Exhibit 99.2

 

RESTORERS ACQUISITON, INC.

 

FINANCIAL STATEMENTS

 

YEARS ENDED 

DECEMBER 31, 2014 and 2013

 

  

RESTORERS ACQUISITION, INC.

 

FINANCIAL STATEMENTS

 

YEARS ENDED DECEMBER 31, 2014 AND 2013

 

CONTENTS 

 

		Page
Independent Auditor’s Report		1
Balance Sheets		2
Statements of Operations		3
Statements of Stockholders’ Equity		4
Statements of Cash Flows		5
Notes to Financial Statements		6
Supplementary Information		14
Independent Auditor’s Report on Supplementary Information		15
Capitalization Table		16

 

10990 Wilshire Boulevard  16th Floor  Los Angeles, CA 90024

310-873-1600 T  310-873-6600 F  www.greenhassonjanks.com

  

INDEPENDENT AUDITOR’S REPORT

 

To the Board of Directors of 

Restorers Acquisition, Inc.

 

Report on the Financial Statements 

We have audited the accompanying financial statements of Restorers Acquisition, Inc. (the company), which comprise the balance sheets as of December 31, 2014 and 2013, and the related statements of operations, stockholders’ equity, and cash flows for the years then ended and the related notes to the financial statements.

 

Management’s Responsibility for the Financial Statements 

Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

 

Auditor’s Responsibility 

Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement.

 

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting principles used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

 

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

 

Opinion 

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Restorers Acquisition, Inc. as of December 31, 2014 and 2013, and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United Statements of America.

  

 

March 27, 2015 

Los Angeles, California

 

An independent member of HLB International, a worldwide network of accounting firms and business advisors.

 

  

RESTORERS ACQUISITION, INC.   BALANCE SHEETS
		December 31
		2014				2013
ASSETS
CURRENT ASSETS:
Accounts Receivable – Trade (Net of Allowance for Doubtful Accounts of $22,000 in 2013)		$	98,970			$	159,219
Inventory			2,128,096				2,174,093
Prepaid Expenses and Other Current Assets			306,831				131,888
Deferred Income Tax Assets			156,000				137,000
TOTAL CURRENT ASSETS			2,689,897				2,602,200
PROPERTY AND EQUIPMENT (Net)			35,935				62,211
OTHER ASSETS:
Debt Issuance Costs (Net)			27,255				55,469
TOTAL ASSETS		$	2,753,087			$	2,719,880
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES:
Book Overdraft		$	223,546			$	198,279
Accounts Payable			753,620				464,660
Line of Credit			340,000				—
Accrued Expenses and Other Liabilities			68,801				169,562
Related Party Payables			26,291				19,733
TOTAL CURRENT LIABILITIES			1,412,258				852,234
OTHER LIABILITIES:
Deferred Income Tax Liabilities			16,000				23,000
Line of Credit			—				465,615
TOTAL OTHER LIABILITIES			16,000				488,615
TOTAL LIABILITIES			1,428,258				1,340,849
COMMITMENTS & CONTINGENCIES
STOCKHOLDERS’ EQUITY
Common Stock - $0.01 Par Value, 5,000 Shares Authorized; 573 Shares Issued and Outstanding at December 31, 2014 and 2013.			6				6
Additional Paid-In Capital			588,709				588,709
Retained Earnings			736,114				790,316
TOTAL STOCKHOLDERS’ EQUITY			1,324,829				1,379,031
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY		$	2,753,087			$	2,719,880

 

  The Accompanying Notes are an Integral Part of These Financial Statements

 

 

RESTORERS ACQUISITION, INC.   STATEMENTS OF OPERATIONS
		Years Ended December 31
		2014								2013
		Amount				% of   Net Sales				Amount				% of   Net Sales
NET SALES		$	11,314,990				100.0			$	12,070,151				100.0
COST OF SALES			6,287,162				55.6				6,493,449				53.8
GROSS PROFIT			5,027,828				44.4				5,576,702				46.2
OPERATING EXPENSES:
Selling			2,789,103				24.6				2,738,988				22.7
General and Administrative			1,968,871				17.4				1,883,503				15.6
TOTAL OPERATING EXPENSES			4,757,974				42.0				4,622,491				38.3
INCOME FROM OPERATIONS			269,854				2.4				954,211				7.9
OTHER EXPENSES:
Interest Expense			54,608				0.5				108,569				0.9
Other Expenses			295,448				2.6				246,907				2.0
TOTAL OTHER EXPENSES			350,056				3.1				355,476				2.9
INCOME (LOSS) BEFORE PROVISION FOR (BENEFIT FROM) INCOME TAXES			(80,202	)			(0.7	)			598,735				5.0
Provision for (Benefit from) Income Taxes			(26,000	)			(0.2	)			189,000				1.6
NET INCOME (LOSS)		$	(54,202	)			(0.5	)		$	409,735				3.4

 

The Accompanying Notes are an Integral Part of These Financial Statements

 

RESTORERS ACQUISITION, INC.   STATEMENTS OF STOCKHOLDERS’ EQUITY  Years Ended December 31, 2014 and 2013
		Common Stock								Additional Paid-In Capital
		Number of Shares				Amount								Retained Earnings				Stockholders’ Equity
Balance at January 1, 2013			595			$	6			$	603,809			$	380,581			$	984,396
Purchase of Common Stock			(22	)			—				(15,100	)			—				(15,100	)
Net Income			—				—				—				409,735				409,735
BALANCE AT DECEMBER 31, 2013			573				6				588,709				790,316				1,379,031
Net Loss			—				—				—				(54,202	)			(54,202	)
BALANCE AT DECEMBER 31, 2014			573			$	6			$	588,709			$	736,114			$	1,324,829

The Accompanying Notes are an Integral Part of These Financial Statements

 

  

RESTORERS ACQUISITION, INC.   STATEMENTS OF CASH FLOWS
		Years Ended December 31
		2014				2013
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income (Loss)		$	(54,202	)		$	409,735
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided by Operating Activities:
Depreciation and Amortization			27,943				27,177
Amortization of Debt Issuance Costs			38,982				11,094
Reversal of Allowance for Doubtful Accounts			(22,000	)			—
Deferred Income Tax Benefit			(26,000	)			(68,000	)
(Increase) Decrease in:
Accounts Receivable – Trade			82,249				(65,548	)
Inventory			45,997				130,147
Prepaid Expenses and Other Current Assets			(176,610	)			135,965
Increase (Decrease) in:
Book Overdraft			25,267				198,279
Accounts Payable			288,960				(365,688	)
Accrued Expenses and Other Liabilities			(100,761	)			(61,793	)
Related Party Payables			6,558				(99,542	)
NET CASH PROVIDED BY OPERATING ACTIVITIES			136,383				251,826
CASH FLOWS USED IN INVESTING ACTIVITY:
Acquisition of Property and Equipment			—				(12,990	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Debt Issuance Costs			(10,768	)			(66,563	)
Net Proceeds from (Repayments on) Line of Credit			(125,615	)			465,615
Principal Payments on Long-Term Debt – Related Party			—				(1,187,437	)
Purchase of Common Stock			—				(15,100	)
NET CASH USED IN FINANCING ACTIVITIES			(136,383	)			(803,485	)
NET DECREASE IN CASH			—				(564,649	)
Cash – Beginning of Year			—				564,649
CASH – END OF YEAR		$	—			$	—
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash Paid During the Year for:
Interest		$	54,608			$	108,569
Income Taxes			131,000				132,000

 

The Accompanying Notes are an Integral Part of These Financial Statements

 

 

RESTORERS ACQUISITION, INC.

 

NOTES TO FINANCIAL STATEMENTS 

December 31, 2014 and 2013

 

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

(a)

NATURE OF OPERATIONS

 

Restorers Acquisition, Inc. (the company) was incorporated on October 5, 2010 under the laws of the State of Delaware and is a majority-owned subsidiary of Scrubs AC LLC. The company is primarily a retail seller of home improvement and restoration products. The company sells over the internet through the domain name of www.Vandykes.com and through direct mail catalogs. The company’s receiving, accounts receivable, warehousing and shipping functions are operated by an outside logistics company located in Missouri.

 

(b)

MANAGEMENT’S USE OF ESTIMATES

 

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to use certain estimates and assumptions. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses during the reporting period. Although management believes its estimates are appropriate, changes in assumptions utilized in preparing such estimates could cause these estimates to change sometime in the future.

 

(c)

CASH

 

The company maintains its cash in bank deposit accounts which, at times, may exceed federally-insured limits. The company has not experienced any losses in such accounts. The company believes it is not exposed to any significant credit risk regarding cash.

 

(d)

TRADE AND OTHER RECEIVABLES

 

Receivables are recorded when billed or accrued and represent claims against third parties that will be settled in cash. The carrying value of receivables, net of the allowance for doubtful accounts, represents their estimated net realizable value. The allowance for doubtful accounts is estimated based on historical collection trends, type of customer, the age of outstanding receivables and existing economic conditions. If events or changes in circumstances indicate that specific receivable balances may be impaired, further consideration is given to the collectability of those balances and the allowance is adjusted accordingly. Past due receivable balances are written-off when internal collection efforts have been unsuccessful in collecting the amount due.

 

(e)

INVENTORY

 

Inventory is valued at the lower of cost or market using the Weighted Average method of determining cost.

 

  

RESTORERS ACQUISITION INC.

 

NOTES TO FINANCIAL STATEMENTS 

December 31, 2014 and 2013

 

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

 

(f)

PROPERTY AND EQUIPMENT

 

Property and equipment are carried at cost, net of accumulated depreciation. Depreciation has been provided by using the straight-line method over the estimated useful lives of the assets as follows:

 

Computer Equipment	3 - 5 Years
Computer Software	3 Years

  

The cost of maintenance and repairs is charged to operations as incurred while renewals and betterments are capitalized.

 

(g)

DEBT ISSUANCE COSTS

 

Debt issuance costs are amortized by use of the straight-line method over the anticipated maturity of the related loans.

 

(h)

INTANGIBLE ASSETS

 

Intangibles with finite useful lives are carried at estimated fair value at the date of the business combination, net of accumulated amortization. These assets are assessed for impairment upon the occurrence of a triggering event. Intangible assets (net) of $17,985 and $19,652 are included in prepaid expenses and other current assets at December 31, 2014 and 2013, respectively. Amortization has been provided by using the straight-line method over the estimated useful lives of the assets as follows:

 

Trade Name

15 Years

 

(i)

ADVERTISING

 

The company expenses pay-per-click advertising costs as they are incurred. Catalog costs are capitalized and are recognized as an expense over the expected future benefit period. As of December 31, 2014 and 2013, catalog costs included in prepaid expenses and other assets amounted to $252,665 and $98,909, respectively. Total advertising costs for the years ended December 31, 2014 and 2013, amounted to $1,844,560 and $1,756,754, respectively.

 

(j)

SHIPPING AND HANDLING COSTS

 

The company includes shipping and handling fees billed to customers in net sales. Shipping and handling costs are expensed as incurred and included in cost of sales.

 

 

RESTORERS ACQUISITION INC.

 

NOTES TO FINANCIAL STATEMENTS 

December 31, 2014 and 2013

 

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

 

(k)

INCOME TAXES

 

Income taxes are provided on income reported in the financial statements and adjusted for transactions that do not enter the computation of income tax payable.

 

Deferred income taxes are recognized for the tax consequences of “temporary differences” by applying currently enacted statutory tax rates applicable to future years’ differences between the financial statement carrying amounts and the tax bases of existing assets and liabilities. The effect on deferred income taxes of a change in tax rates is recognized in the period that includes the enactment date.

 

A valuation allowance is provided against deferred income tax assets when their estimated realization is uncertain.

 

In accordance with the accounting pronouncement, Accounting for Uncertainty in Income Taxes, the company recognizes the effect of income tax positions only if those positions are more likely than not to be sustained. Recognized income tax positions are measured at the largest amount that has a greater than 50% likelihood of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs.

 

The company is subject to U.S. federal income tax and state income tax examinations by tax authorities for all fiscal years in operation including the period ended December 31, 2010, which represents the company’s first taxable year of operations.

 

(l)

STOCK-BASED COMPENSATION

 

The Company accounts for stock-based awards to employees using the fair value method using a Black-Scholes valuation model.

 

Determining the estimated fair value of share-based awards is subjective in nature and involves the use of significant estimates and assumptions, including the term of the share-based awards, risk-free interest rates over the vesting period, expected dividend rates, the price volatility of the company’s shares and forfeiture rates of the awards. The company bases its fair value estimates on assumptions it believes to be reasonable but that are inherently uncertain. Stock-based compensation expense for both the years ended December 31, 2014 and 2013 was not material to the financial statements and, thus, was not recorded.

 

(m)

SUBSEQUENT EVENTS

 

The company has evaluated events and transactions occurring subsequent to the balance sheet date of December 31, 2014, for items that should potentially be recognized or disclosed in these financial statements. The evaluation was conducted through March 27, 2015, the date these financial statements were available to be issued. No such material events or transactions were noted to have occurred.

 

 

RESTORERS ACQUISITION INC.

 

NOTES TO FINANCIAL STATEMENTS 

December 31, 2014 and 2013

 

NOTE 2 – PROPERTY AND EQUIPMENT

 

Property and equipment consist of the following:

		2014				2013
Computer Equipment		$	13,610			$	17,991
Computer Software			96,865				99,821
TOTAL			110,475				117,812
Less:  Accumulated Depreciation			(74,540	)			(55,601	)
PROPERTY AND EQUPIMENT (NET)		$	35,935			$	62,211

 

Depreciation expense charged to operations for the years ended December 31, 2014 and 2013 amounted to $26,276 and $25,510, respectively.

 

NOTE 3 – DEBT ISSUANCE COSTS

 

Debt issuance costs consist of the following:

		2014				2013
Debt Issuance Costs		$	77,331			$	66,563
Less:  Accumulated Amortization			(50,076	)			(11,094	)
DEBT ISSUANCE COSTS (NET)		$	27,255			$	55,469

  

During the years ended December 31, 2014 and 2013, the company incurred debt issuance costs totaling $10,768 and $66,563, respectively, in connection with obtaining the line of credit. Estimated amortization expense for the year ended December 31, 2015 is $27,255.

 

NOTE 4 – LINE OF CREDIT

 

During August 2013, the company obtained a revolving line of credit from a bank (the line) providing for maximum borrowings of $2,000,000. The line is collateralized by substantially all the assets of the company. Interest is payable monthly at LIBOR plus 3.50%. LIBOR was approximately 0.13% as of December 31, 2014. The amount outstanding under the line at December 31, 2014 and 2013 was $340,000 and $465,615, respectively. There was $1,660,000 available on the line as of December 31, 2014. The line matures in August 2015 and all unpaid principal is due on maturity. The line contains various covenants and restrictions including, but not limited to, the maintenance of certain equity and profitability ratios.

 

RESTORERS ACQUISITION INC.

 

NOTES TO FINANCIAL STATEMENTS 

December 31, 2014 and 2013

 

NOTE 5 – INCOME TAXES

 

The provision for (benefit from) income taxes for the years ended December 31 consists of the following:

 

		2014				2013
Current – Federal		$	—			$	250,000
Current – State			—				7,000
Deferred Income Tax Benefit			(26,000	)			(68,000	)
PROVISION FOR (BENEFIT FROM) INCOME TAXES		$	(26,000	)		$	189,000

  

Deferred income tax assets (liabilities) are comprised of the following at December 31:

 

		2014				2013
DEFERRED INCOME TAX ASSETS:
Allowance for Doubtful Accounts		$	—			$	9,000
Inventory Capitalization			86,000				61,000
Inventory Valuation Allowance			62,000				110,000
Net Operating Loss Carryforwards			106,000				—
TOTAL DEFERRED INCOME TAX ASSETS			254,000				180,000
DEFERRED INCOME TAX LIABILITIES:
Accumulated Depreciation and Amortization			(15,000	)			(24,000	)
Prepaid Expenses			(98,000	)			(42,000	)
State Taxes			(1,000	)			—
TOTAL DEFERRED INCOME TAX LIABILITIES			(114,000	)			(66,000	)
NET DEFERRED INCOME TAXES		$	140,000			$	114,000
DEFERRED INCOME TAX ASSETS (LIABILITIES):
Current		$	156,000			$	137,000
Non-Current			(16,000	)			(23,000	)
NET DEFERRED INCOME TAXES ASSETS		$	140,000			$	114,000

  

The difference between the provision for (benefit from) income taxes as a percentage of income before provision for (benefit from) income taxes and the federal statutory rate of 34% is due primarily to state income taxes.

  

At December 31, 2014, the company has net operating loss carryforwards available to be utilized for federal income tax purposes of approximately $311,000. These will begin to expire in the year 2034.

 

  

RESTORERS ACQUISITION INC.

 

NOTES TO FINANCIAL STATEMENTS 

December 31, 2014 and 2013

 

NOTE 6 – RELATED PARTY TRANSACTIONS

 

On October 16, 2010, the company entered into an agreement with Scrubs AC, Inc. (Scrubs), a company related to the majority stockholder by common ownership, to provide management services. This agreement, amended in May 2013, terminated on June 30, 2013. Scrubs provided the company with financial managerial, strategic, and operational advice in addition to assistance in connection with its day-to-day operations. The total expense incurred for these services for the years ended December 31, 2014 and 2013 totaled $91,917 and $250,886, respectively and is included in general and administrative expenses. As of December 31, 2014 and 2013, there was $2,652 and $19,414, respectively, due to Scrubs and is included in related-party payables. 

 

On June 1, 2013, the company entered into an agreement with J&P Park Acquisitions, Inc. (JPPA), a BCP II company related to the majority shareholder by some common ownership, to provide additional management services including finance, marketing, accounting, human resources, administration, information technology services and use of office space. During the years ended December 31, 2014 and 2013, the company was charged $868,562 and $647,044, respectively, for labor and operational support and $43,200 and $32,700, respectively, for the use of certain office space in JPPA's facility. As of December 31, 2014 and 2013, there was $23,639 and $319 due to JPPA and included in related party payables. The agreement with JPPA was amended on October 1, 2014 and is terminable upon mutual consent of both parties. 

 

Blackstreet Capital Management (BCM) (Blackstreet), a company related to the majority stockholder with some minority common ownership, provides management advice, business consulting and general oversight of the company’s operations throughout the year under an agreement executed on October 16, 2010 and amended on April 1, 2012. Under the agreement the company committed to pay the greater of $200,000 per year (increasing 5% per year) or 5% of EBITDA for these services until the company and BCM mutually agree to terminate the commitment. For the years ended December 31, 2014 and 2013, the company had management services fees of $234,332 and $223,143, respectively. The company is required to pay BCM a 2% fee of the amount of funds committed in any debt or equity financing from a third party as compensation for services in securing the financing. The company had expenses related to financing fees of $40,000 for the year ended December 31, 2013. In the event of an acquisition of another company, the company is required to pay a fee of $400,000 for acquisition and turnaround services to BCM, and would be subject to an increase of $60,000 per acquisition to the management fee amount described above. If a majority interest in the company is sold, a fee equal to three years of management fees is payable to BCM.

 

During the year ended December 31, 2013, the company repaid all of the promissory notes – majority stockholder and was charged interest totaling $89,262.

 

 

RESTORERS ACQUISITION INC.

 

NOTES TO FINANCIAL STATEMENTS 

December 31, 2014 and 2013

  

NOTE 7 – STOCK OPTIONS

 

On April 1, 2011, the company adopted the 2011 stock option plan (the plan). The plan provides for the award of stock options to purchase common stock of the company. The aggregate amount of shares available for issuance under this plan may not exceed 3,000 shares. Options awarded vest over ten years with no vesting in the first year. The options will also vest immediately upon a sale of the company, once vested; the options may be exercised at any point for ten years.

 

Stock option activity for 2014 and 2013 was as follows:

 

		Stock Options				Weighted- Average Exercise Price				Average Remaining Contractual Life				Aggregate Intrinsic Value
Outstanding at January 1, 2013			9.0			$	6,500				9.5			$	45,452
Granted			5.8				6,426				11.0				2,702
Forfeited			(4.5	)			(6,500	)							(22,726	)
OUTSTANDING AT DECEMBER 31, 2013			10.3				6,477				9.4				25,428
Granted, Exercised or Forfeited			—				—				—				—
OUTSTANDING AT DECEMBER 31, 2014			10.3			$	6,477				9.4			$	25,428

 

The following assumptions were used in the Black-Scholes model to value the options at grant date during the year ended December 31, 2013:

  

Expected Life			11 Years
Risk-Free Interest Rate			3.25	%
Dividend Yield			0	%
Expected Volatility			100	%

  

The compensation expense related to these options for the years ended December 31, 2014 and 2013 was not material to the financial statements and, thus, was not recorded.

 

 

RESTORERS ACQUISITION INC.

 

NOTES TO FINANCIAL STATEMENTS

December 31, 2014 and 2013

 

NOTE 8 – OTHER EXPENSES

 

Other expenses consist of the following:

 

		2014				2013
Amortization		$	1,667			$	12,761
Management Fees – Blackstreet			234,332				223,143
Board of Directors Fees			37,084				32,537
Miscellaneous Expense (Income)			22,365				(21,534	)
TOTAL OTHER EXPENSES		$	295,448			$	246,907

 

NOTE 9 – COMMITMENTS AND CONTINGENCIES

 

The company has an agreement with a third party fulfillment provider located in Missouri that is in effect through January 31, 2016. There is an option to renew the agreement for a two year extension, 120 days before the end of the initial term and subject to potential changes in cost structures.

  

The fulfillment provider receives and stores inventory, performs daily cycle counts, picks, packs and ships customer orders. Additional services such as, order taking, processing of customer payments, personalization, customer services, and order processing are also performed by the fulfillment provider.

 

 

RESTORERS ACQUISITION, INC.

  

SUPPLEMENTARY INFORMATION

  

YEARS ENDED 

DECEMBER 31, 2014 AND 2013

 

  

10990 Wilshire Boulevard  16th Floor  Los Angeles, CA 90024

310-873-1600 T  310-873-6600 F  www.greenhassonjanks.com

  

INDEPENDENT AUDITOR’S REPORT 

ON SUPPLEMENTARY INFORMATION

 

To the Board of Directors of 

Restorers Acquisition, Inc.

  

We have audited the financial statements of Restorers Acquisition, Inc. as of and for the years ended December 31, 2014 and 2013, and our report thereon dated March 27, 2015, which expressed an unmodified opinion on those financial statements, appears on Page 1. Our audits were conducted for the purpose of forming an opinion on the financial statements as a whole. The capitalization table for the years ended December 31, 2014 and 2013 are presented for purposes of additional analysis and are not a required part of the financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the financial statements. The information has been subjected to the auditing procedures applied in the audits of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the financial statements or to the financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole.

 

  

March 27, 2015 

Los Angeles, California

 

An independent member of HLB International, a worldwide network of accounting firms and business advisors.

 

 

RESTORERS ACQUISITION, INC. 

 

CAPITALIZATION TABLE 

 

As of December 31, 2014 and 2013

 

Shareholder		Shares Held				Equity Ownership				Fully Diluted Ownership				Weighted Average Original / Strike Price
Scrubs AC, LLC			528.5				92.3	%			90.6	%		$	1,063
Minority member			26.8				4.7	%			4.6	%			605
Minority member			17.5				3.1	%			3.0	%			605
Subtotal Outstanding Shares			572.8				100.0	%			98.2	%
Options:
Minority member			4.5								0.8	%			6,500
Minority member			5.8								1.0	%			6,426
Subtotal Options			10.3								1.8	%
Total Fully Diluted Shares			583.1								100.0	%

 

See Independent Auditor’s Report on Supplementary Information