UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) March 31, 1995
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BIOMAGNETIC TECHNOLOGIES, INC.
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(Exact name of registrant as specified in its charter)
California 1-10285 95-2647755
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(State or other jurisdiction Commission File Number (I.R.S.Employer
of incorporation) Identification No.)
9727 Pacific Heights Boulevard, San Diego, California 92121-3719
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(Address of principal executive offices) (zip code)
(619) 453-6300
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(Registrant's telephone number, including area code)
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(Former name, former address and formal fiscal year,
if changed since last report)
ITEM 1. CHANGES IN CONTROL OF REGISTRANT.
On March 31, 1995, Biomagnetic Technologies Inc. (the "Company") completed the
sale of 25,000,000 newly issued shares of Common Stock of the Company to
Dassesta International S.A. ("Dassesta"), a foreign investment group, for
$15,000,000. Following the closing, Dassesta is the beneficial owner of
approximately 71% of the outstanding shares of the Company (63% considering the
effect of the expected conversion of short-term notes payable to Common Stock
discussed in Item 2.). The shares issued to Dassesta have identical rights,
preferences and privileges as all other outstanding shares of Common Stock of
the Company.
The Company's By-laws provide that the authorized number of directors shall not
be less than five nor more than nine and the exact number of directors presently
authorized and serving is seven. It is anticipated that the exact number of
directors authorized will be increased to eight or nine and that any vacancies
then existing would be filled by designees of Dassesta.
The Company is not aware of any arrangement which, at a subsequent date, would
result in a change in control of the Company.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
On March 31, 1995, the Company completed the sale of 25,000,000 newly issued
shares of Common Stock of the Company to Dassesta for $15,000,000 in cash. See
Item 1.
In connection with the Dassesta transaction, the Company has arranged with
certain holders of short-term debt to either retire such debt using a portion of
the proceeds from the Dassesta transaction or convert such debt to shares of
Common Stock of the Company under certain negotiated terms. The accompanying
Unaudited Pro Forma Condensed Financial Statements are presented to show the pro
forma effect on the Company's historical consolidated financial position and
results of operations of i) the sale of Common Stock to Dassesta and the net
proceeds therefrom, ii) the March 31, 1995 retirement of $500,000 short-term
notes payable and accrued interest thereon and iii) the expected conversion of
$2,210,000 of short-term notes payable plus accrued interest and additional
principal of $221,000 to approximately 4,800,000 shares of Common
Stock of the Company at a rate of $0.54 per share.
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BIOMAGNETIC TECHNOLOGIES, INC.
PRO FORMA CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS)
YEAR ENDED SEPTEMBER 30, 1994
-----------------------------------------
PRO FORMA PRO FORMA
ACTUAL ADJUSTMENTS (UNAUDITED)
--------- --------------- -----------
Total revenues $ 3,344 $ 3,344
Cost of product sales 2,572 2,572
Contract research costs 10 10
Research and development 6,725 6,725
Marketing, general and administrative 3,959 3,959
Interest expenses 391 (330)(a) 61
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Total expenses 13,657 13,327
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NET LOSS $(10,313) $(9,983)
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THREE MONTHS ENDED
DECEMBER 31, 1994 (UNAUDITED)
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PRO FORMA
ACTUAL ADJUSTMENTS PRO FORMA
-------- ----------- ----------
Total revenues $ 2,796 $ 2,796
Cost of sales 1,525 1,525
Research and development 1,251 1,251
Marketing, general and administrative 1,093 1,093
Interest expense 236 (228)(a) 8
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Total expenses 4,105 3,877
-------- -------
NET LOSS $ (1,309) $(1,081)
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(a) Represents elimination of: interest on notes payable, amortization of debt
issue discount and amortization of debt issuance costs.
(b) The expected conversion of certain short-term debt at a discount to the
market price of common stock will result in a extraordinary loss of
approximately $782,000. Such extraordinary losses are excluded from pro
forma statements of operations in accordance with the rules of the SEC.
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BIOMAGNETIC TECHNOLOGIES, INC.
PRO FORMA CONSOLIDATED BALANCE SHEET
(IN THOUSANDS)
AS OF DECEMBER 31, 1994
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PRO FORMA PRO FORMA
ACTUAL ADJUSTMENTS (UNAUDITED)
--------- --------------- -----------
ASSETS
Cash and cash equivalents $ 2,324 14,795(a) $ 16,589
(530)(b)
Restricted cash 1,195 1,195
Accounts receivable 76 76
Inventories 1,952 1,952
Prepaid expenses and other current assets 324 (79)(c) 245
-------- --------
Total current assets 5,871 20,057
Property and equipment - net 2,412 2,412
Restricted cash 1,422 1,422
Other assets 523 523
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Total assets $ 10,228 $ 24,414
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LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable $ 975 $ 975
Accrued liabilities 1,700 (30)(b) 1,537
(133)(c)
Accrued salaries and employee benefits 443 443
Customer deposits 2,650 2,650
Notes payable to related parties 798 (798)(c) ----
Short-term debt 2,246 (500)(b) 500
(1,246)(c)
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Total current liabilities 8,812 6,105
Other liabilities 442 442
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Total liabilities 9,254 6,547
SHAREHOLDERS' EQUITY
Common stock 60,658 14,795 (a) 78,333
2,880 (c)
Accumulated deficit (59,684) (782)(c) (60,466)
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Total shareholders' equity 974 17,867
-------- --------
Total liabilities and shareholders' equity $ 10,228 $ 24,414
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(a) Reflects the sale of Common Stock to Dassesta and the net proceeds
therefrom.
(b) Reflects retirement of principal balance of $500,000 and payment of accrued
interest thereon.
(c) Reflects noteholders converting $2,210,000 of principal plus additional
principal of $221,000 plus $133,000 accrued interest to Common Stock at
$0.54 per share.
Item 7. Financial Statements and Exhibits
(b) Pro forma financial information is presented in Item 2.
(c) Exhibits:
2.1 Offshore Stock Subscription Agreement.
2.2 Form of Offer Letter to Holders of Short-term Debt.
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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 thereunto duly authorized.
BIOMAGNETIC TECHNOLOGIES, INC.
Date: April 14, 1995 By: /S/ Peter L. Millikin
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Peter L. Millikin
Vice President and Controller
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