Exhibit 99.3
AULT ALLIANCE, INC. AND SUBSIDIARIES
Unaudited Pro Forma Condensed Combined Financial Statements
The unaudited pro forma condensed combined financial statements (the “Pro Forma Statements”) presented below are derived from the historical consolidated financial statements of Ault Alliance, Inc. (previously “BitNile Holdings Inc.”) (“Ault” or the “Company”) and the results of Circle 8 Crane Services LLC.
The Pro Forma Statements are prepared as a business combination reflecting Ault’s acquisition of Circle 8 Crane Services LLC (the “Acquisition”) as if the Acquisition had been completed on January 1, 2021 for statement of income purposes and on September 30, 2022 for balance sheet purposes. The Pro Forma Statements do not give effect to the realization of any expected cost savings or other synergies from the Acquisition as a result of restructuring activities or other cost savings initiatives.
The Pro Forma Statements have been developed from (a) the audited consolidated financial statements of Ault contained in its Annual Report on Form 10-K for the year ended December 31, 2021 and the unaudited consolidated financial statements of Ault contained in its Quarterly Report on Form 10-Q for the nine months ended September 30, 2022, and (b) the audited financial statements of Circle 8 Crane Services LLC for the year ended December 31, 2021 and the unaudited financial statements of Circle 8 Crane Services LLC for the nine months ended September 30, 2022, both of which are contained in this Current Report on Form 8-K. Historical results of Circle 8 Crane Services LLC have been adjusted to reclassify certain amounts to conform to Ault’s presentation.
The Pro Forma Statements have been prepared to reflect adjustments to Ault’s historical consolidated financial information that are (i) directly attributable to the Acquisition, (ii) factually supportable and (iii) with respect to the unaudited pro forma condensed combined statement of income, expected to have a continuing impact on the Company’s results.
The acquired assets of Circle 8 Crane Services LLC were recorded at their respective fair values as of the closing date of the Acquisition, December 19, 2022. The values of Circle 8 Crane Services LLC’s assets and liabilities are based on preliminary valuations, as allowed by U.S. generally accepted accounting principles, and are subject to adjustment as additional information is obtained. The Company cannot provide any assurance that such adjustments will not result in a material change.
The Pro Forma Statements are provided for illustrative purposes only and do not purport to represent what the actual combined results of operations or the combined financial position of Ault would have been had the Acquisition occurred on the dates assumed, nor are they necessarily indicative of future consolidated results of operations or consolidated financial position.
The Pro Forma Statements should be read in conjunction with the separate historical consolidated financial statements and accompanying notes of Ault and the historical financial statements and accompanying notes of Circle 8 Crane Services LLC.
F-1 |
AULT ALLIANCE, INC. AND SUBSIDIARIES
UNAUDITED PROFORMA CONDENSED COMBINED BALANCE SHEET
AS OF SEPTEMBER 30, 2022
Historical | Pro Forma | ||||||||||||||||
Ault | Circle 8 crane services LLC | Adjustments | Combined | ||||||||||||||
ASSETS | |||||||||||||||||
CURRENT ASSETS | |||||||||||||||||
Cash and cash equivalents | $ | 10,126,000 | $ | 1,236,000 | $ | (12,944,000 | ) | (a) | $ | (1,582,000 | ) | ||||||
Restricted cash | 4,617,000 | - | - | 4,617,000 | |||||||||||||
Marketable equity securities | 8,561,000 | - | - | 8,561,000 | |||||||||||||
Accounts receivable | 19,234,000 | 5,722,000 | (1,389,000 | ) | (b) | 23,567,000 | |||||||||||
Investment in promissory notes and other, related party | 2,818,000 | - | - | 2,818,000 | |||||||||||||
Digital currencies | 2,092,000 | - | - | 2,092,000 | |||||||||||||
Accrued revenue | 2,474,000 | - | - | 2,474,000 | |||||||||||||
Inventories | 28,848,000 | 24,000 | - | 28,872,000 | |||||||||||||
Loans receivable, current | 6,861,000 | - | - | 6,861,000 | |||||||||||||
Prepaid expenses and other current assets | 14,441,000 | 1,185,000 | - | 15,626,000 | |||||||||||||
TOTAL CURRENT ASSETS | 100,072,000 | 8,167,000 | (14,333,000 | ) | 93,906,000 | ||||||||||||
Intangible assets, net | 14,095,000 | - | - | 14,095,000 | |||||||||||||
Cash and marketable securities held in trust account | 117,421,000 | - | - | 117,421,000 | |||||||||||||
Property and equipment and rental equipment, net | 253,984,000 | 36,491,000 | (96,000 | ) | (c) | 290,379,000 | |||||||||||
Right-of-use assets | 7,404,000 | - | 437,000 | (d) | 7,841,000 | ||||||||||||
Goodwill | 54,544,000 | - | 407,000 | (h) | 56,699,000 | ||||||||||||
Tradenames | - | - | 2,280,000 | (o) | 2,280,000 | ||||||||||||
Customer relationships | - | - | 3,500,000 | (p) | 3,500,000 | ||||||||||||
Investments in common stock and warrants, related parties | 12,394,000 | - | - | 12,394,000 | |||||||||||||
Investments in other equity securities | 45,556,000 | - | - | 45,556,000 | |||||||||||||
Loans receivable, non-current | 500,000 | - | - | 500,000 | |||||||||||||
Other assets | 4,935,000 | 144,000 | (127,000 | ) | (e) | 4,952,000 | |||||||||||
TOTAL ASSETS | $ | 610,905,000 | $ | 44,802,000 | $ | (7,932,000 | ) | $ | 647,775,000 | ||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||
Accounts payable and accrued expenses | $ | 50,607,000 | $ | 3,728,000 | $ | (1,023,000 | ) | (g) | $ | 53,312,000 | |||||||
Operating lease liability, current | 2,825,000 | - | 268,000 | (d) | 3,093,000 | ||||||||||||
Mortgage payable, current | 86,000 | - | 86,000 | ||||||||||||||
Revolving credit facility | - | 25,267,000 | (11,637,000 | ) | (f) | 13,630,000 | |||||||||||
Equipment notes payable, current | - | 4.,210,000 | - | 4,210,000 | |||||||||||||
Notes payable, net | 17,132,000 | 11,354,000 | (11,354,000 | ) | (f) | 17,132,000 | |||||||||||
Convertible notes payable, current | 1,469,000 | - | - | 1,469,000 | |||||||||||||
Investment margin accounts payable | 2,377,000 | - | - | 2,377,000 | |||||||||||||
TOTAL CURRENT LIABILITIES | 74,410,000 | 44,645,000 | (23,746,000 | ) | 95,309,000 |
F-2 |
AULT ALLIANCE, INC. AND SUBSIDIARIES
UNAUDITED PROFORMA CONDENSED COMBINED BALANCE SHEET - CONTINUED
AS OF SEPTEMBER 30, 2022
Historical | Pro Forma | ||||||||||||||||
Ault | Circle 8 crane services LLC | Adjustments | Combined | ||||||||||||||
LONG TERM LIABILITIES | |||||||||||||||||
Operating lease liability, non-current | 4,980,000 | - | 169,000 | (d) | 5,149,000 | ||||||||||||
Notes payable | 58,310,000 | 7,410,000 | - | 65,720,000 | |||||||||||||
Deferred underwriting commissions of Ault Disruptive subsidiary | 3,450,000 | - | - | 3,450,000 | |||||||||||||
Mortgage payable, net of current portion | - | 1,662,000 | (1,662,000 | ) | (f) | ||||||||||||
Convertible notes payable | 13,878,000 | - | - | 13,878,000 | |||||||||||||
TOTAL LIABILITIES | 155,028,000 | 53,717,000 | (25,239,000 | ) | 183,506,000 | ||||||||||||
COMMITMENTS AND CONTINGENCIES | |||||||||||||||||
Redeemable noncontrolling interest in equity of subsidiary | 117,114,000 | - | - | 117,114,000 | |||||||||||||
STOCKHOLDERS’ EQUITY | |||||||||||||||||
Class A Common Stock, $0.001 par value – 500,000,000 shares authorized; 341,446,982 shares issued and outstanding | 341,000 | 150,000 | (150,000 | ) | 341,000 | ||||||||||||
Class B Common Stock, $0.001 par value – 25,000,000 shares authorized; nil shares issued and outstanding at September 30, 2022 | - | 100,000 | (100,000 | ) | - | ||||||||||||
Additional paid-in capital | 557,418,000 | - | - | 557,418,000 | |||||||||||||
Members’ deficit | - | (9,165,000 | ) | 9,165,000 | (j) | - | |||||||||||
Accumulated deficit | (207,647,000 | ) | - | (608,000 | ) | (i) | (208,255,000 | ) | |||||||||
Accumulated other comprehensive loss | (1,557,000 | ) | - | - | (1,557,000 | ) | |||||||||||
Treasury stock, at cost | (28,788,000 | ) | - | - | (28,788,000 | ) | |||||||||||
TOTAL AULT ALLIANCE STOCKHOLDERS’ EQUITY (DEFICIT) | 319,767,000 | (8,915,000 | ) | 8,307,000 | 319,159,000 | ||||||||||||
Non-controlling interest | 18,996,000 | - | 9,000,000 | 27,996,000 | |||||||||||||
TOTAL STOCKHOLDERS’ EQUITY (DEFICIT) | 338,763,000 | (8,915,000 | ) | 17,307,000 | 347,155,000 | ||||||||||||
TOTAL LIABILITIES, COMMITMENTS AND STOCKHOLDERS’ EQUITY | $ | 610,905,000 | $ | 44,802,000 | $ | (7,932,000 | ) | $ | 647,775,000 |
F-3 |
AULT ALLIANCE, INC. AND SUBSIDIARIES
UNAUDITED PROFORMA CONDENSED COMBINED STATEMENTS OF INCOME AND
COMPREHENSIVE LOSS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2022
Historical | Pro Forma | ||||||||||||||||
Ault | Circle 8 crane services LLC | Adjustments | Combined | ||||||||||||||
Revenue | $ | 43,539,000 | $ | 32,385,000 | $ | - | $ | 75,924,000 | |||||||||
Revenue, hotels | 12,809,000 | - | - | 12,809,000 | |||||||||||||
Revenue, cryptocurrency mining | 11,398,000 | - | - | 11,398,000 | |||||||||||||
Revenue, lending activities | 32,224,000 | - | - | 32,224,000 | |||||||||||||
Total revenue | 99,970,000 | 32,385,000 | - | 132,355,000 | |||||||||||||
Cost of revenue | 51,541,000 | 22,126,000 | (3,161,000 | ) | (k) | 70,506,000 | |||||||||||
Gross profit | 48,429,000 | 10,259,000 | 3,161,000 | 61,849,000 | |||||||||||||
Operating expenses | |||||||||||||||||
Research and development | 1,945,000 | - | - | 1,945,000 | |||||||||||||
Selling and marketing | 20,888,000 | 2,360,000 | - | 23,248,000 | |||||||||||||
General and administrative | 53,596,000 | 4,984,000 | 867,000 | (n) | 58,580,000 | ||||||||||||
Total operating expenses | 76,429,000 | 7,344,000 | 867,000 | 83,773,000 | |||||||||||||
(Loss) income from continuing operations | (28,000,000 | ) | 2,915,000 | 2,294,000 | (21,924,000 | ) | |||||||||||
Other income (expenses) | |||||||||||||||||
Interest and loss on sale of equipment | 1,255,000 | (345,000 | ) | - | 910,000 | ||||||||||||
PPP loan forgiveness | - | 2,000,000 | - | 2,000,000 | |||||||||||||
Loss from investment in unconsolidated entity | (924,000 | ) | - | - | (924,000 | ) | |||||||||||
Change in fair value of marketable equity securities | 355,000 | - | - | 355,000 | |||||||||||||
Realized gain on marketable securities | 661,000 | - | - | 661,000 | |||||||||||||
Interest expense | (35,827,000 | ) | (4,606,000 | ) | 3,541,000 | (l) | (36,892,000 | ) | |||||||||
Change in fair value of warrant liability | (27,000 | ) | - | - | (27,000 | ) | |||||||||||
Total other expenses, net | (34,507,000 | ) | (2,951,000 | ) | 3,541,000 | (33,917,000 | ) | ||||||||||
Loss from continuing operations before income taxes | (62,507,000 | ) | (36,000 | ) | 5,835,000 | (56,708,000 | ) | ||||||||||
Income tax provision | (361,000 | ) | - | (361,000 | ) | ||||||||||||
Net loss | (62,868,000 | ) | (36,000 | ) | 5,835,000 | (57,069,000 | ) | ||||||||||
Net loss (income) attributable to non-controlling interest | 1,061,000 | - | (2,559,000 | ) | (m) | (1,498,000 | ) | ||||||||||
Net loss | (61,807,000 | ) | (36,000 | ) | 3,276,000 | (58,567,000 | ) | ||||||||||
Preferred dividends | (239,000 | ) | - | (239,000 | ) | ||||||||||||
Net loss available to common stockholders | $ | (62,046,000 | ) | $ | (36,000 | ) | $ | 3,276,000 | $ | (58,806,000 | ) | ||||||
Basic and diluted net loss per common share: | |||||||||||||||||
Net loss per common share - basic | $ | (0.27 | ) | $ | - | $ | - | $ | (0.26 | ) | |||||||
Net loss per common share - diluted | $ | (0.27 | ) | $ | - | $ | - | $ | (0.26 | ) | |||||||
Weighted average basic common shares outstanding | 225,662,000 | - | - | 225,662,000 | |||||||||||||
Weighted average diluted common shares outstanding | 225,662,000 | - | - | 225,662,000 | |||||||||||||
Comprehensive loss | |||||||||||||||||
Loss available to common stockholders | $ | (62,046,000 | ) | $ | (36,000 | ) | $ | 3,276,000 | $ | (58,806,000 | ) | ||||||
Other comprehensive loss | |||||||||||||||||
Foreign currency translation adjustment | (1,452,000 | ) | - | - | (1,452,000 | ) | |||||||||||
Other comprehensive loss | (1,452,000 | ) | - | - | (1,452,000 | ) | |||||||||||
Total comprehensive loss | $ | (63,498,000 | ) | $ | (36,000 | ) | $ | 3,276,000 | $ | (60,258,000 | ) |
F-4 |
AULT ALLIANCE, INC. AND SUBSIDIARIES
UNAUDITED PROFORMA CONDENSED COMBINED STATEMENTS OF INCOME AND
COMPREHENSIVE LOSS
FOR THE YEAR ENDED DECEMBER 31, 2021
Historical | Pro Forma | ||||||||||||||||
Ault | Circle 8 crane services LLC | Adjustments | Combined | ||||||||||||||
Revenue | $ | 32,096,000 | $ | 35,010,000 | $ | - | $ | 67,106,000 | |||||||||
Revenue, cryptocurrency mining | 3,450,000 | - | - | 3,450,000 | |||||||||||||
Revenue, lending activities | 16,854,000 | - | - | 16,854,000 | |||||||||||||
Total revenue | 52,400,000 | 35,010,000 | - | 87,410,000 | |||||||||||||
Cost of revenue | 23,858,000 | 29,960,000 | (5,964,000 | ) | (k) | 47,854,000 | |||||||||||
Gross profit | 28,542,000 | 5,050,000 | 5,964,000 | 39,556,000 | |||||||||||||
Operating expenses | |||||||||||||||||
Research and development | 2,041,000 | - | - | 2,041,000 | |||||||||||||
Selling and marketing | 7,773,000 | 3,008,000 | - | 10,781,000 | |||||||||||||
General and administrative | 36,686,000 | 5,355,000 | 1,156,000 | (n) | 43,197,000 | ||||||||||||
Impairment of mined cryptocurrency | 403,000 | - | - | 403,000 | |||||||||||||
Total operating expenses | 46,903,000 | 8,363,000 | 1,156,000 | 56,422,000 | |||||||||||||
Loss from continuing operations | (18,361,000 | ) | (3,313,000 | ) | 4,808,000 | (16,866,000 | ) | ||||||||||
Other income (expenses) | |||||||||||||||||
Interest and other income | 808,000 | 77,000 | - | 885,000 | |||||||||||||
Interest expense | (1,871,000 | ) | (6,980,000 | ) | 4,126,000 | (l) | (4,725,000 | ) | |||||||||
Change in fair value of marketable equity securities | (1,327,000 | ) | - | - | (1,327,000 | ) | |||||||||||
Employee retention credit and PPP loan forgiveness | - | 7,748,000 | - | 7,748,000 | |||||||||||||
Gain on sale of equipment | - | 212,000 | - | 212,000 | |||||||||||||
Realized gain on marketable securities | 1,924,000 | - | - | 1,924,000 | |||||||||||||
Loss from equity investment | (311,000 | ) | - | - | (311,000 | ) | |||||||||||
Gain on extinguishment of debt | 929,000 | - | - | 929,000 | |||||||||||||
Change in fair value of warrant liability | (542,000 | ) | - | - | (542,000 | ) | |||||||||||
Total other (expenses) income, net | (5,480,000 | ) | 1,057,000 | 4,126,000 | (297,000 | ) | |||||||||||
Loss from continuing operations before income taxes | (23,841,000 | ) | (2,256,000 | ) | 8,934,000 | (17,163,000 | ) | ||||||||||
Income tax provision | (130,000 | ) | - | - | (130,000 | ) | |||||||||||
Net loss | (23,971,000 | ) | (2,256,000 | ) | 8,934,000 | (17,293,000 | ) | ||||||||||
Net income attributable to non-controlling interest | (213,000 | ) | - | (2,947,000 | ) | (m) | (3,160,000 | ) | |||||||||
Net loss | (24,184,000 | ) | (2,256,000 | ) | 5,987,000 | (20,453,000 | ) | ||||||||||
Preferred dividends | (18,000 | ) | - | (18,000 | ) | ||||||||||||
Net loss available to common stockholders | $ | (24,202,000 | ) | $ | (2,256,000 | ) | $ | 5,987,000 | $ | (20,471,000 | ) | ||||||
Basic and diluted net income (loss) per common share: | |||||||||||||||||
Net loss per common share - basic | $ | (0.44 | ) | $ | - | $ | - | $ | (0.37 | ) | |||||||
Net loss per common share - diluted | $ | (0.44 | ) | $ | - | $ | - | $ | (0.37 | ) | |||||||
Weighted average common shares outstanding, basic and diluted | 55,444,000 | - | - | 55,444,000 | |||||||||||||
Comprehensive loss | |||||||||||||||||
Loss available to common stockholders | $ | (24,202,000 | ) | $ | (2,256,000 | ) | $ | 5,987,000 | $ | (20,471,000 | ) | ||||||
Other comprehensive income | |||||||||||||||||
Foreign currency translation adjustment | 85,000 | - | - | 85,000 | |||||||||||||
Impairment of debt securities | 9,300,000 | - | - | 9,300,000 | |||||||||||||
Net unrealized gain on derivative securities of related party | (7,773,000 | ) | - | - | (7,773,000 | ) | |||||||||||
Other comprehensive income | 1,612,000 | - | 1,612,000 | ||||||||||||||
Total comprehensive loss | $ | (22,590,000 | ) | $ | (2,256,000 | ) | $ | 5,987,000 | $ | (18,859,000 | ) |
F-5 |
AULT ALLIANCE, INC. AND SUBSIDIARIES
Notes to Unaudited Pro Forma Condensed Combined Financial Statements
Note 1. Basis of Presentation
The accompanying Unaudited Pro Forma Condensed Combined Financial Statements (the “Pro Forma Statements”) present the pro forma combined financial position and results of operations of the combined company based upon the historical consolidated financial statements of Ault and the financial statements of Circle 8 Crane Services LLC, after giving effect to the Acquisition and adjustments described in these footnotes, and are intended to reflect the impact of the Acquisition on Ault.
As previously reported in the Current Report on Form 8-K filed by the Company on November 18, 2022, Circle 8 Newco LLC, a Delaware limited liability company (“Circle 8 Newco”), entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”) with Circle 8 Crane Services LLC, a Delaware limited liability company (“Circle 8 Crane Services”) pursuant to which Circle 8 Newco agreed to purchase substantially all of the assets (the “Acquired Assets”) and assume certain specified liabilities of Circle 8 Crane Services (the “Circle 8 Transaction”). Circle 8 Newco is a wholly owned subsidiary of Circle 8 Holdco LLC, a Delaware limited liability company (“Circle 8 Holdco”). Circle 8 Holdco is a subsidiary of the Company. Ault Alliance owns a controlling interest in Circle 8 Holdco.
On December 19, 2022, the transaction closed and Circle 8 Newco purchased the Acquired Assets. As consideration for the acquisition of the Acquired Assets, Circle 8 Crane Services received Class D equity interests in Circle 8 Holdco and is eligible to receive cash earnout payments in an aggregate maximum amount of up to $2,100,000 based on the achievement by Circle 8 Newco of certain EBITDA targets over the three-year period following the completion of the acquisition of the Acquired Assets by Circle 8 Newco. The Company contributed $12 million to Circle 8 Newco, and an independent third party contributed $4 million, of which approximately $11,650,000 of which was used to pay down a portion of the Circle 8 Crane Services’ senior debt facility at the closing, $3,000,000 of which was used to pay off Circle 8 Crane Services’ subordinated debt facility in full at the closing and $1,350,000 was used to pay the expenses of Circle 8 Newco and Circle 8 Crane Services. In addition, Circle 8 Newco assumed a new line of credit issued by Circle 8 Crane Services’ current senior lender. The noncash estimated fair value of the seller’s equity rollover is $5,000,000.
The accompanying Pro Forma Statements are presented for illustrative purposes only and do not give effect to any cost savings, revenue synergies or restructuring costs which may result from the integration of Ault’s and Circle 8 Crane Services LLC’s operations. The accompanying Pro Forma Statements have been adjusted to reflect adjustments to Ault’s historical consolidated financial information that are (i) directly attributable to the Acquisition, (ii) factually supportable and (iii) to reclassify certain Circle 8 Crane Services LLC items to conform to Ault’s presentation. The Unaudited Pro Forma Combined Statements of Income reflect the Acquisition as if it had been completed on January 1, 2021. The Unaudited Pro Forma Condensed Combined Balance Sheet reflects the Acquisition as if it was completed on September 30, 2022.
F-6 |
Note 2. Preliminary Purchase Price Allocation
The Company has performed a preliminary valuation analysis of the fair market value of the assets acquired. The following table summarizes the preliminary allocation of the purchase price as of the date of the Acquisition. The purchase price consists of $20,392,000 cash payment.
Preliminary Allocation | ||||
Total purchase consideration | $ | 11,392,000 | ||
Fair value of non-controlling interest | 9,000,000 | |||
Total consideration | $ | 20,392,000 | ||
Identifiable net assets acquired: | ||||
Cash | $ | 292,000 | ||
Trade accounts receivable | 4,333,000 | |||
Inventories | 24,000 | |||
Prepaid expenses | 1,185,000 | |||
Property and equipment | 36,395,000 | |||
Right-of-use-asset | 437,000 | |||
Other long-term assets | 17,000 | |||
Intangible assets: | ||||
Tradename (5 year estimated life) | 2,280,000 | |||
Existing customer relationships (5 year estimated life) | 3,500,000 | |||
Accounts payable | (532,000 | ) | ||
Loans payable, net of discounts and issuance costs | (25,335,000 | ) | ||
Accrued payroll and benefits | (186,000 | ) | ||
Lease obligations | (437,000 | ) | ||
Accrued earnout | (1,132,000 | ) | ||
Other non-current liabilities | (855,000 | ) | ||
Net assets acquired | 19,985,000 | |||
Goodwill | $ | 407,000 |
The preliminary purchase price allocation has been used to prepare pro forma adjustments in the pro forma condensed combined statement of comprehensive income. The final purchase price allocation is subject to change as more detailed analyses are completed and additional information about the fair value of assets acquired becomes available.
Note 3. Pro Forma Adjustments
The pro forma adjustments are based on the Company’s preliminary estimates and assumptions that are subject to change. The following adjustments have been reflected in the unaudited pro forma condensed combined financial information:
a) | Cash contributed to the Acquisition of $11.4 million combined with pro forma adjustment required to adjust cash balance to cash acquired at closing of $292,000; |
b) | To adjust the balance to reflect the fair value of receivables at acquisition; |
c) | To adjust balance to combine property and equipment with cranes, and reflect fair value at Acquisition; |
d) | Adjustment represents recognition of right-of-use assets and lease liabilities as September 30, 2022 as Circle 8 was a privately held company not required to implement the provisions of Accounting Standards Codification 842 – Leases; |
e) | To adjust other assets to fair value; |
f) | Adjustment, net of issuance costs and unamortized debt discount, to book paydown of senior credit facility by $11.65 million and Trive notes to zero balance; |
g) | Represents adjustment to recognize earnout liability and adjustment of accounts payable and accrued liabilities to fair value; |
h) | Record goodwill for value obtained in excess of net assets acquired; |
F-7 |
i) | Adjustment for acquisition expenses paid by Ault; |
j) | Remove Circle 8 historical member stock and deficit; |
k) | Represents a decrease in pro forma depreciation expense related to the acquired rental cranes and property and equipment based on a fair value of $36.4 million as of the date of Acquisition and estimated useful lives of 7-10 years; |
l) | Represents a decrease in pro forma interest expense related to the revolver and Trive subordinated debt payments of $11.65 million and $3 million, respectively; |
m) | To remove non-controlling interests' portion of pro forma net income; |
n) | Adjustment to recognize pro forma intangible amortization expense based on a fair value of $5.8 million as of the date of Acquisition and estimated useful lives of 5 years; |
o) | Adjustment to record tradename intangible asset at fair value at time of Acquisition; |
p) | Adjustment to Record customer relationship intangible asset at fair value at time of Acquisition. |
F-8