NOTES TO PROFORMA CONDENSED COMBINED FINANCIAL STATEMENTS

[Unaudited]

NOTE 1 –SIGMA LABS, INC.

Sigma Labs was originally organized in December, 1985, but has gone through some reorganizations and name changes. Sigma owns and is currently carrying on its operations through its wholly-owned subsidiary, B6 Sigma, Inc. B6 Sigma, Inc. (“B6”) was organized under the laws of the State of Delaware on February 5, 2010. B6 was founded by a group of scientists, engineers and businessmen to develop and commercialize novel and unique manufacturing and materials technologies. The Company's focus is on various devices which are referred to as the "In Process Quality Assurance" (IPQA) systems. It is the belief of management that this technology will fundamentally redefine conventional manufacturing practices. In addition the Company has developed other products, technologies and services, to be offered to manufacturers, governmental agencies and other scientific and commercial enterprises.

NOTE 2 –LA MANCHA COMPANY

La Mancha Company (“LM”) is a small business with a broad spectrum of scientific disciplines that provides consulting services to the private sector, especially with regard to emerging technologies, alternative applications of established technologies, and assessment of development and maintenance programs for strategic technologies. The company’s principal product is scientific and technological knowledge, gained through academic discipline, research activities and application experience. La Mancha, formed in 1982, expanded in 1993 with the addition of retired scientists and technical managers from the Los Alamos National Laboratory. The company offers consulting services that are based on sound science, an unprejudiced perspective, multi-disciplined capabilities at reasonable rates. La Mancha Company’s primary work is to provide risk assessment as well as technical and management, often in the international environment. The firm maintains extensive contacts, both public and private, in Latin America, Europe, Asia and the Middle East, as well as with top levels of the U.S. Government.

NOTE 3 – SUMNER & LAWRENCE LIMITED

Sumner & Lawrence Limited (“Sumner”) is a small business with a broad spectrum of scientific disciplines that provides consulting services to the public sector, especially with regard to emerging technologies, alternative applications of established technologies, and assessment of development and maintenance programs for strategic technologies. The company’s principal product is scientific and technological knowledge, gained through academic discipline, research activities and application experience. Sumner, formed in 1985, expanded in 1993 with the addition of retired senior scientists and technical managers from the Los Alamos National Laboratory. The company offers consulting services that are based on sound science, an unprejudiced perspective, multi-disciplined capabilities at reasonable rates. Sumner holds ongoing contracts with government agencies that provide a framework of audited fees and burden, as well as appropriate levels of security clearance. Major clients include the State Department, the Department of Defense, the Department of Energy, various military services and affiliated agencies, the National Laboratories, and contractors to these organizations.

NOTE 4 - PROFORMA ADJUSTMENTS

On December 31, 2011, LM and Sumner were acquired by Sigma pursuant to an Exchange Agreement and Plan of Reorganization. The agreement called for Sigma to issue 35,000,000 shares of common stock to the shareholders of LM and Sumner for 100% of the outstanding shares of LM and Sumner common stock in a transaction wherein LM and Sumner would became wholly-owned subsidiaries of Sigma.

Proforma adjustments on the attached financial statements include the following:

NOTE 5 - PROFORMA (LOSS) PER SHARE

The proforma (loss) per share is computed based on the number of shares outstanding, after adjustment for shares issued in the acquisition, as though all shares issued in the acquisition had been outstanding from the beginning of the periods presented.