Exhibit 99.5 

 

Unaudited Pro Forma Condensed Consolidated Financial Information

 

On January 26, 2021, Boston Therapeutics, Inc., a Delaware corporation (the “Company”), BTHE Acquisition Inc., a California corporation and wholly-owned subsidiary of the Company (“Merger Sub”), and Nanomix, Inc., a California corporation (“Nanomix”), entered into an Agreement and Plan of Merger (the “Merger Agreement”), pursuant to which, among other matters, and subject to the satisfaction or waiver of the conditions set forth in the Merger Agreement, Merger Sub will merge with and into Nanomix, with Nanomix continuing as a wholly-owned subsidiary of the Company and the surviving corporation of the merger (the “Merger”). The Merger is intended to qualify for federal income tax purposes as a tax-free reorganization under the provisions of Section 368(a) of the Internal Revenue Code of 1986, as amended. The merger closed on June 4, 2021.

 

The unaudited pro forma condensed combined financial information has been prepared to illustrate the effect of the Business Combination and has been prepared for informational purposes only.

 

The historical financial statements have been adjusted in the unaudited pro forma condensed combined financial information to give pro forma effect to events that are (1) directly attributable to the Business Combination, (2) factually supportable, and (3) with respect to the statements of operations, expected to have a continuing impact on the results of the post-combination company. No pro forma adjustments were required to eliminate activities between the companies.

 

The pro forma basic and diluted earnings per share amounts presented in the unaudited pro forma condensed combined statements of operations are based upon the number of the post combination shares outstanding assuming the Business Combination occurred on January 1, 2020 and 2019.

 

 

 

 

UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET AS OF MARCH 31, 2021 AND DECEMBER 31, 2020

 

   Boston Therapeutics   Nanomix, Inc   Proforma Adjustment   Combined 
   March 31,
 2021
   December, 31
2020
   March 31,
2021
   December, 31
2020
   March 31,
 2021
   December, 31
2020
   March 31,
 2021
   December, 31
2020
 

ASSETS 

                                
Currents assets:                                
Cash  $46,964   $7,402   $66,490   $15,098             $113,454   $22,500 
Accounts receivable   -    -    -    821              0    821 
Inventory, net   -    2,225    -    -              -    2,225 
Prepaid expenses and other current assets   3,500    10,273    165,561    156,875              169,061    167,148 
Total current assets   50,464    19,900    232,051    172,794              282,515    192,694 
Deposit   -    -    60,000    60,000              60,000    60,000 
Property and Equipment, net   -    -    61,666    65,612              61,666    65,612 
Other long-term assets   -    -    178,348    232,065              178,348    232,065 
Total assets  $50,464   $19,900   $532,065   $530,471             $582,529   $550,371 
LIABILITIES AND STOCKHOLDERS’ DEFICIT                                        
Current liabilities:                                        
Accounts payable   312,580    530,907    1,239,977    898,463              1,552,557    1,429,370 
Accounts payable – related party   84,262    282,302    -    -              84,262    282,302 
Accrued expenses and other current liabilities   830,983    1,286,119    -    -              830,983    1,286,119 
Accrued expenses   -    -    232,323    344,065              232,323    344,065 
Accrued expenses – related party   114,297    1,397,409    62,500    50,000              176,797    1,447,409 
Accrued interest   -    -    159,554    132,175    (155,918)   (129,538)(b)   3,636    2,637 
Accrued interest, related party   -    -    2,138,175    1,810,232    (1,577,731)   (1,299,788)(b)   560,444    510,444 
Deferred Revenues   -    -    188,741    188,741              188,741    188,741 
Deferred revenue – related party   104,782    104,782    -    -              104,782    104,782 
Convertible note payable   -    1,402,000    -    -              -    1,402,000 
Convertible notes payable, current portion – in default   200,000    200,000    -    -              200,000    200,000 
Notes payable – related parties, current portion – portions in default   497,821    2,783,429    -    -              497,821    2,783,429 
Note payable marketing agreement   450,000    450,000    -    -              450,000    450,000 
Derivative liability, current portion   15,282    2,763    -    -              15,282    2,763 
Warrant liability   438,972    160,342    -    -              438,972    160,342 
Other current liabilities   -    -    260,241    313,146              260,241    313,146 
Total current liabilities   3,048,979    8,600,053    4,281,511    3,736,822    (1,733,649)   (1,429,326)   5,596,841    10,907,548 
Notes payable – net of current portion   -    -    900,000    610,000    (900,000)   (610,000)(b)   -    - 
Notes payable, related party – net of current portion   -    -    8,634,500    8,307,000    (7,634,500)   (7,307,000)(b)   1,000,000    1,000,000 
Other long-term liabilities   -    -    402,154    402,154              402,154    402,154 
Total Liabilities   3,048,979    8,600,053    14,218,165    13,055,976    (10,268,149)   (9,346,326)   6,998,995    12,309,702 
                                         
Commitments and Contingencies                                        
Preferred stock   -    -    40,070,108    40,070,108    (40,070,108)   (40,070,108)(a)   -    - 
Preferred stock B   963,964    -    -    -              963,964    - 
Preferred stock C   -    -              22,005,949    889,051(d)   22,005,949    889,051 
                                         
Stockholders’ deficit:                                        
Preferred stock A        83                        -    83 
Common stock   916,915    111,131    16    7    1,070    1,070(a)   916,915    111,131 
         -              954    869(b)          
                        (2,040)   (1,946)(d)          
Additional paid-in capital   37,165,114    19,322,864    44,779,011    44,727,164    40,069,037    40,069,037(a)   68,231,940    84,563,188 
         -              10,267,194    9,345,458(b)          
         -              (42,044,508)   (28,014,231)(c)          
                        (22,003,909)   (887,105)(d)          
Accumulated deficit   (42,044,508)   (28,014,231)   (98,535,234)   (97,322,784)   42,044,508    28,014,231(c)   (98,535,234)   (97,322,784)
Total stockholders’ deficit   (3,962,479)   (8,580,153)   (53,756,207)   (52,595,613)   28,332,307    48,527,383    (29,386,379)   (12,648,383)
Total liabilities and stockholders’ deficit  $50,464   $19,900   $532,065   $530,471   $-   $-   $582,529   $550,371 

 

2

 

 

UNAUDITED PROFORMA CONDENSED COMBINED STATEMENT OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 2021 AND 2020

 

   Boston Therapeutics   Nanomix, Inc.   Proforma Adjustment   Combined 
   3 Months Ended   3 Months Ended   3 Months Ended   3 Months Ended 
   Mar. 31,
2021
   Mar. 31,
2020
   Mar. 31,
2021
   Mar. 31,
2020
   Mar. 31,
2021
   Mar. 31,
2020
   Mar. 31,
2021
   Mar. 31,
2020
 
                                 
Revenue  $-   $3,093   $141,778   $23,136                $141,778   $26,229 
                                         
Operating expenses:                                        
Direct expenses   8,766    4,902    -     -             8,766    4,902 
Research and development   2,500    -    608,771    760,342              611,271    760,342 
Sales and marketing   308    541    -     -             308    541 
General and administrative   574,955    131,361    388,871    437,131              963,826    568,492 
Impairment of Intangibles   -    -    -    -              -    - 
Total operating expenses   586,529    136,804    997,642    1,197,473                                   1,584,171    1,334,277 
Operating loss   (586,529)   (133,711)   (855,864)   (1,174,336)   -    -    (1,442,393)   (1,308,047)
                                         
Other (expenses) income:                                        
Interest expense   (21,740)   (98,192)   (28,644)   (36,979)             (50,384)   (135,171)
Interest expense, related, party   -    -    (327,943)   (227,037)             (327,943)   (227,037)
Change in fair value of derivative liability   (21,143)   3,549    -    -              (21,143)   3,549 
Change in fair value of warrant liability   (278,630)   101,993    -    -              (278,630)   101,993 
Loss on conversion of related party debt into common stock   (10,604,620)   -    -    -              (10,604,620)   - 
Loss on conversion of trade payables into common stock   (993,715)   -    -    -              (993,715)   - 
Loss on conversion of Series A preferred stock into common stock   (1,735,500)   -    -    -              (1,735,500)   - 
Gain on settlement of accounts payable for Series B preferred stock   211,600    -    -    -              211,600    - 
Total other (expenses) income   (13,443,748)   7,350    (356,587)   (264,016)   -    -    (13,800,335)   (256,666)

Loss before provision for

income taxes

   (14,030,277)   (126,361)   (1,212,450)   (1,438,352)   -    -    (15,242,727)   (1,564,713)
Net loss  $ (14,030,277.00)  $ (126,361.00)  $ (1,212,450.36)  $ (1,438,352.26)  $-   $-   $ (15,242,727.36)  $ (1,564,713.26)
Net loss per share - basic and diluted   (0.02)   (0.00)   (0.99)   (1.93)             (0.02)   (0.01)
Weighted average shares outstanding basic and diluted   690,048,665    111,131,373    1,225,881    743,513               690,048,665    111,131,373 

 

3

 

 

UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET AS OF DECEMBER 31, 2020 AND 2019

 

   Boston Therapeutics   Nanomix, Inc   Proforma Adjustment   Combined 
   December 31,   December 31,   December 31,   December 31, 
   2020   2019   2020   2019   2020   2019   2020   2019 
ASSETS                                
Current assets:                                
Cash  $7,402.00   $6,701.00   $15,098.11   $590,433.53             $22,500.11   $597,134.53 
Accounts receivable             821    -              821    - 
Prepaid expenses and other current assets   10,273    12,662    156,875    4,446              167,148    17,108 
Inventory, net   2,225    3,909    -    -              2,225    3,909 
Total current assets   19,900    23,272    172,794    594,879    -    -    192,694    618,151 
Deposit             60,000    20,000              60,000    20,000 
Property and Equipment, net        509    65,612    50,521              65,612    51,030 
Other long-term assets             232,065    424,852              232,065    424,852 
Total assets  $19,900   $23,781   $530,471   $1,090,253   $-   $-   $550,371   $1,114,034 
                                         
LIABILITIES AND STOCKHOLDERS’ DEFICIT                                        
Current liabilities:                                        
Accounts payable   530,907    458,175    898,463    134,141              1,429,370    592,316 
Accounts payable–related party   282,302    152,302    -    -              282,302    152,302 
Accrued expenses and other current liabilities   1,286,119    1,361,194    -    -              1,286,119    1,361,194 
Accrued expenses             344,065    151,284              344,065    151,284 
Accrued expenses–related party   1,397,409    1,097,974    50,000    37,500              1,447,409    1,135,474 
Accrued interest             132,175    49,192    (129,538)   (49,192) (b)   2,637    - 
Accrued interest, related party             1,810,232    733,754    (1,299,788)   (426,643) (b)   510,444    307,111 
Deferred Revenues             188,741    176,102              188,741    176,102 
Deferred revenue–related party   104,782    104,782    -    -              104,782    104,782 
Convertible note payable   1,402,000    1,402,000    -    -              1,402,000    1,402,000 
Convertible notes payable, current portion–in default   200,000    250,000    -    -              200,000    250,000 
Notes payable–related parties, current portion–portions in default   2,783,429    1,948,429    -    -              2,783,429    1,948,429 
Note payable marketing agreement   450,000    450,000    -    -              450,000    450,000 
Derivative liability, current portion   2,763    9,451    -    -              2,763    9,451 
Warrant liability   160,342    461,744    -    -              160,342    461,744 
Other current liabilities             313,146    154,738              313,146    154,738 
Total current liabilities   8,600,053    7,696,051    3,736,822    1,436,710    (1,429,326)   (475,835)    10,907,548    8,656,926 
                                         
Notes payable–net of current portion             610,000    360,000    (610,000)   (360,000) (b)   -    - 
Notes payable, related party–net of current portion             8,307,000    5,575,000    (7,307,000)   (4,575,000) (b)   1,000,000    1,000,000 
Other long-term liabilities             402,154    313,146              402,154    313,146 
Total Liabilities   8,600,053    7,696,051    13,055,976    7,684,856    (9,346,326)   (5,410,835)    12,309,702    9,970,073 
                                         
Commitments and Contingencies                                        
Preferred stock             40,070,108    40,070,108    (40,070,108)   (40,070,108) (a)   -    - 
Preferred stock C                       889,051    1,778,102  (d)   889,051    1,778,102 
                                         
Stockholders’ deficit:                                        
Preferred stock A   83    83                        83    83 
Common stock   111,131    111,131    7    7    1,070    1,070  (a)   111,131    111,131 
                        869    503  (b)          
                        (1,946)   (1,581) (d)          
Additional paid-in capital   19,322,864    19,322,864    44,727,164    44,465,695    40,069,037    40,069,037  (a)   84,563,188    80,385,059 
                        9,345,458    5,410,332  (b)          
                        (28,014,231)   (27,106,348) (c)          
                        (887,105)   (1,776,521

) (d)

          
Accumulated deficit   (28,014,231)   (27,106,348)   (97,322,784)   (91,130,414)   28,014,231    27,106,348  (c)   (97,322,784)   (91,130,414)
Total stockholders’ deficit   (8,580,153)   (7,672,270)   (52,595,613)   (46,664,712)   48,527,383    43,702,841    (12,648,383)   (10,634,141)
                                         
Total liabilities and stockholders’ deficit  $19,900   $23,781   $530,471   $1,090,253   $-   $-   $550,371   $1,114,034 

 

4

 

 

UNAUDITED PROFORMA CONDENSED COMBINED STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2020 AND 2019

 

   Boston Therapeutics   Nanomix, Inc.   P roforma
Adjustment
   Combined 
   12 Months Ended   12 Months Ended   12 Months Ended   12 Months Ended 
   Dec. 31,
2020
   Dec. 31,
2019
   Dec. 31,
2020
   Dec. 31,
2019
   Dec. 31,
2020
   Dec. 31, 
2019
   Dec. 31,
2020
   Dec. 31,
2019
 
Revenue  $9,336   $16,329   $513,244   $392,422                       $522,580   $408,751 
Operating expenses:                                                   
Direct expenses   32,041    27,008    -    -              32,041    27,008 
Research and development   180,908    1,710,943    4,184,820    3,765,203              4,365,728    5,476,146 
Sales and marketing   898    791,232    -    -              898    791,232 
General and administrative   581,423    980,381    1,234,784    1,331,593              1,816,207    2,311,974 
Impairment of Intangibles        367,181    -    -              -    367,181 
Total operating expenses   795,270    3,876,745    5,419,604    5,096,796              6,214,874    8,973,541 
Operating loss   (785,934)   (3,860,416)   (4,906,359)   (4,704,373)             (5,692,293)   (8,564,789)
                                         
Other (expenses) income:                                        
Interest income             6    47              6    47 
Interest expense   (430,039)   (342,516)   (209,538)   (200,110)             (639,577)   (542,626)
Interest expense, related, party             (1,076,478)   (619,147)             (1,076,478)   (619,147)
Change in fair value of derivative liability   6,688    44,791    -    -              6,688    44,791 
Change in fair value of warrant liability   301,402    464,062    -    -              301,402    464,062 
Total other (expenses) income   (121,949)   166,337    (1,286,011)   (819,210)             (1,407,960)   (652,873)
Loss before provision for income taxes   (907,883)   (3,694,079)   (6,192,370)   (5,523,583)             (7,100,253)   (9,217,662)
Net loss  $(907,883.00)  $(3,694,079.00)  $(6,192,370.08)  $(5,523,582.92)            $(7,100,253.08)  $(9,217,661.92)
Net loss per share - basic and diluted   (0.01)   (0.03)   (8.33)   (7.43)             (0.06)   (0.08)
Weighted average shares outstanding basic and diluted   111,131,373    111,076,124    743,513    743,513              111,131,373    111,076,124 

 

5

 

 

Notes to Unaudited Pro Forma Condensed Consolidated Financial Information

 

Note 1 - Basis of Presentation

 

The unaudited pro forma condensed financial information was prepared pursuant to the rules and regulations of SEC Regulation S-X, and present the pro forma condensed financial balance sheet and results of operations of the combined companies based on the historical data of Boston Therapeutics and Nanomix.

 

The unaudited pro forma condensed financial information includes pro forma adjustments that are (i) directly attributable to the transaction, (ii) factually supportable, and (iii) with respect to the unaudited condensed pro forma statements of operations, expected to have a continuing impact on the results of operations of the combined company.

 

Note 2 – Pro Forma Adjustments

 

In the merger which closed on June 4, 2021, Boston Therapeutics (BT) issued 1,000,000 shares of Preferred C shares that convert into 80% ownership in the merged company.  The conversion into common shares will occur after approval by regulatory authorities of the reverse stock split. As Boston Therapeutics has minimal assets and operations, the merger was accounted for as a reverse recapitalization. The resulting unaudited pro forma condensed consolidated financial statements thus reflect the following:

 

The issuance of Preferred C shares in exchange for :

 

All Nanomix common shares

 

All Nanomix preferred shares as converted to common

 

All Nanomix Convertible Notes and Accrued interest as converted to common

 

Assumption of all outstanding Nanomix stock options and warrants

 

The Secured $1M Note payable and accrued interest to a related party was not converted and is an obligation of the merged company. 

 

The adjustments included in the unaudited pro forma condensed combined balance sheet as of March 31, 2021 and December 31, 2020 and in the unaudited pro forma condensed combined balance sheet as of December 31, 2020 and 2019 are as follows:

 

(a)Nanomix preferred stock conversion into common stock:

 

Convertible Preferred Stock  Preferred
stock shares
Outstanding
   Issue
price
   Preferred
stock
Amount
   Conversion
Ratio
   Common
Stock Shares
Outstanding
   Common
Stock
Amount
 
Series AA:   1,045,650    1.1500   $1,202,498    1.2220    1,277,784   $13 
Series BB:   22,120,639    0.0811    1,794,205    1.0000    22,120,639    221 
Series CC:   13,761,489    0.4618    6,354,368    1.0823    14,894,060    149 
Series DD:   33,790,975    0.6197    20,940,605    1.1377    38,443,992    384 
Series EE-1:   14,030,343    0.3228    4,528,434    1.0000    14,030,343    140 
Series EE-2:   16,265,953    0.3228    5,249,999    1.0000    16,265,953    163 
Total Preferred Stock:   101,015,049        $40,070,108         107,032,771   $1,070 

 

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(b)Nanomix Convertible Notes and accrued interest conversion into common stock:

 

   As of
December 31,
   As of
December 31,
   As of
March 31,
 
   2019   2020   2021 
Pricipal Amount  $4,935,000   $7,917,000   $8,534,500 
Accrued Interest  $475,835   $1,429,326   $1,733,649 
Total  $5,410,835   $9,346,326   $10,268,149 
Conversion rate   0.10759    0.10759    0.10759 
Shares on Conv.   50,291,244    86,869,843    95,437,760 
Common Stock Amount  $503   $869   $954 
Additional paid-in capital  $5,410,332   $9,345,458   $10,267,194 

 

(c)Boston Therapeutics accumulated deficit elimination

 

(d)Issuance of BTHE Preferred C shares for exchange 80% of BTHE stock to 100% of Nanomix common stock:

 

   As of
December 31,
   As of
December 31,
   As of
March 31,
 
   2019   2020   2021 
Common stock shares outstanding   111,131,373    111,131,373    916,914,554 
Market price per share  $0.02   $0.01   $0.03 
Market capitalization  $2,222,627   $1,111,314   $27,507,437 
Nanomix 80% share  $1,778,102   $889,051   $22,005,949 

 

Note 3 – Subsequent Financial Transaction

 

Post merger, the combined company entered into a Convertible Secured Note offering that closed on June 25, 2021.  This was a financing of the merged companies and a separate transaction from the merger. As a result of post-merger split, after approval by the regulatory authorities of the 173:1 reverse split, there are 46,188,898 shares of common stock par value $0.01 per share.

 

 

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