ENZ Enzo Biochem Inc

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

FORM 8-K/A

(Amendment No. 1)

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

 

Date of report (Date of earliest event reported): July 24, 2023

 

Enzo Biochem, Inc.

(Exact Name of Registrant as Specified in Its Charter)

 

New York

(State or Other Jurisdiction of Incorporation)

 

001-09974		13-2866202
(Commission File Number)		(IRS Employer Identification No.)
81 Executive Blvd. Suite 3
Farmingdale, New York		11735
(Address of Principal Executive Offices)		(Zip Code)

 

(212) 583-0100

(Registrant’s Telephone Number, Including Area Code) 

 

N/A

(Former Name 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:

 

☐	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))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of Each Class		Trading Symbol		Name of Each Exchange on Which Registered
Common Stock, $0.01 par value		ENZ		The New York Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-1 of this chapter). 

 

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. ☐

 

 

 

Introductory Note

 

 

Item 9.01. Financial Statements and Exhibits.

 

(b) Pro Forma Financial Information

 

This Current Report on Form 8-K provides the Company’s unaudited pro forma condensed consolidated financial information as of and for the nine months ended April 30, 2023 and for the years ended July 31, 2022 and July 31, 2021 and the notes thereto, based upon financial statements prepared in accordance with accounting principles generally accepted in the United States. Such information is filed as Exhibit 99.1 to this Current Report on Form 8-K.

 

(d) Exhibits

 

Exhibit		Exhibit Name
99.1		Unaudited Pro Forma Condensed Consolidated Financial Information of the Company.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	ENZO BIOCHEM, INC.
Date: July 28, 2023	By:	/s/ Hamid Erfanian
		Hamid Erfanian
		Chief Executive Officer

 

 

2

 

 

Exhibit 99.1

 

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION

 

(in thousands, except share and per share data)

 

The following unaudited pro forma condensed consolidated financial information is based upon the historical consolidated statements of Enzo Biochem, Inc., a New York corporation (the “Company”), adjusted to give effect to the sale (the “Asset Sale”) of substantially all the operating assets and assign certain liabilities of the Company’s clinical laboratory business (the “Business”) in accordance with the Asset Purchase Agreement dated March 16, 2023 (as amended, the “Asset Purchase Agreement”) between the Company, Enzo Clinical Labs, Inc., a New York corporation (the “Seller”), and Laboratory Corporation of America Holdings, a Delaware corporation (the “Buyer”). These unaudited pro forma condensed consolidated financial statements are derived from, and should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended July 31, 2022 filed with the United States Securities and Exchange Commission (the “SEC”) on October 14, 2022 as amended on November 24, 2022, and the Quarterly Report on Form 10-Q for the interim period ended April 30, 2023, filed with the SEC on June 14, 2023.

 

The unaudited pro forma condensed consolidated balance sheet gives effect to the Asset Sale as if it had occurred on April 30, 2023. The estimated cash proceeds and impact of the resulting gain are only included in the April 30, 2023 unaudited pro forma condensed consolidated balance sheet. The unaudited pro forma condensed consolidated statements of operations for the nine months ended April 30, 2023 and the years ended July 31, 2022 and 2021 give effect to the Asset Sale as if it had occurred on August 1, 2020.

 

The pro forma adjustments related to the sale of the Business are based on available information and assumptions that management believes are (1) directly attributable to the Asset Sale; (2) factually supportable; and (3) with respect to the unaudited pro forma condensed consolidated statements of operations, expected to have a continuing impact on consolidated operating results. Certain of the most significant assumptions are set forth under the Notes to Unaudited Pro Forma Condensed Consolidated Financial Information.

 

The unaudited pro forma condensed consolidated financial information is not necessarily indicative of the results of operations or financial position that might have been achieved for the dates or periods indicated, nor is it indicative of the results of operations or financial position that may occur in the future. Furthermore, the pro forma adjustments may differ from those that will be calculated for purposes of reporting discontinued operations in future filings. The Company cautions shareholders that its future results of operations, including uses of cash and financial position, may significantly differ from those described in these unaudited pro forma condensed consolidated financial statements, and accordingly, these unaudited pro forma condensed consolidated financial statements should be read in conjunction with the disclosures regarding the nature of the Company’s business following completion of the transactions contemplated by the Asset Purchase Agreement.

 

 

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
As of April 30, 2023
(in thousands, except share and per share data)

 

		Historical				Pro Forma Adjustments						Pro Forma
ASSETS
Current assets:
Cash and cash equivalents			2,632				104,700			(a)			107,332
Accounts receivable, net			9,636				—						9,636
Inventories, net			15,289				(6,988	)		(b)			8,301
Prepaid expenses and other current assets			4,442				(2,028	)		(b)			2,414
Total current assets			31,999				95,684						127,683
Property, plant, and equipment, net			17,506				(4,815	)		(b)			12,691
Right-of-use assets, net			13,457				(957	)		(b)			12,500
Goodwill			7,452				(7,452	)		(b)			—
Other, including restricted cash of $1,000			1,647				(272	)		(b)			1,375
Total assets		$	72,061			$	82,188					$	154,249
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable – trade		$	13,645			$	—					$	13,645
Accrued liabilities			17,494				1,632			(c)			19,126
Current portion of operating lease liabilities			3,706				(291	)		(b)			3,415
Mortgage debt, net			3,821				—						3,821
Loans payable, net			3,354										3,354
Other current liabilities and finance leases short term			132				—						132
Total current liabilities			42,152				1,341						43,493
Operating lease liabilities, non-current, net			10,734				(678	)		(b)			10,056
Long term debt, net			247				—						247
Total liabilities		$	53,133			$	663					$	53,796
Stockholders’ equity:
Common Stock, $.01 par value; authorized 75,000,000 shares; 49,669,488 shares issued and outstanding			496				—						496
Additional paid-in capital			342,055				—						342,055
Accumulated deficit			(325,780	)			81,525			(c)			(244,255	)
Accumulated other comprehensive income			2,157				—						2,157
Total stockholders’ equity			18,928				81,525						100,453
Total liabilities and stockholders’ equity		$	72,061			$	82,188					$	154,249

  

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

 

 

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the nine months ended April 30, 2023
(in thousands, except share and per share data)

 

		Historical				Pro Forma Adjustments						Pro Forma
Revenues		$	50,721			$	(28,619	)		(d)		$	22,102
Operating costs and expenses:
Cost of revenues			44,219				(30,538	)		(d)			13,681
Research and development			3,402				(694	)		(d)			2,708
Selling, general and administrative			35,285				(19,830	)		(d)			15,455
Legal and related expense, net			6,352				(192	)		(d)			6,160
Total operating costs and expenses			89,258				(51,254	)					38,004
Operating loss			(38,537	)			22,635						(15,902	)
Other income (expense):
Interest, net			95				4			(d)			99
Other			278				(16	)		(d)			262
Foreign exchange gain			1,022				—						1,022
Total other income (expense)			1,395				(12	)					1,383
Loss before income taxes			(37,142	)			22,623						(14,519	)
Income taxes			—				—						—
Net loss		$	(37,142	)		$	22,623					$	(14,519	)
Net loss per common share:
Basic and diluted		$	(0.76	)								$	(0.30	)
Weighted average common shares outstanding:
Basic and diluted			48,944										48,944

 

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

 

 

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the year ended July 31, 2022
(in thousands, except share and per share data)

 

		Historical				Pro Forma Adjustments						Pro Forma
Revenues		$	107,071			$	(74,428	)		(d)		$	32,643
Operating costs and expenses:
Cost of revenues			65,104				(45,891	)		(d)			19,213
Research and development			3,767				(1,329	)		(d)			2,438
Selling, general and administrative			48,018				(26,173	)		(d)			21,845
Legal and related expense, net			5,689				(254	)		(d)			5,435
Legal settlements			(500	)									(500	)
Total operating costs and expenses			122,078				(73,647	)					48,431
Operating loss			(15,007	)			(781	)					(15,788	)
Other income (expense):
Interest, net			159				19			(d)			178
Other			(1,191	)			(77	)		(d)			(1,268	)
Foreign exchange loss			(2,222	)			—						(2,222	)
Total other expense			(3,254	)			(58	)					(3,312	)
Loss before income taxes			(18,261	)			(839	)					(19,100	)
Income taxes			—				—						—
Net loss		$	(18,261	)		$	(839	)				$	(19,100	)
Net loss per common share:
Basic and diluted		$	(0.38	)								$	(0.39	)
Weighted average common shares outstanding:
Basic and diluted			48,594										48,594

 

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

 

 

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
For the year ended July 31, 2021
(in thousands, except share and per share data)

 

		Historical				Pro Forma Adjustments						Pro Forma
Revenues		$	117,731			$	(86,984	)		(d)		$	30,747
Operating costs and expenses:
Cost of revenues			64,154				(48,179	)		(d)			15,975
Research and development			3,252				(615	)		(d)			2,637
Selling, general and administrative			44,905				(26,028	)		(d)			18,877
Legal and related expense, net			4,728				(264	)		(d)			4,464
Total operating costs and expenses			117,039				(75,086	)					41,953
Operating income (loss)			692				(11,898	)					(11,206	)
Other income (expense):
Interest, net			8				17			(d)			25
Other			6,905				18			(d)			6,923
Foreign exchange (loss) gain			270				—						270
Total other income			7,183				35						7,218
Income (loss) before income taxes			7,875				(11,863	)					(3,988	)
Income taxes			—				—						—
Net income (loss)		$	7,875			$	(11,863	)				$	(3,988	)
Net income (loss) per common share:
Basic		$	0.16									$	(0.08	)
Diluted		$	0.16									$	(0.08	)
Weighted average common shares outstanding:
Basic			48,191										48,191
Diluted			48,325										48,191

 

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

 

 

NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION

 

(in thousands, except share and per share data)

 

1. Asset Sale

 

On March 16, 2023, Enzo Biochem, Inc., a New York corporation (the “Company”), Enzo Clinical Labs, Inc., a New York corporation (the “Seller”) entered into an Asset Purchase Agreement (as amended, the “Asset Purchase Agreement”) with Laboratory Corporation of America Holdings, a Delaware corporation (the “Buyer”). Pursuant to the Asset Purchase Agreement, the Seller agreed to sell substantially all the operating assets and assign certain liabilities of its clinical laboratory business (the “Business”) to the Buyer in exchange for approximately $113.25 million in cash, on and subject to the terms and conditions set forth therein (such transaction, the “Asset Sale”). On July 24, 2023, pursuant to the terms of the Asset Purchase Agreement, the Asset Sale closed. The purchase price remains subject to adjustment pursuant to the terms of the Asset Purchase Agreement.

 

2. Unaudited Pro Forma Adjustments

 

The preparation of the unaudited pro forma consolidated financial information is based on financial statements prepared in accordance with accounting principles generally accepted in the United States. The pro forma adjustments reflected in the accompanying unaudited pro forma consolidated financial information reflect estimates and assumptions that we believe to be directly attributable to the Asset Sale and factually supportable. Actual results may differ from those estimates.

 

The unaudited pro forma consolidated financial information is provided for illustrative purposes only and does not purport to represent what the actual results of operations would have been had the Asset Sale occurred on the respective dates assumed, nor is it necessarily indicative of our future operating results. The unaudited pro forma consolidated financial information and the accompanying unaudited notes should be read in conjunction with our consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the year ended July 31, 2022 filed with the SEC on October 14, 2022 as amended on November 24, 2022, and the Quarterly Report on Form 10-Q for the interim period ended April 30, 2023, filed with the SEC on June 14, 2023.

 

The pro forma adjustments are based on the Company’s preliminary estimates and assumptions which are subject to change. The following pro forma adjustments, related to the Asset Sale, are included in the unaudited pro forma condensed consolidated balance sheet and/or the unaudited pro forma condensed consolidated statements of operations.

 

 

(a)

Represents cash proceeds under the terms of the Asset Purchase Agreement of $113.25 million (subject to certain adjustments and assuming full release of the $5.0 million placed into an escrow account for the purpose of satisfying claims, if any, made by Buyer pursuant to the indemnification provisions included in the Asset Purchase Agreement), net of transaction-related expenses of $8.6 million. Estimated transaction-related expenses are summarized as follows (amounts in thousands):

 

Banker success fees and expenses		$	3,075
Legal and accounting fees			2,700
Contingent transaction bonuses			2,775
		$	8,550

  

(b)

Represents transfer of assets to the Buyer and the assumption of liabilities by the Buyer under the terms of the Asset Purchase Agreement.

 

(c)

The overall adjustment to accumulated deficit represents the estimated after-tax gain on the sale of the assets of $81.5 million, which is calculated as follows (amounts in thousands):

 

Cash purchase price		$	113,250
Less estimated transaction-related expenses			8,550
Net proceeds			104,700
Less net assets sold under the Asset Purchase Agreement			21,543
Less estimated income taxes			1,632
After-tax gain on sale of assets		$	81,525

  

The actual after-tax gain will be a different amount. Management expects to utilize substantially all of the Company’s historical tax attributes to offset a substantial portion of its taxable income arising from the Asset Sale. The estimated income taxes resulting from the Asset Sale are reflected as an adjustment to the accrued liabilities in the unaudited pro forma condensed consolidated balance sheet; however, the estimated after-tax gain on the Asset Sale has not been reflected in the unaudited pro forma condensed consolidated statements of operations as it is considered to be nonrecurring in nature.

 

(d)

Represents the elimination of Revenue, Cost of Revenue, Research and Development, Selling, General and Administrative, Legal Fee Expense, and Other Income related to the Business for the periods presented. These adjustments have no effect on the Company’s income taxes for all periods presented based on the Company being in a loss position with a full valuation allowance.

 

 

v3.23.2

Cover	Jul. 24, 2023
Cover [Abstract]
Document Type	8-K/A
Amendment Flag	true
Amendment Description	This Form 8-K/A Amendment No. 1 amends the Current Report on Form 8-K of Enzo Biochem, Inc. (the “Company”), filed on July 24, 2023, regarding our sale of certain assets and assignment of certain liabilities of the Company’s clinical laboratory business. The sole purpose of this amendment is to provide the pro forma financial information required by Item 9.01.
Document Period End Date	Jul. 24, 2023
Entity File Number	001-09974
Entity Registrant Name	Enzo Biochem, Inc.
Entity Central Index Key	0000316253
Entity Tax Identification Number	13-2866202
Entity Incorporation, State or Country Code	NY
Entity Address, Address Line One	81 Executive Blvd. Suite 3
Entity Address, City or Town	Farmingdale
Entity Address, State or Province	NY
Entity Address, Postal Zip Code	11735
City Area Code	212
Local Phone Number	583-0100
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	ENZ
Security Exchange Name	NYSE
Entity Emerging Growth Company	false

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