ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD.
CONSOLIDATED PRO-FORMA BALANCE SHEET (UNAUDITED)
AS OF DECEMBER 31, 1996 AND JUNE 30, 1997
ASSETS
DECEMBER 31, JUNE 30,
1996 1997
----------------------------------------------
CURRENT ASSETS
Cash in Bank $436,152 $ 20,485
Accounts Receivable 23,742 1,850,218
Refundable Income Tax 77,215 -
Prepaid Expenses 4,510 3,333
-----------------------------------------
TOTAL CURRENT ASSETS: 541,619 1,874,036
-----------------------------------------
Property and Equipment, at cost - Net of Accumulated
Depreciation and Amortization 348,638 344,796
Software - Net of Accumulated Amortization 1,159,814 1,176,016
OTHER ASSETS Investment in Subsidiary:
Customer Lists 1,374,687 1,374,687
Goodwill 162,000 162,000
-----------------------------------------
1,536,687 1,536,687
Accumulated Amortization (102,446) (41,483)
-----------------------------------------
1,434,241 1,495,204
Investments - 52,962
Security Deposits 3,201 7,252
Organization Costs - (Net of Accum Amort of $645) 2,902 2,580
Due From Related Party 48,273 49,855
Other Assets 4,866 1,301
-----------------------------------------
TOTAL OTHER ASSETS 1,493,483 1,609,154
-========================================
TOTAL ASSETS $3,543,554 5,004,002
===================== ===================
(Continued)
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD.
CONSOLIDATED PRO-FORMA BALANCE SHEET (UNAUDITED)
AS OF DECEMBER 31, 1996 AND JUNE 30, 1997
(Continued)
LIABILITIES AND STOCKHOLDERS' EQUITY
DECEMBER 31, JUNE 30,
1996 1997
CURRENT LIABILITIES
Accounts Payable and Accrued Expenses $ 261,284 $ 377,310
Customer Deposits 28,279 83,873
Current Portion of Long Term Debt 14,731 19,106
Taxes Payable - 37,105
Other Current Liabilities 4,190 38,837
Due to Officers 21,655 11,946
--------------------------------------
TOTAL CURRENT LIABILITIES 330,139 568,177
OTHER LIABILITIES
Long Term Debt Net of Current 19,212 11,794
---------------------------------------
TOTAL OTHER LIABILITIES 19,212 11,794
SHAREHOLDERS'S EQUITY:
Preferred Stock - Par Value $.001 Per Share, Authorized
10,000,000 Shares, None Issued or Outstanding - -0-
Common Stock - Par Value $001 Per Share, Authorized
100,000,000 Shares, Issued and Outstanding 9,465,184 Shares 9,390 9,465
Additional Paid - in - Capital 3,475,546 4,006,023
Retained Earnings (Deficit) (290,733) 408,543
---------------------------------------
Total Stockholders' Equity 3,194,203 4,424,031
---------------------------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 3,543,554 $ 5,004,002
================= =====================
2
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD.
CONSOLIDATED PRO-FORMA STATEMENTS OF OPERATIONS (UNAUDITED)
FISCAL YEAR ENDED SIX MONTHS ENDED
DECEMBER 31, JUNE 30,
1996 1997
--------------- --------------
REVENUE
Consulting Fees $ 366,204 $ -
Software Sales and Related Charges 87,000 1,614,278
Support Fees - 6,000
Medical Products 1,452
ISP and Website Income 423,441 320,268
----------- ----------------
Total Revenue 878,097 1,940,546
COST OF SALES
Installation and Hardware Costs - 83,396
Internic Regist. Fees / Connect Fees 160,133 98,838
----------- ----------------
Total 160,133 182,234
GROSS PROFIT 717,964 1,758,312
OPERATING EXPENSES
General and Administrative 895,213 705,562
Amortization 102,446 166,628
Inputed Salary and Taxes - EmiNet 132,254 58,516
Depreciation 85,032 41,037
----------- ---------------
Total Operating Expenses 1,214,945 971,743
Income (Loss) From Operations (496,981) 786,569
OTHER INCOME (EXPENSE)
Interest Income 4,350 3,736
Interest Expense (8,468) (2,541)
Income Tax 77,215 (119,068)
Loss on Sale of Investments - (20,784)
Other Income (Expense) 3,556 -
----------- --------------------
Total Other Income (Expense) 76,653 (138,657)
Income From Continuing Operations (420,328) 647,912
(Loss) from Operations of Discontinued Foreign
Subsidiary (29,244) (69,531)
Gain on Sale of Discontinued Foreign Subsidiary - 120,895
------------ --------------------
Total Income from Discontinued Operation. (29,244) 51,364
NET INCOME (LOSS) $ (449,572) 699,276
Retained Earnings (Deficit) - Beginning 158,839 (290,733)
------------- ----------------
Retained Earnings (Deficit) - Ending (290,733) 408,543
============= ================
(Loss) Income Per Common Share $ (0.048) 0.074
============= ================
Number of Shares 9,390,184 9,465,184
============= ================
3
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD.
CONSOLIDATED PRO-FORMA STATEMENT OF CASH FLOWS (UNAUDITED)
FISCAL YEAR ENDED SIX MONTHS ENDED
DECEMBER 31, JUNE 30,
1996 1997
---------------- --------------------
OPERATING ACTIVITIES:
(Loss) Income From Continuing Operations $ (420,328) $ 647,912
-------------- ------------
Cash Flows from Operating Activities:
Adjustments to reconcile net loss to net
Cash provided by operating activities:
Depreciation and amortization 187,478 207,665
Changes in operating assets and liabilities:
Decrease (increase) in:
Trade accounts receivable (74,278) (1,878,466)
Prepaid expenses and other current assets 20,582 77,436
Security Deposits - -
Investments - 56,681
Other assets (9,178) 3,231
Increase (decrease) in:
Accounts payable and Accrued Expenses 230,039 139,078
Income taxes payable (90,500) 37,105
Customer Deposits 83,242
Other Current Liabilities 631 38,836
------------ ------------
Net cash - Continuing Operations - Forward (155,554) (587,280)
Discontinued Operations:
(Loss) from Discontinued Operations (29,244) (69,531)
Gain on Disposal of Discontinued Operations - 120,895
Adjustments to reconcile Net (Loss) to Net Cash - -
Operations:
Depreciation and Amortization 1,278 1,366
------------ ------------
Changes in assets and liabilities:
(Increase) Decrease in: - -
Other Assets (815) 815
Increase (Decrease) in:
Accounts Payable 14,808 (14,808)
Customer Deposits - -
Other Current Liabilities 27,648 (27,648)
Total Adjustments - -
------------ ------------
Net Cash - Discontinued Operations - Forward 13,675 11,089
------------ ------------
Net Cash - Operating Activities - Forward (141,879) (576,191)
------------ ------------
Investing Activities - Continuing Operations
Net increase in due from related parties (37,177) (1,582)
Sale (Purchase) of Subsidiary - (1,620,000)
Sale (Purchase) of Investments 10,252 (73,746)
Sale (Purchase) of property and equipment (326,085) (226,244)
------------- ------------
Net cash used in investing activities - Forward $(353,010) $(1,921,572)
(Continued)
4
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD.
CONSOLIDATED PRO-FORMA STATEMENT OF CASH FLOWS (UNAUDITED)
(Continued)
FISCAL YEAR ENDED SIX MONTHS ENDED
DECEMBER 31, JUNE 30,
1996 1997
--------------- -----------------
Investing Activities - Discontinuing Operations
(Purchase) Disposition of property and equipment $ (13,755) $ 11,110
--------- -----------
Net Cash Investing Activities (366,765) (1,910,462)
--------- -----------
Financing Activities - Continuing Operations
Proceeds from issuance of common stock 701,770 1,949,330
Increase in loan payable to shareholder 21,655 (9,709)
Additions to paid in capital - 14,238
Proceeds from equipment loans 22,190 30,900
Principal Payments on capitalized lease and Note (8,509) (12,548)
--------- ------------
Net cash - Financing Activities - Continuing Operations 737,106 1,972,211
Financing Activities - Discontinued Operations
Additions to Additional paid in Capital - 98,775
--------- ------------
Net Cash Financing Activities 737,106 2,070,986
--------- ------------
Increase (Decrease) in cash and cash equivalents 228,462 (415,667)
Cash & cash equivalents beginning of Year 207,690 436,152
========= =============
Cash & cash equivalents, end of Year $ 436,152 $ 20,485
========= =============
Supplemental disclosure of cash flow information:
Cash paid (received) during the period for:
Interest Expense $ 8,468 $ 2,541
Income Tax Refund (Applied) $ - $ (77,215)
Income Tax $(77,215) $ -
5
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD.
CONSOLIDATED PRO- FORMA STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
(UNAUDITED)
COMMON STOCK ADDITIONAL
NUMBER PAID - IN
SHARES AMOUNT CAPITAL
------------------- ---------------- -----------------
BALANCE - JANUARY 1, 1996 6,803,451 $ 6,803 $ (6,173)
Pro-Forma Adjustment - Eminet Acquisition 200,000 200 1,599,800
Pro-Forma Adjustment - Eminet Consolidation - - (12,170)
Equity of CEEE 1,500,033 1,500 (6,794)
Sale of Common Stock 13 13 35,749
Recapitalization Adjustment (13) (13) 13
Private Placement 886,700 887 825,994
Asset Acquisition 200,000 - 1,200,000
Recapitalization Adjustment (200,000) - -
Recapitalization Costs - - (160,873)
(Loss) From Continuing Operations - - -
(Loss) From Discontinued Foreign Subsidiary - - -
------------------------------------------------------
BALANCE - DECEMBER 31, 1996 9,390,184 $ 9,390 $3,475,546
======================================================
Sale of Common Stock (Reg S) 75,000 75 524,925
Recapitalization Costs - - (174,750)
Asset Acquisition Costs - - (920)
Consolidated Elimination-EmiNet - - 82,447
Income from Continuing Operations - - -
Disposal of Discontinued Operations - - 98,775
[Loss] from Discontinued Operations - - -
------------------------------------------------------
BALANCE - JUNE 30, 1997 $9,465,184 $ 9,465 $4,006,023
======================================================
(Continued)
6
ATLANTIC INTERNATIONAL ENTERTAINMENT, LTD.
CONSOLIDATED PRO-FORMA STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
(UNAUDITED)
(Continued)
ACCUMULATED
(DEFICIT)/ TOTAL
RETAINED PREFERRED STOCKHOLDERS'
EARNINGS STOCK CAPITAL
------------------- ---------------- -----------------
BALANCE - JANUARY 1, 1996 $ 158,839 $ - $ 159,469
Pro-Forma Adjustment - Eminet Acquisition - - 1,600,000
Pro-Forma Adjustment - Eminet Consolidation - - (12,170)
Equity of CEEE - - (5,294)
Sale of Common Stock - - 35,762
Recapitalization Adjustment - - -
Private Placement - - 826,881
Asset Acquisition - - 1,200,000
Recapitalization Adjustment - - -
Recapitalization Costs - - (160,873)
(Loss) From Continuing Operations (420,328) - (420,328)
(Loss) From Discontinued Foreign Subsidiary (29,244) - (29,244)
==============================-=================
BALANCE - DECEMBER 31, 1996 (290,733) - 3,194,203
================================================
Sale of Common Stock (Reg S) - - 525,000
Recapitalization Costs - - (174,750)
Asset Acquisition Costs - - (920)
Consolidated Elimination-EmiNet - - 82,447
Income from Continuing Operations 647,912 - 647,912
Disposal of Discontinued Operations 120,895 - 219,670
[Loss] from Discontinued Operations (69,531) - (69,531)
------------------------------------------------
BALANCE - JUNE 30, 1997 $ 408,543 $ - $4,424,031
================================================