NETSTREIT 8-K/A Financial Statements and Exhibits

NETSMART TECHNOLOGIES, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET (See note A)

JUNE 30, 2005

	Netsmart			CMHC				Pro Forma Adjustments			Combined			Note		Consoldidation Adjustments			Consolidated - Pre Operating Adjustments
Assets:		June 30, 2005			June 30, 2005		Note		June 30, 2005			June 30, 2005
Current Assets:
Cash and Cash Equivalents	$	16,359,627		$	529,984		(A1)	$	(12,994,758	)	$	10,612,957							$	10,612,957
									4,218,104						(A2)
									2,500,000						(A3)
Accounts Receivable Net		9,010,691			1,688,121							10,698,812								10,698,812
Costs and Estimated Profits in Excess																				-
of Interim Billings		831,057										831,057								831,057
Deferred taxes		1,030,000			294,674							1,324,674								1,324,674
Other Current Assets		772,305			1,024,625							1,796,930			(A8)		(69,754	)		1,727,176
Total Current Assets	$	28,003,680		$	3,537,404				($6,276,654	)	$	25,264,430				$	(69,754	)	$	25,194,676
Property and Equipment Net		2,427,944			527,535							2,955,479								2,955,479
Other Assets:
Software Development Costs - Net		3,561,024			1,490,238							5,051,262			(A4a)	$	1,809,762			6,861,024
Customer Lists - Net		3,183,411										3,183,411			(A4b)		5,300,000			8,483,411
Capitalized Backlog												-			(A4c)		502,000			502,000
Goodwill												-			(A6)		18,760,003			18,760,003
Deferred taxes less current portion		1,074,000			940,128							2,014,128								2,014,128
Investment in CMHC							(A1)		19,565,956			19,565,956			(A7)		(19,565,956	)		-
Other Assets		104,246			26,208							130,454								130,454
Total Other Assets		7,922,681			2,456,574				19,565,956			29,945,211					6,805,809			36,751,020
Total Assets	$	38,354,305		$	6,521,513			$	13,289,301		$	58,165,119				$	6,736,055		$	64,901,174
Liabilities and Stockholders' Equity:
Current Liabilities:
Current Portion - Long Term Debt	$	666,699		$	470,118		(A3)	$	500,000		$	1,636,817								1,636,817
Current Portion Capital Lease Obligations		54,394		$	10,035							64,429								64,429
Accounts Payable		1,469,763		$	677,000							2,146,763								2,146,763
Accrued Expenses		1,146,917			1,161,047		(A1)		1,656,106			3,964,070			(A8)		60,663			4,024,733
Interim Billings in Excess of Costs and Estimated																				-
Profits		6,917,950										6,917,950								6,917,950
Deferred Revenue		1,924,311			7,907,131							9,831,442			(A8)		(517,438	)		9,314,004
Total Current Liabilities		12,180,034			10,225,331				2,156,106			24,561,471					(456,775	)		24,104,696
Long Term Debt - Less current portion		-			17,695		(A3)		2,000,000			2,017,695								2,017,695
Capital Lease Obligations - Less current portion		-			12,317							12,317								12,317
Interest Rate Swap at Fair Value		5,008										5,008								5,008
Deferred taxes												-			(A5)	$	3,459,000			3,459,000
Deferred Rent Payable		475,050										475,050								475,050
Total Non Current Liabilities		480,058			30,012				2,000,000			2,510,070					3,459,000			5,969,070
Commitments and Contingencies
Stockholders' Equity:
Preferred Stock		-			-							-								-
Common Stock		55,995			14,220		(A1)		4,357			79,472			(A7)		(14,220	)		65,252
									4,900						(A2)
Additional Paid in Capital		30,137,495			1,008,287		(A1)		4,910,734			40,269,720			(A7)		(1,008,287	)		39,261,433
									4,213,204						(A2)
Accumulated Comprehensive loss - Interest Rate Swap		(5,008	)									(5,008	)							(5,008	)
Accumulated Deficit		(2,781,287	)		(4,756,337	)						(7,537,624	)		(A7)		4,756,337			(2,781,287	)
		27,407,195			(3,733,830	)			9,133,195			32,806,560					3,733,830			36,540,390
Less: cost of shares of Common Stock held
in treasury - 227,924 shares at June 30, 2005
and December 31, 2004		1,712,982										1,712,982								1,712,982
Total Stockholders' Equity		25,694,213			(3,733,830	)			9,133,195			31,093,578					3,733,830			34,827,408
Total Liabilities and Stockholders' Equity	$	38,354,305		$	6,521,513			$	13,289,301		$	58,165,119				$	6,736,055		$	64,901,174
See Notes to Pro Forma Condensed Consolidated Financial Statements.

NETSMART TECHNOLOGIES, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME

FOR THE YEAR ENDED DECEMBER 31, 2004

	Netsmart			CMHC consolidated			Less 570 Metro Place North Limited Partnership			CMHC			AMS								Consolidated
	12/31/2004			3/31/2005			3/31/2005			3/31/2005			12/31/2004		Note			Pro Forma Adjustments			Year End 2004
Revenues:
Software and Related
Systems and Services:
General	$	16,931,606		$	5,340,220					$	5,340,220		$	598,654							$	22,870,480
Maintenance Contract Services		8,289,525			16,460,035						16,460,035			1,302,372								26,051,932
Total Software and Related Systems & Services		25,221,131			21,800,255						21,800,255			1,901,026					-			48,922,412
Application Service Provider Services		1,725,473																				1,725,473
Data Center Services		2,058,240																				2,058,240
Total Revenues		29,004,844			21,800,255						21,800,255			1,901,026					-			52,706,125
Cost of Revenues:
Software and Related
Systems and Services:
General		9,203,071			2,684,231						2,684,231			147,991		(B1a	)		1,583,337			12,931,371
																(B1b	)		(687,258	)
Maintenance Contract Services		4,168,975			6,493,320						6,493,320			1,026,503								11,688,798
Total Software and Related Systems & Services		13,372,046			9,177,551						9,177,551			1,174,493					896,078			24,620,168
Application Service Provider Services		926,333																				926,333
Data Center Services		849,353																				849,353
Total Cost of Revenues		15,147,732			9,177,551						9,177,551			1,174,493					896,078			26,395,854
Gross Profit		13,857,112			12,622,704						12,622,704			726,533					(896,078	)		26,310,270
Selling, General and Administrative Expenses		7,293,865			8,995,584			298,260			9,293,844			588,527		(B1c	)	$	439,613			17,615,849
Research, Development and Maintenance		3,498,448			4,663,100						4,663,100											8,161,548
Total		10,792,313			13,658,684			298,260			13,956,944			588,527					439,613			25,777,397
Operating Income		3,064,799			(1,035,980	)		(298,260	)		(1,334,240	)		138,005					(1,335,691	)		532,874
Interest and Other Income		126,379			24,878						24,878											151,257
Minority Interest - Partnership					(159,218	)		159,218
Interest and Other Expense		(129,213	)		(213,949	)		135,085			(78,864	)				(B3	)		(160,506	)		-368,583
Income before Income Tax Expense		3,061,965			(1,384,269	)		(3,957	)		(1,388,226	)		138,005					(1,496,196	)		315,548
Income Tax Expense		309,000			254,910			3,957			(258,867	)				(B2	)		69,775			119,908
Net Income	$	2,752,965			($1,129,359	)	$	0			($1,129,359	)	$	138,005					($1,565,971	)	$	195,640
Earnings Per Share ("EPS") of Common Stock:
Basic EPS	$	0.52																			$	0.03
Weighted Average Number of Shares of Common Stock Outstanding		5,331,700														(B4	)		925,735			6,257,435
Diluted EPS	$	0.50																			$	0.03
Weighted Average Number of Shares of Common Stock and Common Stock
Equivalents Outstanding		5,536,731														(B4	)		925,735			6,462,466

NETSMART TECHNOLOGIES, INC. AND SUBSIDIARIES

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENTS OF INCOME

FOR THE SIX MONTHS ENDED JUNE 30, 2005

	Netsmart		CMHC		AMS		Note		Pro Forma Adjustments			Consolidated
	Six months ended		Six months ended		Six months ended				Six months ended			Six months ended
Revenues:	June 30, 2005		June 30, 2005		June 30, 2005				June 30, 2005			June 30, 2005
Software and Related
Systems and Services:
General	$	8,663,661	$	3,489,377	$	625,063							12,778,101
Maintenance Contract Services		4,445,033		8,934,716		742,529							14,122,278
Total Software and Related Systems & Services		13,108,694		12,424,093		1,367,593				-			26,900,379
Application Service Provider Services		1,133,046											1,133,046
Data Center Services		946,258											946,258
Total Revenues		15,187,998		12,424,093		1,367,593				-			28,979,683
Cost of Revenues:
Software and Related
Systems and Services:
General		4,500,663		1,303,949		119,204		(B1a)		791,668			6,592,514
								(B1b)		(122,970	)
Maintenance Contract Services		2,111,381		3,338,160		448,178							5,897,719
Total Software and Related Systems & Services		6,612,044		4,642,109		567,383				668,698			12,490,233
Application Service Provider Services		664,082											664,082
Data Center Services		449,624											449,624
Total Cost of Revenues		7,725,750		4,642,109		567,383				668,698			13,603,939
Gross Profit		7,462,248		7,781,984		800,210				(668,698	)		15,375,744
Selling, General and Administrative Expenses		4,358,585		4,647,105		184,654		(B1c)	$	219,806			9,410,151
Research, Development and Maintenance		1,969,303		2,068,400									4,037,703
Total		6,327,888		6,715,505		184,654				219,806			13,447,854
Operating Income		1,134,360		1,066,479		615,556				(888,504	)		1,927,891
Interest and Other Income		145,694		8,863									154,557
Interest and Other Expense		37,433		40,084				(B3)		83,063			160,580
Income before Income Tax Expense		1,242,621		1,035,258		615,556				(971,567	)		1,921,868
Income Tax Expense		430,000		271,827				(B2)		28,483			730,310
Net Income	$	812,621	$	763,431	$	615,556			$	(1,000,050	)	$	1,191,558
Earnings Per Share ("EPS")of Common Stock:
Basic EPS	$	0.15										$	0.19
Weighted Average Number of Shares of
Common Stock Outstanding		5,354,968						(B4)		925,735			6,280,703
Diluted EPS	$	0.15										$	0.18
Weighted Average Number of Shares of
Common Stock and Common Stock
Equivalents Outstanding		5,570,611						(B4)		925,735			6,496,346
See Notes to Pro Forma Condensed Consolidated Financial Statements.

NETSMART TECHNOLOGIES, INC. AND SUBSIDIARIES

NOTES TO UNAUDITED PRO FORMA CONDENSED

CONSOLIDATED FINANCIAL STATEMENTS

1.      BASIS OF PRESENTATION

Pursuant to the merger agreement dated September 20, 2005, Netsmart Technologies, Inc. (“Netsmart” or the “Company”) acquired 100% of the equity of CMHC Systems, Inc. (“CMHC”). The purchase price totaled $19,565,956 as follows: 435,735 shares of Netsmart’s common stock (valued at $4,915,091), $12,994,758 in cash plus additional cash consideration currently estimated to be $792,024 as required by the “working capital adjustment” calculated and payable as defined in the merger agreement (subject to adjustment, see Note 2), and acquisition costs of $864,083. The cash consideration was paid utilizing the working capital of Netsmart. The acquisition has been accounted for under the purchase method of accounting in accordance with SFAS No. 141 by which the acquiring company records at its cost the acquired assets less liabilities assumed.

Pursuant to the asset purchase agreement dated June 20, 2005, the Company acquired certain assets and liabilities and rights to the intellectual property and customer contracts of Addiction Management Systems, Inc. (“AMS”). The purchase price was $3,590,778, which consisted of $948,833 of liabilities assumed for pre billed services plus $2,641,945 in cash. The source of the cash consideration was the working capital of Netsmart. The purchase has been accounted for under the purchase method of accounting in accordance with SFAS No. 141.

On October 7, 2005, Netsmart entered into a Loan Agreement consisting of (i) a $2,500,000 Revolving Credit Loan and (ii) a $2,500,000 Term Loan. On October 7, 2005, the Netsmart borrowed the full amount of the $2,500,000 Term Loan. On October 14, 2005, Netsmart issued 490,000 shares of common stock and 147,004 common stock purchase warrants in a private placement generating net proceeds of $4,218,000.

2.      PRO FORMA ADJUSTMENTS

CMHC Merger

CMHC reports on a fiscal year end of March 31 and, as a result, the pro forma statement of operations for the year ended December 31, 2004 is inclusive of CMHC operations for the period of January 1, 2005 thru March 31, 2005. CMHC revenue and net income for the three months ended March 31, 2005 were $6,559,865 and $569,045 respectively.

Netsmart purchased 100% of the equity of CMHC. Netsmart did not purchase 570 Metro Place North Limited Partnership, an entity that is majority-owned by CMHC’s former majority stockholder and owns the land and the building where CMHC conducts most of its operations. The breakdown of the allocation of the assets is subject to adjustment. The total acquisition cost is based upon certain estimates and is also subject to adjustment.

The following are the details of the total acquisition cost:

Cash paid	$	12,994,758
Market value of common stock issued		4,915,091
Estimated working capital adjustment *		792,024
Other acquisition costs		864,083
Total acquisition	$	19,565,956

The total cost of acquisition was allocated as follows **:

Current assets	$	3,467,650
Property and equipment		527,535
Customer lists		5,300,000	(to be amortized over 20 years)
Backlog		502,000	(to be amortized over 1 year)
Software purchased		3,300,000	(to be amortized over 4 years)

Goodwill		18,760,003
Deferred taxes, long-term		940,128
Other assets		26,208
Total assets		32,823,524
Current liabilities		(9,768,556	)
Long-term obligations		(30,012	)
Deferred taxes, long-term		(3,459,000	)
Total liablitites		(13,257,568	)
Total acquisition allocation	$	19,565,956

* The working capital adjustment of an estimated $792,024 is based upon the terms of the merger agreement whereby the purchase price will include an amount equal to the amount that the final net working capital of CMHC is greater than a negative $7.5 million. This estimate is based upon the unaudited balance sheet of CMHC as of September 30, 2005 and is subject to adjustment.

** The primary fair value adjustments made to CMHC’s historical cost balance sheet were to increase the value of CMHC’s software to fair value, and to record customer lists, contract backlog and goodwill and the related deferred tax liability, as well as to adjust the fair value of deferred revenue (see Note A8). For all other assets and liabilities, historical cost approximated fair value.

·   In order to value CMHC’s software, management considered the historical costs incurred as well as projected costs to recreate the software. However, since there is a specific earnings stream that can be associated exclusively with the existing software, management applied a discounted cash flow model in its estimation of the fair value of the software. CMHC’s software consists of management information systems used by behavioral and public health organizations; the systems include financial, client administration, clinical assessment and administration. The estimated useful life of the software is four years. Such estimate considered the following: (i) the software is an integral part of each customer’s operations and is not easily replaced, (ii) however, the underlying architecture of the software is based on unsupported programming language and character-based screens (not the graphical interfaces used today) and will need to be updated, and (iii) the results of the discounted cash flow analysis.

·   The customer list has been valued using a discounted cash flow model. CMHC provides computer-based management information systems for approximately 400 behavioral and public healthcare organizations. CMHC’s relationships with its customers are long-term in nature, indicating that the customer relationships are an important intangible asset to the Company. CMHC has been in business since 1978, and based upon their historical attrition rate, and the 30 year projections used for the cash flow analysis, the useful life of the customer lists is estimated to be 20 years.

·   The contract backlog represents the fair value of various customer contracts and purchase orders that have already been billed to the customers, but for which services have not yet been performed. The value was determined using a discounted cash flow model. The contract backlog is being amortized over 12 months, since the services to be performed with respect to the underlying customer contracts are expected to be completed within one year.

·   The deferred tax liability represents a long term deferred tax liability related to the above fair valuation adjustments for the capitalized software, customer list and contract backlog intangible assets. These intangibles are not deductible expenses for tax purposes. The tax effect has been calculated utilizing Netsmart's blended statutory tax rate of 38%.

·   Goodwill represents the excess of the cost of CMHC over the net of the amounts assigned to tangible and identifiable intangible assets acquired and liabilities assumed. The goodwill is not amortized for book or income tax purposes.

The Company only recently purchased CMHC, and accordingly, is still gathering data related to the allocation of the purchase price. As such, the purchase price allocation is subject to change. Changes could include a reallocation of intangible assets which would likely have the effect of increasing or decreasing future amortization expense, since the intangible assets have initially been assigned varied lives ranging from no amortization (for goodwill) to 20 year amortization (for the customer list). Additionally, the lives assigned to the identifiable intangible assets represent management’s best estimates of the time period in which it will continue to receive benefits from these assets. The useful lives may need to be adjusted in the future based upon changes to the expected useful lives of such assets. As a result, future amortization expense could be materially different from the pro forma amortization expense presented herein.

Strategic headcount adjustments related to the CMHC merger decreasing cost of sales and selling, general and administrative expenses have not been reflected in the pro forma adjustments to the statement of operations. These adjustments are the result of planned strategic employee terminations that occurred on and shortly after the closing date of the merger.

Consulting contracts were entered into with several senior executives of CMHC ranging in duration from day-to-day to up to six months. These contracts, in effect, replace the salaries of the executives and, as a result, do not have a significant impact on operations going forward.

As a result of the merger, Netsmart assumed the lease agreement on the premises located at 570 Metro Place North in Dublin, Ohio. The subject building is owned by CMHC’s former majority stockholder who is a current employee of Netsmart. Netsmart has reviewed Fin 46 R and has determined that the consolidation is not required. The lease ends on October 31, 2013 and, based upon research of comparable rental property, Netsmart has determined that the current rent being paid under the terms of the lease represents a fair market price for leases currently being negotiated in that market. In addition, the rental payments that are required for the next twelve months approximate the rental payments that have been made over the past year by CMHC and, as a result, no pro forma adjustment has been made.

Subsequent to the acquisition of CMHC, Netsmart sold to investors , pursuant to a private placement agreement (the “Agreement”), an aggregate 490,000 shares of common stock and warrants to purchase 122,504 shares of common stock. Netsmart has received $4,493,104 in gross proceeds and paid commissions of $275,000 related to the private placement. Netsmart has also issued a warrant to purchase 24,500 shares to the placement agent. The Agreement requires Netsmart to file a registration statement within 30 days of the closing of the private placement, and to use its reasonable best efforts to have such registration statement declared effective by the SEC within 90 days of the closing. Generally, the Agreement further provides for a penalty to be paid to the investors should Netsmart fail to meet its registration obligations. Such penalty is payable to the investors in cash at the rate of 2.5% of the gross proceeds per month, up to a maximum penalty of 20% of the gross proceeds. Netsmart has accounted for the proceeds of the private placement as equity in accordance with View A of EITF 05-04. Any potential penalties incurred pursuant to the registration rights agreement will be recorded in earnings when and if incurred as per SFAS 5.

Addiction Management Systems, Inc. Asset Purchase

Netsmart did not purchase any of the assets on the AMS balance sheet other than the purchase of certain inventory items utilized to resell to then-existing clients, the value of which has been recorded as $32,048, certain accounts receivable in the amount of $127,698 and a lease security deposit in the amount of $3,334. Netsmart did not assume any of the liabilities reflected on the AMS balance sheet other than for contract performance related to revenue collected from clients in advance of performance of work contracted for in the amount of $948,833.

The following are the details of the total acquisition cost:

Cash paid	$	2,641,945
Liabilities assumed		948,833
Other acquisition costs		19,904
Total acquisition	$	3,610,682

The total cost of acquisition was allocated as follows:

Customer lists	$	1,396,902	(to be amortized over 8 years	)
Software purchased		2,050,700	(to be amortized over 8 years	)
Accounts Receivable purchased		127,698
Inventory purchased		32,048
Lease security deposit		3,334
Total acquisition allocation	$	3,610,682

Pro forma adjustments were made to the unaudited condensed consolidated statements of operations for the year ended December 31, 2004 and for the six months ended June 30, 2005 to reflect amortization of $430,950 and $215,475, respectively, for customer lists and software purchased.

The following are the notes explaining pro forma adjustments to the unaudited condensed consolidated balance sheet as of June 30, 2005:

(A)	The acquired assets and liabilities of AMS are already incorporated in the Netsmart consolidated balance sheet as of June 30, 2005. This acquisition occurred prior to the balance sheet date and is therefore not shown separately for pro forma balance sheet purposes.
(A1)	This adjustment represents the recording of Netsmart's acquisition of CMHC totaling $19,565,956. The investment was paid for with cash consideration of $12,994,758, the market value of 435,735 shares of common stock issued of $4,915,091; the working capital adjustment of an estimated $792,024, and certain other costs of completing the acquisition of $864,083 are included in accrued expenses (reflecting an aggregate of $1,656,106).
(A2)	On October 14, 2005, Netsmart sold in a private placement an aggregate 490,000 shares of common stock and warrants to purchase 122,504 shares of common stock. Netsmart received $4,218,104 (net of commissions of $275,000) related to the private placement. Netsmart also issued to the placement agent a warrant to purchase 24,500 shares of common stock. All of the warrants have an exercise price of $11.00 and have a term of 5 years.
(A3)	On October 7, 2005, Netsmart entered into a Loan Agreement consisting of (i) a $2,500,000 Revolving Credit Loan and (ii) a $2,500,000 Term Loan. On October 7, 2005, Netsmart borrowed the full amount of the $2,500,000 Term Loan. Netsmart has not borrowed any amounts under the Revolving Credit Loan. The principal amount of the Term Loan is payable in sixty (60) consecutive monthly installments. The unpaid principal amount of the Term Loan bears interest at the LIBOR Rate plus 2.25%, which rate was swapped into a fixed rate equivalent of 7.1% for the term of the Term Loan.
(A4)	These amounts represent the adjustments to the historical cost balance sheet of CMHC to bring the balances to estimated fair value. The software development costs, the customer lists and the contract backlog are currently expected to be amortized over 4, 20 and 1 years, respectively.
	(A4a) Represents the fair value of software purchased ($3,300,000) less existing historical value of CMHC software ($1,490,238).
	(A4b) Represents the fair value of the CMHC customer list.
	(A4c) Represents the fair value of the CMHC customer backlog.
(A5)	This consolidation adjustment represents the recording of a long term deferred tax liability related to the fair valuation adjustments for the capitalized software, customer list and contract backlog intangible assets. These intangibles are not deductible expenses for tax purposes. The tax effect has been calculated utilizing Netsmart's blended statutory tax rate of 38%. This results in a long term deferred tax liability of $3,459,000.
(A6)	This represents the excess of the purchase price of CMHC (including currently estimated adjustments) over the fair value of the assets acquired and liabilities assumed.
(A7)	This consolidation adjustment represents the elimination of Netsmart’s investment in CMHC and the elimination of CMHC’s equity.
(A8)	These pro forma amounts represent adjustments to the historical cost balance sheet of CMHC to bring the balances to estimated fair value. The $517,438 adjustment to deferred revenue represents $214,438 for which there is no performance obligation and a $304,000 adjustment to eliminate future gross profit related to sales efforts incurred prior to the acquisition date.

Pro forma adjustments were made to the unaudited condensed consolidated statements of operations for the year ended December 31, 2004 and the six months ended June 30, 2005 to reflect changes resulting from the merger that are directly attributable, factually supportable and are expected to have continuing impact on the combined operations. The following are the notes explaining such pro forma adjustments:

(B1a) The adjustment increasing cost of sales is due mainly to the amortization of the of the acquired software related to the CMHC merger and the amortization of the acquired software related to the AMS acquisition. The amounts specific to each acquisition are as follows:

	Year ended		Six Months ended
	December 31, 2004		June 30, 2005
CMHC	$	1,327,000	$	663,500
AMS		256,337		128,168
Total	$	1,583,337	$	791,668

(B1b)	The adjustment decreasing cost of sales is the result of eliminating amortization of the acquired software that is already reflected in the historical statements of operations.
(B1c)	The adjustment increasing selling, general and administrative expenses is due mainly to the amortization of the customer list related to the CMHC merger and the amortization of customer list related to the AMS acquisition. The amounts specific to each acquisition are as follows:

	Year ended		Six Months ended
	December 31, 2004		June 30, 2005
CMHC	$	265,000	$	132,500
AMS		174,613		87,306
Total	$	439,613	$	219,806

(B2)	The adjustment to the income tax provision is to reflect the overall 38% normal tax rate for Netsmart.
(B3)	This adjustment represents interest expense on the Term Loan entered into on October 7, 2005.
(B4)	The pro forma adjustment to the number of common shares outstanding is a direct result of:
	1. The issuance of 435,735 shares related to the CMHC merger.
	2. The shares issued pursuant to the private placement contracts resulting in the issuance of 490,000 shares of common stock and warrants to purchase 122,504 shares of common stock plus an additional warrant to purchase 24,500 shares of common stock issued to the placement agent.
	The common shares issued have been reflected in both the basic and diluted earnings per share calculation and the warrants issued to purchase common stock have not been reflected in the diluted earning per share calculation as the result would be antidilutive.