Attached files
Exhibit 99.2
LINKWELL CORPORATION AND SUBSIDIARIES
PRO FORMA FINANCIAL INFORMATION
The following unaudited pro forma financial statements of Linkwell Corporation (“LWLL”) are based on, and should be read in conjunction with:
1.
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LWLL’s audited financial statements for the fiscal year ended December 31, 2011.
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2.
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Metamining Nevada, Inc.’s audited financial statements for the fiscal year ended December 31, 2011.
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On March 30, 2012, LWLL issued 9,581,973 shares of its Series C convertible preferred stock and 3,000,000 Series C common stock purchase warrants in conjunction with the acquisition of Metamining Nevada. LWLL is the legal acquirer in the transaction. As a result of the acquisition, under reverse acquisition accounting rules per ASC 805-40, LWLL becomes the accounting acquiree owning 8.9%, and Metamining Nevada is the accounting acquirer owning 91.1% of the total outstanding shares of common stock on an as converted basis after giving effect to the transaction.
The pro forma financial statements give effect to the acquisition as if it had taken place on the date or at the beginning of the period presented.
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LINKWELL CORPORATION AND SUBSIDIARIES
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PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME
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FOR THE YEAR ENDED DECEMBER 31, 2011
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Linkwell Corporation
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Metamining Nevada, Inc.
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Pro Forma
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Pro Forma
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Adjustments
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Consolidated
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(Audited)
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(Audited)
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(Unaudited)
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(Unaudited)
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NET SALES
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Non-related companies
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$ | 7,685,380 | $ | 7,685,380 | ||||||||||||||
Related companies
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9,272,860 | 9,272,860 | ||||||||||||||||
Total Net Sales
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16,958,240 | 16,958,240 | ||||||||||||||||
Cost of Sales
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9,529,720 | 9,529,720 | ||||||||||||||||
Gross Profit
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7,428,520 | - | 7,428,520 | |||||||||||||||
Operating (expenses) income:
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Selling expenses
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1,439,412 | 1,439,412 | ||||||||||||||||
General and administrative
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3,194,631 | 117,945 | 3,312,576 | |||||||||||||||
Total operating expenses
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4,634,043 | 117,945 | 4,751,988 | |||||||||||||||
Operating income (loss)
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2,794,477 | (117,945 | ) | 2,676,532 | ||||||||||||||
Other (expenses) income:
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Other expense
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(45,877 | ) | (45,877 | ) | ||||||||||||||
Interest income
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1,055 | 1,055 | ||||||||||||||||
Interest expense
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(89,036 | ) | (89,036 | ) | ||||||||||||||
Total other expense
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(133,858 | ) | - | - | (133,858 | ) | ||||||||||||
Income (loss) before income taxes
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2,660,619 | (117,945 | ) | 2,542,674 | ||||||||||||||
Income tax expense
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(492,630 | ) | (492,630 | ) | ||||||||||||||
Net income (loss)
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2,167,989 | (117,945 | ) | 2,050,044 | ||||||||||||||
Net income attributable to noncontrolling interests-continuing operations
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(279,703 | ) | - | (279,703 | ) | |||||||||||||
Net income (loss) attributable to Linkwell Corp
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1,888,286 | (117,945 | ) | - | 1,770,341 | |||||||||||||
Other comprehensive income:
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Foreign currency translation
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785,599 | - | 785,599 | |||||||||||||||
Comprehensive income
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$ | 2,673,885 | $ | (117,945 | ) | - | $ | 2,555,940 | ||||||||||
Basic and diluted income (loss) per common share
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Basic
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$ | 0.62 | 3.87 | |||||||||||||||
Diluted (2)
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$ | 0.62 | 0.14 | |||||||||||||||
Basic weighted average common shares outstanding
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3,048,310 |
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(2,591,065 | ) | (3) | 457,245 | ||||||||||||
Diluted weighted average common shares outstanding
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3,048,310 |
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12,581,973 |
(1)
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13,039,218 | |||||||||||||
(2,591,065 | ) | (3) |
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Note (1): Represents the dilutive effect of 9,581,973 shares of Series C convertible preferred stock and 3,000,000 Series C warrants issued by Linkwell Corporation in conjunction with the acquisition of Metamining Nevada, which is treated as reverse acquisition.
Note (2): The dilutive effect impacts only the dilutive EPS in the pro forma calculation.
Note (3): Represents adjustment for Linkwell common shares to reflect the proposed 1:200 reverse stock split in the acquisition.
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LINKWELL CORPORATION AND SUBSIDIARIES
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PRO FORMA CONSOLIDATED BALANCE SHEETS
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As of December 31, 2011
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Linkwell Corporation
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Metamining Nevada, Inc.
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Pro Forma Adjustments
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(A)
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Pro Forma
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(Unaudited)
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(Unaudited)
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(Unaudited)
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(Unaudited)
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ASSETS
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CURRENT ASSETS
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Cash and cash equivalents
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$ | 2,919,670 | $ | 2,919,670 | |||||||||||||||
Accounts receivable, net
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2,707,574 | 2,707,574 | |||||||||||||||||
Accounts receivable - related parties, net
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9,943,773 | 9,943,773 | |||||||||||||||||
Due from related party
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691,156 | 691,156 | |||||||||||||||||
Other receivables
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3,926,230 | 3,926,230 | |||||||||||||||||
Prepaid expenses and other current assets
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671,340 | 671,340 | |||||||||||||||||
Inventories, net
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1,964,313 | 1,964,313 | |||||||||||||||||
Total current assets
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22,824,056 | 22,824,056 | |||||||||||||||||
NON-CURRENT ASSETS
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Investment
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1,282,467 | 1,282,467 | |||||||||||||||||
Property, plant and equipment, net
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2,185,116 | 2,185,116 | |||||||||||||||||
Construction in progress
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240,497 | 240,497 | |||||||||||||||||
Prepaid for land use right
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606,263 | 606,263 | |||||||||||||||||
Intangible assets
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308,188 | 308,188 | |||||||||||||||||
Property and mineral rights
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$ | 14,250,000 | 14,250,000 | ||||||||||||||||
Total non-current assets
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4,622,532 | 14,250,000 | 18,872,532 | ||||||||||||||||
TOTAL ASSETS
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$ | 27,446,588 | $ | 14,250,000 | $ | 41,696,588 | |||||||||||||
CURRENT LIABILITIES
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Loans payable
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$ | 1,587,075 | $ | 1,587,075 | |||||||||||||||
Accounts payable and accrued expenses
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3,112,699 | $ | 5,000 | 3,117,699 | |||||||||||||||
Advances from customers
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365,993 | 365,993 | |||||||||||||||||
Taxes payable
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456,169 | 456,169 | |||||||||||||||||
Other payables
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255,569 | 255,569 | |||||||||||||||||
Due to related parties
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1,834,582 | 1,834,582 | |||||||||||||||||
Notes payable
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5,625,000 | 5,625,000 | |||||||||||||||||
Total current liabilities
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7,612,087 | 5,630,000 | 13,242,087 | ||||||||||||||||
Notes payable
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5,625,000 | 5,625,000 | |||||||||||||||||
Put option liability
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2,400,000 | (2,400,000 | ) | (1 | )(5) | 0 | |||||||||||||
Total liabilities
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10,012,087 | 11,255,000 | (2,400,000 | ) | 18,867,087 | ||||||||||||||
STOCKHOLDERS' EQUITY
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Common Stock
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47,303 | 47,303 | |||||||||||||||||
Additional paid-in capital
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7,870,021 | 3,112,945 | 11,131,775 | (1 | )(5) | 22,114,741 | |||||||||||||
Statutory surplus reserve
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802,749 | (802,749 | ) | (3 | ) | 0 | |||||||||||||
Retained earnings (Accumulated deficit)
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6,076,805 | (117,945 | ) | (6,076,805 | ) | (2 | ) | (117,945 | ) | ||||||||||
Accumulated other comprehensive income
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1,852,221 | (1,852,221 | ) | (4 | ) | 0 | |||||||||||||
Total equity
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16,649,099 | 2,995,000 | 2,400,000 | 22,044,099 | |||||||||||||||
NONCONTROLLING INTEREST
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785,402 | 785,402 | |||||||||||||||||
TOTAL STOCKHOLDERS' EQUITY
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17,434,501 | 2,400,000 | 19,834,501 | ||||||||||||||||
TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY
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$ | 27,446,588 | $ | 14,250,000 | 0 | $ | 41,696,588 |
Note (A): See related notes for explanations for pro forma adjustments.
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Note (1): On March 30, 2012, Linkwell Corporation issued 9,581,973 shares of its Series C convertible preferred stock and 3,000,000 Series C common stock purchase warrants in conjunction with the acquisition of Metamining Nevada, which have been accounted for as additional paid in capital and also been charged to additional paid in capital to reflect merger under reverse acquisition accounting rules (ASC 805-40). As a result of the acquisition, the legal acquirer ("LWLL") becomes the accounting acquiree owning 8.9%, and the legal acquiree, ("Metamining Nevada") is the accounting acquirer owning 91.1% of the total outstanding shares after giving effect to the transaction.
Aggregate effect of the transactions:
A. To eliminate Linkwell retained earnings
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$6,076,805
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See Note (2)
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B. To eliminate Linkwell statutory surplus reserve
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802,749
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See Note (3)
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C. To eliminate Linkwell accumulated other comprehensive income (AOCI)
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1,852,221
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See Note (4)
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D. To eliminate Linkwell put option liability
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2,400,000
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See Note (5)
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Total APIC adjustments
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$11,131,775
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Note (2): Represents the elimination of Linkwell retained earnings.
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$6,076,805
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See Note (1)
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Note (3): Represents the elimination of Linkwell statutory surplus reserve.
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$802,749
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See Note (1)
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Note (4): Represents the elimination of Linkwell AOCI.
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$1,852,221
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See Note (1)
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Note (5): Represents the elimination of Linkwell put option liability, which was cancelled by the option holders in March 2012.
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$2,400,000
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See Note (1)
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