Sibling Group Holdings, Inc. - FORM 8-K/A - EX-99.3 - UNAUDITED FINANCIAL STATEMENTS

Attached files

file	filename
8-K/A - CURRENT REPORT - Sibling Group Holdings, Inc.	sibe_8k.htm
EX-99.1 - 2013 AUDITED FINANCIAL STATEMENTS - Sibling Group Holdings, Inc.	sibe_ex99z1.htm
EX-99.1 - 2012 AUDITED FINANCIAL STATEMENTS - Sibling Group Holdings, Inc.	sibe_ex99z2.htm

EXHIBIT 99.3

Sibling Group Holdings, Inc.

Introduction to the Pro Forma Condensed Combined Financial Statements (Unaudited)

On March 30, 2014, Sibling Group Holdings, Inc., (the "Company", "we", "us", "our"), through its wholly owned subsidiary, BLSCH Acquisition, LLC signed a Closing Terms Addendum (the "Closing Addendum") to the Asset Purchase Agreement between the BLSCH Acquisition, LLC and blendedschools.net, Inc., a non-profit entity ("Blended Schools") dated November 25, 2013. Under the terms of the Closing Addendum, we closed on the purchase of assets of Blended Schools effective as of May 30, 2014. Under the terms of the Closing Addendum, we agreed to pay the $550,000 purchase price for the assets by assuming $446,187 of Blended Schools' debt, agreeing to pay up to an additional $50,000 in debt or payment to Blended Schools if the amount of its debts did not exceed $446,187 and by payment of $53,813 in cash which was made on June 6, 2014. Included in the debts we assumed is a $100,372 bank line of credit that we are obligated to pay off if we are unable to obtain the lender's consent to an assignment by June 15, 2014. In addition, we agreed to pay certain other debts of Blended Schools as provided for in the Asset Purchase Agreement.

The final allocation of the purchase price will be determined after the completion of the acquisition and will be based upon actual net tangible and intangible assets acquired as well as liabilities assumed. Final purchase accounting adjustments may differ materially from the pro forma adjustments presented here.

The following presents unaudited pro forma condensed combined financial statements as if the acquisition described above had been completed at the beginning of each of the periods presented for statement of operations purposes. In addition, the unaudited pro forma condensed combined statement of operations is based on assumptions and includes adjustments as explained in the notes thereto. As a result, the summary unaudited pro forma condensed combined financial statements do not necessarily reflect the results of operations that actually would have resulted had the merger been consummated as of the dates referred to above.

These unaudited pro forma condensed combined financial statements are based upon the respective historical financial statements of the Company and blendedschools.net, Inc. and should be read in conjunction with the historical financial statements of the Company and blendedschools.net, Inc. and the related notes.

SIBLING GROUP HOLDINGS, INC.

Pro Forma Condensed Combined Balance Sheets

(Unaudited)


	SIBE			BSN						Combined
	March 31,			March 31,						March 31,
	2014			2014		Adjustments				2014
	a			b

ASSETS

Current assets:
Cash	$	1,169		$	140,732	$	(140,732	)	c	$	1,169
Accounts receivable		0			38,874						38,874
Prepaid expenses		7,969			50,106						58,075
Total current assets		9,138			229,712		(140,732	)			98,118

Equipment		0			341						341
Goodwill, acquisitions		122,000			0						122,000
Intangible assets		0			1,024,469		(2,378	)	d		1,022,091

Total assets	$	131,138		$	1,254,522	$	(143,110	)		$	1,242,550


LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities:
Accounts payable	$	512,311		$	141,100					$	653,411
Accrued liabilities		66,167			300,719		(41,819	)	c		325,067
Deferred revenue		0			611,412						611,412
Short-term notes payable		32,500			100,000						132,500
Total current liabilities		610,978			1,153,231		(41,819	)			1,722,390

Net assets - unrestricted		0			101,291		(101,291	)	c		0

Stockholders' deficit

Preferred stock, no par value		0			0						0
Common stock, $0.0001 par value		3,911			0						3,911
Additional paid-in capital		7,736,222			0						7,736,222
Accumulated deficit		(8,219,973	)		0						(8,219,973	)
Total stockholders' deficit		(479,840	)		101,291		(101,291	)			(479,840	)

Total liabilities and stockholders' deficit	$	131,138		$	1,254,522	$	(143,110	)		$	1,242,550

See notes to unaudited Pro Forma condensed combined financial statements

SIBLING GROUP HOLDINGS, INC.

Pro Forma Condensed Combined Statement of Operations

(Unaudited)


	SIBE			BSN							Combined
	Nine months ended			Nine months ended							Nine months ended
	March 31, 2014			March 31, 2014			Adjustments				March 31, 2014
	e			f
Revenues	$	0		$	1,668,508		$				$	1,668,508

Operating expenses
Program		0			1,993,220			(8,997	)	g		1,984,223
General and administrative		145,075			243,999							389,074
Professional fees		1,234,966			0							1,234,966
Total operating expenses		1,380,041			2,237,219			(8,997	)			3,608,263

(Loss) from operations		(1,380,041	)		(568,711	)		8,997				(1,939,755	)

Other income (expense)
Other income		0			0							0
Interest income (expense)		(15,848	)		0							(15,848	)
Total other income (expense)		(15,848	)		0			0				(15,848	)

Net (loss)	$	(1,395,889	)	$	(568,711	)	$	8,997			$	(1,955,603	)

Net loss per share	$	(0.05	)								$	(0.07	)

Weighted average shares outstanding, basic and diluted		27,894,699										27,894,699

See notes to unaudited Pro Forma condensed combined financial statements

SIBLING GROUP HOLDINGS, INC.

Pro Forma Condensed Combined Statement of Operations

(Unaudited)


	SIBE			BSN							Combined
	Year ended			Year ended							Year ended
	June 30, 2013			June 30, 2013			Adjustments				June 30, 2013
	h			i
Revenue	$	0		$	2,639,582		$				$	2,639,582

Operating
expenses
Program expenses		0			2,505,834			(9,157	)	j		2,496,677
General and administrative		1,270,306			260,352							1,530,658
Professional fees		462,341			0							462,341
Total operating expenses		1,732,647			2,766,186			(9,157	)			4,489,676

Loss from operations		(1,732,647	)		(126,604	)		9,157				(1,850,094	)

Other income (expense)
Other income		1,197			0							1,197
Interest income (expense)		(12,038	)		0							(12,038	)
Total other income (expense)		(10,841	)		0			0				(10,841	)

Net loss	$	(1,743,488	)	$	(126,604	)	$	9,157			$	(1,860,935	)


Net loss per share	$	(0.12	)								$	(0.13	)

Weighted average shares outstanding, basic and diluted		14,682,664										14,682,664

See notes to unaudited Pro Forma condensed combined financial statements

Sibling Group Holdings, Inc.

Notes to the Pro Forma Condensed Combined Financial Statements

(Unaudited)

Note 1 – Asset Purchase Agreement

After the Asset Purchase Agreement described above is effectuated, the Company will own and operate the business formerly operated under the entity blendedschools.net, Inc.

The unaudited pro forma condensed combined balance sheets of the Company and blendedschools.net, Inc. as of March 31, 2014 as if the acquisition of such assets occurred on that date. The unaudited pro forma condensed combined statements of operations are based upon the condensed combined statements of operations of the Company and blendedschools.net, Inc. for the nine months ended March 31, 2014 and for the year ended June 30, 2013, as if the aforementioned transaction had occurred at the beginning of the respective periods.

Note 2 – Pro Forma Adjustments


a.	Derived from the unaudited balance sheet of the Company as of March 31, 2014 from the Form 10Q filed on May 15, 2014.
b.	Derived from the unaudited balance sheet of blendedschools.net, Inc as of March 31, 2014.
c.	Elimination of assets and liabilities not acquired.
d.	Restatement of the fair value of the intangibles acquired. Such intangible assets are being amortized over three years.
e.	Derived from the unaudited statement of operations of the Company for the nine months ended March 31, 2014.
f.	Derived from the unaudited statement of operations of blendedschools.net, Inc for the nine months ended March 31, 2014.
g.	Restatement of the amortization of intangibles, utilizing a three year amortization rate.
h.	Derived from the unaudited statement of operations of the Company for the year ended June 30, 2013.
i.	Derived from the audited statement of operations of blendedschools.net, Inc for the year ended June 30, 2013.
j.	Restatement of the amortization of the intangibles, utilizing a three year amortization rate.

Sibling Group Holdings, Inc. - FORM 8-K/A - EX-99.3 - UNAUDITED FINANCIAL STATEMENTS - August 13, 2014

Attached files

Sibling Group Holdings, Inc. Reports