Attached files
| file | filename |
|---|---|
| 8-K/A - Beyond Commerce, Inc. | v195782_8ka.htm |
| EX-99.3 - Beyond Commerce, Inc. | v195782_ex99-3.htm |
| EX-99.1 - Beyond Commerce, Inc. | v195782_ex99-1.htm |
EXHIBIT
99.2
EX-99.2
Unaudited interim balance sheets of Adjuice, Inc. as of March 31, 2010 and
December 31, 2009 and the related unaudited interim statements of income and
cash flows for Adjuice, Inc. for the three-months ended March 31, 2010 and
2009.
ADJUICE, INC.
Financial
Statements
For
the three month periods ended March 31, 2010 and 2009
|
Financial
Statements
|
||
|
Balance
Sheet
|
F4
|
|
|
Statement
of Operations
|
F5
|
|
|
Statement
of Cash Flows
|
F6
|
|
|
Statement
of Stockholders’ Equity
|
F7
|
|
|
Notes
to Financial Statements
|
F8-13
|
-F-2-
Financial
Statements
-F-3-
Adjuice,
Inc.
March
31, 2010
BALANCE
SHEET
Unaudited
|
|
March 31,
2010
|
December 31,
2009
|
||||||
|
ASSETS
|
||||||||
|
Current
assets :
|
||||||||
|
Cash
|
$ | - | $ | 43,959 | ||||
|
Accounts
receivable (less
allowance for doubtful accounts of $14,728 for both March
31,2010 and December 31, 2009)
|
80,692 | 57,113 | ||||||
|
Other
current assets
|
4,358 | 4,045 | ||||||
|
Total
current assets
|
$ | 85,050 | $ | 105,117 | ||||
|
Website,
net
|
1,633,400 | 1,735,487 | ||||||
|
Security
deposit
|
3,527 | - | ||||||
|
Total
assets:
|
$ | 1,721,977 | $ | 1,840,604 | ||||
|
LIABILITIES AND STOCKHOLDERS’
DEFICIT
|
||||||||
|
Current
liabilities:
|
||||||||
|
Accounts
payable
|
$ | 115,479 | $ | 50,733 | ||||
|
Other
current liabilities
|
45,317 | 12,627 | ||||||
|
Total
current liabilities
|
$ | 160,796 | $ | 63,360 | ||||
|
Long
term secured debt
|
$ | 2,277,804 | $ | 2,218,626 | ||||
|
Total
liabilities:
|
$ | 2,438,600 | $ | 2,281,986 | ||||
|
Stockholders’
deficit :
|
||||||||
|
Common
stock, $0.01 par value, 10,000,000 shares authorized and 9,900,000
outstanding, as of March 31, 2010 and December 31, 2009.
|
$ | 99,000 | $ | 99,000 | ||||
|
Accumulated
deficit
|
(815,623 | ) | (540,382 | ) | ||||
|
Total
stockholders' deficit
|
$ | (716,623 | ) | $ | (441,382 | ) | ||
|
Total
liabilities and stockholders' deficit
|
$ | 1,721,977 | $ | 1,840,604 | ||||
The
accompanying notes are an integral part of these financial statements.
-F-4-
Adjuice,
Inc.
STATEMENT
OF OPERATIONS
For
the three month period ended March 31, 2010
and
March 31, 2009
Unaudited
|
|
For the three
month period
ended
March 31, 2010
|
For the three
month period
ended
March 31, 2009
|
||||||
|
Revenues
|
$ | 362,839 | $ | - | ||||
|
Operating
expenses:
|
||||||||
|
Cost
of goods sold
|
311,560 | 44,578 | ||||||
|
Selling
general & administrative
|
61,470 | 2,600 | ||||||
|
Professional
fees
|
103,784 | 1,234 | ||||||
|
Amortization
|
102,088 | - | ||||||
|
Total
costs and operating expenses
|
$ | 578,902 | $ | 48,412 | ||||
|
Interest
expense
|
(59,178 | ) | - | |||||
|
Loss
from operations before income taxes
|
$ | (275,241 | ) | $ | (48,412 | ) | ||
|
Provision
for income tax
|
- | - | ||||||
|
Net
loss
|
$ | (275,241 | ) | $ | (48,412 | ) | ||
|
Basic and diluted net loss per
common share
|
$ | (0.028 | ) | $ | (242.06 | ) | ||
|
Weighted
average shares of capital outstanding – basic
|
$ | (0.028 | ) | $ | (242.06 | ) | ||
The
accompanying notes are an integral part of these financial statements.
-F-5-
Adjuice,
Inc.
STATEMENT
OF CASH FLOWS
For
the three month period ended March 31, 2010
and
March 31, 2009
Unaudited
|
For the three
month period
ended
March 31, 2010
|
For the three
month period
ended
March 31,
2009
|
|||||||
|
CASH FLOWS FROM OPERATING ACTIVITIES
:
|
||||||||
|
Net
loss
|
$ | (275,241 | ) | $ | (48,412 | ) | ||
|
Adjustments
to reconcile net (loss) to net cash provided by (used for)
operating activities :
|
||||||||
|
Amortization of
website costs
|
102,088 | - | ||||||
|
Imputed
interest on long-term debt
|
59,178 | |||||||
|
Changes
in components of working capital :
|
||||||||
|
Increase in
accounts receivable
|
(23,578 | ) | - | |||||
|
Increase
in other current assets
|
(3,840 | ) | - | |||||
|
Increase in
accounts payable
|
64,744 | 48,412 | ||||||
|
Increase in
other assets
|
32,690 | |||||||
|
Net
cash provided (used) by operating activities
|
$ | (43,959 | ) | $ | - | |||
|
NET
DECREASE
IN
CASHAND CASH
EQUIVALENTS
|
$ | (43,959 | ) | $ | - | |||
|
Cash
and cash equivalents, beginning of period
|
43,959 | - | ||||||
|
Cash
and cash equivalents, end of period
|
$ | - | $ | - | ||||
|
Interest
paid
|
$ | - | $ | - | ||||
|
Taxes
paid
|
$ | - | $ | - | ||||
The
accompanying notes are an integral part of these financial statements.
-F-6-
Adjuice,
Inc.
STATEMENTS
OF STOCKHOLDERS’ DEFICIT
For
the three month period ending March 31, 2010
and
the
twelve month period ended December 31, 2009
Unaudited
|
Common Stock
|
Preferred Stock
|
Additional
|
||||||||||||||||||||||||||
|
Shares
|
Par
Value
|
Shares
|
Par
Value
|
Paid in Capital
|
Accumulated
Deficit
|
Stockholders
Equity
|
||||||||||||||||||||||
|
Balance,
November 24, 2008 (inception)
|
- | - | - | - | - | - | - | |||||||||||||||||||||
|
Net
Loss
|
(329 | ) | (329 | ) | ||||||||||||||||||||||||
|
Balance,
December 31, 2008
|
- | - | - | - | - | (329 | ) | (329 | ) | |||||||||||||||||||
|
Shares
issued to professional for services valued at $0.01 per
share
|
6,150,000 | 61,500 | 61,500 | |||||||||||||||||||||||||
|
Common
stock sold
|
3,150,000 | 31,500 | 31,500 | |||||||||||||||||||||||||
|
Shares
issued in relationship to debt valued $0.01 per share
|
600,000 | 6,000 | 6,000 | |||||||||||||||||||||||||
|
Net
loss
|
(540,053 | ) | (540,053 | ) | ||||||||||||||||||||||||
|
Balance,
December 31, 2009
|
9,900,000 | $ | 99,000 | 0 | $ | - | $ | - | $ | (540,382 | ) | $ | (441,382 | ) | ||||||||||||||
|
Net
Loss
|
(275,241 | ) | $ | (275,241 | ) | |||||||||||||||||||||||
|
Balance,
March 31, 2010
|
9,900,000 | $ | 99,000 | 0 | $ | - | $ | - | $ | (815,623 | ) | $ | (716,623 | ) | ||||||||||||||
The
accompanying notes are an integral part of these financial statements.
-F-7-
ADJUICE,
INC.
NOTES
TO FINANCIAL STATEMENTS
(Unaudited)
|
1.
|
Description
of Business
|
Adjuice,
Inc. (“Adjuice or the “Company”) is a Delaware Corporation
organized November 24, 2008 and commenced operations at that time.
Adjuice, Inc. during the early part of 2009, launched its web site
Adjuice.com. The Adjuice network distributes leads to over 350 retail
clients along seven major verticals, all offering top payouts. Adjuice
owns and manages over 120 sites, all optimized for brand recognition and
conversion performance. Adjuice has a solid infrastructure for
selling its own products, and differs from the other networks out there
that broker deals between advertisers and publishers.
Adjuice
is positioned to innovate within the performance marketing and lead
generation industries while delivering quantifiable results to both our
upstream and downstream partners. Adjuice through its dba
LeadEmpire also provides pre-qualified leads to
businesses. Lead Empire creates lead generation programs tailored to meet
our customers specific requirements to fulfill their individual business
objectives.
●
The Company currently maintains its corporate office in Santa
Monica,
California.
|
|
2.
|
Summary
of Significant Accounting Policies
|
● Management
is responsible for the fair presentation of the Company’s financial
statements, prepared in accordance with U.S. generally accepted accounting
principles (GAAP).
|
|
|
Use
of Estimates
|
●
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates. Estimates are used in the determination of depreciation and
amortization, the valuation for non-cash issuances of common stock, and
the website, income taxes and contingencies, among
others.
|
||
|
Cash
and Cash Equivalents
|
●
The Company classifies as cash and cash equivalents amounts on deposit in
the banks and cash temporarily in various instruments with original
maturities of three months or less at the time of purchase. The Company’s
cash management system is integrated within two separate banking
institutions.
|
||
|
Fair
Value of Financial Instruments
|
●
Statement of financial accounting standard FASB Topic 820, Disclosures
about Fair Value of Financial Instruments, requires that the Company
disclose estimated fair values of financial instruments. The carrying
amounts reported in the statements of financial position for assets and
liabilities qualifying as financial instruments are a reasonable estimate
of fair value except
for the long-term borrowings which is net of a $722,196 debt discount as
of March
31, 2010.
|
-F-8-
|
Website
and Amortization
|
●
The Company accounts for web site costs in accordance with FASB Topic 350
“Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use and FASB Topic 350 “Accounting for Web Site Development
Costs”. As a result, costs associated with the web site
application and infrastructure development stage are
capitalized. Amortization of costs commenced once the web site
was ready for its intended use.
|
||
|
●
Financial reporting provisions for amortization are generally based on the
following annual rates and estimated useful
lives:
|
|
Type of Asset
|
Rates
|
Years
|
||||||
|
Website
Development Costs
|
20 | % |
5
years
|
|||||
|
Income
Taxes
|
●
The Company has not generated any taxable income, and, therefore, no
provision for income taxes has been provided.
●
Deferred income taxes are reported for timing differences between items of
income or expense reported in the financial statements and those reported
for income tax purposes in accordance with FASB Topic 740, "Accounting for
Income Taxes", which requires the use of the asset/liability method of
accounting for income taxes. Deferred income taxes and tax benefits are
recognized for the future tax consequences attributable to differences
between the financial statement carrying amounts of existing assets and
liabilities and their respective tax bases, and for tax loss and credit
carry-forwards. Deferred tax assets and liabilities are measured using
enacted tax rates expected to apply to taxable income in the years in
which those temporary differences are expected to be recovered or settled.
The Company provides for deferred taxes for the estimated future tax
effects attributable to temporary differences and carry-forwards when
realization is more likely than not.
●
A valuation allowance has been recorded to fully offset the deferred tax
asset as the Company has no assurances that the assets will be utilized at
this point in time.
●
The Company’s effective tax rate differs from the statutory rates
associated with taxing jurisdictions because of permanent and temporary
timing differences as well as a valuation allowance.
|
||
|
Revenue
Recognition
|
The
Company generates its revenue from generating customer acquisition leads
and selling those introductions to retail clients to present to their
selected customers. Adjuice targets from its data base selected customers
that fit the model in which their clients believe are the ideal
customer. Adjuice owns and manages over 120 sites, all
optimized for brand recognition and conversion performance.
●
All sources of revenue will be recorded pursuant to FASB Topic 605 Revenue
Recognition, when persuasive evidence of arrangement exists, delivery of
services has occurred, the fee is fixed or determinable and collectability
is reasonably assured.
|
||
|
Stock
Based Compensation
|
●
The Company accounts for stock based compensation in accordance with FASB
Topic 718, “Share Based Payment”.
|
||
|
Concentration
of Credit Risk
|
●
Financial instruments that potentially subject the Company to
concentrations of credit risk consist principally of cash deposits at
financial institutions. At various times during the year, the
Company may exceed the federally insured limits. To mitigate
this risk, the Company places its cash deposits only with high credit
quality institutions. Management believes the risk of loss is
minimal. At March 31, 2010 the Company did not have any
uninsured cash deposits.
|
-F-9-
|
Impairment
of Long-lived Assets
|
●
The Company accounts for long-lived assets in accordance with the
provisions of FASB Topic 360, Accounting for the Impairment of Long-Lived
Assets. This statement requires that long-lived assets and certain
identifiable intangibles be reviewed for impairment whenever events or
changes in circumstances indicate that the carrying amount of an asset may
not be recoverable. Recoverability of assets to be held and used is
measured by a comparison of the carrying amount of an asset to future net
cash flows expected to be generated by the asset. If such assets are
considered to be impaired, the impairment to be recognized is measured by
the amount by which the carrying amount of the assets exceeds the fair
value of the assets. Assets to be disposed of are reported at the lower of
the carrying amount or fair value less costs to sell. Fair values are
determined based on quoted market value, discounted cash flows or internal
and external appraisals, as applicable. During 2010, the Company did not
recognize an impairment charge.
|
||
|
Recent
Accounting Pronouncements
|
●
The Company's management has reviewed all of the FASB's Accounting
Standard Updates through August 25, 2010 and has concluded that none will
have a material impact on the Company's financial statements.
Management
does not believe that any other recently issued but not yet effective
accounting pronouncements, if adopted, would have an effect on the
accompanying consolidated financial statements.
|
||
|
3.
|
Going
Concern
|
●
The Company's financial statements are prepared using generally accepted
accounting principles, which contemplate the realization of assets and
liquidation of liabilities in the normal course of
business. The Company has an accumulated deficit $815,623 and
is dependent on raising capital to fund future operations.
●
Management is taking steps to raise additional funds to address its
operating and financial cash requirements to continue operations in the
next twelve months. Management has devoted a significant amount of time in
the raising of capital from additional debt and equity financing. However,
the Company’s ability to continue as a going concern is dependent upon
raising additional funds through debt and equity financing and generating
revenue. There are no assurances the Company will receive the necessary
funding or generate revenue necessary to fund
operations.
|
|
|
4.
|
Website
|
●
Website at March 31, 2010 and 2009 consisted of the
following:
|
|
2010
|
2009
|
|||||||
|
Web
site and software
|
$ | 2,041,750 | - | |||||
|
Less:
accumulated amortization
|
(408,350 | ) | - | |||||
| $ | 1,633,400 | - | ||||||
|
●
The Company acquired the website from the note holders. The Company valued
the website at the discounted value of the note upon issuance. See
footnote 7. Long Term Debt.
Amortization expense totaled $102,088 for the three month period ended
March 31, 2010.
●
The value of the website was evaluated for impairment as of March 31, 2010
using the future discounted cash-flow method. No impairment was considered
necessary as of March 31,
2010.
|
-F-10-
|
5.
|
Other
Assets
|
●
Other current assets consist of the following at March 31, 2010 and 2009
respectively.
|
|
2010
|
2009
|
|||||||
|
Credit
card reserve
|
$ | 3,259 | $ | - | ||||
|
Prepaid
server license
|
1,099 | - | ||||||
|
TOTAL
|
$ | 4,358 | $ | - | ||||
|
6.
|
Other
Current Liabilities
|
●
Other current liabilities consist of the following at March 31, 2010 and
2009 respectively.
|
|
2010
|
2009
|
|||||||
|
Accrued
contractor payments
|
$ | 4,758 | - | |||||
|
Accrued
Payroll
|
40,559 | - | ||||||
|
TOTAL
|
$ | 45,317 | - | |||||
|
7.
|
Long
term debt
|
●
On April 6, 2009 the Company enter into an agreement to assume two notes
of $1,500, 000 each from Venture Lending & Leasing IV Inc. and Venture
Lending & Leasing V Inc. for a total of $3,000,000 of indebtedness. .
Also included in the consideration was 600,000 shares of Adjuice’ s common
shares as further inducement to enter into this transaction, the value of
these shares went into the debt discount recorded. The consideration
received by the Company was the lead generation website and related
software technologies that is the operating platform for Adjuice, Inc.
This note does not bear any interest.
●
Since this is a performance based, non-interest bearing note, the Company
has utilized imputed interest on the note at rate of 8% per annum
discounting over the estimated life of the note which the Company has
estimated at a five year
period.
|
|
2010
|
2009
|
|||||||
|
Long
term secured debt
|
$ | 3,000,000 | - | |||||
|
Less:
note discount.
|
(722,196 | ) | - | |||||
|
TOTAL
|
$ | 2,277,804 | - | |||||
|
Amortization
of the note discount was $59,178 for the three month period ended March
31, 2010.
●
The note is secured by the above related website assets and is payable
beginning forty-five (45) days after the one year anniversary of the note.
The note is payable based on 5% of the monthly gross profit forty-five
days after the end of the month. This percentage of gross profit is
reduced to 3.5% after the payment of $500,000 and reduced further to 2.5%
upon the aggregate payment of $1,000,000 from the gross profit
formula.
|
|||
|
8.
|
Capital
Stock Activity
|
●
On November 24, 2008 The Company was incorporated in the State of Delaware
under the name Snap Customers, Inc. The Board authorized 200 shares of
stock with no par value. On March 17th
of 2009 the Board changed the name of the Corporation to Adjuice,
Inc.
●
On February 29, 2009 the Snap Customers, Inc. Board Authorized and through
subsequent shareholder approval increase the amount of authorized stock to
10,000,000 shares of stock at a par value of
$0.01.
|
-F-11-
|
●
During the month of December the Company issued 6,150,000 shares of common
stock to Sunlight Ventures LLC for professional fees rendered during the
year. Also during December the Company issued 600,000 shares to two
entities Venture Lending & Leasing IV & V, Inc. as part of the
loan assumption agreement.
●
On December 25th
2009 the Company sold 3,150,000 shares of its common stock to three
different entities.
Dividends
●
The Company has never issued dividends.
Warrants
●
The Company did not issue any warrants during the quarter.
Options
●
The Company has never issued options.
|
|||
|
9.
|
Advances
by Affiliates
|
●
During the three months ended March 31, 2010 the Company accrued a
management fee of $9,000 a month or $27,000 to Sunlight Ventures a
Corporation controlled by Matt Hill. Also during the quarter the Company
paid Matt Hill and Sunlight Venture $17,000. In addition Matt Hill
provided advances to the Company of $29,600 via a promissory
note.
|
|
|
10.
|
Commitments
and Contingencies
|
●
The Company leases 2,367 square feet of office space from the City of
Santa Monica on a month to month basis. During the three month period
ended March 31, 2010 it incurred $2,355 in rent
expense.
|
|
|
11.
|
Significant
Customers and Suppliers
|
●
The Company derives a significant portion of its revenue from lead
generation in the advertising space. This is a very competitive market
with many providers for the services the Company offers. The Company
believes that it can replace any one product line with another supplier
without any disruptions in activity.
|
|
|
12.
|
Segment
Reporting
|
● The Company considers itself to be
operating in one business segment, the internet sales lead generation
business. This activity will represent essentially all of the significant
revenue generated by the
Company.
|
|
|
14.
|
Related
Parties
|
● Mr. Mathew Hill is the President of
Sunlight Ventures LLC the owner of 62% of the stock of Adjuice. Two other
entities Echo Capital and Harvard Developments which own 31% collectively
of Adjuice are controlled by family members of Mr.
Hill.
|
|
|
13.
|
Subsequent
Events
|
●
On May 19, 2010, the Company entered into s stock exchange agreement with
Beyond Commerce, Inc. whereas all the shares owned by adjuice shareholders
were exchanged for 5,100,000 shares of Beyond Commerce, Inc. common stock.
Also during this transaction the two lenders Venture Lending & Leasing
IV & V, Inc. converted their note into 900,000 shares of Beyond
Commerce stock.
|
-F-12-
|
14.
|
Net
Loss per Share of Common Stock
|
●
The Company has adopted FASB Topic 260, "Earnings per Share," which
requires presentation of basic and diluted EPS on the face of the income
statement for all entities with complex capital structures and requires a
reconciliation of the numerator and denominator of the basic EPS
computation to the numerator and denominator of the diluted EPS
computation. In the accompanying financial statements, basic loss per
share of common stock is computed by dividing net loss by the weighted
average number of shares of common stock outstanding during the
year. Basic net loss per common share is based upon the
weighted average number of common shares outstanding during the period.
Dilution is computed by applying the treasury stock method. Under this
method, options and warrants are assumed to be exercised at the beginning
of the period (or at the time of issuance, if later), and as if funds
obtained thereby were used to purchase common stock at the average market
price during the period. However, shares associated with convertible debt,
stock options and stock warrants are not included because the
inclusion would be anti-dilutive (i.e. reduce the net loss per common
share). There were no anti-dilutive
instruments.
|
|
Three
month period ending March 31,
|
2010
|
2009
|
||||||
|
Numerator
- basic and diluted loss per share net loss
|
$ | (275,241 | ) | $ | (48,412 | ) | ||
| — | — | |||||||
|
Net
loss available to common stockholders
|
$ | (275,241 | ) | $ | (48,412 | ) | ||
|
Denominator
– basic and diluted loss per share – weighted average common shares
outstanding
|
9,900,000 | 200 | ||||||
|
Basic
and diluted earnings per share
|
$ | (0.028 | ) | $ | (242.06 | ) | ||
-F-13-