Attached files
| file | filename |
|---|---|
| 8-K - CURRENT REPORT - Excel Corp | f8k011413_excelcorp.htm |
| EX-2.1 - AGREEMENT AND PLAN OF MERGER, DATED AS OF JANUARY 14, 2013, BY AND AMONG EXCEL CORPORATION, ECB ACQUISITION CORP. AND EXCEL BUSINESS SOLUTIONS, INC. - Excel Corp | f8k011513ex2i_excelcorp.htm |
| EX-2.2 - CERTIFICATE OF MERGER, DATED JANUARY 14, 2013 MERGING ECB ACQUISITION CORP. WITH AND INTO EXCEL BUSINESS SOLUTIONS, INC. - Excel Corp | f8k011513ex2ii_excelcorp.htm |
| EX-10.1 - DAVID POPKIN?S EMPLOYMENT AGREEMENT - Excel Corp | f8k011513ex10i_excelcorp.htm |
| EX-10.2 - SHAWN ALCOBA?S EMPLOYMENT AGREEMENT - Excel Corp | f8k011513ex10ii_excelcorp.htm |
| EX-99.2 - PRESS RELEASE DATED JANUARY 16, 2013 - Excel Corp | f8k011513ex99ii_excelcorp.htm |
| EX-10.3 - FORM OF LOCKUP AGREEMENT - Excel Corp | f8k011513ex10iii_excelcorp.htm |
Exhibit 99.1
Excel Business Solutions, Inc.
A Development Stage Company
December 31, 2012
Contents
| Page | |
| Report of Independent Registered Public Accounting Firm | 1 |
| Financial Statements | |
| Balance Sheet, December 31, 2012 | 2 |
|
Statement of Operations
From Inception, November 8, 2012 through December 31, 2012
|
3 |
|
Statement of Stockholders' Equity
From Inception, November 8, 2012 through December 31, 2012
|
4 |
|
Statement of Cash Flows
From Inception, November 8, 2012 through December 31, 2012
|
5 |
| Notes to Financial Statements | 6 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Stockholders
Excel Business Solutions, Inc.
4010 Dupont Circle
Suite 482
Louisville, Kentucky 40207
We have audited the accompanying balance sheets of Excel Business Solutions, Inc. (a Delaware corporation) (A Development Stage Company) as of December 31, 2012, and the related statements of operations, stockholders’ equity and cash flows for the period November 8, 2012 (date of inception) to December 31, 2012. Excel Business Solution, Inc.’s management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Excel Business Solutions, Inc. as of December 31, 2012, and the results of its operations and its cash flows for the period from November 8, 2012 (date of inception) to December 31, 2012 in conformity with accounting principles generally accepted in the United States of America.
Certified Public Accountants
Philadelphia, Pennsylvania
January 7, 2013
1.
Excel Business Solutions, Inc.
(A Development Stage Company)
Balance Sheet
December 31, 2012
ASSETS
|
CURRENT ASSETS
|
||||
|
Cash
|
$ | 100 | ||
|
Total assets
|
100 | |||
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||
|
CURRENT LIABILITIES
|
||||
|
Accounts payable
|
368 | |||
|
Accrued expenses
|
3,000 | |||
|
Advance due to shareholders
|
17,500 | |||
|
Total current liabilities
|
20,868 | |||
|
STOCKHOLDERS’ EQUITY
|
||||
|
Common stock, no par value, 1,000 shares
|
||||
|
authorized, 1,000 issued and outstanding
|
100 | |||
|
Deficit accumulated during the development stage
|
(20,868 | ) | ||
|
Total stockholders’ equity
|
(20,768 | ) | ||
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$ | 100 | ||
See accompanying notes and accountant’s report.
2.
Excel Business Solutions, Inc.
(A Development Stage Company)
Statement of Operations
From November 8, 2012 (Date of Inception) to December 31, 2012
|
Revenue – net
|
$ | |||
|
Cost of sales
|
||||
|
Gross profit
|
||||
|
Expenses
|
||||
|
Legal fees
|
17,500 | |||
|
Accounting fees
|
3,000 | |||
|
Miscellaneous fees
|
368 | |||
|
Total expenses
|
20,868 | |||
|
Net loss before income taxes
|
(20,868 | ) | ||
|
Income Taxes
|
||||
|
Current
|
||||
|
Deferred
|
||||
|
Total income taxes
|
||||
|
Net (Loss)
|
$ | (20,868 | ) | |
|
(Loss) per basic share
|
$ | (20.87 | ) | |
|
Weighted average shares
|
||||
| Outstanding | ||||
| Basic | 1,000 |
See accompanying notes and accountant’s report.
3.
Excel Business Solutions, Inc.
(A Development Stage Company)
Statement of Stockholders’ Equity
From November 8, 2012 (Date of Inception) to December 31, 2012
| Preferred Stock | Common Stock | Deficit Accumulated During the Development | ||||||||||||||||||
| Shares | Amount | Shares | Amount | Stage | ||||||||||||||||
|
Balance, November 13, 2010
|
$ | $ | $ | |||||||||||||||||
|
Issuance of common stock for
|
||||||||||||||||||||
|
cash at $0.10 per share
|
1,000 | 100 | ||||||||||||||||||
|
Net loss from inception on
|
||||||||||||||||||||
|
November 8, 2012 to
|
||||||||||||||||||||
|
December 31, 2012
|
(20,868 | ) | ||||||||||||||||||
|
Balance, December 31, 2012
|
$ | 1,000 | $ | 100 | $ | (20,868 | ) | |||||||||||||
See accompanying notes and accountant’s report.
4.
Excel Business Solutions, Inc.
(A Development Stage Company)
Statement of Cash Flows
From November 8, 2012 (Date of Inception) to December 31, 2012
Increase (Decrease) in Cash and Cash Equivalents
|
CASH FLOWS FROM OPERATING ACTIVITIES
|
||||
|
Net (loss)
|
$ | (20,868 | ) | |
|
Adjustments to reconcile net loss to net cash used in operating activities:
|
||||
|
Changes in operating assets and liabilities:
|
||||
|
Accounts payable
|
368 | |||
|
Accrued expenses
|
3,000 | |||
|
Net cash used in operating activities
|
(17,500 | ) | ||
|
CASH FLOWS FROM FINANCING ACTIVITIES
|
||||
|
Issuance of common stock
|
100 | |||
|
Proceeds from advance due to shareholders
|
17,500 | |||
|
Net cash provided by financing activities
|
17,600 | |||
|
NET INCREASE IN CASH
|
100 | |||
|
Cash and cash equivalents, beginning of period
|
-0- | |||
|
CASH AND CASH EQUIVALENTS, END OF PERIOD
|
$ | 100 | ||
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
|
||||
|
Cash paid during the period for interest
|
$ | -0- | ||
|
Cash paid during the period for taxes
|
$ | -0- | ||
|
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES
|
||||
|
For the period ended December 31, 2012
|
NONE
|
|||
See accompanying notes and accountant's report.
5.
Excel Business Solutions, Inc.
(A Development Stage Company)
Notes to Financial Statements
December 31, 2012
1. ORGANIZATION AND OPERATIONS
Excel Business Solutions, Inc. (the “Company”) was organized November 8, 2012 as a Delaware corporation.
Currently, the Company is considered a development stage company as defined by FASB ASC 915-205-45-6. The Company intends to acquire, develop and manage merchant accounts. The Company’s objective is to develop a diversified portfolio and then organically growing the existing portfolio.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Date of Management’s Review of Subsequent Events
Subsequent events were considered through January 7, 2013, which is the date the financialstatements were available to be issued.
Accounting Method
The Company’s financial statements are prepared on the accrual method of accounting.
Revenue Recognition
The Company’s revenue consists of fees from servicing merchant accounts.
Loss Per Share
Basic net loss per share is computed by dividing net loss available for common stock by the weighted average number of common shares outstanding during the period.
Use of Estimates in the Preparation of Financial Statements
The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amount 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.
6.
Excel Business Solutions, Inc.
(A Development Stage Company)
Notes to Financial Statements
December 31, 2012
3. RECENT ACCOUNTING PRONOUNCEMENTS
In December 2011, the FASB issued ASU 2011-12, Comprehensive Income (Topic 220): The amendments in this update supercede certain pending paragraphs in ASU-2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income, to effectively defer only those changes in ASU 2011-05 that relate to the presentation of reclassification adjustments out of accumulated other comprehensive income. The amendments will be temporary to allow the Board time to deliberate the presentation requirements for reclassifications out of accumulated other comprehensive income for annual and interim financial statements for public, private and nonprofit entities. The amendments in this update are effective for public entities for fiscal years, and interim annual periods within those years, beginning after December 15, 2011 consistent with ASU 2011-05. The Company does not anticipate any material impact to the financial statements related to this guidance.
In December 2011, the FASB issued ASU 2011-11, Balance Sheet, Disclosure about Offsetting Assets and Liabilities (Topic 210): The objective of this update is to provide enhanced disclosures that will enable users of its financial statements to evaluate the effect or potential effect of netting arrangements on an entity’s financial position. This includes the effect or potential effect of rights of setoff associated with an entity’s recognized assets and recognized liabilities within the scope of this Update. The amendments require enhancement disclosures by requiring improved information about financial instruments and derivative instruments that are either (1) offset in accordance with either Section 210-20-45 or Section 815-10-45 or (2) subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they offset in accordance with either Section 210-20-45 or Sections 815-10-45. These amendments are effective for annual period beginning on or after January 3, 2013, and interim periods within those annual periods. An entity should provide the disclosures required by those amendments retrospectively for all comparative periods presented. The Company does not anticipate any material impact to the financial statements related to this guidance.
In December 2011, the FASB issued ASU 2011-10, Property, Plant and Equipment (Topic 360): The objective of this update is to resolve the diversity in practice about whether the guidance in the Subtopic 360-20, Property, Plant and Equipment – Real Estate Sales, applies to a parent that ceases to have a controlling financial interest (as described in Subtopic 810-10 Consolidation – Overall) in a subsidiary that is in substance real estate as a result of default on the subsidiary’s nonrecourse debt. This update does not address whether the guidance in Subtopic 360-20 would apply to other circumstances when parent ceases to have a controlling financial interest in a subsidiary that is in substance real estate. An entity is required to apply the amendments for annual reporting periods beginning on or after January 1, 2013, and interim periods within those annual periods. The Company does not anticipate any material impact to the financial statements related to this guidance.
In June 2011, the FASB issued ASU 2011-05, Comprehensive Income (Topic 220): Presentation of Comprehensive Income. This ASU amends the FASB Accounting Standards Codification (Codification) to allow an entity the option to present the total of comprehensive income, the
7.
Excel Business Solutions, Inc.
(A Development Stage Company)
Notes to Financial Statements
December 31, 2012
3. RECENT ACCOUNTING PRONOUNCEMENTS (Continued)
components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. In both choices, an entity is required to present each component of net income along with total net income, each component of other comprehensive income along with a total for other comprehensive income, and a total amount for comprehensive income. ASU 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of changes in stockholder’s equity. The amendments to the Codification in the ASU do not change the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income. ASU 2011-05 should be applied retrospectively. For public entities, the amendments are effective for fiscal years, and interim periods within those years, beginning after December 15, 2011. The Company does not anticipate any material impact to the financial statements related to this guidance.
In May 2011, the FASB issued ASU 2011-04, Fair Value Measurement (Topic 820): Amendments to Achieve Common Fair Value Measurement (Topic 820) and Disclosure Requirement in U.S. GAAP and IFRSs. This ASU represents the converged guidance of the FASB and the IASB (the “Boards”) on fair value measurement. The collective efforts of the Boards and their staff, reflected in ASU 2011-04, have resulted in common requirements for measuring fair value and for disclosing information about fair value measurement, including a consistent meaning of the term “fair value”. The Boards have concluded the common requirements will result in greater comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. GAAP and IFRS. The amendments in this update apply to all reporting entities that are required or permitted to measure or disclose the fair value of an asset, a liability, or an instrument classified in a reporting entity’s shareholders’ equity in the financial statements. The amendments in this ASU are to be applied prospectively. For public entities, the amendments are effective during interim and annual periods beginning after December 15, 2011. The Company does not anticipate any material impact to the financial statements related to this guidance.
In April 2011, the FASB issued ASU 2011-03, Transfers and Servicing (Topic 860): Reconsideration of Effective Control for Repurchase Agreements. The ASU is intended to improve financial reporting of repurchase agreements (“repos”) and other agreements that both entitle and obligate a transferor to repurchase or redeem financial assets before their maturity. The amendments to the Codification in this ASU are intended to improve the accounting for these transactions by removing from the assessment of effective control the criterion requiring the transferor to have the ability to purchase or redeem the financial assets. The amendments in this update apply to all entities, both public and nonpublic. This ASU is effective for the first interim or annual periods beginning on or after December 15, 2011. The guidance should be applies prospectively to transactions or modification of existing transactions that occur on or after the effective date. Early adoption is not permitted. The Company does not anticipate any material impact to the consolidated financial statements related to this guidance.
8.
Excel Business Solutions, Inc.
(A Development Stage Company)
Notes to Financial Statements
December 31, 2012
4. FAIR VALUE MEASUREMENT
Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.
The Company utilizes a valuation hierarchy for disclosure of the inputs to the valuations used to measure fair value. This hierarchy prioritizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3 inputs are unobservable inputs based on the company’s own assumptions used to measure assets and liabilities at fair value. A financial asset or liability’s classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement.
The methods and assumptions used to estimate the fair values of each class of financial instruments are as follows:
Cash, Accounts Payable, Accrued Expenses and Advances Due to Shareholders
The items are generally short-term in nature, and accordingly, the carrying amounts reported in the consolidated statements of financial condition are reasonable approximations of their fair values.
5. INCOME TAXES
The Company accounts for income taxes in accordance with FASB Accounting Standards Codification Topic 740 which requires the Company to provide a net deferred tax asset/liability equal to the expected future tax benefit/expense of temporary reporting differences between book and tax accounting methods and any available operating loss or tax credit carryforwards.
6. STOCKHOLDERS' EQUITY
At December 31, 2012, the Company had 1,000 shares of common stock authorized no par value.
7. LOSS PER SHARE
Loss per share is based on the weighted average number of common shares. Dilutive loss per share was not presented, as the Company as of December 31, 2012 issued no options and no warrants which would have had an antidilutive effect on earnings.
9.
Excel Business Solutions, Inc.
(A Development Stage Company)
Notes to Financial Statements
December 31, 2012
7. LOSS PER SHARE (Continued)
| Loss from continuing operations available to common stockholders | (20,868 | ) | ||
| Weighted average number of common shares outstanding used in earnings per share during the period | 1,000 | |||
| Loss per common share | (20.87 | ) |
8. MERCHANT-BASE FINANCING
The Company has entered into a non-binding letter of intent to enter into a merchant-base financing agreement with borrowings up to $20,000,000 with RBL Capital Group, LLC at a rate to be determined by lender when funds are borrowed. The merchant-base financing agreement would be collateralized by a signed guarantee from all owners of Excel Business Solutions, Inc. and a perfected security interest in all tangible and intangible assets of the Company.
9. ADVANCE DUE TO SHAREHOLDERS
The advance due to shareholders consists of a non-interest bearing unsecured advance of $17,500 at December 31, 2012.
10. RELATED PARTY TRANSACTIONS
The Company has entered into a non-binding letter of intent to enter into a merchant-base financing agreement (see Note 8) with a company which is an affiliate of shareholders of Excel Business Solutions, Inc.
10.