Exhibit 99.3
Eastside Distilling, Inc.
Unaudited Pro Forma Condensed Consolidated Balance Sheets
September 30, 2014
| | | Historical | | | | | | | |
| | | Eastside
Distilling | | | Eurocan
Holdings | | | Pro Forma
Adjustments | | | Pro Forma
Consolidated | |
| Assets | | | | | | | | | | | | | | | | |
| Current assets | | | | | | | | | | | | | | | | |
| Cash | | $ | 16,307 | | | $ | 229 | | | $ | - | | | $ | 16,536 | |
| Accounts receivable | | | 49,014 | | | | 5,240 | | | | - | | | | 54,254 | |
| Interest receivable | | | - | | | | 2,241 | | | | (2,241 | )(2) | | | - | |
| Inventories | | | 223,655 | | | | - | | | | - | | | | 223,655 | |
| Note receivable | | | - | | | | 150,000 | | | | (150,000 | )(2) | | | - | |
| Total current assets | | | 288,976 | | | | 157,710 | | | | (152,241 | ) | | | 294,445 | |
| Property and equipment - net | | | 24,550 | | | | - | | | | - | | | | 24,550 | |
| Deposit | | | 48,000 | | | | - | | | | - | | | | 48,000 | |
| Goodwill | | | - | | | | - | | | | 3,239,126 | (1) | | | 3,239,126 | |
| Total Assets | | $ | 361,526 | | | $ | 157,710 | | | $ | 3,086,885 | | | $ | 3,606,121 | |
| | | | | | | | | | | | | | | | | |
| Liabilities and Equity (Deficit) | | | | | | | | | | | | | | | | |
| Current liabilities | | | | | | | | | | | | | | | | |
| Accounts payable | | $ | 261,969 | | | $ | 38,100 | | | $ | - | | | $ | 300,069 | |
| Accrued liabilities | | | 49,540 | | | | 11,302 | | | | (2,241 | )(2) | | | 58,601 | |
| Deferred revenue | | | - | | | | 2,860 | | | | - | | | | 2,860 | |
| Due to related party | | | 18,632 | | | | 8,358 | | | | - | | | | 26,990 | |
| Current portion of notes payable | | | 149,980 | | | | 76,945 | | | | (150,000 | )(2) | | | 76,925 | |
| Convertible note payable, net of unamortized discount of $90,729 | | | - | | | | 59,271 | | | | - | | | | 59,271 | |
| Total current liabilities | | | 480,121 | | | | 196,836 | | | | (152,241 | ) | | | 524,716 | |
| | | | | | | | | | | | | | | | | |
| Equity (deficit) | | | | | | | | | | | | | | | | |
| Common stock | | | - | | | | 3,291 | | | | (3,291 | )(1) | | | 4,000 | |
| | | | | | | | | | | | 4,000 | (1) | | | - | |
| Additional paid-in capital | | | - | | | | 340,441 | | | | (340,441 | )(1) | | | 3,196,000 | |
| | | | | | | | | | | | 3,196,000 | (1) | | | - | |
| Accumulated deficit | | | (118,595 | ) | | | (382,858 | ) | | | 382,858 | (1) | | | (118,595 | ) |
| Total equity (deficit) | | | (118,595 | ) | | | (39,126 | ) | | | 3,239,126 | | | | 3,081,405 | |
| Total Liabilities and Equity (Deficit) | | $ | 361,526 | | | $ | 157,710 | | | $ | 3,086,885 | | | $ | 3,606,121 | |
See the accompanying notes to the unaudited pro forma condensed consolidated financial statements.
Eastside Distilling, Inc.
Unaudited Pro Forma Condensed Consolidated Statements of Operations
For the Nine Months Ended September 30, 2014
| | | Historical | | | | | | | |
| | | Eastside
Distilling | | | Eurocan
Holdings | | | Pro Forma
Adjustments | | | Pro Forma
Consolidated | |
| | | | | | | | | | | | | |
| Sales | | $ | 738,639 | | | $ | 28,028 | | | $ | - | | | $ | 766,667 | |
| Less excise taxes | | | 127,936 | | | | - | | | | - | | | | 127,936 | |
| Net sales | | | 610,703 | | | | 28,028 | | | | - | | | | 638,731 | |
| Cost of sales | | | 290,036 | | | | 393 | | | | - | | | | 290,429 | |
| Gross profit | | | 320,667 | | | | 27,635 | | | | - | | | | 348,302 | |
| Selling, general and administrative expenses | | | 584,447 | | | | 73,381 | | | | - | | | | 657,828 | |
| Loss from operations | | | (263,780 | ) | | | (45,746 | ) | | | - | | | | (309,526 | ) |
| Other income (expense) | | | | | | | | | | | | | | | | |
| Interest income | | | - | | | | 2,241 | | | | (2,241 | )(2) | | | - | |
| Interest expense | | | (3,308 | ) | | | (12,056 | ) | | | 2,241 | (2) | | | (13,123 | ) |
| Total other expense - net | | | (3,308 | ) | | | (9,815 | ) | | | - | | | | (13,123 | ) |
| Net loss | | $ | (267,088 | ) | | $ | (55,561 | ) | | $ | - | | | $ | (322,649 | ) |
| | | | | | | | | | | | | | | | | |
| Net loss per share - basic and diluted | | | | | | $ | (0.00 | ) | | | | | | $ | (0.01 | ) |
| Number of common shares used in per share amounts | | | | | | | 32,910,000 | | | | | | | | 40,000,000 | |
See the accompanying notes to the unaudited pro forma condensed consolidated financial statements.
Eastside Distilling, Inc.
Unaudited Pro Forma Condensed Consolidated Statements of Operations
For the Year Ended December 31, 2013
| | | Historical | | | | | | | |
| | | Eastside
Distilling | | | Eurocan
Holdings | | | Pro Forma
Adjustments | | | Pro Forma
Consolidated | |
| | | | | | | | | | | | | |
| Sales | | $ | 880,454 | | | $ | 64,036 | | | $ | - | | | $ | 944,490 | |
| Less excise taxes | | | 138,897 | | | | - | | | | - | | | | 138,897 | |
| Net sales | | | 741,557 | | | | 64,036 | | | | - | | | | 805,593 | |
| Cost of sales | | | 303,220 | | | | 8,216 | | | | - | | | | 311,436 | |
| Gross profit | | | 438,337 | | | | 55,820 | | | | - | | | | 494,157 | |
| Selling, general and administrative expenses | | | 347,582 | | | | 137,587 | | | | - | | | | 485,169 | |
| Income (loss) from operations | | | 90,755 | | | | (81,767 | ) | | | - | | | | 8,988 | |
| Other income (expense) | | | | | | | | | | | | | | | | |
| Other income | | | - | | | | 10,742 | | | | - | | | | 10,742 | |
| Interest expense | | | (1,552 | ) | | | (15,210 | ) | | | - | | | | (16,762 | ) |
| Loss on disposal of property and equipment | | | (2,217 | ) | | | - | | | | - | | | | (2,217 | ) |
| Total other expense - net | | | (3,769 | ) | | | (4,468 | ) | | | - | | | | (8,237 | ) |
| Net income (loss) | | $ | 86,986 | | | $ | (86,235 | ) | | $ | - | | | $ | 751 | |
| | | | | | | | | | | | | | | | | |
| Net income (loss) per share - basic and diluted | | | | | | $ | (0.01 | ) | | | | | | $ | 0.00 | |
| Number of common shares used in per share amounts | | | | | | | 15,034,384 | | | | | | | | 40,000,000 | |
See the accompanying notes to the unaudited pro forma condensed consolidated financial statements.
Eastside Distilling, Inc.
Notes to Unaudited Pro Forma Condensed Consolidated
Financial Statements
On October 31, 2014, Eurocan Holdings Ltd. (“Eurocan”) consummated the acquisition (the “Acquisition”) of Eastside Distilling, LLC (“Eastside”) pursuant to an Agreement and Plan of Merger (the “Agreement”) by and among Eurocan, Eastside, and Eastside Distilling, Inc., Eurocan's wholly-owned subsidiary. Pursuant to the Agreement, Eastside merged with and into Eastside Distilling, Inc. The merger consideration for the acquisition consisted of 32,000,000 shares (the “Shares”) of Eurocan's common stock. In addition, certain of Eurocan's stockholders cancelled an aggregate of 24,910,000 shares of Eurocan's common stock held by them. As a result, on October 31, 2014, Eurocan had 40,000,000 shares of common stock issued and outstanding, of which 32,000,000 shares were held by the former members of Eastside. Consequently, for accounting purposes, the transaction will be accounted for as a reverse acquisition, with Eastside as the acquirer. Subsequent to the consummation of the transaction, the historical financial statements of Eastside will become the historical financial statements of the combined company and the assets and liabilities of Eurocan will be accounted for as required under the purchase method of accounting. The results of operations of Eurocan will be included in Eastside's consolidated financial statements from the closing date of acquisition.
The accompanying pro forma condensed consolidated financial statements are unaudited and illustrate the effect of the Eastside reverse acquisition of Eurocan. The pro forma condensed consolidated balance sheets as of September 30, 2014 are based on the historical balance sheets of Eastside and Eurocan as of that date and assume the acquisition took place on that date. The pro forma condensed consolidated statements of operations for the nine months ended September 30, 2014 and the year ended December 31, 2013 are based on the historical statements of operations of Eastside and Eurocan for those periods. The pro forma condensed consolidated statements of operations assume the acquisition took place on the first day of the respective periods, January 1, 2014 and January 1, 2013.
The pro forma condensed consolidated financial statements may not be indicative of the acquisition. In particular, the pro forma condensed consolidated financial statements are based on management's current estimate of the allocation of the purchase price, the actual allocation of which may differ.
The accompanying pro forma condensed consolidated financial statements should be read in connection with the historical financial statements of Eastside and Eurocan, including the related notes and other financial information included in the filing.
The pro forma adjustments to the unaudited pro forma condensed consolidated balance sheets are as follows:
| (1) | To reflect the reverse acquisition of Eurocan equal to the value of the stock retained by the stockholders of Eurocan in the merger. Eurocan stockholders will retain 8,000,000 shares of common stock valued at $0.40 per share based on Eurocan's stock price on the merger date of October 31, 2014. |
| (2) | Adjustment to eliminate an intercompany note and related accrued interest between Eastside and Eurocan. |
| 3. | Pro Forma Net Income (Loss) Per Common Share |
The unaudited pro forma basic and diluted net income (loss) per share are based on the assumption that the number of shares of Eurocan common stock issued in connection with the reverse acquisition of Eurocan were outstanding at the inception of the respective operating statements.
