EX-99.2 3 ea022190801ex99-2_aditxt.htm UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS AS OF AND FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2024

Exhibit 99.2

 

 

 

 

Aditxt Inc.

 

Unaudited Pro Forma Consolidated Financial Statements

(In U.S. dollars)

September 30, 2024

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Aditxt Inc.

Pro Forma Consolidated Statement of Financial Position

(Unaudited)

(In thousands of U.S. dollars)

As of September 30, 2024

 

   Aditxt   Evofem   Appili
(Note 3)
   Pro Forma
adjustments
   Notes  Pro Forma
consolidated
 
ASSETS  $   $   $   $      $ 
CURRENT ASSETS:                       
Cash   329    -    493    22,104   5(a)   22,926 
Restricted cash   -    722    -    -       722 
Accounts receivable, net   352    5,393    538    -       6,283 
Inventory   89    1,463    -    -       1,552 
Prepaid expenses   444    999    84    -       1,527 
Subscription receivable   875    -    -    -       875 
Other receivable   -    -    18    -       18 
TOTAL CURRENT ASSETS   2,088    8,577    1,133    22,104       33,903 
                             
Fixed assets, net   1,716    1,181    18    -       2,915 
Intangible assets, net   7    14,021    -    6,077   5(b)   20,105 
Deposits   102    -    -    -       102 
Right of use asset - long term   1,388    127    -    -       1,515 
Other assets   -    36    -    -       36 
Goodwill   -    -    -    142,919   5(c)   142,919 
Investment in Evofem / Appili   24,537    -    -    (24,537)  5(d)   - 
TOTAL ASSETS   29,839    23,942    1,151    146,563       201,495 

 

The accompanying notes are an integral part to these unaudited pro forma consolidated financial statements.

 

1

 

 

Aditxt Inc.

Pro Forma Consolidated Statement of Financial Position

(Unaudited)

(In thousands of U.S. dollars)

As of September 30, 2024

 

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)  Aditxt   Evofem   Appili
(Note 3)
   Pro Forma
Adjustments
   Notes  Pro Forma
Consolidated
 
CURRENT LIABILITIES:  $   $   $   $      $ 
Accounts payable and accrued expenses   14,585    25,210    3,115    2,600   5(e)   45,510 
Notes payable and other current liabilities - related party   467    685    -    (685)  5(e)   467 
Notes payable, and other short term debt, net of discount   8,373    268    -    -       8,641 
Financing on fixed assets   148    -    -    -       148 
Deferred rent   118    -    -    -       118 
Convertible notes payable carried at fair value   -    14,183    -    (14,183)  5(e)   - 
Convertible notes payable - Adjuvant   -    30,202    -    (30,202)  5(e)   - 
Derivative liabilities   -    162    -    (162)  5(e)   - 
Other current liabilities   -    4,652    -    -       4,652 
Corporate taxes payable   -    -    31    -       31 
Long-term debt - current   -    -    7,117    -       7,117 
Lease liability - current   678    116    -    -       794 
Contingent liabilities - current   -    808    -    -       808 
TOTAL CURRENT LIABILITIES   24,369    76,286    10,263    (42,632)      68,286 
                             
Derivative Liability   429    -    -    -       429 
Long-term debt – non-current   -    -    603    -       603 
Lease liability - long term   592    10    -    -       602 
Contingent liabilities - non-current   -    13,775    -    -       13,775 
TOTAL LIABILITIES   25,390    90,071    10,866    (42,632)      83,695 
                             
Convertible and redeemable preferred stock   -    4,759    -    82,081   5(f)   86,840 
                             
STOCKHOLDERS’ EQUITY (DEFICIT)                            
Common stock   1    10    -    (10)  5(g)   1 
Treasury stock   (202)   -    -    -       (202)
Additional paid-in capital   167,781    825,430    44,730    (840,147)  5(g)   197,793 
Accumulated other comprehensive income (loss)   -    (1,707)   128    1,579   5(g)   - 
Accumulated equity (deficit)   (162,868)   (894,621)   (54,573)   945,692   5(g)   (166,370)
    4,712    (70,888)   (9,715)   107,114       31,222 
NON-CONTROLLING INTEREST   (263)   -    -    -       (263)
TOTAL STOCKHOLDERS’ EQUITY (DEFICIT)   4,449    (70,888)   (9,715)   107,114       30,960 
TOTAL LIABILITIES, CONVERTIBLE AND REDEEMABLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT)   29,839    23,942    1,151    

146,563

       

201,495

 

 

The accompanying notes are an integral part to these unaudited pro forma consolidated financial statements.

 

2

 

 

Aditxt Inc.

Consolidated Pro Forma Statement of Earnings

(Unaudited)

(In thousands of U.S. dollars, except earnings per share)

For the nine months ended September 30, 2024

 

   Aditxt   Evofem   Appili
(Note 3)
   Pro Forma Adjustments   Notes  Pro Forma Consolidated 
REVENUE  $   $   $   $      $ 
Sales   131    12,259    12    -       12,402 
Cost of goods sold   556    2,322    -    -       2,878 
Amortization of intangible asset   -    301    -    -       301 
Gross profit (loss)   (426)   9,636    12    -       9,222 
OPERATING EXPENSES                            
Research and development   10,190    1,196    4,176    -       15,562 
Sales and marketing   95    6,970    15    -       7,079 
General and administrative expenses   11,502    8,143    1,644    -       21,289 
Total operating expenses   21,787    16,309    5,835    -       43,931 
                             
NET LOSS FROM OPERATIONS   (22,213)   (6,673)   (5,823)   -       (34,708)
                             
OTHER INCOME/(EXPENSE)                            
Interest expense   (4,151)   -    -    -       (4,151)
Interest income   1    13    1    -       15 
Other income (expense), net   -    (1,736)   (49)   1,665   5(h)   (120)
Amortization of debt discount   (2,902)   -    -    -       (2,902)
Amortization of intangible assets   -    -    -    (344)  5(h)   (344)
Loss on issuance of financial instruments   -    (3,300)   -    3,300   5(h)   - 
Gain on debt extinguishment   -    977    -    (977)  5(h)   - 
Change in fair value of financial instruments   -    4,896    -    (4,896)  5(h)   - 
Financing costs   -    -    (1,576)   -       (1,576)
Government assistance   -    -    4,931    -       4,931 
Gain (loss) on note exchange agreement   (209)   -    -    -       (209)
Total other income/(expense)   (7,260)   850    3,307    (1,252)      (4,355)
                             
Net earnings/loss before income taxes   (29,473)   (5,823)   (2,516)   (1,252)      (39,064)
                             
Income tax expense   -    -    (7)   -       (7)
                             
NET EARNINGS/LOSS   (29,220)   (5,823)   (2,523)   (1,252)      (39,071)
                             
NON-CONTROLLING INTEREST LOSS   (253)   -    -    -       (253)
                             
NET LOSS ATTRIBUTABLE TO ADITXT, INC. & SUBSIDIARIES   (29,220)   (5,823)   (2,523)   (1,252)      (38,818)
                             
Deemed Dividend   (5,907)   (99)   -    99   5(h)   (5,907)
                             
NET EARNINGS/LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS   (35,127)   (5,922)   (2,523)   (1,153)      (44,725)
                             
NET LOSS per share:                            
Basic   (522.86)                     (111.80)
Diluted   (522.86)                     (111,80)
                             
Weighted average number of shares:                            
Basic   67,182                      400,058 
Diluted   67,182                      400,058 

 

The accompanying notes are an integral part to these unaudited pro forma consolidated financial statements.

 

3

 

 

Aditxt Inc.

Notes to Pro Forma Consolidated Financial Statements

(Unaudited)

(In thousands of U.S. dollars)

For the nine months ended September 30, 2024

 

1Description of Transactions

 

Acquisition of Appili Therapeutics Inc. by Aditxt Inc.:

 

On December 12, 2023, Aditxt Inc. (“Aditxt”), through its wholly owned subsidiary, Adivir, Inc. (“Adivir”), entered into an agreement, as amended and restated, to acquire all of the outstanding Class A common shares of Appili Therapeutics Inc. (“Appili”) by way of a court approved plan of arrangement under the Canada Business Corporations Act and a definitive arrangement agreement entered between Appili and Adivir (the “Appili Transaction”). Upon closing of the Appili Transaction, Appili will become an indirect, wholly owned subsidiary of Aditxt. As part of the acquisition terms, Appili shareholders will receive 0.002745004 of a share of Aditxt common stock (the “Share Consideration”) and US$0.0467 in cash for each Appili share held (the “Cash Consideration” and together with Share Consideration collectively, the “Appili Transaction Consideration”), representing total consideration of approximately $6,108 based on closing price of the Aditxt shares on November 12, 2024. The consideration for acquiring Appili also included the assumption of Appili’s existing liabilities.

 

Acquisition of Evofem Biosciences by Aditxt:

 

On December 11, 2023, Aditxt, through a definitive agreement, entered into an Agreement and Plan of Merger, as amended and restated, with Evofem Biosciences, Inc. (“Evofem”) whereby Evofem will merge with a merger sub (‘Adifem”,the Merger Sub”), with Evofem surviving as as a wholly owned subsidiary of Aditxt (the “Evofem Transaction” and together with the Appili Transaction collectively, (“the Transactions”)). The consideration for acquiring Evofem includes the issuance or exchange of convertible preferred stock of $91,610, and cash consideration of $1,800 to Evofem’s common stockholders, along with paying off Evofem’s senior secured notes amounting to $15,669, investment of $4,000 to Evofem and the assumption of Evofem’s existing liabilities.

 

On July 12, 2024 (the “Closing Date” of the Amended and Restated Merger Agreement, as amended), Aditxt completed the Initial Parent Equity Investment (as defined under the Amended and Restated Merger Agreement) and entered into a Securities Purchase (the “Series F-1 Securities Purchase Agreement”) with Evofem, pursuant to which the Aditxt purchased 500 shares of Evofem’s Series F-1 Convertible Preferred Stock par value $0.0001 per share (“Evofem F-1 Preferred Stock”) for an aggregate purchase price of $500. In connection with the Series F-1 Securities Purchase Agreement, Aditxt and Evofem entered into a Registration Rights Agreement (the “Registration Rights Agreement”), pursuant to which Evofem agreed to file with the SEC a registration statement covering the resale of the shares of its common stock issuable upon conversion of the Evofem Series F-1 Preferred Stock within 300 days of the Closing Date and to have such registration statement declared effective by the SEC the earlier of the (i) 90th calendar day after the Closing Date and (ii) 2nd Business Day after the date Evofem is notified (orally or in writing, whichever is earlier) by the SEC that such registration statement will not be reviewed or will not be subject to further review. Pursuant to the Merger Agreement, Aditxt was also obligated to purchase an additional 3,500 shares of Evofem Series F-1 Preferred Stock for an additional aggregate purchase price of $3,500 on or prior to October 2, 2024.

 

The total purchase of 4,000 shares of Evofem Series F-1 Preferred stock, with 1,260 shares being purchased in the 3 months ended September 30, 2024 and the remaining 2,740 shares being purchased in October 2024, for an aggregate purchase price of $4,000 was completed as scheduled. On November 19, 2024, Evofem, Aditxt and Merger Sub entered into the Fourth Amendment to the Amended and Restated Merger Agreement (the “Fourth Amendment”) to change the required consummation date to January 31, 2025.

 

4

 

 

Aditxt Inc.

Notes to Pro Forma Consolidated Financial Statements

(Unaudited)

(In thousands of U.S. dollars)

For the nine months ended September 30, 2024

 

2Basis of preparation

 

The accompanying unaudited Pro Forma Consolidated Financial Statements of Aditxt have been prepared to give effect to the acquisitions of Evofem and Appili under the acquisition method of accounting in accordance with ASC Topic 805 – Business Combinations (“ASC 805”). The unaudited Pro Forma Consolidated Statement of Financial Position gives effect to the transactions as if they had occurred on September 30, 2024. The unaudited Pro Forma Consolidated Statement of Earnings for the nine months ended September 30, 2024, gives effect to the transactions as if they had occurred on January 1, 2023. The unaudited Pro Forma Consolidated Statement of Financial Position combines the unaudited interim condensed consolidated statement of financial position of Aditxt as of September 30, 2024, with the unaudited interim condensed consolidated statement of financial position of Evofem as of September 30, 2024, and the adjusted unaudited interim condensed consolidated statement of financial position of Appili as of September 30, 2024 (see Note 3). Certain amounts may not foot due to rounding.

 

The unaudited Pro Forma Consolidated Financial Statements are based on, and should be read in conjunction with:

 

the audited consolidated financial statements of Aditxt as of and for the year ended December 31, 2023 (“Aditxt’s 2023 Annual Consolidated Financial Statements”) prepared in U.S. dollars and in accordance with accounting principles generally accepted in the United States (“US GAAP);

 

the audited consolidated financial statements of Evofem as of and for the year ended December 31, 2023 (“Evofem’s 2023 Annual Consolidated Financial Statements”) prepared in U.S. dollars and in accordance with US GAAP;

 

the unaudited interim condensed consolidated financial statements of Aditxt as of and for the nine months ended September 30, 2024 (“Aditxt’s 2024 Interim Condensed Consolidated Financial Statements”) prepared in U.S. dollars and in accordance with accounting principles generally accepted in the United States (“US GAAP);

 

the unaudited interim condensed consolidated financial statements of Evofem as of and for the nine months ended September 30, 2024 (“Evofem’s 2024 Interim Condensed Consolidated Financial Statements”) prepared in U.S. dollars and in accordance with accounting principles generally accepted in the United States (“US GAAP);

 

the audited consolidated financial statements of Appili as of and for the year ended March 31, 2024 (Appili’s 2024 Annual Consolidated Financial Statements”) prepared in Canadian Dollars (“CAD”) and in accordance with Internation Financial Reporting Standards (“IFRS”); and

 

the unaudited interim condensed consolidated financial statements for the six months ended September 30, 2024 (“Appili 2024 Interim Condensed Consolidated Financial Statements”) prepared in CAD and in accordance with IFRS.

 

5

 

 

Aditxt Inc.

Notes to Pro Forma Consolidated Financial Statements

(Unaudited)

(In thousands of U.S. dollars)

For the nine months ended September 30, 2024

 

2Basis of preparation (continued)

 

For the purposes of preparing the unaudited Pro Forma Consolidated Financial Statements, adjustments have been made to align the financial information to US GAAP and convert to U.S. dollars (see Note 3).

 

The unaudited Pro Forma Consolidated Financial Statements have been presented for illustrative purposes only. The pro forma information is not necessarily indicative of what the combined company financial position or financial performance would have been had the transactions been completed as at the dates indicated above, nor does it purport to project the future financial position or operating results of the combined company. The unaudited Pro Forma Consolidated Financial Statements do not reflect potential cost savings, operating synergies, and revenue enhancements that may be realized from the transactions. The actual financial position and results of operations of Aditxt for any period following the closing of the transactions may vary from the amounts set forth in the unaudited Pro Forma Consolidated Financial Statements, and such variations could be material.

 

The pro forma adjustments are based upon available information and certain assumptions believed to be reasonable under the circumstances. The purchase price allocation and the corresponding fair value adjustments are provisional and subject to refinement as more detailed analyses are completed and additional information about the fair value of assets acquired and liabilities assumed becomes available. Aditxt will finalize all amounts as it obtains the necessary information to complete the measurement process, which will be no later than one year from the closing of the transactions. Accordingly, the pro forma adjustments are preliminary and have been made solely for the purpose of providing the unaudited Pro Forma Consolidated Financial Statements. Differences between these preliminary estimates and the final acquisition accounting may occur, and these differences could be material to the accompanying unaudited Pro Forma Consolidated Financial Statements and Aditxt’s future financial performance and financial position.

 

6

 

 

Aditxt Inc.

Notes to Pro Forma Consolidated Financial Statements

(Unaudited)

(In thousands of U.S. dollars)

For the nine months ended September 30, 2024

 

3IFRS to US GAAP Reconciliation

 

For the purposes of preparing the unaudited Pro Forma Interim Consolidated Financial Statements, adjustments have been made to align the financial information of Appili to US GAAP and convert to U.S. dollars as detailed below.

 

As the ending date of the fiscal period for Appili differs from that of Aditxt, adjustments were made to combine the historical results of Appili for the year ended March 31, 2024, with the six months period ended September 30, 2024, resulting in a recreated statement of earnings for the nine months ended September 30, 2024, as summarized below:

 

 

Appili Therapeutics Inc

  As reported on
September 30,
2024
   US GAAP
Adjustments
   Notes  As of
September 30,
2024
   Currency
Translation
Adjustments
   Notes  As of
September 30,
2024
 

 

Consolidated Balance Sheet

  (IFRS)          (US GAAP)          (US GAAP) 
   (CAD)          (CAD)          (U.S. Dollars) 
   $          $          $ 
Assets  
Current Assets                               
Cash   665         -    665    (172)  (b)   493 
Accounts receivable   726    -       726    (188)  (b)   538 
Other receivable   24    -       24    (6)  (b)   18 
Prepaid expenses   113    -       113    (29)  (b)   84 
    1,528    -       1,528    (395)      1,133 
Non-Current Assets                               
Fixed assets, net   26    -       26    (8)  (b)   18 
Total Assets   1,554    -       1,554    (403)      1,151 

 

7

 

 

Aditxt Inc.

Notes to Pro Forma Consolidated Financial Statements

(Unaudited)

(In thousands of U.S. dollars)

For the nine months ended September 30, 2024

 

3IFRS to US GAAP Reconciliation (continued)

 

Appili Therapeutics Inc  As reported on
September 30,
2024
   US GAAP
Adjustments
   Notes  As of
September 30,
2024
   Currency
Translation
Adjustments
   Notes  As of
September 30,
2024
 

 

Consolidated Balance Sheet

  (IFRS)          (US GAAP)          (US GAAP) 
   (CAD)          (CAD)          (U.S. Dollars) 
    $            $            $ 
Liabilities     
Current Liabilities                               
Accounts payable and accrued expenses   4,205           -       4,205    (1,090)  (b)   3,115 
Long-term debt - current   9,608    -       9,608    (2,491)  (b)   7,117 
Corporate taxes payable   42    -       42    (11)  (b)   31 
    13,855    -       13,855    (3,592)      10,263 
Non-Current liabilities                               
Long-term debt - non-current   814    -       814    (211)  (b)   603 
Total Liabilities   14,669    -       14,669    (3,803)      10,866 
                                
Shareholder’s Equity                               
Additional paid-in capital   58,306    -       58,306    (13,576)  (c)   44,730 
Accumulated deficit   (71,421)   -       (71,421)   16,848   (c)   (54,573)
Currency translation adjustments   -    -       -    128   (d)   128 
Total Shareholder’s Equity   (13,115)   -       (13,115)   3,400       (9,715)
                                
Total Liabilities and Shareholder’s Equity   1,554    -       1,554    (403)      1,151 

 

8

 

 

Aditxt Inc.

Notes to Pro Forma Consolidated Financial Statements

(Unaudited)

(In thousands of U.S. dollars)

For the nine months ended September 30, 2024

  

3IFRS to US GAAP Reconciliation (continued)

 

Appili Therapeutics Inc  9 months
ended
September 30,
2024
(Recreated)
  

US GAAP

Adjustments

   Notes  9 months
ended
September 30,
2024
  

Currency

translation
adjustments

   Notes  9 months
ended
September 30,
2024
 
   (IFRS)          (US GAAP)          (US GAAP) 
   (CAD)        (CAD)        (U.S. Dollars) 
Income   $            $            $ 
Sales   16            -    16    (4)  (e)   12 
Interest income   1    -       1    -   (e)   1 
    18    -       17    (4)      13 
Expenses                               
Research and development   5,666    14   (a)   5,680    (1,504)  (e)   4,176 
Sales and marketing   20    -       20    (5)  (e)   15 
General and administrative expenses   2,236    -       2,236    (592)   (e)   1,644 
Financing costs   2,144    -       2,144    (568)  (e)   1,576 
Government assistance   (6,693)   (14)  (a)   (6,707)   1,776   (e)   (4,931)
Other expense   66    -       66    (17)  (e)   49 
    3,438    -       3,439    (910)      2,529 
Loss before income taxes   (3,420)   -       (3,422)   906       (2,516)
Income tax expense   10    -       10    (3)  (e)   7 
Net loss   (3,431)   -       (3,432)   909       (2,523)

 

(a)Reflects a presentation conforming adjustment to reclassify recognition of government grant funding relating to research and development activities on conversion from IFRS to US GAAP.

 

(b)Reflects a currency translation adjustment from CAD to US dollars using the closing exchange rate on September 30, 2024, of 0.7408.

 

(c)Reflects a currency translation adjustment from CAD to US dollars using the closing historical exchange rate for equity transactions and subsequently carried at historic values.

 

(d)Reflects a presentation currency translation difference adjustment arising on translation of CAD to US dollars using historical rates.

 

(e)Reflects a currency translation adjustment from CAD to US dollars using the average exchange rate for the nine months ended September 30, 2024, of 0.7351.

 

9

 

 

Aditxt Inc.

Notes to Pro Forma Consolidated Financial Statements

(Unaudited)

(In thousands of U.S. dollars)

For the nine months ended September 30, 2024

 

4Preliminary Purchase Price Allocation

 

The following is a preliminary fair value estimate of the assets acquired, and liabilities assumed by Aditxt in connection with Appili Transaction and Evofem Transaction, reconciled to the purchase price. For any items without a corresponding reference below, book value is assumed to reasonably approximate fair value based on currently available information.

   Notes  Evofem   Appili 
Assets acquired      $    $ 
Cash      -    493 
Restricted cash      722    - 
Accounts receivable      5,393    538 
Inventory      1,463    - 
Prepaid expenses      999    84 
Other receivable      -    18 
Intangible assets  (a)   14,021    6,880 
Fixed assets      1,181    18 
Right-of-use assets      127    - 
Other assets      36    - 
Total Assets      23,942    8,031 
Liabilities assumed             
Accounts payable and accrued expenses      25,210    3,115 
Other current liabilities      4,652    - 

Notes payable and other current liabilities, net of discount

      268    - 
Corporate taxes payable      -    31 
Long-term debt      -    7,721 
Contingent liabilities      14,583    - 
Lease liabilities      126    - 
       44,839    10,867 
Fair value of identifiable net liabilities acquired      (20,897)   (2,836)
              
Goodwill arising on acquisition:             
Cash consideration      1,800    6,096 
Shares issued      -    12 
Convertible preferred shares issued      95,609    - 
Notes assumed      15,669    - 
Consideration paid      110,078    6,108 
Add: fair value of identifiable net liabilities acquired      20,897    2,836 
              
Goodwill arising from transaction  (b)   133,975    8,944 

 

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Aditxt Inc.

Notes to Pro Forma Consolidated Financial Statements

(Unaudited)

(In thousands of U.S. dollars)

For the nine months ended September 30, 2024

 

4Preliminary Purchase Price Allocation (continued)

 

(a)A preliminary fair value estimate of $6,880 has been allocated to identifiable intangible assets acquired for the Appili Transaction. Intangibles assets acquired include licenses and intellectual property rights to the research and development activities of Appili, with a useful life of 15 years. The book value of Evofem’s intangible assets is assumed to approximate the fair value at the close of the acquisition.

 

(b)A preliminary estimate of $133,975 and $8,944 has been allocated to the goodwill for the Evofem Transaction and the Appili Transaction, respectively. Goodwill is calculated as the excess of the preliminary estimate of the acquisition date fair value of the consideration transferred, over the preliminary estimate of the fair values assigned to the identifiable assets acquired and liabilities assumed.

 

5Pro Forma Adjustments in Connection with the Transactions

 

The following summarizes the pro forma adjustments in connection with the Appili Transaction and the Evofem Transaction to give effect to the transactions as if they had occurred on January 1, 2023, for the purposes of the unaudited Pro Forma Consolidated Statement of Earnings and on September 30, 2024, for the purposes of the unaudited Pro Forma Consolidated Statement of Financial Position. The pro forma adjustments were based on preliminary estimates and assumptions that are subject to change.

 

(a) Cash

 

Reflects the pro forma adjustment to cash representing the sources and uses of cash to close the Transactions as if the Transactions had occurred on September 30, 2024. Sources and uses of cash include the $6,096 decrease for the preliminary purchase price paid for the Appili Transaction, $1,800 decrease for the preliminary purchase price paid for the Evofem Transaction, and an increase of $30,000 in proceeds from the issuance of common stock of Aditxt, net of issuance costs.

 

(b) Intangible Assets

 

An increase of $6,880 to the carrying value of Appili intangible assets to adjust it to its preliminary estimated fair value and an increase of $803 to the accumulated amortization. Intangibles assets acquired include licenses and intellectual property rights to research and development activities of Appili.

 

(c) Goodwill

 

Reflects an increase of $133,975 and $8,944 of goodwill as a result of the preliminary purchase price allocation of Evofem Transaction and Appili Transaction, respectively. Goodwill is not amortized and is not currently assumed to be deductible for tax purposes. Goodwill could materially change based on changes in estimates in the fair value of the assets acquired, and liabilities assumed.

 

11

 

 

Aditxt Inc.

Notes to Pro Forma Consolidated Financial Statements

(Unaudited)

(In thousands of U.S. dollars)

For the nine months ended September 30, 2024

 

5Pro Forma Adjustments in Connection with the Transactions (continued)

 

(d) Investment in Evofem

 

Reflects a decrease of $24,537 in Investment in Evofem for the elimination of cost of investment in Evofem on consolidation.

 

(e) Current Liabilities

 

Accounts payable and accrued expenses: Reflects an increase of $2,600 for transaction costs associated with Evofem Transaction and Appili Transaction.

 

Notes payable and other current liabilities - related party: Reflects a decrease of $685 for the elimination of inter-company balance on Evofem consolidation.

 

Convertible notes payable carried at fair value: Reflects a decrease of $14,183 to reflect the settlement of the notes in conjunction with the close of the transaction.

 

Convertible notes payable – Adjuvant: Reflects a decrease of $30,202 to reflect the settlement of the notes in conjunction with the close of the transaction.

 

Derivative liabilities: Reflects a decrease of $162 to reflect the settlement of the liability in conjunction with the close of the transaction.

 

(f) Mezzanine Equity

 

Convertible and redeemable preferred stock: Reflects an increase of $86,840 for the issuance of convertible preferred stock for the Evofem Transaction and $4,759 decrease on elimination of convertible preferred stock of Evofem on consolidation.

 

(g) Total Equity

 

Common stock: Reflects the elimination of $10 for the common stock of Evofem.

 

Additional paid-in capital:

 

Includes an increase to Aditxt for $30,000 capital, net of issuance costs to be raised in conjunction with the transactions. It also reflects an increase of $12 for the issuance of common stock in connection with the Appili Transaction, a $44,730 decrease on elimination of Appili paid-in-capital and a $825,430 decrease on elimination of Evofem paid-in-capital on consolidation.

 

Accumulated other comprehensive income (loss) adjustment: Reflects a decrease of $128 on elimination of currency translation adjustment on consolidation of Appili and an increase of $1,707 upon elimination of accumulated other comprehensive income (loss) of Evofem.

 

Accumulated deficit: Reflects a $894,522 and $54,573 decrease in accumulated deficit to eliminate historical retained loss of Evofem and Appili, respectively, $803 increase in cumulative amortization expense for intangible assets relating to Appili, and $2,600 increase for transaction costs associated with the Appili Transaction and Evofem Transaction.

 

12

 

 

Aditxt Inc.

Notes to Pro Forma Consolidated Financial Statements

(Unaudited)

(In thousands of U.S. dollars)

For the nine months ended September 30, 2024

  

(h) The unaudited Pro Forma Consolidated Statement of Earnings is also adjusted as follows:

 

Decrease other income (expense), net by $1,665 for the nine months ended September 30, 2024, to remove the interest related to notes that would have been extinguished as a requirement of the Evofem closing.

 

Increase amortization expense by $344 for amortization of the intangible assets recorded at fair value for the nine months ended September 30, 2024.

 

Decrease to loss on issuance of financial instruments of $3,300 for the nine months ended September 30, 2024 to remove the impact of issuances of purchase rights due to a down-round related to instruments that would have been extinguished as a requirement of the Evofem closing.

 

Decrease to gain on debt extinguishment of $977 for the nine months ended September 30, 2024 to remove the impact of the debt extinguishment related to an instrument that would have been extinguished as a requirement of the Evofem closing.

 

Decrease to change in fair value of financial instruments of $4,896 for the nine months ended September 30, 2024 to remove the impact of fair value adjustments related to instruments that would have been extinguished as a requirement of the Evofem closing.
   
 Decrease to implied dividend of $99 for the nine months ended September 30, 2024 on instruments that would have been extinguished as a requirement of the Evofem closing.

 

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