U.S. RARE EARTHS, INC - FORM 8-K - EX-99.2 - SEAGLASS PROFORMA STATEMENTS

Attached files

file	filename
EX-99.1 - SEAGLASS FINANCIAL STATEMENTS 2010 - U.S. RARE EARTHS, INC	ex99-1.htm
8-K - CREI - 8K 070711 - U.S. RARE EARTHS, INC	crei-8k070711.htm

EXHIBIT 99.2

COLORADO RARE EARTHS, INC.
Proforma Consolidated Balance Sheet
(Unaudited)

			As of		As of
			September 30,		December 15,
			2010		2010
			Calypso		Seaglass							Adjusted
			Financial		Holding		Combined		Pro Forma			ProForma
			Services, Inc.		Corp.		Totals		Adjustments		REF	Totals
ASSETS

CURRENT ASSETS

	Cash		$	197,380	$	-	$	197,380	$	-		$	197,380
	Accounts receivable, net			597,880		-		597,880		-			597,880
	Prepaid Expenses			50,000		-		50,000		-			50,000

		Total Current Assets		845,260		-		845,260		-			845,260

		Total Fixed Assets		-		-		-		-			-

PROPERTY AND EQUIPMENT, net				46,873		-		46,873		-			46,873

OTHER ASSETS

	Goodwill			-		-		-		2,624,000	[1]		-
										(2,624,000)	[2]
	Mineral properties			-		18,315		18,315		326,000	[1]		326,000
										(18,315)	[3]

		Total Other Assets		-		18,315		18,315		307,685			326,000

		TOTAL ASSETS	$	892,133	$	18,315	$	910,448	$	307,685		$	1,218,133


LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

CURRENT LIABILITIES
	Accounts payable and accrued expenses		$	272,267	$	-	$	272,267	$	-		$	272,267
	Related party payable			-		962		962		-			962
	Income tax payable			10,492		-		10,492		-			10,492

		Total Current Liabilities		282,759		962		283,721		-			283,721

		TOTAL LIABILITIES		282,759		962		283,721		-			283,721

STOCKHOLDERS' EQUITY

	Preferred stock			-		-		-		-			-
	Common stock			50		5,900		5,950		59	[1]		109
										(5,900)	[3]
	Additional paid-in capital			19,920		12,415		32,335		2,949,941	[1]		2,968,899
										(12,415)	[3]
										(962)	[4]
	Retained earnings (deficit)			589,404		(962)		588,442		(2,624,000)	[2]		(2,034,596)
										962	[4]

		Total Stockholders' Equity		609,374		17,353		626,727		307,685			934,412

		TOTAL LIABILITIES AND
		STOCKHOLDERS' EQUITY (DEFICIT)	$	892,133	$	18,315	$	910,448	$	307,685		$	1,218,133


				-		-		-		-			-

COLORADO RARE EARTHS, INC.
Proforma Consolidated Statements of Operations
For the Nine Months Ended September 30, 2010
(Unaudited)

					For the period
					From Inception on
			For the Nine		December 10, 2010
			Months Ended		through
			September 30,		December 15,
			2010		2010							Pro-Forma
			Calypso		Seaglass							Adjusted
			Financial		Holding		Combined		Pro Forma			Combined
			Services, Inc.		Corp.		Totals		Adjustments		REF	Totals
ADVERTISING REVENUE			$	2,597,496	$	-	$	2,597,496	$	-		$	2,597,496
COST OF SALES				1,712,387		-		1,712,387		-			1,712,387

GROSS PROFIT				885,109		-		885,109		-			885,109

OPERATING EXPENSES

	General and administrative			747,501		962		748,463		-			748,463
	Depreciation expense			19,283		-		19,283		-			19,283
	Impairment of intangible assets			-		-		-		2,624,000	[2]		2,624,000

		Total Costs and Expenses		766,784		962		767,746		2,624,000			3,391,746

		OPERATING INCOME (LOSS)		118,325		(962)		117,363		(2,624,000)			(2,506,637)

OTHER INCOME (EXPENSE)

	Interest income			979		-		979		-			979
	Interest expense			(212)		-		(212)		-			(212)

		Total Other Income (Expense)		767		-		767		-			767

INCOME (LOSS) BEFORE INCOME TAXES				119,092		(962)		118,130		(2,624,000)			(2,505,870)
INCOME TAX EXPENSE (BENEFIT)				10,492		-		10,492		(10,492)	[5]		-

		NET INCOME (LOSS)	$	119,092	$	(962)	$	118,130	$	(2,624,000)		$	(2,505,870)


		Earnings (Loss) Per Share - Basic	$	0.02							[6]	$	(0.23)

		Earnings (Loss) Per Share - Diluted	$	0.02							[6]	$	(0.23)

		Weighted Average Number of
		Shares Outstanding		5,000,000							[6]		10,900,000

COLORADO RARE EARTHS, INC.

Consolidated Journal Entries






[1]	Mineral Properties	326,000
	Goodwill	2,624,000
	Common Stock		59
	Additional Paid-in Capital		2,949,941	Record the acquisition of Seaglass Holdings, Inc.

[2]	Impairment of Goodwill	2,624,000
	Goodwill		2,624,000	Record impariment of goodwill associated with the acquisition of Seaglass Holdings, Inc.


[3]	Common Stock	5,900
	Additional Paid-in Capital	12,415
	Mineral Properties		18,315	Eliminate capital accounts of Seaglass Holdings, Inc.


[4]	Additional Paid-in Capital	962
	Retained Earnings		962	Eliminate retained earnings of Seaglass Holdings, Inc.

[5]	Reflects the adjustment of the tax provision to an effective rate of 0%.

[6]	Reflects the basic and diluted weighted average shares of stock outstanding for the 5,900,000 shares issued to Seaglass.

COLORADO RARE EARTHS, INC.

Notes to Unaudited Pro Forma Consolidated Financial Statements

On December 15, 2010, Seaglass Holding Corporation (“Seaglass”) merged with Calypso Media Services Group, Inc. (“Calypso”) wherein Calypso purchase all of the issued and outstanding shares of Seaglass in exchange for 5,900,000 unregistered shares of Calypso’s authorized but previously unissued common stock on a one share for one share basis. The acquisition was structured as a triangular merger whereby Seaglass merged with Calypso Merger, Inc., a newly formed, wholly-owned subsidiary of Calypso created solely for the purpose of facilitating the acquisition. Seaglass becomes the surviving corporate entity as a wholly-owned subsidiary of Calypso and Calypso Merger, Inc. was dissolved. In connection with the acquisition, Calypso changed its corporate name to Colorado Rare Earths, Inc.

The unaudited pro forma consolidated balance sheets and statements of operations of Calypso and Seaglass are presented here as of September 30, 2010. The Company has not included pro forma, consolidated balance sheets or statements of operations as of December 31, 2009 due to the lack of activity prior to 2010 of Seaglass. Seaglass was not incorporated until December 10, 2010.

[1] Reflects the issuance of 5,900,000 shares of Calypso common stock to shareholders of Seaglass in exchange for all issued and outstanding shares of Seaglass. The acquisition was valued at $2,950,000 based on the market price of the shares on the date of issuance. The fair market value of the mineral claims was determined to be $326,000. The balance of the purchase price was allocated to Goodwill.

[2] Reflects the impairment of goodwill associated with the acquisition of Seaglass.

[3] Reflects the elimination of capital account balances of Seaglass in conjunction with the consolidation of the entities.

[4] Reflects the elimination of retained earnings of Seaglass in conjunction with the consolidation of the entities.

[5] Reflects the adjustment of the tax provision to an effective rate of 0%.

[6] Reflects the basic and diluted weighted average shares of stock outstanding for the 5,900,000 shares issued to Seaglass.

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