PRIVATE SECRETARY, INC.
NOTES TO CONSOLIDATING FINANCIAL STATEMENTS
1. REVERSE MERGER
On February 9, 2012, Private Secretary, Inc. (the “Company”) completed a reverse merger transaction through a merger with GrowOp Technology whereby the Company acquired all of the issued and outstanding shares of GrowOp Technology in exchange for 33,998,520 shares of our common stock, which represented approximately 41.4% of our total shares outstanding immediately following the closing of the transaction. As a result of the reverse acquisition, GrowOp Technology became our wholly owned subsidiary and the former shareholders of GrowOp Technology became our controlling stockholders. The share exchange transaction with GrowOp Technology was treated as a reverse acquisition, with GrowOp Technology as the acquiror and the Company as the acquired party.
On February 26, 2012, pursuant the Agreement and Plan of Merger, the Company issued an aggregate of 100 shares of Series A Preferred Stock and 24,999,900 shares of Series B Preferred Stock to Derek Peterson and Amy Almsteier, both of whom are officers and directors of the Company. The Company offered and sold the shares in reliance on the exemption from registration pursuant to Section 4(2) of Securities Act and Rule 506 of Regulation D promulgated thereunder.
2. ASSUMPTIONS IN CONSOLIDATION
The Pro Forma Consolidating Balance Sheet as of September 30, 2011 is adjusted as if the transaction took place as of January 1, 2011. The debt that is due to officers is converted into Preferred Stock. There is an adjustment for the common stock that would be issued to the existing shareholders of GrowOp Technology as if the transaction took place as of January 1, 2011.
No adjustments were required for the Pro Forma Consolidating Statements of Operations for the nine months ended September 30, 2011.