Exhibit 99.1
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
The following unaudited pro forma combined financial statements present financial information after giving effect to the acquisition of Clinton County Bio Energy, L.L.C. (“CCBE”) by Nova Biosource Fuels, Inc. (“Nova”). Nova will acquire substantially all of the assets and assume the liabilities of CCBE. This transaction is expected to close during September 2007 and will be effective as of September 1, 2007.
The pro forma financial statements give effect to this proposed transaction under the purchase method of accounting. The pro forma combined statement of operations includes historical information of Nova for the year ended July 31, 2007, historical information of CCBE for the year ended June 30, 2007, and includes adjustments which give effect to the transaction as if it had occurred on August 1, 2006. The pro forma combined balance sheet includes adjustments which give effect to the transaction as if it had occurred on July 31, 2007. The notes to the pro forma combined financial statements describe the pro forma adjustments.
The pro forma combined financial statements do not attempt to show how Nova would actually have performed or its financial position had the transaction occurred at the dates indicated. Also, they do not attempt to predict or suggest future operating results or financial position.
These unaudited pro forma combined financial statements and the accompanying notes should be read in conjunction with the audited financial statements of Nova and CCBE.
NOVA BIOSOURCE FUELS, INC. and CLINTON COUNTY BIO ENERGY, L.L.C.
Pro Forma Combined Statement of Operations
Year ended July 31, 2007 (Unaudited)
| | Nova Biosource | | Clinton County | | | | Pro Forma | |
| | Fuels, Inc. | | Bio Energy, | | | | Combined | |
| | Year ended | | L.L.C. Year | | Pro Forma | | Statement of | |
| | 7/31/2007 | | ended 6/30/2007 | | Adjustments | | Operations | |
Revenues: | | | | | | | | | |
Biodiesel sales | | — | | 12,598,000 | | — | | 12,598,000 | |
Contracting revenues | | 30,039,000 | | — | | — | | 30,039,000 | |
Services revenues | | 125,000 | | — | | — | | 125,000 | |
Total revenues | | 30,164,000 | | 12,598,000 | | — | | 42,762,000 | |
| | | | | | | | | |
Costs and Expenses: | | | | | | | | | |
Cost of biodiesel sales | | — | | 15,180,000 | | (254,000 | ) | 14,926,000 | |
Contracting expenses | | 40,311,000 | | — | | — | | 40,311,000 | |
Selling, general and admin | | 21,541,000 | | 170,000 | | — | | 21,711,000 | |
Total costs and expenses | | 61,852,000 | | 15,350,000 | | (254,000 | ) | 76,948,000 | |
| | | | | | | | | |
Loss from operations | | (31,688,000 | ) | (2,752,000 | ) | 254,000 | | (34,186,000 | ) |
| | | | | | | | | |
Other income(expense): | | | | | | | | | |
Interest and other income | | 1,753,000 | | 2,000 | | (352,000 | ) | 1,403,000 | |
Interest expense | | (1,430,000 | ) | (160,000 | ) | — | | (1,590,000 | ) |
Minority interest in earnings of subsidiary | | (8,000 | ) | — | | — | | (8,000 | ) |
| | | | | | | | | |
Net loss | | (31,373,000 | ) | (2,910,000 | ) | (98,000 | ) | (34,381,000 | ) |
| | | | | | | | | |
Basic and diluted net loss per share | | | | | | | | (0.32 | ) |
| | | | | | | | | |
Weighted average number of shares outstanding | | | | | | | | 106,377,430 | |
NOVA BISOURCE FUELS, INC. and CLINTON COUNTY BIO ENERGY, L.L.C.
Pro Forma Combined Balance Sheet
July 31, 2007 (Unaudited)
| | Nova | | Clinton | | | | | |
| | Biosource | | County Bio | | | | Pro Forma | |
| | Fuels, Inc. | | Energy, L.L.C. | | Pro Forma | | Combined | |
| | 7/31/2007 | | 6/30/2007 | | Adjustments | | Balance Sheet | |
| | | | | | | | | |
ASSETS | | | | | | | | | |
Cash and cash equivalents | | 16,904,000 | | — | (c) | (7,821,000 | ) | 9,083,000 | |
Accounts receivable | | 33,000 | | 724,000 | | | | 757,000 | |
Inventories | | — | | 502,000 | | | | 502,000 | |
Costs and estimated earnings in excess of billings on uncompleted contracts | | 6,573,000 | | | | | | 6,573,000 | |
Other current assets | | 590,000 | | 20,000 | (e) | (11,000 | ) | 599,000 | |
Total current assets | | 24,100,000 | | 1,246,000 | | (7,832,000 | ) | 17,514,000 | |
| | | | | | | | | |
Fixed Assets | | 41,020,000 | | 6,897,000 | (f) | 3,550,000 | | 51,467,000 | |
Accumulated depreciation | | (211,000 | ) | (841,000 | (f) | 841,000 | | (211,000 | ) |
Net fixed assets | | 40,809,000 | | 6,056,000 | | 4,391,000 | | 51,256,000 | |
| | | | | | | | | |
Intangible assets, net | | 6,026,000 | | — | | | | 6,026,000 | |
| | | | | | | | | |
Total assets | | 70,935,000 | | 7,302,000 | | (3,441,000 | ) | 74,796,000 | |
| | | | | | | | | |
LIABILITIES AND EQUITY | | | | | | | | | |
Accounts payable | | 4,744,000 | | 365,000 | | | | 5,109,000 | |
Accrued expenses | | 9,098,000 | | 28,000 | (d) | 150,000 | | 9,276,000 | |
Current portion of long-term debt | | — | | 314,000 | | | | 314,000 | |
| | | | | | | | | |
Total current liabilities | | 13,842,000 | | 707,000 | | 150,000 | | 14,699,000 | |
| | | | | | | | | |
Long-term debt, less current portion | | 2,520,000 | | 3,004,000 | | | | 5,524,000 | |
| | | | | | | | | |
Total liabilities | | 16,362,000 | | 3,711,000 | | 150,000 | | 20,223,000 | |
| | | | | | | | | |
Minority interest | | 4,008,000 | | — | | | | 4,008,000 | |
| | | | | | | | | |
Members’ equity | | — | | 3,591,000 | (e)(g) | (3,591,000 | ) | — | |
| | | | | | | | | |
Stockholders’ equity | | 50,565,000 | | — | | — | | 50,565,000 | |
| | | | | | | | | |
Total Liabilities and Equity | | 70,935,000 | | 7,302,000 | | (3,441,000 | ) | 74,796,000 | |
NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
Pro forma adjustments on the combined statement of operations are as follows:
(a) Represents change of depreciation expense after the fair value adjustment to fixed assets and conforming estimated useful lives.
(b) Represents a reduction of interest income when considering the cash purchase price was paid at the beginning of the period.
Pro forma adjustments on the combined balance sheet are as follows:
(c) Represents cash used to fund the asset purchase.
(d) Represents the direct costs of the acquisition.
(e) Represents assets not acquired.
(f) Represents fair value adjustment to fixed assets.
(g) Represents elimination of historical balance of members’ capital.
