Attached files
| file | filename |
|---|---|
| EX-99.1 - Edge Data Solutions, Inc. | ex99-1.htm |
| 8-K/A - Edge Data Solutions, Inc. | form8-ka.htm |
Blockchain Holdings Capital Ventures, Inc.
(Formerly Southeastern Holdings, Inc.)
and Blockchain Holdings, LLC
Unaudited Combined Pro Forma Financial Statements
As of August 23, 2018 and for the Period from February 5, 2018 (Inception) Through August 23, 2018
| Page | |
| Unaudited Pro Forma Combined Financial Statements: | |
| Headnote | 2 |
| Unaudited Pro Forma Combined Balance Sheets | 3 |
| Unaudited Pro Forma Combined Statements of Operations | 4 |
Blockchain Holdings Capital Ventures, Inc.
(Formerly Southeastern Holdings, Inc.)
and Blockchain Holdings, LLC
Note to Unaudited Combined Pro Forma Financial Statements
As of August 23, 2018 and for the Period from February 5, 2018 (Inception) Through August 23, 2018
On August 23, 2018, Blockchain Holdings Capital Ventures, Inc. (Formerly Southeastern Holdings, Inc.) entered into a Bill of Sale and Assignment and Assumption Agreement with Blockchain Holdings, LLC (“Blockchain”) pursuant to which the Company purchased all of the assets of Blockchain which are used in the business of sourcing of blockchain mining equipment from various suppliers for their customers and also providing management of the equipment hosted, mining pools and tech work on such equipment. The Company issued 300,000,000 shares of its common stock, par value $.0001 to the members of Blockchain in exchange for the assets of Blockchain.
The Company evaluated the August 23, 2018 acquisition of Blockchain Holdings, LLC’s outstanding interests and determined that the acquisition falls under guidance of the SEC’s Financial Reporting Manual, Section 12100, which deems the transaction to be a change in control and a “capital transaction in substance.” The Merger is being accounted for as a reverse recapitalization. Reverse recapitalization accounting applies when a non-operating public shell company (Southeastern Holdings, Inc.) acquires a private operating company (Blockchain) and the owners and management of the private operating company have actual or effective voting and operating control of the combined company. A reverse recapitalization is equivalent to the issuance of stock by the private operating company for the net monetary assets of the public shell corporation accompanied by a recapitalization with accounting similar to that resulting from a reverse acquisition, except that no goodwill or other intangible assets are recorded. The reverse recapitalization accounting is attributable to a long-held position of the staff of the Securities and Exchange Commission as the acquisition of a non-operating public shell company does not qualify as a business for business combination purposes, as described in Accounting Standards Codification Topic 805, Business Combinations. The Company’s recapitalization entry resulted in the following changes to equity on August 23, 2018, which are contemplated in the accompanying unaudited pro forma financial statements:
| Prior to Recapitalization | Transaction August 23, 2018 | Recapitalization August 23, 2018 | After Recapitalization | |||||||||||||
| Class A super voting preferred stock* | $ | 1,000 | $ | - | $ | (1,000 | ) | $ | - | |||||||
| Class B non-voting preferred stock* | - | - | ||||||||||||||
| Common stock | 13,836 | 30,000 | 43,836 | |||||||||||||
| Additional paid-in capital | 1,526 | (121,607 | ) | (120,081 | ) | |||||||||||
| Accumulated deficit | (92,607 | ) | 92,607 | - | ||||||||||||
| Total Stockholders’ Equity | $ | (76,245 | ) | $ | 30,000 | $ | (30,000 | ) | $ | (76,245 | ) | |||||
*The Company discovered that all of its historical Preferred Stock classes prior to the asset purchase were improperly filed with the State of Delaware and therefore legally null and void. The Company eliminated the outstanding Preferred Stock from the historical entity in the recapitalization accounting on August 23, 2018.
The accompanying pro forma combined financial statements as of September 30, 2018 and for the nine months then ended have been combined to present the financial results of all the acquired Companies in one set of financial statements.
| -2- |
Blockchain Holdings Capital Ventures, Inc.
(Formerly Southeastern Holdings, Inc.)
and Blockchain Holdings, LLC
Unaudited Combined Pro Forma Balance Sheets
As of August 23, 2018
| Blockchain Holdings Capital Ventures, Inc. (Formerly Southeastern Holdings, Inc.) | Blockchain Holdings, LLC | Pro Forma Adjustments | Pro Forma Combined | ||||||||||||||
| (historical) | (historical) | ||||||||||||||||
| Assets | |||||||||||||||||
| Current Assets: | |||||||||||||||||
| Cash and cash equivalents | $ | - | $ | 9,615 | $ | - | $ | 9,615 | |||||||||
| Total Current Assets | - | 9,615 | 9,615 | ||||||||||||||
| TOTAL ASSETS | $ | - | $ | 9,615 | $ | - | $ | 9,615 | |||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIENCY) | |||||||||||||||||
| Current Liabilities: | |||||||||||||||||
| Accounts payable | $ | 74,434 | $ | 74,434 | |||||||||||||
| Accrued expenses | 1,811 | 1,811 | |||||||||||||||
| Total Current Liabilities | 76,245 | - | - | 76,245 | |||||||||||||
| Non-Current Liabilities: | |||||||||||||||||
| Total Non-Current Liabilities | - | - | - | - | |||||||||||||
| Total Liabilities | 76,245 | - | - | 76,245 | |||||||||||||
| Stockholders' Equity (Deficiency): | |||||||||||||||||
| Class A super majority voting preferred stock | 1,000 | - | (1,000 | ) | [a] | - | |||||||||||
| Class C convertible preferred non-voting stock | - | - | - | - | |||||||||||||
| Common stock | 13,862 | - | 30,000 | [b] | 43,862 | ||||||||||||
| Additional paid-in capital | 1,500 | - | (121,607 | ) | [c] | (120,107 | ) | ||||||||||
| Accumulated deficit | (92,607 | ) | 9,615 | 92,607 | [d] | 9,615 | |||||||||||
| Total Stockholders' Equity (Deficiency) | (76,245 | ) | 9,615 | - | (66,630 | ) | |||||||||||
| TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIENCY) | $ | - | $ | 9,615 | $ | - | $ | 9,615 | |||||||||
| The Company made the following adjustments in connection with the transaction: | |||||||||||||||||
| [a] Write off historical preferred stock deemed legally void. | |||||||||||||||||
| [b] Record par value portion of common stock issued for asset purchase. | |||||||||||||||||
| [c] This entry consists of the following recapitalization elements: | |||||||||||||||||
| Record APIC portion of common stock issued for transaction | $ | 270,000 | |||||||||||||||
| Move historical issuer accumulated deficit to additional paid-in capital | (92,607 | ) | |||||||||||||||
| Record loss on total value of acquisition | (300,000 | ) | |||||||||||||||
| Write off historical preferred stock deemed legally void | 1,000 | ||||||||||||||||
| Adjustment | $ | (121,607 | ) | ||||||||||||||
| [d] Move historical issuer retained earnings to additional paid-in capital for recapitalization. | |||||||||||||||||
| -3- |
Blockchain Holdings Capital Ventures, Inc.
(Formerly Southeastern Holdings, Inc.)
and Blockchain Holdings, LLC
Unaudited Combined Pro Forma Statements of Operations
For the Period from February 5, 2018 (Inception) Through August 23, 2018
| Blockchain Holdings Capital Ventures, Inc. (Formerly Southeastern Holdings, Inc.) | Blockchain Holdings, LLC | Pro Forma Adjustments | Pro Forma Combined | |||||||||||||
| (historical) | (historical) | |||||||||||||||
| Revenues: | ||||||||||||||||
| Equipment sales - related party | $ | - | $ | 150,104 | $ | - | $ | 150,104 | ||||||||
| Consulting and management fee revenue - related party | - | 18,954 | - | 18,954 | ||||||||||||
| Equipment sales | - | 72,020 | - | 72,020 | ||||||||||||
| Consulting and management fee revenue | - | 44,380 | - | 44,380 | ||||||||||||
| Mining commission revenue | - | 19,892 | - | 19,892 | ||||||||||||
| Total Revenue | - | 305,350 | - | 305,350 | ||||||||||||
| Cost of goods sold - related party | - | (156,371 | ) | - | (156,371 | ) | ||||||||||
| Cost of goods sold | - | (74,901 | ) | - | (74,901 | ) | ||||||||||
| Total Cost of Goods Sold | - | (231,272 | ) | - | (231,272 | ) | ||||||||||
| Gross Margin | - | 74,078 | - | 74,078 | ||||||||||||
| Operating Expenses: | ||||||||||||||||
| Sales and marketing | - | 31,945 | - | 31,945 | ||||||||||||
| General and administrative | 43,348 | 5,968 | - | 49,316 | ||||||||||||
| Total Operating Expenses | 43,348 | 37,913 | - | 81,261 | ||||||||||||
| Income from operations | (43,348 | ) | 36,165 | - | (7,183 | ) | ||||||||||
| Other Income and Expense | ||||||||||||||||
| Impairment of long-lived assets | - | (26,550 | ) | - | (26,550 | ) | ||||||||||
| Total Other Income (Expense) | - | (26,550 | ) | - | (26,550 | ) | ||||||||||
| Net Income/(Loss) | $ | (43,348 | ) | $ | 9,615 | $ | - | $ | (33,733 | ) | ||||||
| Net Income/(Loss) per share (basic and diluted) | $ | (0.00 | ) | $ | (0.00 | ) | ||||||||||
| Weighted average number of common shares outstanding | 40,667,707 | 40,667,707 | ||||||||||||||
| -4- |