Exhibit 99.2
SILVERHILL MANAGEMENT SERVICES, INC.
AND
FUEL DOCTOR, LLC
INDEX TO THE UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
(UNAUDITED)
Contents
Page(s)
Pro Forma Combined Financial Statements 2 Pro Forma Combined Balance Sheet at March 31, 2011 3 Pro Forma Combined Statement of Operations for the Three Months Ended March 31, 2011 4 Pro Forma Combined Statement of Operations for the Year Ended December 31, 2010 5 Notes to the Pro Forma Combined Financial Statements 6 |
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SILVERHILL MANAGEMENT SERVICES, INC.
AND
FUEL DOCTOR, LLC
AS OF AND FOR THE THREE MONTHS ENDED MARCH 31, 2011
AND
AS OF AND FOR THE YEAR ENDED DECEMBER 31, 2010
(UNAUDITED)
The following pro forma combined balance sheet as of March 31, 2011 and the pro forma combined statements of operations for the three months ended March 31, 2011 and for the year ended December 31, 2010 are based on the historical financial statements of Silverhill Management Services, Inc. (the “Company”) and Fuel Doctor LLC, (the “FDLLC”) after giving effect to the FDLLC’s acquisition of the Company using the purchase method of accounting and applying the assumptions and adjustments described in the accompanying notes to the pro forma combined financial statements as if such acquisition had occurred as of March 31, 2011 for the balance sheet, and January 1, 2010 for statements of operations for pro forma financial statements purposes.
The merger between the Company and FDLLC has been accounted for as a reverse acquisition under the purchase method of accounting in accordance with ASC Topic 805 “Business Combinations”. The combination of the two companies is recorded as a recapitalization of the Company pursuant to which the Company is treated as the continuing entity. In connection with the acquisition, the Company exchanged 100% of membership interest of the Fuel Doctor LLC by issuing 9,347,500 shares of the Company’s common stock. As a result of the consummation of the Share Issuance, FDLLC became a wholly owned subsidiary of the Company; and the managers of FDLLC were appointed as the Officers and Directors of the Company.
The pro forma combined financial statements have been prepared by management for illustrative purposes only and are not necessarily indicative of the combined consolidated financial position or results of operations in future periods or the results that actually would have been realized had the Company and FDLLC been a combined company during the specified periods. The pro forma adjustments are based on the preliminary information available at the time of the preparation of this document and assumptions that management believes are reasonable. The pro forma combined financial statements, including the notes thereto, are qualified in their entirety by reference to, and should be read in conjunction with, the Company’s historical financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2010 as filed with United States Securities and Exchange Commission (“SEC”) on March 31, 2011 and its Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2011 as filed with SEC on May 12, 2011.
2
SILVERHILL MANAGEMENT SERVICES, INC. AND SUBSIDIARY | |||||||||||
PRO FORMA COMBINED BALANCE SHEET | |||||||||||
March 31, 2011 | |||||||||||
(Unaudited) | |||||||||||
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| Historical |
| Pro Forma | ||||
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| Silverhill Management Services, Inc. |
| Fuel Doctor, LLC |
| Adjustments |
| Combined |
ASSETS |
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CURRENT ASSETS: |
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| Cash | $ | 206 | $ | 75,731 | $ | - | $ | 75,937 | ||
| Accounts receivable |
| - |
| 122,671 |
| - |
| 122,671 | ||
| Inventories |
| - |
| 1,247,671 |
| - |
| 1,247,671 | ||
| Prepaid income taxes |
| - |
| 1,726 |
| - |
| 1,726 | ||
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| Total Current Assets |
| 206 |
| 1,447,799 |
| - |
| 1,448,005 | |
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OFFICE EQUIPMENT |
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| - |
| - | |||
| Office equipment |
| - |
| 6,370 |
| - |
| 6,370 | ||
| Accumulated depreciation |
| - |
| (1,393) |
| - |
| (1,393) | ||
OFFICE EQUIPMENT, net |
| - |
| 4,977 |
| - |
| 4,977 | |||
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SECURITY DEPOSIT |
| - |
| 3,210 |
| - |
| 3,210 | |||
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| Total Assets | $ | 206 | $ | 1,455,986 | $ | - | $ | 1,456,192 |
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) |
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CURRENT LIABILITIES: |
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| Accounts payable | $ | - | $ | 164,267 | $ | - | $ | 164,267 | ||
| Credit card payable |
| - |
| 122,365 |
| - |
| 122,365 | ||
| Advances from related party |
| - |
| 1,866 |
| - |
| 1,866 | ||
| Accrued expenses and other current liabilities |
| 20,027 |
| 30,366 |
| - |
| 50,393 | ||
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| Total Current Liabilities |
| 20,027 |
| 318,864 |
| - |
| 338,891 | |
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LONG-TERM DEBT |
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| 101,732 |
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| 101,732 | |||
LONG-TERM DEBT-RELATED PARTIES |
| - |
| 506,814 |
| - |
| 506,814 | |||
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| Total Liabilities |
| 20,027 |
| 927,410 |
| - |
| 947,437 |
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COMMITMENTS AND CONTINGENCIES |
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STOCKHOLDERS' EQUITY (DEFICIT): |
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| Preferred stock, $0.0001 par value; 10,000,000 shares authorized; none issued or outstanding |
| - |
| - |
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| - | ||
| Common stock: $0.0001 par value; 74,000,000 shares authorized; 50,000,000 shares issued and outstanding 12,473,600 shares issued and outstanding - Pro Forma |
| 421 |
| - | (1)(2)(3) | 826 |
| 1,247 | ||
| Additional paid-in capital |
| 92,710 |
| - | (1)(2)(3)(4)(5) | 414,798 |
| 507,508 | ||
| Members' capital |
| - |
| 3,918,468 | (5) | (3,918,468) |
| - | ||
| Accumulated deficit |
| (112,952) |
| (3,389,892) | (4)(5) | 3,502,844 |
| - | ||
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| Total Stockholders' Equity (Deficit) |
| (19,821) |
| 528,576 |
| - |
| 508,755 | |
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| Total Liabilities and Stockholders' Equity (Deficit) | $ | 206 | $ | 1,455,986 | $ | - | $ | 1,456,192 |
(1)
To reflect cancellation of 3,485,000 shares of SLHL’s common stock by the controlling stockholder effective as of August 24, 2011, the closing date of the merger between SLHL and Fuel Doctor, LLC.
(2)
To give effect to 4.3 for 1 forward stock split upon acquisition of Fuel Doctor, LLC.
(3)
To reflect issuance of additional 9,347,500 shares to Fuel Doctor, LLC members effective as of August 24, 2011 upon acquisition of Fuel Doctor, LLC.
(4)
To reclassify SLHL accumulated deficit to Additional paid-in capital.
(5)
To reclassify Fuel Doctor, LLC members' capital and accumulated deficit to additional paid-in capital.
See accompanying notes to the unaudited pro forma combined financial statements.
3
SILVERHILL MANAGEMENT SERVICES, INC. AND SUBSIDIARY | |||||||||||
PRO FORMA COMBINED STATEMENTS OF OPERATIONS | |||||||||||
For the Three Months Ended March 31, 2011 | |||||||||||
(Unaudited) | |||||||||||
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| Historical |
| Pro Forma | ||||
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| Silverhill Management Services, Inc. |
| Fuel Doctor, LLC |
| Adjustments |
| Combined |
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| For the Three Months |
| For the Three Months |
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| Ended |
| Ended |
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| March 31, 2011 |
| March 31, 2011 |
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NET REVENUES | $ | - | $ | 344,007 | $ | - | $ | 344,007 | |||
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COST OF SALES |
| - |
| 210,614 |
| - |
| 210,614 | |||
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GROSS PROFIT |
| - |
| 133,393 |
| - |
| 133,393 | |||
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OPERATING EXPENSES: |
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| Adverting & promotion |
| - |
| 349,681 |
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| 349,681 | ||
| Commission |
| - |
| 1,130 |
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| 1,130 | ||
| Product samples |
| - |
| 8,129 |
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| 8,129 | ||
| Professional fee |
| 8,364 |
| 48,311 |
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| 56,675 | ||
| Rent expenses |
| - |
| 9,951 |
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| 9,951 | ||
| Officer compensation |
| - |
| 74,100 |
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| 74,100 | ||
| General and administrative |
| 36 |
| 68,547 |
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| 68,583 | ||
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| Total Operating Expenses |
| 8,400 |
| 559,849 |
| - |
| 568,249 | |
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LOSS FROM OPERATIONS |
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| (8,400) |
| (426,456) |
| - |
| (434,856) | ||
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OTHER (INCOME) EXPENSE: |
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| Interest expense |
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| - |
| 3,043 |
| - |
| 3,043 | |
| Other (income) expense |
| - |
| (6) |
| - |
| (6) | ||
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| Other (income) expense, net |
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| - |
| 3,037 |
| - |
| 3,037 |
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LOSS BEFORE INCOME TAXES |
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| AND NONCONTROLLING INTEREST |
| (8,400) |
| (429,493) |
| - |
| (437,893) | ||
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INCOME TAX PROVISION |
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| - |
| - |
| - |
| - | ||
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LOSS BEFORE NONCONTROLLING INTEREST |
| (8,400) |
| (429,493) |
| - |
| (437,893) | |||
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NONCONTROLLING INTEREST |
| - |
| - |
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| - | |||
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NET LOSS |
| $ | (8,400) | $ | (429,493) | $ | - | $ | (437,893) | ||
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NET LOSS PER COMMON SHARE - BASIC AND DILUTED: | $ | - |
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| $ | - | $ | (0.04) | |||
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Weighted average number of common shares outstanding - basic and diluted(1) |
| 4,212,000 |
|
| (1)(2)(3) | 8,261,600 |
| 12,473,600 | |||
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LOSS PER COMMON SHARE - DILUTED: | $ | - |
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| $ | - | $ | (0.04) | |||
| Continuing operations | $ | - |
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| $ | - | $ | (0.04) | ||
| Net income (loss) | $ | - |
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| $ | (0.04) | ||
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Weighted average number of common shares outstanding - diluted (1) |
| 4,212,000 |
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| 8,261,600 |
| 12,473,600 |
(1)
To reflect cancellation of 3,485,000 shares of SLHL’s common stock by the controlling stockholder effective as of August 24, 2011, the closing date of the merger between SLHL and Fuel Doctor, LLC.
(2)
To give effect to 4.3 for 1 forward stock split upon acquisition of Fuel Doctor, LLC.
(3)
To reflect issuance of additional 9,347,500 shares to Fuel Doctor, LLC members effective as of August 24, 2011 upon acquisition of Fuel Doctor, LLC.
See accompanying notes to the unaudited pro forma combined financial statements.
4
SILVERHILL MANAGEMENT SERVICES, INC. AND SUBSIDIARY | |||||||||||
PRO FORMA COMBINED STATEMENT OF OPERATIONS | |||||||||||
For the Year Ended December 31, 2010 | |||||||||||
(Unaudited) | |||||||||||
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| Historical |
| Pro Forma | ||||
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| Silverhill Management Services, Inc. |
| Fuel Doctor, LLC |
| Adjustments |
| Combined |
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| For the Year |
| For the Year |
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| Ended |
| Ended |
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| December 31, 2010 |
| December 31, 2010 |
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NET REVENUES | $ | - | $ | 780,146 | $ | - | $ | 780,146 | |||
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COST OF SALES |
| - |
| 753,996 |
| - |
| 753,996 | |||
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GROSS PROFIT |
| - |
| 26,150 |
| - |
| 26,150 | |||
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OPERATING EXPENSES: |
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| Adverting & promotion |
| - |
| 967,870 |
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| 967,870 | ||
| Commission |
| - |
| 172,559 |
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| 172,559 | ||
| product sample |
| - |
| 107,422 |
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| 107,422 | ||
| Professional fee |
| 26,307 |
| 165,556 |
| - |
| 191,863 | ||
| Rent expenses |
| - |
| 37,228 |
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| 37,228 | ||
| Officer compensation |
| 1,000 |
| 548,013 |
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| 549,013 | ||
| Research and development |
| - |
| 123,196 |
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| 123,196 | ||
| General and administrative |
| 38 |
| 381,113 |
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| 381,151 | ||
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| Total Operating Expenses |
| 27,345 |
| 2,502,957 |
| - |
| 2,530,302 | |
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LOSS FROM OPERATIONS |
|
| (27,345) |
| (2,476,807) |
| - |
| (2,504,152) | ||
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OTHER (INCOME) EXPENSE: |
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| Interest expense |
|
| - |
| 8,752 |
| - |
| 8,752 | |
| Other (income) expense |
| - |
| (423) |
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| (423) | ||
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| Other (income) expense, net |
|
| - |
| 8,329 |
| - |
| 8,329 |
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LOSS BEFORE INCOME TAXES AND NONCONTROLLING INTEREST |
| (27,345) |
| (2,485,136) |
| - |
| (2,512,481) | |||
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INCOME TAX PROVISION |
|
| - |
| - |
| - |
| - | ||
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LOSS BEFORE NONCONTROLLING INTEREST |
| (27,345) |
| (2,485,136) |
| - |
| (2,512,481) | |||
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NONCONTROLLING INTEREST |
| - |
| - |
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| - | |||
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NET LOSS |
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| (27,345) |
| (2,485,136) |
| - |
| (2,512,481) | ||
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NET LOSS PER COMMON SHARE - BASIC AND DILUTED: | $ | (0.01) |
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| $ | - | $ | (0.20) | |||
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Weighted average number of common shares outstanding – basic and diluted(1) |
| 4,212,000 |
|
| (1)(2)(3) | 8,261,600 |
| 12,473,600 |
(1)
To reflect cancellation of 3,485,000 shares of SLHL’s common stock by the controlling stockholder effective as of August 24, 2011, the closing date of the merger between SLHL and Fuel Doctor, LLC.
(2)
To give effect to 4.3 for 1 forward stock split upon acquisition of Fuel Doctor, LLC.
(3)
To reflect issuance of additional 9,347,500 shares to Fuel Doctor, LLC members effective as of August 24, 2011 upon acquisition of Fuel Doctor, LLC.
See accompanying notes to the unaudited pro forma combined financial statements.
5
SILVERHILL MANAGEMENT SERVICES, INC.
AND
FUEL DOCTOR, LLC
as of and for the three months ended MARCH 31, 2011
and
as of and for the year ended DECEMBER 31, 2010
(UNAUDITED)
NOTE 1
- Basis of Pro Forma Presentation
On August 24, 2011, the Company entered into an Agreement and Plan of Reorganization (the “Plan”) by and among the Company, Fuel Doctor, LLC, a California limited liability company (“FDLLC”), Emily Lussier, the Company’s controlling shareholder, and the members of FDLLC. A closing under the Plan was held on the same date. Pursuant to the Plan, Emily Lussier surrendered 3,485,000 shares, representing her controlling interest in the Company to the Registrant and resigned as an officer and director; the Company effectuated a 4.3 for 1 (1:4.3) forward stock split; and the Company acquired 100% of the membership interests from the members of FDLLC for 9,437,500 shares of the Company’s common stock representing approximately 74.9% of the Company outstanding stock immediately post acquisition; FDLLC became a wholly owned subsidiary of the Company; and the managers of FDLLC were appointed as the Officers and Directors of the Company upon closing of the Plan.
The pro forma combined balance sheet as of March 31, 2011 and the pro forma combined statements of operations for the three months ended March 31, 2011 and for the year ended December 31, 2010 are based on the historical financial statements of FDLLC and the Company after giving effect to FDLLC’s acquisition of the Company using the purchase method of accounting and applying the assumptions and adjustments described in the accompanying notes to the pro forma combined financial statements as if such acquisition had occurred as of March 31, 2011 for the balance sheet, and January 1, 2010 for statements of operations for pro forma financial statements purposes. The pro forma combined financial statements do not purport to represent what the results of operations or financial position of the Company would actually have been if the merger had in fact occurred on January 1, 2010, nor do they purport to project the results of operations or financial position of the Company for any future period or as of any date, respectively.
These pro forma combined financial statements do not give effect to any restructuring costs or to any potential cost savings or other operating efficiencies that could result from the merger between FDLLC and the Company since such amounts, if any, are not presently determinable.
NOTE 2
- Pro Forma Adjustments
The accompanying pro forma combined financial statements have been prepared as if the acquisition was completed on March 31, 2011 for balance sheet purposes and on January 1, 2010 for statements of operations purposes and reflect the following pro forma adjustments:
1) | To reflect cancellation of 3,485,000 shares of SLHL’s common stock by the controlling stockholder effective as of August 24, 2011, the closing date of the merger between SLHL and Fuel Doctor, LLC. |
Additional paid-in capital |
|
| (348 | ) |
|
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|
|
Common stock: $0.0001 par value |
|
| 348 |
|
2) | To give effect to 4.3 for 1 forward stock split upon acquisition of Fuel Doctor, LLC. |
Additional paid-in capital |
|
| 240 |
|
|
|
|
|
|
Common stock: $0.0001 par value |
|
| (240 | ) |
3) | To reflect issuance of additional 9,347,500 shares to Fuel Doctor, LLC members effective as of August 24, 2011 upon acquisition of Fuel Doctor, LLC. |
Common stock: $0.001 par value |
|
| (9,348 | ) |
|
|
|
|
|
Additional paid-in capital |
|
| 9,348 |
|
4) | To reclassify SLHL accumulated deficit to Additional paid-in capital |
Additional paid-in capital |
|
| (112,952 | ) |
|
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|
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|
Accumulated deficit |
|
| 112,952 |
|
5) | To reclassify FDLLC’s member capital and accumulated deficit as additional paid-in capital. | ||||
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| |
Additional paid-in capital |
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| (3,918,468 | ) |
6
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Member’s capital |
|
| 3,918,468 |
|
|
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|
|
|
Additional paid-in capital |
|
| 3,389,892 |
|
|
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|
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|
Accumulated deficit |
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| (3,389,892 | ) |
7