EX-99.3 4 v087520_ex99-3.htm
Exhibit 99.3

Science Dynamics Corporation, Inc. and Subsidiaries
Unaudited Pro Forma Combined Financial Statements
 
The following unaudited pro forma combined financial statements of the Company presents the unaudited combined statements of operations for the year ended December 31, 2005 and September 30, 2006, as if the acquisition of Ricciardi Technologies Inc. had occurred January 1, 2005.

The acquisition will be accounted for as a purchase, with the assets acquired and the liabilities assumed recorded at fair values.

The pro forma adjustments represent, in the opinion of management, all adjustments necessary to present the Company's pro forma combined financial position and results of its combined operations in accordance with Article 11 of SEC Regulation S-X based upon available information and certain assumptions considered reasonable under the circumstances.

The unaudited pro forma combined financial statements presented herein is for illustrative purposes only and is not necessarily indicative of the operating results or financial position that would have occurred if the purchase had been consummated on such dates, nor is it necessarily indicative of future operating results or financial position. The unaudited pro forma combined financial statements should be read in conjunction with the audited financial statements of the Company and the notes thereto.

-1-
 
Lattice Incorporated (formerly Science Dynamics Corporation)
Statement of Operations
Proforma for the Twelve Months ended December 31, 2006
 
           
Twelve Months
  
           
31-Dec-06
  
   
Twelve Months
  
Adjustments
  
2006
  
       
January 1, 2006 to
      
Dr(Cr)
      
   
2006
  
Septmeber 19, 2006
              
   
Lattice Incorporated
  
RTI
  
Consolidated
      
Combined Proforma
  
                                 
Sales - Technology Products
  
$
1,692,052
        
$
1,692,052
          
1,692,052
 
Sales- Technology Services
    
5,802,836
   
3,640,176
   
9,443,012
         
9,443,012
 
     
7,494,888
   
3,640,176
   
11,135,064
         
11,135,064
 
                                 
Cost of Sales - Technology Products
    
554,136
         
554,136
         
554,136
 
Cost of Sale - Technology Services
    
2,801,085
   
1,644,523
   
4,445,608
         
4,445,608
 
     
3,355,221
   
1,644,523
   
4,999,744
         
4,999,744
 
     
 
    
 
    
 
          
 
  
Gross Profit
    
4,139,667
   
1,995,653
   
6,135,320
         
6,135,320
 
     
55
%
  
55
%
  
55
%
        
55
%
                                 
Operating costs and expenses:
                                
                                 
Research and development
    
435,768
   
-
   
435,768
         
435,768
 
Selling, general and Administrative
    
3,248,013
   
1,536,515
   
4,784,528
         
4,784,528
 
                                 
Total Operation Expenses
    
3,683,781
   
1,536,515
   
5,220,296
         
5,220,296
 
                                 
 
    
 
    
 
    
 
          
 
  
Total Operating Income
    
455,886
   
459,138
   
915,024
         
915,024
 
                                 
                                 
Other income (expenses):
                                
Gain and Loss of investments
    
-
         
-
         
-
 
Interest & Dividend income
          
34,645
   
34,645
         
34,645
 
Other Income
    
-
   
(15,040
)
  
(15,040
)
        
(15,040
)
Interest expense
    
(704,178
)
        
(704,178
)
  
(251,473
)(1)
  
(711,455
)
 
                
-
    
258,750
 (3)      
Extinguishment Loss
    
(158,266
)
  
-
   
(158,266
)
        
(158,266
)
Derivative income (expenses)
    
(13,753,295
)
        
(13,753,295
)
        
(13,753,295
)
Minority interest
    
(57,245
)
        
(57,245
)
        
(57,245
)
Finance Expense
    
(1,334,336
)
  
-
   
(1,334,336
)
  
884,948
 (2)  
(2,219,284
)
Total Other income (expenses)
    
(16,007,320
)
  
19,605
   
(15,987,715
)
        
(16,879,940
)
                                 
Net Income (Loss)
    
(15,551,434
)
  
478,743
   
(15,072,691
)
  
892,225
   
(15,964,916
)
 
 
Lattice Incorporated (formerly Science Dynamics Corporation)
Statement of Operations
Proforma for the Twelve Months ended December 31, 2005

   
Twelve Months
     
December 31,
 
   
December 31, 2005
  
Adjustments
  
2005
  
   
Lattice
  
RTI
  
Consolidated
  
Dr(Cr)
  
Combined Proforma
  
                       
Sales - Technology Products
  
$
1,224,042
        
$
1,224,042
        
$
1,224,042
  
Sales- Technology Services
    
3,011,227
   
4,542,842
   
7,554,069
         
7,554,069
 
     
4,235,269
   
4,542,842
   
8,778,111
         
8,778,111
 
                                 
Cost of Sales - Technology Products
    
439,483
         
439,483
         
439,483
 
Cost of Sale - Technology Services
    
1,834,281
   
2,021,126
   
3,855,407
         
3,855,407
 
     
2,273,764
   
2,021,126
   
4,294,890
   
-
   
4,294,890
 
                                 
Gross Profit
    
1,961,505
   
2,521,716
   
4,483,221
         
4,483,221
 
                                 
                                 
Operating costs and expenses:
                                
                                 
Research and development
    
431,021
   
-
   
431,021
         
431,021
 
Selling, general and Administrative
    
2,537,365
   
1,611,411
   
4,148,776
         
4,148,776
 
                                 
Total Operation Expenses
    
2,968,386
   
1,611,411
   
4,579,797
         
4,579,797
 
                                 
 
           -    
-
             
                                 
Total Operating Income (loss)
    
(1,006,881
)
  
910,305
   
(96,576
)
        
(96,576
)
                                 
                                 
Other income (expenses):
                                
NJ NOL
    
216,058
   
-
   
216,058
         
216,058
 
Gain and Loss of investments
    
-
   
-
   
-
         
-
 
Interest & Dividend income
          
44,111
   
44,111
         
44,111
 
Derivative income
    
370,027
         
370,027
         
370,027
 
Other Income
          
(14,926
)
  
(14,926
)
        
(14,926
)
Interest expense
    
(509,007
)
  
-
   
(509,007
)
  
(353,171
)(2)
  
(433,336
)
                       
277,500
 (3)      
Minority interest
    
93,679
         
93,679
         
93,679
 
Finance Expense
    
(26,979
)
  
-
   
(26,979
)
  
995,566
 (1)  
(1,022,545
)
Total Other Income (expense)
    
143,778
   
29,185
   
172,963
         
(746,932
)
                                 
Net Income (Loss)
    
(863,103
)
  
939,490
   
76,387
   
919,895
   
(843,508
)
 
 
Science Dynamics Corporation, Inc. and Subsidiaries
Notes to Unaudited Pro Forma Combined Financial Statements

Twelve Months ended December 31, 2006:

1.  
Represents the reversal of interest charged of $251,473 on the $2.0M Laurus Convertible Note extinguished September 19, 2006 in conjunction with the RTI acquisition financing placed with Barron Capital Partners.
2.  
Represents the additional amortization expense of deferred finance costs of $884,948 covering the period January 1, 2006 until September 19, 2006 associated with the $4.5M convertible note placed with Barron Capital Partners on September 19, 2006. The amortization expense assumes the Barron Note with a term of 9 months was in place January 1, 2006. The total amortization expense related to the Barron Note for the nine months ended September 30, 2006 was $995,566..
3.  
Additional interest expense of $258,750 for the period January 1 to September 19, 2006 which includes; (i) the interest chargeable on the $250,000 note with Laurus Capital as part of the refinancing which occurred on September 19, 2006 in conjunction with the “RTI” acquisition and (ii) the interest charged on the $500,000 note issued to RTI as part of the purchase price of “RTI” and (iii) interest coupon on the $4,500,000 Barron Convertible Note calculated from January 1, 2006.

Twelve Months ended December 31, 2005:
 
1.  
The charge of $995,566 to finance expense represents the amortization of deferred financing fees tied to the placement of the $4.5M convertible note issued to Barron Capital partners on September 19, 2006 in conjunction with the purchase of “RTI”.
2.  
Represents the reversal of interest charged of $353,171 on the $2.0M Laurus Convertible Note extinguished September 19, 2006 in conjunction with the RTI acquisition financing placed with Barron Capital Partners.
3.  
Interest expense of $277,750 for twelve months reflects; (i) the interest chargeable on the $250,000 note with Laurus Capital as part of the refinancing which occurred on September 19, 2006 in conjunction with the “RTI” acquisition (ii) the interest charged on the $500,000 note issued to RTI as part of the purchase price of “RTI” and (iii) interest coupon on the $4,500,000 Barron Convertible Note (9 Mo Term) calculated from January 1, 2005.