<SEC-DOCUMENT>0001017386-16-000532.txt : 20160908
<SEC-HEADER>0001017386-16-000532.hdr.sgml : 20160908
<ACCEPTANCE-DATETIME>20160908112717
ACCESSION NUMBER: 0001017386-16-000532
CONFORMED SUBMISSION TYPE: 8-K/A
PUBLIC DOCUMENT COUNT: 4
CONFORMED PERIOD OF REPORT: 20160630
ITEM INFORMATION: Financial Statements and Exhibits
FILED AS OF DATE: 20160908
DATE AS OF CHANGE: 20160908
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: Newgioco Group, Inc.
CENTRAL INDEX KEY: 0001080319
STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE [6500]
IRS NUMBER: 330823179
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 8-K/A
SEC ACT: 1934 Act
SEC FILE NUMBER: 000-50045
FILM NUMBER: 161875147
BUSINESS ADDRESS:
STREET 1: 130 ADELAIDE STREET, WEST
STREET 2: SUITE 701
CITY: TORONTO
STATE: A6
ZIP: M5H 2K4
BUSINESS PHONE: 647-229-0136
MAIL ADDRESS:
STREET 1: 130 ADELAIDE STREET, WEST
STREET 2: SUITE 701
CITY: TORONTO
STATE: A6
ZIP: M5H 2K4
FORMER COMPANY:
FORMER CONFORMED NAME: EMPIRE GLOBAL CORP.
DATE OF NAME CHANGE: 20051004
FORMER COMPANY:
FORMER CONFORMED NAME: TRADESTREAM GLOBAL CORP.
DATE OF NAME CHANGE: 20050727
FORMER COMPANY:
FORMER CONFORMED NAME: VIANET TECHNOLOGY GROUP LTD
DATE OF NAME CHANGE: 20050707
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K/A
<SEQUENCE>1
<FILENAME>emgl160907-8ka_odissea.txt
<DESCRIPTION>AMENDMENT NO. 2 - ACQUISITION OF ODISSEA BETRIEBSINFORMATIK BERATUNG GMBH
<TEXT>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------
FORM 8-K/A
Amendment No. 2
CURRENT REPORT Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: September 7, 2016
(Date of earliest reported event): (June 30, 2016)
NEWGIOCO GROUP, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 000 - 50045 33-0823179
(State or other (Commission File Number) (I.R.S. Employer
jurisdiction of Identification Number)
incorporation or
organization)
130 Adelaide Street West, Suite 701
Toronto, Ontario M5H 2K4, Canada
(Address of principal executive offices)
(647) 229-0136
(Registrant's telephone number)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registration under any of
the following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
<PAGE>
EXPLANATORY NOTE
On July 1, 2016, the company filed a Current Report on Form 8-K (the "Original
Form 8-K"), which was amended on August 25, 2016 (the "Amendment No. 1"), to
report the completion of its acquisition of all of the issued and outstanding
shares of Odissea Betriebsinformatik Beratung Gmbh ("Odissea") from its selling
shareholders. This Amendment No. 2 to the Original Form 8-K amends and
supplements Item 9.01 of the Original Form 8-K to include the financial
information described in Item 9.01 below which was not previously filed with the
Original Form 8-K and which is permitted to be filed by amendment no later than
71 calendar days after the date on which the Original Form 8-K was required to
be filed. Except as stated in the Explanatory Note, no other information
contained in the Original Form 8-K is changed.
Item 9.01 Financial Statements and Exhibits
(a) Financial Statements of Business Acquired
The financial statements for Odissea required by Item 9.01(a) of Form 8-K are
included as Exhibit 99.1 and Exhibit 99.2 to this Amendment No. 2 to the
Original Form 8-K and incorporated herein by reference.
(b) Pro Forma Financial Information
The pro forma financial information for Newgioco Group, Inc. required by Item
9.01(b) of Form 8-K is included as Exhibit 99.3 to this Amendment No. 2 to the
Original Form 8-K and incorporated herein by reference.
(c) Exhibits
The exhibits listed in the following Exhibit Index are filed as part of this
current report.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
DATED: September 7, 2016. NEWGIOCO GROUP, INC.
By: /s/ MICHELE CIAVARELLA, B.SC
------------------------------
MICHELE CIAVARELLA
Chairman of the Board
Chief Executive Officer
EXHIBIT INDEX
Exhibit No. Description
99.1 Audited financial statements of Odissea Betriebsinformatik Beratung Gmbh
as of and for the year ended December 31, 2015 and Independent Auditors
Report therein.
99.2 Unaudited interim financial statements of Odissea Betriebsinformatik
Beratung Gmbh for the six months ended June 30, 2016 and 2015 and
Independent Auditors Report therein.
99.3 Unaudited pro forma combined financial information and explanatory notes
for the six months ended June 30, 2016 and the year ended December 31,
2015.
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>emgl160907-ex991_odissea.txt
<DESCRIPTION>AUDITED FINANCIAL STATEMENTS
<TEXT>
EXHIBIT 99.1
Chartered Public Accountants Gruber
Steuerberatungs GmbH
Annual financial statement as of
12/31/2015
ODISSEA Betriebsinformatik Beratung GmbH
Salurner Strasse 12, 6020 Innsbruck
<PAGE>
TABLE OF CONTENTS
PAGE
AUDITORS REPORT
AUDIT CONTRACT AND PERFORMANCE OF THE ENGAGEMENT 3
BREAKDOWN AND DESCRIPTION OF SIGNIFICANT ITEMS IN THE
FINANCIAL STATEMENTS 4
SUMMARY OF AUDIT FINDINGS 4
AUDITOR'S REPORT 4
COMPILATION REPORT 7
LEGAL STATUS 9
TAX STATUS 9
BALANCE SHEET AS OF 12/31/2015 10
PROFIT & LOSS STATEMENT 11
DETAILED ASSETS 13
DETAILED LIABILITIES 14
DETAILED PROFIT & LOSS STATEMENT 16
APPENDIX 21
ENCLOSURES TO APPENDIX 25
NOTES TO THE BALANCE SHEET 26
ASSET ANALYSIS 27
DETAILED ASSET ANALYSIS 28
ASSET ADDITIONS 31
DEPRECIATION FORECAST 32
ODISSEA Betriebsinformatik Beratung GmbH
<PAGE>
To the
Members of Management of
Odissea Betriebsinformatik Beratung GmbH,
Luca Pasquini and Gabriele Peroni
Salurner StraBe 12, Innsbruck
We have completed the audit of the financial statements as of 31.12.2015 of
Odissea Betriebsinformatik Beratung GmbH,
Innsbruck,
(referred to as "the Company")
and provide the results of our audit in the following report:
1. Audit contract and performance of the engagement
By management resolution of Odissea Betriebsinformatik Beratung GmbH, Innsbruck,
we were elected as auditor for the voluntary audit of fiscal year 2015. The
Company, represented by the management board, concluded an audit contract with
us to audit the financial statements as of 31.12.2015, including the accounting
system pursuant to Sections 269 et seqq. UGB.
The Company is a small corporation pursuant to Section 221 UGB.
The audit is a voluntary audit.
The audit included assessing whether the statutory requirements were adhered to.
We conducted our audit in accordance with the legal requirements and generally
accepted standards on auditing as applied in Austria. These standards require
that we comply with International Standards on Auditing - ISAs. An auditor
conducting an audit obtains reasonable assurance about whether the financial
statements are free from material misstatement. Absolute assurance is not
attainable due to the inherent limitations of any accounting and internal
control system and due to the sample-based test nature of an audit, there is an
unavoidable risk that material misstatements in the financial statements remain
undetected. Areas which are generally covered in special engagements were not
included in our scope of work.
We performed the audit, with interruptions in August 2016 mainly at the our
office in Innsbruck. The audit was substantially completed at the date of this
report.
Auditor responsible for the proper performance of the engagement is Mr. Mag.
Wilfried Stauder, Austrian Certified Public Accountant.
Our audit is based on the audit contract concluded with the Company. The
"General Conditions of Contract issued by the Austrian Chamber of Public
Accountants and Tax Advisors" (refer to Appendix II) form an integral part of
the audit contract. These conditions of contract do not only apply to the
Company and the auditor, but also to third parties. Section 275 UGB applies with
regard to our responsibility and liability as auditors towards the Company and
towards third parties.
3
<PAGE>
2. Breakdown and description of significant items in the financial statements
The breakdown and description of all significant financial statement items are
included in the notes to the financial statements. Therefore, we refer to the
respective disclosures made by the management in the notes to the financial
statements.
3. Summary of audit findings
3.1. Compliance of the accounting system and the financial statements
During our audit, we obtained evidence that the statutory requirements and
accounting principles generally accepted in Austria have been complied with.
In line with our risk and controls based audit approach and to the extent we
considered necessary for the purpose of expressing an opinion, we considered
internal controls related to sub processes of the financial reporting process as
part of our audit.
With regard to the compliance of the financial statements with all applicable
statutory requirements we refer to the auditor's report.
3.2. Information provided
The Company's legal representatives provided all evidence and explanations
requested by us. We obtained a representation letter signed by the legal
representatives which we included in our working papers.
3.3. Reporting in accordance with Section 273 (2) and (3) UGB
During our audit we did not note any facts which indicate there could be
substantial doubt about the Company's ability to continue as a going concern,
or which indicate a material deterioration of the Company's performance or a
material offence of the Company's legal representatives or its employees against
Austrian law or the Company's articles of association. We did not note any
material weaknesses in the internal controls over the financial reporting
process. The financial statements do not meet the requirements for the assumed
need of reorganization in accordance with Section 22 Paragraph 1 Subsection 1
URG (Austrian Corporate Restructuring Act).
4. Auditor's Report
Report on the Financial Statements
We have audited the accompanying financial statements of
Odissea Betriebsinformatik Beratung GmbH,
Innsbruck,
for the fiscal year from 1.1.2015 to 31.12.2015. These financial statements
comprise the statement of financial position as of 31.12.2015, the income
statement for the fiscal year ended 31.12.2015, and the notes.
4
<PAGE>
Our responsibility and liability as auditor is guided by Section 275 UGB
(liability regulations for the audit of small and medium-sized companies) and is
limited to a total of 2 million Euros towards the Company and towards third
parties.
Management's Responsibility for the Financial Statements
The Company's management is responsible for the preparation and fair
presentation of these financial statements in accordance with Austrian Generally
Accepted Accounting Principles (UGB) and for such internal control as management
determines is necessary to enable the preparation of financial statements that
are free from material misstatement, whether due to fraud or error.
Auditors' Responsibility
Our responsibility is to express an opinion on these financial statements based
on our audit. We conducted our audit in accordance with Austrian Standards on
Auditing. Those standards require that we comply with International Standards on
Auditing - ISA. In accordance with International Standards on Auditing, we are
required to comply with professional requirements and plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
from 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 our 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, we consider 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. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of 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 reasonable basis for our audit opinion.
5
<PAGE>
Opinion
Our audit did not give rise to any objections. In our opinion, which is based on
the results of our audit, the financial statements comply with legal
requirements present fairly, in all material respects, the financial position of
the Company as of 31.12.2015 and its financial performance for the year then
ended in accordance with Austrian Generally Accepted Accounting Principles.
Innsbruck, on 11th August 2016
Stauder Schuchter Kempf
WirtschaftsprUfungs - und Steuerberatungs GmbH
/s/ Mag. Wilfried Stauder
Mag. Wilfried Stauder
Austrian Certified Public Accountant
This report is a translation of the original report in German, which is solely
valid.
Publication of the financial statements together with our auditor's opinion may
only be made if the financial statements and the management report are identical
with the audited version attached to this report. Section 281 paragraph 2 UGB
(Austrian Commercial Code) applies.
6
<PAGE>
Compilation Report
To the Board of Directors of
ODISSEA Betriebsinformatik Beratung GmbH, 6020 Innsbruck, Salurner Strasse 12.
Report on the compilation of annual financial statement of ODISSEA
Betriebsinformatik Beratung GmbH as of 12/31/2015:
As commissioned we have created the following annual financial statement of
ODISSEA Betriebsinformatik Beratung GmbH as of 12/31/2015 - comprising of
balance sheet, profit & loss statement as well as appendix - based on the
accounts and inventory as well as information on balance sheet and accounting
methods to be used.
This financial statement was compiled based on the activities (accounting)
carries out by us and documents, books and inventory evidence submitted to us,
which we did not audit - as commissioned - for correctness or plausibility, and
the audit also used the information provided to us. You are directly responsible
for the accounting methods as well as inventory management and annual financial
statements in accordance with the accounting rules of the company (UGB) and the
supplementary provisions of the articles of association.
You also responsible for the accuracy and completeness of the documents and
information provided to us, even for users of the annual financial statement
prepared by us. In this context, we would like to refer to the letter of
representation that you have signed at our request.
The information was provided by the board of directors.
You made the decisions about the voting rights and other discretionary
decisions.
We have prepared this report in accordance with the expert opinion KFS/RL 26
"Principles for the preparation of annual financial statements". The enclosed
General Terms & Conditions (AAB) for audit professionals of the Chamber of
Chartered Accountants (KWT) in the currently valid version shall be applicable
for the preparation of this report.
7
<PAGE>
This statement can be sent to Third Parties only by enclosing our audit report.
If the annual financial statement prepared by us is disclosed to any Third
Parties, the statements on liability against Third Parties mentioned in Point 8
of AAB for audit professionals of KWT shall be applicable.
Wirtschaftstreuhander Gruber Steuerberatungs GmbH
Hauptstrasse 14a
6401 Inzing
Inzing on, 08/10/2016
8
<PAGE>
LEGAL STATUS
Company: ODISSEA Betriebsinformatik Beratung GmbH
Headquarters of the company: Innsbruck
Business address: 6020 Innsbruck, Salurner Strasse 12
Establishment: Articles of Association as of 06/25/2013
Legal form GmbH [Limited Liability Company]
Company register no. 398599a
Entry in company register: 09/07/2013
Business purpose: IT consulting
Fiscal year: 10/01/2015 to 12/31/2015
Share capital: 35000
Size: Small
Shareholders: Luca Pasquini
Gabriele Peroni
Paid-up capital: Luca Pasquini EUR 17,500
Gabriele Peroni EUR 17,500
Managing director(s): Annamarie Iva Ornella Feraresi
Luca Pasquini
TAX STATUS
Tax office: INNSBRUCK
Tax ID no.: 307/8235
UID Number: ATU69273029
Tax consultants: Wirtschaftstreuhander Gruber Steuerberatungs
GmbH 6401 Inzing Hauptstrasse 14a AUSTRIA
9
<PAGE>
BALANCE SHEET AS OF 31/12/2015
Assets 12/31/2015 12/31/2014
EUR EUR
A. FIXED ASSETS
I. INTANGIBLE ASSETS
1. other fixed assets, operating and
office equipment 11,013.38 5,275.64
--------- --------
11,013.38 5,275.64
ll. TANGIBLE ASSETS
1. Other assets, operating licenses 22,851.92 13,796.80
--------- --------
22,851.92 13,796.80
--------- --------
33,865.30 19,072.44
B. CURRENT ASSETS
I. Stocks
1. Trade receivables 0.00 0.00
--------- --------
0.00 0.00
11. RECEIVABLES AND OTHER ASSETS
1. Trade receivables 73,548.47 30,000.00
2. Other Assets 8,454.00 14,846.28
--------- --------
82,002.47 44,846.28
ll. CASH BALANCE, CHECKS, DEPOSITS WITH
CREDIT INSTITUTIONS
1. Deposit with credit institutions 50,181.77 30,201.30
--------- --------
50,181.77 30,201.30
--------- --------
132,184.24 75,047.58
C ACCRUALS AND DEFERRALS
1. Active accruals & deferrals 9,000.00 12,000.00
--------- --------
9,000.00 12,000.00
--------- --------
TOTAL ASSETS 175,049.54 106,120.02
========= ========
A. SHAREHOLDERS' EQUITY
I. SHARE CAPITAL
1. Share capital 35,000.00 35,000.00
--------- --------
35,000.00 35,000.00
--------- --------
ll. NET PROFIT
Profit & Loss carried forward (168,698.27) (32,088.02)
Annual profit & loss 59,177.70 (136,610.25)
--------- --------
(109,520.57) (168,698.27)
--------- --------
(74,520.57) (133,698.27)
10
<PAGE>
B. PROVISIONS
1. Tax provisions 2,883.00 937.00
2. Other provisions 44,292.13 17,446.76
--------- --------
47.175.13 18,383.76
C. LIABILITIES
1. Trade payables 25,186.29 18,002.36
2. Other liabilities:
Other liabilities from taxes 14,829.27 932.17
Other liabilities from social contributions 0.00 5,009.01
162,379.42 202,500.00
--------- --------
177,208.69 203,432.17
--------- --------
202.394.98 221.434.53
--------- --------
TOTAL LIABILITIES 175,049.54 106,120.02
========= ========
PROFIT & LOSS STATEMENT
for the fiscal year from 01/01/2015 to 12/31/2015
2015 2014
EUR EUR
1. REVENUES
a) Revenues 330,499.00 6,946.17
b) Service revenue 389,783.51 308,700.00
--------- --------
720,282.51 315,464.17
2. CHANGES TO FINISHED GOODS AND WORK IN PROGRESS AND
SERVICES NOT YET INVOICED
0.00 -11,400.00
--------- --------
3. OTHER OPERATING INCOME
a) Income from sales of assets (1,042.50) 0.00
--------- --------
(1,042.50) 0.00
4. COST OF MATERIALS AND OTHER MANUFACTURING COSTS
a) Cost of materials (1,261.70) 0.00
b) Expenses for services procured (262,898.00) (133,301.00)
c) Cash discounts received 5.11 0.00
--------- --------
(264,154.59) (133,301.00)
5. PERSONNEL EXPENSES
a) Wages 0.00 0.00
b) Salaries (252,941.15) (200,576.39)
c) Expenses for severance payments (2,659.96) (2,598.94)
d) Expenses for legally prescribed
social contributions as well as other
mandatory contributions (55,552.92) (52,473.22)
11
<PAGE>
e) Other social expenses (124.15) 0.00
--------- --------
(311,278.18) (255,648.55)
6. WRITE-OFFS
a) Depreciation on intangible assets
and activated expenses for business
Expansion (1,212.40) (855.70)
(17,679.69) (9,025.02)
--------- --------
(17,679.69) (9,025.02)
7. OTHER BUSINESS EXPENSES
a) Taxes and charges if they are not
dependent on income or revenue (471.14) (1,212.40)
b) Office space (14,436.14) (17,390.09)
c) Energy expenses (812.61) (1,072.50)
d) Maintenance (5,306.33) 0.00
e) Vehicle expenses (8,917.55) (1,730.78)
f) Advertisement and similar expenses (632.05) (1,722.40)
g) Travel expenses (6,342.92) (6,185.10)
h) Communication expenses (3,536.14) (3,564.91)
i) Office expenses (248.27) (55.69)
j) Rent and leasing expenses (8,893.97) (847.85)
k) Other operating expenses (11,902.73) (7,784.13)
--------- --------
(64,499.85) (41,565.85)
8. OPERATING PROFIT 61,627.70 (135,294.25)
9. INTEREST AND SIMILAR INCOME 0.00 0.00
--------- --------
0.00 0.00
10. INTEREST AND SIMILAR EXPENSES (4.00) (4.00)
--------- --------
(4.00) (4.00)
11. NET OTHER INCOME/(EXPENSES) (4.00) (4.00)
12. INCOME BEFORE INCOME TAXES
61,623.70 (135,298.25)
13. INCOME TAXES (2,446.00) (1,312.00)
14. NET INCOME/(LOSS) 59,177.70 (136,610.25)
15. NET INCOME/(LOSS) FOR THE YEAR 59,177.70 (136,610.25)
16. ACCUMULATED DEFICIT, BEGINNING (168,698.27) (32,088.02)
17. ACCUMULATED DEFICIT, ENDING (109,520.57) (168,698.27)
12
<PAGE>
DETAILED ASSETS
12/31/2015 12/31/2014
EUR EUR
A. FIXED ASSETS
l. INTANGIBLE ASSETS
1. Concessions, industrial rights and similar rights
and values and resulting licenses
110 Patent and license rights 2,380.02 5,275.64
120 Data processing 8,633.36 0.00
11,013.38 5,275.64
--------- --------
TOTAL INTANGIBLE ASSETS 11,013.38 5,275.64
II. TANGIBLE ASSETS
1.OTHER ASSETS, OPERATING AND OFFICE
EQUIPMENT
660 Operating and office equipment 22,851.92 13,796.80
--------- --------
22,851.92 13,796.80
TOTAL TANGIBLE ASSETS 22,851.92 13,796.80
--------- --------
TOTAL FIXED ASSETS 33,865.30 19,072.44
B. CURRENT ASSETS
I RECEIVABLES AND OTHER ASSETS
1.RECEIVABLES AND OTHER ASSETS
2196 Services not yet invoiced 73,548.47 30,000.00
--------- --------
73,548.47 30,000.00
2. OTHER RECEIVABLES AND ASSETS
2391 Office deposit Salurnerstrasse 8,400.00 8,400.00
3550 Tax office 54.00 5,279.78
3560 Municipality 0.00 745.60
3700 Payroll account 0.00 420.90
--------- --------
8,454.00 14,846.28
--------- --------
TOTAL RECEIABLES 82,002.47 44,846.28
13
<PAGE>
II. CASH BALANCE, CHECKS, DEPOSITS WITH CREDIT INSTITUTIONS
1. DEPOSITS WITH CREDIT INSTITUTIONS
2801 TirolerSparkasse 03.301.392.373 50,181.77 30,201.30
--------- --------
50,181.77 30,201.30
--------- --------
50,181.77 30,201.30
--------- --------
132,184.24 75,047.58
C. DEFERRALS & ACCRUALS
2990 Active deferrals & accruals 9,000.00 12,000.00
--------- --------
9,000.00 12,000.00
--------- --------
TOTAL DEFERRALS & ACCRUALS 175,049.54 106,120.02
--------- --------
DETAILED LIABILITIES
12/31/2014 12/31/2013
EUR EUR
A NEGATIVE EQUITY
I SHARE CAPITAL
1 SHARE CAPITAL
9010 Share capital (35,000.00) (35,000.00)
--------- --------
(35,000.00) (35,000.00)
--------- --------
TOTAL SHARE CAPITAL (35,000.00) (35,000.00)
II NET LOSS
9390 Profit & loss carried forward 168,.98.27 32,088.02
9399 Annual profit 59,177.70 136,610.25
--------- --------
TOTAL NET PROFIT/LOSS 109,520.57 168,698.27
TOTAL SHAREHOLDERS' EQUITY 74,520.57 133,698.27
B PROVISIONS
1. TAX PROVISIONS
3020 Corporate tax (2,883.00) (937.00)
--------- --------
(2,883.00) (937.00)
14
<PAGE>
2. OTHER PROVISIONS
3044 Services not yet invoiced (11,192.13) (15,446.76)
3060 Consultancy and financial
statement costs (3,000.00) (2,000.00)
3090 Other provisions (30,100.00) 0.00
--------- --------
(44,292.13) (17,446.76)
--------- --------
TOTAL PROVISIONS (44,292.13) (17,446.76)
C LIABILITIES
1 ACCOUNTS PAYABLE TRADE
3300 Accounts payable trade - domestic (6,647.58) 16,900.54
3710 Various short-term liabilities (18,538.71) (1,101.82)
--------- --------
(25,186.29) (18,002.36)
2 OTHER LIABILITIES
FROM TAXES
3510 VAT (9,541.16) (212.17)
3520 Tax office wage deduction (L) (3,080.65) (720.00)
3521 Tax office wage deduction (DB) (1,252.66) 0.00
3522 Tax office wage deductions (DZ) (119.70) 0.00
3560 Municipality (835.10) 0.00
--------- --------
(14,829.27) (932.17)
OTHER LIABILITIES
3480 Other short-term liabilities to
the shareholders (91,500.00) (190,500.00)
3750 Various liabilities 1-5 (71,000.00) 0.00
3810 Payroll account Luca Pasquini 120.58 (12,000.00)
--------- --------
(162,379.42) (202.500.00)
TOTAL OTHER LIABILITIES (177,208.69) (203,432.17)
--------- --------
TOTAL LIABILITIES (202,394.98) (221,434.53)
--------- --------
TOTAL LIABILITIES (175,049.54) (106,120.02)
--------- --------
15
<PAGE>
DETAILED PROFIT & LOSS STATEMENT
for the fiscal year from 01/01/2015 to 12/31/2015
2015 2014
EUR EUR
1. REVENUES
a) Service revenue
4240 Domestic revenue - 20% 330,499.00 6,946.17
--------- --------
330,499.00 6,946.17
b) Service revenue
4240 Service revenue EU 389,783.51 308,700.00
--------- --------
389,783.51 308,700.00
--------- --------
TOTAL REVENUES 720,282.51 315.46.17
2 CHANGES TO FINISHED GOODS AND WORK IN PROGRESS
AND SERVICES NOT YET INVOICED
4560 Changes to services that are not
yet invoiced 0.00 -11.400.00
--------- --------
0.00 -11.400.00
3 OTHER OPERATING INCOME
a) Income from outflow and appreciation of
assets with the exception of financial assets
7820 Book value of depreciated assets (1,042.50) 0.00
--------- --------
(1,042.50) 0.00
--------- --------
TOTAL OTHER OPERATING INCOME (1,042.50) 0.00
4 COST OF MATERIALS AND OTHER MANUFACTURING COSTS
a) Cost of materials
5060 Cost of materials trade (1,261.70) 0.00
--------- --------
(1,261.70) 0.00
b) Expenses for services procured
5700 Sub-contract (262,898.00) (133,301.00)
--------- --------
(262,898.00) (133,301.00)
c) Cash discounts received
5800 Cash discounts received - 0% 4.81 0.00
5820 Cash discounts received - 20% 0.30 0.00
--------- --------
5.11 0.00
TOTAL MATERIAL COST (264,.154.59) (133,301.00)
16
<PAGE>
5 PERSONNEL EXPENSES
a) Wages
6200 Salaries (149,014.44) (149,052.41)
6210 Commissions (30,100.00) 0.00
6280 Managing director (52,500.00) (14,000.00)
6300 Other remunerations (24,835.74) (24,871.86)
6372 Per diem (73.60) (1,011.30)
6380 Mileage allowance and expenses (672.00) (1,799.28)
6470 Adjustment to the provision for
unutilized vacation entitlements 4,254.63 (9,841.54)
--------- --------
(252,941.15) (200,576.39)
--------- --------
(9,025.02) (3,628.52)
b) Expenses for severance payments
6401 BMVG [Works Constitution Act]
contributions (2,659.96) (2,598.94)
--------- --------
(2,659.96) (2,598.94)
c) Expenses for legally prescribed social
contributions as well as salary-dependent
expenses and mandatory contributions
6500 Legal social contributions 593.74 2,598.94
6550 Legal social contributions
for management (38,073.37) (40,364.94)
6600 Employer contribution (10,256.00) (8,345.86)
6601 Surcharge for employer contribution (980.01) (797.47)
6630 Community tax (6,837.28) (5,563.89)
--------- --------
(55,552.92) (52,473.22)
d) Other social contributions
6700 Voluntary social contributions (124.15) 0.00
--------- --------
(124.15) 0.00
TOTAL PERSONNEL EXPENSES (311,278.18) (255,648.55)
6 WRITE-OFFS
a) Depreciation on intangible assets
and activated expenses for business
expansion
7010 Depreciation on fixed assets (15,085.57) (6,431.72)
7070 Low-value assets (2,594.12) (2,593.30)
(17,679.69) (9,025.02)
--------- --------
(17,679.69) (9,025.02)
17
<PAGE>
7 OTHER OPERATING EXPENSES
a) Taxes and charges if they are not dependent
on income or revenues
7110 Stamp and legal fees 0.00 (689.00)
7171 Contributions for trade chambers and
professional associations (419.14) (200.00)
7172 Mandatory contribution to regional
government 0.00 (323.40)
7180 Other taxes and charges (52.00) 0.00
--------- --------
(471.14) (1,212.40)
b) Office expenses
7400 Rent (17,436.14) (17,390.09)
--------- --------
(17,436.14) (17,390.09)
c) Energy expenses
7241 Electricity (373.77) (440.00)
7250 Heating costs (438.84) (632.50)
--------- --------
(812.61) (1,072.50)
d) Maintenance
7211 Software maintenance (5,306.33) 0.00
--------- --------
(5,306.33) 0.00
e) Vehicle expenses
7207 Repair and maintenance for car pool (1,667.09) (36.00)
7330 Vehicle expenses - cars (fuel) (5,312.36) (1,613.13)
7701 Vehicle insurance (1,938.10) (81.65)
--------- --------
(8,917.55) (1,730.78)
f) Advertisement and similar expenses
7540 Third Party commissions 0.00 (1,680.00)
7651 Advertisements (42.40) (42.40)
7660 Similar expenses (128.11) 0.00
7665 Representation (461.54) 0.00
(632.05) (1,722.40)
g) Travel expenses
7340 Travel expenses (3,466.20) (1,522.41)
7341 Travel expenses for managing director (2,199.30) (4,306.81)
7342 Travel expenses for shareholders (677.42) (273.18)
7355 Parking and toll fees 0.00 (82.70)
--------- --------
(6,342.92) -6,185.10
18
<PAGE>
h) Communication expenses
7380 Telephone (3,536.14) (3,564.91)
--------- --------
(3,536.14) (3,564.91)
i) Office expenses
7600 Office material (248.27) (55.69)
--------- --------
(248.27) (55.69)
j) Rent and leasing expenses
7460 Car lease (8,893.97) (847.85)
--------- --------
(8,893.97) (847.85)
(4.00) 0.00
k) Other operating expenses
7480 Licensing fees 0.00 (72.30)
7750 Tax consultancy expenses (3,500.00) (3,157.00)
7755 Legal consultancy expenses (4,000.00) (892.00)
7760 Accounting and EDP costs (3,474.79) (3,399.05)
7790 Costs of monetary transactions (928.38) (263.67)
7802 Cent correction 0.44 (0.11)
--------- --------
(11,902.73) (7,784.13)
TOTAL OTHER OPERATING EXPENSES (64,499.85) (41,565.85)
8. OPERATING PROFIT 61,627.70 (135,294.25)
9. INTERESTS AND SIMILAR EXPENSES
8320 Interest on arrears and reminder fees (4.00) (4.00)
--------- --------
(4.00) (4.00)
(4.00) (4.00)
10 FINANCIAL INCOME (4.00) (4.00)
19
<PAGE>
11 INCOME FROM ORDINARY BUSINESS ACTIVITIES
61,623.70 (135,298.25)
12 INCOME AND REVENUE TAX
8500 Corporate tax (3,383.00) (1,437.00)
8501 Corporate tax for previous periods 937.00 125.00
--------- --------
(2,446.00) (1,312.00)
13 ANNUAL PROFIT (+)
ANNUAL (LOSS) (-) 59,177.70 (136,610.25)
14 ANNUAL PROFIT/(LOSS) 59,177.70 (136,610.25)
15 PROFIT CARRIED FORWARD
9390 Profit & Loss carried forward (168,698.27) (32,088.02)
16 Net profit
Net loss (109,520.57) (168.698.27)
20
<PAGE>
APPENDIX
of
Odissea Betriebsinformatik Beratung GmbH
Innsbruck
for the fiscal year
from 01/01/2015 to 12/31/2015
21
<PAGE>
Accounting and valuation methods
General principles
The annual financial statement was prepared based on the rules of UGB.
The annual financial statement was prepared based on generally accepted
accounting principles and in accordance with a general norm to provide a
truthful picture of assets, financial and income situation.
The principle of completeness was followed in preparing this financial
statement.
Individual valuation was used for the valuation of assets.
Furthermore, going concern principle was used for the valuation.
Principle of prudence was used so that only the profits as on the cut-off date
are shown. Identifiable risks and potential losses, which are applicable for the
fiscal year or earlier, were taken into consideration even if such circumstances
have come into force between the cut-off date and date when this financial
statement was prepared.
Receivables and liabilities in foreign currency were calculated with the foreign
exchange rate as on the reporting date, if there is any revaluation involved.
Amounts without currency information are EURO amounts.
Notes to the balance sheet
Assets
The trend of individual items of the assets and depreciation based on individual
items is presented in the asset analysis. All detailed evaluations (inflow and
outflow) are attached as enclosures to this report.
Intangible fixed assets
The intangible fixed assets are valued at procurement and manufacturing costs,
which are then reduced by planned depreciation.
Linear depreciation is used.
The service life for the individual items stated in the enclosed list of
appendices is used as a basis for planned depreciation.
Following service life is used for the planned depreciation:
Tangible assets
The tangible fixed assets are valued at procurement and manufacturing costs,
which are then reduced by planned depreciation.
Linear depreciation is used.
22
<PAGE>
Following service life is used for the planned depreciation:
Years Percent
Operating and office equipment 3 33.33
Low-value assets
Benefit in accordance with Article 13 of EStG [Income Tax Act] is used for
low-value assets amounting to EUR 2,594.12.
A valuation reserve in accordance with Article 13 of EStG is not used as it is
not significant in this instance.
Reserves
Reporting of negative cash flow
There is no excessive debt in sense of any insolvency, because the shareholders
have given their binding declarations that they have secured financing for the
company and the existing debt is sufficiently covered by the receivables, which
amount to EUR 91,500 on the reporting date.
Provisions
Status 01.01 Inflow Outflow Status 12.31
EUR EUR EUR EUR
Provision for corporate tax 937.00 2,883.00 937.00 2,883.00
Provision of unutilized
vacation entitlement 15,446.76 0.00 4,254.63 11,192.13
Provision for accounting work 2,000.00 3,000.00 2,000.00 3,000.00
Other provisions 0.00 30,100.00 0.00 30,100.00
--------- --------- --------- ---------
Total 18,383.76 35.983.00 7,191.63 47,175.13
Breakdown of liabilities
Liabilities are estimated with their repayment amount.
> 5 years > 1 year
Total amount of liabilities
with residual duration 0.00 162,500.00
Other information
Members of the Board of Directors
Following person(s) is/are appointed as managing director(s):
Annamaria Iva Ornella Ferraresi
23
<PAGE>
Number of employees
The average number of employees during the fiscal year, categorized into
employees and managers:
Fiscal year
Employees 0
Managers 5
-------
Total 5
Annual financial statement signed by the managing director
/s/ Luca Pasquini /s/ Annamaria Iva Ornella Ferraresi
----------------- ------------------------------------
Luca Pasquini Annamaria Iva Ornella Ferraresi
Signature Inzing 08/10/2016
24
<PAGE>
ENCLOSURES TO THE APPENDIX
25
<PAGE>
NOTES TO THE BALANCE SHEET
2900 Active accruals & deferrals
Leasing payment Toyota RAV 4 12,000.00
Cancellation of advance lease payment Toyota RAV 4 (3,000.27)
-------
9000.00
3090 Other provisions
Provisions Employee premiums 2015 (30,100.00)
-------
(30,100.00)
3510 VAT calculation
U 11/2015 (3,369.03)
U 12/2015 (6,172.13)
-------
(9,541.16)
3710 Other short-term liabilities
IKG 12/2015 (40.00)
Tigas 12/2015 (45.83)
A1 Telecom 12/2015 (148.14)
Hutchison Drei Telekom 12/2015 (16.67)
WT Gruber BH + LV 12/2015 (288.07)
Engange IT Services 12/2015 (18,000.00)
-------
(18,538.71)
26
<PAGE>
ASSET ANALYSIS
<TABLE>
Account Procurement Inflow Outflow Rebooking Procurement Appreciation
description value value
<S> <c> <c> <c> <c> <c> <c>
Intangible assets
110 Patent and license rights 8,686.86 0.00 0.00 0.00 8,686.86 0.00
120 Data processing 0.00 10,950.00 0.00 0.00 10,950.00 0.00
INTANGIBLE ASSETS 8,686.86 10,950.00 0.00 0.00 19,636.86 0.00
TANGIBLE ASSETS
660 Operating and
business equipment 18,854.94 19,970.93 1,390.00 0.00 37,435.87 0.00
TANGIBLE ASSETS 18,854.94 19,970.93 1,390.00 0.00 37,435.87 0.00
TOTAL 27,541.80 30,920.93 1,390.00 0.00 57,072.73 0.00
</TABLE>
<TABLE>
Account Depreciation Book value Book value Total
description 01/01/2015 12/31/2015 Depreciation
<S> <c> <c> <c> <c>
Intangible assets 2,895.62 5,275.64 2,380.02 6,306.84
110 Patent and license rights 2,316.64 0.00 8,633.36 2,316.64
120 Data processing 5,212.26 5,275.64 11,013.38 8,623.48
INTANGIBLE ASSETS
TANGIBLE ASSETS 9,873.31 13,796.80 22,851.92 14,583.95
660 Operating and
business equipment 9,873.31 13,796.80 22,851.92 14,583.95
TANGIBLE ASSETS 15,085.57 19,072.44 33,865.30 23,207.43
TOTAL
</TABLE>
27
<PAGE>
DETAILED ASSET ANALYSIS
<TABLE>
Inv Description Procurement Procurement value ND Inflow Outflow Rebooking
Date 01/01/2015
<S> <c> <c> <c> <c> <c> <c>
110 Patent and license rights
1-1 Red gate SQL Source Control 07/19/2013 956.25 3 0.00 0.00 0.00
1-2 Red gate SQL Developer Bundle 07/19/2013 1,228.25 3 0.00 0.00 0.00
1-3 Red gate .NET Tool belt 07/19/2013 1,483.25 3 0.00 0.00 0.00
2-0 Teamviewer 8 Corporate 10/09/2013 1.990.00 3 0.00 0.00 0.00
3-0 Server license 06/30/2014 465.00 3 0.00 0.00 0.00
4-0 Licenses 08/2014 - 09/2017 08/08/2014 2,564.11 3 0.00 0.00 0.00
-----------------------------------------------------------------------------------
8,686.86 0.00 0.00 0.00
Patent and license rights
120 Data processing programs
1-0 PRTG 1000 Network Monitor 03/16/2015 0.00 3 2,000.00 0.00 0.00
2-0 PRTG 1000 Network Monitor
upgrade unlimited 09/02/2015 0.00 3 8,000.00 0.00 0.00
3-0 Octopus SW Development Tool 04/30/2015 0.00 3 950.00 0.00 0.00
-----------------------------------------------------------------------------------
Data processing programs 0.00 10,950.00 0.00 0.00
660 Operating and office equipment
1-0 Toshiba Botebook Tecra R950-19E 07/26/2013 885.00 3 0.00 0.00 0.00
2-0 Toshiba Botebook Tecra R950-19E 07/26/2013 885.00 3 0.00 0.00 0.00
3-0 5Stk. Toshiba Docking station 07/26/2013 600.00 3 0.00 0.00 0.00
4-0 8Stk. Samsung Monitor LED 21.5" 07/26/2013 894.00 3 0.00 0.00 0.00
5-0 Toshiba Tecra R950-19E+Asus PC 07/31/2013 1,265.00 3 0.00 0.00 0.00
6-0 Toshiba Tecra R950-19E+ Monitor 08/30/2013 1,302.34 3 0.00 0.00 0.00
7-0 Scanner 10/31/2013 737.00 3 0.00 0.00 0.00
8-0 Toshiba Botebook Tecra R930-15C 02/28/2014 1,090.00 4 0.00 0.00 0.00
9-0 Toshiba Botebook Tecra R930-15C 02/28/2014 1,090.00 4 0.00 0.00 0.00
10-0 HP Elitebook 840 08/06/2014 960.00 4 0.00 0.00 0.00
11-0 TECRA Z40-A-11W C15-4300U 08/15/2014 1,390.00 4 0.00 1,390.00 0.00
12-0 Cabinet Galant 09/18/2014 457.00 10 0.00 0.00 0.00
13-0 HP server 491315-421 incl.
hard discs 11/28/2014 4,402.00 4 0.00 0.00 0.00
14-0 PC 800 G1TWR plus accessories 11/29/2014 2,897.00 4 0.00 0.00 0.00
15-0 3 PC`s PC 800 G1TWR Ci7/4770
plus accessories 01/13/2015 0.00 3 4,237.71 0.00 0.00
17-0 Notebook ASUS X555LA 03/03/2015 0.00 3 405.90 0.00 0.00
18-0 Apple Iphone 5S 03/20/2015 0.00 3 499.17 0.00 0.00
19-0 PC 800 G1TWR plus Monitor 04/24/2015 0.00 3 1,424.40 0.00 0.00
-----------------------------------------------------------------------------------
Operating and office equipment 6,568.34 12,286.60 0.00 0.00
20-0 Notebook Toshiba Satelite
incl. accessories 06/19/2015 0.00 3 1,570.74 0.00 0.00
21-0 PC ASUS D310MT 06/23/2015 0.00 3 1,018.60 0.00 0.00
22-0 Olympus TG-4 Black incl
accessories 07/09/2015 0.00 3 424.15 0.00 0.00
</TABLE>
28
<PAGE>
<TABLE>
Inv Description Procurement Procurement value ND Inflow Outflow Rebooking
Date 01/01/2015
<S> <c> <c> <c> <c> <c> <c>
23-0 Dell Server Poweredge M630 09/25/2015 0.00 3 7,200.00 0.00 0.00
24-0 PC 800 G1 TWR incl accessories 11/11/2015 0.00 3 2,733.60 0.00 0.00
25-0 Appile IPhone 5S 16GB 11/30/2015 0.00 3 416.66 0.00 0.00
-----------------------------------------------------------------------------------
Operating and office equipment 18,854.94 19,970.93 1,390.00 0.00
Total 27,541.80 30,920.93 1,390.00 0.00
</TABLE>
DETAILED ASSET ANALYSIS
<TABLE>
Inv Description Procurement value Appreciation Depreciation Book value Book value Total
12/31/2014 01/01/2015 12/31/2015 Depreciation
<S> <c> <c> <c> <c> <c> <c>
110 Patent and license rights
1-1 Red gate SQL Source Control 956.25 0.00 318.75 478.13 159.38 796.87
1-2 Red gate SQL Developer Bundle 1,228.25 0.00 409.42 614.13 204.71 1,023.54
1-3 Red gate .NET Tool belt 1,483.25 0.00 494.42 741.63 247.21 1,236.04
2-0 Teamviewer 8 Corporate 1.990.00 0.00 663.33 995.00 331.67 1,658.33
3-0 Server license 465.00 0.00 155.00 310.00 155.00 310.00
4-0 Licenses 08/2014 - 09/2017 2,564.11 0.00 854.70 2,136.75 1,282.05 1,282.06
-----------------------------------------------------------------------------------------------
8,686.86 0.00 2,895.62 5,275.64 2,380.02 6,306.84
Patent and license rights
120 Data processing programs
1-0 PRTG 1000 Network Monitor 2,000.00 0.00 666.66 0.00 1,333.34 666.66
2-0 PRTG 1000 Network Monitor
upgrade unlimited 8,000.00 0.00 1,333.32 0.00 6,666.68 1,333.32
3-0 Octopus SW Development Tool 950.00 0.00 316.66 0.00 633.34 316.66
-----------------------------------------------------------------------------------------------
Data processing programs 10,950.00 0.00 2,316.64 0.00 8,633.36 2,316.64
660 Operating and office equipment
1-0 Toshiba Botebook Tecra R950-19E 885.00 0.00 295.00 442.50 147.50 737.50
2-0 Toshiba Botebook Tecra R950-19E 885.00 0.00 295.00 442.50 147.50 737.50
3-0 5Stk. Toshiba Docking station 600.00 0.00 200.00 300.00 100.00 500.00
4-0 8Stk. Samsung Monitor LED 21.5" 894.00 0.00 298.00 447.00 149.00 745.00
5-0 Toshiba Tecra R950-19E+Asus PC 1,265.00 0.00 421.67 632.51 210.84 1,054.16
6-0 Toshiba Tecra R950-19E+ Monitor 1,302.34 0.00 434.11 651.17 217.06 1,085.28
7-0 Scanner 737.00 0.00 245.67 368.51 122.84 614.16
8-0 Toshiba Botebook Tecra R930-15C 1,090.00 0.00 272.50 817.50 545.00 545.00
9-0 Toshiba Botebook Tecra R930-15C 1,090.00 0.00 272.50 817.50 545.00 545.00
10-0 HP Elitebook 840 960.00 0.00 240.00 840.00 600.00 360.00
</TABLE>
29
<PAGE>
<TABLE>
Inv Description Procurement value Appreciation Depreciation Book value Book value Total
12/31/2014 01/01/2015 12/31/2015 Depreciation
<S> <c> <c> <c> <c> <c> <c>
11-0 TECRA Z40-A-11W C15-4300U 0.00 0.00 173.75 1,216.25 0.00 0.00
12-0 Cabinet Galant 457.00 0.00 45.75 434.63 388.88 68.62
13-0 HP server 491315-421 incl.
hard discs 4,402.00 0.00 1,100.50 3,851.75 2,751.25 1,650.75
14-0 PC 800 G1TWR plus accessories 2,897.10 0.00 724.28 2,534.98 1,810.70 1,086.40
15-0 3 PC`s PC 800 G1TWR Ci7/4770
plus accessories 4,237.71 0.00 1,412.57 0.00 2,825.14 1,412.57
17-0 Notebook ASUS X555LA 405.90 0.00 135.30 0.00 270.60 135.30
18-0 Apple Iphone 5S 499.17 0.00 166.39 0.00 332.78 166.39
19-0 PC 800 G1TWR plus Monitor 1,424.40 0.00 474.80 0.00 949.60 474.80
-----------------------------------------------------------------------------------------------
Operating and office equipment 27,541.80 0.00 3,963.44 5,473.64 13,796.80 5,058.14
20-0 Notebook Toshiba Satelite incl.
accessories 1,570.74 0.00 523.58 0.00 1,047.16 532.58
21-0 PC ASUS D310MT 1,018.60 0.00 339.54 0.00 679.06 339.54
22-0 Olympus TG-4 Black incl accessories 424.15 0.00 70.70 0.00 353.45 70.70
23-0 Dell Server Poweredge M630 7,200.00 0.00 1,200.00 0.00 6,000.00 1,200.00
24-0 PC 800 G1 TWR incl accessories 2,733.60 0.00 462.27 0.00 2,311.33 462.27
25-0 Appile IPhone 5S 16GB 416.66 0.00 69.43 0.00 347.23 69.43
-----------------------------------------------------------------------------------------------
Operating and office equipment 37,435.87 0.00 9,873.31 13,796.80 22,851.92 14,583.95
57,072.73 0.00 15,085.57 19,072.44 33,865.30 23,207.43
</TABLE>
30
<PAGE>
ASSET ADDITIONS
<TABLE>
Account Inventory Description Procurement Commission. Procurement ND Depreciation Inv. 12-
Date Date Value Basis Amount Surcharge
<S> <c> <c> <c> <c> <c> <c> <c> <c> <c>
120 1-0 PRTH 1000 Network Monitor 03/16/2015 03/16/2015 2,000.00 3 2,000.00 0.00 0.00
120 2-0 PRTH 1000 Network Monitor
upgrade unlimited 09/02/2015 09/02/2015 8,000.00 3 8,000.00 0.00 0.00
120 3-0 Octopus SW Development Tool 04/30/2015 03/30/2015 950.00 3 950.00 0.00 0.00
-------------------------------------------------------------------------------
Patent and license rights 10,950.00 10,950.00 0.00 0.00
660 15-0 3 PC`s PC 800 G1TWR Ci7/4770
plus accessories 01/13/2015 01/13/2015 4,237.71 2 4,237.71 0.00 0.00
660 17-1 Notebook ASUS X555LA 03/03/2015 03/03/2015 405.90 3 405.90 0.00 0.00
660 18-0 Apple IPhone 5S 03/20/2015 03/20/2015 499.17 3 499.71 0.00 0.00
660 19-0 PC 800 G1TWR plus Monitor 04/24/2015 04/24/2015 1,424.40 3 1,424.40 0.00 0.00
660 20-0 Notebook Toshiba Satelite
incl. accessories 06/19/2015 06/19/2015 1,570.74 3 1,570.74 0.00 0.00
660 21-0 PC ASUS D310MT 06/23/2015 06/23/2015 1,018.60 3 1,018.60 0.00 0.00
660 22-0 Olympus TG - 4 Black incl.
accessories 07/09/2015 07/09/2015 424.15 3 424.15 0.00 0.00
660 23-0 Dell Server Poweredge 360 09/25/2015 09/25/2015 7,200.00 3 7,200.00 0.00 0.00
660 24-0 PC 800 G1 TWR incl.
accessories 11/11/2015 11/11/2015 2,773.60 3 2,773.60 0.00 0.00
660 25-0 Apple IPhone 5S 16 GB 11/30/2015 11/30/2015 416.66 3 416.66 0.00 0.00
-------------------------------------------------------------------------------
Operating and office equipment 19,970.93 19,970.93 0.00 0.00
-------------------------------------------------------------------------------
Total 30,920.93 30,920.93 0.00 0.00
</TABLE>
ASSET ADDITIONS
<TABLE>
Account Inventory Description Procurement Outflow Outflow Book value Outflow Book value Income
Date Date amount AW At the start amount AW At the end
<S> <c> <c> <c> <c> <c> <c> <c> <c> <c>
660 11-0 TECRA Z40-A11W
C15-43 U 15/09/2014 25/03/2015 1,390.00 1,216.25 1,0420.50 0.00 1,064.00
--------------------------------------------------------------------------------------------
Operating and office equipment 1,390.00 1,216.25 1,0420.50 0.00 1,064.00
--------------------------------------------------------------------------------------------
Total 1,390.00 1,216.25 1,0420.50 0.00 1,064.00
</TABLE>
31
<PAGE>
DEPRECIATION FORECAST
<TABLE>
Account Description FY2015 FY2015 FY2017 FY2018 FY2019 FY2020
<S> <c> <c> <c> <c> <c> <c> <c>
110 Patent and license rights 2,895.62 1,952.32 427.28 0.00 0.00 0.00
120 Data 2,316.64 3,650.01 3,649.87 1,333.27 0.00 0.00
660 Operating and office equipment 9,873.31 10,406.75 9,311.94 2,880.6 45.75 45.75
-----------------------------------------------------------------
Total 15,085.57 16,009.08 13,389.09 4,213.33 45.75 45.75
</TABLE>
32
<PAGE>
Cash flow statement
Liquid funds 12/31/2015 01/01/2015
EUR EUR
2801 Tispa 03.301.392.373 50,182 30,201
-------- --------
Total liquid funds 50,182 30,201
--------
Changes to liquid funds: 19,980
Profit acc. to P&L statement 59,178
Plus:
Expenses not related to cash:
Write-offs 15,086
Write-offs on financial assets -
Minus:
Income not related to cash: -
Changes to net current assets
Changes to stock -
Changes to services not yet invoiced 43,548
Changes to customer payments -
Changes to receivables from subsidiaries -
Changes to other receivables 6,392
Changes to ARAP 3,000
Changes to trade payables 10,253
Changes to provisions 28,791
Changes to other liabilities, cleaning accounts 31,334 15,716
---------------------
1. Net cash flow from ongoing business activities 89,979
Investments 30,921
Book value fixed assets 1,043
2. Net cash flow from investment activities 29,878
Loan: -
Change (load repayment) 40,121
Change current account (liabilities) -
Dividends -
---------------------
3. Net cash flow from financing activities 40,121
---------------------
Cash Flow (= changes liquid funds = total from 1.-3.) 19,980
---------------------
33
<PAGE>
Evidence account in accordance with Article 4 (12) of EStG
<TABLE>
Accounts acc.
to financial
statement 01/01/2015 Inflow Outflow Rebooking 12/31/2015
EUR EUR EUR EUR EUR EUR
<S> <c> <c> <c> <c> <c> <c>
External financing:
Nominal capital 35,000.00 - 35,000.00 35,000.00
Capital reserves
Retained earnings
Net profit
------------------------------------------------------------------------------
Total 35,000.00 - 35,000.00 35,000.00
Internal financing:
Net profit 109,520.57 168,698.27 59,177.70 109,520.57
------------------------------------------------------------------------------
Total 109,520.57 168,698.27 59,177.70 109,520.57
------------------------------------------------------------------------------
Total share capital 109,520.57 168,698.27 59,177.70 109,520.57
</TABLE>
34
<PAGE>
Tax calculation EUR
Annual profit acc. to P&L statement 59.177.70
Additions
Corporate tax 3,383.00
Corporate tax previous periods 937.00
Active items PKW 25.00
50% Representation allowance -
Capital gains tax - 4,946.00
Deductions
Assessment basis corporate tax 64,123.70
Corporate tax calculation
Annual profit acc. to tax calculation 64,123.70
Loss carried forward (max. 75%) -
Taxable profit 16,030.92
Calculation
Profit x 25 % 4,007.73
Minimum corporate tax 2015 500.00
Minus advance payments
Corporate tax advance payment 500.00
Abeyance tax 625.00
Capital gains tax - 1,125.00
Rounding 0.27
Corporate tax payment 2015 2,883.00
35
<PAGE>
VAT calculation EUR
20%
4020 Domestic revenue 310.499.00
----------
Total 310.499.00
==========
Total 310.499.00
Plus own consumption -
Para. 19 (1a) (building services)
Minus exports -
Minus ig deliveries -
----------
Taxable services, deliveries and
own consumption 310.499.00
==========
Taxable :
with 20% normal tax rate 310.499.00 20% 62,099.80
with 10% reduced tax rate - 10% -
Tax liability acc. to Para. 19/1/2 and
Art.19/1/3/ Art.25/5 39,472.67
Intra-community acquisitions -
Total of assessment basis 23,097.12
Tax-free acc. to Art 6 (2) 50.00
----------
23,047.12
==========
Taxable:
with 20% normal tax rate 23,047.12 20% 4,609.42
with 10% reduced tax rate - 10%
----------
Total VAT and income tax 29,112.51
Total amount of pre-tax 7,458.06
Import VAT -
Pre-tax from intra-community
acquisitions 4,609.42
Pre-tax Par 19/1/2 and Art.19/1/3/
Art.25/5 39,472.67
----------
Total pre-tax to be deducted 51,540.15 51,540.15
Advance payment / surplus 54,641.74
Advance payments made 54,641.74
-----------
VAT liability for 2015 -
===========
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>3
<FILENAME>emgl160907-ex992_odissea.txt
<DESCRIPTION>UNAUDITED INTERIM FINANCIAL STATEMENTS
<TEXT>
EXHIBIT 99.2
Chartered Public Accountants Gruber
Steuerberatungs GmbH
Interim financial statement as of
06/30/2016
Odissea Betriebsinformatik Beratung GmbH
Salurner Strasse 12, 6020 Innsbruck
<PAGE>
TABLE OF CONTENTS
1 Review contract and performance engagement 3
2 Reviewer's Report 3
3 Balance sheet as of 06/30/2016 compared to
previous year 12/31/2015 5
4 Profit & Loss statement as of 06/01/2016 compared to
previous year 01/06/2015 8
5 Cash flow statement 13
6 Evidence account acc. to Article 4 (12) EStG [Income Tax Act] 14
7 Asset analysis 15
<PAGE>
To the
Members of Management of
Odissea Betriebsinformatik Beratung GmbH,
Luca Pasquini and Gabriele Peroni
Salurner StraBe 12, Innsbruck
We have completed the audit of the financial statements as of 31.12.2015 of
Odissea Betriebsinformatik Beratung GmbH,
Innsbruck,
(referred to as "the Company")
and provide the results of our audit in the following report:
1. Review contract and performance of the engagement
By management resolution of Odissea Betriebsinformatik Beratung GmbH, Innsbruck,
we were elected as reviewer for the voluntary review of fiscal year 2016. The
Company, represented by the management board, concluded an review contract with
us to review the financial statements as of 30.06.2016, including the accounting
system pursuant to Sections 269 et seqq. UGB.
The Company is a small corporation pursuant to Section 221 UGB.
The review is a voluntary review.
We performed the review, with interruptions in August 2016 mainly at the our
office in Innsbruck. The review was substantially completed at the date of this
report.
Our review is based on the review contract concluded with the Company. The
"General Conditions of Contract issued by the Austrian Chamber of Public
Accountants and Tax Advisors" (refer to Appendix VII) form an integral part of
the review contract. These conditions of contract do not only apply to the
Company and the reviewer, but also to third parties. Section 275 UGB applies
with regard to our responsibility and liability as reviewers towards the Company
and towards third parties.
1.1. Information provided
The Company's legal representatives provided all evidence and explanations
requested by us. We obtained a representation letter signed by the legal
representatives which we included in our working papers.
2. Reviewer's Report
Report on the unaudited Financial Statements
We have reviewed the accompanying financial statements of Odissea
Betriebsinformatik Beratung GmbH, Innsbruck, for the period from 1.1.2016 to
30.06.2016. These financial statements comprise the unaudited statement of
financial position as of 30.06.2016, the unaudited income statement for the
period 01.01.2016 to 30.06.2016, the unaudited Cash - Flow Statement for the
3
<PAGE>
period from 1.1.2016 to 30.06.2016, the unaudited Changes in Equity for the
period from 1.1.2016 to 30.06.2016 and the unaudited Analysis of Changes in
Fixed Assets for the period from 1.1.2016 to 30.06.2016.
Management's Responsibility for the Financial Statements
The Company's management is responsible for the preparation and fair
presentation of these financial statements in accordance with Austrian
Generally Accepted Accounting Principles (UGB) and for such internal
control as management determines is necessary to enable the preparation
of financial statements that are free from material misstatement,
whether due to fraud or error.
Reviewers' Responsibility
Our responsibility and liability as reviewer is guided by the General
Conditions of Contract issued by the Austrian Chamber of Public
Accountants and Tax Advisors towards the Company and towards third
parties.
We conducted our review in accordance expert opinion KFS/PG11 "Fachgutachten des
Fachsenats fUr Unternehmensrecht und Revision des Instituts fUr
Betriebswirtschaft, Steuerrecht und Organisation der Kammer der
Wirtschaftstreuhander Grundsatze fUr die prUferische Durchsicht von
AbschlUssen".
A review of interim financial information consists principally of applying
analytical procedures and making inquiries of persons responsible for financial
and accounting matters. It is substantially less in scope than an audit
conducted in accordance with the international standards on auditing (ISA), the
objective of which is the expression of an opinion regarding the financial
statement taken as a whole. Accordingly, we don't express such an opinion.
Based on our reviews, we are not aware of any material modifications that should
be mad to the financial statements referred to above for them to be in
conformity with Austrian Generally Accepted Accounting Principles (UGB).
Innsbruck, on 11th August 2016
Stauder Schuchter Kempf
WirtschaftsprUfungs - und Steuerberatungs GmbH
/s/ Mag. Wilfried Stauder
Mag. Wilfried Stauder
Austrian Certified Public Accountant
4
<PAGE>
Odissea Betriebsinfomatik Beratung GmbH
Innsbruck, Salurnerstrasse 12
Balance sheet as of June 30, 2016
06/30/2016 12/31/2015
A FIXED ASSETS
I INTANGIBLE ASSETS
I Concessions, industrial rights and
similar rights and values and
resulting licenses
110 Patent and license rights 1,403.86 2,308.02
120 Data processing 6,808.35 8,633.36
--------- ---------
8,212.21 11,013.38
--------- ---------
TOTAL INTANGIBLE ASSETS 8,212.21 11,013.38
II TANGIBLE ASSETS
OTHER ASSETS, OPERATING AND OFFICE
EQUIPMENT
660 Operating and office equipment 19,319.30 22,851.92
19,319.30 22,851.92
--------- ---------
TOTAL TANGIBLE ASSETS 19,319.30 22,851.92
TOTAL FIXED ASSETS 27,531.51 33,865.30
--------- ---------
B CURRENT ASSETS
I IRECEIVABLES AND OTHER ASSETS
1 RECEIVABLES AND OTHER ASSETS
2150 Trade receivables - overseas 21,390.00 0.00
2196 Services not yet invoiced 95,348.84 73,548.47
116,738.84 73.548.47
--------- ---------
2 OTHER RECEIVABLES AND ASSETS
2391 Office deposit Salurnerstrasse 8,400.00 8,400.00
3510 VAT 272.37 0.00
3550 Tax office 569.42 54.00
9,241.79 8,454.00
--------- ---------
TOTAL RECEIABLES 125,980.63 82,002.47
--------- ---------
5
<PAGE>
II CASH BALANCE, CHECKS, DEPOSITS WITH CREDIT INSTITUTIONS
1 DEPOSITS WITH CREDIT INSTITUTIONS
2801 TirolerSparkasse 03.301.392.373 55,686.82 50,181.77
55,686.82 50,181.77
--------- ---------
TOTAL CASH 55,686.82 50,181.77
--------- ---------
TOTAL CURRENT ASSETS 181,667.45 132,184.24
--------- ---------
C DEFERRALS & ACCRUALS
2900 Active deferrals & accruals 7,500.00 9,000.00
TOTAL ACCRUALS & DEFERRALS 7,500.00 9,000.00
--------- ---------
TOTAL DEFERRALS & ACCRUALS 216,698.96 175,049.54
--------- ---------
06/30/2016 12/31/2015
A SHAREHOLDERS' EQUITY / NEGATIVE EQUITY
I SHARE CAPITAL
1 SHARE CAPITAL
9010 Share capital (35,000.00) (35,000.00)
(35,000.00) (35,000.00)
--------- ---------
TOTAL SHARE CAPITAL (35,000.00) (35,000.00)
II NET LOSS
9390 Profit & Loss carried forward 109,520.57 168,698.27
9399 Annual profit (97,173.73) (59,177.70)
TOTAL NET PROFIT / LOSS 12,346.84 109,520.57
--------- ---------
TOTAL SHAREHOLDERS' EQUITY (22,653.16) 74.520.57
--------- ---------
B PROVISIONS
1 TAX PROVISIONS
3020 Corporate tax (9,195.00) (2,883.00)
--------- ---------
(9,195.00) (2,883.00)
2 OTHER PROVISIONS
3044 Services not yet invoiced (25,851.28) (11,192.13)
3060 Consultancy and financial
statement costs (5,250.00) (3,000.00)
3090 Other provisions (28,066.67) (30,100.00)
(59,167.95) (44,292.13)
--------- ---------
TOTAL PROVISIONS (68,362.95) (47,175.13)
--------- ---------
6
<PAGE>
C LIABILITIES
1 ACCOUNTS PAYABLE TRADE
3300 Accounts payable trade - domestic (5,426.71) (6,647.58)
3710 Various short-term liabilities (33,485.17) (18,538.71)
--------- ---------
(38,911.88) (25,186.29)
2 OTHER LIABILITIES
FROM TAXES
3510 VAT 0.00 (9,541.16)
3520 Tax office wage deduction (L) (3,626.14) (3,080.65)
3521 Tax office wage deduction (DB) (1,737.58) (1,252.66)
3522 Tax office wage deductions (DZ) (166.04) (119.70)
3560 Municipality (1,158.39) (835.10)
--------- ---------
(6,688.15) (14,829.27)
OTHER LIABILITIES
3600 Health insurance (14,147.36) 0.00
--------- ---------
(14,147.36) 0.00
OTHER LIABILITIES
3480 Other short-term liabilities to
the shareholders 0.00 (91,500.00)
3700 Payroll account (14,000.00) 0.00
3750 Various liabilities 1-5 (51,000.00) (71,000.00)
3810 Payroll account Luca Pasquini (935.46) 120.58
--------- ---------
(65.935.46) (162,379.42)
TOTAL OTHER LIABILITIES (86,770.97) (177,208.69)
--------- ---------
TOTAL LIABILITIES (125,682.85) (202,394.98)
--------- ---------
TOTAL LIABILITIES (216,698.96) (175,049.54)
--------- ---------
7
<PAGE>
PROFIT & LOSS STATEMENT AS OF JUNE 30, 2016
06/01/2016 12/31/2015
1 REVENUES
a) Service revenue
4020 Domestic revenue - 20% 96,380.00 62,339.00
4060 Non-taxable revenue 5,250.00 0.00
--------- ---------
101,630.00 62,339.00
b) Service revenue
4240 Service revenue EU 504,149.18 226,104.70
--------- ---------
504,149.18 226,104.70
--------- ---------
TOTAL REVENUES 605,779.18 288,443.70
--------- ---------
2 COST OF MATERIALS AND OTHER MANUFACTURING COSTS
a) Cost of materials
5064 Cost of materials trade EU (25,002.00) 0.00
--------- ---------
(25,002.00) 0.00
b) Expenses for services procured
5700 Sub-contract (181,002.24) (65,515.00)
--------- ---------
(181,002.24) (65,515.00)
c) Cash discounts
5820 Cash discounts - 20% 0.00 0.30
0.00 0.30
--------- ---------
TOTAL COST OF MATERIALS (206,004.24) (65,514.70)
--------- ---------
3 PERSONNEL EXPENSES
a) Wages
6020 Wages (101,281.83) (75,353.76)
6210 Commissions 10,033.33 0.00
6280 Managing director (35,000.00) (21,000.00)
6300 Other remunerations (17,076.35) (12,558.96)
6470 Adjustment to the provision for
unutilized vacation entitlements (14,659.15) 0.00
--------- ---------
(157.984.00) (108,912.72)
b) Expenses for severance payments
6401 BMVG [ Works Constitution Act]
contributions (1,658.08) (751.35)
--------- ---------
(1,658.08) (751.35)
c) Expenses for legally prescribed social contributions
as well as salary-dependent expenses and mandatory contributions
8
<PAGE>
6500 Legal social contributions (23,424.25) (19,546.47)
6600 Employer contribution (6,113.62) (4,901.09)
6601 Surcharge for employer contribution (584.19) (468.32)
6630 Community tax (4,075.75) (28,183.25)
--------- ---------
(34,197.81) (28,183.25)
d) Other social contributions
6700 Voluntary social contributions (183.36) 0.00
(183.36) 0.00
--------- ---------
TOTAL PERSONNEL EXPENSES (194,023.25) (137,847.32)
--------- ---------
4 WRITE-OFFS
a) Depreciation on intangible assets
and activated expenses for business
expansion
7010 Depreciation on fixed assets (8,338.71) 0.00
7070 Low-value assets (742.70) (1,565.53)
(9,081.41) (1,565.53)
--------- ---------
(9,081.41) (1,565.53)
--------- ---------
5 OTHER OPERATING EXPENSES
a) Taxes and charges if they are not dependent on income or
revenues
7170 Contributions 0.00 (200.00)
7171 Contributions for trade chambers
and professional associations (308.36 0.00
7172 Mandatory contribution to regional
government (323.40 (323.40)
7180 Other taxes and charges (238.40 0.00
--------- ---------
(870.16 (523.40)
b) Office expenses
7400 Rent (8,850.00 (8,586.14)
--------- ---------
(8,850.00 (8,586.14)
c) Energy expenses
7241 Electricity (375.66) (136.27)
7250 Heating costs (311.13) (175.53)
--------- ---------
(686.79) (311.80)
d) Maintenance
7204 Repair and maintenance of operating
and office equipment (68.30) 0.00
7211 Software maintenance (1,820.00) 0.00
--------- ---------
(1,888.30) 0.00
9
<PAGE>
e) Vehicle expenses
7207 Repair and maintenance for car pool 23.37 (373.86)
7330 Vehicle expenses - cars (fuel) (2,741.44) (2,940.67)
7701 Vehicle insurance (982.14) (1,052.85)
--------- ---------
3,700.21 (4,367.38)
f) Advertisement and similar expenses
7651 Advertisements (108.80) 0.00
7665 Representation 0.00 (258.88)
7680 Decoration material (90.18) 0.00
--------- ---------
(198.98) (258.88)
g) Travel expenses
7340 Travel expenses (204.15) (862.35)
7341 Travel expenses for managing
director (2,116.95) (519.00)
7342 Travel expenses for shareholders 0.00 (677.42)
--------- ---------
(2,321.10) (2,058.77)
h) Communication expenses
7380 Telephone (1,753.12) (2,107.98)
7381 Fax fees (2,631.70) 0.00
--------- ---------
(4,384.82) (2,107.98)
i) Rent and leasing expenses
7460 Car lease (4,621.17) (3,507.47)
--------- ---------
(4,621.17) (3,507.47)
k) Other operating expenses
7750 Tax consultancy expenses (10,250.00) 0.00
7755 Legal consultancy expenses (1,544.38) 0.00
7759 Other consultancy (50,766.17) 0.00
7760 Accounting and EDP costs (1,903.60) (1,761.00)
7790 Costs of monetary transactions (690.55) (289.67)
7802 Cent correction 0.00 (0.09)
--------- ---------
(65,154.70) (2,050.76)
--------- ---------
(92,934.55) (23,799.58)
--------- ---------
6 NET OPERATING INCOME 103,735.73 59,716.57
7 INCOME BEFORE TAXES 103,735.73 59,716.57
8 INCOME TAXES
8500 Corporate tax (6,562.00) (250.00)
--------- ---------
(6,562.00) (250.00)
9 NET INCOME 97,173.73 59,466.57
10 NET INCOME/ (LOSS) FOR THE YEAR 97,173.73 59,466.57
10
<PAGE>
11 ACCUMULATED (DEFICIT), BEGINNING
9390 Profit & Loss carried forward (109,520.57) (32,088.02)
12 RETAINED EARNINGS / ACCUMULATED
(DEFICIT), ENDING (12,346.84) 27,378.55
11
<PAGE>
Notes to interim annual financial statement 06/30/2016 EUR
3510 VAT calculation
U 06/2016 291.17
U 2016 18.80
----------
272.37
3550 Tax office
Balance tax office account 06/30/2016 569.42
2900 Active accruals & deferrals
Leasing payment Toyota RAV 4 12,000.00
Cancellation of advance lease payment Toyota RAV 4 4,500.00
----------
7,500.00
3020 Provision for corporate tax
Corporate tax 2015 2,338.00
Corporate tax 06/01/2016 7,231.00
----------
9,569.00
3044 Provision for unutilized vacation entitlement
Unutilized vacation entitlements as of 06/30/2016 25,851.28
3060 Consultancy and financial statement costs
Financial statement 2015 2,500.00
Financial statement 2016 (50%) 1,250.00
Interim financial statement as of 06/30/2016 1,500.00
----------
5,250.00
3090 Other provisions
Audit by auditor as of 06/30/2016 8,000.00
Employee premium 2015 20,066.67
----------
28,066.67
3700 Payroll account
Open managing director cover 4 months 14.000.00
3710
IKG 06/2006 48.33
Tigas 06/2006 47.50
A1 Telekom 06/2006 185.88
Hutchison Drei Telekom 06/2006 16.67
BH + LV 06/2006 329.60
Engage 06/2006 32,000.00
Hall AG 06/2006 411.72
Toyota Leasing 06/2006 445.47
33,485.17
12
<PAGE>
Cash flow statement as of 06/30/2016 EUR
Liquid funds 06/30/2016 01/01/2016
2801 Hypo AT785700030053405310 55,687 50,182
Total liquid funds 55,687 50,182
--------
Changes to liquid funds: 5,505
Profit acc. To P&L statement 97,174
Plus:
Expenses not related to cash:
Write-offs 8,339
Write-offs on financial assets -
minus:
Income not related to cash: 8,339
Changes to net current assets
Changes to stock -
Changes to services not yet invoiced 21,800
Changes to customer payments 21,390
Changes to receivables from subsidiaries -
Changes to other receivables 788
Changes to ARAP 1,500
Changes to trade payables 1,221
Changes to provisions 21,188
Changes to other liabilities,
cleaning accounts 36,009 13,498
----------
1. Net cash flow from ongoing business activities 119,010
----------
Investments 2,004
Book value fixed assets -
----------
2. Net cash flow from investment activities 29,878
----------
Payment of share capital -
Loan: -
Change (payment of loan): 111,500
Change to current account (liabilities): -
Dividends -
----------
3. Net cash flow from financing activities 111,500
----------
Cash Flow (= changes liquid funds = total from 1.-3.) 5,505
----------
13
<PAGE>
Evidence account in accordance with Article 4 (12) of EStG
<TABLE>
Accounts acc.
to financial
statement 01/01/2016 Inflow Outflow Rebooking 06/30/2016
<S> <c> <c> <c> <c> <c> <c>
External financing:
Nominal capital 35,000.00 - 35,000.00 35,000.00
Capital reserves
Retained earnings
Net profit
------------------------------------------------------------------------------------
Total 35,000.00 - 35,000.00 35,000.00
Internal financing:
Net profit 12,346.84 109,520.57 97,173.73 12,346.84
------------------------------------------------------------------------------------
Total 12,346.84 109,520.57 97,173.73 12,346.84
====================================================================================
Total share capital 12,346.84 109,520.57 97,173.73 12,346.84
------------------------------------------------------------------------------------
</TABLE>
14
<PAGE>
<TABLE>
Inv- Asset description Procurement Inflow Outflow Rebooking Procurement Book value
No. value value Cum.
01/01/2016 (AW) (AW) (AW) 06/30/2016 Depreciation 06/30/2016
<S> <c> <c> <c> <c> <c> <c> <c> <c>
Account 120 Data processing program
1-1 Red gate SQL Source Control 956.25 0.00 0.00 0.00 956.25 876.53 79.73
1-2 Red gate SQL Developer Bundle 1,228.25 0.00 0.00 0.00 1,228.25 1,125.86 102.39
1-3 Red gate .NET Tool belt 1,483.25 0.00 0.00 0.00 1,483.25 1,359.61 123.64
2-0 Teamviewer 8 Corporate 1,990.00 0.00 0.00 0.00 1,990.00 1,824.13 165.87
3-0 Server license 465.00 0.00 0.00 0.00 465.00 387.47 77.54
4-0 Licenses 08/2014 - 09/2017 2,564.11 0.00 0.00 0.00 2,564.11 1,709.41 854.70
------------------------------------------------------------------------------
Account total: 8,686.86 0.00 0.00 0.00 8,686.86 7,283.00 1,403.86
Account 120 Data processing program
1-0 PRTG 1000 Network Monitor 2,000.00 0.00 0.00 0.00 2,000.00 1,000.00 1,000.01
2-0 PRTG 1000 Network Monitor
upgrade unlimited 8,000.00 0.00 0.00 0.00 8,000.00 2,666.66 5,333.34
3-0 Octopus SW Development tool 950.00 0.00 0.00 0.00 950.00 475.00 475.01
------------------------------------------------------------------------------
Account total 10,950.00 0 0 0 10,950.00 4,141.65 6,808.35
Account 660 Operating and office equipment
1-0 Toshiba Notebook Tecra R950-19E 885.00 0.00 0.00 0.00 885.00 811.22 73.79
2-0 Toshiba Notebook Tecra R950-19E 885.00 0.00 0.00 0.00 885.00 811.22 73.79
3-0 5Stk. Toshiba Docking station 600.00 0.00 0.00 0.00 600.00 549.97 50.04
4-0 8 Stk. Samsung Monitor LED 21.5 " 894.00 0.00 0.00 0.00 894.00 819.47 74.54
5-0 Toshiba Tecra R950-19E + ASUS PC 1,265.00 0.00 0.00 0.00 1,265.00 1,159.55 105.46
6-0 Toshiba Tecra R950-19E + Monitor 1,302.34 0.00 0.00 0.00 1,302.34 1,193.78 108.57
7-0 Scanner 737.00 0.00 0.00 0.00 737.00 675.55 61.46
8-0 Notebook Toshiba Tecra Z930 15C 1,090.00 0.00 0.00 0.00 1,090.00 681.25 408.75
9-0 Notebook Toshiba Tecra Z930 15C 1,090.00 0.00 0.00 0.00 1,090.00 681.25 408.75
10-0 HP Elite book 840 960.00 0.00 0.00 0.00 960.00 480.00 480.00
12-0 Cabinet Galant 457.50 0.00 0.00 0.00 457.50 91.50 366.01
13-0 HP Server 491315-421 incl.
hard discs 4,402.00 0.00 0.00 0.00 4,402.00 2,201.00 2,201.00
14-0 PC 800 G1TWR plus accessories 2,897.10 0.00 0.00 0.00 2,897.10 1,448.54 1,448.56
15-0 3 PC`s PC 800 G1twr Ci7/4770
plus accessories 4,237.71 0.00 0.00 0.00 4,237.71 2,118.86 2,118.86
17-0 Notebook ASUS X555LA 405.90 0.00 0.00 0.00 405.90 202.95 202.95
18-0 Apple Iphone 5S 499.17 0.00 0.00 0.00 499.17 249.59 249.59
19-0 PC 800 G1TWR plus Monitor 1,424.40 0.00 0.00 0.00 1,424.40 712.20 712.20
20-0 Notebook Toshiba Satellite
incl. accessories 1,570.74 0.00 0.00 0.00 1,570.74 785.37 785.37
21-0 PC ASUS D310MT 1,018.60 0.00 0.00 0.00 1,018.60 509.31 509.31
22-0 Olympus TG-4 Black incl.
accessories 424.15 0.00 0.00 0.00 424.15 141.39 282.76
23-0 Dell Server Poweredge M630 7,200.00 0.00 0.00 0.00 7,200.00 2,400.00 4,800.00
24-0 PC 800 G1TWR incl. accessories 2,773.60 0.00 0.00 0.00 2,773.60 924.54 1,849.06
25-0 Apple IPhone 5S 16 GB 416.66 0.00 0.00 0.00 416.66 138.88 277.79
26-0 Apple iPhone 6 0.00 914.92 0.00 0.00 914.92 152.49 762.43
27-0 iPad Air 2 0.00 590.83 0.00 0.00 590.83 98.48 492.36
28-0 Saturn ASUS Notebook R556UF-X0036T 0.00 499.17 0.00 0.00 499.17 83.20 415.98
------------------------------------------------------------------------------
Account total: 37,435.87 2,004.92 0.00 0.00 39,440.79 20,121.49 19,319.30
</TABLE>
15
<PAGE>
<TABLE>
Inv- Asset description Book value Appreciation Depreciation
No. 01/01/2016
<S> <c> <c> <c> <c>
Account 120 Data processing program
1-1 Red gate SQL Source Control 159.38 0.00 79.66
1-2 Red gate SQL Developer Bundle 204.71 0.00 102.32
1-3 Red gate .NET Tool belt 247.21 0.00 123.57
2-0 Teamviewer 8 Corporate 331.67 0.00 165.80
3-0 Server license 155.00 0.00 77.47
4-0 Licenses 08/2014 - 09/2017 1,282.05 0.00 427.35
-------------------------------------------
Account total: 2,380.02 0.00 976.16
Account 120 Data processing program
1-0 PRTG 1000 Network Monitor 1,333.34 0.00 333.34
2-0 PRTG 1000 Network Monitor
upgrade unlimited 6,666.68 0.00 1,333.34
3-0 Octopus SW Development tool 633.34 0.00 158.34
-------------------------------------------
Account total 8,633.36 0 1,825.01
Account 660 Operating and office equipment
1-0 Toshiba Notebook Tecra R950-19E 147.50 0.00 73.72
2-0 Toshiba Notebook Tecra R950-19E 147.50 0.00 73.72
3-0 5Stk. Toshiba Docking station 100.00 0.00 49.97
4-0 8 Stk. Samsung Monitor LED 21.5 " 149.00 0.00 74.47
5-0 Toshiba Tecra R950-19E + ASUS PC 210.84 0.00 105.39
6-0 Toshiba Tecra R950-19E + Monitor 217.06 0.00 108.50
7-0 Scanner 122.84 0.00 61.39
8-0 Notebook Toshiba Tecra Z930 15C 545.00 0.00 136.25
9-0 Notebook Toshiba Tecra Z930 15C 545.00 0.00 136.25
10-0 HP Elite book 840 600.00 0.00 120.00
12-0 Cabinet Galant 388.88 0.00 22.88
13-0 HP Server 491315-421 incl.
hard discs 2,751.25 0.00 550.25
14-0 PC 800 G1TWR plus accessories 1,810.70 0.00 362.14
15-0 3 PC`s PC 800 G1twr Ci7/4770
plus accessories 2,825.14 0.00 706.29
17-0 Notebook ASUS X555LA 270.60 0.00 67.65
18-0 Apple Iphone 5S 332.78 0.00 83.20
19-0 PC 800 G1TWR plus Monitor 949.60 0.00 237.40
20-0 Notebook Toshiba Satellite
incl. accessories 1,047.16 0.00 261.79
21-0 PC ASUS D310MT 679.06 0.00 169.77
22-0 Olympus TG-4 Black incl.
accessories 353.45 0.00 70.69
23-0 Dell Server Poweredge M630 6,000.00 0.00 1,200.00
24-0 PC 800 G1TWR incl. accessories 2,311.33 0.00 462.27
25-0 Apple IPhone 5S 16 GB 347.23 0.00 69.45
26-0 Apple iPhone 6 0.00 0.00 152.49
27-0 iPad Air 2 0.00 0.00 98.48
28-0 Saturn ASUS Notebook R556UF-X0036T 0.00 0.00 83.20
----------------------------------------
Account total: 22,851.92 0.00 5,537.54
</TABLE>
16
<PAGE>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.3
<SEQUENCE>4
<FILENAME>emgl160907-ex993_odissea.txt
<DESCRIPTION>UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION
<TEXT>
Exhibit 99.3
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
On July 1, 2016, Newgioco Group, Inc. ("Newgioco Group" or the "Company")
completed its acquisition of Odissea Betriebsinformatik Beratung Gmbh
("Odissea") by purchasing all of the issued and outstanding equity of Odissea
for approximately $4,386,100, funded by the issuance of 4,386,100 shares of
common stock of Newgioco Group (referred to herein as the "Acquisition").
Odissea is a software development company engaged in the design, development and
operation of a proprietary betting operating system and online gaming products.
The following unaudited pro forma condensed combined financial information and
related notes present the historical condensed combined financial information of
Newgioco Group and Odissea, after giving effect to the Acquisition on July 1,
2016. Unless otherwise indicated, information in this report is presented in
U.S. dollars ("USD" or "$").
The unaudited pro forma condensed combined statements of earnings for the six
months ended June 30, 2016 and the year ended December 31, 2015 have been
prepared to reflect the Acquisition as if it occurred on January 1, 2016 and
January 1, 2015, respectively.
The pro forma condensed combined financial information is presented for
illustrative purposes only and is not necessarily indicative of the what the
combined Company's financial condition or results of operations would have been
had the Acquisition occurred on the dates indicated. They also may not be useful
in predicting the future financial condition and results of operations of the
combined corporation. The actual financial position and results of operations
may differ significantly from the pro forma amounts reflected herein due to a
variety of factors.
The assumptions and estimates underlying the unaudited adjustments to the pro
forma condensed combined financial statements are described in the accompanying
notes, which should be read together with the pro forma condensed combined
financial statements.
The accompanying unaudited pro forma condensed combined financial information
should be read in conjunction with the historical consolidated financial
statements of Newgioco Group included in the Company's annual report on Form
10-K for the year ended December 31, 2015 and quarterly report on Form 10-Q for
the quarter ended June 30, 2016, filed with the SEC, and the historical combined
financial statements of Odissea, included herein.
<PAGE>
NEWGIOCO GROUP, INC.
UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
DECEMBER 31, 2015
<TABLE>
Newgioco Pro Forma Pro Forma
Group, Inc. Odissea Adjustments Balance Sheet
<S> <c> <c> <c> <c>
Assets
Current assets
Cash and cash equivalents $ 157,363 $ 54,869 $ 212,232
Accounts receivable - 80,418 80,418
Gaming accounts receivable, net 178,151 178,151
Prepaid expenses 315,666 9,185 324,851
Other current assets 36,725 9,900 46,625
-----------------------------------------------------------
Total Current Assets 687,905 154,372 842,277
Non-current assets
Restricted cash 232,013 232,013
Property, Plant and Equipment 88,705 24,986 113,691
Intangible assets 2,376,540 12,042 4,300,000 6,688,582
Goodwill 260,318 61,662 321,980
Investment in non-consolidated entities 6,729 6,729
-----------------------------------------------------------
Total non-current assets 2,964,305 37,028 4,361,662 7,362,995
-----------------------------------------------------------
Total Assets $3,652,210 $ 191,400 $4,361,662 $ 8,205,272
===========================================================
Liabilities and Stockholders' Equity
Current
Line of credit - bank $ 312,483 $ 312,483
Accounts payable and accrued liabilities 571,501 205,086 776,587
Gaming accounts balances 274,942 274,942
Taxes payable 165,166 67,795 232,961
Advances from stockholders 191,675 191,675
Liability in connection with acquisition 327,536 327,536
Debentures, net of discount 112,848 112,848
Derivative liability 28,375 28,375
Promissory notes payable - other 294,368 294,368
Other current liabilities 1,450 1,450
-----------------------------------------------------------
Total Current Liabilities 2,280,344 272,881 - 2,553,225
Long term liabilities 67,532 67,532
-----------------------------------------------------------
Total Liabilities 2,347,876 272,881 - 2,620,757
Stockholders' Equity (Deficiency)
Common stock 2,413 38,269 37,830) 2,852
Additional Paid-in Capital 10,472,501 4,399,492 14,871,993
Accumulated Other Comprehensive income 124,265 (982) 123,283
Accumulated deficit (9,294,845) (118,768) (9,413,613)
-----------------------------------------------------------
Total Stockholders' Equity 1,304,334 (81,481) 4,361,662 5,584,515
Total Liabilities and
Stockholders' Equity $3,652,210 $ 191,400 $4,361,662 $8,205,272
===========================================================
</TABLE>
<PAGE>
See accompanying notes to combined financial information
NEWGIOCO GROUP, INC.
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
YEAR ENDED DECEMBER 31, 2015
<TABLE>
Newgioco Pro Forma Pro Forma
Group, Inc. Odissea Adjustments Statement of Operations
<S> <c> <c> <c> <c>
Revenue $ 4,872,902 $ 506,303 $ - $ 5,379,205
Costs and expenses
Selling expenses 3,663,165 3,663,165
General and administrative expenses 2,837,800 437,895 3,275,695
-------------------------------------------------------------
Total Costs and Expenses 6,500,965 437,895 6,938,860
-------------------------------------------------------------
Loss from operations (1,628,063) 68,408 (1,559,655)
Other expenses (Income)
Interest expense, net of interest income 205,355 4 205,359
Changes in fair value of
derivative liabilities 22,808 22,808
Imputed interest on related party advances 5,309 5,309
Allowance for deposit on acquisition 94,952 94,952
Impairment on investment 30,185 30,185
-------------------------------------------------------------
Total other expenses 358,609 4 358,613
-------------------------------------------------------------
Loss before income taxes (1,986,672) 68,404 (1,918,268)
Income taxes (35,991) 2,715 (33,276)
-------------------------------------------------------------
Net Loss (2,022,663) 65,689 (1,884,992)
Other Comprehensive Income (loss)
Foreign currency translation adjustment 84,385 (982) 83,403
-------------------------------------------------------------
Total Comprehensive loss for
the period $ (1,938,278) $ 64,707 $ - $ (1,801,589)
=============================================================
Basic and fully diluted loss
per common share (0.08) (0.06)
Weighted average number of shares
outstanding
Basic and diluted 23,412,131 27,786,214
</TABLE>
See accompanying notes to combined financial information
<PAGE>
NEWGIOCO GROUP, INC.
UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
JUNE 30, 2016
<TABLE>
Newgioco Pro Forma Pro Forma
Group, Inc. Odissea Adjustments Balance Sheet
<S> <c> <c> <c> <c>
Assets
Current assets
Cash and cash equivalents $ 121,130 $ 61,968 $ 183,098
Accounts recievable 129,907 129,907
Gaming accounts receivable, net 252,898 252,898
Prepaid expenses 221,683 9,348 231,031
Other current assets 30,944 9,282 40,226
-------------------------------------------------------------
Total Current Assets 626,655 210,505 837,160
Non-current assets
Restricted cash 263,877 263,877
Property, Plant and Equipment 85,710 21,499 107,209
Intangible assets 2,139,321 9,139 (b) 4,300,000 6,448,460
Goodwill 260,318 (b) 61,662 321,980
Investment in non-consolidated entities 6,848 6,848
-------------------------------------------------------------
Total non-current assets 2,756,074 30,638 4,361,662 7,148,374
-------------------------------------------------------------
Total Assets $3,382,729 $ 241,143 $ 4,361,662 $ 7,985,534
=============================================================
Liabilities and Stockholders' Equity
Current
Line of credit - bank $ 289,614 $ 289,614
Accounts payable and accrued liabilities 446,731 132,418 579,149
Gaming accounts balances 252,174 252,174
Taxes payable 175,441 83,517 258,958
Advances from stockholders 92,572 92,572
Liability in connection with acquisition 131,931 131,931
Debentures, net of discount 240,931 240,931
Derivative liability 269,415 269,415
Promissory notes payable - other 115,980 115,980
Promissory notes payable - related party 318,078 318,078
-------------------------------------------------------------
Total Current Liabilities 2,332,867 215,935 2,548,802
Long term liabilities 82,478 82,478
-------------------------------------------------------------
Total Liabilities 2,415,345 215,935 2,631,280
Stockholders' Equity (Deficiency)
Common stock 2,438 38,948 (a) (38,509) 2,877
Additional Paid-in Capital 10,803,077 (a)(b) 4,400,171 15,203,248
Accumulated Other Comprehensive income 113,988 (330) 113,658
Accumulated deficit (9,952,119) (13,410) (9,965,529)
-------------------------------------------------------------
Total Stockholders' Equity 967,384 25,208 4,361,662 5,354,254
-------------------------------------------------------------
Total Liabilities and
Stockholders' Equity $3,382,729 $ 241,143 $ 4,361,662 $ 7,985,534
=============================================================
</TABLE>
See accompanying notes to combined financial information
<PAGE>
NEWGIOCO GROUP, INC.
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
SIX MONTHS ENDED JUNE 30, 2016
<TABLE>
Newgioco Pro Forma Pro Forma
Group, Inc. Odissea Adjustments Statement of Operations
<S> <c> <c> <c> <c>
Revenue $ 3,272,844 $ 446,230 $ - $ 3,719,074
Costs and expenses
Selling expenses 2,314,460 2,314,460
General and administrative expenses 1,647,948 330,440 1,978,388
-----------------------------------------------------------------
Total Costs and Expenses 3,962,408 330,440 4,292,848
Loss from operations (689,564) 115,790 (573,774)
Other expenses (Income)
Interest expense, net of interest income 305,495 305,495
Changes in fair value of derivative liabilities (368,216) (368,216)
Imputed interest on related party advances 2,568 2,568
-----------------------------------------------------------------
Total other expenses (60,153) 60,153)
-----------------------------------------------------------------
Income (loss) before income taxes (629,411) 115,790 (513,621)
Income taxes 27,863 7,325 35,188
-----------------------------------------------------------------
Net income (loss) (657,274) 108,465 (548,809)
Other Comprehensive Loss
Foreign currency translation adjustment (10,277) (330) (10,607)
-----------------------------------------------------------------
Total Comprehensive loss for the period $(667,551) $ 108,135 $ - $(559,416)
=================================================================
Basic and fully diluted loss per common share (0.03) (0.02)
Weighted average number of shares outstanding
Basic and diluted 24,244,264 28,630,364
</TABLE>
See accompanying notes to combined financial information
<PAGE>
NEWGIOCO GROUP, INC.
NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
1. Description of Acquisition and Basis of Presentation
The unaudited pro forma condensed combined financial statements have been
compiled from underlying financial information of Newgioco Group, Inc. and
Odissea and reflect the acquisition on July 1, 2016 of 100% of the outstanding
stock of Odissea in consideration for a total of 4,386,100 restricted shares of
the Company's common stock. The Company issued 4,386,100 upon the closing of
acquisition.
The business combination was accounted for using the acquisition method of
accounting, which requires an acquirer to recognize assets acquired and
liabilities assumed at the acquisition date fair value. The estimated fair value
of assets acquired and liabilities assumed is preliminary and differences
between the preliminary and final estimated fair value could be material.
The unaudited pro forma condensed combined financial statements have been
developed from the audited records of Newgioco Group for the year ended December
31, 2015 and the unaudited financial statements for the period ended June 30,
2016, and the audited records of Odissea for the year ended December 31, 2015
and the unaudited financial records for the period ended June 30, 2016.
The unaudited pro forma condensed combined statement of operations is based upon
the historical financial statements of Newgioco Group and Odissea, after giving
effect to the acquisition. The unaudited pro forma condensed combined statement
of operations is presented as if the acquisition had occurred at the beginning
of the period.
The historical financial information of Odissea was prepared using accounting
principles generally accepted in Austria (Austrian GAAP) and is presented in
Euros. Accordingly, Odissea amounts are translated to U.S. dollars.
2. Pro Forma Adjustments
The unaudited pro forma condensed combined financial statements for the fiscal
year ended December 31, 2015 and six months ended June 30, 2016 are presented as
if the acquisition had occurred on January 1, 2015, the first day of that fiscal
year. The pro forma adjustments give effect to the events that are directly
attributable to the transaction and are expected to have a continuing impact on
the financial results of the combined company. The pro forma adjustments are
based on available information and certain assumptions that the Company believes
are reasonable.
The pro forma adjustments included in the unaudited pro forma combined
statements of income are as follows:
(a) Issuance of the 4,386,100 shares of Newgioco Group in exchange for 100% of
the issued common shares of Odissea.
<PAGE>
(b) Reflects the allocation of the purchase price of U.S. $ 4,386,870 in shares
of Newgioco Group common stock to the fair value of the assets acquired. The
allocation of the purchase price is preliminary and therefore subject to
change. The allocation of the purchase price to the fair value of the assets
acquired is as follows:
Total Purchase Price $ 4,386,870
Less: Net assets acquired (25,208)
Less: Intangible assets (4,300,000)
---------
Goodwill $ 61,662
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>