BROOKLYN CHEESECAKE & DESSERTS COMPANY, INC.
|
(Name of Registrant as Specified In Its Charter)
|
|
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
|
(1)
|
Authorize the change of the Company’s name from Brooklyn Cheesecake & Desserts Company, Inc. to Meridian Waste Solutions, Inc.
|
(2)
|
Amend the Articles of Incorporation for the Company to permit shareholders to approve action by written consent setting forth the action so taken, signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted.
|
Sincerely,
|
|
January 29, 2015
|
/s/ Jeffrey Cosman
Jeffrey Cosman
Chief Executive Officer
|
Milton, GA
|
(1)
|
Authorize the change of the Company’s name from Brooklyn Cheesecake & Desserts Company, Inc. to Meridian Waste Solutions, Inc. (the “Name Change”); and
|
(2)
|
Amend the Articles of Incorporation for the Company to permit shareholders to approve action by written consent setting forth the action so taken, signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted (the “Written Consent Amendment”).
|
By Order of the Board of Directors,
|
Date: January 29, 2015 |
/s/ Jeffrey Cosman
Jeffrey Cosman
Chief Executive Officer
|
Page
|
||
GENERAL INFORMATION ABOUT THE PROXY STATEMENT AND SPECIAL MEETING
|
1 | |
ENTRY INTO MEMBERSHIP INTEREST PURCHASE AGREEMENT
|
4 | |
PROPOSAL1: AUTHORIZING TO CHANGE THE NAME OF THE COMPANY TO MERIDIAN WASTE SOLUTIONS, INC.
|
5 | |
PROPOSAL 2: AMENDING THE ARTICLES OF INCORPORATION TO ALLOW FOR ACTIONS TO BE APPROVED BY MAJORITY SHAREHOLDER WRITTEN CONSENT
|
5 | |
SHAREHOLDER PROPOSALS
|
7 | |
PROXY
|
||
EXHIBIT TABLE
|
7 |
Shareholder
|
Common Stock Owned
Beneficially
|
Percent
of Class (1)
|
Series A Preferred Stock Owned
Beneficially
(2)
|
Percent
of Class (2)
|
||||||||||||
Jeffrey Cosman, Chairman, Chief Executive Officer
|
6,270,809 | (3) | 62.9 | %(3) | 51 | 100 | % | |||||||||
All directors and officers as a group (1 person)
|
6,270,809 | (3) | 62.9 | %(3) | 51 | 100 | % |
(1)
|
Based on a total of 9,963,418 shares of Common Stock outstanding as of January 28, 2015, plus any shares of Common Stock deemed to be beneficially owned pursuant to warrants that are exercisable within 60 days from the above date.
|
(2)
|
Based on a total of 51 shares of Series A Preferred outstanding as of January 29, 2015, plus any shares of Common Stock deemed to be beneficially owned pursuant to warrants that are exercisable within 60 days from the above date.
|
(3)
|
Includes 3,822,809 shares of the common stock of the Company issued to Here to Serve Holding Corp. Mr. Cosman is the Chief Executive Officer and director of Here to Serve Holding Corp. and, accordingly, has sole voting power and sole dispositive power over such 3,822,809 shares.
|
Name and Principal Position
|
Year
|
Salary
($)
|
Bonus
($)
|
Stock Awards
($)
|
Option Awards
($)
|
Non-Equity Incentive Plan Compensation
($)
|
Non-Qualified Deferred Compensation Earnings
($)
|
All Other Compensation
($)
|
Totals
($)
|
|||||||||||||||||||||||||
Jeffrey S. Cosman(1)
|
2014
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
|||||||||||||||||||||||||
Chief Executive Officer
|
2013
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
|||||||||||||||||||||||||
and Director
|
2012
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
0
|
|||||||||||||||||||||||||
Anthony J. Merante(2)
|
2014
|
0
|
0
|
0
|
0
|
0
|
0
|
0 |
0
|
|||||||||||||||||||||||||
Former President, Former Chief Executive Officer
|
2013
|
0
|
0
|
0
|
0
|
0
|
0
|
0 |
0
|
|||||||||||||||||||||||||
and Former Chief Financial Officer
|
2012
|
0
|
0
|
0
|
0
|
0
|
0
|
0 |
0
|
Exhibit No.
|
Description
|
|
99.1
|
Here to Serve Holding Corp.’s Audited financial statements for the fiscal years ended September 30, 2013 and September 30, 2012
|
|
99.2
|
Meridian Waste Services, LLC Audited financial statements for the fiscal years ended December 31, 2013 and 2012
|
|
99.3
|
Here to Serve Holding Corp.’s Unaudited financial statements for the nine months ended June 30, 2014 and 2013
|
|
99.4
|
Brooklyn Cheesecake & Desserts Company, Inc. Unaudited Pro Forma Information
|
By Order of the Board of Directors,
|
|||
Date: January 29, 2015
|
/s/ Jeffrey Cosman | ||
Jeffrey Cosman
|
|||
Chief Executive Officer
|
|||
o FOLD AND DETACH HERE AND READ THE REVERSE SIDE o
|
PROXY
|
FOLD AND DETACH HERE AND READ THE REVERSE SIDE
|
PROXY BY MAIL
|
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS AND WILL BE VOTED FOR THE ELECTION OF THE PROPOSED DIRECTORS AND FOR THE ABOVE PROPOSALS UNLESS OTHERWISE INDICATED. THIS PROXY WILL BE VOTED IN ACCORDANCE WITH THE SPECIFICATIONS MADE, BUT IF NO CHOICES ARE INDICATED, THIS PROXY WILL BE VOTED FOR THE ELECTION OF ALL NOMINEES AND FOR THE PROPOSALS LISTED BELOW. |
Please mark boxes [*] or [X] in blue or black ink.
|
x |
FOR | AGAINST | ABSTAIN | ||||
1.Proposal: Authorizing the Company name change to Meridian Waste Solutions, Inc.
|
||||||
2. Proposal:Amending the Articles of Incorporation to allow majority shareholder written consent | ||||||
To Authorizing the Company name change to Meridian Waste Solutions, Inc
|
o | o | o | |||
To Amending the Articles of Incorporation to allow majority shareholder written consent, by adding the following new Article TENTH:
|
o | o | o | |||
“TENTH: Whenever the Corporation’s shareholders are required or permitted to take any action by vote, such action may be taken without a meeting on written consent, setting forth the action so taken, signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted.”
|
||||||
PROXY NUMBER:
|
||||||||||||||||||||
ACCOUNT NUMBER:
|
Successor
|
Predecessor | |||||||||||
September 30,
|
||||||||||||
2014
|
December 31, | |||||||||||
(UNAUDITED)
|
2013
|
2012
|
||||||||||
ASSETS
|
||||||||||||
Current Assets
|
||||||||||||
Cash
|
$ | 384,166 | $ | 1,461,372 | $ | 1,646,556 | ||||||
Accounts receivable, trade
|
689,716 | 440,570 | 343,962 | |||||||||
Employee advance
|
580 | 2,000 | - | |||||||||
Other receivables
|
75,000 | 202 | ||||||||||
Prepaid expenses
|
198,715 | 189,521 | 117,281 | |||||||||
Total Current Assets
|
1,273,177 | 2,168,463 | 2,108,001 | |||||||||
Property and Equipment, net of accumulated
|
||||||||||||
depreciation of $580,695, $7,780,233 and $6,364,005 respectively
|
7,583,214 | 4,810,603 | 4,137,649 | |||||||||
Other Assets
|
||||||||||||
Loan to member
|
50,000 | - | ||||||||||
Capitalized software
|
388,681 | - | - | |||||||||
Customer list, net of accumulated
|
||||||||||||
amortization of $1,167,288
|
12,840,164 | - | - | |||||||||
Deposits
|
8,303 | 8,303 | 8,303 | |||||||||
Loan fees, net of accumulated
|
||||||||||||
amortization of $7,030
|
43,583 | - | - | |||||||||
Non-compete, net of accumulated
|
||||||||||||
amortization of $12,500
|
137,500 | - | - | |||||||||
Total Other Assets
|
13,418,231 | 58,303 | 8,303 | |||||||||
TOTAL ASSETS
|
$ | 22,274,622 | $ | 7,037,369 | $ | 6,253,953 | ||||||
LIABILITIES & SHAREHOLDERS' EQUITY (DEFICIT)
|
||||||||||||
Liabilities
|
||||||||||||
Current Liabilities
|
||||||||||||
Accounts payable
|
$ | 306,966 | $ | 239,739 | $ | 161,660 | ||||||
Accrued expenses
|
305,719 | 94,620 | 69,595 | |||||||||
Convertible notes payable
|
568,146 | - | - | |||||||||
Deferred compensation
|
729,000 | - | - | |||||||||
Deferred revenue
|
1,993,062 | 1,910,465 | 1,744,578 | |||||||||
Notes due related parties
|
276,250 | - | - | |||||||||
Other current liabilities
|
910,555 | 50,000 | - | |||||||||
Current portion - long term debt
|
1,195,333 | 1,211,299 | 1,042,664 | |||||||||
Total Current Liabilities
|
6,285,031 | 3,506,123 | 3,018,497 | |||||||||
Long-term notes payable
|
||||||||||||
Less: current portion - long term debt
|
9,352,211 | 1,991,508 | 1,957,365 | |||||||||
Total Liabilities
|
15,637,242 | 5,497,631 | 4,975,862 | |||||||||
Shareholders' Equity (Deficit)
|
||||||||||||
Members' equity
|
- | 1,539,738 | 1,278,091 | |||||||||
Preferred stock
|
2,071 | - | - | |||||||||
Common stock
|
57,700 | - | - | |||||||||
Additional paid in capital
|
14,209,518 | - | - | |||||||||
Accumulated deficit
|
(7,631,909 | ) | - | - | ||||||||
Total Shareholders' Equity (Deficit)
|
6,637,380 | 1,539,738 | 1,278,091 | |||||||||
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY (DEFICIT)
|
$ | 22,274,622 | $ | 7,037,369 | $ | 6,253,953 |
Successor
|
Predecessor | |||||||||||||||
Period from
|
Period from
|
|||||||||||||||
Acquisition
|
January 1,
|
|||||||||||||||
May 16, 2014 to
|
2014
|
|||||||||||||||
September 30,
|
to May 15,
|
Year Ended | ||||||||||||||
2014
|
2014
|
December 31, | ||||||||||||||
UNAUDITED
|
UNAUDITED
|
2013
|
2012
|
|||||||||||||
Income
|
||||||||||||||||
Revenue
|
||||||||||||||||
Software sales
|
$ | 1,784 | $ | - | $ | - | $ | - | ||||||||
Services
|
4,827,855 | 4,246,558 | 11,349,872 | 10,249,774 | ||||||||||||
Total Revenue
|
4,829,639 | 4,246,558 | 11,349,872 | 10,249,774 | ||||||||||||
Cost of Sales/Services
|
||||||||||||||||
Cost of Sales/Services
|
3,153,111 | 2,671,187 | 6,968,847 | 5,978,694 | ||||||||||||
Depreciation
|
561,259 | 504,515 | 1,411,440 | 1,542,889 | ||||||||||||
Total Cost of Sales/Services
|
3,714,370 | 3,175,702 | 8,380,287 | 7,521,583 | ||||||||||||
Gross Profit
|
1,115,269 | 1,070,856 | 2,969,585 | 2,728,191 | ||||||||||||
Expenses
|
||||||||||||||||
Bad debt expense
|
13,280 | - | 42,508 | 17,951 | ||||||||||||
Bank, brokerage & credit card expense
|
23,813 | 30,527 | 52,634 | 45,082 | ||||||||||||
Charitable contributions
|
5,000 | 1,520 | 4,292 | 5,548 | ||||||||||||
Communication expense
|
42,448 | 30,938 | 89,126 | 91,038 | ||||||||||||
Compensation and related expense
|
567,108 | 240,894 | 703,688 | 572,761 | ||||||||||||
Depreciation and amortization
|
1,205,982 | 5,748 | 13,537 | 10,232 | ||||||||||||
Dues & subscriptions
|
450 | 57 | 2,229 | 2,676 | ||||||||||||
Information processing expense
|
22,218 | 9,799 | 20,887 | 25,465 | ||||||||||||
Insurance/bond expense
|
81,220 | 86,653 | 110,187 | 135,480 | ||||||||||||
Marketing expense
|
40,300 | 37,596 | 95,403 | 116,187 | ||||||||||||
Office expense
|
36,665 | 27,491 | 67,350 | 53,186 | ||||||||||||
Product development expense
|
- | - | - | - | ||||||||||||
Professional services
|
606,007 | 44,733 | 63,997 | 33,059 | ||||||||||||
Rent
|
98,348 | 126,936 | 249,793 | 134,778 | ||||||||||||
Repairs & maintenance
|
13,040 | 24,532 | 19,268 | 3,835 | ||||||||||||
State & local taxes, licenses, permits
|
4,320 | 9,365 | 17,595 | 26,311 | ||||||||||||
Travel & entertainment
|
27,353 | 28,157 | 34,127 | 37,442 | ||||||||||||
Total Expenses
|
2,787,552 | 704,946 | 1,586,621 | 1,311,031 | ||||||||||||
Other Income (Expenses):
|
||||||||||||||||
Miscellaneous income (loss)
|
- | - | 6,995 | 2,605 | ||||||||||||
Interest income
|
- | - | 1,004 | |||||||||||||
Gain (loss) on disposal of assets
|
- | - | (6,250 | ) | 15,134 | |||||||||||
Political contributions
|
- | - | (300 | ) | ||||||||||||
Loss on bad loans
|
- | - | (403 | ) | (110,006 | ) | ||||||||||
Interest expense
|
182,420 | 52,559 | (146,659 | ) | (159,964 | ) | ||||||||||
Total Other Expenses
|
182,420 | 52,559 | (146,317 | ) | (251,527 | ) | ||||||||||
Net Income (Loss) before income taxes
|
(1,854,703 | ) | 313,351 | 1,236,647 | 1,165,633 | |||||||||||
Income tax expense
|
- | - | - | - | ||||||||||||
Net Income (Loss)
|
$ | (1,854,703 | ) | $ | 313,351 | $ | 1,236,647 | $ | 1,165,633 | |||||||
Basic Net Loss Per Share
|
(0.04 | ) | ||||||||||||||
Weighted Average Number of Shares Outstanding
|
||||||||||||||||
(Basic and Diluted)
|
41,563,674 |
Common Shares
|
Common Stock, Par
|
Preferred Shares
|
Preferred Stock, Par
|
Additonal Paid in Capital
|
Members' Equity
|
Accumulated Deficit
|
Total
|
|||||||||||||||||||||||||
Predecessor
|
||||||||||||||||||||||||||||||||
Balance at December 31, 2011
|
$ | 1,192,458 | $ | 1,192,458 | ||||||||||||||||||||||||||||
Net income (loss)
|
1,165,633 | 1,165,633 | ||||||||||||||||||||||||||||||
Members' distributions
|
(1,080,000 | ) | (1,080,000 | ) | ||||||||||||||||||||||||||||
Balance at December 31, 2012
|
1,278,091 | 1,278,091 | ||||||||||||||||||||||||||||||
Net income (loss)
|
1,236,647 | 1,236,647 | ||||||||||||||||||||||||||||||
Members' distributions
|
(975,000 | ) | (975,000 | ) | ||||||||||||||||||||||||||||
Balance at December 31, 2013
|
1,539,738 | 1,539,738 | ||||||||||||||||||||||||||||||
UNAUDITED
|
||||||||||||||||||||||||||||||||
Net income, January 1, 2014 - May 15, 2014
|
313,351 | 313,351 | ||||||||||||||||||||||||||||||
Members' distributions, January 1, 2014 - May 15, 2014
|
(585,000 | ) | (585,000 | ) | ||||||||||||||||||||||||||||
Balance at May 15, 2014
|
$ | 1,268,089 | $ | 1,268,089 | ||||||||||||||||||||||||||||
Successor
|
||||||||||||||||||||||||||||||||
Balance at May 16, 2014
|
55,624,917 | $ | 55,625 | 2,071,210 | $ | 2,071 | $ | 13,879,593 | $ | (5,777,206 | ) | $ | 8,160,083 | |||||||||||||||||||
Common stock issued for services
|
2,075,000 | 2,075 | - | - | 329,925 | - | 332,000 | |||||||||||||||||||||||||
Net loss
|
(1,854,703 | ) | (1,854,703 | ) | ||||||||||||||||||||||||||||
Balance September 30, 2014
|
57,699,917 | $ | 57,700 | 2,071,210 | $ | 2,071 | $ | 14,209,518 | $ | (7,631,909 | ) | $ | 6,637,380 |
Successor
|
Predecessor | |||||||||||||||
Period from
|
Period from
|
|||||||||||||||
Acquisition
|
January 1,
|
|||||||||||||||
May 16, 2014 to
|
2014
|
|||||||||||||||
September 30,
|
to May 15,
|
Year Ended
|
||||||||||||||
2014
|
2014
|
December 31,
|
||||||||||||||
UNAUDITED
|
UNAUDITED
|
2013
|
2012
|
|||||||||||||
OPERATING ACTIVITIES
|
||||||||||||||||
Net income (loss) from operations
|
$ | (1,854,703 | ) | $ | 313,351 | $ | 1,236,647 | $ | 1,165,633 | |||||||
Adjustment to reconcile net loss to net cash used in operating activities:
|
||||||||||||||||
Depreciation & Amortization
|
1,767,240 | 510,263 | 1,424,979 | 1,553,121 | ||||||||||||
Stock issued to vendors for service
|
332,000 | - | - | - | ||||||||||||
Increase in deferred compensation
|
243,000 | - | - | - | ||||||||||||
(Gain) Loss on note conversions/sale of asset
|
- | - | 6,250 | (15,134 | ) | |||||||||||
Changes in working capital items:
|
||||||||||||||||
Accounts receivable
|
(57,394 | ) | (154,097 | ) | (96,609 | ) | (73,290 | ) | ||||||||
Employee advance/other receivables
|
(580 | ) | 400 | (126,798 | ) | 75,021 | ||||||||||
Prepaid expenses
|
7,242 | 65,976 | (72,240 | ) | (2,552 | ) | ||||||||||
Other current assets
|
- | - | - | 55,297 | ||||||||||||
Accounts payable & accrued expenses
|
445,128 | 89,309 | 103,102 | 98,054 | ||||||||||||
Deferred revenue
|
114,957 | (32,360 | ) | 165,887 | (56,854 | ) | ||||||||||
Other current liabilities
|
738,310 | - | 25,000 | - | ||||||||||||
Cash flow from operating activities
|
1,735,200 | 792,842 | 2,666,218 | 2,799,296 | ||||||||||||
INVESTING ACTIVITIES
|
||||||||||||||||
Proceeds from sale of fixed assets
|
12,415 | 53,622 | ||||||||||||||
Purchased capitalized software
|
(14,662 | ) | - | - | - | |||||||||||
Acquisition of subsidiary
|
123,841 | - | - | - | ||||||||||||
Purchased equipment
|
(1,053,289 | ) | (170,888 | ) | (2,058,359 | ) | (1,815,160 | ) | ||||||||
Purchased software
|
- | - | - | - | ||||||||||||
Cash flow from investing activities
|
(944,110 | ) | (170,888 | ) | (2,045,944 | ) | (1,761,538 | ) | ||||||||
FINANCING ACTIVITIES
|
||||||||||||||||
Member distributions
|
(585,000 | ) | (975,000 | ) | (1,080,000 | ) | ||||||||||
Loan from member
|
25,000 | - | ||||||||||||||
Principle payments on notes payable
|
(427,455 | ) | (449,498 | ) | (1,208,210 | ) | (1,151,370 | ) | ||||||||
Proceed from long-term notes payable
|
- | 1,352,752 | 1,626,941 | |||||||||||||
Cash flow from financing activities
|
(427,455 | ) | (1,034,498 | ) | (805,458 | ) | (604,429 | ) | ||||||||
Net change in cash
|
363,635 | (412,544 | ) | (185,184 | ) | 433,329 | ||||||||||
Beginning cash
|
20,531 | 1,461,372 | 1,646,556 | 1,213,227 | ||||||||||||
Ending Cash
|
$ | 384,166 | $ | 1,048,828 | $ | 1,461,372 | $ | 1,646,556 | ||||||||
Supplemental disclosure of cash flow information:
|
||||||||||||||||
Cash paid for income taxes
|
- | |||||||||||||||
Cash paid for interest
|
98,272 | |||||||||||||||
Supplemental Non-Cash Investing and Financing Information:
|
||||||||||||||||
Common stock issued in connection with debt conversions
|
- | |||||||||||||||
Common stock issued to employees and officers
|
- | |||||||||||||||
Common stock issued for services
|
332,000 | |||||||||||||||
Common stock issued to acquire software products
|
- | |||||||||||||||
Debt forgiveness former officer.
|
- | |||||||||||||||
Common stock issued in connection with acquisition
|
||||||||||||||||
of subsidiary
|
- | |||||||||||||||
Preferred stock issued in connection with acquisition
|
||||||||||||||||
of subsidiary
|
- |
Furniture & office equipment
|
$ | 334,265 | ||
Containers
|
2,837,315 | |||
Trucks
|
4,992,329 | |||
Total Property and Equipment
|
8,163,909 | |||
Less: Accumulated Depreciation
|
(580,695 | ) | ||
Net Property and Equipment
|
$ | 7,583,214 |
Cash | 11,500,000 | |||
Estimated value of common stock issued to sellers
|
1,978,750 | |||
Estimated value of preferred stock issued to sellers
|
7,121,000 | |||
$ | 20,599,750 |
Cash | $ | 500,000 | ||
Accounts receivable
|
632,322 | |||
Prepaid expenses
|
123,544 | |||
Deposits
|
8,303 | |||
Containers
|
2,710,671 | |||
Furniture and equipment
|
299,450 | |||
Trucks
|
4,100,500 | |||
Customer lists
|
14,007,452 | |||
Non-compete agreement
|
150,000 | |||
Accounts payable and accrued expenses
|
(54,387 | ) | ||
Deferred revenue
|
(1,878,105 | ) | ||
$ | 20,599,750 |
Description | 9/30/2014 | Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | ||||||||||||
Convertible promissory note with embedded conversion option | $ | 568,146 | $ | - | $ | - | $ | 568,146 | ||||||||
Total | $ | 568,146 | $ | - | $ | - | $ | 568,146 |
2014 | $ | 66,479 | ||
2015
|
271,915 | |||
2016
|
277,915 | |||
2017
|
283,915 | |||
Thereafter
|
- | |||
Total
|
900,224 |
FINANCIAL STATEMENTS
|
Page
|
||
Report of Independent Registered Public Accounting Firm
|
1
|
||
Balance Sheets
|
2
|
||
Statements of Income
|
4
|
||
Statements of Members' Equity
|
5
|
||
Statements of Cash Flows
|
6
|
||
Notes to Financial Statements
|
7 - 14
|
ASSETS | ||||||||
2013
|
2012
|
|||||||
CURRENT ASSETS
|
||||||||
Cash
|
$ | 1,461,372 | $ | 1,646,556 | ||||
Accounts receivable, less allowances for doubtful
|
440,569 | 343,962 | ||||||
accounts of $42,509 in 2013 and $0 in 2012 | ||||||||
Employee Advances
|
2,000 | - | ||||||
Note receivable - related party
|
75,000 | 202 | ||||||
Prepaid expenses
|
81,128 | 68,459 | ||||||
Prepaid insurance
|
108,393 | 48,822 | ||||||
Total Current Assets | 2,168,462 | 2,108,001 | ||||||
PROPERTY AND EQUIPMENT
|
||||||||
Equipment and fixtures
|
116,429 | 69,162 | ||||||
Furniture and fixtures
|
18,351 | 18,351 | ||||||
Containers, carts, and roll off
|
3,568,631 | 2,727,517 | ||||||
Vehicles
|
8,887,425 | 7,686,624 | ||||||
Total Property and Equipment | 12,590,836 | 10,501,654 | ||||||
Less: accumulated depreciation
|
7,780,233 | 6,364,005 | ||||||
Net Property and Equipment | 4,810,603 | 4,137,649 | ||||||
OTHER ASSETS
|
||||||||
Loan to member
|
50,000 | - | ||||||
Deposits
|
8,303 | 8,303 | ||||||
Total Other Assets | 58,303 | 8,303 | ||||||
TOTAL ASSETS
|
$ | 7,037,368 | $ | 6,253,953 |
LIABILITIES AND MEMBERS' EQUITY
|
||||||||
CURRENT LIABILITIES
|
||||||||
Accounts payable
|
$ | 239,739 | $ | 161,660 | ||||
Accrued payroll and payroll tax
|
94,620 | 69,595 | ||||||
Current portion of long-term liabilities
|
1,211,299 | 1,042,664 | ||||||
Deferred revenue
|
1,910,465 | 1,744,578 | ||||||
Deposit
|
25,000 | - | ||||||
Loan from member
|
25,000 | - | ||||||
Total Current Liabilities
|
3,506,123 | 3,018,497 | ||||||
LONG-TERM LIABILITIES
|
||||||||
Long-term liabilities, less current maturities
|
1,991,508 | 1,957,365 | ||||||
Total Liabilities
|
5,497,631 | 4,975,862 | ||||||
MEMBERS' EQUITY
|
1,539,737 | 1,278,091 | ||||||
Total Members' Equity
|
1,539,737 | 1,278,091 | ||||||
TOTAL LIABILITIES AND MEMBERS' EQUITY
|
$ | 7,037,368 | $ | 6,253,953 |
2013
|
2012
|
|||||||
Amount
|
Amount
|
|||||||
Service revenues
|
$ | 11,247,773 | $ | 10,076,570 | ||||
Recycling income
|
102,099 | 173,204 | ||||||
Total Income
|
11,349,872 | 10,249,774 | ||||||
Cost of Services
|
8,380,287 | 7,521,583 | ||||||
Gross Profit
|
2,969,585 | 2,728,191 | ||||||
General and Administrative Expenses
|
||||||||
Compensation and related expenses
|
703,688 | 612,578 | ||||||
Rent expense
|
249,793 | 134,778 | ||||||
Advertising expense
|
95,403 | 116,187 | ||||||
Depreciation expense
|
13,541 | 10,232 | ||||||
Other general and administrative expenses
|
524,197 | 437,256 | ||||||
Total General and Administrative Expenses
|
1,586,622 | 1,311,031 | ||||||
Income from Operations
|
1,382,963 | 1,417,160 | ||||||
Other Income (Expense)
|
||||||||
Miscellaneous income
|
6,995 | 2,605 | ||||||
Interest income
|
- | 1,004 | ||||||
Gain(Loss) on disposal of assets
|
(6,250 | ) | 15,134 | |||||
Political contributions
|
- | (300 | ) | |||||
Loss on bad loans
|
(403 | ) | (110,006 | ) | ||||
Interest expense
|
(146,659 | ) | (159,964 | ) | ||||
Total Other Income (Expense)
|
(146,317 | ) | (251,527 | ) | ||||
NET INCOME
|
$ | 1,236,646 | $ | 1,165,633 |
Members' Equity - December 31, 2011
|
$ | 1,192,458 | ||
Net Income
|
1,165,633 | |||
Shareholder Distributions
|
(1,080,000 | ) | ||
Members' Equity - December 31, 2012
|
1,278,091 | |||
Net Income
|
1,236,646 | |||
Shareholder Distributions
|
(975,000 | ) | ||
Members' Equity - December 31, 2013
|
$ | 1,539,737 |
2013
|
2012
|
|||||||
Cash Flows from Operating Activities
|
||||||||
Net income
|
$ | 1,236,646 | $ | 1,165,633 | ||||
Adjustments to reconcile net income to net cash
|
||||||||
provided by operating activities
|
||||||||
Allowance for doubtful accounts
|
42,509 | |||||||
Depreciation and amortization
|
1,424,979 | 1,553,121 | ||||||
Change in assets - (increase) decrease
|
||||||||
Accounts receivable
|
(139,117 | ) | (73,290 | ) | ||||
Other receivables
|
(76,798 | ) | 75,021 | |||||
Prepaid insurance
|
(59,571 | ) | 6,689 | |||||
Prepaid expenses
|
(12,669 | ) | (9,241 | ) | ||||
Loan to member
|
(50,000 | ) | ||||||
Letter of credit
|
- | 50,297 | ||||||
Deposits
|
- | 5,000 | ||||||
Gain/Loss on sale of asset
|
6,250 | (15,134 | ) | |||||
Change in liabilities - increase (decrease)
|
||||||||
Accounts payable
|
78,077 | 89,899 | ||||||
Accrued expenses
|
- | (9,203 | ) | |||||
Accrued payroll and payroll taxes
|
25,025 | 17,358 | ||||||
Deferred revenue
|
165,887 | (56,854 | ) | |||||
Deposit
|
25,000 | - | ||||||
Total Adjustments
|
1,429,572 | 1,633,663 | ||||||
Net Cash Provided by Operating Activities
|
2,666,218 | 2,799,296 | ||||||
Cash Flows from Investing Activities
|
||||||||
Proceeds from sale of fixed assets
|
12,415 | 53,622 | ||||||
Purchase of property and equipment
|
(705,607 | ) | (188,219 | ) | ||||
Net Cash Used in Investing Activities
|
(693,192 | ) | (134,597 | ) | ||||
Cash Flows from Financing Activities
|
||||||||
Member distributions
|
(975,000 | ) | (1,080,000 | ) | ||||
Loan from member
|
25,000 | |||||||
Principal payments on notes
|
(1,208,210 | ) | (1,151,370 | ) | ||||
Net Cash Used in Financing Activities
|
(2,158,210 | ) | (2,231,370 | ) | ||||
Net Increase (Decrease) in Cash
|
(185,184 | ) | 433,329 | |||||
Cash - Beginning of Year
|
1,646,556 | 1,213,227 | ||||||
Cash - End of Year
|
$ | 1,461,372 | $ | 1,646,556 |
2013
|
2012
|
|||||||
Customer A
|
31.58 | % | 34.72 | % | ||||
Customer B
|
21.08 | % | 23.11 | % | ||||
52.66 | % | 57.83 | % |
2013
|
2012
|
|||||||
0-30 days
|
$ | 398,767 | $ | 308,338 | ||||
31-60 days
|
19,796 | 17,813 | ||||||
61-90 days
|
7,836 | 5,680 | ||||||
Over 90 days
|
56,679 | 12,131 | ||||||
Allowance
|
(42,509 | ) | - | |||||
$ | 440,569 | $ | 343,962 |
2013
|
2012
|
|||||||
Advertising
|
$ | 50,492 | $ | 34,146 | ||||
Software support
|
7,240 | 5,320 | ||||||
Performance bonds
|
23,396 | 19,184 | ||||||
Rent
|
$ | - | $ | 9,809 | ||||
81,128 | 68,459 |
YEARS | ||
Trucks
|
5 years
|
|
Containers and carts | 7 years | |
Leasehold Improvements | 7-15 years | |
Furniture and equipment
|
5-7 years
|
|
Office equipment
|
3-7 years
|
2013
|
2012
|
|||||||
January
|
$ | 812,515 | $ | 735,865 | ||||
February
|
655,837 | 610,047 | ||||||
March
|
442,113 | 398,666 | ||||||
$ | 1,910,465 | $ | 1,744,578 |
2013
|
2012
|
|||||||
Labor costs
|
$ | 2,772,312 | $ | 2,514,803 | ||||
Landfill costs
|
1,541,692 | 1,228,786 | ||||||
Depreciation
|
1,411,438 | 1,542,889 | ||||||
Fuel costs
|
1,113,879 | 1,000,096 | ||||||
Repairs and maintenance
|
1,037,037 | 870,726 | ||||||
Vehicle insurance
|
164,331 | 83,281 | ||||||
Property taxes
|
147,046 | 130,881 | ||||||
Other direct costs
|
150,121 | |||||||
$ | 8,380,287 | $ | 7,521,583 |
2013
|
2012
|
|||||||
Notes payable in monthly installments to 1st Source Bank totaling $31,405, including interest at 6%, secured by equipment. Maturing from 2014 to 2016.
|
$ | 761,994 | $ | 1,082,162 | ||||
Note Payable to Ford Motor Credit, interest at 5%, monthly payments of $1,165, matures August 2015, secured by vehicle.
|
21,405 | 33,983 | ||||||
Note Payable to KIA Motors, interest at 4.9%, monthly payments of $401, matures August 2015, secured by a vehicle.
|
7,940 | 12,753 | ||||||
Notes Payable in monthly installments to TCF Equipment Finance totaling $41,755, including interest ranging from 4.42% to 4.67%, secured by equipment. Maturing from 2014 to 2017.
|
1,157,327 | 1,080,188 | ||||||
Notes Payable in monthly installments to Wells Fargo Equipment Finance, Inc. totaling $27,271, including interest ranging from 4.75% to 4.95%, secured by equipment. Maturing from 2014 to 2017. | 733,090 | 537,587 | ||||||
Notes Payable in monthly installments to US Bank Equipment Finance totaling $14,490, including interest ranging from 4.25% to 5.25%, secured by equipment. Maturing from 2016 to 2017.
|
521,051 | 253,356 | ||||||
TOTAL DEBT | 3,202,807 | 3,000,029 | ||||||
Less current maturities | 1,211,299 | 1,042,664 | ||||||
TOTAL LONG-TERM DEBT | $ | 1,991,508 | $ | 1,957,365 |
2014
|
$ | 1,211,299 | ||
2015
|
1,129,965 | |||
2016
|
671,948 | |||
2017
|
189,595 | |||
Thereafter
|
- | |||
TOTAL DEBT
|
$ | 3,202,807 |
|
As of December 31, 2013, the Company had a demand note receivable with an outstanding balance of $75,000 from BRK Holding LLC which is owned by the Company’s members.
|
|
As of December 31, 2013, the Company had a demand note receivable with an outstanding balance of $50,000 from J. Reich, a member of the Company.
|
|
In September of 2013, C. Barcom, an officer of the Company, made a loan to the Company of $25,000. Repayment is due upon demand.
|
2014
|
$ | 265,915 | ||
2015
|
271,915 | |||
2016
|
277,915 | |||
2017
|
283,915 | |||
Thereafter
|
- | |||
TOTAL
|
$ | 1,099,660 |
|
Operating activities reflect interest paid of $146,659 and $159,964 during 2013 and 2012, respectively.
|
|
Noncash investing and financing activity during 2013 and 2012:
|
2013
|
2012
|
|||||||
Acquisition of equipment
|
||||||||
Cost of equipment
|
$ | 2,058,359 | $ | 1,815,160 | ||||
Less notes payable
|
1,352,752 | 1,626,941 | ||||||
Cash payments for equipment
|
$ | 705,607 | $ | 188,219 |
|
The Company has evaluated subsequent events through July 16, 2014, the date the financial statements were available to be issued.
|
|
On May 15, 2014 the Company signed an asset purchase agreement with Here To Serve – Missouri Waste Division, LLC, a Missouri limited liability company. A down payment has been received in the amount of $25,000 which is recorded as a current liability on the Company’s books.
|
September 30,
2013
|
September 30,
2012
|
|||||||
ASSETS
|
||||||||
Current Assets
|
||||||||
Cash
|
$ | 495 | $ | 9,615 | ||||
Advances To Officers
|
- | 17,254 | ||||||
Total Current Assets
|
495 | 26,869 | ||||||
Property and Equipment, net of accumulated depreciation
|
||||||||
of $7,090 and $4,389, respectively
|
- | 2,701 | ||||||
Other Assets
|
||||||||
Capitalized Software
|
279,608 | - | ||||||
Purchased Software, net of accumulated
|
||||||||
amortization of $0 and $19,814, respectively.
|
- | 2,414 | ||||||
Total Other Assets
|
279,608 | 2,414 | ||||||
TOTAL ASSETS
|
$ | 280,103 | $ | 31,984 | ||||
LIABILITIES & SHAREHOLDERS' DEFICIT
|
||||||||
Liabilities
|
||||||||
Current Liabilities
|
||||||||
Accounts Payable
|
$ | 442 | $ | 10,691 | ||||
Accrued Salaries
|
- | 66,300 | ||||||
Convertible Notes Payable
|
578,306 | 616,767 | ||||||
Accrued Interest Payable
|
166,619 | 92,988 | ||||||
Notes due related parties
|
550,929 | 334,262 | ||||||
Other Current Liabilities
|
14,208 | 2,519 | ||||||
Total Current Liabilities
|
1,310,504 | 1,123,527 | ||||||
Shareholders' Deficit
|
||||||||
Preferred Stock - Par Value $.001,Authorized 2,000,000, Outstanding 2,000,000 and 2,000,000, respectively
|
2,000 | 2,000 | ||||||
Common Stock - Par Value $0.001, Authorized 400,000,000, Outstanding 25,020,704 and 4,863,495, respectively
|
25,021 | 4,864 | ||||||
Additional Paid iIn Capital
|
2,728,977 | 2,489,087 | ||||||
Accumulated Deficit
|
(3,786,399 | ) | (3,587,494 | ) | ||||
Total Shareholder's Deficit
|
(1,030,401 | ) | (1,091,543 | ) | ||||
TOTAL LIABILITIES & SHAREHOLDERS' DEFICIT
|
$ | 280,103 | $ | 31,984 |
Income
|
2013
|
2012
|
||||||
Revenue
|
||||||||
Software sales
|
$ | 6,128 | $ | 21,966 | ||||
Consulting services
|
38,624 | 69,900 | ||||||
Other income
|
3,267 | 326 | ||||||
Total Revenue
|
48,019 | 92,192 | ||||||
Expense
|
||||||||
Compensation and Related Expense
|
21,139 | 230,712 | ||||||
Depreciation and Amortization
|
9,571 | 97,807 | ||||||
Branch Office Expense
|
- | 8,096 | ||||||
Professional Services
|
8,330 | 45,078 | ||||||
Information Processing Expense
|
12,801 | 37,223 | ||||||
Marketing Expense
|
15,904 | 18,639 | ||||||
Bank, Brokerage, and Credit Card Expense
|
3,219 | 6,070 | ||||||
Impairment Expense
|
- | 214,440 | ||||||
Product Development Expense
|
50,290 | 1,781 | ||||||
Communication Expense
|
4,131 | 4,601 | ||||||
State & Local Taxes
|
1,698 | 2,435 | ||||||
Travel & Entertainment
|
24 | 5,395 | ||||||
Dues and Subscriptions
|
316 | 2,328 | ||||||
Miscellaneous expenses
|
- | 2,764 | ||||||
Bad Debts
|
- | 34,675 | ||||||
Total Expenses
|
127,423 | 712,044 | ||||||
Loss From Operations
|
(79,404 | ) | (619,852 | ) | ||||
Other Expenses
|
||||||||
Loss on Note Conversions
|
- | 61,141 | ||||||
Interest Expense
|
119,501 | 89,794 | ||||||
Loss on Sale of Marketable Securities
|
- | 5,703 | ||||||
119,501 | 156,638 | |||||||
Net Loss before income taxes
|
$ | (198,905 | ) | $ | (776,490 | ) | ||
Income tax expense
|
- | - | ||||||
Net Loss
|
(198,905 | ) | (776,490 | ) | ||||
Basic and Diluted Net Loss Per Share
|
$ | (0.02 | ) | $ | (0.31 | ) | ||
Weighted Average Number Of Shares Outstanding (Basic and Diluted)
|
11,496,462 | 2,515,516 |
Common Shares
|
Common Stock, Par
|
Preferred Shares
|
Preferred Stock, Par
|
Additonal Paid in Capital
|
Accumulated Deficit
|
Total
|
||||||||||||||||||||||
Balance September 30, 2011
|
906,724 | $ | 907 | 2,000,000 | $ | 2,000 | $ | 1,378,337 | $ | (2,811,004 | ) | $ | (1,429,760 | ) | ||||||||||||||
Common stock issued in connection with debt conversions
|
1,859,271 | 1,859 | - | - | 398,697 | - | 400,556 | |||||||||||||||||||||
Common stock issued to employees and officers
|
150,000 | 150 | - | - | 119,850 | - | 120,000 | |||||||||||||||||||||
Common stock issued to vendors for settlement of accounts payable
|
20,000 | 20 | - | - | 7,680 | - | 7,700 | |||||||||||||||||||||
Common stock issued for cash
|
1,927,500 | 1,928 | - | - | 188,573 | - | 190,501 | |||||||||||||||||||||
Accrued salaries forgiven- former officer
|
- | - | - | - | 395,950 | - | 395,950 | |||||||||||||||||||||
Net loss
|
- | - | - | - | - | (776,490 | ) | (776,490 | ) | |||||||||||||||||||
Balance September 30, 2012
|
4,863,495 | $ | 4,864 | 2,000,000 | $ | 2,000 | $ | 2,489,087 | $ | (3,587,494 | ) | $ | (1,091,543 | ) | ||||||||||||||
Common stock issued in connection with debt conversions
|
1,121,500 | 1,121 | - | - | 41,545 | - | 42,666 | |||||||||||||||||||||
Common stock issued to employees and officers
|
13,100,000 | 13,100 | - | - | 55,200 | - | 68,300 | |||||||||||||||||||||
Common stock issued to vendors for settlement of accounts payable
|
500,000 | 500 | - | - | 9,500 | - | 10,000 | |||||||||||||||||||||
Common stock issued to acquire software products
|
4,285,714 | 4,286 | - | - | 92,743 | - | 97,029 | |||||||||||||||||||||
Common stock issued for cash
|
1,150,000 | 1,150 | - | - | 16,350 | - | 17,500 | |||||||||||||||||||||
Accrued expenses forgiven- former officer
|
- | - | - | - | 24,552 | - | 24,552 | |||||||||||||||||||||
Fractional shares cancelled due to reverse stock split
|
(5 | ) | - | - | - | - | - | - | ||||||||||||||||||||
Net loss
|
- | - | - | - | - | (198,905 | ) | (198,905 | ) | |||||||||||||||||||
Balance September 30, 2013
|
25,020,704 | $ | 25,021 | 2,000,000 | $ | 2,000 | $ | 2,728,977 | $ | (3,786,399 | ) | $ | (1,030,401 | ) |
2013
|
2012
|
|||||||
OPERATING ACTIVITIES
|
||||||||
Net loss from operations
|
$ | (198,905 | ) | $ | (776,490 | ) | ||
Adjustment to reconcile net loss to net cash used in operating activities:
|
||||||||
Depreciation & Amortization
|
9,571 | 97,807 | ||||||
Stock issued to vendors for service
|
10,000 | 7,700 | ||||||
Stock based compensation
|
2,000 | 120,000 | ||||||
Premium Expense
|
41,666 | 11,846 | ||||||
Loss on note conversions
|
- | 61,141 | ||||||
Impairment Expense
|
- | 214,440 | ||||||
Note for services
|
- | 20,000 | ||||||
Loss on sale of marketable securities
|
- | 5,703 | ||||||
Bad debt expense
|
- | 34,675 | ||||||
Changes in working capital items:
|
||||||||
Accounts payable
|
14,053 | 1,634 | ||||||
Accounts receivable
|
- | (3,175 | ) | |||||
Advances to officers
|
17,254 | (17,254 | ) | |||||
Other current liabilities
|
11,689 | 1,339 | ||||||
Accrued interest payable
|
73,631 | 79,244 | ||||||
Cash flow from operating activities
|
$ | (19,041 | ) | $ | (141,390 | ) | ||
INVESTING ACTIVITIES
|
||||||||
Proceeds from sale of marketable securities
|
- | 19,297 | ||||||
Purchased capitalized software
|
- | (76,914 | ) | |||||
Purchased equipment
|
- | (795 | ) | |||||
Purchased software
|
(7,579 | ) | (44 | ) | ||||
Cash flow from investing activities
|
$ | (7,579 | ) | $ | (58,456 | ) | ||
FINANCING ACTIVITIES
|
||||||||
Proceeds from common stock sold
|
17,500 | 190,501 | ||||||
Related party loans
|
- | - | ||||||
Cash Contributed Officer
|
- | - | ||||||
Cash flow from financing activities
|
$ | 17,500 | $ | 190,501 | ||||
Net change in cash
|
(9,120 | ) | (9,345 | ) | ||||
Beginning cash
|
9,615 | 18,960 | ||||||
Ending Cash
|
$ | 495 | $ | 9,615 | ||||
Supplemental disclosure of cash flow information:
|
||||||||
Cash paid for income taxes
|
- | - | ||||||
Cash paid for interest
|
- | - | ||||||
Supplemental Non-Cash Investing and Financing Information:
|
||||||||
Common stock issued in connection with debt conversions
|
41,544 | 339,416 | ||||||
Common stock issued to employees and officers
|
66,300 | - | ||||||
Common stock issued to vendors for settlement of accounts payable
|
- | - | ||||||
Common stock issued to acquire software products
|
97,029 | - | ||||||
Debt forgiveness former officer.
|
24,553 | 395,950 |
2013
|
2012
|
|||||||
Equipment
|
$ | 7,090 | $ | 7,090 | ||||
Total Equipment
|
7,090 | 7,090 | ||||||
Less: Accumulated Depreciation
|
$ | (7,090 | ) | $ | (4,389 | ) | ||
Equipment, net
|
$ | - | $ | 2,701 | ||||
Purchased Software
|
$ | 22,228 | $ | 22,228 | ||||
Total Purchased Software
|
22,228 | 22,228 | ||||||
Less: Accumulated Amortization
|
$ | (22,228 | ) | $ | (19,814 | ) | ||
Purchased Software, net
|
$ | - | $ | 2,414 |
2013
|
2012
|
|||||||
Computed "expected" expense (benefit)
|
(35 | ) % | (35 | ) % | ||||
State tax expense (benefit), net of federal effect
|
(5 | ) % | (5 | ) % | ||||
Stock based compensation
|
2 | % | 6 | % | ||||
Convertible note premium and losses
|
7 | % | 4 | % | ||||
Increase in valuation allowance
|
31 | % | 30 | % |
Deferred tax assets:
|
2013
|
2012
|
||||||
Net operating loss carry forward
|
848,000 | 790,000 | ||||||
Total deferred tax asset
|
848,000 | 790,000 | ||||||
Less: valuation allowance
|
(848,000 | ) | (790,000 | ) | ||||
Net deferred tax asset
|
- | - |
Debit
|
Credit
|
|||||||
Employee advance
|
$ | - | $ | 2,000 | ||||
Property & equipment, net
|
4,810,603 | |||||||
Property & equipment, net
|
7,420,348 | |||||||
Intangible assets, net
|
14,233,065 | |||||||
Deposits
|
38,300 | |||||||
Notes payable related party
|
1,475,000 | |||||||
Other current liabilities
|
25,000 | |||||||
Other current liabilities
|
70,325 | |||||||
Current portion - long term debt
|
1,211,299 | |||||||
Current portion - long term debt
|
1,225,000 | |||||||
Notes payable
|
1,225,000 | |||||||
Notes payable
|
1,991,508 | |||||||
Notes payable
|
9,500,000 | |||||||
Series B convertible preferred stock
|
71 | |||||||
Common stock
|
13,192 | |||||||
Additional paid in capital
|
1,539,737 | |||||||
Additional paid in capital
|
9,086,487 | |||||||
Cost of sales/services - depreciation
|
1,411,438 | |||||||
Depreciation & amortization
|
13,541 | |||||||
Depreciation & amortization
|
2,801,490 | |||||||
Depreciation & amortization
|
16,871 | |||||||
Depreciation & amortization
|
30,000 | |||||||
Intangible assets, net
|
2,848,361 | |||||||
Depreciation & amortization
|
12,476 | |||||||
Cost of sales/services - depreciation
|
1,300,408 | |||||||
Property & equipment, net
|
1,312,884 | |||||||
$ | 31,807,202 | $ | 31,807,202 | |||||
(b) to record impact of merger with Brooklyn Cheescake & Desserts Company, Inc.
|
||||||||
Cash
|
$ | - | $ | 1,078 | ||||
Accounts receivable, related party
|
47,725 | |||||||
Intangible assets, net
|
19,125 | |||||||
Accounts payable & accrued expenses
|
24,340 | |||||||
Notes payable - related party
|
94,744 | |||||||
Accumulated earnings (deficit)
|
40,873 | |||||||
Licensing fee - related party
|
13,375 | |||||||
Sales, general & administrative expense
|
23,658 | |||||||
Treasury stock
|
300,000 | |||||||
Cash
|
150,000 | |||||||
Notes payable - related party
|
150,000 | |||||||
$ | 432,459 | $ | 432,459 |
Pro Forma Adjustments
|
||||||||||||||||||||||||
HTSHC
|
MWD
|
BCKE
|
Debit
|
Credit
|
Pro Forma
|
|||||||||||||||||||
Current Assets:
|
||||||||||||||||||||||||
Cash
|
$ | 9,760 | $ | 1,461,372 | $ | 1,078 | $ | - | $ | 151,078 | $ | 1,321,132 | ||||||||||||
Accounts receivable, trade
|
440,569 | 440,569 | ||||||||||||||||||||||
Accounts receivable, related party
|
125,000 | 47,725 | 47,725 | 125,000 | ||||||||||||||||||||
Employee advance
|
2,000 | 2,000 | - | |||||||||||||||||||||
Prepaid expenses
|
189,521 | 189,521 | ||||||||||||||||||||||
Total current assets
|
9,760 | 2,218,462 | 48,803 | - | 200,803 | 2,076,222 | ||||||||||||||||||
Other Assets:
|
||||||||||||||||||||||||
Property & equipment, net
|
957 | 4,810,603 | 7,420,348 | 6,123,487 | 6,108,421 | |||||||||||||||||||
Capitalized software
|
298,287 | 298,287 | ||||||||||||||||||||||
Intangible assets, net
|
19,125 | 14,233,065 | 2,867,486 | 11,384,704 | ||||||||||||||||||||
Deposits
|
38,300 | 8,303 | 38,300 | 8,303 | ||||||||||||||||||||
Total assets
|
$ | 347,304 | $ | 7,037,368 | $ | 67,928 | $ | 21,653,413 | $ | 9,230,076 | $ | 19,875,937 | ||||||||||||
Current Liabilities:
|
||||||||||||||||||||||||
Accounts payable & accrued expenses
|
$ | 204,749 | $ | 334,359 | $ | 24,340 | $ | 24,340 | $ | - | $ | 539,108 | ||||||||||||
Notes payable - related party
|
569,262 | 25,000 | 94,744 | 94,744 | 1,625,000 | 2,219,262 | ||||||||||||||||||
Convertible notes payable
|
489,074 | 489,074 | ||||||||||||||||||||||
Deferred revenue
|
1,910,465 | 1,910,465 | ||||||||||||||||||||||
Deferred compensation
|
243,000 | 243,000 | ||||||||||||||||||||||
Other current liabilities
|
25,000 | 25,000 | 70,325 | 70,325 | ||||||||||||||||||||
Current portion - long term debt
|
1,211,299 | 1,211,299 | 1,225,000 | 1,225,000 | ||||||||||||||||||||
Total current liabilities
|
1,506,085 | 3,506,123 | 119,084 | 1,355,383 | 2,920,325 | 6,696,234 | ||||||||||||||||||
Long-Term Liabilities:
|
||||||||||||||||||||||||
Notes payable
|
1,991,508 | 3,216,508 | 9,500,000 | 8,275,000 | ||||||||||||||||||||
Total liabilities
|
$ | 1,506,085 | $ | 5,497,631 | $ | 119,084 | $ | 4,571,891 | $ | 12,420,325 | $ | 14,971,234 | ||||||||||||
Stockholders' Equity (Deficit):
|
||||||||||||||||||||||||
Series A convertible preferred stock
|
||||||||||||||||||||||||
($.001 parvalue; 2,000,000 shares authorized;
|
||||||||||||||||||||||||
2,000,000 shares issued & outstanding)
|
$ | 2,000 | $ | - | $ | - | $ | - | $ | - | $ | 2,000 | ||||||||||||
Series B convertible preferred stock
|
||||||||||||||||||||||||
($.001 parvalue; 71,210 shares authorized;
|
||||||||||||||||||||||||
71,208 shares issued & outstanding)
|
71 | 71 | ||||||||||||||||||||||
Common stock
|
||||||||||||||||||||||||
($.001 parvalue; 400,000,000 shares authorized;
|
||||||||||||||||||||||||
57,699,917 shares issued & outstanding)
|
36,457 | 28,482 | 13,192 | 78,131 | ||||||||||||||||||||
Treasury stock
|
300,000 | (300,000 | ) | |||||||||||||||||||||
Additional paid in capital
|
4,217,282 | 1,539,737 | 13,585,672 | 1,539,737 | 9,086,487 | 26,889,441 | ||||||||||||||||||
Accumulated earnings (deficit)
|
(5,414,520 | ) | (13,665,310 | ) | 4,174,620 | 1,489,510 | (21,764,940 | ) | ||||||||||||||||
Total shareholders' equity (deficit)
|
(1,158,781 | ) | 1,539,737 | (51,156 | ) | 6,014,357 | 10,589,260 | 4,904,703 | ||||||||||||||||
Total Liabilities & Stockholders Equity (Deficit)
|
$ | 347,304 | $ | 7,037,368 | $ | 67,928 | $ | 10,586,248 | $ | 23,009,585 | $ | 19,875,937 |
Pro Forma Adjustments
|
||||||||||||||||||||||||
HTSHC
|
MWD
|
BCKE
|
Debit
|
Credit
|
Pro Forma
|
|||||||||||||||||||
Revenue:
|
||||||||||||||||||||||||
Sales
|
$ | 406 | $ | - | $ | - | $ | - | $ | - | $ | 406 | ||||||||||||
Services
|
11,349,872 | 11,349,872 | ||||||||||||||||||||||
Licensing fee - related party
|
13,375 | 13,375 | - | |||||||||||||||||||||
Total revenue
|
406 | 11,349,872 | 13,375 | 13,375 | - | 11,350,278 | ||||||||||||||||||
Cost of Sales/Services
|
- | |||||||||||||||||||||||
Cost of Sales/Services
|
6,968,849 | 6,968,849 | ||||||||||||||||||||||
Depreciation
|
1,411,438 | 1,300,408 | 1,411,438 | 1,300,408 | ||||||||||||||||||||
Total cost of sales/services
|
- | 8,380,287 | - | 1,300,408 | 1,411,438 | 8,269,257 | ||||||||||||||||||
Gross profit
|
406 | 2,969,585 | 13,375 | 1,313,783 | 1,411,438 | 3,081,021 | ||||||||||||||||||
Operating expenses:
|
||||||||||||||||||||||||
Sales, general & adminstrative expense
|
1,554,647 | 1,573,484 | 23,658 | 23,658 | 3,128,131 | |||||||||||||||||||
Depreciation & amortization
|
136 | 13,541 | 2,860,837 | 13,541 | 2,860,973 | |||||||||||||||||||
Total operating expenses
|
1,554,783 | 1,587,025 | 23,658 | 2,860,837 | 37,199 | 5,989,104 | ||||||||||||||||||
Income (Loss) from Operations
|
(1,554,377 | ) | 1,382,560 | (10,283 | ) | 4,174,620 | 1,448,637 | (2,908,083 | ) | |||||||||||||||
Other Income (Expense):
|
||||||||||||||||||||||||
Miscellaneous income
|
6,995 | 6,995 | ||||||||||||||||||||||
Gain (loss) on disposal of assets
|
- | (6,250 | ) | (6,250 | ) | |||||||||||||||||||
Gain (loss) on note conversion
|
(23,913 | ) | (23,913 | ) | ||||||||||||||||||||
Interest (expense)
|
(59,831 | ) | (146,659 | ) | (206,490 | ) | ||||||||||||||||||
Total other income (expense)
|
(83,744 | ) | (145,914 | ) | - | - | - | (229,658 | ) | |||||||||||||||
Net Income (Loss)
|
$ | (1,638,121 | ) | $ | 1,236,646 | $ | (10,283 | ) | $ | 4,174,620 | $ | 1,448,637 | $ | (3,137,741 | ) |
depreciation:
|
||||||||||||
actual, 2 months ending 06/30/2014
|
218,814 | |||||||||||
12 months
|
1,312,884 | |||||||||||
admin
|
12,476 | |||||||||||
cos
|
1,300,408 | |||||||||||
amortization:
|
||||||||||||
customer list - 5 years
|
14,007,452 | 2,801,490 | ||||||||||
finance charges - 3 years
|
50,613 | 16,871 | ||||||||||
non-compete - 5 years
|
150,000 | 30,000 | 2,848,361 | |||||||||
4,161,245 |
Debit
|
Credit
|
|||||||
Depreciation & amortization
|
$ | - | $ | 17,028 | ||||
Cost of sales/services - depreciation
|
$ | 486,972 | ||||||
Depreciation & amortization
|
1,400,745 | |||||||
Depreciation & amortization
|
8,436 | |||||||
Depreciation & amortization
|
15,000 | |||||||
Intangible assets, net
|
1,424,181 | |||||||
Depreciation & amortization
|
21,390 | |||||||
Cost of sales/services - depreciation
|
635,052 | |||||||
Property & equipment, net
|
152,442 | |||||||
$ | 2,080,623 | $ | 2,080,623 | |||||
(b) to record impact of merger with Brooklyn Cheescake & Desserts Company, Inc.
|
||||||||
Cash
|
$ | - | $ | 1,078 | ||||
Accounts receivable, related party
|
54,403 | |||||||
Intangible assets, net
|
16,125 | |||||||
Accounts payable & accrued expenses
|
21,464 | |||||||
Notes payable - related party
|
105,105 | |||||||
Accumulated earnings (deficit)
|
51,156 | |||||||
Licensing fee - related party
|
6,678 | |||||||
Sales, general & administrative expense
|
10,485 | |||||||
$ | 133,247 | $ | 133,247 |
Pro Forma Adjustments
|
||||||||||||||||||||||||
HTSHC
|
MWD
|
BCKE
|
Debit
|
Credit
|
Pro Forma
|
|||||||||||||||||||
Current Assets:
|
||||||||||||||||||||||||
Cash
|
$ | 384,166 | $ | 1,078 | $ | - | $ | 1,078 | $ | 384,166 | ||||||||||||||
Accounts receivable, trade
|
689,716 | 689,716 | ||||||||||||||||||||||
Accounts receivable, related party
|
54,403 | 54,403 | - | |||||||||||||||||||||
Employee advance
|
580 | 580 | ||||||||||||||||||||||
Prepaid expenses
|
198,715 | 198,715 | ||||||||||||||||||||||
Total current assets
|
1,273,177 | - | 55,481 | - | 55,481 | 1,273,177 | ||||||||||||||||||
Other Assets:
|
||||||||||||||||||||||||
Property & equipment, net
|
7,583,214 | 152,442 | 7,430,772 | |||||||||||||||||||||
Capitalized software
|
388,681 | 388,681 | ||||||||||||||||||||||
Intangible assets, net
|
13,021,247 | 16,125 | 1,440,306 | 11,597,066 | ||||||||||||||||||||
Deposits
|
8,303 | 8,303 | ||||||||||||||||||||||
Total assets
|
$ | 22,274,622 | $ | - | $ | 71,606 | $ | - | $ | 1,648,229 | $ | 20,697,999 | ||||||||||||
Current Liabilities:
|
||||||||||||||||||||||||
Accounts payable & accrued expenses
|
$ | 612,685 | $ | - | $ | 21,464 | $ | 21,464 | $ | - | $ | 612,685 | ||||||||||||
Notes payable - related party
|
276,250 | 105,105 | 105,105 | 276,250 | ||||||||||||||||||||
Convertible notes payable
|
568,146 | 568,146 | ||||||||||||||||||||||
Deferred revenue
|
1,993,062 | 1,993,062 | ||||||||||||||||||||||
Other current liabilities
|
1,639,555 | 1,639,555 | ||||||||||||||||||||||
Current portion - long term debt
|
1,195,333 | 1,195,333 | ||||||||||||||||||||||
Total current liabilities
|
6,285,031 | - | 126,569 | 126,569 | - | 6,285,031 | ||||||||||||||||||
Long-Term Liabilities:
|
||||||||||||||||||||||||
Notes payable
|
9,352,211 | 9,352,211 | ||||||||||||||||||||||
Total liabilities
|
$ | 15,637,242 | $ | - | $ | 126,569 | $ | 126,569 | $ | - | $ | 15,637,242 | ||||||||||||
Stockholders' Equity (Deficit):
|
||||||||||||||||||||||||
Series A convertible preferred stock
|
||||||||||||||||||||||||
($.001 parvalue; 2,000,000 shares authorized;
|
||||||||||||||||||||||||
2,000,000 shares issued & outstanding)
|
$ | 2,000 | $ | - | $ | - | $ | - | $ | - | $ | 2,000 | ||||||||||||
Series B convertible preferred stock
|
||||||||||||||||||||||||
($.001 parvalue; 71,210 shares authorized;
|
||||||||||||||||||||||||
71,210 shares issued & outstanding)
|
71 | 71 | ||||||||||||||||||||||
Common stock
|
||||||||||||||||||||||||
($.001 parvalue; 400,000,000 shares authorized;
|
||||||||||||||||||||||||
57,699,917 shares issued & outstanding)
|
57,700 | 28,482 | 86,182 | |||||||||||||||||||||
Additional paid in capital
|
14,209,518 | 13,585,672 | 27,795,190 | |||||||||||||||||||||
Accumulated earnings (deficit)
|
(7,631,909 | ) | (13,669,117 | ) | 2,087,301 | 565,641 | (22,822,686 | ) | ||||||||||||||||
Total shareholders' equity (deficit)
|
6,637,380 | - | (54,963 | ) | 2,087,301 | 565,641 | 5,060,757 | |||||||||||||||||
Total Liabilities & Stockholders Equity (Deficit)
|
$ | 22,274,622 | $ | - | $ | 71,606 | $ | 2,213,870 | $ | 565,641 | $ | 20,697,999 |
Pro Forma Adjustments
|
||||||||||||||||||||||||
HTSHC
|
MWD
|
BCKE
|
Debit
|
Credit
|
Pro Forma
|
|||||||||||||||||||
Revenue:
|
||||||||||||||||||||||||
Sales
|
$ | 1,784 | $ | - | $ | 1,784 | ||||||||||||||||||
Services
|
4,827,855 | 4,251,674 | 9,079,529 | |||||||||||||||||||||
Licensing fee - related party
|
6,678 | 6,678 | - | |||||||||||||||||||||
Total revenue
|
4,829,639 | 4,251,674 | 6,678 | 6,678 | - | 9,081,313 | ||||||||||||||||||
Cost of Sales/Services
|
||||||||||||||||||||||||
Cost of Sales/Services
|
3,153,111 | 2,524,064 | 5,677,175 | |||||||||||||||||||||
Depreciation
|
561,259 | 486,972 | 635,052 | 486,972 | 1,196,311 | |||||||||||||||||||
Total cost of sales/services
|
3,714,370 | 3,011,036 | - | 635,052 | 486,972 | 6,873,486 | ||||||||||||||||||
Gross profit
|
1,115,269 | 1,240,638 | 6,678 | 641,730 | 486,972 | 2,207,827 | ||||||||||||||||||
Operating expenses:
|
||||||||||||||||||||||||
Sales, general & adminstrative expense
|
1,581,570 | 690,383 | 10,485 | 10,485 | 2,271,953 | |||||||||||||||||||
Depreciation & amortization
|
1,205,982 | 17,028 | 1,445,571 | 17,028 | 2,651,553 | |||||||||||||||||||
Total operating expenses
|
2,787,552 | 707,411 | 10,485 | 1,445,571 | 27,513 | 4,923,506 | ||||||||||||||||||
Income (Loss) from Operations
|
(1,672,283 | ) | 533,227 | (3,807 | ) | 2,087,301 | 514,485 | (2,715,679 | ) | |||||||||||||||
Other Income (Expense):
|
||||||||||||||||||||||||
Interest expense
|
(182,420 | ) | (183,205 | ) | (365,625 | ) | ||||||||||||||||||
Total other income (expense)
|
(182,420 | ) | (183,205 | ) | - | - | - | (365,625 | ) | |||||||||||||||
Net Income (Loss)
|
$ | (1,854,703 | ) | $ | 350,022 | $ | (3,807 | ) | $ | 2,087,301 | $ | 514,485 | $ | (3,081,304 | ) |
depreciation:
|
||||||||||||||||
actual, 2 months ending 06/30/2014
|
218,814 | |||||||||||||||
6 months
|
656,442 | |||||||||||||||
admin
|
21390 | |||||||||||||||
cos
|
635,052 | |||||||||||||||
amortization:
|
||||||||||||||||
customer list - 5 years
|
14,007,452 | 1,400,745 | 466915.1 | |||||||||||||
finance charges - 3 years
|
50,613 | 8,436 | 2811.833 | |||||||||||||
non-compete - 5 years
|
150,000 | 15,000 | 5000 | |||||||||||||
2,080,623 | 474726.9 |
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