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): December 15, 2020
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 December 15, 2020, PURE Bioscience, Inc. (the “Company”) issued a press release announcing financial results for the fiscal quarter ended October 31, 2020 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 December 15, 2020. |
|---|---|
| * | 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> December 15, 2020 | By: | /s/ Tom Y. Lee |
| Tom<br> Y. Lee | ||
| Chief<br> Executive Officer |
EXHIBITINDEX
| Exhibit<br><br> Number | Description |
|---|---|
| 99.1 | Press Release, dated December 15, 2020. |
Exhibit99.1
PUREBioscience Reports Fiscal First Quarter 2021
FinancialResults
Updateon Business Segments and PURE’s SDC-Based Antimicrobial Food Safety Solutions
RANCHO CUCAMONGA, CA (December 15, 2020) – PURE Bioscience, Inc. (OTCQB: PURE), creator of the patented non-toxic silver dihydrogen citrate (SDC) antimicrobial, today reported financial results for the fiscal first quarter ended October 31, 2020.
Summaryof Results – Fiscal First Quarter Operations
| ● | Net<br> product sales for the fiscal first quarter ended October 31, 2020 increased 256% to 1,417,000, compared to $398,000 for the<br> fiscal first quarter ended October 31, 2019. The increase of $1,019,000 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> first quarter ended October 31, 2020, we recognized $174,000 in royalties from a nonexclusive third-party distributor. |
|---|---|
| ● | Net<br> loss for the fiscal first quarter ended October 31, 2020 was $180,000, compared to $1.1 million for the fiscal first quarter<br> ended October 31, 2019. Net income, excluding share-based compensation, for the fiscal first quarter ended October 31, 2020<br> was $49,000, compared to a net loss of $667,000 for the fiscal first quarter ended October 31, 2019. |
| ● | Net<br> loss per share was ($0.00) for the fiscal first quarter ended October 31, 2020, compared to a net loss of ($0.01) for the<br> fiscal first quarter ended October 31, 2019. |
| ● | Gross<br> margin as a percentage of net product sales was 55% and 61% for the first fiscal quarter ended October 31, 2020 and 2019,<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 first quarter ended October 31, 2020, compared to the fiscal<br> first quarter ended October 31, 2019. |
BusinessUpdate
| ● | PURE®<br> Hard Surface |
|---|---|
| ○ | Food<br> Processing and Manufacturing: Our distribution network is now servicing hundreds of protein, produce, bakery and dairy facilities<br> across the U.S. By working in tandem with our distributors, we have expanded our existing regional network addressing various<br> food safety solutions. In addition, applications are underway addressing new opportunities in the dairy and fresh produce<br> industry. |
| --- | --- |
| ○ | Food<br> Transportation Sanitization: PURE’s Transport Sanitation Solution, designed to meet the FDA Food Safety Modernization<br> Act (FSMA) requirements, added multiple food transportation companies as users, including the three major companies in the<br> channel, for a total of six of the nation’s largest food transportation companies servicing restaurant chains, food<br> processors and grocery store chains. This proven solution is now being adopted by processors and restaurant chains nationally. |
| ○ | Janitorial<br> and Cleaning: Our janitorial and cleaning distributors have continued servicing numerous federal and municipal facilities,<br> as well as school districts and universities across the country. We have made great in-roads in this channel with the help<br> of our regional distributors as part of a national push to provide superior efficacy with an EPA-approved, no-rinse disinfectant. |
| ○ | PURE<br> Hard Surface is now listed on the GSA AbilityOne Program, the program in which the federal government procures goods and services<br> from companies that provide employment opportunities to individuals with disabilities. National Industries for the Blind (NIB)<br> sponsored the inclusion of PURE Hard Surface in the program. Our partner, Lighthouse for the Blind and Visually Impaired San<br> Francisco, is in the final stages of constructing a facility in the San Francisco Bay Area that will package PURE’s<br> products and create jobs for the blind, thus meeting the AbilityOne Program’s requirements. Multiple government agencies,<br> including the Federal Aviation Administration (FAA), have started purchasing PURE’s products through the AbilityOne<br> Program. |
| ● | PURE<br> Control® |
| --- | --- |
| ○ | USDA-ARS<br> (United States Department of Agriculture – Agricultural Research Service) published its research validating the work<br> done by SmartWash Solutions® and PURE last year on efficacy on fresh-cut lettuce. An independent publication from SmartWash<br> Solutions® stated, “This novel application and chemistry have been tested commercially and is now available to the<br> fresh-cut market today on iceberg and romaine lettuces. This tool provides the additional incremental lethality needed to<br> drastically reduce the potential for food-borne illness when coupled with SmartWash Solutions’® industry-leading<br> wash system. This is a huge win for companies seeking to prevent recalls, protect their brand and assure consumer trust and<br> safety.” |
| --- | --- |
| ○ | 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, “While our fiscal Q1 results showed increased year-over-year sales growth, we did see a decrease compared to fiscal Q4 of last year. The order restocking process slowed in fiscal Q1 vs Q4 of last year due to the volume of sales recognized toward the end of fiscal Q4.
“We continue to view the commercialization of SmartWash and the progress being made by our PURE Hard Surface partners and distributors as great near-term revenue opportunities. Additionally, I’m pleased to announce another nationally-recognized quick-service restaurant has adopted our SDC technology to help mitigate food safety risks,” 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 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, plans, business outlook or future performance, and any other statements concerning assumptionsmade or expectations as to any future events, conditions, performance or other matters, are “forward-looking statements.”Forward-looking statements inherently involve risks and uncertainties that could cause our actual results to differ materiallyfrom any forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to,the Company’s failure to implement or otherwise achieve the benefits of its proposed business initiatives and plans; economicand other disruptions resulting from COVID-19; acceptance of the Company’s current and future products and services in themarketplace, including the Company’s ability to convert successful evaluations and tests for PURE Control and PURE HardSurface into customer orders and customers continuing to place product orders as expected and to expand their use of the Company’sproducts; the Company’s ability to maintain relationships with its partners and other counterparties; the Company’sability to generate sufficient revenues and reduce its operating expenses in order to reach profitability; the Company’sability to raise the funding required to support its continued operations and the implementation of its business plan; the abilityof the Company to develop effective new products and receive required regulatory approvals for such products, including the requireddata and regulatory approvals required to use its SDC-based technology as a direct food contact processing aid in raw meat processingand to expand its use in OLR poultry processing; competitive factors, including customer acceptance of the Company’s SDC-basedproducts that are typically more expensive than existing treatment chemicals; dependence upon third-party vendors, including tomanufacture its products; and other risks detailed in the Company’s periodic report filings with the Securities and ExchangeCommission (the SEC), including its Form 10-K for the fiscal year ended July 31, 2020 and Form 10-Q for the first fiscal quarterended October 31, 2020. You should not place undue reliance on these forward-looking statements, which speak only as of the dateof this 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<br> 31, 2020 | |||||
|---|---|---|---|---|---|
| (Unaudited) | |||||
| Assets | |||||
| Current<br> assets | |||||
| Cash<br> and cash equivalents | 3,466,000 | $ | 3,839,000 | ||
| Accounts<br> receivable | 560,000 | 1,089,000 | |||
| Inventories,<br> net | 733,000 | 547,000 | |||
| Restricted<br> cash | 75,000 | 75,000 | |||
| Prepaid<br> expenses | 46,000 | 16,000 | |||
| Total<br> current assets | 4,880,000 | 5,566,000 | |||
| Property,<br> plant and equipment, net | 465,000 | 316,000 | |||
| Patents,<br> net | 421,000 | 441,000 | |||
| Total<br> assets | 5,766,000 | $ | 6,323,000 | ||
| Liabilities<br> and stockholders’ equity | |||||
| Current<br> liabilities | |||||
| Accounts<br> payable | 773,000 | $ | 1,344,000 | ||
| Accrued<br> liabilities | 133,000 | 168,000 | |||
| Total<br> current liabilities | 906,000 | 1,512,000 | |||
| Commitments<br> and contingencies | |||||
| Stockholders’<br> equity | |||||
| Preferred<br> stock, 0.01 par value: 5,000,000 shares authorized, no shares issued and outstanding | — | — | |||
| Common<br> stock, 0.01 par value: 100,000,000 shares authorized, 87,072,951 shares issued and outstanding at October 31, 2020, and at<br> July 31, 2020 | 871,000 | 871,000 | |||
| Additional<br> paid-in capital | 127,643,000 | 127,414,000 | |||
| Accumulated<br> deficit | (123,654,000 | ) | (123,474,000 | ) | |
| Total<br> stockholders’ equity | 4,860,000 | 4,811,000 | |||
| Total<br> liabilities and stockholders’ equity | 5,766,000 | $ | 6,323,000 |
All values are in US Dollars.
PUREBioscience, Inc.
CondensedConsolidated Statements of Operations
(Unaudited)
| Three<br> months ended | ||||||
|---|---|---|---|---|---|---|
| October<br> 31, | ||||||
| 2020 | 2019 | |||||
| Net<br> product sales | $ | 1,417,000 | $ | 398,000 | ||
| Royalty<br> revenue | 174,000 | — | ||||
| Total<br> revenue | 1,591,000 | 398,000 | ||||
| Cost<br> of goods sold | 641,000 | 156,000 | ||||
| Gross<br> Profit | 950,000 | 242,000 | ||||
| Operating<br> costs and expenses | ||||||
| Selling,<br> general and administrative | 1,046,000 | 1,290,000 | ||||
| Research<br> and development | 83,000 | 82,000 | ||||
| Total<br> operating costs and expenses | 1,129,000 | 1,372,000 | ||||
| Loss<br> from operations | (179,000 | ) | (1,130,000 | ) | ||
| Other<br> income (expense) | ||||||
| Interest<br> expense, net | (1,000 | ) | (2,000 | ) | ||
| Other<br> income, net | — | 7,000 | ||||
| Total<br> other income (expense) | (1,000 | ) | 5,000 | |||
| Net<br> loss | $ | (180,000 | ) | $ | (1,125,000 | ) |
| Basic<br> and diluted net loss per share | $ | (0.00 | ) | $ | (0.01 | ) |
| Shares<br> used in computing basic and diluted net loss per share | 87,072,951 | 78,004,073 |
PUREBioscience, Inc.
CondensedConsolidated Statement of Stockholders’ Equity
(Unaudited)
| Common<br> Stock | Additional<br><br> Paid-In | Accumulated | Total<br><br> Stockholders’ | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Shares | Amount | Capital | Deficit | Equity | |||||||||
| Balance<br> July 31, 2020 | 87,072,951 | $ | 871,000 | $ | 127,414,000 | $ | (123,474,000 | ) | $ | 4,811,000 | |||
| Share-based<br> compensation expense - stock options | — | — | 208,000 | — | 208,000 | ||||||||
| Share-based<br> compensation expense - restricted stock units | — | — | 21,000 | — | 21,000 | ||||||||
| Net<br> loss | — | — | — | (180,000 | ) | (180,000 | ) | ||||||
| Balance October<br> 31, 2020 (Unaudited) | 87,072,951 | $ | 871,000 | $ | 127,643,000 | $ | (123,654,000 | ) | $ | 4,860,000 | |||
| Common<br> Stock | Additional<br><br> Paid-In | Accumulated | Total<br><br> Stockholders’ | ||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
| Shares | Amount | Capital | Deficit | Equity | |||||||||
| Balance<br> July 31, 2019 | 76,732,334 | $ | 768,000 | $ | 123,900,000 | $ | (123,478,000 | ) | $ | 1,190,000 | |||
| Issuance<br> of common stock in private placements, net | 2,862,068 | 28,000 | 802,000 | — | 830,000 | ||||||||
| Share-based<br> compensation expense - stock options | — | — | 268,000 | — | 268,000 | ||||||||
| Share-based<br> compensation expense - restricted stock units | — | — | 190,000 | — | 190,000 | ||||||||
| Issuance<br> of common stock for vested restricted stock units | 400,000 | 4,000 | (4,000 | ) | — | — | |||||||
| Net<br> loss | — | — | — | (1,125,000 | ) | (1,125,000 | ) | ||||||
| Balance October<br> 31, 2019 (Unaudited) | 79,994,402 | $ | 800,000 | $ | 125,156,000 | $ | (124,603,000 | ) | $ | 1,353,000 |
PUREBioscience, Inc.
CondensedConsolidated Statements of Cash Flows
(Unaudited)
| Three<br> Months Ended | ||||||
|---|---|---|---|---|---|---|
| October<br> 31, | ||||||
| 2020 | 2019 | |||||
| Operating<br> activities | ||||||
| Net<br> loss | $ | (180,000 | ) | $ | (1,125,000 | ) |
| Adjustments<br> to reconcile net loss to net cash used in operating activities: | ||||||
| Share-based<br> compensation | 229,000 | 458,000 | ||||
| Amortization<br> of stock issued for services | — | 4,000 | ||||
| Depreciation<br> and amortization | 45,000 | 52,000 | ||||
| Changes<br> in operating assets and liabilities: | ||||||
| Accounts<br> receivable | 529,000 | 153,000 | ||||
| Inventories | (186,000 | ) | 15,000 | |||
| Prepaid<br> expenses | (30,000 | ) | (16,000 | ) | ||
| Accounts<br> payable and accrued liabilities | (606,000 | ) | 139,000 | |||
| Deferred<br> rent | — | (4,000 | ) | |||
| Net<br> cash used in operating activities | (199,000 | ) | (324,000 | ) | ||
| Investing<br> activities | ||||||
| Purchases<br> of property, plant and equipment | (174,000 | ) | — | |||
| Net<br> cash used in investing activities | (174,000 | ) | — | |||
| Financing<br> activities | ||||||
| Net<br> proceeds from the sale of common stock | — | 830,000 | ||||
| Net<br> cash provided by financing activities | — | 830,000 | ||||
| Net<br> increase (decrease) in cash, cash equivalents, and restricted cash | (373,000 | ) | 506,000 | |||
| Cash,<br> cash equivalents, and restricted cash at beginning of period | 3,914,000 | 473,000 | ||||
| Cash,<br> cash equivalents, and restricted cash at end of period | $ | 3,541,000 | $ | 979,000 | ||
| Reconciliation<br> of cash, cash equivalents, and restricted cash to the condensed consolidated balance sheets | ||||||
| Cash<br> and cash equivalents | $ | 3,466,000 | $ | 904,000 | ||
| Restricted<br> cash | $ | 75,000 | $ | 75,000 | ||
| Total<br> cash, cash equivalents and restricted cash | $ | 3,541,000 | $ | 979,000 |