EX-99.3 7 energie0630ex99_3.htm ENERGIE HOLDINGS, INC.

Exhibit 99.3

 

ENERGIE HOLDINGS, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

 

As used in this report, we, us, our, Energie Holdings or Company refer to Energie Holdings, Inc. The unaudited pro forma condensed combined financial statements present the impact on our financial position and results of operations from our acquisition of 100% of the membership interest in Energie LLC. We paid a purchase price of 33,000,000 shares of Energie Holdings common stock.

 

The pro forma financial statements as of March 31, 2014, for the three months ended March 31, 2014, and for the year ended December 31, 2013, have been prepared based on certain pro forma adjustments to our historical financial statements set forth in our Annual Report on Form 10-K for the year ended December 31, 2013, and our Quarterly Report on Form 10-Q for the three-month period ended March 31, 2014, as filed with the Securities and Exchange Commission, and are qualified in their entirety by reference to such historical financial statements and related notes contained in those reports. The historic financial statements for Energie LLC were derived from audited financial statements for the year ended December 31, 2013. The unaudited pro forma condensed combined financial statements should be read in conjunction with the accompanying notes and with the historical consolidated financial statements and related notes thereto.

 

The unaudited pro forma condensed combined balance sheet has been prepared as if the transaction had occurred as of March 31, 2014. The unaudited pro forma condensed combined statements of operations have been prepared as if this transaction had occurred on January 1, 2013.

 

These unaudited pro forma condensed combined financial statements are presented for illustrative purposes only. Such information is not necessarily indicative of the operating results or financial position that would have occurred had the acquisition been completed at the dates indicated or what would be any future periods. The consideration given and the purchase price allocation in these pro formas is based on preliminary estimated fair values. We have not completed our determination of the fair value of the consideration given or the net assets acquired. Accordingly, the fair value of consideration given and the allocation of purchase price is preliminary and subject to adjustments. Upon completion of our valuation analysis, the fair value of the consideration given and the allocation of purchase price may change significantly. Such changes may include, but not be limited to, the fair value of intangible assets and goodwill, and potential impairment charges.

 
 

 

ENERGIE HOLDINGS, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET

March 31, 2014

 

   Energie
Holdings		  Energie
LLC
(a)		  Pro Forma Adjustments  Energie Holdings Pro Forma
Assets                    
Current assets:                    
Cash and cash equivalents  $—     $10,416   $27,458(b)  $37,874 
Accounts receivable, net   —      1,040,723    (326,215)(b)   466,324 
              (248,184)(c)     
Inventory   —      404,346    9,962(b)   414,308 
Prepaid expenses   —      8,917    7,005(b)   15,922 
  Total current assets   —      1,464,402    (529,974)   934,428 
                     
Goodwill and intangible assets   —      1,100,408    4,000,965(b)   5,101,373 
Property and equipment, net   —      6,237    17,184(b)   23,421 
Other   —      11,695    —      11,695 
                     
Total assets  $—     $2,582,742    3,488,175   $6,070,917 
                     
Liabilities and Equity                    
Current liabilities:                    
Accounts payable  $248,184   $847,307    (252,105)(b)  $595,202 
              (248,184)(c)     
Other   —      102,184    (10,217)   91,967 
Notes payable   —      4,316,496    (334,564)(b)   3,981,932 
  Total current liabilities   248,184    5,265,987    (845,070)   4,669,101 
                     
Equity:                    
Energie Holdings, Inc.   (248,184)   —      1,650,000(b)   1,401,816 
Energie LLC   —      (2,683,245)   2,683,245(b)   —   
  Total equity   (248,184)   (2,683,245)   4,333,245    1,401,816 
                     
Total liabilities and equity  $—     $2,582,742   $3,488,175   $6,070,917 
                     

 

See accompanying notes to unaudited pro forma condensed combined financial statements.

 
 


ENERGIE HOLDINGS, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

Three months ended March 31, 2014

 

   Energie
Holdings		  Energie
LLC
(a)		  Pro Forma Adjustments  Energie Holdings Pro Forma
Revenue  $—     $164,609   $—     $164,609 
Cost of revenue   —      (70,102)   —      (70,102)
  Gross profit   —      94,507    —      94,507 
                     
Operating expenses:                    
Commissions   —      26,673    —      26,673 
Compensation   —      125,283    —      125,283 
Depreciation and amortization   —      42,254    (25,070)(d)   17,184 
General and administrative   —      38,352    —      38,352 
Professional fees   173,425    5,799    (173,425)(c)   5,799 
Rent   —      53,666    —      53,666 
Travel   —      6,207    —      6,207 
  Total operating expenses   173,425    298,234    (198,495)   273,164 
                     
Loss from operations   (173,425)   (203,727)   198,495    (178,657)
                     
Interest expense   —      (87,570)   —      (87,570)
Other income (expense)   —      26,524    (173,425)(c)   (146,901)
                     
Net loss  $(173,425)  $(264,773)  $25,070   $(413,128)
                     
Net loss per share
Basic and diluted		  $(0.01)            $(0.01)
                     
Shares outstanding
Basic and diluted		   19,429,347              51,400,000 
                     

 

See accompanying notes to unaudited pro forma condensed combined financial statements.

 
 


ENERGIE HOLDINGS, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

Year ended December 31, 2013

 

   Energie
Holdings		  Energie
LLC
(a)		  Pro Forma Adjustments  Energie Holdings Pro Forma
Revenue  $—     $1,733,373   $—     $1,733,373 
Cost of revenue   —      (758,739)   —      (758,739)
  Gross profit   —      974,634    —      974,634 
                     
Operating expenses:                    
Commissions   —      372,954    —      372,954 
Compensation   —      600,786    —      600,786 
Depreciation and amortization   —      238,053    (227,267)(d)   10,786 
Impairment   —      —      5,101,373(d)   5,101,373 
General and administrative   —      161,567    —      161,567 
Professional fees   184,299    22,746    (184,299)(c)   22,746 
Rent   —      217,088    —      217,088 
Travel   —      8,502    —      8,502 
  Total operating expenses   184,299    1,621,696    4,689,807    6,495,802 
                     
Loss from operations   (184,299)   (647,062)   (4,689,807)   (5,521,168)
                     
Interest expense   —      (421,787)   —      (421,787)
Other income (expense)   —      114,251    (184,299)(c)   (70,048)
                     
Net loss  $(184,299)  $(954,598)  $(4,874,106)  $(6,013,003)
                     
Net loss per share
Basic and diluted		  $(0.00)            $(0.12)
                     
Shares outstanding
Basic and diluted		   39,638,991              51,000,000 
                     

 

See accompanying notes to unaudited pro forma condensed combined financial statements.

 
 

 

 

Note 1.  Basis of Presentation

 

The historical financial information is derived from our historical financial statements and the historical financial statements of Energie LLC.  The pro forma adjustments have been prepared as if we acquired Energie LLC on March 31, 2014, for the balance sheet, and on January 1, 2013, for the statements of operations.

 

The pro forma combined financial statements reflect the following the acquisition of 100% of the member interest in Energie LLC in exchange for 33,000,000 shares of Energie Holdings, Inc. common stock.

 

Note 2.  Pro Forma Adjustments and Assumptions

 

(a)                                 Reflects 100% of the assets, liabilities, income and expenses of Energie LLC.

 

(b)                                The total purchase price of $1,650,000 is based on the issuance of 33,000,000 shares of Energie Holdings, Inc. at the closing price of the Company’s stock on December 31, 2013, of $0.05 per common share. The following reflects the allocation of the consideration as of December 31, 2013, subject to adjustments arising from final determination of the fair value of the consideration transferred and the allocation of purchase price to the acquired assets and liabilities:

 

Consideration:
Energie Holdings common stock $  1,650,000
Allocation of purchase price:
Cash $  37,874
Accounts receivable 714,508
Inventory 414,308
Prepaid expenses 15,922
Goodwill and intangible assets 5,101,373
Property and equipment 23,421
Deposits 11,695
Accounts payable (522,202)
Commissions payable (91,967)
Debt (3,981,932)
$  1,650,000

 

The acquisition of Energie LLC was accounted for under the purchase method of accounting.  The consideration transferred and the purchase price allocation in these pro formas is based on preliminary estimated fair values.

 

We have not completed our determination of the fair value of the consideration transferred or the net assets acquired. Accordingly, the fair value of consideration given and the allocation of purchase price is preliminary and subject to adjustments. Upon completion of our valuation analysis, the fair value of the consideration given and the allocation of purchase price may change significantly. Such changes may include, but not be limited to, the fair value of intangible assets and goodwill, and potential impairment charges.

 

(c)                                  Reflects elimination of intercompany transactions.

 

(d)                                 We performed a preliminary impairment assessment of Goodwill and intangible assets, and estimate that they are fully impaired. This adjustment reflects the impairment of Goodwill and intangible assets, and elimination of the historic amortization expense.

 

 
 

 

Note 3.  Net Loss Per Share

 

The following table illustrates our calculation of pro forma net loss per share:

 

Year ended

December 31, 2013

Three months ended

March 31, 2014

Pro forma net loss $  (6,013,003) $  (413,128)
Weighted-average shares outstanding:
Previously reported 39,638,991 19,429,347
Incremental shares 11,361,009 31,970,653
Pro forma shares 51,000,000 51,400,000

Net loss per share

Basic and diluted

 

$ (0.12)

 

$ (0.01)

 

Incremental shares are less than the amount issued for the transaction, because shares held in escrow for the transaction were included in the previously reported weighted-average shares outstanding.