.72) $ (0.93)
--------------- --------------
--------------- --------------
Weighted average shares used to compute
net loss per share attributable to common
stockholders (basic and diluted) 11,028 11,428
--------------- --------------
--------------- --------------
</TABLE>
See notes to unaudited pro forma condensed combined financial statements.
18
<PAGE>
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS (DOLLARS
IN THOUSANDS)
On December 17, 1998, Calypte Biomedical Corporation (Calypte) completed the
acquisition of the assets relating to the Western Blot product line for certain
infectious diseases from Cambridge Biotech Corporation (Cambridge), pursuant to
an Asset Purchase Agreement between Calypte and Cambridge dated November 18,
1998.
Calypte acquired the assets in exchange for $500 in cash, 400,000 shares of
unregistered common stock, warrants to acquire 200,000 shares of common stock at
an exercise price of $8.00 per share, warrants to acquire 200,000 shares of
common stock at an exercise price of $10.00 per share, and warrants to acquire
200,000 shares of common stock at an exercise price of $12.00 per share.
The unaudited pro forma condensed combined balance sheet as of September 30,
1998 has been prepared assuming that the acquisition had occurred as of that
date. Pro forma unaudited condensed combined statements of operations for the
year ended December 31, 1997 and the nine months ended September 30, 1998 have
been prepared assuming that the acquisition had occurred as of the beginning of
the respective periods. The pro forma unaudited condensed combined statements of
operations are not necessarily indicative of results that would have occurred
had the acquisition been consummated as of the beginning of the periods
presented or that might be attained in the future.
The purchase price, purchase-price allocation, and financing of the transaction
are summarized as follows:
<TABLE>
<S> <C>
Purchase price paid as:
Cash $ 500
Common stock 1,150
Warrants (fair market value) 440
-----------
Total purchase price 2,090
-----------
-----------
Allocated to:
Inventory 881
Property and equipment 860
Intangible assets (licenses, permits,
and proprietary rights) 349
-----------
Total assets acquired $ 2,090
-----------
-----------
</TABLE>
Pro forma adjustments are as follows:
(1) To reflect the cash paid by Calypte as partial consideration for the
acquisition.
(2) To reflect the elimination of assets not purchased and liabilities not
assumed in acquisition.
(3) To reflect the adjustment of inventory and property and equipment to fair
market value as determined by Asset Purchase Agreement.
(4) To reflect the issuance of 400,000 unregistered shares of common stock and
600,000 warrants exerciseable in shares of common stock as partial
consideration for the acquisition. Fair value of the common stock (as
determined by closing stock price on December 17, 1998) and warrants stock
(as determined by using Black-Scholes pricing model) aggregated $1,590.
19
<PAGE>
(5) To reflect the elimination of the division equity of Cambridge Biotech
Western Blot.
(6) To reflect the fair market value of intangible assets (licenses, permits,
and proprietary rights) acquired from Cambridge Biotech Western Blot.
(7) To reflect the elimination of Cambridge Biotech Western Blot revenue for
products sold to Calypte.
(8) To reflect the elimination of Calypte product expense for purchases from
Cambridge Biotech Western Blot that were sold in the corresponding period.
(9) To reflect the amortization of intangible assets on a straight-line basis
over 5 years.
20
<PAGE>
(c) EXHIBITS.
<TABLE>
<S> <C>
2.1 Asset Purchase Agreement, dated as of November 18, 1998, between Calypte
and Cambridge (incorporated by reference to Exhibit 2.1 of Calypte's
Current Report on Form 8-K filed January 4, 1999).
4.1 Form of Warrant to Purchase Common Stock (incorporated by reference to
Exhibit 4.1 of Calypte's Current Report on Form 8-K filed January 4,
1999).
23.1 Consent of KPMG LLP, Independent Auditors.
99.1 Press Release issued by Calypte on November 24, 1998 (incorporated by
reference to Exhibit 99.1 of Calypte's Current Report on Form 8-K filed
January 4, 1999).
</TABLE>
21
<PAGE>
SIGNATURE
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, thereto duly authorized.
CALYPTE BIOMEDICAL CORPORATION
BY: /s/ John J. DiPietro
------------------------------------------
John J. DiPietro
Chief Operating Officer,
Vice President - Finance,
Chief Financial Officer and Secretary
Date: March 5, 1999
<PAGE>
Exhibit 23.1
INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Cambridge Biotech Corporation:
We consent to inclusion of our report dated February 19, 1999, with respect
to the balance sheet of Cambridge Biotech Western Blot as of December 31,
1997 and the related statements of operations, division capital, and cash
flows for the year ended December 31, 1997, which report appears in the
Form 8-K/A of Calypte Biomedical Corporation dated March 5, 1999.
/s/ KPMG LLP
St. Louis, Missouri
March 5, 1999
