ForceField Energy Inc. - FORM 8-K/A - EX-99.2 - March 23, 2011

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SunSi Energies Inc.

INTRODUCTION TO PRO-FORMA CONSOLIDATED FINANCIAL STATEMENTS
AS OF
THE FISCAL YEAR ENDED MAY 31, 2010
AND
THE SIX MONTH PERIOD ENDED NOVEMBER 30, 2010

On December 8, 2010, the Company completed its acquisition of 90% of Zibo Baokai Trade Co. (“Baokai”), a company with the exclusive right to distribute the trichlorisilane production of Zibo Commerce and Trade Co. (“ZBC”) in the China market.

We expect the cost of the acquisition to be approximately $270,000. This acquisition will enable SunSi to generate revenue and to create a presence within the Chinese and other international TCS markets.

With this acquisition, SunSi now owns the exclusive distribution rights to 100% of ZBC’s production both internationally and domestically; however, we will not have any interest or ownership position in the ZBC factory.

As part of the Baokai distribution rights, ZBC has agreed to sell all of its TCS production to us at a price of cost, plus a 10%-15% mark-up. The resale price of the TCS will be determined at our discretion.

The following unaudited pro-forma income statements and the explanatory notes give effect to the acquisition by SunSi of Baokai on December 8, 2010.

The pro-forma consolidated income statements and balance sheet and explanatory notes are based on the estimates and assumptions set forth in the explanatory notes. These pro-forma consolidated income statements have been prepared utilizing the historical financial statements of SunSi and Baokai and should be read in conjunction with the historical financial statements and notes thereto included elsewhere in this filing.

The pro-forma income statements have been prepared as if the acquisition had occurred on June 1, 2009. This pro-forma consolidated financial data is provided for comparative purposes only, and does not purport to be indicative of the actual financial position or results of operations had the acquisition occurred at the beginning of the periods presented, nor are they necessarily indicative of the results of future operations.
 
 
 
 
 
Sunsi Energies, Inc.
Unaudited Balance Sheet
for the Year ended May 31, 2010

   
Sunsi
    
Zibo Baoaki
    
Adjustments
    
Consolidated
  
   
Energies, Inc.
    
Trade Co. Ltd
              
   
2010
    
2010
          
2010
  
ASSETS
                        
Current assets
                        
Cash and cash equivalents
  
$
598,468
    
$
63,452
    
$
(270,000
)(b)
  
$
391,920
  
Inventory
    
-
      
210,341
              
210,341
  
Tax receivabe
    
-
      
32,784
              
32,784
  
Other receivable
    
-
      
117,165
              
117,165
  
Total current assets
    
598,468
      
423,742
      
(270,000
)
    
752,210
  
Related party receivable
    
-
      
408,084
              
408,084
  
Total assets
  
$
598,468
    
$
831,826
      
(270,000
)
  
$
1,160,294
  
                                 
LIABILITIES AND STOCKHOLDERS' EQUITY
                                
Current liabilities
                                
Accounts payable and accrued liabilities
  
$
149,538
    
$
134,926
        
(a)
  
$
284,464
  
Other payable
    
-
      
320,738
              
320,738
  
Related party payable
    
-
      
73,228
              
73,228
  
Advances payable
    
230,981
      
-
              
230,981
  
Compensation payable-related party
    
5,671
      
-
              
5,671
  
Total current liabilities
    
386,190
      
528,892
      
-
      
915,082
  
                                 
Minority interest
    
-
      
-
      
1,448
      
1,448
  
                                 
Stockholders' equity
                                
Common stock, $0.001 par value, 75,000,000 shares authorized, 27,312,500and 26,760,000 issued and outstanding in 2010 and 2009, respectively
    
27,312
      
-
              
27,312
  
Additional paid-in capital
    
1,018,764
      
287,886
      
(270,000
)(b)
    
1,036,650
  
Accumulated deficit
    
(833,798
)
    
10,210
      
(1,448
)(a)
    
(825,036
)
Accumulated othe comprehensive income
    
-
      
4,838
              
4,838
  
Total stockholders' equity
    
212,278
      
302,934
      
(271,448
)
    
243,764
  
Total liabilities and stockholders' equity
  
$
598,468
    
$
831,826
    
$
(270,000
)
  
$
1,160,294
  

(a) to record liability for minority interest
(b) to reflect the net impact of the purchase price that SunSi paid for Baokai
 
 
 
 

Sunsi Energies, Inc.
Unaudited Proforma Statement of Operations
and Comprehensive Income for the Year ended
May 31, 2010

   
Historical
              
   
Sunsi
    
Zibo Baoaki
          
Combined
  
   
Energies, Inc.
    
Trade Co. Ltd
    
Adjustments
    
Pro Forma
  
                         
Sales
  
$
-
      
483,148
      
-
    
$
483,148
  
Cost of goods sold
    
-
      
433,386
      
-
      
433,386
  
Gross margin
    
-
      
49,762
      
-
      
49,762
  
Operating expenses
                                
Selling,general and administrative
    
40,854
      
35,336
      
-
      
76,190
  
Professional and outside services
    
580,981
      
-
      
-
      
580,981
  
Total operating expenses
    
621,835
      
35,336
      
-
      
657,171
  
Loss from operations
    
(621,835
)
    
14,426
      
-
      
(607,409
)
Other expense
                                
Interest income
    
-
      
477
      
-
      
477
  
Total other expense
    
-
      
477
      
-
      
477
  
Loss before income taxes
    
(621,835
)
    
14,903
      
-
      
(606,932
)
Income taxes
    
-
      
615
      
-
      
615
  
Net income
    
(621,835
)
    
14,288
              
(607,547
)
Other comprehensive income:
                                
Foreign currency translation adjustments
    
-
      
190
              
190
  
Total comprehensive income
    
(621,835
)
    
14,478
              
(607,357
)
Less: minority interest Baokai
                    
(1,448
)(a)
    
(1,448
)
Net loss
  
$
(621,835
)
  
$
14,478
    
$
(1,448
)
  
$
(608,805
)
                                 
Loss per share:
                                
Basic and diluted
  
$
(0.02
)
          
$
-
    
$
(0.02
)
                                 
Weighted average number of common shares outstanding:
                                
Basic and diluted
    
26,972,486
              
-
      
26,972,486
  

(a)  Reflects a 10% minority interest in Baokai
 
 
 
 
 
Sunsi Energies, Inc.
Unaudited Proforma Statement of Operations
and Comprehensive Income for the Six-Month period ended
November 30, 2010

UNAUDITED PROFORMA STATEMENTS OF OPERATIONS
                        
AND COMPREHENSIVE INCOME FOR
                        
FOR THE SIX MONTHS ENDED NOVEMBER 30, 2010
                        
                         
                         
                   
   
SunSi Energies, Inc.
    
ZiboBaokai
          
Combined
  
   
(unaudited)
    
(unaudited)(a)
    
Adjustments
    
Pro Forma
  
                         
Sales
     -       -       -       -  
Cost of goods sold
     -       -       -       -  
Gross margin
     -       -       -       -  
Operating expenses
                                
Professional Fees
     322,978       -       -       322,978  
General and administrative expenses
     67,131       -       -       67,131  
Total operating expenses
     390,109       -       -       390,109  
Loss from operations
     (390,109 )     -       -       (390,109 )
Other expense
                                
Other income
     -       -       -       -  
Interest expense
     -       -       -       -  
Total other expense
     -       -       -       -  
Loss before income taxes
     (390,109 )     -       -       (390,109 )
Income taxes
     -       -       -          
Less: minority interest Baokai
     (390,109 )                     -  
Net loss
     (390,109 )     -       -       (390,109 )
                                 
Loss per share:
                                
Basic and diluted
   $ (0.01 )           $ -     $ (0.01 )
                                 
Weighted average number of common shares outstanding:
                                
Basic and diluted
     27,456,180               -       27,456,180  
 
(a) There was no activity at Zibo Baokai for the six month period from June 1, 2010 -through November 30, 2010. Zibo Baokai is a distribution company that distributes trichlorsilane("TCS") produced by the Zibo Commerce and Trade Co. ("ZBC") located in Zibo, China. Once SunSi began performing due diligence on Zibo Baokai, ZBC no longer used Baokai as its TCS distributor pending the outcome of the due diligence. Once SunSi acquired Zibo Baokai on December 9, 2010 it also acquired exclsuive distribution rights from ZBC as part of the transactions. Subsequent to December 9, 2010, all of the TCS produced by ZBC is sold through the Zibo Baokai company which is 90% owned by Sunsi.
 

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