Fortem Resources Inc. - FORM 8-K/A - EX-99.3 - EXHIBIT 99.2 - PROFORMA FINANCIAL STATEMENTS - June 30, 2017

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EX-99.1 - EXHIBIT 99.1 - FINANCIAL STATEMENTS - Fortem Resources Inc.ex99_1.htm
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PRO-FORMA CONSOLIDATED FINANCIAL STATEMENTS

 (Unaudited - Prepared by Management)

(Expressed in U.S. Dollars)

February 28, 2017



FORTEM RESOURCES INC.
PRO-FORMA CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(Unaudited – Prepared by Management)
(Expressed in U.S. Dollars)
AS AT FEBRUARY 28, 2017
   
Fortem February 28, 2017
    
Rolling Rock April 16, 2017
    
Note
    
Pro-forma Adjustments
    
Pro-forma Consolidated February 28, 2017
  
   
$
             $      
$
      
$
    
Assets
                                      
                                       
Current
                                      
Cash
    
209,618
      
-
      
2
      
(100,000
)
    
-
  
                     
3(b
)
    
(109,618
)
        
Receivables
    
27,103
      
-
              
-
      
27,103
  
Prepaid expenses
    
24,099
      
-
              
-
      
24,099
  
     
260,820
      
-
              
(209,618
)
    
51,202
  
                                         
Deposit
    
33,082
      
-
              
-
      
33,082
  
Due from related party
    
-
      
-
      
3(b
)
    
130,397
      
-
  
                     
3(c
)
    
(130,397
)
        
Equipment
    
54,956
      
-
              
-
      
54,956
  
Oil and gas properties, full cost method
    
123,578,323
      
130,397
      
2
      
39,135,347
      
186,988,903
  
                     
2
      
24,144,836
          
                                         
     
123,927,181
      
130,397
              
63,070,565
      
187,128,143
  
                                         
Liabilities
                                        
                                         
Current
                                        
Bank indebtedness
    
-
      
-
      
3(b
)
    
20,779
      
20,779
  
Accounts payable and accrued liabilities
    
345,887
      
26,032
      
2
      
9,315
      
381,234
  
Loan payable
    
54,722
      
-
              
-
      
54,722
  
Advance payable
    
4,058
      
130,397
      
3(c
)
    
(130,397
)
    
4,058
  
Due to related parties
    
108,831
      
-
              
-
      
108,831
  
Note payable
    
18,825
      
-
              
-
      
18,825
  
Derivative liabilities
    
2,590,477
      
-
              
-
      
2,590,477
  
     
3,122,800
      
156,429
              
(100,303
)
    
3,178,926
  
                                         
Asset retirement obligation
    
24,546
      
-
              
-
      
24,546
  
Deferred tax liabilities
    
40,269,805
      
-
      
2
      
24,144,836
      
64,414,641
  
     
43,417,151
      
156,429
              
24,044,533
      
67,618,113
  
                                         
Shareholders' equity
                                        
Capital stock
    
70,428
      
-
      
2
      
20,000
      
90,428
  
Members' capital
    
-
      
-
              
-
      
-
  
Additional paid in capital
    
81,277,885
      
-
      
2
      
38,980,000
      
120,257,885
  
Obligation to issue shares
    
6,000,000
      
-
              
-
      
6,000,000
  
Share subscriptions receivable
    
(110,000
)
    
-
              
-
      
(110,000
)
Accumulated other comprehensive loss
    
(383,257
)
    
-
              
-
      
(383,257
)
Accumulated deficit
    
(6,345,026
)
    
(26,032
)
    
2
      
26,032
      
(6,345,026
)
     
80,510,030
      
(26,032
)
            
39,026,032
      
119,510,030
  
                                         
     
123,927,181
      
130,397
              
63,070,565
      
187,128,143
  

The accompanying notes are integral part of these pro-forma consolidated financial statements.


FORTEM RESOURCES INC.
PRO-FORMA CONSOLIDATED STATEMENT OF COMPREHENSIVE LOSS
(Unaudited – Prepared by Management)
(Expressed in U.S. Dollars)
PERIOD ENDED FEBRUARY 28, 2017
                               
   
Fortem Resources For the year ended February 28, 2017
    
Rolling Rock For the period ended April 16, 2017
    
Note
    
Pro-forma Adjustments
    
Pro-forma Consolidated
  
   
$
             $      
$
      
$
    
                                       
Expenses
                                      
Consulting fees
    
70,592
      
-
              
-
      
70,592
  
Depreciation
    
3,409
      
-
              
-
      
3,409
  
Management fees
    
233,786
      
-
              
-
      
233,786
  
Office
    
51,373
      
-
              
-
      
51,373
  
Professional fees
    
176,057
      
26,032
              
-
      
202,089
  
     
(535,217
)
    
(26,032
)
            
-
      
(561,249
)
                                         
Interest income
    
251
      
-
              
-
      
251
  
Accretion expense
    
(202,263
)
    
-
              
-
      
(202,263
)
Gain on settlement of debt
    
79,239
      
-
              
-
      
79,239
  
Loss on settlement of convertible debt
    
(1,309,022
)
    
-
              
-
      
(1,309,022
)
Interest expense
    
(16,871
)
    
-
              
-
      
(16,871
)
Financing fee
    
(73,621
)
    
-
              
-
      
(73,621
)
Foreign exchange gain
    
271,294
      
-
              
-
      
271,294
  
Gain on write-off of accounts payable
    
215,348
      
-
              
-
      
215,348
  
Change in fair value of derivative liability
    
(1,197,268
)
    
-
              
-
      
(1,197,268
)
     
(2,232,913
)
    
-
              
-
      
(2,232,913
)
                                         
Net loss for the year
    
(2,768,130
)
    
(26,032
)
            
-
      
(2,794,162
)
                                         
Foreign currency translation
    
(249,977
)
    
-
              
-
      
(249,977
)
                                         
Comprehensive loss for the year
    
(3,018,107
)
    
(26,032
)
            
-
      
(3,044,139
)















The accompanying notes are integral part of these pro-forma consolidated financial statements.


FORTEM RESOURCES INC.
NOTES TO PRO-FORMA CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited – Prepared by Management)
(Expressed in U.S. Dollars)
FEBRUARY 28, 2017
 
1.
BASIS OF PRESENTATION

The accompanying unaudited pro-forma consolidated financial statements of Fortem Resources Inc. ("Fortem" or the “Company”) have been prepared by management in accordance with United States Generally Accepted Accounting Principles (“US GAAP”) from information derived from the unaudited pro-forma consolidated financial statements of Fortem and the financial statements of Rolling Rock Resources, LLC (“Rolling Rock”) together with other information available to the Company. In the opinion of the Company's management, the pro-forma consolidated financial statements include all adjustments necessary for the fair presentation of the transactions as described below.

The unaudited pro-forma consolidated financial statements are not necessarily indicative of the financial position or results of operations which would have resulted if the combination had actually occurred as set out in Note 2.

The unaudited pro-forma consolidated financial statements should be read in conjunction with the February 28, 2017 unaudited pro-forma consolidated financial statements of Fortem which included acquisitions of Colony          Energy, LLC and Black Dragon Energy, LLC, the February 28, 2017 audited financial statements of Fortem and the April 16, 2017 audited financial statements of Rolling Rock.

2.
PRELIMINARY PURCHASE PRICE ALLOCATION

In April 2017, the Company entered into and closed a Membership Interest Purchase Agreement with two arm’s length vendors to acquire all membership interests of Rolling Rock, a Nevada limited liability company. Rolling Rock has the right to acquire a 50% working interest in and to certain leases, hydrocarbons, wells, agreements, equipment, surface rights agreements and assignable permits totaling approximately 101,888 acres (160 sections) at an 80% net revenue interest located in the Mancos formation in the Southern Uinta Basin, Utah (“Rolling Rock Property”).

In consideration for the acquisition of Rolling Rock, the Company issued an aggregate of 20,000,000 shares of its common stock to the two vendors on the closing date (issued at a fair value of $39,000,000) and paid $100,000 prior to the closing as a non-refundable deposit. 

The assets and liabilities of Rolling Rock assumed on the acquisition are as follows:
 
   
$
    
Oil and gas properties
    
130,397
  
Accounts payable and accrued liabilities
    
(26,032
)
Advance payable
    
(130,397
)
         
Net liabilities
    
(26,032
)

The total consideration for the acquisition is as follows:
 
   
$
    
Value of shares issued
    
39,000,000
  
Cash paid
    
100,000
  
Transaction costs
    
9,315
  
     
39,109,315
  
Add:  net liabilities
    
26,032
  
         
Consideration paid over the net liabilities of Rolling Rock
    
39,135,347
  

The consideration paid plus the net liabilities of Rolling Rock has been added to the oil and gas property to reflect the fair value of the Rolling Rock Property.

As a result of the acquisition, the Company recorded a deferred tax liability of $24,144,836.
 
 

FORTEM RESOURCES INC.
NOTES TO PRO-FORMA CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited – Prepared by Management)
(Expressed in U.S. Dollars)
FEBRUARY 28, 2017
 
3.
PRO-FORMA TRANSACTIONS

The pro-forma consolidated financial statements have been prepared based on the following assumptions:

a)
The unaudited pro-forma consolidated statement of financial position gives effect to the acquisition as if it had occurred on February 28, 2017.  The unaudited pro-forma consolidated statement of comprehensive loss gives effect to the acquisition as if it occurred on the first day of the period presented.

b)
Fortem advanced $130,397 as a loan to Rolling Rock.

c)
The intercompany loan mentioned in 3(b) above has been eliminated.


Fortem Resources Inc. Reports