Alta Equipment (ALTG) 8-K12B Notification of registration of securities

Exhibit 99.2

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION

On February 14, 2020 (the “Closing Date”), Alta Equipment Group Inc. (formerly known as B. Riley Principal Merger Corp.), a Delaware corporation (the “Company”), consummated its acquisition of Alta Equipment Holdings, Inc., a Michigan corporation (“Alta”), pursuant to the Agreement and Plan of Merger, dated as of December 12, 2019 (the “Merger Agreement”), by and among the Company, BR Canyon Merger Sub Corp., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”), Alta and Ryan Greenawalt. The transactions contemplated by the Merger Agreement are referred to herein as the “Business Combination.”  

In connection with the closing of the Business Combination (the “Closing”), the Company changed its name from “B. Riley Principal Merger Corp.” to “Alta Equipment Group Inc.”

On February 11, 2020, the Business Combination was approved by the stockholders of the Company at the special meeting in lieu of the 2020 annual meeting of stockholders of the Company (the “Special Meeting”). The Business Combination was completed on February 14, 2020. In connection with the Business Combination, 1,049,036 shares of the Company’s common stock were redeemed at a per share price of approximately $10.14. Upon the Closing, the Company had 29,511,359 shares of common stock outstanding, 16,884,213 of which were held by non-affiliates of the Company.

For purposes of the unaudited pro forma condensed combined financial information, the aggregate consideration for the Business Combination was $404,000,000, consisting of (i) the Company’s pay off of Alta’s existing gross debt in the amount of $285 million, (ii) approximately $43 million in cash and (iii) an aggregate of 7,600,000 shares of common stock valued at $10.00 per share issued to Alta’s equityholders, which include Mr. Greenawalt (the “Holders”).⁽¹⁾

Immediately prior to the closing, pursuant to the forward purchase agreement, dated as of April 8, 2019 (the “Forward Purchase Agreement”), by and between the Company and B. Riley Principal Investments, LLC (“BRPI”), the Company issued to BRPI 2,500,000 shares of common stock for $10.00 per share, for an aggregate purchase price of $25,000,000, plus 1,250,000 warrants.

Immediately prior to the Closing, pursuant to subscription agreements (the “Subscription Agreements”) with institutional and accredited investors (the “PIPE investors”), the Company (i) issued to the PIPE investors an aggregate of 3,500,000 shares of common stock for $10.00 per share, for an aggregate purchase price of $35,000,000, plus an additional 178,947 shares of common stock (the “inducement shares”), and (ii) transferred to the PIPE investors an aggregate of 1,275,000 warrants (the “inducement warrants”). In connection therewith, B. Riley Principal Sponsor Co., LLC (the “Sponsor”) forfeited 178,947 shares of common stock to the Company for cancellation for no consideration and BRPI and the Sponsor transferred an aggregate of 1,275,000 warrants to the Company for no consideration.

In addition, immediately prior to the Closing, the Sponsor forfeited to the Company for cancellation for no consideration an aggregate of an additional 1,470,855 shares of common stock.

Introduction

The following unaudited pro forma condensed combined financial statements of the Company present the combination of the financial information of the Company, Alta, Northland Industrial Truck Co. (“NITCO”), Liftech Equipment Companies, Inc. (“Liftech”) and FlaglerCE Holdings, LLC (“Flagler”), adjusted to give effect to the Business Combination, the equity financing provided by the forward purchase agreement, the subscription agreements with the PIPE investors and the backstop agreement (collectively, the “equity financing”), and the debt financing (as defined below). The following unaudited pro forma condensed combined financial information has been prepared in accordance with Article 11 of Regulation S-X.

In connection with the Business Combination and as a condition under the Merger Agreement, the Company entered into credit agreements on February 3, 2020, which are effective upon the closing of the Business Combination (the “debt financing”), for the purpose of financing the repayment of Alta’s existing net debt, a portion of the consideration payable under the Merger Agreement, costs and expenses incurred bythe parties in connection with the Business Combination and general corporate expenditures. The credit facilities are comprised of a second lien note purchase agreement in an aggregate principal amount of $155 million and an asset based loan revolving credit facility in an aggregate principal amount of up to $300 million, with $115 million drawn on upon consummation of the Business Combination.

⁽¹⁾ At closing aggregate consideration was $403 million and existing gross debt pay off of $284 million.

The following unaudited pro forma condensed combined balance sheet as of September 30, 2019 assumes that the Business Combination, equity financing and debt financing occurred on September 30, 2019. The following unaudited pro forma condensed combined statement of operations for the year ended December 31, 2018 and for the nine months ended September 30, 2019 gives pro forma effect to the Business Combination, equity financing and debt financing as if they had been completed on January 1, 2018.

In addition, the following unaudited pro forma condensed combined statement of operations for the year ended December 31, 2018 and for the nine months ended September 30, 2019 gives pro forma effect to the acquisition by Alta of NITCO that closed on May 1, 2019 as if it had been completed on January 1, 2018.

Further, the following unaudited pro forma condensed combined statement of operations for the year ended December 31, 2018 and for the nine months ended September 30, 2019 gives pro forma effect to the acquisitions by Alta of Liftech and Flagler that closed on February 14, 2020 as if such acquisitions had been completed on January 1, 2018, while the following unaudited pro forma condensed combined balance sheet as of September 30, 2019 gives pro forma effect to such acquisitions as if they had been completed on September 30, 2019.

The unaudited pro forma condensed combined financial statements have been presented for illustrative purposes only and do not necessarily reflect what the Company’s financial condition or results of operations would have been had the Business Combination occurred on the dates indicated. Further, the unaudited pro forma condensed combined financial information also may not be useful in predicting the future financial condition and results of operations of the Company. The actual financial position and results of operations may differ significantly from the pro forma amounts reflected herein due to a variety of factors. The unaudited pro forma adjustments represent management’s estimates based on information available as of the date of these unaudited pro forma condensed combined financial statements and are subject to change as additional information becomes available and analyses are performed.

This information has been developed from and should be read together with Alta’s, NITCO’s, Liftech’s and Flagler’s audited and unaudited financial statements and related notes incorporated by reference, the sections of the Company’s definitive proxy statement filed with the U.S. Securities and Exchange Commission on January 23, 2020 titled “Alta’s Management’s Discussion and Analysis of Financial Condition and Results of Operations” incorporated by reference, and other financial information incorporated by reference. The financial information as of and for the nine months ended September 30, 2019, and for the year ended December 31, 2018 was derived from the unaudited and audited financial statements and related notes included in the Company’s definitive proxy statement filed with the U.S. Securities and Exchange Commission on January 23, 2020. The information related to the Company should be read together with the section of the Company’s definitive proxy statement filed with the U.S. Securities and Exchange Commission on January 23, 2020 titled “BRPM’s Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

The Business Combination is accounted for under the scope of the Financial Accounting Standards Board’s Accounting Standards Codification (“ASC”) Topic 805, Business Combinations (“ASC 805”), as a reverse recapitalization, with no goodwill or other intangible assets recorded, in accordance with GAAP. Alta has been determined to be the accounting acquirer based on the evaluation of the following facts and circumstances:

● Ryan Greenawalt, the sole owner and CEO of Alta, is expected to have the largest minority interest of the combined company,

● Ryan Greenawalt will serve as a member of the board of directors of the combined company, together with two individuals designated by him,

● Alta’s senior management will comprise the senior management of the combined company,

● The relative size of Alta compared to the Company; and

● Alta’s operations will comprise the ongoing operations of the combined company.

ASC 805 provides that in identifying the acquiring entity in a transaction effected through an exchange of equity interests, all pertinent facts and circumstances must be considered, including: the relative voting rights ofthe stockholders of the constituent companies in the combined company; the existence of a large minority voting interest in the combined entity (if no other owner or organized group of owners has a significant voting interest); the composition of the board of directors and senior management of the combined company; the relative size of each company; and the terms of the exchange of equity securities in the transaction, including payments of any premium. The preponderance of the evidence discussed above supports the conclusion that Alta is the accounting acquirer in the Business Combination. Under this method of accounting, the Company will be treated as the “acquired” company for financial reporting purposes. Accordingly, for accounting purposes, the Business Combination will be treated as the equivalent of Alta issuing stock for the net assets of the Company, accompanied by a recapitalization. The net assets of the Company will be stated at historical cost, with no goodwill or other intangible assets recorded.

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Description of the Business Combination

The Company paid off the existing gross debt of Alta (approximately $285 million), and Alta’s equity holders, which include Greenawalt, received aggregate consideration with a value equal to $119 million, which consisted of (i) $43 million in cash and (ii) $76 million of shares of our common stock, or 7,600,000 shares valued at $10.00 per share.

In the Business Combination, Merger Sub merged with and into Alta, the separate corporate existence of Merger Sub ceased, and Alta became a wholly-owned subsidiary of BPRM. Upon the Closing, the Company changed its name to “Alta Equipment Group Inc.”

Financing for the Business Combination and for related transaction expenses consisted of:

(i) $135.1 million of proceeds from the Company’s IPO on deposit in the trust account (plus any interest income accrued thereon since the IPO), net of any redemption of shares of Class A common stock in connection with the Business Combination;

(ii) $25 million of proceeds from the forward purchase agreement with BRPI or its designees;

(iii) $35 million of proceeds from the subscription agreements with the PIPE investors;

(iv) Amounts drawn under the credit facilities received in the debt financing; and

(v) $76 million of rollover equity from the Holders.

The unaudited pro forma condensed combined financial information has been prepared after giving effect to the Business Combination, and the redemption rights exercised by the Company’s public stockholders, where 1,049,036 public shares were redeemed.

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ALTA EQUIPMENT GROUP, INC.

UNAUDITED PRO FORMA CONDENSED

COMBINED BALANCE SHEET

September 30, 2019

	Historical as of September 30, 2019		Alta Pro Forma September 30, 2019
(in thousands, except for per share data)	BRPM		Alta Equipment Holdings, Inc. Pro Forma Combined (1)			Pro Forma Adjustments For Equity Offering		Note		As Adjusted for Equity Offering			Pro Forma Adjustments			Note	Pro Forma Combined
ASSETS
CURRENT ASSETS
Cash	$	983	$	2,141		$	35,000	(1)		$	63,124						$	20,506
							25,000	(2)						135,126		(3)
														(52,092	)	(4)
														(17,870	)	(5)
														(13,000	)	(6)
														(94,782	)	(7)
Accounts receivable, net		-		118,170			-				118,170							118,170
Inventories, net		-		187,279			-				187,279							187,279
Prepaid expenses and other Current Assets		149		6,848			-				6,997							6,997
Total current assets		1,132		314,438			60,000				375,570			(42,618	)			332,952
PROPERTY AND EQUIPMENT, NET				253,895							253,895							253,895
OTHER ASSETS
Cash held in Trust Account		145,402		-							145,402			(145,402	)	(3)		-
Buyback residual assets, net of current portion		-		735			-				735			-				735
Goodwill, net		-		31,620			-				31,620			-				31,620
Intangible assets, net		-		1,624			-				1,624			-				1,624
Other assets		-		2,000			-				2,000			-				2,000
Total other assets		145,402		35,979			-		��		181,381			(145,402	)			35,979
TOTAL ASSETS		146,534		604,312			60,000				810,846			(188,020	)			622,826
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY
CURRENT LIABILITIES
Income taxes payable		280		-			-				280			-				280
Note payable - related party		70		-			-				70			-				70
Lines of credit and floor plans		-		314,775			-				314,775			(85,457	)	(4)		229,318
Current portion of long-term debt		-		8,694			-				8,694			19,488		(4)		28,182
Accounts payable		280		38,108			-				38,388			-				38,388
Deferred revenue		-		3,914			-				3,914			-				3,914
Customer deposits		-		4,643			-				4,643			-				4,643
Accrued expenses		-		17,941			-				17,941			-				17,941
Other current liabilities		-		8,660			-				8,660			-				8,660
Total current liabilities		630		396,735			-				397,365			(65,969	)			331,396
LONG-TERM LIABILITIES
Long-term debt, net of current portion, debt discounts and deferred financing costs		-		85,756			-				85,756			47,540		(4)		133,296
Capital lease obligations, net of current portion		-		1,626			-				1,626			-				1,626
Buyback residual obligations, net of current portion		-		750			-				750			-				750
Lease Liability, long-term		-		2,336			-				2,336			-				2,336
GPO Lease Liability - Residual		-		8,417			-				8,417			-				8,417
Deferred tax liabilities		-		-			-				-			10,672		(8)		10,672
Other liabilities		-		869			-				869			-				869
Warrant liability		-		30,000			-				30,000			(30,000	)	(4)		-
Total long-term liabilities		-		129,754			-				129,754			28,212				157,966
Total Liabilities		630		526,489			-				527,119			(37,757	)			489,362
Common stock		140,905		-			-				140,905			(10,276	)	(3)		130,629
STOCKHOLDERS’ (DEFICIT) EQUITY
Preferred stock		-		-							-							-
Treasury stock		-		-							-							-
Additional paid-in capital		3,955		93,975			35,000	(1)			157,930			(10,672	)	(8)		39,476
							25,000	(2)						(13,000	)	(6)
		-		-			-				-			(94,782	)	(7)		-
Retained earnings (deficit)		1,044		(14,582	)		-				(13,538	)		(3,663	)	(4)		(17,201	)
		-					-				-			(17,870	)	(5)		(17,870	)
Members’ equity		-		(1,570	)		-				(1,570	)		-				(1,570	)
TOTAL STOCKHOLDERS’ (DEFICIT) EQUITY		145,904		77,823			60,000				283,727			(150,263	)			133,464
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY		146,534		604,312			60,000				810,846			(188,020	)			622,826

(1) Refer to Note 3(a) for lower-lever pro forma balance sheet adjustments made to Alta.

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ALTA EQUIPMENT GROUP, INC.

UNAUDITED PRO FORMA CONDENSED

COMBINED STATEMENT OF OPERATIONS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2019

	Historical for
	the nine
	months ended
	September 30,
	2019
(in thousands, except share and per share amounts)	BRPM			Alta Equipment Holdings, Inc. Pro Forma Combined (1)			As Adjusted for Equity Offering			Pro Forma Adjustments			Note	Pro Forma Combined
Revenues:
New, used and rental equipment sales		-			324,949			324,949			-				324,949
Parts sales		-			95,156			95,156			-				95,156
Service revenue		-			96,168			96,168			-				96,168
Rental Revenue		-			88,413			88,413			-				88,413
Total Revenue		-			604,686			604,686			-				604,686
Cost of revenues:
New, used and rental equipment sales		-			288,277			288,277			-				288,277
Parts sales		-			63,485			63,485			-				63,485
Service revenue		-			35,441			35,441			-				35,441
Rental revenue		-			13,587			13,587			-				13,587
Rental depreciation		-			46,104			46,104			-				46,104
Total Cost of revenue		-			446,894			446,894			-				446,894
Gross profit		-			157,792			157,792			-				157,792
General and administrative expenses		321			137,896			138,217			(63	)	(1)		138,154
Depreciation expense		-			2,974			2,974			-				2,974
Total general and administrative expenses		321			140,870			141,191			(63	)			141,128
Income from operations		(321	)		16,922			16,601			63				16,664
Other income (expense)
Interest income (expense)		1,654			(17,719	)		(16,065	)		1,629		(2)		(14,436	)
Other income		-			1,628			1,628			-				1,628
Other expense		-			(24	)		(24	)		-				(24	)
Gain on sale of assets		-			33			33			-				33
Change in fair market value of warrants		-			(28,272	)		(28,272	)		-				(28,272	)
Total other expense		1,654			(44,354	)		(42,700	)		1,629				(41,071	)
Provision for income taxes		(280	)		-			(280	)		6,499		(3)		6,219
Net income (loss)	$	1,053		$	(27,432	)	$	(26,379	)	$	8,191			$	(18,188	)
Weighted average common shares outstanding basic and diluted		3,952,025													29,511,359		(4)
Net income (loss) per share - basic and diluted		(0.05	)												(0.62	)	(4)

(1) Refer to Note 3(e) for lower-lever pro forma statement of operations adjustments made to Alta.

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ALTA EQUIPMENT GROUP, INC.

UNAUDITED PRO FORMA CONDENSED

COMBINED STATEMENT OF OPERATIONS FOR

THE YEAR ENDED DECEMBER 31, 2018

	Historical for the year ended December 31, 2018
(in thousands, except share and per share amounts)	BRPM			Alta Equipment Holdings, Inc. Pro Forma Combined (1)			As Adjusted for Equity Offering			Pro Forma Adjustments			Note	Pro Forma Combined
New, used and rental equipment sales	$	-		$	399,566		$	399,566		$	-			$	399,566
Parts sales		-			119,600			119,600			-				119,600
Service revenue		-			112,660			112,660			-				112,660
Rental Revenue		-			99,533			99,533			-				99,533
Net revenue		-			731,359			731,359			-				731,359
Cost of revenues:
New, used and rental equipment sales		-			343,745			343,745			-				343,745
Parts sales		-			79,979			79,979			-				79,979
Service revenue		-			38,456			38,456			-				38,456
Rental revenue		-			17,525			17,525			-				17,525
Rental depreciation		-			56,850			56,850			-				56,850
Cost of revenue		-			536,555			536,555			-				536,555
Gross profit		-			194,804			194,804			-				194,804
General and administrative expenses		-			163,566			163,566			(28	)	(1)		163,538
Depreciation expense		-			5,022			5,022			-		-		5,022
Total general and administrative expenses		-			168,588			168,588			(28	)	-		168,560
Income from operations		-			26,216			26,216			28				26,244
Other income (expense)
Interest income (expense)		-			(20,407	)		(20,407	)		(646	)	(2)		(21,053	)
Other income		-			2,248			2,248			-				2,248
Change in fair market value of warrants		-			(400	)		(400	)		-				(400	)
Total other expense		-			(18,559	)		(18,559	)		(646	)			(19,205	)
Provision for income taxes		(1	)		-			(1	)		(1,874	)	(3)		(1,875	)
Net income (loss)	$	(1	)	$	7,657		$	7,656		$	(2,493	)		$	5,164
Weighted average common shares outstanding basic and diluted		3,125,000													29,511,359
Net income (loss) per share - basic and diluted		(0.00	)												0.17		(4)

(1) Refer to Note 4(a) for lower-lever pro forma statement of operations adjustments made to Alta.

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NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

Note 1 — Description of the Business Combination

Basis of presentation

The historical financial information has been adjusted in the unaudited pro forma condensed combined financial information to give effect to events that are (1) directly attributable to the Business Combination, (2) factually supportable, and (3) with respect to the statement of operations, expected to have a continuing impact on the combined results. The pro forma adjustments are prepared to illustrate the estimated effect of the Business Combination and certain other adjustments.

The Company’s historical results reflect the audited consolidated statement of operations for the year ended December 31, 2018, unaudited condensed balance sheet as of September 30, 2019 and unaudited condensed statement of operations for the nine-months ended September 30, 2019 under GAAP. Alta’s historical results reflect their audited consolidated statement of operations for the year ended December 31, 2018, unaudited condensed balance sheet as of September 30, 2019 and unaudited condensed statement of operations for the nine-months ended September 30, 2019 under GAAP. NITCO’s historical results reflect the audited consolidated statement of income for the year ended October 31, 2018 and unaudited condensed statement of income for the 4-months ended February 28, 2019. As the acquisition with NITCO closed on May 1, 2019, Alta’s September 30, 2019 statement of operations includes the operations of NITCO for the 5-months ended September 30, 2019. Therefore, in order to provide a full nine-months of operations, the four months ended February 28, 2019 has been included. As NITCO has a different fiscal year end (October 31st), the period from March 1, 2019 through April 30, 2019 is excluded from the pro forma condensed combined statements of operations. An unaudited condensed consolidated balance sheet is not reflected in the pro forma condensed combined balance sheet as the transaction with Alta closed on May 1, 2019 and is therefore reflected in Alta’s consolidated balance sheet as of September 30, 2019.

On February 14, 2020, Alta acquired both Liftech and Flagler. The historical results of both companies reflect their audited consolidated statements of income for the year ended December 31, 2018, unaudited condensed consolidated balance sheets as of September 30, 2019 and unaudited condensed consolidated statements of income for the nine-months ended September 30, 2019.

Description of the Business Combination

As previously mentioned, Alta Equipment Group Inc. (formerly known as B. Riley Principal Merger Corp.), a Delaware corporation (the “Company”), consummated its previously announced acquisition of Alta Equipment Holdings, Inc., a Michigan corporation (“Alta”), on February 14, 2020 (the “Closing Date”), pursuant to the Agreement and Plan of Merger, dated as of December 12, 2019 (the “Merger Agreement”), by and among the Company, BR Canyon Merger Sub Corp., a Delaware corporation and wholly-owned subsidiary of the Company (“Merger Sub”), Alta and Ryan Greenawalt. The transactions contemplated by the Merger Agreement are referred to herein as the “Business Combination.”  

Under applicable accounting standards, Alta will be the accounting acquirer in the Business Combination, which will be treated as a reverse recapitalization. Accordingly, the accounting for the transaction is similar to that of a capital infusion to Alta. Net assets of the Company will be stated at historical cost, with no goodwill or intangible assets recorded.

The following table sets forth the net assets of the Company as of September 30, 2019 (in thousands):

Cash	$	983
Prepaid expenses and other current  assets		149
Cash held in Trust Account		145,402
Payable to a related party		(70	)
Income taxes payable		(280	)
Accounts payable		(280	)
Net assets acquired	$	145,904

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For purposes of the unaudited pro forma condensed combined financial information, the table below represents the sources and uses of funds as it relates to the Business Combination:

Sources and Uses (in thousands)

Sources			Uses
BRPM Cash Held in Trust(1)	$	135,126	Pay down of Existing Debt(6)	$	314,787
BRPI Forward Purchase Agreement(2)		25,000	Cash to Existing Alta Shareholders(7)		13,000
Existing Alta Shareholders Roll(3)		76,000	Shares to Existing Alta Shareholders(3)		76,000
PIPE(4)		35,000	Alta Acquisitions(8)		94,782
New Term Loan(5)		155,000	Estimated Fees and Expenses(9)		25,175
Draw on New ABL(5)		115,000	Excess Cash to Balance Sheet(10)		17,382
Total Sources	$	541,126	Total Uses	$	541,126

(1)	Represents the amount of the restricted investments and cash held in the Trust account upon consummation of the Business Combination.
(2)	Represents the forward purchase agreement entered into with BRPI to provide for the purchase by it (or its designees) of up to an aggregate of 2,500,000 units at $10.00 per unit for an aggregate purchase price of $25,000,000 in a price placement to close concurrently with the closing of the Business Combination. The proceeds from the sale of the forward purchase units were used as part of the consideration to the holders in the Business Combination, to pay expenses in connection with the Business Combination and for working capital in the post- business combination company. The forward purchase was intended to provide the Company with a minimum funding level for the Business Combination.
(3)	Represents the amount attributable to the existing shareholders of Alta.
(4)	Represents the issuance, in a private placement consummated concurrently with the closing, of up to 3,678,947 shares of common stock.
(5)	Represents proceeds from the refinancing of the Company’s existing indebtedness upon closing of the Business Combination.
(6)	Represents the amount of existing debt and warrants that the combined Company paid down upon closing of the Business Combination that will allow for adequate cash to remain on the balance sheet for funding of operations and working capital needs. At closing, the pay down of existing debt, including warrants was $314 million.
(7)	Represents the amount of cash paid to the existing Alta Shareholder and key executives as part of the payout of the awards associated with the long-term equity linked incentive plan.
(8)	Represents the total cost of Alta acquiring Liftech and Flagler. At closing, the total cost of the acquisitions was $93.2 million.
(9)	Represents the total fees and expenses incurred as part of the acquisition paid at the closing of the Business Combination. At closing, total transaction fees and expenses were $22.7 million.
(10)	Represents remaining cash that will be used to fund operations and working capital needs of the Company after the closing of the Business Combination. Note that the Company will have ample liquidity on its ABL facility to meet the operating cash requirements of the business (total borrowing capacity remaining of $185 million). At closing, total excess cash was $22.2 million.

Basis of the Pro Forma Presentation

As a result of the consummation of the Business Combination, the Company will adopt Alta’s accounting policies. Similarly, Flagler and Liftech will adopt Alta’s accounting policies. Alta may identify differences between the accounting policies of the companies, that when conformed, could have a material impact on the consolidated financial statements of the combined entity.

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Note 2 — Reclassifications to Historical Financial Information of the Company

Certain balances and transactions presented in the historical financial statements of the Company included within the unaudited pro forma condensed combined financial information have been reclassified to conform to the presentation of financial statements of Alta as indicated in the table below.

Reclassifications to historical financial information of NITCO, Liftech and Flagler to conform to the presentation of Alta are included in Notes 3 and 4 below.

The Company’s Statement of Operations Reclassifications for the Nine Months Ended September 30, 2019

(in thousands)	As per Financial Statements		Reclassification			As Reclassified
General and administrative expenses				321			321
Operating costs		321		(321	)		—

9

Note 3 — Reclassifications and Adjustments to Historical Information of Alta Equipment Holdings, Inc. for the 9-months ended September 30, 2019

(a) Pro forma balance sheet of Alta Equipment Holdings, Inc. combined

The following table provides the pro forma balance sheet of Alta Equipment Holdings, Inc. as of September 30, 2019 as if Liftech and Flagler had been acquired on September 30, 2019. As NITCO was acquired by Alta effective May 1, 2019, they are included within the Alta amounts as of September 30, 2019.

ALTA EQUIPMENT HOLDINGS, INC. PRO FORMA BALANCE SHEET AS OF SEPTEMBER 30, 2019

	Alta Equipment Holdings, Inc.									Liftech		Flagler
(in thousands, except share and per share amounts)	Alta Balance			Pro Forma			Alta Equipment Holdings, Inc. Pro Forma (2)			Liftech Pro Forma (3)		Flagler Pro Forma (4)			Alta Equipment Holdings, Inc. Pro Forma Combined
ASSETS
CURRENT ASSETS
Cash	$	2,141		$	-		$	2,141		$	-	$	-		$	2,141
Accounts receivable, net		92,580			-			92,580			5,229		20,361			118,170
Inventories, net		142,813			-			142,813			7,887		36,579			187,279
Prepaid expenses and other current assets		5,380			-			5,380			456		1,012			6,848
Total current assets		242,914			-			242,914			13,572		57,952			314,438
PROPERTY AND EQUIPMENT, NET		199,670			-			199,670			6,512		47,713			253,895
OTHER ASSETS
Buyback residual assets, net of current portion		735			-			735			-		-			735
Goodwill, net		9,950			21,670	(1)		31,620			-		-			31,620
Intangible assets, net		1,624			-			1,624			-		-			1,624
Other assets		2,000			-			2,000			-		-			2,000
Total other assets		14,309			21,670			35,979			-		-			35,979
TOTAL ASSETS		456,893			21,670			478,563			20,084		105,665			604,312
CURRENT LIABILITIES
Lines of credit and floor plans		280,329			-			280,329			4,576		29,870			314,775
Current portion of long-term debt		8,694			-			8,694			-		-			8,694
Accounts payable		26,967			-			26,967			1,716		9,425			38,108
Deferred revenue		3,464			-			3,464			160		290			3,914
Customer deposits		4,643			-			4,643			-		-			4,643
Accrued expenses		13,210			-			13,210			570		4,161			17,941
Other current liabilities		7,660			1,000	(1)		8,660			-		-			8,660
Total current liabilities		344,967			1,000			345,967			7,022		43,746			396,735
LONG-TERM LIABILITIES
Long-term debt, net of current portion, debt discounts and deferred financing costs		85,756			-			85,756			-		-			85,756
Capital lease obligations, net of current portion		1,626			-			1,626			-		-			1,626
Buyback residual obligations, net of current portion		750			-			750			-		-			750
Lease Liability, long-term		2,336			-			2,336			-		-			2,336
GPO Lease Liability - Residual		8,417			-			8,417			-		-			8,417
Other liabilities		-			-			-			-		869			869
Warrant liability		30,000			-			30,000			-		-			30,000
Total long-term liabilities		128,885			-			128,885			-		869			129,754
STOCKHOLDERS’ (DEFICIT) EQUITY
Common stock		-			-			-			-		-			-
Preferred stock		-			-			-			-		-			-
Treasury stock		-			-			-			-		-			-
Additional paid-in capital		-			20,670			20,670			11,736		61,569			93,975
Retained earnings (deficit)		(16,959	)		-			(16,959	)		1,326		1,051			(14,582	)
Members’ equity		-			-			-			-		(1,570	)		(1,570	)
TOTAL STOCKHOLDERS’ (DEFICIT) EQUITY		(16,959	)		20,670			3,711			13,062		61,050			77,823
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY	$	456,893		$	21,670		$	478,563		$	20,084	$	105,665		$	604,312

(2) Refer to Note 3(b) for pro forma adjustments made to Alta.

(3) Refer to Note 3(c) for reclassification of Liftech historical information and pro forma adjustments.

(4) Refer to Note 3(d) for reclassification of Flagler historical information and pro forma adjustments.

10

(b) Pro forma balance sheet adjustments of Alta

(1) Reflects the $20.7M adjustment to record goodwill upon consummation of the Liftech and Flagler acquisitions. Goodwill reflects the difference between purchase price and net assets acquired. The $1M adjustment reflects an increase to purchase price resulting from a contingent purchase price adjustment set forth in the acquisition agreement.

(c) Reclassifications and pro forma adjustments of Liftech

	Liftech
(in thousands, except share and per share amounts)	Liftech Reclassified (1)			Pro Forma				Liftech Pro Forma (3)
ASSETS
CURRENT ASSETS
Cash	$	9		$	(9	)	(2)	$	-
Accounts receivable, net		5,229			-				5,229
Inventories, net		7,887			-				7,887
Due from affiliate		116			(116	)	(2)		-
Prepaid expenses and other current assets		456			-				456
Total current assets		13,697			(125	)			13,572
PROPERTY AND EQUIPMENT, NET		6,512			-				6,512
OTHER ASSETS
Goodwill, net		731			(731	)	(4)		-
Intangible assets, net		383			(383	)	(4)		-
Other assets		1,785			(1,785	)	(2)		-
Total other assets		2,899			(2,899	)			-
TOTAL ASSETS		23,108			(3,024	)			20,084
CURRENT LIABILITIES
Lines of credit and floor plans		13,728			(8,322	)	(3)		5,406
Current portion of long-term debt		696			(696	)	(3)		-
Accounts payable		1,716			-				1,716
Deferred revenue		160			-				160
Accrued expenses		570			-				570
Total current liabilities		16,870			(9,018	)			7,852
LONG-TERM LIABILITIES
Long-term debt, net of current portion, debt discounts and deferred financing costs		2,578			(2,578	)	(3)		-
Note payable - related party		780			(780	)	(2)		-
Total long-term liabilities		3,358			(3,358	)			-
STOCKHOLDERS’ (DEFICIT) EQUITY
Common stock		-			-				-
Preferred stock		-			-				-
Treasury stock		(1,300	)		1,300		(5)		-
Additional paid-in capital		611			11,595		(3)		12,206
					(1,300	)	(5)		(1,300	)
Retained earnings (deficit)		3,569			(1,130	)	(2)		2,439
		-			(1,113	)	(4)		(1,113	)
Members’ equity		-			-				-
TOTAL STOCKHOLDERS’ (DEFICIT) EQUITY		2,880			9,352				12,232
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY	$	23,108		$	(3,024	)		$	20,084

(1) Reflects adjustments for balances presented in historical financial statements of Liftech included within the unaudited pro forma condensed financial information have been reclassified to conform to the presentation of financial statements of Alta Equipment Holdings, Inc., as indicated in the table below.

11

	As per Financial Statements		Reclassifications			As reclassified
PROPERTY AND EQUIPMENT, NET	$	1,334	$	5,178		$	6,512
Rental equipment, net		5,178		(5,178	)		—
Lines of credit and floor plans		11,280		2,448	(a)		13,728
Accounts Payable		4,164		(2,448	)(a)		1,716

(a) Reflects floor plan financing activities reclassified into lines of credit and floor plans expected to be assumed as part of the acquisition (see note 2 below).

(2) Reflects assets not acquired and liabilities not assumed as part of the acquisition by Alta. As such, the historical financials are adjusted to reflect their removal of the related Balance Sheet impact upon consummation of the acquisition.

(3) The decrease to debt and other financing liabilities reflects the effects of extinguishment of Liftech’s outstanding debt related to the acquisition by Alta. See Alta pro forma adjustments in Note 5(a) for related impact on the debt re- financing upon consummation of the acquisition. The remaining balance reflects floor plan financing activities that were assumed as part of the acquisition by Alta.

(4) Reflects adjustment to remove Liftech’s historical identifiable intangible assets and goodwill of $383K and $731K, respectively. Intangible assets will be re-measured at fair value and any resulting goodwill associated with the acquisition by Alta will be reflected in the Alta pro forma balance sheet adjustments in Note 3(b) above.

(5) Reflects adjustment to eliminate historical treasury stock from Liftech.

12

(d) Reclassifications and pro forma adjustments of Flagler

	Flagler
(in thousands, except share and per share amounts)	Flagler Reclassified (1)			Pro Forma				Flagler Pro Forma (4)
ASSETS
CURRENT ASSETS
Cash	$	1,384		$	(1,384	)	(2)	$	-
Accounts receivable, net		20,361			-				20,361
Inventories, net		36,579			-				36,579
Assets held for sale		207			(207	)	(2)		-
Prepaid expenses and other current assets		1,012			-				1,012
Total current assets		59,543			(1,591	)			57,952
PROPERTY AND EQUIPMENT, NET		47,713			-				47,713
OTHER ASSETS
Other assets		55			(55	)	(2)		-
Total other assets		55			(55	)			-
TOTAL ASSETS		107,311			(1,646	)			105,665
CURRENT LIABILITIES
Note payable - related party		300			(300	)	(2)		-
Lines of credit and floor plans		80,777			(50,907	)	(3)		29,870
Current portion of long-term debt		9,513			(9,513	)	(3)		-
Current portion of capital lease obligations		308			(308	)	(3)		-
Accounts payable		9,425			-				9,425
Deferred revenue		290			-				290
Accrued expenses		4,161			-				4,161
Liabilities held for sale		100			(100	)	(2)		-
Total current liabilities		104,874			(61,128	)			43,746
LONG-TERM LIABILITIES
Long-term debt, net of current portion, debt discounts and deferred financing costs		841			(841	)	(3)		-
Capital lease obligations, net of current portion		-			-		(3)		-
Lease Liability, long-term		-			-				-
Other liabilities		3,166			(2,297	)	(2)		869
Warrant liability		-			-				-
Total long-term liabilities		4,007			(3,138	)			869
STOCKHOLDERS’ (DEFICIT) EQUITY
Common stock		-			-				-
Preferred stock		-			-				-
Additional paid-in capital		-			61,569		(3)		61,569
									-
Retained earnings (deficit)		-			1,051		(2)		1,051
									-
Members’ equity		(1,570	)		-				(1,570	)
TOTAL STOCKHOLDERS’ (DEFICIT) EQUITY		(1,570	)		62,620				61,050
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY	$	107,311		$	(1,646	)		$	105,665

(1) Reflects adjustments for balances presented in historical financial statements of Flagler included within the unaudited pro forma condensed financial information have been reclassified to conform to the presentation of financial statements of Alta Equipment Holdings, Inc., as indicated in the table below.

	As per FinancialStatements		Reclassifications			As reclassified
PROPERTY AND EQUIPMENT, NET	$	3,324	$	44,389		$	47,713
Rental equipment, net		44,389		(44,389	)		—

(2) Reflects assets not acquired and liabilities not assumed as part of the acquisition by Alta. As such, the historical financials are adjusted to reflect their removal of the related Balance Sheet impact upon consummation of the acquisition.

(3) The decrease to debt and other financing liabilities reflects the effects of extinguishment of Flagler’s outstanding debt related to the acquisition by Alta. See Alta pro forma adjustments in Note 5(a) for related impact on the debt re- financing upon consummation of the acquisition.

13

(e) Pro forma statement of operations of Alta Equipment Holdings, Inc.

The following table provides the pro forma statement of operations of Alta Equipment Holdings, Inc. for the nine months ended September 30, 2019 as if NITCO, Liftech and Flagler had been acquired on January 1, 2018. NITCO was acquired by Alta effective May 1, 2019. Liftech and Flagler were acquired on February 14, 2020. The pro forma results do not include any anticipated cost synergies or other effects of the integration of these entities into Alta.

ALTA EQUIPMENT HOLDINGS, INC.

PRO FORMA FINANCIAL STATEMENT OF OPERATIONS

FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2019

	Alta Equipment Holdings, Inc.
(Amounts in thousands, except for per share information)	Alta Balance			Alta Pro Forma			Alta Pro Forma (a)			NITCO (11/1/18- 2/28/19) NITCO Pro Forma (b)			Liftech Pro Forma (c)			Flagler Pro forma (d)			Alta Equipment Group, Inc. Pro Forma Combined
Revenues:
New, used and rental equipment sales	$	193,909		$	-		$	193,909		$	24,572		$	14,628		$	91,840		$	324,949
Parts sales		60,017			-			60,017			6,494			6,463			22,182			95,156
Service revenue		67,165			-			67,165			8,286			8,356			12,361			96,168
Rental Revenue		66,903			-			66,903			5,824			2,309			13,377			88,413
Net revenue		387,994			-			387,994			45,176			31,756			139,760			604,686
Cost of revenues:
New, used and rental equipment sales		169,695			-			169,695			21,715			12,991			83,876			288,277
Parts sales		39,353			-			39,353			3,740			4,380			16,012			63,485
Service revenue		24,263			-			24,263			2,039			2,898			6,241			35,441
Rental revenue		11,403			-			11,403			593			75			1,516			13,587
Rental depreciation		32,947			-			32,947			3,420			858			8,879			46,104
Cost of revenue		277,661			-			277,661			31,507			21,202			116,524			446,894
Gross profit		110,333			-			110,333			13,669			10,554			23,236			157,792
General and administrative expenses		95,625			(278	)(1)		95,347			12,496			9,438			20,615			137,896
Depreciation expense		1,826			-			1,826			147			310			691			2,974
Total general and administrative expenses		97,451			(278	)		97,173			12,643			9,748			21,306			140,870
Income from operations		12,882			278			13,160			1,026			806			1,930			16,922
Other income (expense)
Interest income (expense)		(14,726	)		(33	)(2)		(15,738	)		(280	)		(169	)		(1,532	)		(17,719	)
					(979	)(3)
Other income		532			-			532			443			251			402			1,628
Other expense		(24	)		-			(24	)		-			-			-			(24	)
Gain on sale of assets		33			-			33			-			-			0			33
Change in fair market value of warrants		(28,272	)		-			(28,272	)		-			-			-			(28,272	)
Total other expense		(42,457	)		(1,012	)		(43,469	)		163			82			(1,130	)		(44,354	)
Provision for income taxes		-			-			-			-			-			-			-
Net income (loss)	$	(29,575	)	$	(734	)	$	(30,309	)	$	1,189		$	888		$	800		$	(27,432	)

(a) Refer to Note 3(f) for pro forma adjustments made to Alta.

(b) Refer to Note 3(g) for reclassification of NITCO historical information and pro forma adjustments.

(c) Refer to Note 3(h) for reclassification of Liftech historical information and pro forma adjustments.

(d) Refer to Note 3(i) for reclassification of Flagler historical information and pro forma adjustments.

14

(f) Pro-forma statement of operations adjustments of Alta

(1) Reflects adjustments made to eliminate non-recurring transaction costs previously recognized in the historical financial statements related to acquisitions and transactions completed prior to the Business Combination between the Company and Alta.

(2) Reflects an adjustment to amortization expense resulting from the increase in debt issuance costs associated with the Company’s May 1, 2019 increase in borrowing capacity to partially finance the acquisition of NITCO. The amortization expense above reflects four months of amortization expense as the Statement of Operations already includes the amortization expense recorded for the period May 1, 2019 through September 30, 2019.

(3) Reflects an adjustment to interest expense resulting from the interest on the increased borrowing capacities of debt to partially finance the acquisition of NITCO. The additional interest expense of $979K recognized above reflects four months of interest expense as the Statement of Operations already includes interest expense recorded for the period May 1, 2019 through September 30, 2019. As this is variable rate debt with interest rates of LIBOR + an applicable margin, a 1/8 change in the interest rate would result in a $122K change of interest expense being recognized.

15

(g) Pro-forma statement of operations adjustments of NITCO (November 1, 2018 – February 28, 2019)

The NITCO transaction closed on May 1, 2019. Therefore, NITCO’s results of operations from May 1, 2019 to September 30, 2019 are included in Alta’s Statement of Operations for the nine-months ended September 30, 2019. Due to NITCO’s fiscal year-end of October 31, 2018, the period from March 1, 2019 to April 30, 2019 is excluded from the pro forma statement of operations results. NITCO’s total revenue for this period was $22.8 million. The below represents the pro forma statement of operations adjustments for NITCO for the four months ended February 28, 2019.

	NITCO
	(11/1/18 - 2/28/19)
	NITCO							NITCO Pro
(Amounts in thousands, except for per share information)	Reclassified (1)			Pro Forma				Forma (2)
Revenues:
New, used and rental equipment sales	$	24,572		$	-			$	24,572
Parts sales		6,494			-				6,494
Service revenue		8,286			-				8,286
Rental Revenue		5,858			(34	)	(2)		5,824
Net revenue		45,210			(34	)			45,176
Cost of revenues:
New, used and rental equipment sales		21,715			-				21,715
Parts sales		3,740			-				3,740
Service revenue		2,039			-				2,039
Rental revenue		599			(6	)	(2)		593
Rental depreciation		3,460			(40	)	(2)		3,420
Cost of revenue		31,553			(46	)			31,507
Gross profit		13,657			12				13,669
General and administrative expenses		12,364			72		(2)		12,496
					60		(4)
Depreciation expense		147			-				147
Total general and administrative expenses		12,511			132				12,643
Income from operations		1,146			(120	)			1,026
Other income (expense)		(626	)		85		(2)		(280	)
Interest income (expense)		-			261		(3)		-
Other income		443			-				443
Total other expense		(183	)		346				163
Provision for income taxes		-			-				-
Net income	$	963		$	226			$	1,189

(1) Reflects reclassifications for balances and transactions presented in historical financial statements of NITCO included within the audited pro forma condensed financial information have been reclassified to conform to the presentation of financial statements of Alta as indicated in the table below.

	As per Financial Statements		Reclassifications			NITCO Total
Revenues:
New/allied revenue	$	22,036	$	(22,036	)	$	—
Used revenue		6,019		(6,019	)		—
New, used and rental equipment sales		—		24,572			24,572
Rental revenue		2,875		2,983			5,858
Cost of revenues:
New/allied revenue		18,325		(18,325	)		—
Used revenue		3,390		(3,390	)		—
New, used and rental equipment sales		—		21,715			21,715
Rental revenue		2,820		(2,221	)		599
Rental depreciation		—		3,460			3,460
General and administrative expenses:
General and administrative expenses:		13,750		(1,386	)		12,364
Depreciation expense		—		147			147

(2) Reflects adjustments for rental income and costs associated with real estate property that was not acquired as a part of the Alta transaction. Additionally, these pro-forma adjustments are related to the premiums paid for a life insurance policy and interest expense on a loan to a stockholder neither of which were acquired as part of the transaction; as well as the inclusion of rent expense for the lease of the Northland facility from the previous owners that was entered into upon consummation of the transaction. As such, the historical financials are adjusted for the related impact.

(3) Reflects an adjustment to interest expense resulting from the interest on the new debt to partially finance the acquisition of NITCO. The adjustment was calculated by adding the $281K additional interest expense that would be recognized on the new debt, less the $542K of interest expense associated with the debt that was paid down as part of the refinance, for a net total $261K reduction in interest expense. As this is variable rate debt with an interest rate of LIBOR + an applicable margin, a 1/8 change in the interest rate would result in a change of $35K of interest expense being recognized.

(4) Reflects the amortization expense recorded for the intangible assets that were identified as part of the preliminary purchase price allocation. This adjustment reflects four months of amortization expense, as the Statement of Operations for the nine months ended September 20, 2019 already includes amortization expense from the acquisition date of May 1, 2019 to September 30, 2019.

16

(h) Pro-forma statement of operations adjustments of Liftech

	Liftech
	Liftech							Liftech
(Amounts in thousands, except for per share information)	Reclassified (1)			Pro Forma				Pro Forma (3)
Revenues:
New, used and rental equipment sales	$	14,628			-			$	14,628
Parts sales		6,463			-				6,463
Service revenue		8,356			-				8,356
Rental Revenue		2,309			-				2,309
Net revenue		31,756			-				31,756
Cost of revenues:
New, used and rental equipment sales		12,991			-				12,991
Parts sales		4,380			-				4,380
Service revenue		2,898			-				2,898
Rental revenue		75			-				75
Rental depreciation		858			-				858
Cost of revenue		21,202			-				21,202
Gross profit		10,554			-				10,554
General and administrative expenses		9,538			(58	)	(5)		9,480
					(42	)	(3)		(42	)
Depreciation expense		310			-				310
Total general and administrative expenses		9,848			(100	)			9,748
Income from operations		706			100				806
Other income (expense)		(631	)		32		(2)		(599	)
Interest income (expense)		-			430		(4)		430
									-
Other income		251			-				251
Total other expense		(380	)		462				82
Provision for income taxes		-			-				-
Net income		326			562				888

(1) Reflects adjustments for balances and transactions presented in historical financial statements of Liftech included within the unaudited pro forma condensed financial information have been re-classified to conform to the presentation of financial statements of Alta Equipment Holdings, Inc., as indicated in the table below:

	As per Financial Statements		Reclassifications			As reclassified
Revenues:
Net sales of tangible  products	$	21,091	$	(21,091	)	$	—
New, used and rental equipment sales		—		14,628			14,628
Parts sales				6,463			6,463
Cost of revenues:
Cost of tangible  products		17,370		(17,370	)		—
New, used and rental equipment sales				12,991			12,991
Parts sales				4,380			4,380
Rental revenue		933		(858	)		75
Rental depreciation		—		858			858

17

	As per Financial Statements		Reclassifications			As reclassified
General and administrative expenses:
Employee salaries and benefits		6,678		(6,678	)		—
Other operating expenses		3,170		(3,170	)		—
General and administrative expenses		—		9,538			9,538
Depreciation expense		—		310			310

(2) Reflects adjustments for the removal of the interest expense recognized from the amortization of debt issuance costs related to debt not assumed as part of the transaction.

(3) Reflects adjustments for the removal of the amortization expense recognized related to intangible assets written off as a part of the acquisition.

(4) Reflects the adjustments for the removal of interest expense related to outstanding indebtedness not assumed by Alta upon consummation of the acquisition.

(5) Reflects adjustments for the captive premiums receivable and cash surrender value of life insurance that were not acquired as part of the acquisition. As such, the historical financials are adjusted for the related impact.

(i) Pro-forma statement of operations adjustments of Flagler

	Flagler
	Flagler							Flagler
(Amounts in thousands, except for per share information)	Reclassified (1)			Pro Forma				Pro forma (4)
Revenues:
New, used and rental equipment sales	$	91,840		$	-			$	91,840
Parts sales		22,182			-				22,182
Service revenue		12,361			-				12,361
Rental Revenue		13,377			-				13,377
Net revenue		139,760			-				139,760
Cost of revenues:
New, used and rental equipment sales		83,876			-				83,876
Parts sales		16,012			-				16,012
Service revenue		6,241			-				6,241
Rental revenue		1,516			-				1,516
Rental depreciation		8,879			-				8,879
Cost of revenue		116,524			-				116,524
Gross profit		23,236			-				23,236
General and administrative expenses		20,665			(50	)	(3)		20,615
Depreciation expense		691			-				691
Total general and administrative expenses		21,356			(50	)			21,306
Income from operations		1,880			50				1,930
Other income (expense)		-			-				-
Interest income (expense)		(3,883	)		2,351		(2)		(1,532	)
Other income		402			-				402
Other expense		-			-				-
Gain on sale of assets		218			(218	)	(3)		0
Change in fair market value of warrants		-			-				-
Total other expense		(3,263	)		2,133				(1,130	)
Provision for income taxes		-			-				-
Net income	$	(1,383	)	$	2,183			$	800

(1) Reflects adjustments for balances and transactions presented in historical financial statements of Flagler included within the unaudited pro forma condensed financial information have been re-classified to conform to the presentation of financial statements of Alta Equipment Holdings, Inc., as indicated in the table below:

18

	As per Financial Statements		Reclassifications			As reclassified
Revenues:
Equipment and parts sales	$	114,022	$	(114,022	)	$	—
New and used equipment sales		—		91,840			91,840
Parts sales		—		22,182			22,182
Equipment and parts sales		99,888		(99,888	)		—
New and used equipment sales		—		83,876			83,876
Parts sales		—		16,012			16,012
Rental revenue		10,395		(8,879	)		1,516
Rental depreciation		—		8,879			8,879
General and administrative expenses:
General and administrative expenses		21,356		(691	)		20,665
Depreciation expense		—		691			691

(2) Reflects adjustments for the removal of interest expense recognized related to outstanding indebtedness not assumed as part of the Alta acquisition.

(3) Reflects adjustments for the cash surrender value of life insurance and the gain on the sale of assets not acquired as part of the Business Combination. As such, the historical financials are adjusted for the related impact.

19

Note 4 — Reclassifications and Adjustments to Historical Information of Alta Equipment Holdings, Inc. for the year ended December 31, 2018

(a) The following table provides the pro forma statement of operations of Alta for the year ended December 31, 2018 as if NITCO, Liftech and Flagler had been acquired on January 1, 2018. NITCO was acquired by Alta effective May 1, 2019. Liftech and Flagler were acquired on February 14, 2020. The pro forma results do not include any anticipated cost synergies, removal of historic non- recurring or discretionary items or other effects of the integration of these entities into Alta.

ALTA EQUIPMENT HOLDINGS, INC. PRO FORMA FINANCIAL STATEMENT
OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2018

	Alta Equipment Holdings, Inc.										NITCO			Liftech			Flagler			Alta Equipment Holdings, Inc. Pro
								Alta Pro			Pro			Pro			Pro			Forma
	Balance			Pro Forma				Forma (a)			Forma (b)			Forma (c)			Forma (d)			Combined
Revenues:
New, used and rental equipment sales	$	216,035		$	-			$	216,035		$	75,442		$	23,086		$	85,002		$	399,565
Parts sales		61,341			-				61,341			19,095			8,302			30,862			119,600
Service revenue		61,563			-				61,563			23,388			10,459			17,250			112,660
Rental Revenue		74,446			-				74,446			7,925			3,156			14,006			99,533
Net revenue		413,385			-				413,385			125,850			45,003			147,120			731,358
Cost of revenues:
New, used and rental equipment sales		188,557			-				188,557			58,119			20,884			76,185			343,745
Parts sales		40,602			-				40,602			10,594			5,487			23,296			79,979
Service revenue		24,185			-				24,185			3,543			3,664			7,064			38,456
Rental revenue		15,107			-				15,107			1,534			98			786			17,525
Rental depreciation		34,256			-				34,256			10,544			1,100			10,949			56,849
Cost of revenue		302,707			-				302,707			84,334			31,233			118,280			536,554
Gross profit		110,678			-				110,678			41,516			13,770			28,840			194,804
General and administrative expenses		92,314			(28	)	(1)		92,286			38,002			12,326			20,952			163,566
Depreciation expense		2,029			-				2,029			424			475			2,094			5,022
Total general and administrative expenses		94,343			(28	)			94,315			38,426			12,801			23,046			168,588
Income from operations		16,335			28				16,363			3,090			969			5,794			26,216
Other income (expense)
Interest income (expense)		(15,131	)		(98	)	(2)		(18,125	)		(867	)		(155	)		(1,260	)		(20,407	)
					(2,896	)	(3)
Other income		1,220			-				1,220			903			125			-			2,248
Change in fair market value of warrants		(400	)		-				(400	)		-			-			-			(400	)
Total other expense		(14,311	)		(2,994	)			(17,305	)		36			(30	)		(1,260	)		(18,559	)
Provision for income taxes		-			-				-			-			-			-			-
Net income	$	2,024		$	(2,966	)		$	(942	)	$	3,126		$	939		$	4,534		$	7,657

20

(a) Refer to Note 4(b) for pro forma adjustments made to Alta.

(b) Refer to Note 4(c) for reclassification of NITCO historical information and pro forma adjustments.

(c) Refer to Note 4(d) for reclassification of Liftech historical information and pro forma adjustments.

(d) Refer to Note 4(e) for reclassification of Flagler historical information and pro forma adjustments.

(b) Pro-forma statement of operations adjustments of Alta

(1) Reflects adjustments made to eliminate non-recurring transaction costs previously recognized in the historical financial statements related to acquisitions and transactions completed prior to the Business Combination between the Company and Alta.

(2) Reflects an adjustment to amortization expense resulting from the increase in debt issuance costs associated with the Company’s May 1, 2019 increase in borrowing capacity to partially finance the acquisition of NITCO. The amortization expense above reflects twelve months of amortization expense.

(3) Reflects an adjustment to interest expense resulting from the interest on the increased borrowing capacities of debt to partially finance the acquisition of NITCO. The additional interest expense of $2.9 million recognized above reflects twelve months of interest expense on the increased borrowing capacities, as this is variable rate debt with interest rates of LIBOR + an applicable margin, a 1/8 change in the interest rate would result in a change of $408K of interest expense recognized.

21

(c) Pro-forma statement of operations adjustments of NITCO (12-months ended October 31, 2018)

	NITCO
	NITCO							NITCO Pro
	Reclassified (1)			Pro Forma				Forma (2)
Revenues:
New, used and rental equipment sales	$	75,442			-			$	75,442
Parts sales		19,095			-				19,095
Service revenue		23,388			-				23,388
Rental Revenue		8,036			(111	)	(2)		7,925
Net revenue		125,961			(111	)			125,850
Cost of revenues:
New, used and rental equipment sales		58,119			-				58,119
Parts sales		10,594			-				10,594
Service revenue		3,543			-				3,543
Rental revenue		1,537			(3	)	(2)		1,534
Rental depreciation		10,639			(95	)	(2)		10,544
Cost of revenue		84,432			(98	)			84,334
Gross profit		41,529			(13	)			41,516
General and administrative expenses		37,580			243		(2)		38,002
		-			(1	)	(3)
		-			180		(5)
Depreciation expense		424			-				424
Total general and administrative expenses		38,004			422				38,426
Income from operations		3,525			(435	)			3,090
Other income (expense)		-			-				-
Interest income (expense)		(1,824	)		175		(2)		(867	)
					782		(4)
Other income		903			-				903
Total other expense		(921	)		957				36
Provision for income taxes		-			-				-
Net income	$	2,604		$	522			$	3,126

(1) Reflects reclassifications for balances and transactions presented in historical financial statements of NITCO included within the audited pro forma condensed financial information have been reclassified to conform to the presentation of financial statements of Alta, as indicated in the table below.

	As per Financial Statements		Reclassifications			NITCO Total
Revenues:
New/allied revenue	$	62,649	$	(62,649	)	$	—
Used revenue		12,793		(12,793	)		—
New, used and rental equipment sales		—		75,442			75,442
Cost of revenues:
New/allied revenue		48,915		(48,915	)
Used revenue		9,204		(9,204	)
New, used and rental equipment sales				58,119			58,119
Rental revenue		8,207		(6,670	)		1,537
Rental depreciation		—		10,639			10,639
General and administrative expenses:
General and administrative expenses		41,973		(4,393	)		37,580
Depreciation expense				424			424

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(2) Reflects adjustments for rental income and costs associated with real estate property that was not acquired as a part of the Alta transaction. Additionally, these pro-forma adjustments remove the premiums paid for a life insurance policy and interest expense on a loan to a stockholder, neither of which were acquired as part of the transaction; plus, the adjustments reflect the inclusion of rent expense for the lease of the Northland facility from the previous owners that was entered into upon consummation of the transaction. As such, the historical financials are adjusted for the related impact.

(3) Reflects the removal of non-recurring legal charges, which were incurred as a direct result of the Alta transaction. As such, the historical financials are adjusted to remove the related impact.

(4) Reflects an adjustment to interest expense resulting from the interest on the new debt to finance the acquisition of NITCO. The adjustment was calculated by adding the $844K additional interest expense that would be recognized on the new debt, less the $1.62 million of interest expense associated with the debt that was paid down as part of the refinance. As this is variable rate debt, a 1/8 change in the interest rate would result in a change of $105K of interest expense being recognized.

(5) Reflects the amortization expense recorded for the intangible assets that were identified as part of the preliminary purchase price allocation.

(d) Pro forma statement of operations adjustments of Liftech

	Liftech
	Liftech							Liftech Pro
	Reclassified (1)			Pro Forma				Forma (3)
Revenues:
New, used and rental equipment sales	$	23,086			-			$	23,086
Parts sales		8,302			-				8,302
Service revenue		10,459			-				10,459
Rental Revenue		3,156			-				3,156
Net revenue		45,003			0				45,003
Cost of revenues:
New, used and rental equipment sales		20,884			-				20,884
Parts sales		5,487			-				5,487
Service revenue		3,664			-				3,664
Rental revenue		98			-				98
Rental depreciation		1,100			-				1,100
Cost of revenue		31,233			0				31,233
Gross profit		13,770			0				13,770
General and administrative expenses		12,169			214		(5)		12,326
		-			(58	)	(3)		-
Depreciation expense		475			-				475
Total general and administrative expenses		12,644			157				12,801
Income from operations		1,126			-157				969
Other income (expense)		-			-				-
Interest income (expense)		(837	)		11		(2)		(155	)
		-			671		(4)		-
Other income		125			-				125
Total other expense		(712	)		682				(30	)
Provision for income taxes		-			-				-
Net income	$	414		$	525			$	939

(1) Reflects reclassifications for balances and transactions presented in historical financial statements of Liftech included within the unaudited pro forma condensed financial information have been reclassified to conform to the presentation of financial statements of Alta Equipment Holdings, Inc., as indicated in the table below.

23

	As per Financial Statements		Reclassifications			As reclassified
Revenues:
Net sales of tangible products	$	31,388	$	(31,388	)	$	—
New, used and rental equipment sales		—		23,086			23,086
Parts sales		—		8,302			8,302
Cost of revenues:
Cost of tangible products		26,371		(26,371	)		—
New, used and rental equipment sales		—		20,884			20,884
Parts sales		—		5,487			5,487
Rental revenue		1,198.31		(1,100	)		98
Rental depreciation		—		1,100			1,100
General and administrative expenses:
Employee salaries and benefits		8,986		(8,986	)		—
Other operating expenses		3,658		(3,658	)		—
General and administrative expenses		—		12,169			12,169
Depreciation expense				475			475

(2) Reflects adjustments for the removal of the interest expense recognized from the amortization of debt issuance costs as the related debt was not assumed as part of the acquisition.

(3) Reflects adjustments for the removal of the amortization expense recognized related to intangible assets, as they were written off as a part of the acquisition.

(4) Reflects the adjustments for the removal of interest expense related to debt not assumed by Alta upon consummation of the acquisition.

(5) Reflects adjustments for the captive premiums receivable and cash surrender value of life insurance that were not acquired as part of the Business Combination. As such, the historical financials are adjusted for the related impact.

(e) Pro-forma statement of operations adjustments of Flagler

	Flagler
	Flagler							Flagler Pro
	Reclassified (1)			Pro Forma				Forma (4)
Revenues:
New, used and rental equipment sales	$	85,002			-			$	85,002
Parts sales		30,862			-				30,862
Service revenue		17,250			-				17,250
Rental Revenue		14,006			-				14,006
Net revenue		147,120			-				147,120
Cost of revenues:
New, used and rental equipment sales		76,185			-				76,185
Parts sales		23,296			-				23,296
Service revenue		7,064			-				7,064
Rental revenue		786			-				786
Rental depreciation		10,949			-				10,949
Cost of revenue		118,280			-				118,280
Gross profit		28,840			-				28,840
General and administrative expenses		21,053			(101	)	(3)		20,952
Depreciation expense		2,094			-				2,094
Total general and administrative expenses		23,147			(101	)			23,046
Income from operations		5,693			101				5,794
Other income (expense)		-			-				-
Interest income (expense)		(4,101	)		2,841		(2)		(1,260	)
Gain on sale of assets		290			(290	)	(3)		-
Change in fair market value of warrants		-			-				-
Total other expense		(3,811	)		2,551				(1,260	)
Provision for income taxes		-			-				-
Net income	$	1,882		$	2,652			$	4,534

24

(1) Reflects adjustments for balances and transactions presented in historical financial statements of Flagler included within the unaudited pro forma condensed financial information have been re-classified to conform to the presentation of financial statements of Alta Equipment Holdings, Inc., as indicated in the table below:

	As per Financial Statements		Reclassifications			As reclassified
Revenues:
Equipment and parts sales	$	115,864	$	(115,864	)	$	—
New and used equipment sales		—		85,002			85,002
Parts sales		—		30,862			30,862
Equipment and parts sales		99,481		(99,481	)		—
New and used equipment sales		—		76,185			76,185
Parts sales		—		23,296			23,296
Rental revenue		11,735		(10,949	)		786
Rental depreciation				10,949			10,949
General and administrative expenses:
General and administrative expenses		23,147		(2,094	)		21,053
Depreciation expense				2,094			2,094

(2) Reflects adjustments for the removal of interest expense recognized related to outstanding indebtedness that was not assumed as part of the Alta acquisition.

(3) Reflects adjustments for the cash surrender value of life insurance, deferred compensation expenses and the gain on the sale of assets that were not acquired as part of the acquisition. As such, the historical financials are adjusted for the related impact.

Note 5 — Pro Forma Adjustments

(a) Adjustments to the Unaudited Pro Forma Condensed Combined Balance Sheet as of September 30, 2019 (in thousands)

The pro forma adjustments included in the unaudited pro forma condensed combined balance sheet as of September 30, 2019 are as follows:

(1) Private Investment in Public Entity (PIPE) —Represents the issuance, in a private placement of equity, of 3,678,947, 3,500,000 shares of common stock and 178,947 inducement shares.

(2) Reflects proceeds from the forward purchase agreement entered into by the Company with the BRPI to provide for the purchase of up to an aggregate of 2,500,000 units at $10.00 per unit for an aggregate purchase price of $25 million. These proceeds from the sale of the forward purchase units were used as part of the consideration to the holders to pay expenses in connection with the Business Combination and will be used for working capital in the post-business combination company, and was intended to provide the Company with a minimum funding level for the Business Combination.

(3) Reflects the release of the restricted investments and cash held in the Trust Account upon consummation of the Business Combination. Approximately $10.3 million was redeemed by shareholders.

25

(4) Reflects the pay down of the Company’s existing indebtedness as it relates to the revolving line of credit, the syndicate and OEM floor plan facilities, the note payable with the senior lien holder, the term loan with the first lien lender, the subordinated debt, and settlement of the Company’s outstanding warrant liability. These pay downs are off-set by showroom ready and subsidized debt, unamortized debt issuance costs and debt discounts on the existing debt, as well as original issue discounts and fees on the new term loan entered into as part of the refinance. This is reflected in the table below:

Lines of credit and floor plan debt refinance adjustment	Amount
Total debt paydown of Syndicate floor plan, OEM floor plan facilities and Chase Revolver	$	(198,789	)
Proceeds from new revolver facility		115,000
Off-set by debt issuance costs		(1,667	)
Lines of credit and floor plans adjustment	$	(85,457	)
Long-term debt, net of current portion adjustment	Amount
Debt paydown from senior lien holder, subordinated debt and the first lien lender	$	(77,684	)
Less: unamortized debt issuance costs		3,138
Less: Unamortized debt discount		905
Net reduction of existing debt	$	(73,640	)
Proceeds from LT portion of new revolver facility		126,818
Off-set by debt discount and fees on new term loan		(5,638	)
Net proceeds from long-term portion of new revolver facility		121,181
Net principal long-term portion of new revolver facility, net of current portion adjustment	$	47,540
Current portion of LT debt adjustment	Amount
Current portion of debt paydown from senior lien holder, subordinated debt and the first lien lender	$	(8,694	)
Proceeds from new term loan (b)		28,182
Total current portion of LT debt adjustment	$	19,488
Warrant liability adjustment	Amount
Settlement of Warrant liability (a)	$	(29,620	)
Total Cash impact of debt paydown	$	(52,092	)

a) Represents the fair value for the settlement of warrants issued to a senior lender. The company initially recorded the warrants based on the fair value at the date of grant. The valuation methodology employed was primarily a market-based approach using participants in the industry of industrial and heavy equipment retailing, wholesaling, and rental and consistent with those presented in the letter of intent with the Company. The warrants include a limited call right, where in the event of a sale transaction, the Company has the right to redeem all of the warrants simultaneously at a per common share price equal to the per unit set for the sale transaction. As of September 30, 2019, the Company determined the fair value of the warrants in the proposed transaction with the Company to be $30 million.

b) Current portion of LT debt is calculated utilizing the new term loan maturity of 66 months to determine the expected amount due within the next 12 months. Additionally, there is a 5% prepayment penalty on the outstanding balance of the Goldman debt (approximately $3.5M), which is reflected in the pay down of debt.

(5) Reflects the payment of the estimated acquisition-related transaction costs (seeNote 1 — Use of proceeds). These costs are not included as a component of consideration to be transferred, but are required to be expensed as incurred. The unaudited pro forma condensed combined balance sheet reflects these costs as a reduction of cash, with a corresponding decrease in retained earnings. These costs are not included in the unaudited pro forma condensed combined statement of operations as they are directly related to the Business Combination and will be nonrecurring.

26

(6) Represents the payout and re-investment of the awards associated with the Long-Term Equity Linked Incentive Plan to certain members of Alta’s management and a stock redemption payment to Alta’s stockholder. These awards fully vest upon a qualifying event (i.e. a change in control of the Company), which was recognized upon closing of the Business Combination. The awards are expected to be settled by a 25% cash payout, 25% in restricted stock awards (RSA’s) and 50% in restricted stock units (RSU’s) vesting over a four-year period. The $13 million cash payment will be reflected as an expense to the Company’s operations in the period immediately following the consummation of the Business Combination. Additionally, there is expected to be stock based compensation expense recognized over the four-year vesting period of the RSA’s and RSU’s totaling $8.64 million in the Company’s operations post-Business Combination.

(7) Reflects the total expected cost associated with the acquisition of Liftech and Flagler.

(8) Reflects adjustments made for applicable deferred taxes associated with the Business Combination. The deferred tax liability was calculated using an assumed marginal rate of 26.63%, based on Alta Enterprises, LLC 2018 federal and state filing profile.

(b) Adjustments to the Unaudited Pro Forma Condensed Combined Statements of Operations for the nine months ended September 30, 2019

The pro forma adjustments included in the unaudited pro forma condensed combined statement of operations for the nine month period ended September 30, 2019 are as follows:

(1) Reflects adjustments made to eliminate non-recurring transaction costs specifically incurred by the Company and Alta as part of the Business Combination as these expenses meet the directly attributable and factually supportable criteria.

(2) Reflects the adjustment to interest expense associated with the pay down and refinancing of the Company’s existing indebtedness upon consummation of the Business Combination (see note 4 under 5(a)). The decreased interest expense of $1.6 million reflects nine months of interest expense on the new revolver and term loan less the interest expense associated with the debt paid down (net of showroom ready and subsidized debt), as well as the amortization of debt issuance costs and debt discounts. As the Company drew down $115 million of their $300 million available revolver, total borrowing availability at close was $185 million. The revolver credit agreement states that interest expense is calculated for average quarterly availability greater than $100 million at LIBOR + 175 bps. As there is greater than $100 million of borrowing available, the interest expense was calculated utilizing the LIBOR rate as of January 31, 2020 + 175 bps.

The interest expense on the term loan (‘note purchase agreement’) is calculated by:7% plus CB floating rate or 8% plus the adjusted LIBOR rate (as selected by the Company). The pro forma rate below reflects the 8% plus the adjusted LIBOR rate. Therefore, interest expense on the new term loan was calculated utilizing the January 31, 2020 LIBOR rate + 8%.

The interest expense adjustment is reflected in the table below:

Interest expense adjustment for nine-months ended September 30, 2019	Amount
Interest expense on new debt	$	(14,171	)
Less: Interest expense from debt paydown, net of showroom ready and subsidized interest expense		16,043
Less: amortization of debt discounts on  costs		594
Less: amortization of debt discount		181
Amortization of original issue discounts on new loans		(740	)
Amortization of debt issuance costs on new loans		(279	)
Pro forma adjustment to Int. Exp.	$	1,629

As this is variable rate debt, a 1/8% increase or decrease in interest rates would result in a $1.7 million change in interest expense recognized.

(3) Reflects adjustments related to the addition of a tax provision as prior to the Business Combination, Alta was previously a limited liability corporation, which is generally not a tax paying entity for federal or state income tax purposes. The marginal tax rate used was based on the 2018 federal and state filing profile of Alta Enterprises, LLC. The pro forma calculation assumes an effective rate equal to the marginal tax rate.

(4) Reflects pro forma net loss per share based on 29,511,359 total shares outstanding upon consummation of the Business Combination.

27

(c) Adjustments to the Unaudited Pro Forma Condensed Combined Statements of Operations for the twelve months ended December 31, 2018

The pro forma adjustments included in the unaudited pro forma condensed combined statement of operations for the fiscal year ended December 31, 2018 are as follows:

(1) Reflects adjustments made to eliminate non-recurring transaction costs specifically incurred by the Company and Alta as part of the Business Combination as these expenses meet the directly attributable and factually supportable criteria.

(2) Reflects the adjustment to interest expense associated with the pay down and refinancing of the Company’s existing indebtedness upon consummation of the Business Combination (see note 4 under 5(a)). The increased interest expense of $646K reflects twelve months of interest expense on the new revolver and term loan less the interest expense associated with the debt paid down (net of floor plan ready/subsidized debt not paid down), as well as the amortization of debt issuance costs and debt discounts. As the Company drew down $115 million of the $300 million available revolver, total borrowing availability at close was $185 million. The revolver credit agreement states that interest expense is calculated for average quarterly availability greater than $100 million at LIBOR + 175 bps. As there is greater than $100 million of borrowing available, the interest expense was calculated utilizing the LIBOR rate as of January 31, 2020 + 175 bps.

The interest expense on the term loan (‘note purchase agreement’) is calculated by:7% plus CB floating rate or 8% plus the adjusted LIBOR rate (as selected by the Company). The pro forma rate below reflects the 8% plus the adjusted LIBOR rate. Therefore, interest expense on the new term loan was calculated utilizing the January 31, 2020 LIBOR rate + 8%.

(3) The interest expense adjustment is reflected in the table below:

Interest expense adjustment for the year-ended December 31, 2018	Amount
Interest expense on new debt	$	(18,895	)
Less: Interest expense from debt paydown, net of showroom ready and subsidized interest expense		18,608
Less: amortization of debt issuance costs		757
Less: amortization of debt discount		241
Amortization of original issue discounts on new loans		(986	)
Amortization of debt issuance costs on new loan		(372	)
Pro forma adjustment to Int. Exp.	$	(646	)

As this is variable rate debt, a 1/8% increase or decrease in interest rates would result in a $2.4 million change in interest expense.

(4) Reflects adjustments related to the addition of a tax provision as prior to the Business Combination, Alta was previously a limited liability corporation, which is generally not a tax paying entity for federal or state income tax purposes. The marginal tax rate used was based on the 2018 federal and state filing profile of Alta Enterprises, LLC. The pro forma calculation assumes an effective rate equal to the marginal tax rate.

(5) Reflects pro forma net loss per share based on 29,511,359 total shares outstanding upon consummation of the Business Combination.

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