Attached files
| file | filename |
|---|---|
| 8-K/A - AMENDMENT TO CURRENT REPORT - ForceField Energy Inc. | fnrg_8ka.htm |
| EX-99.1 - AUDITED FINANCIAL STATEMENTS - ForceField Energy Inc. | fnrg_ex991.htm |
| EX-99.2 - UNAUDITED FINANCIAL STATEMENTS - ForceField Energy Inc. | fnrg_ex992.htm |
Exhibit 99.3
FORCEFIELD ENERGY INC. AND 17TH STREET ALD MANAGEMENT CORP.
Unaudited Pro Forma Consolidated Balance Sheets
March 31, 2014
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ForceField
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17th Street ALD
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Energy
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Management
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Adjustment(s)
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Consolidated
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ASSETS
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Current assets:
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Cash and cash equivalents
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$ | 2,451,146 | $ | 425,746 | $ | (2,450,000 | ) (a) | $ | 426,892 | |||||||
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Accounts receivable, net
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397,446 | 2,307,667 | (1,234,088 | ) (b) | 1,471,025 | |||||||||||
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Inventory, net
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92,644 | 269,480 | - | 362,124 | ||||||||||||
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Deferred tax assets, net
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- | 91,654 | - | 91,654 | ||||||||||||
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Prepaid expenses and other current assets
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357,569 | 119,923 | (50,000 | ) (a) | 427,492 | |||||||||||
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Total current assets
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3,298,805 | 3,214,470 | (3,734,088 | ) | 2,779,187 | |||||||||||
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Accounts receivable, noncurrent
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- | 1,230 | - | 1,230 | ||||||||||||
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Fixed assets
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21,824 | 10,788 | - | 32,612 | ||||||||||||
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Goodwill
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229,850 | - | 4,861,714 | (a)(c)(e) | 5,091,564 | |||||||||||
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Intangible assets, net
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1,944,508 | - | - | 1,944,508 | ||||||||||||
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Deferred tax assets, net -- noncurrent
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- | 766,137 | - | 766,137 | ||||||||||||
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Other assets
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103,769 | - | - | 103,769 | ||||||||||||
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Total assets
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$ | 5,598,756 | $ | 3,992,625 | $ | 1,127,626 | $ | 10,719,007 | ||||||||
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LIABILITIES AND EQUITY
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Current liabilities:
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Accounts payable
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$ | 404,308 | $ | 400,347 | $ | - | $ | 804,655 | ||||||||
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Accrued liabilities
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428,407 | 213,011 | - | 641,418 | ||||||||||||
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Contingent additional purchase consideration
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- | - | 333,334 | (c) | 333,334 | |||||||||||
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Convertible debentures, net -- current
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100,000 | - | - | 100,000 | ||||||||||||
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Senior, secured promissory notes
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- | - | 1,000,000 | (a) | 1,000,000 | |||||||||||
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Income taxes payable
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29,878 | 6,893 | - | 36,771 | ||||||||||||
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Deferred tax liabilities, net
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- | - | - | - | ||||||||||||
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Total current liabilities
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962,593 | 620,251 | 1,333,334 | 2,916,178 | ||||||||||||
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Contingent additional purchase consideration -- noncurrent
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- | - | 1,666,666 | (c) | 1,666,666 | |||||||||||
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Convertible debentures, net of loan discounts
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1,960,542 | - | - | 1,960,542 | ||||||||||||
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Mandatory redeemable preferred stock
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- | 1,234,088 | (1,234,088 | ) (a) | - | |||||||||||
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Deferred tax liabilities, net -- noncurrent
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418,404 | - | - | 418,404 | ||||||||||||
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Other noncurrent liabilities
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45,355 | - | - | 45,355 | ||||||||||||
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Total liabilities
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3,386,894 | 1,854,339 | 1,765,912 | 7,007,145 | ||||||||||||
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Commitments and contingencies
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- | - | - | - | ||||||||||||
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Equity:
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ForceField Energy Inc. stockholders' equity:
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Preferred stock
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- | - | - | - | ||||||||||||
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Common stock
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17,059 | 1,252 | (962 | ) (a)(d) | 17,349 | |||||||||||
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Common stock held in treasury, at cost
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(1,166,071 | ) | - | - | (1,166,071 | ) | ||||||||||
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Additional paid-in capital
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16,922,918 | 791,837 | 707,873 | (a)(d) | 18,422,628 | |||||||||||
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Accumualted deficit
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(13,693,717 | ) | 1,345,197 | (1,345,197 | ) (d) | (13,693,717 | ) | |||||||||
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Accumulated other comprehensive income
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20,107 | - | - | 20,107 | ||||||||||||
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Total ForceField Energy Inc. stockholders' equity
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2,100,296 | 2,138,286 | (638,286 | ) | 3,600,296 | |||||||||||
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Noncontrolling interests
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111,566 | - | - | 111,566 | ||||||||||||
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Total equity
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2,211,862 | 2,138,286 | (638,286 | ) | 3,711,862 | |||||||||||
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Total liabilities and equity
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$ | 5,598,756 | $ | 3,992,625 | $ | 1,127,626 | $ | 10,719,007 | ||||||||
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(a) To record the purchase of 17th Street ALD Management Corp. ("ALD"). As consideration, ForceField Energy Inc. ("Company") agreed to (i) pay $2,500,000 in cash; (ii) issue 289,529 unregistered shares of the Company's common stock (at a per share price of approximately $5.18); and (iii) issue an aggregate of $1,000,000 in 5% senior, secured promissory notes delivered to the former shareholders of ALD.
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(b) To record the effect of the a payment made on amounts due to the former shareholders of ALD that are fully collateralized by the accounts receivable balances of ALD, as defined in the Stock Purchase Agreement dated April 25, 2014.
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(c) To record a liability for the full effect of contingent additional purchase consideration, as defined in the Stock Purchase Agreement dated April 25, 2014.
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(d) To adjust the pre-acquisition equity of 17th Street ALD Management Corp.
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(e) The determination of goodwill is preliminary and subject to change in accordance with FASB ASC Topic 850, Business Combinations upon completion of an independent valuation study. Separately identifiable intangible assets may be determined to exist that may require amortization expense to be recognized in future periods.
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1
FORCEFIELD ENERGY INC. AND 17TH STREET ALD MANAGEMENT CORP.
Unaudited Pro Forma Consolidated Statements of Operations and Comprehensive Loss
For the Three Months Ended March 31, 2014
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ForceField
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17th Street ALD
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Energy
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Management
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Adjustment(s)
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Consolidated
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Sales
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$ | 183,565 | $ | 1,300,775 | $ | - | $ | 1,484,340 | ||||||||
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Cost of goods sold
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185,546 | 875,636 | - | 1,061,182 | ||||||||||||
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Gross margin
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(1,981 | ) | 425,139 | - | 423,158 | |||||||||||
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Operating expenses:
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Selling and marketing
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34,588 | 154,492 | - | 189,080 | ||||||||||||
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General and administrative
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723,037 | 302,969 | - | 1,026,006 | ||||||||||||
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Professional fees
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165,281 | 50,245 | - | 215,526 | ||||||||||||
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Gain (loss) from divestment of business
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30,001 | - | - | 30,001 | ||||||||||||
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Total operating expenses
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952,907 | 507,706 | - | 1,460,613 | ||||||||||||
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Income (loss) from continuing operations before other income (expense) and income taxes
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(954,888 | ) | (82,567 | ) | - | (1,037,455 | ) | |||||||||
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Other income (expense)
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Interest expense, net
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(82,882 | ) | 5,054 | (12,500 | ) (a) | (90,328 | ) | |||||||||
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Total other income (expense)
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(82,882 | ) | 5,054 | (12,500 | ) | (90,328 | ) | |||||||||
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Income (loss) from continuing operations before income taxes
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(1,037,770 | ) | (77,513 | ) | (12,500 | ) | (1,127,783 | ) | ||||||||
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Provision for income taxes (benefit)
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28,722 | 1,775 | - | 30,497 | ||||||||||||
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Net income (loss) from continuing operations
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(1,066,492 | ) | (79,288 | ) | (12,500 | ) | (1,158,280 | ) | ||||||||
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Discontinued operations, net of income taxes
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40,631 | - | - | 40,631 | ||||||||||||
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Net income (loss)
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(1,025,861 | ) | (79,288 | ) | (12,500 | ) | (1,117,649 | ) | ||||||||
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Less: Accretion of preferred stock
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- | 24,197 | - | 24,197 | ||||||||||||
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Less: Net income (loss) attributable to noncontrolling interests
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(15,278 | ) | - | - | (15,278 | ) | ||||||||||
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Net income (loss) attributable to ForceField Energy Inc. stockholders
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$ | (1,010,583 | ) | $ | (103,485 | ) | $ | (12,500 | ) | $ | (1,126,568 | ) | ||||
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Amounts attributable to ForceField Energy Inc. stockholders:
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Continuing operations, net of income taxes
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(1,051,214 | ) | (103,485 | ) | (12,500 | ) | (1,167,199 | ) | ||||||||
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Discontinued operations, net of income taxes
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40,631 | - | - | 40,631 | ||||||||||||
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Net income (loss) attributable to ForceField Energy Inc. stockholders
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(1,010,583 | ) | (103,483 | ) | (12,500 | ) | (1,126,563 | ) | ||||||||
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Basic and diluted earnings (loss) per common share attributable to ForceField Energy Inc. stockholders:
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Continuing operations
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$ | (0.06 | ) | $ | (0.07 | ) | ||||||||||
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Discontinued operations
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$ | 0.00 | $ | 0.00 | ||||||||||||
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Net income (loss) attributable to ForceField Energy Inc. stockholders
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$ | (0.06 | ) | $ | (0.07 | ) | ||||||||||
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Weighted-average number of common shares outstanding:
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Basic and diluted
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16,396,614 | 289,529 | 16,686,143 | |||||||||||||
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Comprehensive loss:
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Net income (loss)
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$ | (1,025,861 | ) | $ | (79,288 | ) | $ | (12,500 | ) | $ | (1,117,649 | ) | ||||
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Foreign curreny translation adjustment
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12,200 | - | - | 12,200 | ||||||||||||
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Comprehensive income (loss)
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(1,013,661 | ) | (79,288 | ) | (12,500 | ) | (1,105,449 | ) | ||||||||
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Comprehensive income (loss) attributable to noncontrolling interests
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(15,278 | ) | - | - | (15,278 | ) | ||||||||||
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Comprehensive income (loss) attributable to ForceField Energy Inc. stockholders
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$ | (998,383 | ) | $ | (79,288 | ) | $ | (12,500 | ) | $ | (1,090,171 | ) | ||||
(a) To record interest expense related to the aggregate $1,000,000 in senior, secured promissory notes issued to the former shareholders of 17th Steet ALD Management Corp.
2
FORCEFIELD ENERGY INC. AND 17TH STREET ALD MANAGEMENT CORP.
Unaudited Pro Forma Consolidated Statements of Operations and Comprehensive Loss
For the Year Ended December 31, 2013
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ForceField
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17th Street ALD
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Energy
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Management
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Adjustment(s)
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Consolidated
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Sales
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$ | 343,636 | $ | 7,123,458 | $ | - | $ | 7,467,094 | ||||||||
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Cost of goods sold
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273,010 | 4,197,958 | - | 4,470,968 | ||||||||||||
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Gross margin
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70,626 | 2,925,500 | - | 2,996,126 | ||||||||||||
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Operating expenses:
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Selling and marketing
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118,794 | 735,071 | - | 853,865 | ||||||||||||
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General and administrative
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1,856,309 | 1,600,817 | - | 3,457,126 | ||||||||||||
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Professional fees
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709,499 | 26,365 | - | 735,864 | ||||||||||||
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Goodwill impairment
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1,342,834 | - | - | 1,342,834 | ||||||||||||
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Total operating expenses
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4,027,436 | 2,362,253 | - | 6,389,689 | ||||||||||||
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Income (loss) from continuing operations before other income (expense) and income taxes
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(3,956,810 | ) | 563,247 | - | (3,393,563 | ) | ||||||||||
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Other income (expense)
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Gain (loss) from forgiveness of debt
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88,647 | - | - | 88,647 | ||||||||||||
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Interest expense, net
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(47,926 | ) | 10,893 | (50,000 | ) (a) | (87,033 | ) | |||||||||
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Total other income (expense)
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40,721 | 10,893 | (50,000 | ) | 1,614 | |||||||||||
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Income (loss) from continuing operations before income taxes
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(3,916,089 | ) | 574,140 | (50,000 | ) | (3,391,949 | ) | |||||||||
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Provision for income taxes (benefit)
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(197,532 | ) | 237,134 | - | 39,602 | |||||||||||
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Net income (loss) from continuing operations
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(3,718,557 | ) | 337,006 | (50,000 | ) | (3,431,551 | ) | |||||||||
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Discontinued operations, net of income taxes
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(4,309,880 | ) | - | - | (4,309,880 | ) | ||||||||||
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Net income (loss)
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(8,028,437 | ) | 337,006 | (50,000 | ) | (7,741,431 | ) | |||||||||
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Less: Accretion of preferred stock
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- | 139,436 | - | 139,436 | ||||||||||||
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Less: Net income (loss) attributable to noncontrolling interests
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(2,267,501 | ) | - | - | (2,267,501 | ) | ||||||||||
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Net income (loss) attributable to ForceField Energy Inc. stockholders
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$ | (5,760,936 | ) | $ | 197,570 | $ | (50,000 | ) | $ | (5,613,366 | ) | |||||
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Amounts attributable to ForceField Energy Inc. stockholders:
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Continuing operations, net of income taxes
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(1,451,056 | ) | 197,570 | (50,000 | ) | (1,303,486 | ) | |||||||||
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Discontinued operations, net of income taxes
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(4,309,880 | ) | - | - | (4,309,880 | ) | ||||||||||
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Net income (loss) attributable to ForceField Energy Inc. stockholders
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(5,760,936 | ) | 197,570 | (50,000 | ) | (5,613,366 | ) | |||||||||
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Basic and diluted earnings (loss) per common share attributable to ForceField Energy Inc. stockholders:
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||||||||||||||||
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Continuing operations
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$ | (0.09 | ) | $ | (0.08 | ) | ||||||||||
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Discontinued operations
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$ | (0.26 | ) | $ | (0.26 | ) | ||||||||||
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Net income (loss) attributable to ForceField Energy Inc. stockholders
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$ | (0.35 | ) | $ | (0.34 | ) | ||||||||||
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Weighted-average number of common shares outstanding:
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Basic and diluted
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16,291,566 | 289,529 | 16,581,095 | |||||||||||||
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Comprehensive loss:
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Net income (loss)
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$ | (8,028,437 | ) | $ | 337,006 | $ | (50,000 | ) | $ | (7,741,431 | ) | |||||
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Foreign curreny translation adjustment
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99,237 | - | - | 99,237 | ||||||||||||
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Comprehensive income (loss)
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(7,929,200 | ) | 337,006 | (50,000 | ) | (7,642,194 | ) | |||||||||
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Comprehensive income (loss) attributable to noncontrolling interests
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(2,267,501 | ) | - | - | (2,267,501 | ) | ||||||||||
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Comprehensive income (loss) attributable to ForceField Energy Inc. stockholders
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$ | (5,661,699 | ) | $ | 337,006 | $ | (50,000 | ) | $ | (5,374,693 | ) | |||||
(a) To record interest expense related to the aggregate $1,000,000 in senior, secured promissory notes issued to the former shareholders of 17th Steet ALD Management Corp.
3