Form 8-K

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

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 15, 2013

001-33635

(Commission file number)

 

 

CARDIUM THERAPEUTICS, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   27-0075787
(State of incorporation)  

(IRS Employer

Identification No.)

 

11750 Sorrento Valley Road, Suite 250  
San Diego, California 92121   (858) 436-1000
(Address of principal executive offices)   (Registrant’s telephone number)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


ITEM 2.01 COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS.

On November 15th 2013, Cardium Therapeutics, Inc. a Delaware corporation (“Cardium”) sold its To Go Brands® business to Healthy Brands Collective® in exchange for shares of preferred stock of Healthy Brands Collective, valued at $2,500,000 and the assumption of approximately $300,000 of liabilities. The To Go Brands® business was part of the assets of the Cardium’s To Go Brands, Inc. subsidiary. That subsidiary, which will change its name, will retain the trademarks and technology relating to the MedPodium nutra-apps and nutraceutical product line and will retain its investment interest in SourceOne, a leading nutraceutical and health sciences ingredient supplier.

Healthy Brands Collective® is a fast growing private company that has acquired a portfolio of eight independent brand product platforms including Cell-nique®, Cherrybrook Kitchen®, Yumnuts®, Living Harvest/Tempt®, Bites of Bliss®, High Country Kombucha® drinks and Organics European Gourmet Bakery (formerly Dr. Oetker) natural and organic baking mixes. Healthy Brands expects to make additional brand acquisitions and has previously reported plans to move forward as a public company as its business advances.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS

(b)(1) Pro Forma Financial Information

The following unaudited pro forma condensed consolidated balance sheets as of September 30, 2013 give effect to the sale of substantially all of the assets of Cardium’s To Go Brands, Inc. subsidiary as if the sale had been consummated on September 30, 2013. The following unaudited pro forma condensed consolidated statements of operations for the fiscal year ended December 31, 2012 and the nine months ended September 30, 2013 give effect to the sale of the sale of substantially all of the assets of Cardium’s To Go Brands, Inc. subsidiary as if the sale had been consummated at the beginning of those periods. The unaudited pro forma condensed consolidated financial statements are not necessarily indicative of the results that actually would have occurred if the sales had taken place during such period or that may be attained in the future.

The unaudited pro forma condensed consolidated financial statements should be read in conjunction with Cardium’s consolidated financial statements and notes thereto. We have prepared the unaudited pro forma condensed consolidated financial information based upon estimates and assumptions we have deemed appropriate based upon currently available information, and such estimates and assumptions are discussed in the accompanying notes. We believe that our estimates and assumptions are reasonable, and the significant effects of this sale have been properly reflected in our unaudited pro forma condensed consolidated financial statements. However, actual results will differ from the estimates and assumptions used. The unaudited condensed consolidated financial information is presented for illustrative purposes and is not designed to represent, and does not represent, what the financial position or operating results would have been had the sale of substantially all of the assets of Cardium’s To Go Brands, Inc. business been completed as of the dates assumed, nor is it intended to project Cardium’s future financial position or results of operations.

 

-2-


(d) Exhibits

 

Exhibit    Description
10.1    Asset Acquisition Agreement dated November 15, 2013 between To Go Brands, Inc. and Cell-nique Corporation.
99.1    Press Release of Cardium Therapeutics, issued on November 18, 2013

 

-3-


CARDIUM THERAPEUTICS, INC.

(A Development Stage Company)

PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET

(Unaudited)

September 30, 2013

 

     As     Proforma     Use of           Pro Forma  
     Reported     Adjustments     Proceeds      Notes    Total  
                        1       

ASSETS

            

CURRENT ASSETS

            

Cash and cash equivalents

   $ 585,201      $ —        $ —            $ 585,201   

Accounts receivable

     105,174        (97,374     —              7,800   

Inventory, net

     823,235        (463,870     —              359,365   

Prepaid expenses and other assets

     332,682        (10,132           322,550   

Total current assets

     1,846,292        (571,376     —              1,274,916   

Property and equipment, net

     65,010        (22,131     —              42,879   

Investment

     435,000        —          2,500,000            2,935,000   

Technology licenses, net

     1,097,511        —          —              1,097,511   

Intangible assets, net

     904,766        (904,766     —              —     

Goodwill

     584,711        (584,711           —     

Other long term assets

     195,920                195,920   

TOTAL ASSETS

   $ 5,129,210      $ (2,082,984   $ 2,500,000          $ 5,546,226   

LIABILITIES AND STOCKHOLDERS’ EQUITY

            

CURRENT LIABILITIES

            

Accounts payable

   $ 802,365      $ (317,308   $ —            $ 485,057   

Accrued liabilities

     364,547        0        —              364,547   

Current Liabilities

     1,166,912        (317,308     —              849,604   

Deferred rent

     11,813        —          —              11,813   

TOTAL LIABILITIES

     1,178,725        (317,308     —              861,417   

STOCKHOLDERS’ EQUITY

            

Series A Convertible Preferred Stock $0.0001 par value; 40,000,000 shares authorized 2,580.0 issued and outstanding with liquidation preferences of $1,000

     0             

Common stock, $0.0001 par value; 100,000,000 shares authorized; 46,930,439 shares issued and outstanding

     12,956        —          —              12,956   

Additional paid-in capital

     106,500,753        —          —              106,500,753   

Deficit accumulated during development stage

     (102,563,224     (1,765,676     2,500,000            (101,828,900

TOTAL STOCKHOLDERS’ EQUITY

     3,950,485        (1,765,676     2,500,000            4,684,809   

TOTAL LIABILITIES AND STOCKHOLDERS EQUITY

   $ 5,129,210      $ (2,082,984   $ 2,500,000          $ 5,546,226   

 

4


CARDIUM THERAPEUTICS, INC.

(A Development Stage Company)

PRO FORMA CONDENSED CONSOLIDATED INCOME STATEMENT

(Unaudited)

December 31, 2012

 

     As     Pro Forma     Pro Forma  
     Reported     Adjustments     Total  
           (2)        

Product Sales

   $ 785,318      $ (725,909.00   $ 59,409   

Cost of Goods Sold

     437,065        (382,914     54,151   

Gross Profit

     348,253        (342,995     5,258   

Operating Expenses

      

Research and development

     2,621,321        (40,227.00     2,581,094   

Selling general and administrative

     6,116,746        (398,761.00     5,717,985   

Total operating expenses

     8,738,067        (438,988.00     8,299,079   

Loss from operations

     (8,389,814     95,993        (8,293,821

Change in fair value of derivative liabilities

     64,157          64,157   

Interest income

     6,595        (3.00     6,592   

Interest (expense)

     (4,248     206.00        (4,042

Net loss

   $ (8,323,310   $ 96,196      $ (8,291,271

Deemed dividend on Preferred Stock

     —            —     

Net loss applicable to common stockholders

   $ (8,323,310   $ 96,196      $ (8,291,271

Basic and diluted per common shares

      

Net loss from continuing operations

   $ (1.41     —        $ (1.40

Weighted average shares outstanding - Basic and diluted

     5,922,717        —          5,922,717   

 

5


CARDIUM THERAPEUTICS, INC.

(A Development Stage Company)

PRO FORMA CONDENSED CONSOLIDATED INCOME STATEMENT

(Unaudited)

September 30, 2013

 

     As     Pro Forma     Pro Forma  
     Reported     Adjustments     Total  
           (2)        

Product Sales

   $ 1,655,342      $ (1,546,142.00   $ 109,200   

Cost of Goods Sold

     977,912        (908,753     69,159   

Gross Profit

     677,430        (637,389     40,041   

Operating Expenses

      

Research and development

     1,566,988        (114,152     1,452,836   

Selling general and administrative

     5,258,129        (1,312,154     3,945,975   

Total operating expenses

     6,825,117        (1,426,306     5,398,811   

Loss from operations

     (6,147,687     788,917        (5,358,770

Interest income

     217        —          217   

Interest (expense)

     (1,438     667        (771

Net loss

   $ (6,148,908   $ 789,584      $ (5,359,324

Deemed dividend on Preferred Stock

     (405,872       (405,872

Net loss applicable to common stockholders

   $ (6,554,780   $ 789,584      $ (5,765,196

Basic and diluted per common shares

      

Net loss from continuing operations

   $ (0.99     —        $ (0.87

Weighted average shares outstanding - Basic and diluted

     6,595,209        —          6,595,209   

 

6


Cardium Therapeutics, Inc.

NOTES TO PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE FISCAL QUARTER ENDING SEPTEMBER 30, 2013

(unaudited)

 

A.     

   The pro forma condensed consolidated balance sheets are computed assuming the transactions were consummated on September 30, 2013, and include adjustments that give effect to events that are directly attributed to the To Go Brands, Inc. transaction and are factually supportable regardless of whether they have a continuing impact or are nonrecurring.
Note 1    Eliminates the effect of To Go Brands Inc. on the consolidated balance sheet as if the sale had taken place at September 30, 2013 and records the $2,500,000 investment in Healthy Brands Collective.
Note 2    Eliminates the effect of To Go Brands Inc. on the consolidated statement of income as if the sale had taken place at the beginning of the period presented.

 

-7-


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.

 

    CARDIUM THERAPEUTICS, INC.
Date: November 21, 2013     By:  

/s/ Dennis M. Mulroy

      Dennis M. Mulroy
      Chief Financial Officer

 

-8-