Exhibit 99.3
U.S. HEALTH BENEFITS GROUP, INC. and its COMBINED AFFILIATES
Unaudited Combined Financial Statements
As of March 31, 2008
Contents
Financial Statements | |
| Unaudited Combined Balance Sheet as of March 31, 2008 | 2 |
| Unaudited Combined Statements of Operations for the Three Months Ended March 31, 2008 and 2007 | 3 |
| Unaudited Combined Statement of Cash Flows for the Three Months Ended March 31, 2008 and 2007 | 4 |
Notes to Unaudited Interim Combined Financial Statements | 5 |
U.S. HEALTH BENEFITS GROUP, INC. and its COMBINED AFFILIATES
Unaudited Combined Balance Sheet
As of March 31, 2008
| ASSETS | | | |
| Current assets | | | |
| Cash | | $ | 59,432 | |
| Accounts receivable | | | 142,018 | |
| Prepaid expenses and other current assets | | | 15,893 | |
| Total current assets | | | 217,343 | |
| | | | | |
| Property and Equipment, net | | | 271,453 | |
| | | | | |
| Total assets | | $ | 488,796 | |
| | | | | |
| LIABILITIES AND STOCKHOLDER'S EQUITY | | | | |
| Current liabilities | | | | |
| Accounts payable | | $ | 46,976 | |
| Current portion of long-term debt | | | 81,206 | |
| Accrued expenses | | | 95,512 | |
| Total current liabilities | | | 223,694 | |
| | | | | |
| Total liabilities | | | 223,694 | |
| | | | | |
| Stockholder's Equity | | | | |
| Common stock | | | 1,020 | |
| Additional paid-in capital | | | 292,450 | |
| Retained earnings (deficit) | | | (28,368 | ) |
| Total stockholder's equity | | | 265,102 | |
| | | | | |
| Total liabilities and stockholder's equity | | $ | 488,796 | |
See Notes to Unaudited Interim Combined Financial Statements
U.S. HEALTH BENEFITS GROUP, INC. and its COMBINED AFFILIATES
Unaudited Combined Statements of Operations
For the Three Months Ended March 31,
| | | 2008 | | | 2007 | |
| | | | | | | |
| Revenue, net | | $ | 1,317,262 | | | $ | 2,062,425 | |
| Cost of revenue | | | 324,039 | | | | 553,541 | |
| Gross profit | | | 993,223 | | | | 1,508,884 | |
| | | | | | | | | |
| Operating expenses | | | 824,224 | | | | 921,954 | |
| Operating income | | | 168,999 | | | | 586,930 | |
| | | | | | | | | |
| Other income (expense): | | | | | | | | |
| Interest income | | | 33 | | | | 817 | |
| Interest expense | | | - | | | | - | |
| Other | | | (120 | ) | | | - | |
| Other income (expense) | | | (87 | ) | | | 817 | |
| | | | | | | | | |
| Net income | | $ | 168,912 | | | $ | 587,747 | |
See Notes to Unaudited Interim Combined Financial Statements
U.S. HEALTH BENEFITS GROUP INC. and its COMBINED AFFILIATES
Unaudited Combined Statement of Cash Flows
For the Three Months Ended March 31,
| | | 2008 | | | 2007 | |
| Cash Flows from Operating Activities | | | | | | |
| Net income | | $ | 168,912 | | | $ | 546,038 | |
| Adjustments to reconcile net income to net cash | | | | | | | | |
| provided by operating activities: | | | | | | | | |
| Depreciation | | | 20,248 | | | | 27,221 | |
| Changes in assets and liabilities: | | | | | | | | |
| Accounts receivable | | | (27,406 | ) | | | (89,434 | ) |
| Prepaid and other | | | - | | | | 500 | |
| Accounts payable | | | (8,731 | ) | | | (388,783 | ) |
| Accrued expenses | | | 20,648 | | | | (42,713 | ) |
| Net cash provided by operating activities | | | 173,671 | | | | 52,829 | |
| | | | | | | | | |
| Cash Flows from Investing Activities | | | | | | | | |
| Acquisition of property and equipment | | | - | | | | (65,856 | ) |
| Net cash used in investing activities | | | - | | | | (65,856 | ) |
| | | | | | | | | |
| Cash Flows from Financing Activities | | | | | | | | |
| Proceeds from long-term debt | | | - | | | | 83,716 | |
| Principal payments on long-term debt | | | (2,693 | ) | | | | |
| Principal payments on promissory note | | | - | | | | (3,900 | ) |
| Shareholder distributions | | | (165,135 | ) | | | (115,438 | ) |
| Net cash used in financing activities | | | (167,828 | ) | | | (35,622 | ) |
| | | | | | | | | |
| Net increase (decrease) in cash | | | 5,843 | | | | (48,649 | ) |
| | | | | | | | | |
| Cash: | | | | | | | | |
| Beginning | | | 53,589 | | | | 102,238 | |
| Ending | | $ | 59,432 | | | | 53,589 | |
| | | | | | | | | |
| Supplemental Disclosure of Cash Flow Information | | | | | | | | |
| Cash paid for interest | | $ | - | | | $ | - | |
See Notes to Unaudited Interim Combined Financial Statements
NOTES TO UNAUDITED INTERIM COMBINED FINANCIAL STATEMENTS
Basis of Presentation
The accompanying condensed combined financial statements include the accounts of U.S. Health Benefits Group, Inc. and its combined affiliates after elimination of all significant intercompany balances and transactions. The financial statements have been prepared pursuant to accounting principles for the preparation of interim financial statements and note disclosures normally included in annual financial statements prepared in accordance with United States generally accepted accounting principles have been condensed or omitted pursuant to those principles. The Company believes that the disclosures made are adequate to make the information not misleading.
The accompanying unaudited condensed consolidated financial statements have been prepared on a basis consistent with the accounting principles and policies reflected in the Company’s financial statements for the year ended December 31, 2007. In the opinion of Management, the accompanying unaudited condensed combined financial statements contain all adjustments (consisting only of normal recurring accruals) necessary for a fair presentation of its combined financial position at March 31, 2008 and the combined results of operations and cash flows for the three month periods ended March 31, 2008 and 2007. The results of operations for the stated periods are not necessarily indicative of results to be expected for the full year.
Subsequent Event
In March 2008, the Company and its stockholder entered into an agreement to sell all of the shares in the Company to The Amacore Group, Inc. (“Amacore”). Lifeguard Benefit Services, Inc., a wholly-owned subsidiary of Amacore, was a significant provider of health benefit plans sold by the Company and accounted for approximately 67% or the Company’s net commission revenue for the year ended December 31, 2007. The sale was completed on April 1, 2008.
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