Attached files
| file | filename |
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| 8-K - CURRENT REPORT - Santaro Interactive Entertainment Co | santaro-8k_1012.htm |
| EX-99.1 - AUDITED FINANCIAL STATEMENTS - Santaro Interactive Entertainment Co | ex-99_1.htm |
Exhibit 99.2
Pro Forma Combined Financial Statements
The following pro forma balance sheet has been derived from the balance sheet of Santaro Interactive Entertainment Company at June 30, 2010, and adjusts such information to give the effect of the acquisition of Santaro holdings Ltd, a British Virgin Island corporation, as if it would have existed on June 30, 2010. The following pro forma earnings per share (EPS) statement has been derived from the income statement of Santaro holdings Ltd and adjusts such information to give the effect that the acquisition by Santaro Interactive Entertainment Company occurred on January 1, 2009. The pro forma balance sheet and EPS statement is presented for informational purposes only and does not purport to be indicative of the financial condition that would have resulted if the acquisition would have existed on June 30, 2010 or December 31, 2009.
Sntaro Interactive Entertainment Company
PRO FORMA BALANCE SHEET
June 30, 2010
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Beijing Sntaro Technology Co., Ltd
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Ningbo Sntaro Network Technology Co., Ltd
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Santaro
Investments,
Ltd
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Santaro Holdings, Ltd.
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Santaro Interactive Entertainment Company
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Pro forma
Adjustments
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Pro Forma
Combined
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ASSETS
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Current assets
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Cash and cash equivalents
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$ | 46,508 | $ | - | $ | - | $ | - | $ | 4,089 | $ | $ | 50,597 | |||||||||||||||||
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Prepaid expense
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36,563 | - | - | - | 1,264 | 37,827 | ||||||||||||||||||||||||
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Other receivables
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39,412 | - | - | - |
-
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39,412 | ||||||||||||||||||||||||
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Total current assets
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122,483 | - | - | - | 5,353 | 127,836 | ||||||||||||||||||||||||
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Property and equipment, net
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208,279 | - | - | - | 208,279 | |||||||||||||||||||||||||
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Intangibles
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- | - | - | - | 6,199 | 6,199 | ||||||||||||||||||||||||
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Deferred tax asset
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866,955 | - | - | - | - | 866,955 | ||||||||||||||||||||||||
| $ | 1,197,717 | $ | - | $ | - | $ | - | $ | 11,552 | $ | $ | 1,209,269 | ||||||||||||||||||
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LIABILITIES AND STOCKHOLDERS’ EQUITY
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Current liabilities
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Other payables and accrued expenses
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$ | 48,799 | $ | - | $ | 3,388 | $ | 1,450 | $ | 8,624 | $ | 62,261 | ||||||||||||||||||
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Due to a related party
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3,670,652 | - | - | - | - | 3,670,652 | ||||||||||||||||||||||||
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Total current liabilities
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3,719,451 | - | 3,388 | 1,450 | 8,624 | 3,732,913 | ||||||||||||||||||||||||
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Stockholders’ equity
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Common stock ($0.001 par value; authorized - 75,000,000 shares; issued and outstanding – 67,500,000 shares)
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- | - | - | - | 11,830 | 55,670 | A | 67,500 | ||||||||||||||||||||||
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Capital contribution
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1,371,496 | - | - | - | - | (1,371,496 | ) | B | - | |||||||||||||||||||||
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Additional Paid-In Capital
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- | - | - | - | 10,085 | (55,670 | ) | A | 1,325,911 | |||||||||||||||||||||
| 1,371,496 | B | |||||||||||||||||||||||||||||
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Deficit accumulated during the development stage
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(3,871,407 | ) | - | (3,388 | ) | (1,450 | ) | (18,987 | ) | (29,299 | ) | C | (3,924,531 | ) | ||||||||||||||||
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Accumulated other comprehensive income
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8,197 | - | - | - | - | (721 | ) | C | 7,476 | |||||||||||||||||||||
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Noncontrolling interest
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(30,020 | ) | 30,020 | C | - | |||||||||||||||||||||||||
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Total stockholders’ equity
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(2,521,734 | ) | - | (3,388 | ) | (1,450 | ) | 2,928 | (2,523,644 | ) | ||||||||||||||||||||
| $ | 1,197,717 | $ | - | $ | - | $ | - | $ | 11,552 | $ | 1,209,269 | |||||||||||||||||||
PRO FORMA EARNINGS PER SHARE
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Year Ended
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Six months Ended
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December 31, 2009
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June 30, 2010
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Net loss attributable to holders of common shares
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$ | (2,270,618 | ) | $ | (623,266 | ) | |||
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Net loss Per Share
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Basic and diluted
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$ | (0.03 | ) | $ | (0.01 | ) | |||
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Weighted average number of common shares outstanding
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Basic and diluted
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67,500,000 | 67,500,000 | |||||||
Notes to Pro Forma Financial Statements
On October 12, 2010, Santaro Interactive Entertainment Company entered into a Share Exchange Agreement (the“Exchange Agreement”), with Santaro Holdings, Ltd., a limited liability company organized under the laws of British Virgin Islands, (“SHL”), and the shareholders of SHL (collectively the “SHL Shareholders”). Pursuant to the terms of the Exchange Agreement, the SHL Shareholders transferred to Santaro Interactive Entertainment Company 100% of the outstanding shares of SHL in exchange for the issuance of 55,670,000 restricted shares of the common stock of Santaro Interactive Entertainment Company. SHL is a holding company which has a 100% ownership interest in Santaro Investments, Ltd., a Hong Kong company which in turn has a 100% ownership interest in Ningbo Sntaro Network Technology Co., Ltd, a Wholly Foreign Owned Enterprise (“WFOE”) established in the People’s Republic of China. Through control of the WFOE, Santaro Interactive Entertainment Company controls Beijing Sntaro Technology Co., Ltd, a company organized under the laws of the People’s Republic of China and engaged in the development and operation of online games.
As a result of the transactions described above, Santaro Interactive Entertainment Company became the record and beneficial owner of 100% of the share capital of SHL and therefore owns 100% of the share capital of its subsidiaries and Variable Interest Entities indirectly.
As a result of the Exchange Agreement, Santaro Interactive Entertainment Company will have 67,500,000 shares of common stock issued and outstanding. Pursuant to the terms of the Exchange Agreement, SHL’s officers and directors were appointed as Santaro Interactive Entertainment Company’s officers and directors, and Mr. James Edsall resigned from each officer position held. The transaction was regarded as a reverse merger whereby SHL was considered to be the accounting acquirer.
The preceding pro forma balance sheet represents the combined financial position of SHL and Santaro Interactive Entertainment Company as of June 30, 2010, as if the closing of the Exchange Agreement occurred on June 30, 2010.
The pro forma combined financial information is presented for illustrative purposes only and is not necessarily indicative of the operating results that would have been achieved if the acquisition of SHL had been consummated as of the beginning of the period indicated, nor is necessarily indicative of the results of future operations.
Assumptions and Adjustments:
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A)
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At closing and pursuant to the Exchange Agreement, Santaro Interactive Entertainment Company acquired all of the issued and outstanding capital stock of SHL in exchange for the issuance of 55,670,000 common shares of Santaro Interactive Entertainment Company;
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B)
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At closing, common stock of Santaro Interactive Entertainment Company will be reclassified to additional paid-in-capital to reflect the additional shares of common stock issued as part of the Exchange Agreement.
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C)
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At closing, FL Network’s noncontrolling owners, including FL Media and Mrs. Yu Bai, transferred their FL Network ownership to Sntaro Beijing for no cash consideration, and Sntaro Beijing thereby gained a 100% ownership interest in FL Network.
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