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18. Pro Forma Financials for Acquisition of Canterbury, Hygeia, Paloma and VasculoMedics | 3 Months Ended
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Mar. 31, 2014
Business Combinations [Abstract] |
18. Pro Forma Financials for Acquisition of Canterbury, Hygeia, Paloma and VasculoMedics | The Company acquired Canterbury and Hygeia on November 18, 2013 and 1,150,115 shares were issued to the stakeholders of Canterbury and Hygeia. On March 28, 2014, the Company acquired Paloma and issued an aggregate of 2,500,000 common shares to the holders of Paloma Common Stock and its derivative securities and assumed promissory notes of Paloma in the aggregate amount (principal and interest) currently of approximately $1,130,500 to be paid on the first anniversary of the closing of the Paloma merger. The VasculoMedics Merger also closed on March 28, 2014, with the Company issuing an aggregate of 220,000 common shares to the VasculoMedics stakeholders. The balance sheet as of December 31, 2013 consolidated the accounts of Canterbury and Hygeia and the balance sheet as of March 31, 2014 consolidated the accounts of Canterbury, Hygeia, Paloma and VasculoMedics. The income statement for the three months ended March 31, 2014 consolidated the accounts of Canterbury and Hygeia, along with the accounts of Paloma and VasculoMedics for activity between March 28, 2014 and March 31, 2014. The income statement for the three months ended March 31, 2013 did not include Canterbury, Hygeia, Paloma or VasculoMedics The following pro forma financial information has been prepared as if the mergers with Paloma and VasculoMedics had occurred on January 1, 2014. The information in these pro forma financials for Paloma and VasculoMedics has been derived from the unaudited financial statements for Paloma and VasculoMedics for the three months ended March 31, 2014. The information in these pro forma financials for RestorGenics has been derived from the unaudited financial statements for the three months ended March 31, 2014. RestorGenex Corporation, Canterbury and Hygeia Pro Forma Statements of Operations Three Months Ended March 31, 2014
|  | Three Months Ended March 31, 2014 (a) |
|  |  |  |  |  |  |  |  |  |  | Pro Forma |  |  | Pro Forma |
|  | RestorGenex |  |  | Paloma |  |  | VasculoMedics |  |  | Adjustments |  |  | Combined |
Revenues |  | $ | – |  |  | $ | – |  |  | $ | – |  |  | $ | – |  |  | $ | – |
Cost of revenues |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |
Gross profit |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |
Operating expenses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
General, administrative, research and development |  |  | 611,845 |  |  |  | 102,153 |  |  |  | – |  |  |  | 81,250 | (b) |  |  | 795,248 |
Warrants, options and stock compensation |  |  | 149,885 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 149,885 |
Legal and professional services |  |  | 131,686 |  |  |  | 1,725 |  |  |  | – |  |  |  | – |  |  |  | 133,411 |
Depreciation and amortization |  |  | 478,104 |  |  |  | 634 |  |  |  | – |  |  |  | 27,755 | (c) |  |  | 506,493 |
Total operating expenses |  |  | 1,371,520 |  |  |  | 104,512 |  |  |  | – |  |  |  | 109,005 |  |  |  | 1,585,037 |
Loss from operations |  |  | (1,371,520 | ) |  |  | (104,512 | ) |  |  | – |  |  |  | (109,005 | ) |  |  | (1,585,037 | )
Other (income)/expenses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Other income |  |  | (49,639 | ) |  |  | (25,397 | ) |  |  | – |  |  |  | – |  |  |  | (75,036 | )
Interest expense |  |  | 58,294 |  |  |  | 29,925 |  |  |  | – |  |  |  | – |  |  |  | 88,219 |
Total other expenses |  |  | 8,655 |  |  |  | 4,528 |  |  |  | – |  |  |  | – |  |  |  | 13,183 |
Net loss from continuing operations |  |  | (1,380,175 | ) |  |  | (109,040 | ) |  |  | – |  |  |  | (109,005 | ) |  |  | (1,598,220 | )
Net loss from discontinued operations |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |
Net loss |  | $ | (1,380,175 | ) |  | $ | (109,040 | ) |  | $ | – |  |  | $ | (109,005 | ) |  | $ | (1,598,220 | )
Basic and diluted loss per share |  | $ | (0.23 | ) |  |  | – |  |  |  | – |  |  |  | – |  |  | $ | (0.18 | )
Basic and fully-diluted weighted average shares outstanding |  |  | 5,934,474 |  |  |  | 2,500,000 | (d) |  |  | 220,000 | (d) |  |  | – |  |  |  | 8,654,474 |
(a) |  | Assumes the mergers with Paloma and VasculoMedics occurred on January 1, 2014.
(b) |  | Impact of employment agreements from January 1, 2014 to March 31, 2014.
(c) |  | Amortization of intangible assets for Paloma assuming a 20-year amortization period.
(d) |  | Impact on weighted average shares outstanding for the acquisition shares being outstanding for the entire quarter.
The following pro forma financial information has been prepared as if the mergers with Canterbury, Hygeia, Paloma and VasculoMedics had occurred on January 1, 2014. The information in these pro forma financials for Paloma and VasculoMedics has been derived from the unaudited financial statements for Canterbury, Hygeia, Paloma and VasculoMedics for the three months ended March 31, 2014. The information in these pro forma financials for Stratus has been derived from the unaudited financial statements for the three months ended March 31, 2014. RestorGenex Corporation, Canterbury, Hygeia, Paloma and VasculoMedics Pro Forma Income Statements For the Three Months Ended March 31, 2013
|  | Three Months Ended March 31, 2013 (a) |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | Pro Forma |  |  | Pro Forma |
|  | RestorGenex |  |  | Canterbury |  |  | Hygeia |  |  | Paloma |  |  | VasculoMedics |  |  | Adjustments |  |  | Combined |
Revenues |  | $ | – |  |  | $ | 46,155 |  |  | $ | – |  |  | $ | – |  |  | $ | – |  |  | $ | – |  |  | $ | 46,155 |
Cost of revenues |  |  | – |  |  |  | 54,765 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 54,765 |
Gross profit |  |  | – |  |  |  | (8,610 | ) |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (8,610 | )
Operating expenses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
General, administrative, research and development |  |  | 624,674 |  |  |  | 31,331 |  |  |  | – |  |  |  | 47,880 |  |  |  | – |  |  |  | 848,732 | (b) |  |  | 1,552,617 |
Warrants, options and stock |  |  | 1,316,148 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 1,316,148 |
Legal and professional services |  |  | 143,103 |  |  |  | 25,435 |  |  |  | – |  |  |  | 17,254 |  |  |  | – |  |  |  | – |  |  |  | 185,792 |
Depreciation and amortization |  |  | 8,687 |  |  |  | 4,212 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 687,713 | (c) |  |  | 700,612 |
Total operating expenses |  |  | 2,092,612 |  |  |  | 60,978 |  |  |  | – |  |  |  | 65,134 |  |  |  | – |  |  |  | 1,536,445 |  |  |  | 3,755,169 |
Loss from operations |  |  | (2,092,612 | ) |  |  | (69,588 | ) |  |  | – |  |  |  | (65,134 | ) |  |  | – |  |  |  | (1,536,445 | ) |  |  | (3,763,779 | )
Other (income)/expenses |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Loss on adjustments to fair value of derivative liability |  |  | 236,850 |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 236,850 |
Other (income)/expenses |  |  | (2,564 | ) |  |  | – |  |  |  | – |  |  |  | (63,910 | ) |  |  | – |  |  |  | – |  |  |  | (66,474 | )
Interest expense |  |  | 22,971 |  |  |  | 2,358 |  |  |  | – |  |  |  | 20,781 |  |  |  | – |  |  |  | – |  |  |  | 46,110 |
Total other (income)/expenses |  |  | 257,257 |  |  |  | 2,358 |  |  |  | – |  |  |  | (43,129 | ) |  |  | – |  |  |  | – |  |  |  | (216,486 | )
Net loss from continuing operations |  |  | (2,349,869 | ) |  |  | (71,946 | ) |  |  | – |  |  |  | (22,005 | ) |  |  | – |  |  |  | (1,536,445 | ) |  |  | (3,980,265 | )
Net loss from discontinued operations |  |  | (126,911 | ) |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | (126,911 | )
Net loss |  | $ | (2,476,780 | ) |  | $ | (71,946 | ) |  | $ | – |  |  | $ | (22,005 | ) |  | $ | – |  |  | $ | (1,536,445 | ) |  | $ | (4,107,176 | )
Basic and diluted earnings per share |  | $ | (2.77 | ) |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | – |  |  | $ | (0.86 | )
Basic weighted average shares outstanding |  |  | 892,534 |  |  |  | 1,150,116 | (d) |  |  | – |  |  |  | 2,500,000 | (d) |  |  | 220,000 | (d) |  |  | – |  |  |  | 4,762,650 |
Fully-diluted weighted average shares outstanding |  |  | 1,207,534 |  |  |  | 1,150,116 | (d) |  |  | – |  |  |  | 2,500,000 | (d) |  |  | 220,000 | (d) |  |  | – |  |  |  | 5,077,650 |
(a) | Assumes the mergers with Canterbury, Hygeia, Paloma and VasculoMedics occurred on January 1, 2013.
(b) | Adds the $848,732 of expenses associated with employment agreements for Canterbury and Paloma executives that would be incurred from January 1, 2013.
(c) | Adds $659,958 of additional amortization for intangible assets at Canterbury and $27,755 for Paloma (assuming at 20-year amortization period) that would be incurred if amortization began on January 1, 2013.
(d) | Impact on weighted average shares if the 1,150,116 shares issued for the mergers with Canterbury and Hygeia, the 2,500,000 shares issued for the Paloma merger and the 220,000 shares issued for the VasculoMedics merger were outstanding for the quarter.

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