(A)

(B)

(C)

Streamline

Meta Health

Meta Health

(A) + (B) + (C)

Health Solutions, Inc.

Technology, Inc.

Technology, Inc.

Pro Forma

As Reported

As Reported

Pro Forma

Combined

Jan 31, 2013

Aug 16, 2012

Adjustments

(D)

Revenue

$

23,766,803

$

5,704,122

$

29,470,925

Operating expenses:

Cost of sales

11,592,952

1,425,111

13,018,063

(e)

883,968

(d)

(796,735

)

Selling, general and administrative

10,060,469

2,874,016

13,021,717

Product research and development

2,948,313

1,623,051

4,571,364

Total operating expenses

24,601,734

5,922,177

87,233

30,611,143

Operating profit (loss)

(834,931

)

(218,055

)

(87,233

)

(1,140,218

)

Interest income

—

(f)

(554,451

)

(g)

(402,975

)

(c)

(166,131

)

(b)

(992,302

)

Interest Expense

(1,957,010

)

—

(a)

267,135

(6,805,018

)

Other Income (expense), net

(5,475,325

)

878,706

(4,596,619

)

Tax (provision) benefit

2,888,537

(285,984

)

(i)

(2,999,284

)

2,602,553

Net earnings (loss)

$

(5,378,729

)

$

374,668

$

(4,935,241

)

$

(9,939,302

)

Less: Deemed dividend of preferred shares

$

(176,048

)

(h)

$

(274,422

)

$

(450,470

)

Net earnings (loss) attributed to common shareholders

$

(5,554,777

)

$

374,668

$

(5,209,663

)

$

(10,389,772

)

Basic Loss per common share

$

(0.48

)

$

(0.88

)

Number of shares used in Basic per share computation

11,634,540

11,831,981

Diluted Loss per common share

$

(0.48

)

$

(0.88

)

Number of shares used in Diluted per share computation

11,634,540

11,831,981

Meta Health Technology, Inc. Pro Forma Condensed Combined Statement of Earnings Adjustments:

(a)

To remove historical interest expense on term loan re-financed as part of acquisition

YTD 8/16/12

$ 4,120,000 at 12% annually

$

(267,135

)

(b)

To record interest expense on the $5,000,000 senior term loan and the $9,000,000 subordinated term loan used to finance the Meta Health Technology acquisition and the commitment fee on the $5,000,000 re-financed revolving line of credit

YTD 8/16/12

$ 5,000,000 term loan at Libor plus 5.5%

$

154,802

$ 9,000,000 term loan at 10% plus 7% success fee

826,694

$ 5,000,000 Revolver with 0.04% commitment fee

10,806

Total Interest expense

$

992,302

(c)

To record amortization of deferred financing costs related to the debt refinancing and PIPE transaction:

YTD 8/16/12

Total deferred financing costs  $ 1,795,374 24 month amortization

Amortization expense

$

166,131

(d)

To remove historical transaction related expenses

YTD 8/16/12

Transaction expense

$

(796,735

)

(e)

To record the Meta Health identifiable intangible assets as follows:

Amount

Useful life

Supplier agreements

$

1,582,000

5 years

Customer relationships

4,464,000

10 years

Non-compete agreements

720,000

5 years

Internally developed software

3,646,000

5 years

Trade name

1,588,000

N/A

Goodwill

3,241,447

N/A

Total

$

15,241,447

The amortization of the customer relationships intangible asset was calculated using the estimated economic benefit of the cash flow of that intangible asset over its estimated useful life, which results in an accelerated amortization rather than amortization on a straight line basis.

Amortization expense over the next five years is expected to be as follows:

Year ended January 31,

2013

537,611

2014

520,914

2015

518,103

2016

478,314

2017

441,518

YTD 8/16/12

Amortization expense

$

883,968

(f)

To record the amortization of the convertible subordinated note discount over the period from the issue date to the stated redemption date. The amortization expense was calculated using the effective interest method.

YTD 8/16/12

Amortization of debt discount

$

(554,451

)

(g)

To record interest on convertible subordinated note issued as part of equity transaction

Principal value of  12%convertible subordinated note

Interest is payable 30 days in arrears, with 6% of interest due in cash, and 6% (or in half) compounded over the life of the note. Interest was calculated using the effective interest method.

YTD 8/16/12

Interest expense

$

(402,975

)

(h)

To record deemed dividends on preferred shares

The deemed dividends is calculated based on the Preferred share discount and the beneficial conversion feature less the unamortized transaction costs.

YTD 8/16/12

Dividends

$

(274,422

)

(i)

To remove the tax benefit resulting from the acquisition due to net operating loss carryforwards.

YTD 8/16/12

$

(2,999,284

)