EXHIBIT 99.3
INTRODUCTION TO ANNUAL PRO FORMA
FINANCIAL STATEMENTS
(Unaudited)
Introduction
The following annual pro forma balance sheet, annual pro forma statement of operations, and explanatory notes give effect to the exchange of stock and reverse merger between Extreme Mobile Coatings, Inc. (“Extreme”) and Falcon Media Services, Ltd. (“Falcon”), and are unaudited.
The annual pro forma balance sheet, annual pro forma statement of operations, and explanatory notes are based on the estimates and assumptions set forth in the explanatory notes. The annual pro forma balance sheet and the annual pro forma statement of operations have been prepared utilizing the historical financial statements of Falcon and Extreme and should be read in conjunction with the historical financial statements and notes thereto.
The annual pro forma balance sheet and statement of operations have been prepared as if the exchange of stock and reverse merger had been consummated on January 01, 2007, and carried through to December 31, 2007.
This annual pro forma financial data is provided for illustrative purposes only, and does not purport to be indicative of the actual financial position or results of operations had the exchange of stock and reverse merger occurred at the beginning of the fiscal period presented, nor is it necessarily indicative of the results of future operations.
FALCON MEDIA SERVICES, LTD.
(A Development Stage Company)
Annual Pro Forma Balance Sheet
As of December 31, 2007
(Unaudited)
Falcon | Extreme | |||||||||||||
Media | Mobile | |||||||||||||
Services, Ltd. | Coatings, Inc. | Pro Forma | ||||||||||||
01/31/08 | 12/31/07 | Adjustments | Pro Forma | |||||||||||
ASSETS | ||||||||||||||
Current Assets: | ||||||||||||||
| Cash in bank | $ | 1,080 | $ | 9,057 | $ | - | $ | 10,137 | ||||||
| Prepaid expenses | 53,667 | - | - | 53,667 | ||||||||||
| Total current assets | 54,747 | 9,057 | - | 63,804 | ||||||||||
Property and Equipment: | ||||||||||||||
| Office and computer equipment | - | 5,514 | - | 5,514 | ||||||||||
| Less - Accumulated depreciation | - | (539 | ) | - | (539 | ) | ||||||||
| Net property and equipment | - | 4,975 | - | 4,975 | ||||||||||
Other Assets: | ||||||||||||||
| License agreement, net | - | 49,502 | - | $ | 49,502 | |||||||||
| Servicemark, net | - | 974 | - | 974 | ||||||||||
| Total other assets | - | 50,476 | - | 50,476 | ||||||||||
Total Assets | $ | 54,747 | $ | 64,508 | $ | - | $ | 119,255 | ||||||
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ||||||||||||||
Current Liabilities: | ||||||||||||||
| Current portion of long-term debt | $ | - | $ | 71,280 | $ | - | $ | 71,280 | ||||||
| Accounts payable - Trade | - | 12,500 | - | 12,500 | ||||||||||
| Accrued liabilities | 1,500 | 13,636 | - | 15,136 | ||||||||||
| Due to related parties | 16,234 | 27,280 | - | 43,514 | ||||||||||
| Due to unrelated party | 7,647 | - | - | 7,647 | ||||||||||
| Total current liabilities | 25,381 | 124,696 | - | 150,077 | ||||||||||
Long-term Debt, less current portion: | ||||||||||||||
| Bank loan | - | 284,506 | - | 284,506 | ||||||||||
| Total long-term debt | - | 284,506 | - | 284,506 | ||||||||||
| Total liabilities | 25,381 | 409,202 | - | 434,583 | ||||||||||
Commitments and Contingencies | ||||||||||||||
Stockholders' Equity (Deficit): | ||||||||||||||
| Common stock | 4,410 | 12,891 | 13,505 | (1) | 17,915 | |||||||||
| (12,891 | ) | (2) | ||||||||||||
| Additional paid-in capital | 137,935 | 64,032 | (113,593 | ) | (2) | 88,374 | ||||||||
| (Deficit) accumulated during the development stage | (111,317 | ) | (421,617 | ) | 111,317 | (2) | (421,617 | ) | ||||||
| Other accumulated comprehensive (loss) | (1,662 | ) | - | 1,662 | (2) | - | ||||||||
Total Stockholders' Equity (Deficit) | 29,366 | (344,694 | ) | - | (315,328 | ) | ||||||||
Total Liabilities and Stockholders' Equity (Deficit) | $ | 54,747 | $ | 64,508 | $ | - | $ | 119,255 | ||||||
FALCON MEDIA SERVICES, LTD.
(A Development Stage Company)
Annual Pro Forma Statement of Operations
For the Year Ended December 31, 2007
(Unaudited)
Falcon | Extreme | |||||||||||||
Media | Mobile | |||||||||||||
Services, Ltd. | Coatings, Inc. | Pro Forma | ||||||||||||
01/31/08 | 12/31/07 | Adjustments | Pro Forma | |||||||||||
Revenues | $ | - | $ | - | $ | - | $ | - | ||||||
Expenses: | ||||||||||||||
| General and administrative | 41,158 | 40,198 | (41,158 | ) | (2) | 40,198 | ||||||||
| Depreciation and amortization | - | 2,977 | - | 2,977 | ||||||||||
| Total expenses | 41,158 | 43,175 | (41,158 | ) | 43,175 | |||||||||
(Loss) from operations | (41,158 | ) | (43,175 | ) | 41,158 | (43,175 | ) | |||||||
Other Income (Expense) | ||||||||||||||
| Interest expense | - | (21,641 | ) | - | (21,641 | ) | ||||||||
| Loss on asset purchase agreement | - | (356,801 | ) | - | (356,801 | ) | ||||||||
| Total other Income (Expense) | - | (378,442 | ) | - | (378,442 | ) | ||||||||
Provision for income taxes | - | - | - | - | ||||||||||
Net (loss) | (41,158 | ) | (421,617 | ) | 41,158 | (421,617 | ) | |||||||
Other comprehensive (loss): | ||||||||||||||
| Foreign currency translation | (321 | ) | - | 321 | (2) | - | ||||||||
Comprehensive (loss) | $ | (41,479 | ) | $ | (421,617 | ) | $ | 41,479 | $ | (421,617 | ) | |||
Net Loss Per Share - Basic and Diluted | $ | (0.57 | ) | $ | (0.03 | ) | $ | (0.03 | ) | |||||
Weighted Average Shares Outstanding | 72,488 | 12,891,218 | 13,505,085 | (1) | 13,577,573 | |||||||||
Notes:
60;
| (1) | To record the issuance of 13,505,085 shares of common stock by Falcon Media Services, Ltd. for 100% of the outstanding shares of Extreme Mobile Coatings, Inc. |
| (2) | To record the recapitalization of Falcon Media Services, Ltd. based on the share exchange agreement and reverse merger with Extreme Mobile Coatings, Inc. |
INTRODUCTION TO INTERIM PRO FORMA
FINANCIAL STATEMENTS
(Unaudited)
Introduction
The following interim pro forma balance sheet, interim pro forma statement of operations, and explanatory notes give effect to the exchange of stock and reverse merger between Extreme Mobile Coatings, Inc. (“Extreme”) and Falcon Media Services, Ltd. (“Falcon”), and are unaudited.
The interim pro forma balance sheet, interim pro forma statement of operations, and explanatory notes are based on the estimates and assumptions set forth in the explanatory notes. The interim pro forma balance sheet and the interim pro forma statement of operations have been prepared utilizing the historical financial statements of Falcon and Extreme and should be read in conjunction with the historical financial statements and notes thereto.
The interim pro forma balance sheet and interim statement of operations have been prepared as if the exchange of stock and reverse merger had been consummated on January 01, 2008, and carried through to June 30, 2008.
This interim pro forma financial data is provided for illustrative purposes only, and does not purport to be indicative of the actual financial position or results of operations had the exchange of stock and reverse merger occurred at the beginning of the fiscal period presented, nor is it necessarily indicative of the results of future operations.
FALCON MEDIA SERVICES, LTD.
(A Development Stage Company)
Interim Pro Forma Balance Sheet
As of June 30, 2008
(Unaudited)
Falcon | Extreme | |||||||||||||
Media | Mobile | |||||||||||||
Services, Ltd. | Coatings, Inc. | Pro Forma | ||||||||||||
4/30/08 | 06/30/08 | Adjustments | Pro Forma | |||||||||||
ASSETS | ||||||||||||||
Current Assets: | ||||||||||||||
| Cash in bank | $ | 1,080 | $ | 29,435 | $ | - | $ | 30,515 | ||||||
| Accounts receivable - Trade | - | 1,000 | - | 1,000 | ||||||||||
| Prepaid expenses | 37,567 | - | - | 37,567 | ||||||||||
| Total current assets | 38,647 | 30,435 | - | 69,082 | ||||||||||
Property and Equipment: | ||||||||||||||
| Office and computer equipment | - | 7,336 | - | 7,336 | ||||||||||
| Trailer | - | 30,000 | - | 30,000 | ||||||||||
| Less - Accumulated depreciation | - | (2,546 | ) | - | (2,546 | ) | ||||||||
| Net property and equipment | - | 34,790 | - | 34,790 | ||||||||||
Other Assets: | ||||||||||||||
| License agreement, net | - | 48,181 | - | 48,181 | ||||||||||
| Servicemark, net | - | 875 | - | 875 | ||||||||||
| Security deposit | - | 3,330 | - | 3,330 | ||||||||||
| Total other assets | - | 52,386 | - | 52,386 | ||||||||||
Total Assets | $ | 38,647 | $ | 117,611 | $ | - | $ | 156,258 | ||||||
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ||||||||||||||
Current Liabilities: | ||||||||||||||
| Current portion of long-term debt | $ | - | $ | 74,364 | $ | - | $ | 74,364 | ||||||
| Accounts payable - Trade | - | 52,969 | - | 52,969 | ||||||||||
| Accrued liabilities | 3,000 | 33,656 | - | 36,656 | ||||||||||
| Due to related parties | 16,169 | 60,268 | - | 76,437 | ||||||||||
| Promissory note - XIOM Corp. - Related party | - | 108,500 | - | 108,500 | ||||||||||
| Due to unrelated party | 7,616 | - | - | 7,616 | ||||||||||
| Total current liabilities | 26,785 | 329,757 | - | 356,542 | ||||||||||
Long-term Debt, less current portion: | ||||||||||||||
| Bank loan | - | 252,696 | - | 252,696 | ||||||||||
| Total long-term debt | - | 252,696 | - | 252,696 | ||||||||||
| Total liabilities | 26,785 | 582,453 | - | 609,238 | ||||||||||
Commitments and Contingencies | ||||||||||||||
Stockholders' Equity (Deficit): | ||||||||||||||
| Common stock | 4,410 | 12,891 | 13,505 | (1) | 17,915 | |||||||||
| (12,891 | ) | (2) | ||||||||||||
| Additional paid-in capital | 137,935 | 64,032 | (131,097 | ) | (2) | 70,870 | ||||||||
| (Deficit) accumulated during the development stage | (128,916 | ) | (541,765 | ) | 128,916 | (2) | (541,765 | ) | ||||||
| Other accumulated comprehensive (loss) | (1,567 | ) | - | 1,567 | (2) | - | ||||||||
Total Stockholders' Equity (Deficit) | 11,862 | (464,842 | ) | - | (443,822 | ) | ||||||||
Total Liabilities and Stockholders' Equity (Deficit) | $ | 38,647 | $ | 117,611 | $ | - | $ | 156,258 | ||||||
FALCON MEDIA SERVICES, LTD.
(A Development Stage Company)
Interim Pro Forma Statement of Operations
For the Six Months Ended June 30, 2008
(Unaudited)
Falcon | Extreme | |||||||||||||
Media | Mobile | |||||||||||||
Services, Ltd. | Coatings, Inc. | Pro Forma | ||||||||||||
04/30/08 | 06/30/08 | Adjustments | Pro Forma | |||||||||||
Revenues | $ | - | $ | 1,000 | $ | - | $ | 1,000 | ||||||
Expenses: | ||||||||||||||
| General and administrative | 27,656 | 99,212 | (27,656 | ) | (2) | 99,212 | ||||||||
| Depreciation and amortization | - | 3,427 | - | 3,427 | ||||||||||
| Total expenses | 27,656 | 102,639 | (27,656 | ) | 102,639 | |||||||||
(Loss) from operations | (27,656 | ) | (101,639 | ) | 27,656 | (101,639 | ) | |||||||
Other Income (Expense) | ||||||||||||||
| Interest expense | - | (18,509 | ) | - | (18,509 | ) | ||||||||
| Loss on asset purchase agreement | - | - | - | - | ||||||||||
| Total other Income (Expense) | - | (18,509 | ) | - | (18,509 | ) | ||||||||
Provision for income taxes | - | - | - | - | ||||||||||
Net (loss) | (27,656 | ) | (120,418 | ) | 27,656 | (120,418 | ) | |||||||
Other comprehensive (loss): | ||||||||||||||
| Foreign currency translation | 411 | - | (411 | ) | (2) | - | ||||||||
Comprehensive (loss) | $ | (27,245 | ) | $ | (120,418 | ) | $ | 27,245 | $ | (120,418 | ) | |||
Net Loss Per Share - Basic and Diluted | $ | (0.01 | ) | $ | (0.01 | ) | $ | (0.01 | ) | |||||
Weighted Average Shares Outstanding | 4,409,600 | 12,891,218 | 13,505,085 | (1) | 17,914,685 | |||||||||
Notes:
| (1) | To record the issuance of 13,505,085 shares of common stock by Falcon Media Services, Ltd. for 100% of the outstanding shares of Extreme Mobile Coatings, Inc. |
| (2) | To record the recapitalization of Falcon Media Services, Ltd. based on the share exchange agreement and reverse merger with Extreme Mobile Coatings, Inc. |