GBT (GTCH) 8-K/A Entry into a Material Definitive Agreement

Exhibit 99.2

Gopher Protocol, Inc.,

and ECS Prepaid, LLC and Electronic Check Services, Inc.

Pro Forma Consolidated Financial Statements

(unaudited)

Contents

	Page
Pro Forma Consolidated Financial Statements:
Pro Forma Consolidated Balance Sheet as of December 31, 2017 (unaudited)	2
Pro Forma Consolidated Statements of Operations for the year ended December 31, 2017 (unaudited)	3
Notes to Pro Forma Consolidated Financial Statements (unaudited)	4

1

Gopher Protocol, Inc.,

and ECS Prepaid, LLC and Electronic Check Services, Inc.

Pro Forma Consolidated Balance Sheet

December 31, 2017

(unaudited)

ASSETS	Gopher			ECS Prepaid and		Pro forma			Pro forma
	Protocol			Electronic Check		Adjustments			Consolidated
		(historical)			(historical)
Current Assets:
Cash	$	1,305,062		$	42,613	$	(175,000	)a	$	1,172,675
Accounts receivable		41,947			774,888					816,835
Inventory		262,749								262,749
Prepaid expenses		—			106					106
Total current assets		1,609,758			817,607		(175,000	)		2,252,365
Property and equipment, net		263,082			36,250		65,000	a		364,332
Intangible assets, net		6,666,667					1,050,000	a		7,716,667
Other assets		1,979								1,979
Goodwill		950,619					3,440,877	a		4,391,496
										—
Total assets	$	9,492,105		$	853,857	$	4,380,877		$	14,726,839
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable and accrued expenses	$	1,199,215		$	715,569	$			$	1,914,784
Due to Guardian LLC		1,350,262								1,350,262
Convertible notes payable, net of discount of $54,377		25,623								25,623
Derivative liability		95,164								95,164
Note payable							1,000,000	a		1,000,000
Total current liabilities		2,670,264			715,569		1,000,000			4,385,833
Convertible note payable, net of debt discount		—
Note payable		2,600,000			—		—			2,600,000
Total liabilities		5,270,264			715,569		1,000,000			6,985,833
Stockholders’ Equity
Series B Preferred stock		—								—
Series C Preferred stock		—								—
Series D Preferred stock		1								1
Series G Preferred stock		20								20
Common stock		2,582			38,576		(38,568	)a		2,590
Treasury stock		(643,059	)							(643,059	)
Additional paid in captial		19,243,959					3,519,157	a		22,763,116
Retained earnings (accumulated deficit)		(14,381,662	)		99,712		(99,712	)a		(14,381,662	)
Total stockholders’ equity		4,221,841			138,288		3,380,877			7,741,006
Total liabilities and stockholders’ equity	$	9,492,105		$	853,857	$	4,380,877		$	14,726,839

See accompanying footnotes to pro forma consolidated financial statements.

2

Gopher Protocol, Inc.,

and ECS Prepaid, LLC and Electronic Check Services, Inc.

Pro Forma Consolidated Statement of Operations

For the Year Ended December 31, 2017

	Gopher			ECS Prepaid and		Pro forma			Pro forma
	Protocol			Electronic Check		Adjustments			Consolidated
	(historical)			(historical)
Sales:
Sales	$	9,012,354		$	27,897,265	$			$	36,909,619
Related party sales		180,000								180,000
Total sales		9,192,354			27,897,265		—			37,089,619
Cost of goods sold		8,651,804			27,042,816		—			35,694,620
Gross profit		540,550			854,449		—			1,394,999
Operating expenses:
General and administrative expenses		3,574,296			815,991		150,000	b		4,540,287
Marketing expenses		220,229								220,229
Acquisition costs		4,050,819								4,050,819
Total operating expenses		7,845,344			815,991		150,000			8,811,335
Loss from operations		(7,304,794	)		38,458		(150,000	)		(7,416,336	)
Other income (expense):
Amortization of debt discount		(1,195,755	)							(1,195,755	)
Change in fair value of derivative liability		374,230								374,230
Interest expense and financing costs		(2,160,971	)							(2,160,971	)
Total other income (expense)		(2,982,496	)		—		—			(2,982,496	)
Loss before income taxes		(10,287,290	)		38,458		(150,000	)		(10,398,832	)
Income tax expense		—								—
Net loss	$	(10,287,290	)	$	38,458	$	(150,000	)	$	(10,398,832	)
Weighted average common shares outstanding:
Basic and diluted		46,256,807								47,006,807
Net loss per share:
Basic and diluted	$	(0.22	)	$					$	(0.22	)

See accompanying footnotes to pro forma consolidated financial statements.

3

Gopher Protocol, Inc.,

and ECS Prepaid, LLC and Electronic Check Services, Inc.

Notes to Pro Forma Consolidated Financial Statements

NOTE 1 - BASIS OF PRESENTATION

On March 16, 2018, Gopher Protocol, Inc. (the “Company”) entered into and closed an asset purchase agreement dated March 1, 2018 with ECS Prepaid LLC (“ECS”), a Missouri limited liability company, pursuant to which the Company purchased certain assets from ECS, including, but not limited to, the processing prepaid platform, servers, POS terminals, customer list, a processing software program and goodwill, in consideration of $1,100,000 of which $100,000 was paid on the closing date and the balance is to be paid pursuant to a secured promissory note in the amount of $1,000,000. In addition, the Company issued 500,000 shares of common stock of the Company and warrants to purchase 500,000 shares of common stock that are exercisable for a period of five years at a fixed exercise price of $1.85 per share.

On April 2, 2018, the Company entered into and closed an asset purchase agreement with Electronic Check Services Inc. (“Electronic Check”), a Missouri corporation, pursuant to which the Company purchased certain assets from Electronic Check, including, but not limited to, assets associated with software that validates written check authenticity, in consideration of $75,000 paid on the closing date. In addition, the Company issued 250,000 shares of common stock of the Company and warrants to purchase 250,000 shares of common stock. The warrants are exercisable for a period of five years at a fixed exercise price of $2.70 per share.

ECS and Electronic Check are owned by the same individual.

The accompanying pro forma consolidated balance sheet presents the accounts of Gopher, and ECS and Electronic Check as if the transactions occurred December 31, 2017. The accompanying pro forma consolidated statement of operations presents the accounts of Gopher, and ECS and Electronic Check for the year ended December 31, 2017 as if the transactions occurred on January 1, 2017.

The following adjustments would be required if the acquisition occurred as indicated above:

a) To record the purchase price allocation and to eliminate the common stock and retained earnings of ECS and Electronic Check.

b) To record amortization expense for the software purchased in the transactions.

The unaudited consolidated pro forma financial information is presented for informational purposes only and is subject to a number of uncertainties and assumptions and do not purport to represent what the company’s actual performance or financial position would have been had the transaction occurred on the dates indicated and does not purport to indicate the financial position or results of operations as of any future date or for any future period.

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