SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
Amendment No. 1
Current Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 10, 1998
Lynx Therapeutics, Inc.
(Exact name of registrant as specified in its charter)
Delaware 0-22570 94-3161073
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File Number) Identification No.)
3832 Bay Center Place
Hayward, CA 94545
(Address of principal executive offices) (Zip Code)
(510) 670-9300
(Registrant's telephone number, including area code)
Total number of pages: 7
Page 1 of 7
<PAGE>
The Registrant hereby amends Item 7 of its Current Report on Form 8-K,
filed with the Commission on March 24, 1998, in its entirety to read as follows:
Item 7. Financial Statements and Exhibits
(a) Financial Statements of Businesses acquired
Not applicable.
(b) Pro Forma Financial Information
The accompanying unaudited pro forma financial information gives effect
to the sale of the Registrant's portfolio of phosphorothioate antisense patents
and licenses and its therapeutic oligonucleotide manufacturing facility (the
"Antisense Business") as if the transaction had occurred on January 1, 1997 for
purposes of the unaudited statement of operations, and as of December 31, 1997
for purposes of the unaudited balance sheet. No gain from the sale has been
reflected in the unaudited pro forma statement of operations due to the
nonrecurring nature of this transaction.
The actual gain on the sale of the Antisense Business will be reported
in Lynx Therapeutics, Inc.'s unaudited financial statements included in the
Quarterly Report on Form 10-Q for the period ended March 31, 1998 to be filed no
later than May 15, 1998.
(c) Exhibits
2.1** + Acquisition Agreement, dated as of February 4, 1998,
by and between Inex Pharmaceuticals Corporation and
Lynx.
99.1 + Press release dated February 5, 1998.
** Portions of this agreement have been deleted pursuant to our request for
confidential treatment.
+ Included with the Registrant's Current Report on Form 8-K, filed with the
Commission on March 24, 1998.
2.
<PAGE>
Item 7. (b)
Lynx Therapeutics, Inc.
Unaudited Pro Forma Financial Statements
The following unaudited pro forma financial statements represent the
transaction in which Lynx Therapeutics, Inc. ("Lynx" or the "Company") sold its
portfolio of phosphorothioate antisense patents and licenses, and its
therapeutic oligonucleotide manufacturing facility (collectively, the "Antisense
Business"), to Inex Pharmaceuticals Corporation ("Inex") of Vancouver, Canada,
under the terms of the Acquisition Agreement, dated as of February 4, 1998, by
and between Inex Pharmaceuticals Corporation and Lynx Therapeutics, Inc. (the
"Acquisition Agreement"). The sale was consummated on March 10, 1998.
Under the terms of the Acquisition Agreement, the Company received $3
million in cash and will receive 1.2 million shares of Inex common stock, in
three equal installments, with the first 400,000 shares received on March 10,
1998, and the second and third installments of stock to be received no later
than two and three years, respectively, from the closing date of the
transaction. The Inex common stock received by Lynx is subject to certain
restrictions on trading for specific periods of time following receipt by Lynx.
Lynx is also entitled to receive royalties on future sales of phosphorothioate
antisense products. In addition, Lynx agreed to a royalty-bearing license to
Inex for its phosphoroamidate chemistry for certain therapeutic applications in
the fields of cancer and inflammation that will be defined later.
During 1997, revenues from the Antisense Business were derived
principally from sales of LR-3280 clinical materials to, and cost reimbursements
from, Schwarz Pharma AG. These revenues represented 11% of the Company's
revenues in 1997. The Company does not expect the sale of the Antisense Business
to have a significant impact on the Company's future revenues.
The unaudited financial information ("Lynx Therapeutics, Inc. Net of
Antisense Business") gives effect to the sale of the Antisense Business as if
the transaction had occurred on January 1, 1997, for purposes of the unaudited
statement of operations, and as of December 31, 1997, for purposes of the
unaudited balance sheet.
The pro forma information is presented for illustrative purposes only
and is not necessarily indicative of operating results or financial position
that would have occurred if the sale had been consummated as presented in the
accompanying unaudited pro forma financial information nor is it necessarily
indicative of future operating results or financial position.
The unaudited pro forma condensed financial information should be read
in conjunction with the accompanying note and the historical financial
statements, including the notes thereto, as filed with the Commission on the
Company's Annual Report on Form 10-K for the year ended December 31, 1997.
3.
<PAGE>
Item 7. (b)
<TABLE>
Lynx Therapeutics, Inc.
Unaudited Pro Forma Balance Sheet
December 31, 1997
(In thousands)
<CAPTION>
Lynx Lynx
Therapeutics, Inc. Therapeutics, Inc.
Assets Lynx Antisense Net of
Therapeutics, Business Antisense
Inc. (a) Sold (b) Business (c)
----------------------------------------------
<S> <C> <C> <C>
Current assets:
Cash and cash equivalents $ 8,798 $ 3,000 $ 11,798
Short-term investments 16,132 -- 16,132
Accounts receivable 244 -- 244
Other current assets 199 -- 199
----------------------------------------------
Total current assets 25,373 3,000 28,373
Property and equipment:
Leasehold improvements 3,795 -- 3,795
Laboratory and other equipment 3,562 (1,444) 2,118
----------------------------------------------
7,357 (1,444) 5,913
Less accumulated depreciation (3,588) 1,234 (2,354)
----------------------------------------------
Net property and equipment 3,769 (210) 3,559
Notes receivable from officers and employees 125 (85) 40
Other assets -- 883 883
----------------------------------------------
$ 29,267 $ 3,588 $ 32,855
==============================================
Liabilities and stockholders' equity
Current liabilities:
Accounts payable $ 210 $ -- $ 210
Accrued compensation 289 -- 289
Accrued professional fees 179 -- 179
Deferred revenue from related parties 2,292 -- 2,292
Other accrued liabilities 528 67 595
----------------------------------------------
Total current liabilities 3,498 67 3,565
Other noncurrent liabilities 179 -- 179
Stockholders' equity:
Preferred stock, issuable in series, $.001 par value; 2,000,000 shares
authorized, all shares designated represent convertible preferred stock:
Series B, 332,288 shares designated, issued, and outstanding at December 31,
1997; aggregate liquidation value of $16,614 at December 31, 1997 16,091 -- 16,091
Series C, 123,299 shares designated, issued, and outstanding at December 31,
1997; aggregate liquidation value of $6,165 at December 31, 1997 6,109 -- 6,109
Series D, 40,000 shares designated, issued, and outstanding at December 31,
1997; aggregate liquidation value of $5,000 at December 31, 1997 4,989 -- 4,989
Common stock, $.001 par value; 20,000,000 shares authorized,
5,892,353 shares issued and outstanding at December 31, 1997 46,640 170 46,810
Notes receivable from stockholders (460) -- (460)
Deferred compensation (5,394) -- (5,394)
Unrealized gain/(loss) on marketable securities (45) -- (45)
Accumulated deficit (42,340) 3,351 (38,989)
-----------------------------------------------
Total stockholders' equity 25,590 3,521 29,111
-----------------------------------------------
$ 29,267 $ 3,588 $ 32,855
===============================================
<FN>
(a) Represents historical Lynx Therapeutics, Inc., financial statements,
including the Antisense Business sold.
(b) Reflects the cash and the first installment of Inex common stock received
on the transaction date, the Antisense Business assets sold to Inex, and
certain other costs associated with the transaction and incurred by Lynx.
(c) Represents historical Lynx Therapeutics, Inc., financial statements with
reflection of the amounts referred to in (b) above.
See accompanying note.
</FN>
</TABLE>
4.
<PAGE>
Item 7. (b)
<TABLE>
Lynx Therapeutics, Inc.
Unaudited Pro Forma Consolidated Statement of Operations
For the year ended December 31, 1997
(In thousands, except per share amounts)
<CAPTION>
Less: Lynx Lynx
Therapeutics, Inc. Therapeutics, Inc.
Lynx Antisense Net of
Therapeutics, Inc. Business Antisense
(a) Sold (b) Business (c)
-------------------------------------------------------------
<S> <C> <C> <C>
Net revenues:
Revenues from collaborative arrangements
with related parties $ 4,420 $ 523 $ 3,897
Product sales and other revenues 162 -- 162
-------------------------------------------------------------
Total revenues 4,582 523 4,059
Operating costs and expenses:
Research and development 14,226 2,892 11,334
Selling, general and administrative 1,930 174 1,756
-------------------------------------------------------------
Total operating costs and expenses 16,156 3,066 13,090
-------------------------------------------------------------
Loss from operations (11,574) (2,543) (9,031)
Interest income 753 (140) 893
-------------------------------------------------------------
Provisions for income taxes
Net loss $ (10,821) $ (2,683) $ (8,138)
=============================================================
Basic and diluted net loss per share $ (3.09) $ (0.77) $ (2.32)
=============================================================
Shares used in basic and diluted per
share computation 3,501 3,501 3,501
=============================================================
<FN>
(a) Represents historical Lynx Therapeutics, Inc., financial statements,
including the Antisense Business.
(b) Reflects the Antisense Business sold, exclusive of any gain realized on the
sale.
(c) Represents historical Lynx Therapeutics, Inc. financial statements, net of
the Antisense Business sold, exclusive of any gain realized on the sale.
See accompanying note.
</FN>
</TABLE>
5.
<PAGE>
Item 7. (b)
Lynx Therapeutics, Inc.
Note to Unaudited Pro Forma Financial Statements
The pro forma financial statements give effect to the following pro
forma adjustments:
The preceding unaudited pro forma financial statements represent the
transaction in which Lynx Therapeutics, Inc. ("Lynx" or the "Company") sold its
portfolio of phosphorothioate antisense patents and licenses, and its
therapeutic oligonucleotide manufacturing facility (the "Antisense Business"),
to Inex Pharmaceuticals Corporation ("Inex") of Vancouver, Canada, under the
terms of the Acquisition Agreement, dated as of February 4, 1998, by and between
Inex Pharmaceuticals Corporation and the Company (the "Acquisition Agreement").
The sale was consummated on March 10, 1998.
Under the terms of the Acquisition Agreement, the Company received $3
million in cash and will receive 1.2 million shares of Inex common stock, in
three equal installments, with the first 400,000 shares received on March 10,
1998, and the second and third installments of stock to be received no later
than two and three years, respectively, from the closing date of the
transaction. The Inex common stock received by Lynx is subject to certain
restrictions on trading for specific periods of time following receipt by Lynx.
Lynx is also entitled to receive royalties on future sales of phosphorothioate
antisense products. In addition, Lynx has agreed to a royalty-bearing license to
Inex for its phosphoroamidate chemistry for certain therapeutic applications in
the fields of cancer and inflammation that will be defined later.
During 1997, revenues from the Antisense Business were derived
principally from sales of LR-3280 clinical materials to, and cost reimbursements
from, Schwarz Pharma AG. These revenues represented 11% of the Company's
revenues in 1997. The Company does not expect the sale of the Antisense Business
to have a significant impact on the Company's future revenues.
The unaudited financial information ("Lynx Therapeutics, Inc. Net of
Antisense Business") gives effect to the sale of the Antisense Business as if
the transaction had occurred on January 1, 1997, for purposes of the unaudited
statements of operations, and as of December 31, 1997, for purposes of the
unaudited balance sheet.
6.
<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.
Lynx Therapeutics, Inc.
--------------------------------------------
(Registrant)
May 11, 1998 /s/ Edward C. Albini
- ----------------------------- --------------------------------------------
(Date) Edward C. Albini
Chief Financial Officer
(Principal Financial and Accounting Officer)
7.
