8-K
PURE BIOSCIENCE, INC. (PURE)
UNITEDSTATES
SECURITIESAND EXCHANGE COMMISSION
WASHINGTON,D.C. 20549
FORM8-K
CURRENTREPORT
Pursuantto Section 13 or 15(d)
ofthe Securities Exchange Act of 1934
Dateof Report (Date of earliest event reported): March 15, 2021
PUREBIOSCIENCE, INC.
(Exactname of registrant as specified in its charter)
| Delaware | 001-14468 | 33-0530289 |
|---|---|---|
| (State or other jurisdiction<br><br> of incorporation) | (Commission<br><br> File Number) | (IRS Employer<br><br> Identification No.) |
| 9669 Hermosa Avenue<br><br> Rancho Cucamonga, California | 91730 | |
| --- | --- | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’stelephone number, including area code: (619) 596-8600
Notapplicable
(Formername or former address, if changed since last report)
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 (see General Instruction A.2. below):
| [ ] | Written<br> communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| [ ] | Soliciting<br> material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| [ ] | Pre-commencement<br> communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| [ ] | Pre-commencement<br> communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act: None
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company [ ]
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
Item2.02. Results of Operations and Financial Condition.
On March 15, 2021, PURE Bioscience, Inc. (the “Company”) issued a press release announcing financial results for the fiscal quarter ended January 31, 2021 and related information. A copy of the press release is attached as Exhibit 99.1.
The information in this Item 2.02 is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that Section. The information in this Item 2.02 shall not be incorporated by reference into any registration statement or other document filed with the Securities and Exchange Commission.
Item9.01. Financial Statements and Exhibits.
(d) Exhibits
| 99.1 | Press Release, dated March 15, 2021. |
|---|---|
| * | Exhibit<br> 99.1 is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange<br> Act of 1934 or otherwise subject to the liabilities of that Section, nor shall it be incorporated by reference into any registration<br> statement or other document filed with the Securities and Exchange Commission. |
| --- | --- |
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.
| PURE BIOSCIENCE, INC. | ||
|---|---|---|
| Dated:<br> March 15, 2021 | By: | /s/ Tom Y. Lee |
| Tom<br> Y. Lee | ||
| Chief<br> Executive Officer |
Exhibit99.1
PUREBioscience Reports Fiscal 2021 Second Quarter
AndSix-Month Financial Results
Updateon Business Segments and PURE’s SDC-Based Antimicrobial Food Safety Solutions
RANCHO CUCAMONGA, CA (March 15, 2021) – PURE Bioscience, Inc. (OTCQB: PURE), creator of the patented non-toxic silver dihydrogen citrate (SDC) antimicrobial, today reported financial results for the fiscal second quarter and six-month period ended January 31, 2021.
Q2:Summary of Results of Operations
| ● | Net<br> product sales for the fiscal second quarter ended January 31, 2021 increased 149% to $868,000, compared to $349,000 for the<br> fiscal second quarter ended January 31, 2020. The increase of $519,000 was attributable to increased sales across our distribution<br> and end-user network servicing the food processing, transportation and janitorial industry. In addition, during the fiscal<br> second quarter ended January 31, 2021, we recognized $48,000 in royalties from a nonexclusive third-party distributor. |
|---|---|
| ● | Net<br> loss for the fiscal second quarter ended January 31, 2021 was $595,000, compared to $666,000 for the fiscal second quarter<br> ended January 31, 2020. Net loss, excluding share-based compensation, for the fiscal second quarter ended January 31, 2021<br> was $354,000, compared to $577,000 for the fiscal second quarter ended January 31, 2020. |
| ● | Net<br> loss per share was ($0.01) for the fiscal second quarters ended January 31, 2021 and 2020, respectively. |
| ● | Gross<br> margin as a percentage of net product sales was 58% and 59% for the fiscal second quarters ended January 31, 2021 and 2020,<br> respectively. The decrease in gross margin percentage was primarily attributable to the sale of lower-margin formulations<br> and packaging configurations of our products during the fiscal second quarter ended January 31, 2021, compared to the fiscal<br> second quarter ended January 31, 2020. |
SixMonths: Summary of Results of Operations
| ● | Net<br> product sales for the six months ended January 31, 2021 increased 206% to $2,285,000, compared to $747,000 for the six months<br> ended January 31, 2020. The increase of $1,538,000 was attributable to increased sales across our distribution and end-user<br> network servicing the food processing, transportation and janitorial industry. In addition, during the six months ended January<br> 31, 2021, we recognized $222,000 in royalties from a nonexclusive third-party distributor. |
|---|---|
| ● | Net<br> loss for the six months ended January 31, 2021 was $775,000, compared to $1,791,000 for the six months ended January 31, 2020.<br> Net loss, excluding share-based compensation, for the six months ended January 31, 2021 was $305,000, compared to $1,244,000<br> for the six months ended January 31, 2020. |
| ● | Net<br> loss per share was ($0.01) for the six months ended January 31, 2021 and ($0.02) for the six months ended January 31, 2020. |
| ● | Gross<br> margin as a percentage of net product sales was 56% and 60% for the six months ended January 31, 2021 and 2020, respectively.<br> The decrease in gross margin percentage was primarily attributable to the sale of lower-margin formulations and packaging<br> configurations of our products during the six months ended January 31, 2021, compared to the six months ended January 31,<br> 2020. |
BusinessUpdate
| ● | PURE^®^Hard Surface |
|---|---|
| ○ | During<br> the fiscal second quarter our network has continued to grow, especially in the produce and dairy segments. Several new fresh<br> produce companies have started using PURE Hard Surface in their processing and harvesting operations. Our strong relationship<br> with the leading distributor and supplier to the U.S. dairy industry is leading to new sanitization practices in this segment,<br> allowing PURE Hard Surface to be a recognized solution for food safety in the channel. |
| --- | --- |
| ○ | PURE’s<br> Transport Sanitation Solution continues to gain adoption in large food retail operations, quick serve restaurant and restaurant<br> chains. The system allows companies to meet the FDA Food Safety Modernization Act (FSMA) requirements with less labor and<br> water usage than current industry practices. |
| ○ | Our<br> janitorial and cleaning distributors continue servicing numerous federal and municipal facilities, as well as school districts,<br> universities and churches across the country. We look forward to providing enhanced safety for students and staff when schools<br> reopen. |
| ○ | In<br> February, the Government Supply Administration (GSA) listed PURE Hard Surface on the AbilityOne Program, the program in which<br> federal agencies procure goods and services from companies that provide employment opportunities to individuals with disabilities.<br> Under program rules, agencies procuring goods and services must purchase from companies whose goods and services are listed<br> on the AbilityOne program. Beginning in June, agencies that wish to purchase surface sanitizer/disinfectant products will<br> thus be required to purchase PURE Hard Surface, the only sanitizer/disinfectant listed on the AbilityOne program that is EPA<br> Category IV (lowest toxicity and irritant level), has the shortest kill times and requires no rinse even on food contact surfaces.<br> Our partners, Lighthouse for the Blind and Visually Impaired, began operating in March a state-of-the-art bottling facility<br> that will provide jobs for blind and visually impaired employees. PURE Bioscience will continue to work closely with our partners<br> to drive sales into this segment. |
| ○ | The<br> Federal Aviation Administration (FAA) approved and adopted the use of PURE Hard Surface in all their control towers, control<br> centers and radar centers across the country. Based on a recently completed pilot study, the FAA’s janitorial service<br> protocols now require the use of PURE Hard Surface on a daily basis. The most critical facilities adopted this protocol with<br> 85 current FAA airport locations being disinfected daily with PURE Hard Surface. |
| ● | PURE<br> Control^®^ |
| --- | --- |
| ○ | PURE<br> Bioscience and Smart Wash Solutions continue to move toward adoption and use of PURE Control in chopped and shredded leafy<br> greens. PURE Control’s increased efficacy, which has been validated by the United States Department of Agriculture,<br> was integral to these efforts. |
| --- | --- |
| ○ | PURE<br> Control is now being used to treat pre-cut lettuce, berries and tomatoes at various locations. Expansion has continued to<br> other seasonal growing locations in the U.S. across several processors. |
| ○ | We<br> continue to work with several processors to use PURE Control to enhance the protection of fruit, herbs, onions, broccoli and<br> other processed vegetables. |
Tom Y. Lee, Chief Executive Officer, said that, “Our net product sales have continued to increase in comparison to last year’s pre-pandemic numbers. We are now seeing reorders in the janitorial/sanitation channel as many of our distributors have worked through inventory purchased during the pandemic.
“We are pleased that the FAA has continued to expanded use, which will only increase as air travel picks up. The vetting process for this approval was strict and PURE Hard Surface was fully adopted. In addition, we have continued to work alongside SmartWash Solutions toward the full commercialization and rollout of PURE Control/Smart Wash Boost to provide new levels of fresh produce safety,” concluded Lee.
AboutPURE Bioscience, Inc.
PURE Bioscience, Inc. is focused on developing and commercializing our proprietary antimicrobial products primarily in the food safety arena. We provide solutions to combat the health and environmental challenges of pathogen and hygienic control. Our technology platform is based on patented, stabilized ionic silver, and our initial products contain silver dihydrogen citrate, better known as SDC. This is a broad-spectrum, non-toxic antimicrobial agent, which offers 24-hour residual bacterial protection and formulates well with other compounds. As a platform technology, SDC is distinguished from existing products in the marketplace because of its superior efficacy, reduced toxicity and mitigation of bacterial resistance. PURE is headquartered in Rancho Cucamonga, California (San Bernardino metropolitan area). Additional information on PURE is available at www.purebio.com
Forward-lookingStatements: Any statements contained in this press release that do not describe historical facts may constitute forward-lookingstatements as that term is defined in the Private Securities Litigation Reform Act of 1995. Statements in this press release concerningthe Company’s expectations (including with respect to SmartWash and FAA), plans, business outlook or future performance,and any other statements concerning assumptions made or expectations as to any future events, conditions, performance or othermatters, are “forward-looking statements.” Forward-looking statements inherently involve risks and uncertainties thatcould cause our actual results to differ materially from any forward-looking statements. Factors that could cause or contributeto such differences include, but are not limited to, the Company’s failure to implement or otherwise achieve the benefitsof its proposed business initiatives and plans; economic and other disruptions resulting from COVID-19; acceptance of the Company’scurrent and future products and services in the marketplace, including the Company’s ability to convert successful evaluationsand tests for PURE Control and PURE Hard Surface into customer orders and customers continuing to place product orders as expectedand to expand their use of the Company’s products; the Company’s ability to maintain relationships with its partnersand other counterparties; the Company’s ability to generate sufficient revenues and reduce its operating expenses in orderto reach profitability; the Company’s ability to raise the funding required to support its continued operations and theimplementation of its business plan; the ability of the Company to develop effective new products and receive required regulatoryapprovals for such products, including the required data and regulatory approvals required to use its SDC-based technology asa direct food contact processing aid in raw meat processing and to expand its use in OLR poultry processing; competitive factors,including customer acceptance of the Company’s SDC-based products that are typically more expensive than existing treatmentchemicals; dependence upon third-party vendors, including to manufacture its products; and other risks detailed in the Company’speriodic report filings with the Securities and Exchange Commission (the SEC), including its Form 10-K for the fiscal year endedJuly 31, 2020, Form 10-Q for the fiscal first quarter ended October 31, 2020 and Form 10-Q for the fiscal second quarter endedJanuary 31, 2021. You should not place undue reliance on these forward-looking statements, which speak only as of the date ofthis press release. By making these forward-looking statements, the Company undertakes no obligation to update these statementsfor revisions or changes after the date of this release.
Contact:
Mark Elliott, VP Finance
PURE Bioscience, Inc.
Ph: 619-596-8600 ext: 116
PUREBioscience, Inc.
CondensedConsolidated Balance Sheets
| July 31, 2020 | |||||
|---|---|---|---|---|---|
| (Unaudited) | |||||
| Assets | |||||
| Current assets | |||||
| Cash and cash equivalents | 2,927,000 | $ | 3,839,000 | ||
| Accounts receivable | 466,000 | 1,089,000 | |||
| Inventories, net | 618,000 | 547,000 | |||
| Restricted cash | 75,000 | 75,000 | |||
| Prepaid expenses | 29,000 | 16,000 | |||
| Total current assets | 4,115,000 | 5,566,000 | |||
| Property, plant and equipment, net | 771,000 | 316,000 | |||
| Patents, net | 400,000 | 441,000 | |||
| Total assets | 5,286,000 | $ | 6,323,000 | ||
| Liabilities and stockholders’ equity | |||||
| Current liabilities | |||||
| Accounts payable | 617,000 | $ | 1,344,000 | ||
| Accrued liabilities | 163,000 | 168,000 | |||
| Total current liabilities | 780,000 | 1,512,000 | |||
| Commitments and contingencies | |||||
| Stockholders’ equity | |||||
| Preferred stock, 0.01 par value: 5,000,000 shares authorized, no shares issued and outstanding | — | — | |||
| Common stock, 0.01 par value: 150,000,000 shares authorized, 87,223,141 shares issued and outstanding at January 31, 2021, and 87,072,951 shares issued and outstanding at July 31, 2020 | 873,000 | 871,000 | |||
| Additional paid-in capital | 127,882,000 | 127,414,000 | |||
| Accumulated deficit | (124,249,000 | ) | (123,474,000 | ) | |
| Total stockholders’ equity | 4,506,000 | 4,811,000 | |||
| Total liabilities and stockholders’ equity | 5,286,000 | $ | 6,323,000 |
All values are in US Dollars.
PUREBioscience, Inc.
CondensedConsolidated Statements of Operations
(Unaudited)
| Six Months Ended | Three months Ended | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| January 31, | January 31, | |||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||
| Net product sales | $ | 2,285,000 | $ | 747,000 | $ | 868,000 | $ | 349,000 | ||||
| Royalty revenue | 222,000 | — | 48,000 | — | ||||||||
| Total revenue | 2,507,000 | — | 916,000 | — | ||||||||
| Cost of goods sold | 1,004,000 | 298,000 | 363,000 | 142,000 | ||||||||
| Gross profit | 1,503,000 | 449,000 | 553,000 | 207,000 | ||||||||
| Operating costs and expenses | ||||||||||||
| Selling, general and administrative | 2,100,000 | 2,100,000 | 1,054,000 | 810,000 | ||||||||
| Research and development | 176,000 | 142,000 | 93,000 | 60,000 | ||||||||
| Total operating costs and expenses | 2,276,000 | 2,242,000 | 1,147,000 | 870,000 | ||||||||
| Loss from operations | (773,000 | ) | (1,793,000 | ) | (594,000 | ) | (663,000 | ) | ||||
| Other income (expense) | ||||||||||||
| Interest expense, net | (2,000 | ) | (3,000 | ) | (1,000 | ) | (1,000 | ) | ||||
| Other income (expense), net | — | 5,000 | — | (2,000 | ) | |||||||
| Total other income (expense) | (2,000 | ) | 2,000 | (1,000 | ) | (3,000 | ) | |||||
| Net loss | $ | (775,000 | ) | $ | (1,791,000 | ) | $ | (595,000 | ) | $ | (666,000 | ) |
| Basic and diluted net loss per share | $ | (0.01 | ) | $ | (0.02 | ) | $ | (0.01 | ) | $ | (0.01 | ) |
| Shares used in computing basic and diluted net loss per share | 87,126,279 | 78,999,237 | 87,179,607 | 79,994,402 |
PUREBioscience, Inc.
CondensedConsolidated Statement of Stockholders’ Equity
(Unaudited)
| Six<br> Months Ended January 31, 2021 | Six<br> Months Ended January 31, 2020 | |||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Common<br> Stock | Additional<br><br> Paid-In | Accumulated | Total<br><br> Stockholders’ | Common<br> Stock | Additional<br><br> Paid-In | Accumulated | Total<br><br> Stockholders’ | |||||||||||||||||||
| Shares | Amount | Capital | Deficit | Equity | Shares | Amount | Capital | Deficit | Equity | |||||||||||||||||
| Balances at beginning of period | 87,072,951 | $ | 871,000 | $ | 127,414,000 | $ | (123,474,000 | ) | $ | 4,811,000 | 76,732,334 | $ | 768,000 | $ | 123,900,000 | $ | (123,478,000 | ) | $ | 1,190,000 | ||||||
| Issuance of common stock<br> in private placements, net | — | — | — | — | — | 2,862,068 | 28,000 | 802,000 | — | 830,000 | ||||||||||||||||
| Share-based compensation<br> expense - stock options | — | — | 428,000 | — | 428,000 | — | — | 336,000 | — | 336,000 | ||||||||||||||||
| Share-based compensation<br> expense - restricted stock units | — | — | 42,000 | — | 42,000 | — | — | 211,000 | — | 211,000 | ||||||||||||||||
| Issuance of common stock<br> upon the exercise of stock options | 150,190 | 2,000 | (2,000 | ) | — | — | — | — | — | — | — | |||||||||||||||
| Issuance of common stock<br> for vested restricted stock units | — | — | — | — | — | 400,000 | 4,000 | (4,000 | ) | — | — | |||||||||||||||
| Net<br> loss | — | — | — | (775,000 | ) | (775,000 | ) | — | — | — | (1,791,000 | ) | (1,791,000 | ) | ||||||||||||
| Balances<br> at end of period (Unaudited) | 87,223,141 | $ | 873,000 | $ | 127,882,000 | $ | (124,249,000 | ) | $ | 4,506,000 | 79,994,402 | $ | 800,000 | $ | 125,245,000 | $ | (125,269,000 | ) | $ | 776,000 | ||||||
| Three<br> Months Ended January 31, 2021 | Three<br> Months Ended January 31, 2020 | |||||||||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | |
| Common<br> Stock | Additional<br><br> Paid-In | Accumulated | Total<br><br> Stockholders’ | Common<br> Stock | Additional<br><br> Paid-In | Accumulated | Total<br><br> Stockholders’ | |||||||||||||||||||
| Shares | Amount | Capital | Deficit | Equity | Shares | Amount | Capital | Deficit | Equity | |||||||||||||||||
| Balances<br> at beginning of period (Unaudited) | 87,072,951 | $ | 871,000 | $ | 127,643,000 | $ | (123,654,000 | ) | $ | 4,860,000 | 79,994,402 | $ | 800,000 | $ | 125,156,000 | $ | (124,603,000 | ) | $ | 1,353,000 | ||||||
| Share-based compensation<br> expense - stock options | — | — | 220,000 | — | 220,000 | — | — | 68,000 | — | 68,000 | ||||||||||||||||
| Share-based compensation<br> expense - restricted stock units | — | — | 21,000 | — | 21,000 | — | — | 21,000 | — | 21,000 | ||||||||||||||||
| Issuance of common stock<br> upon the exercise of stock options | 150,190 | 2,000 | (2,000 | ) | — | — | — | — | — | — | — | |||||||||||||||
| Net<br> loss | — | — | — | (595,000 | ) | (595,000 | ) | — | — | — | (666,000 | ) | (666,000 | ) | ||||||||||||
| Balances<br> at end of period (Unaudited) | 87,223,141 | $ | 873,000 | $ | 127,882,000 | $ | (124,249,000 | ) | $ | 4,506,000 | 79,994,402 | $ | 800,000 | $ | 125,245,000 | $ | (125,269,000 | ) | $ | 776,000 |
PUREBioscience, Inc.
CondensedConsolidated Statements of Cash Flows
(Unaudited)
| Six<br> Months Ended | **** | ||||
|---|---|---|---|---|---|
| January<br> 31, | **** | ||||
| 2021 | **** | 2020 | **** | ||
| Operating activities | |||||
| Net<br> loss | ) | $ | (1,791,000 | ) | |
| Adjustments<br> to reconcile net loss to net cash used in operating activities: | |||||
| Share-based<br> compensation | 547,000 | ||||
| Amortization<br> of stock issued for services | 4,000 | ||||
| Depreciation<br> and amortization | 100,000 | ||||
| Changes<br> in operating assets and liabilities: | |||||
| Accounts<br> receivable | 217,000 | ||||
| Inventories | ) | 36,000 | |||
| Prepaid<br> expenses | ) | (1,000 | ) | ||
| Accounts<br> payable and accrued liabilities | ) | (46,000 | ) | ||
| Deferred<br> rent | (4,000 | ) | |||
| Net<br> cash used in operating activities | ) | (938,000 | ) | ||
| Investing activities | |||||
| Purchases<br> of property, plant and equipment | ) | (44,000 | ) | ||
| Net<br> cash used in investing activities | ) | (44,000 | ) | ||
| Financing activities | |||||
| Net<br> proceeds from the sale of common stock | 830,000 | ||||
| Net<br> cash provided by financing activities | 830,000 | ||||
| Net<br> decrease in cash, cash equivalents, and restricted cash | ) | (152,000 | ) | ||
| Cash,<br> cash equivalents, and restricted cash at beginning of period | 473,000 | ||||
| Cash,<br> cash equivalents, and restricted cash at end of period | $ | 321,000 | |||
| Reconciliation of cash, cash equivalents, and restricted cash to the condensed consolidated balance sheets | |||||
| Cash<br> and cash equivalents | $ | 246,000 | |||
| Restricted<br> cash | $ | 75,000 | |||
| Total<br> cash, cash equivalents and restricted cash | $ | 321,000 | |||
| Supplemental<br> disclosure of non-cash activities | |||||
| Cash<br> paid for taxes | $ | 2,000 |
All values are in US Dollars.