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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Capstone Therapeutics Corporation (QB) | USOTC:CAPS | OTCMarkets | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 4.10 | 4.10 | 4.90 | 0.00 | 13:01:10 |
Delaware | 86-0585310 |
(State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |
PAGE
|
|||
Item
1.
|
Business
|
Item
1A.
|
Risk Factors
|
·
|
the impact of our plan to preserve cash during ongoing partnering efforts, including the reduction from eighteen employees to two employees and additional steps taken towards a virtual operating model;
|
·
|
unfavorable results of our product candidate development efforts, including through our LipimetiX joint venture;
|
·
|
unfavorable results of pre-clinical and clinical testing, including through our LipimetiX joint venture;
|
·
|
delays in obtaining, or failure to obtain FDA or comparable foreign agencies’ approvals;
|
·
|
increased regulation by the FDA and other agencies;
|
·
|
the introduction of competitive products;
|
·
|
impairment of license, patent or other proprietary rights;
|
·
|
the impact of present and future joint venture, collaborative, partnering or development agreements or the lack thereof;
|
·
|
failure to successfully implement our drug development strategy for AEM-28 or AZX100;
|
·
|
failure to obtain additional funds required to complete clinical trials and supporting research and production efforts necessary to obtain FDA or comparable foreign agencies’ approval for our product candidates or secure development agreements with pharmaceutical manufacturers; and
|
·
|
effect of the ongoing
qui tam
litigation on our stock price, liquidity, and our ability to execute corporate or other transactions, or our ability to continue operations.
|
·
|
the FDA or comparable foreign agencies finds some or all of our product candidates ineffective or unsafe;
|
·
|
we do not receive necessary regulatory approvals;
|
·
|
we are unable to get some or all of our product candidates to market in a timely manner;
|
·
|
we are not able to produce our product candidates in commercial quantities at reasonable costs;
|
·
|
our products undergo post-market evaluations resulting in marketing restrictions or withdrawal of our products; or
|
·
|
the patients, insurance and/or physician community does not accept our products.
|
·
|
adverse or ambiguous results;
|
·
|
undesirable side effects which delay or extend the trials;
|
·
|
inability to locate, recruit, qualify and retain a sufficient number of patients for our trials;
|
·
|
regulatory delays or other regulatory actions;
|
·
|
difficulties in obtaining sufficient quantities of the particular product candidate or any other components needed for our pre-clinical testing or clinical trials;
|
·
|
change in the focus of our development efforts;
|
·
|
re-evaluation of our clinical development strategy; and
|
·
|
lack of sufficient funds to pay for development costs.
|
·
|
pay substantial damages;
|
·
|
stop using our technologies;
|
·
|
stop certain research and development efforts;
|
·
|
develop non-infringing products or methods; and
|
·
|
obtain one or more licenses from third parties.
|
·
|
announcement of the results of, or delays in, preclinical and clinical studies;
|
·
|
fluctuations in our operating results;
|
·
|
developments in litigation to which we or a competitor is subject;
|
·
|
announcements and timing of potential partnering, development collaboration or licensing transactions, merger, acquisitions, divestitures, capital raising activities or issuance of preferred stock;
|
·
|
announcements of technological innovations or new products by us or our competitors;
|
·
|
FDA and other regulatory actions;
|
·
|
developments with respect to our or our competitors’ patents or proprietary rights;
|
·
|
public concern as to the safety of products developed by us or others; and
|
·
|
changes in stock market analyst recommendations regarding us, other drug development companies or the pharmaceutical industry generally.
|
|
·
|
a classified board of directors with three-year staggered terms;
|
|
·
|
advance notice procedures for stockholder proposals to be considered at stockholders’ meetings;
|
|
·
|
the ability of our board of directors to fill vacancies on the board;
|
|
·
|
a prohibition against stockholders taking action by written consent;
|
|
·
|
super majority voting requirements for the stockholders to modify or amend our bylaws and specified provisions of our certificate of incorporation, and
|
|
·
|
the ability of our board of directors to issue up to 2,000,000 shares of preferred stock without stockholder approval.
|
Item
1B.
|
Unresolved Staff Comments
|
Item
2.
|
Properties
|
Item
3.
|
Legal Proceedings
|
Item
4.
|
Mine Safety Disclosures
|
Item
5.
|
Market for Registrant’s Common Equity, Related Stockholder Matters
and Issuer Purchases of Equity Securities
|
2013
|
2012
|
|||||||||||||||
High
|
Low
|
High
|
Low
|
|||||||||||||
First Quarter
|
$ | 0.26 | $ | 0.17 | $ | 0.28 | $ | 0.19 | ||||||||
Second Quarter
|
$ | 0.24 | $ | 0.17 | $ | 0.21 | $ | 0.15 | ||||||||
Third Quarter
|
$ | 0.42 | $ | 0.17 | $ | 0.21 | $ | 0.12 | ||||||||
Fourth Quarter
|
$ | 0.38 | $ | 0.21 | $ | 0.20 | $ | 0.12 |
Item
6.
|
Selected Financial Data
|
Years Ended December 31,
|
August 5, 2004
|
|||||||||||||||||||||||
to
|
||||||||||||||||||||||||
December 31, 2008
|
||||||||||||||||||||||||
2013 (1)
|
2012
|
2011(1)
|
2010(1)
|
2009(2)
|
(3) (4) (5) | |||||||||||||||||||
Operating expenses
|
||||||||||||||||||||||||
General and administrative
|
$ | 1,169 | $ | 1,764 | $ | 3,506 | $ | 3,240 | $ | 2,901 | $ | 20,075 | ||||||||||||
Research and development
|
3,124 | 2,385 | 6,394 | 8,168 | 11,968 | 73,519 | ||||||||||||||||||
Purchased in-process research and development
|
- | - | - | - | - | 34,311 | ||||||||||||||||||
Other
|
- | - | - | - | - | (375 | ) | |||||||||||||||||
Total operating expenses
|
4,293 | 4,149 | 9,900 | 11,408 | 14,869 | 127,530 | ||||||||||||||||||
Interest and other income, net
|
(158 | ) | (96 | ) | (31 | ) | (356 | ) | (737 | ) | (12,634 | ) | ||||||||||||
Loss from continuing operations before taxes
|
4,135 | 4,053 | 9,869 | 11,052 | 14,132 | 114,896 | ||||||||||||||||||
Income taxes expense (benefit)
|
(21 | ) | - | (158 | ) | (181 | ) | (1,009 | ) | (7 | ) | |||||||||||||
Loss from continuing operations
|
4,114 | 4,053 | 9,711 | 10,871 | 13,123 | 114,889 | ||||||||||||||||||
Discontinued operations
|
||||||||||||||||||||||||
Net gain on the sale of the bone device business
|
||||||||||||||||||||||||
net of taxes $0, $0, $0, $0, $0, ($363) respectively
|
- | - | - | - | - | (2,202 | ) | |||||||||||||||||
NET LOSS
|
4,114 | 4,053 | 9,711 | 10,871 | 13,123 | 112,687 | ||||||||||||||||||
Less: Net loss attributable to the
|
||||||||||||||||||||||||
noncontrolling interests
|
(193 | ) | (473 | ) | - | - | - | - | ||||||||||||||||
Net loss attributable to Capstone stockholders
|
$ | 3,921 | $ | 3,580 | $ | 9,711 | $ | 10,871 | $ | 13,123 | $ | 112,687 | ||||||||||||
Per Share Information:
|
||||||||||||||||||||||||
Net loss basic and diluted
|
$ | 0.10 | $ | 0.09 | $ | 0.24 | $ | 0.27 | $ | 0.32 | ||||||||||||||
Basic and diluted shares outstanding
|
40,885 | 40,879 | 40,775 | 40,775 | 40,775 |
1.
|
The 2013, 2011 and 2010 income tax benefits result from Arizona state income tax legislation passed in 2010 that provides for the refund of seventy five percent of the2012, 2011 and 2010 Arizona state research and development tax credits for entities that would otherwise not be able to utilize their 2012, 2011 and 2010 Arizona research and development tax credits to reduce 2012, 2011 and 2010 Arizona state income taxes currently payable.
|
2.
|
The income tax benefit in 2009 of $1,009,000 results from the carryback of our net operating loss for federal income tax purposes for the year ended December 31, 2008 to the year ended December 31, 2003, as allowed by federal tax legislation passed in 2009.
|
3.
|
Research and development expenses in 2006 include recognition of a $2,100,000 Chrysalin patent cost impairment loss. Operating expenses in 2006 included $8,471,000 of purchased in-process research and development costs associated with the AzERx acquisition in February 2006. Income tax expenses in 2006 included the recording of a $1,106,000 valuation allowance for a deferred tax asset related to an Alternative Minimum Tax credit carryover.
|
4.
|
On August 5, 2004, we completed the acquisition of CBI. Capstone expensed in-process research and development and acquisition costs of $25.8 million.
|
5.
|
A net gain of $2,048,000 was recognized on the sale of the Bone Device Business primarily due to a decrease in the risk related to the potential exposure of the representations and warranties provided in the governing asset purchase agreement.
|
December 31,
|
||||||||||||||||||||
2013
|
2012
|
2011
|
2010
|
2009
|
||||||||||||||||
Working capital
|
$ | 6,391 | $ | 10,294 | $ | 14,417 | $ | 23,214 | $ | 34,395 | ||||||||||
Total assets
|
$ | 7,317 | $ | 11,591 | $ | 14,696 | $ | 25,288 | $ | 37,135 | ||||||||||
Potentially redeemable equity
|
$ | - | $ | - | $ | - | $ | 15,556 | $ | - | ||||||||||
Capstone Stockholders’ equity
|
$ | 7,217 | $ | 11,104 | $ | 14,577 | $ | 7,916 | $ | 34,728 |
Item
7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
Item
7A.
|
Quantitative and Qualitative Disclosures about Market Risk
|
Item
8.
|
Financial Statements and Supplementary Data
|
Item
9.
|
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
|
Item
9A.
|
Controls and Procedures
|
Item
9B.
|
Other Information
|
Item
10.
|
Directors, Executive Officers and Corporate Governance
|
(1)
|
Member of the Audit Committee
|
(2)
|
Member of the Compensation Committee
|
(3)
|
Member of the Corporate Governance/Nominating Committee
|
Name
|
Age
|
Title
|
John M. Holliman, III
|
60
|
Executive Chairman and Principal Executive Officer
|
Randolph C. Steer, MD, Ph.D.
|
64
|
Consultant
|
Les M. Taeger
|
63
|
Senior Vice President, Chief Financial Officer and Principal Financial and Accounting Officer
|
Item
11.
|
Executive Compensation
|
Name
|
Fees
Earned or
Paid in
Cash
($)
|
Stock
Awards
($)
|
Option
Awards
($) (1)
|
Non-Equity
Incentive Plan
Compensation
($)
|
Nonqualified
Deferred
Compensation
Earnings
($)
|
All Other
Compensation
($)
|
Total
($)
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
Fredric J. Feldman, Ph.D.
|
49,000
|
4,000
|
-
|
-
|
-
|
53,000
|
|
Elwood D. Howse, Jr.
|
49,000
|
4,000
|
-
|
-
|
-
|
53,000
|
(1)
|
Fair value of the grants at the date of the grants was determined using the Black-Scholes model as described in Note 5 to the Financial Statements included in this Annual Report on Form 10-K.
|
Name
|
Option Awards
|
||||||
Number of
Securities
Underlying
Unexercised
Options
(#)
Exercisable
|
Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable
|
Equity Incentive Plan
Awards: Number of
Securities Underlying
Unexercised Unearned
Options (#)
|
Options
Exercise
Price
($)
|
Option
Expiration Date
|
|||
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
||
John M. Holliman, III
|
200,000
|
1.75
|
5/12/2016
|
||||
50,000
|
1.02
|
2/21/2018
|
|||||
125,000
|
0.45
|
2/3/2019
|
|||||
100,000
|
0.82
|
2/4/2020
|
|||||
25,000
|
0.70
|
10/30/2018
|
|||||
65,000
|
0.17
|
5/18/2022
|
|||||
65,000
|
0.16
|
8/9/2022
|
|||||
|
*
|
25,500
|
25,500
|
0.16
|
2/28/2023
|
||
Various directors:
|
|||||||
(1) (2) (3)
|
30,000
|
7.40
|
1/23/2014
|
||||
(1) (2) (3)
|
10,000
|
6.25
|
12/31/2014
|
||||
(1) (2) (3)
|
10,000
|
4.90
|
1/2/2016
|
||||
(1) (2) (3)
|
25,000
|
1.75
|
5/12/2016
|
||||
(1) (2) (3)
|
10,000
|
1.43
|
1/1/2017
|
||||
(1) (2) (3)
|
10,000
|
1.35
|
1/1/2018
|
||||
(1) (3)
|
25,000
|
0.70
|
10/30/2018
|
||||
(1) (2) (3)
|
10,000
|
0.42
|
1/1/2019
|
||||
(1) (2) (3)
|
10,000
|
0.72
|
1/1/2020
|
||||
(1)(2)(3)
|
10,000
|
0.58
|
1/1/2021
|
||||
(1) (2) (3)
|
10,000
|
0.26
|
1/1/2022
|
||||
(1) (2)
|
35,000
|
0.17
|
5/18/2022
|
||||
(1) (2)
|
42,500
|
0.16
|
8/9/2022
|
||||
(1) (2) (3)
|
* |
10,000
|
0.17
|
1/1/2023
|
|||
(1) (3)
|
13,500
|
13,500
|
0.21
|
2/28/2023
|
|||
Feldman, Fred (1)
|
|||||||
Holliman, John (2)
|
* Vest on 2/28/2014
|
||||||
Howse, Elwood (3)
|
All other directors options were fully vested on 12/31/2013
|
Name
|
Year
|
Salary
($)
|
Bonus
($)
|
Stock
Awards
($)
|
Option
Awards
($)
(1)
|
Non-Equity
Incentive Plan
Compensation
($)
|
Nonqualified
Deferred
Compensation
Earnings ($)
|
All
Other
Compensation
($)
|
Total
($)
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
(g)
|
(h)
|
(i)
|
(j)
|
John M.
Holliman, III
Executive
Chairman
(Principal
Executive
Officer)
|
2013
2012
2011
|
100,000
100,000
179,000
|
-
-
-
|
-
3,000(3)
19,000(3)
|
7,000
14,000
3,000
|
-
-
-
|
-
-
-
|
41,000 (1)
16,000(1)
264,000(1)(2)
|
148,000
133,000
465,000
|
Randolph C.
Steer, MD,
Ph.D.,
Consultant
(former
President)
|
2013
2012
2011
|
120,000
120,000
276,000
|
-
25,000
-
|
-
-
-
|
9,000
12,000
19,000
|
-
-
-
|
-
-
-
|
-
-
325,000 (2)
|
129,000
157,000
620,000
|
Les M. Taeger
Chief
Financial
Officer
(Principal
Financial
Officer)
|
2013
2012
2011
|
120,000
120,000
237,000
|
-
25,000
-
|
-
-
-
|
6,000
8,000
10,000
|
-
-
-
|
-
-
-
|
-
-
242,000 (2)
|
126,000
153,000
489,000
|
1.
|
Mr. Holliman is a member of the Board of Directors and as a director, received compensation of $41,000, $16,000 and $64,000, in cash, in 2013, 2012 and 2011, respectively, and an annual grant of an option to purchase 10,000 shares of the Company’s Common Stock. Mr. Holliman received total director’s compensation (Board fees, stock awards and option grants) of $48,000, $20,000 and $67,000 in 2013, 2012 and 2011, respectively, as more fully described in the Compensation of Directors section of this Annual Report on Form 10-K. Fair value of the grants at the date of the grants was determined using the Black-Scholes model as described, for 2013, in Note 5 to the Financial Statements included in this Annual Report on Form 10-K, for 2012, in Note 5 to our Annual Report on form 10-K filed with the Securities and Exchange Commission on March 14, 2013 and for 2011, in Note 5 to the Annual Report on form 10-K filed with the Securities and Exchange Commission on March 21, 2012.
|
2.
|
On October 31, 2011, the employment of Mr. Holliman and Dr. Steer was terminated and Mr. Taeger’s salary was reduced from $242,000 per year to $120,000. These actions triggered severance clauses in their employment agreements requiring the payment of severance of one year’s base salary to each executive officer. For a description of the employment agreements with our named executive offers, please see “Employment Contract, Termination of Employment, and Change-in-Control Arrangements” below.
|
3.
|
On January 17, 2011, Mr. Holliman was awarded 50,000 shares of restricted stock which vested on January 17, 2012. On January 1, 2012, along with the other members of the Board of Directors, Mr. Holliman was awarded 10,000 shares of common stock.
|
Name
|
Grant
Date
|
All Other
Stock
Awards:
Number of
Shares
of Stock
or Units
(#)
|
All Other
Option
Awards:
Number of
Securities
Underlying
Options
(#)
|
Exercise or
Base Price
of Option
Awards
($/Share)
|
Grant Date Fair
Value of Stock
and Option
Awards (1)
($)
|
(a)
|
(b)
|
(i)
|
(j)
|
(k)
|
(l)
|
John M. Holliman, III
Executive Chairman
|
1/1/13
2/28/13
|
-
-
|
10,000
51,000
|
0.17
0.21
|
1,000
6,000
|
Randolph C. Steer,
MD, Ph.D.
Consultant
|
2/28/13
10/25/13
|
-
-
|
51,000
10,000
|
0.21
0.35
|
6,000
3,000
|
Les M. Taeger
Chief Financial
Officer
|
2/28/13
10/25/13
|
-
-
|
29,000
10,000
|
0.21
0.35
|
3,000
3,000
|
Name
|
Option Awards
|
|||||||
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
|
Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
|
Option
Exercise Price
($)
|
Option
Expiration Date
|
|||||
(a)
|
(b)
|
(c)
|
(e)
|
(f)
|
||||
John M. Holliman, III
|
30,000
|
-
|
7.40
|
1/23/2014
|
||||
10,000
|
-
|
6.25
|
12/31/2014
|
|||||
10,000
|
-
|
4.90
|
1/2/2016
|
|||||
25,000
|
-
|
1.75
|
5/12/2016
|
|||||
200,000
|
-
|
1.75
|
5/12/2016
|
|||||
10,000
|
-
|
1.43
|
12/31/2017
|
|||||
10,000
|
-
|
1.35
|
12/31/2018
|
|||||
50,000
|
-
|
1.02
|
2/21/2018
|
|||||
25,000
|
-
|
0.70
|
10/30/2018
|
|||||
10,000
|
-
|
0.42
|
1/1/2019
|
|||||
125,000
|
-
|
0.45
|
2/3/2019
|
|||||
10,000
|
-
|
0.72
|
1/1/2020
|
|||||
100,000
|
0.82
|
2/4/2020
|
||||||
10,000
|
-
|
0.58
|
1/1/2021
|
|||||
10,000
|
-
|
0.26
|
1/1/2022
|
|||||
65,000
|
-
|
0.17
|
5/18/2022
|
|||||
65,000
|
-
|
0.16
|
8/9/2022
|
|||||
10,000
|
-
|
0.17
|
1/1/2023
|
|||||
*
|
25,500
|
25,500
|
0.21
|
2/28/2023
|
||||
Randolph C. Steer, MD, Ph.D.
|
200,000
|
-
|
1.75
|
5/12/2016
|
||||
50,000
|
-
|
1.53
|
5/21/2017
|
|||||
50,000
|
-
|
1.02
|
2/21/2018
|
|||||
75,000
|
-
|
0.45
|
2/3/2019
|
|||||
50,000
|
-
|
0.82
|
2/4/2020
|
|||||
50,000
|
-
|
0.67
|
1/17/2021
|
|||||
65,000
|
-
|
0.17
|
5/18/2022
|
|||||
65,000
|
0.16
|
8/9/2022
|
||||||
*
|
25,500
|
25,500
|
0.21
|
2/28/2023
|
||||
**
|
5,000
|
5,000
|
0.35
|
10/25/2023
|
||||
Les M. Taeger
|
150,000
|
-
|
5.15
|
1/16/2016
|
||||
150,000
|
-
|
1.70
|
6/2/2016
|
|||||
14,706
|
-
|
1.02
|
2/21/2018
|
|||||
50,000
|
-
|
0.45
|
2/3/2019
|
|||||
35,000
|
-
|
0.82
|
2/4/2020
|
|||||
25,000
|
-
|
0.67
|
1/17/2021
|
|||||
45,000
|
-
|
0.17
|
5/18/2022
|
|||||
45,000
|
-
|
0.16
|
8/9/2022
|
|||||
*
|
14,500
|
14,500
|
0.21
|
2/28/2023
|
||||
**
|
5,000
|
5,000
|
0.35
|
10/25/2023
|
*
|
Vest on 2/28/2014
|
**
|
Vest on 10/25/2014
|
Item
12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
|
Common Stock
|
||||
Beneficially Owned (1)
|
||||
Beneficial Owner
|
Number
|
Percent of Class
|
||
Fredric J. Feldman (2)
|
492,064
|
1.1
|
||
John M. Holliman, III (3)
|
1,340,272
|
3.1
|
||
Elwood D. Howse, Jr. (4)
|
489,203
|
1.2
|
||
Randolph C. Steer (5)
|
733,298
|
1.7
|
||
Les M. Taeger (6)
|
613,280
|
1.4
|
||
BVF Group (7)
|
7,755,688
|
19.0
|
||
Lloyd Miller, III (8)
|
7,926,389
|
19.4
|
||
All directors and executive officers as a group (9)
|
3,668,117
|
8.2
|
(1)
|
Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission (“SEC”) and generally includes voting or investment power with respect to securities. In accordance with SEC rules, shares, which may be acquired upon exercise of stock options which are currently exercisable or which become exercisable within 60 days of the date of the table, are deemed beneficially owned by the optionee. Except as indicated by footnote, and subject to community property laws where applicable, the persons or entities named in the table above have sole voting and investment power with respect to all shares of Common Stock shown as beneficially owned by them.
|
(2)
|
Includes 266,500 shares Dr. Feldman has a right to acquire upon exercise of stock options. Voting and investment power shared with spouse.
|
(3)
|
Includes 828,000 shares Mr. Holliman has a right to acquire upon exercise of stock options, 3,000 shares indirectly owned as trustee and 1,658 shares indirectly owned as trustee of Valley Ventures III, LP.
|
(4)
|
Includes 266,500 shares Mr. Howse has a right to acquire upon exercise of stock options.
|
(5)
|
Includes 688,000 shares Dr. Steer has a right to acquire upon exercise of stock options.
|
(6)
|
Includes 568,706 shares Mr. Taeger has a right to acquire upon exercise of stock options.
|
(7)
|
BVF Group (Biotechnology Value Fund, L.P., Biotechnology Value Fund II, L.P. BVF Investments, L.L.C., Investment 10, L.L.C., BVF Partners, L.P., BVF Inc.) is not a related party or otherwise affiliated with the Company, its directors or officers, and the principal business office of the Reporting Persons comprising the Group is located at 900 North Michigan Avenue, Suite 1100, Chicago, IL 60611.
|
(8)
|
Lloyd Miller, III, is not a related party or otherwise affiliated with the Company, its directors or officers, and the principal business office of the Reporting Person is located at 222 Lakeview Avenue, Suite 160-365, West Palm Beach, Florida 33401
|
(9)
|
Includes 2,617,706 shares directors and executive officers have a right to acquire upon exercise of stock options.
|
Number of securities to
|
Weighted average
|
Number of securities remaining
|
|
be issued upon exercise
|
exercise price of
|
available for future issuance
|
|
of outstanding options,
|
outstanding options,
|
under equity compensation plans
|
|
warrants and rights
|
warrants and rights
|
(excluding securities reflected in
|
|
column (a)
|
|||
Plan Category:
|
(c)
|
(b)
|
(c)
|
Equity Compensation Plans
|
|||
approved by Security Holders
|
3,225,806
|
$1.52
|
48,519
|
Equity Compensation Plans
|
|||
not approved by Security Holders
|
N/A
|
N/A
|
N/A
|
Total
|
3,225,806
|
$1.52
|
48,519
|
Item
13.
|
Certain Relationships and Related Transactions, and Director Independence
|
Item
14.
|
Principal Accountant Fees and Services
|
Type of Fee
|
Amount
|
|||||||
2013
|
2012
|
|||||||
Audit Fees (1)
|
$ | 111,000 | $ | 132,000 | ||||
Audit-Related Fees (2)
|
- | 7,000 | ||||||
Total Audit and Audit-Related Fees
|
111,000 | 139,000 | ||||||
Tax Fees (3)
|
- | - | ||||||
All Other Fees (4)
|
- | - | ||||||
Total Fees
|
$ | 111,000 | $ | 139,000 |
|
(1)
|
Audit fees include fees for services rendered in connection with the audits of the Company’s financial statements for the fiscal years ended December 31, 2013 and 2012 and reviews of the financial statements included in the Company’s quarterly reports on Form 10-Q during the applicable fiscal year.
|
|
(2)
|
Audit-related fees would include fees for services rendered for matters such as a business combination, sales of shares of the Company’s common stock, and responses to accounting and reporting-related matters.
|
|
(3)
|
Tax fees would include fees for services rendered for tax compliance, preparation of original and amended tax returns, claims for refunds and other tax services.
|
|
(4)
|
Our principal accounting firms did not perform nor bill the Company for any other services during the fiscal years ended December 31, 2013 and 2012 that are appropriately classified as “All Other Fees.”
|
Item
15.
|
Exhibits and Financial Statement Schedules
|
(a)
|
The following documents are filed as part of this report
:
|
1.
|
Financial Statements.
|
|
The following financial statements of Capstone Therapeutics Corp. and Report of our Independent Registered Public Accounting Firm are presented in the “F” pages of this report:
|
|
Consolidated Balance Sheets - December 31, 2013 and 2012.
|
|
Consolidated Statements of Operations - Each of the years in the two-year period ended December 31, 2013 and for the period of August 5, 2004 through December 31, 2013.
|
|
Consolidated Statements of Changes in Equity - Each of the years in the two-year period ended December 31, 2013 and for the period of August 5, 2004 through December 31, 2013.
|
|
Consolidated Statements of Cash Flows - Each of the years in the two-year period ended December 31, 2013 and for the period of August 5, 2004 through December 31, 2013.
|
2.
|
Financial Statement Schedules have been omitted since they are not applicable.
|
3.
|
All management contracts and compensatory plans and arrangements are specifically identified on the attached Exhibit Index.
|
(b)
|
Exhibits
|
(c)
|
Financial Statements and Schedules
- See Item 15(a)(1) and Item 15(a)(2) above.
|
CAPSTONE THERAPEUTICS CORP.
|
|||
Date: March 27, 2014 | By | /s/ John M. Holliman, III | |
John M. Holliman, III
Executive Chairman
|
Signature
|
Title
|
Date
|
/s/ John M. Holliman, III
John M. Holliman, III
|
Executive Chairman
(Principal Executive Officer)
and Director
|
March 27, 2014
|
/s/ Fredric J. Feldman
Fredric J. Feldman, Ph.D.
|
Director
|
March 27, 2014
|
/s/ Elwood D. Howse, Jr.
Elwood D. Howse, Jr.
|
Director
|
March 27, 2014
|
/s/ Les M. Taeger
Les M. Taeger
|
Senior Vice President and Chief
Financial Officer (Principal
Financial and Accounting Officer)
|
March 27, 2014
|
Exhibit
No.
|
Description
|
Incorporated by Reference To
:
|
Filed
Or Furnished
Herewith
|
|||
3.1
|
Amended and Restated Certificate of Designation of Series A Preferred Stock, executed June 19, 2007
|
Exhibit 3.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission (“SEC”) on June 25, 2007 (“June 25
th
2007 8-K”)
|
||||
3.2
|
Bylaws of the Company
|
Exhibit 3.4 to the Company’s Amendment No. 2 to Registration Statement on Form S-1 (No. 33-47569) filed with the SEC on January 25, 1993 (“January 1993 S-1”)
|
||||
3.3
|
Certificate of Incorporation, as amended through May 21, 2010
|
Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2010, filed with the SEC on August 9, 2010
|
||||
4.1
|
Class A Warrant Agreement dated February 24, 2006, between OrthoLogic Corp. and PharmaBio Development Inc. (d/b/a NovaQuest)
|
Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on March 3, 2006
|
||||
4.2
|
Class A Warrant Agreement dated June 30, 2006 by and between OrthoLogic Corp. and PharmaBio Development Inc
|
Exhibit 4.1 to the Company’s Current Report on Form 8-K filed with the SEC on July 6, 2006
|
||||
4.3
|
Amended and Restated Class B Warrant Agreement dated February 24, 2006, and amended and restated as of June 30, 2006, between OrthoLogic Corp. and PharmaBio Development Inc. (d/b/a NovaQuest) (asterisks located within exhibit denote information that has been redacted pursuant to a request for confidential treatment filed with the SEC)
|
Exhibit 4.4 to the Company’s Amendment No. 1 to Registration Statement on Form 8-A/A, filed with the SEC on May 25, 2010.
|
||||
10.1
|
Form of Indemnification Agreement(*)
|
Exhibit 10.16 to the Company’s January 1993 S-1
|
||||
10.2
|
1997 Stock Option Plan of the Company, as amended and approved by the stockholders (1)
|
Exhibit 4.3 to the Company’s Registration Statement on Form S-8, filed with the SEC on March 2, 2005
|
||||
10.3
|
Form of Incentive Stock Option Grant Letter for use in connection with the Company’s 1997 Stock Option Plan (**)
|
Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 4, 2005
|
||||
10.4
|
Form of Non-qualified Stock Option Grant Letter for use in connection with the Company’s 1997 Stock Option Plan (**)
|
Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 19, 2006
|
||||
10.5
|
Director Compensation Plan, effective June 10, 2005 (1)
|
Exhibit 10.2 to the Company’s Quarterly Report Form 10-Q for the quarterly period ended June 30, 2005, filed with the SEC on August 9, 2005
|
||||
10.6
|
Employment Agreement dated January 10, 2006 between the Company and Les M. Taeger (1)
|
Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on January 11, 2006 (the “January 11
th
8-K”)
|
||||
10.7
|
Intellectual Property, Confidentiality and Non-Competition Agreement between the Company and Les M. Taeger dated January 10, 2006 (1)
|
Exhibit 10.2 to the January 11
th
8-K
|
||||
10.8
|
Common Stock and Warrant Purchase Agreement by and between OrthoLogic Corp. and PharmaBio Development Inc., dated February 24, 2006.
|
Exhibit 10.1 to the Company’s Registration Statement on Form S-3 filed with the SEC on April 13, 2006 (April 2006 S-3)
|
10.9
|
Registration Rights Agreement by and between OrthoLogic Corp. and PharmaBio Development Inc., dated February 24, 2006
|
Exhibit 4.8 to the Company’s Amendment No. 1 to Registration Statement on Form 8-A/A, filed with the SEC on May 25, 2010.
|
||||
10.10
|
Registration Rights Agreement by and between OrthoLogic Corp., AzERx, Inc., and Certain Shareholders, dated February 27, 2006
|
Exhibit 10.3 to the Company’s April 2006 S-3
|
||||
10.11
|
Amended and Restated License Agreement dated February 23, 2006 by and between OrthoLogic Corp. and Arizona Science Technology Enterprises, LLC
|
Exhibit 10.5 to the Company’s Registration Statement on Form S-3 filed with the SEC on April 25, 2006
|
||||
10.12
|
2005 Equity Incentive Plan (2005 Plan) (1)
|
Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on May 18, 2006
|
||||
10.13
|
Form of Incentive Stock Option Grant Letters for Grants under the 2005 Plan (**)
|
Exhibit 10.1 to the Company’s Report on Form 10-Q for the quarterly period ended June 30, 2006, filed on August 8, 2006 (“June 2006 10-Q”)
|
||||
10.14
|
Form of Non-Qualified Stock Options Grant Letter for Grants under the 2005 Plan (**)
|
Exhibit 10.2 to the Company’s June 2006 10-Q
|
||||
10.15
|
Form of Restricted Stock Grant Letters for Grants under the 2005 Plan (**)
|
Exhibit 10.4 to the Company’s Current Report on Form 8-K filed with the SEC on May 18, 2006
|
||||
10.16
|
Amendment to Employment Agreement dated January 10, 2006 between OrthoLogic Corp. and Les Taeger (1)
|
Exhibit 10.3 to the Company’s June 2006 10-Q
|
||||
10.17
|
Contribution Agreement by and among LipimetiX, LLC, Capstone Therapeutics Corp., LipimetiX Development, LLC, The UAB Research Foundation, Dennis I. Goldberg, Ph.D. (“Goldberg”), Philip M. Friden, Ph.D., Eric Morrell, Ph.D., G. M. Anantharamaiah, Ph.D. and Palgunachari Mayakonda, Ph.D., Frederick Meyer, Ph.D., Michael Webb, and Jeffrey Elton, Ph.D., effective as of August 3, 2012.
|
Exhibit 10.1 to the Company’s Quarterly Report on form 10-Q for the period ended June 30, 2012, filed with the SEC on August 10, 2012
|
||||
10.18
|
Limited Liability Company Agreement of LipimetiX Development, LLC, by and among LipimetiX Development, LLC, Capstone Therapeutics Corp., and the other members and managers party thereto, effective as of August 3, 2012.
|
Exhibit 10.2 to the Company’s Quarterly Report on form 10-Q for the period ended June 30, 2012, filed with the SEC on August 10, 2012
|
||||
10.19
|
First Amendment and Consent to Assignment of Exclusive License Agreement by and among The UAB Research Foundation, LipimetiX, LLC and LipimetiX Development, LLC, dated as of August 3, 2012.
|
Exhibit 10.3 to the Company’s Quarterly Report on form 10-Q for the period ended June 30, 2012, filed with the SEC on August 10, 2012
|
||||
10.20
|
Management Agreement by and among LipimetiX Development, LLC, Benu BioPharma, Inc., Dennis I. Goldberg, Ph.D., Phillip M. Friden, Ph.D., and Eric M. Morrel, Ph.D., effective as of August 3, 2012.
|
Exhibit 10.4 to the Company’s Quarterly Report on form 10-Q for the period ended June 30, 2012, filed with the SEC on August 10, 2012
|
||||
10.21
|
Accounting Services Agreement by and among LipimetiX Development, LLC and Capstone Therapeutics Corp., effective as of August 3, 2012.
|
Exhibit 10.5 to the Company’s Quarterly Report on form 10-Q for the period ended June 30, 2012, filed with the SEC on August 10, 2012
|
||||
10.22
|
Escrow Agreement by and among Capstone Therapeutics Corp., LipimetiX Development, LLC dated as of August 3, 2012
|
Exhibit 10.6 to the Company’s Quarterly Report on form 10-Q for the period ended June 30, 2012, filed with the SEC on August 10, 2012
|
10.23
|
Exclusive License Agreement between the UAB Research Foundation and LipimetiX LLC dated August 26, 2011
|
Exhibit 10.7 to the Company’s Quarterly Report on form 10-Q for the period ended June 30, 2012, filed with the SEC on August 10, 2012
|
||||
10.24
|
Capstone Therapeutics Corp. Joint Venture Bonus Plan
|
Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the period ended September 30, 2012, filed with the SEC on November 8, 2012
|
||||
10.25
|
Accounting Services Agreement Amendment #1, dated August 23, 2013
|
Exhibit 10.1 to the Company’s Quarterly Report on form 10-Q for the period ended September 30, 2013, filed with the SEC on November 12, 2013
|
||||
23.1
|
Consent of independent registered public accounting firm.
|
X
|
||||
31.1
|
Certification of Principal Executive Officer Pursuant to Rule 13a -14(a) of the Securities Exchange Act of 1934, as amended
|
X
|
||||
31.2
|
Certification of Principal Financial and Accounting Officer Pursuant to Rule 13a - 14(a) of the Securities Exchange Act of 1934, as amended
|
X
|
||||
32.1
|
Certification of Principal Executive Officer and Principal Financial and Accounting Officer Pursuant to 18 U.S.C. Section 1350***
|
X
|
||||
101
|
The following financial information from our Annual Report on Form 10-K for the fiscal year 2013, filed with the SEC on March 27, 2014 formatted in Extensible Business Reporting Language (XBRL): (i) the Consolidated Balance Sheets as December 31, 2013 and 2012, (ii) the Consolidated Statements of Operations for the years ended 2013 and 2012 and one hundred and thirteen months ended December 31, 2013, (iii) the Consolidated Statements of Cash Flows for the two years ended December 31, 2013 and 2012 and the one hundred and thirteen months ended December 31, 2012, and (iv) Notes to Consolidated Financial Statements. ***
|
X |
(1)
|
Management contract or compensatory plan or arrangement.
|
*
|
Capstone Therapeutics Corp. has entered into separate indemnification agreements with each of its current directors and executive officers that differ only in party names and dates. Pursuant to the instructions accompanying Item 601 of Regulation S-K, Capstone has filed the form of such indemnification agreement.
|
**
|
Capstone Therapeutics from time to time issues stock options to its employees, officers and directors pursuant to its 1997 and 2005 Stock Option Plan, as amended. The incentive stock option grant letters and non-qualified stock option grant letters that evidence these issuances differ only in such terms as the identity of the recipient, the grant date, the number of securities covered by the award, the price(s) at which the recipient may acquire the securities and the vesting schedule. Pursuant to the instructions accompanying Item 601 of Regulation S-K, Capstone has filed the form of such incentive stock option grant letter and non-qualified stock option grant letter.
|
***
|
Furnished herewith.
|
/s/ Moss Adams LLP
|
December 31,
|
December 31,
|
|||||||
2013
|
2012
|
|||||||
ASSETS
|
||||||||
Current assets
|
||||||||
Cash and cash equivalents, $2,042 reserved at December 31, 2013
|
$ | 6,258 | $ | 10,205 | ||||
Other current assets
|
233 | 383 | ||||||
Total current assets
|
6,491 | 10,588 | ||||||
Patent license rights, net
|
823 | 980 | ||||||
Furniture and equipment, net
|
3 | 23 | ||||||
Total assets
|
$ | 7,317 | $ | 11,591 | ||||
LIABILITIES AND EQUITY
|
||||||||
Current liabilities
|
||||||||
Accounts payable
|
$ | 88 | $ | 233 | ||||
Other accrued liabilities
|
12 | 61 | ||||||
Total current liabilities
|
100 | 294 | ||||||
Equity
|
||||||||
Capstone Therapeutics Corp. Stockholders' Equity
|
||||||||
Common Stock $.0005 par value;
|
20 | 20 | ||||||
100,000,000 shares authorized; 40,885,411 shares in 2013
|
||||||||
and 2012
|
||||||||
Additional paid-in capital
|
189,215 | 189,181 | ||||||
Accumulated deficit ($154,256 at December 31, 2013 and
|
||||||||
$150,335 at December 31, 2012, accumulated during
|
||||||||
development stage period)
|
(182,018 | ) | (178,097 | ) | ||||
Total Capstone Therapeutics Corp. stockholders' equity
|
7,217 | 11,104 | ||||||
Noncontrolling interest
|
- | 193 | ||||||
Total equity
|
7,217 | 11,297 | ||||||
Total liabilities and equity
|
$ | 7,317 | $ | 11,591 |
As a Development
|
||||||||||||
Years ended December 31,
|
Stage Company
|
|||||||||||
August 5, 2004 -
|
||||||||||||
2013
|
2012
|
December 31, 2013
|
||||||||||
OPERATING EXPENSES
|
||||||||||||
General and administrative
|
$ | 1,169 | $ | 1,764 | $ | 32,655 | ||||||
Research and development
|
3,124 | 2,385 | 105,558 | |||||||||
Purchased in-process research and development
|
- | - | 34,311 | |||||||||
Other
|
- | - | (375 | ) | ||||||||
Total operating expenses
|
4,293 | 4,149 | 172,149 | |||||||||
Interest and other income, net
|
(158 | ) | (96 | ) | (14,011 | ) | ||||||
Loss from continuing operations before taxes
|
4,135 | 4,053 | 158,138 | |||||||||
Income tax benefit
|
(21 | ) | - | (1,376 | ) | |||||||
Loss from continuing operations
|
4,114 | 4,053 | 156,762 | |||||||||
Discontinued operations - net gain on sale of
|
||||||||||||
the bone device business, net of taxes of $267
|
- | - | (2,202 | ) | ||||||||
Net Loss
|
4,114 | 4,053 | 154,560 | |||||||||
Less: Net Loss attributable to the noncontrolling
|
||||||||||||
interest
|
(193 | ) | (473 | ) | (667 | ) | ||||||
Net Loss attributable to Capstone Therapeutics
|
||||||||||||
Corp. stockholders
|
$ | 3,921 | $ | 3,580 | $ | 153,893 | ||||||
Per Share Information:
|
||||||||||||
Net loss, basic and diluted, attributable to
|
||||||||||||
Capstone Therapeutics Corp. stockholders
|
$ | 0.10 | $ | 0.09 | ||||||||
Basic and diluted shares outstanding
|
40,885 | 40,879 |
CAPSTONE THERAPEUTICS CORP.
|
(A Development Stage Company)
|
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
|
(in thousands)
|
Capstone Therapeutics Corp. Stockholders' Equity
|
||||||||||||||||||||||||||||
Potentially
|
Non
|
|||||||||||||||||||||||||||
Redeemable
|
Common Stock
|
Additional
|
Accumulated
|
controlling
|
||||||||||||||||||||||||
Equity
|
Shares
|
Amount
|
Paid in Capital
|
Deficit
|
Interest
|
Total
|
||||||||||||||||||||||
Balance August 5, 2004 (prior to the acquisition of CBI)
|
$ | - | 34,550 | $ | 17 | $ | 146,125 | $ | (27,762 | ) | $ | - | $ | 118,380 | ||||||||||||||
Acquisition of CBI, August 5, 2004
|
- | 3,248 | 2 | 23,451 | - | - | 23,453 | |||||||||||||||||||||
Acquisition of AzERx, February 27, 2006
|
- | 1,355 | 1 | 7,763 | - | - | 7,764 | |||||||||||||||||||||
Exercise of common stock options
|
- | 997 | - | 4,579 | - | - | 4,579 | |||||||||||||||||||||
Stock-based compensation cost
|
- | - | - | 3,505 | - | - | 3,505 | |||||||||||||||||||||
Compensation earned on stock awards
|
- | 494 | - | 1,200 | - | - | 1,200 | |||||||||||||||||||||
Sale of common stock
|
- | 1,263 | 1 | 3,375 | - | - | 3,376 | |||||||||||||||||||||
Common stock purchased and retired
|
- | (1,132 | ) | (1 | ) | (1,040 | ) | - | - | (1,041 | ) | |||||||||||||||||
Recognized uncertain tax position
|
- | - | - | - | (363 | ) | - | (363 | ) | |||||||||||||||||||
Reclassification of share-based awards liability
|
- | - | - | 116 | - | - | 116 | |||||||||||||||||||||
Recognition of potentially redeemable equity,
|
- | - | ||||||||||||||||||||||||||
net of amortization
|
15,556 | - | - | - | (15,556 | ) | - | (15,556 | ) | |||||||||||||||||||
De-recognition of potentially redeemable equity,
|
- | - | ||||||||||||||||||||||||||
net of amortization
|
(15,556 | ) | - | - | - | 15,556 | - | 15,556 | ||||||||||||||||||||
Net loss August 5, 2004 through December 31, 2011
|
- | - | - | - | (146,392 | ) | - | (146,392 | ) | |||||||||||||||||||
Balance December 31, 2011
|
40,775 | 20 | 189,074 | (174,517 | ) | - | 14,577 | |||||||||||||||||||||
Formation of Joint Venture
|
- | - | - | - | - | 666 | 666 | |||||||||||||||||||||
Stock-based compensation cost
|
- | 110 | - | 107 | - | - | 107 | |||||||||||||||||||||
Net loss
|
- | - | - | - | (3,580 | ) | (473 | ) | (4,053 | ) | ||||||||||||||||||
Balance December 31, 2012
|
- | 40,885 | 20 | 189,181 | (178,097 | ) | 193 | 11,297 | ||||||||||||||||||||
Stock-based compensation cost
|
- | - | - | 34 | - | - | 34 | |||||||||||||||||||||
Net loss
|
- | - | - | - | (3,921 | ) | (193 | ) | (4,114 | ) | ||||||||||||||||||
Balance December 31, 2013
|
$ | - | 40,885 | $ | 20 | $ | 189,215 | $ | (182,018 | ) | $ | - | $ | 7,217 |
As a
|
||||||||||||
Development
|
||||||||||||
Stage Company
|
||||||||||||
Years Ended December 31,
|
August 5, 2004 -
|
|||||||||||
2013
|
2012
|
December 31, 2013
|
||||||||||
OPERATING ACTIVITIES
|
||||||||||||
Net loss
|
$ | (4,114 | ) | $ | (4,053 | ) | $ | (154,560 | ) | |||
Non cash items:
|
||||||||||||
Deferred tax expense
|
- | - | 770 | |||||||||
Depreciation and amortization
|
173 | 29 | 4,144 | |||||||||
Non-cash stock-based compensation
|
34 | 107 | 4,965 | |||||||||
Gain on sale of bone device business
|
- | - | (2,298 | ) | ||||||||
In-process research and development
|
- | - | 34,311 | |||||||||
Change in other operating items:
|
||||||||||||
Interest, income taxes and other current assets
|
150 | 375 | 1,475 | |||||||||
Accounts payable
|
(145 | ) | 156 | (883 | ) | |||||||
Accrued liabilities
|
(49 | ) | 19 | (3,004 | ) | |||||||
Cash flows used in operating activities
|
(3,951 | ) | (3,367 | ) | (115,080 | ) | ||||||
INVESTING ACTIVITIES
|
||||||||||||
Expenditures for furniture and equipment, net
|
- | - | (1,044 | ) | ||||||||
Proceeds from sale of assets
|
4 | 172 | 7,176 | |||||||||
Cash paid for assets of AzERx/CBI
|
- | - | (4,058 | ) | ||||||||
Cash paid for patent rights
|
- | (378 | ) | (1,028 | ) | |||||||
Purchases of investments
|
- | - | (282,538 | ) | ||||||||
Maturities of investments
|
- | - | 340,476 | |||||||||
Cash flows provided by (used in) investing activities
|
4 | (206 | ) | 58,984 | ||||||||
FINANCING ACTIVITIES
|
||||||||||||
Net proceeds from stock option exercises
|
- | - | 4,612 | |||||||||
Net proceeds from sale of stock
|
- | - | 3,376 | |||||||||
Common stock purchases
|
- | - | (1,041 | ) | ||||||||
Cash flows provided by financing activities
|
- | - | 6,947 | |||||||||
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
(3,947 | ) | (3,573 | ) | (49,149 | ) | ||||||
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD
|
10,205 | 13,778 | 55,407 | |||||||||
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
$ | 6,258 | $ | 10,205 | $ | 6,258 | ||||||
Supplemental Disclosure of Non-Cash Investing Activities -
|
LipimetiX
|
LipimetiX/AzERx/CBI
|
||||||||||
LipimetiX/AzERx/CBI Acquisitions:
|
||||||||||||
Current assets acquired
|
$ | - | $ | 29 | ||||||||
Patent rights acquired
|
1,045 | 3,187 | ||||||||||
Liabilities acquired, and accrued acquisition costs
|
- | (457 | ) | |||||||||
Original investment reversal
|
- | (750 | ) | |||||||||
In-process research and development acquired
|
- | 34,311 | ||||||||||
Noncontrolling interest
|
(667 | ) | (667 | ) | ||||||||
Common stock issued for acquisition
|
- | (31,217 | ) | |||||||||
Cash paid
|
$ | 378 | $ | 4,436 |
1.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
2.
|
INVESTMENTS
|
3.
|
FURNITURE AND EQUIPMENT
|
December 31,
|
||||||||
2013
|
2012
|
|||||||
Machinery and equipment
|
$ | 221 | $ | 601 | ||||
Furniture and fixtures
|
34 | 57 | ||||||
Leasehold improvements
|
- | 36 | ||||||
255 | 694 | |||||||
Less accumulated depreciation and amortization
|
(252 | ) | (671 | ) | ||||
Total
|
$ | 3 | $ | 23 |
4.
|
INCOME TAXES
|
December 31,
|
||||||||
2013
|
2012
|
|||||||
Accruals and reserves
|
$ | 1 | $ | 1 | ||||
Valuation allowance
|
(1 | ) | (1 | ) | ||||
Total current
|
- | - | ||||||
NOL, AMT and general business
credit carryforwards
|
56,050 | 55,039 | ||||||
Difference in basis of fixed assets
|
3 | 114 | ||||||
Accruals and reserves
|
274 | 522 | ||||||
Difference in basis of intangibles
|
13 | 13 | ||||||
Valuation allowance
|
(56,340 | ) | (55,688 | ) | ||||
Total non current
|
- | - | ||||||
Total deferred income taxes
|
$ | - | $ | - |
As a
|
||||||||||||
Development
|
||||||||||||
Stage Company
|
||||||||||||
Years Ended December 31
|
August 5, 2004 -
|
|||||||||||
2013
|
2012
|
December 31, 2013
|
||||||||||
Provision (benefit) for income taxes
|
||||||||||||
Current
|
$ | (21 | ) | $ | - | $ | (2,482 | ) | ||||
Deferred
|
- | - | 1,106 | |||||||||
Income tax provision (benefit)
|
$ | (21 | ) | $ | - | $ | (1,376 | ) |
As a
|
||||||||||||
Development
|
||||||||||||
Stage Company
|
||||||||||||
Years Ended December 31
|
August 5, 2004 -
|
|||||||||||
2013
|
2012
|
December 31, 2013
|
||||||||||
Income tax provision (benefit) at statutory rate
|
$ | (1,333 | ) | $ | (1,217 | ) | $ | (53,531 | ) | |||
State income taxes
|
(138 | ) | (165 | ) | (6,096 | ) | ||||||
Purchased in-process
|
||||||||||||
research and development
|
- | - | 12,533 | |||||||||
Research credits
|
(74 | ) | 9 | (6,013 | ) | |||||||
Change in uncertain tax position reserve
|
- | - | (363 | ) | ||||||||
Expiration of state NOL
|
548 | 450 | 4,029 | |||||||||
Other
|
324 | 472 | 2,345 | |||||||||
Change in valuation allowance
|
652 | 451 | 45,720 | |||||||||
Net provision (benefit)
|
$ | (21 | ) | $ | - | $ | (1,376 | ) |
5.
|
STOCKHOLDERS’ EQUITY
|
2013
|
2012
|
|||||
Risk free interest rate
|
0.7%
|
0.8%
|
||||
Volatility
|
77%
|
74%
|
||||
Expected term from vesting
|
4.6 Years
|
4.0 Years
|
2013
|
2012
|
||||||||||||||||||
Weighted
|
|||||||||||||||||||
Weighted
|
average
|
Weighted
|
|||||||||||||||||
average
|
remaining
|
average
|
|||||||||||||||||
Number of
|
exercise
|
contractual term
|
Number of
|
exercise
|
|||||||||||||||
Options
|
price
|
(years)
|
Options
|
price
|
|||||||||||||||
Options outstanding
|
|||||||||||||||||||
at the beginning of the year:
|
3,218,264 | $ | 1.71 | 3,372,501 | $ | 2.08 | |||||||||||||
Granted
|
255,000 | $ | 0.22 | 595,000 | $ | 0.17 | |||||||||||||
Exercised
|
- | $ | - | - | |||||||||||||||
Expired / Forfeited
|
(247,458 | ) | $ | 2.65 | (749,237 | ) | $ | 2.16 | |||||||||||
Outstanding at end of year
|
3,225,806 | $ | 1.52 | 4.96 | 3,218,264 | $ | 1.71 | ||||||||||||
Options exercisable at year-end
|
3,115,384 | $ | 1.57 | 4.77 | 3,083,680 | $ | 1.78 | ||||||||||||
Options vested and expected
|
|||||||||||||||||||
to vest at year end
|
3,150,504 | $ | 1.55 | 4.83 | 3,123,618 | $ | 1.76 |
6.
|
COMMITMENTS
|
7.
|
401(K) PLAN
|
8.
|
AUTHORIZED PREFERRED STOCK
|
9.
|
AUTHORIZATION OF COMPANY BUY-BACK OF COMMON STOCK
|
10.
|
JOINT VENTURE FOR DEVELOPMENT OF APO E MIMETIC
PEPTIDE MOLECULE AEM-28 AND ANALOGS
|
Patent license rights
|
$ | 1,045 | ||||
Noncontrolling interests
|
$ | ( 667 | ) | |||
Cash paid at formation
|
$ | 378 |
11.
|
CONTINGENCY – LEGAL PROCEEDINGS
|
1 Year Capstone Therapeutics (QB) Chart |
1 Month Capstone Therapeutics (QB) Chart |
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