EX-99.3 2 ex99-3.htm EXHIBIT 99.3 ex99-3.htm
EXHIBIT 99.3
 

VISUAL MANAGEMENT SYSTEMS, INC. AND SUBSIDIARIES
(FORMERLY WILDON PRODUCTIONS INC.)
 
PRO-FORMA FINANCIAL STATEMENTS
 

 
The accompanying amended unaudited pro forma consolidated financial statements of Visual Management Systems, Inc. and subsidiaries (formerly Wildon Productions Inc.) (the “Company”) give effect to the (a) merger (the “Merger”) of the Company’s wholly-owned subsidiary, VMS Acquisition Corp., with and into Visual Management Systems Holding, Inc., a New Jersey Corporation (“VMS”) and (b) 1-for-7 reverse split (the “Reverse Split”) of the Company’s common stock, $.01 par value (the “Common Stock”), which became effective on July 17, 2007 as if such transactions had occurred on May 31, 2007 for balance sheet data and March 1, 2006 for Statement of Operations Data.
 
In connection with the Merger, the Company acquired 100% of the issued and outstanding capital stock of VMS in exchange for 5,218,000 shares of the Company’s Common Stock, and certain holders of Common Stock agreed to cancel 476,429 shares (after giving effect to the Reverse Split) of Common Stock at the time of the Merger.  Under the terms of the Merger Agreement, each share of VMS Common Stock outstanding prior to the Merger (10,436,000 shares) was converted into .50 shares of Common Stock at the time of the Merger.  As a result, VMS’ former stockholders became the majority shareholders of the Company and VMS became a wholly-owned subsidiary of the Company.
 
The acquisition of VMS by the Company has been accounted for as a reverse merger because on a post-merger basis, the former VMS shareholders hold a majority of the outstanding shares of the Company’s Common Stock.  As a result, VMS was deemed to be the acquirer for accounting purposes.
 
In April 2008, in conjunction with the audit of the Company’s financial statements for the year ended December 31, 2007, the Company’s management, after discussions with the Company’s independent registered public accounting firm, determined that its previously issued pro forma financial statements for the periods identified above failed to properly record the impact of inter-company transactions on revenue, cost of revenue, and inventory.  In addition, changes were made to properly reflect the impacts on customer deposits and accounts receivable for amounts billed to customers but not yet earned as revenue.  Finally, the identified pro forma statements were modified to properly reflect the impact of the Company’s reverse merger transaction on the equity section of the Company’s balance sheet.
 
In the opinion of the Company’s management, the accompanying amended unaudited pro forma consolidated balance sheet and amended unaudited pro forma statement of loss include all adjustments necessary for the fair presentation of the transactions in accordance with the requirements of the Securities Exchange Commission.  The accompanying amended unaudited pro forma consolidated financial statements are prepared for illustrative purposes only and may not be indicative of the financial position or operating results that would have occurred if the transactions had been completed on March 1, 2006.  Furthermore, the reported unaudited pro forma consolidated statement of loss is not necessarily indicative of the operating results that may be obtained by the Company on an annual basis.

 
VISUAL MANAGEMENT SYSTEMS, INC. AND SUBSIDIARIES
(FORMERLY WILDON PRODUCTIONS INC.)
 
PRO-FORMA STATEMENT OF OPERATIONS
 
FOR THE 3 MONTHS ENDED MAY 31, 2007
 
   
Visual Management
Systems, Inc. (formerly
Wildon Productions Inc.)
    
Visual Management Systems
Holding, Inc. and Subsidiaries
    
Eliminations
    
Pro-Forma Combined
  
                         
Revenues
   $ -     1,459,355             1,459,355  
                             
                             
Cost of revenues
     -     788,512             788,512  
                             
Gross margin
     -     670,843             670,843  
                             
Operating expenses
     40,094     1,610,726       -40,094       1,610,726  
                               
Loss from operations
     -40,094     -939,883       40,094       -939,883  
                               
                               
Other (income) expenses
                              
Debt conversion expense
     -     -               -  
Interest income
     -     -47               -47  
Interest expense
     -     145,374               145,374  
Miscellaneous (income) expense
     -     -               -  
      -     145,327       -       145,327  
                               
                               
Provision for taxes
          
2,933
               2,933  
                               
Net loss
   $ -40,094     -1,088,143       40,094       -1,088,143  
 
 
VISUAL MANAGEMENT SYSTEMS, INC. AND SUBSIDIARIES
(FORMERLY WILDON PRODUCTIONS INC.)
 
PRO-FORMA STATEMENT OF OPERATIONS
 
FOR THE 12 MONTHS ENDED FEBRUARY 28, 2007
 
   
Visual Management
Systems, Inc. (formerly
Wildon Productions Inc.)
    
Visual Management Systems
Holding, Inc. and Subsidiaries
    
Eliminations
    
Pro Forma Combined
  
                         
Revenues - net
     -       4,664,694       -       4,664,694  
                                 
Cost of revenues
     -       2,394,650       -       2,394,650  
                                 
Gross margin
     -       2,270,044       -       2,270,044  
                                 
Operating expenses
     78,979       4,285,187       -78,979       4,285,187  
                                 
Loss from operations
     -78,979       -2,015,142       78,979       -2,015,142  
                                 
                                 
Other (income) expenses
                                
Debt conversion expense
             855,034       -       855,034  
Interest income
             (1,604 )     -       -1,604  
Interest expense
             59,303       -       59,303  
Miscellaneous (income) expense
           1,108       -       1,108  
      -       913,842       -       913,842  
                                 
Provision for taxes
            
182
       -       182  
                                 
                                 
Net loss
   $ -78,979       -2,929,166       78,979       -2,929,166  
 
 
VISUAL MANAGEMENT SYSTEMS, INC. AND SUBSIDIARIES
(FORMERLY WILDON PRODUCTIONS INC.)
PRO-FORMA CONSOLIDATING BALANCE SHEET
31-May-07
 
   
Visual Management
Systems, Inc. (Formerly
Wildon Productions Inc.)
    
Visual Management Systems Holding, Inc. and Subsidiaries
    
Pro Forma
Adjustments
    
Pro Forma Combined
  
Assets
                        
                         
Current Assets
                        
Cash
     14,864             -       14,864  
Accounts Receivable
     -       370,163       -       370,163  
Intercompany Receivable
     -       -       -       -  
Inventory
     -       356,670       -       356,670  
Prepaid Expenses
     -       27,277       -       27,277  
      14,864       754,109       -       768,973  
                                 
Property and Equipment - net
     -       355,955       -       355,955  
Equipment Under Capital Leases - net
     -               -       -  
Deposits
     -       106,132       -       106,132  
Intangibles - net
     -       35,123       -       35,123  
                                 
Total Assets
     14,864       1,251,320               1,266,184  
Liabilities and Stockholders' Deficit
                                
                                 
Current Liabilities
                                
Bank Overdraft
     -       64,551               64,551  
Accounts Payable
     4,120       1,011,375       -       1,015,495  
Interco Payable
     -       -       -       -  
Accrued Expenses
     21,012       330,919       -       351,931  
Customer Deposits
     -       166,849       -       166,849  
Sales Tax Payable
     -       52,225       -       52,225  
Current Portion of Long-Term Debt
     -       78,997       -       78,997  
Current Portion of Obligations Under
   -       -       -       -  
Capital Leases
                                
      25,132       1,704,916       -       1,730,048  
                                 
Convertible Debt
             125,000               125,000  
Long-Term Debt - net of current portion
     -       252,992               252,992  
Obligations Under Capital Leases - net of current
   -       22,995               22,995  
portion
                             -  
Loans Payable Stockholders
     -       4,622               4,622  
                              -  
Stockholders Deficit
                             -  
Common Stock
     2,035       37,142       -2,035       37,142  
Additional Paid-In Capital
 
   111,965       4,112,690       -122,233       4,102,422  
Treasury Stock
  
 
 -       -150,000               -150,000  
Accumulated Deficit
     -124,268       -4,859,037       124,268       -4,859,037  
      -10,268       -859,205       -       -869,473  
                                 
      14,864       1,251,320       -       1,266,184  
 
 
VISUAL MANAGEMENT SYSTEMS, INC. AND SUBSIDIARIES
(FORMERLY WILDON PRODUCTIONS INC.)
PRO-FORMA CONSOLIDATING BALANCE SHEET
28-Feb-07
 
   
Visual Management
Systems, Inc. (Formerly
Wildon Productions Inc.)
    
Visual Management Systems Holding, Inc. and Subsidiaries
    
Pro Forma
Adjustments
    
Pro Forma Combined
  
Assets
                        
                         
Current Assets
                        
Cash
     49,791       60,204             109,995  
Accounts Receivable
     -       227,405             227,405  
Intercompany Receivable
     -                     -  
Inventory
     -       301,323             301,323  
Prepaid Expenses
     285       8,894             9,179  
      50,076       597,826       -       647,902  
                                 
Property and Equipment - net
     -       323,889       -       323,889  
Equipment Under Capital Leases - net
     -               -       -  
Deposits
     -       75,299       -       4,338  
Intangibles - net
     -       4,338       -       75,299  
                                 
Total Assets
     50,076       1,001,352       -       1,051,428  
Liabilities and Stockholders' Deficit
                                
                                 
Current Liabilities
                                
Bank Overdraft
     -       -               -  
Accounts Payable
             731,817       -       731,817  
Interco Payable
     -               -       -  
Accrued Expenses
     20,700       272,387       -       293,087  
Customer Deposits
     -       146,004       -       146,004  
Sales Tax Payable
     -       35,197       -       35,197  
Current Portion of Long-Term Debt
     -       75,719       -       75,719  
Current Portion of Obligations Under
                              
Capital Leases
     -       -       -        -  
      20,700       1,261,124       -       1,281,824  
                                 
Convertible Debt
             -               -  
Long-Term Debt - net of current portion
     -       282,054               282,054  
Obligations Under Capital Leases - net of current
   -       28,832               28,832  
portion
                             -  
Loans Payable Stockholders
     -       6,000               6,000  
                              -  
Stockholders Deficit
                             -  
Common Stock
     14,250       28,777       -14,250       28,777  
Additional Paid-In Capital
     105,400       3,315,460       -76,024       3,344,836  
Treasury Stock
     -       (150,000 )             -150,000  
Accumulated Deficit
     -90,274       -3,770,895       90,274       -3,770,895  
      29,376       -576,658       -       -547,282  
                                 
      50,076       1,001,352       -       1,051,428