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EXHIBIT 99.2
POPMAIL.COM, INC.
UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION
The following pro forma unaudited combined financial statements are prepared to
reflect the February 9, 2000 merger of the registrant, PopMail.com, inc.
(PopMail) and IZ.com Incorporation (IZ.com), which was accounted for as a
purchase. The pro forma unaudited combined financial information consists of
pro forma unaudited combined statements of operations for the year ended
January 2, 2000 and a pro forma unaudited combined balance sheet as of January
2, 2000. The pro forma unaudited combined statement of operations gives effect
to the merger as if the transaction had occurred on January 3, 1999. The pro
forma unaudited combined balance sheet gives effect to the acquisition as if it
had occurred on January 2, 2000.
The pro forma unaudited combined financial statements give effect to certain
adjustments, including: (1) the issuance of 417,916 shares of PopMail Series F
Preferred Stock at an assumed conversion ratio of 25.66 shares of common stock;
(2) the recording of estimated costs related to the transaction, (3) the
elimination of the stockholders deficit of IZ.com, and (4) the recording of the
resulting goodwill created by the merger, as well as related amortization
expense.
The periods presented conform to the fiscal year of the registrant.
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POPMAIL.COM, INC.
PRO FORMA UNAUDITED COMBINED BALANCE SHEET
JANUARY 2, 2000
Pro forma Pro forma
ASSETS PopMail IZ.com adjustments combined
------------------------------------------------- -----------------
CURRENT ASSETS
Cash and cash equivalents $ 1,136,137 $ 66,167 $ - $ 1,202,304
Accounts receivable, net 275,655 - - 275,655
Inventories 111,807 - - 111,807
Other current assets 483,496 - - 483,496
------------------------------------------------- -----------------
Total current assets 2,007,095 66,167 - 2,073,262
PROPERTY AND EQUIPMENT, NET 14,866,802 233,135 - 15,099,262
OTHER ASSETS 344,121 395,665 - 739,786
GOODWILL, net 36,277,346 - 49,481,575 (1) 85,758,921
------------------------------------------------- -----------------
$ 53,495,364 $ 694,967 $ 49,481,575 $ 103,671,906
================================================= =================
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable $ 6,037,518 $ - $ - $ 6,037,518
Accounts payable 1,604,952 950,646 - 2,555,598
Convertible promissory notes payable 1,460,417 - - 1,460,417
Current portion of long-term obligations 193,833 - - 193,833
Due to affiliates 120,000 - - 120,000
Accrued compensation 529,336 26,291 - 555,627
Other accrued expenses 757,516 - - 757,516
------------------------------------------------- -----------------
Total current liabilities 10,703,572 976,937 - 11,680,509
DEFERRED RENT CREDITS 3,650,512 - - 3,650,512
LONG-TERM OBLIGATIONS, less current maturities 1,883,688 1,121,793 - 3,005,481
------------------------------------------------- -----------------
Total liabilities 16,237,772 2,098,730 - 18,336,502
COMMITMENTS AND CONTINGENCIES - - - -
SHAREHOLDERS' EQUITY
Common stock 246,958 3,101 (3,101)(1) 246,958
Preferred stock 3,331,000 141,114 (141,114)(1) 51,507,242
48,176,242 (1)
Additional paid-in capital 74,901,160 3,543,880 (3,543,880)(1) 74,901,160
Less common stock subscribed and note receivable
from affiliate (2,850,000) (98,430) - (2,948,430)
Retained earnings (deficit) (38,371,526) (4,993,428) 4,993,428 (1) (38,371,526)
------------------------------------------------- -----------------
37,257,592 (1,403,763) 49,481,575 85,335,404
------------------------------------------------- -----------------
$ 53,495,364 $ 694,967 $ 49,481,575 $ 103,671,906
================================================= =================
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POPMAIL.COM INC.
NOTES TO PRO FORMA UNAUDITED CONDENSED BALANCE SHEET
JANUARY 2, 2000
(1) Reflects the issuance of shares and transaction expenses to effect the
merger of IZ.com Incorporated with IZ Acquisition Corporation, a wholly
owned subsidiary of PopMail, the elimination of stockholders deficit of
IZ.com, and the recording of goodwill by PopMail as follows:
PopMail Series F preferred stock issued 287,408
PopMail Series F preferred stock assumed issued for options 130,508
--------------------
Total shares preferred stock issued 417,916
Conversion ratio of preferred to common upon shareholder approval 25.66
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10,723,725
Price per share of PopMail common $ 4.46(a)
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Total 47,827,812
Plus transaction expenses of IZ.com merger 250,000
--------------------
Total consideration and costs 48,077,812
Excess of IZ.com liabilities assumed over the fair value of assets purchased 1,403,763
--------------------
Goodwill created $ 49,481,575
====================
(a) The price per share is based on the closing price of the PopMail common
stock for the five business days ending two days prior to the February 9, 2000
closing.
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POPMAIL.COM, INC.
PRO FORMA UNAUDITED COMBINED STATEMENT OF OPERATIONS
52 WEEKS ENDED JANUARY 2, 2000
PRO FORMA PRO FORMA
POPMAIL IZ.COM ADJUSTMENTS COMBINED
-------------------------------------------------------------------------
Revenues $ 12,273,198 $ - $ - $ 12,273,198
Costs and expenses:
Restaurant food, beverage and retail costs 3,144,513 - - 3,144,513
Restaurant operating expenses 8,404,324 - - 8,404,324
Restaurant depreciation 1,639,279 - - 1,639,279
Amortization of goodwill 3,933,411 - 16,493,858 (1) 20,427,269
Pre-opening expenses 939,179 - - 939,179
Selling, general, administrative and
development expenses 5,002,557 5,013,369 - 10,015,926
------------------------------------------------- -------------------
23,063,263 5,013,369 16,493,858 44,570,490
Loss from operations (10,790,065) (5,013,369) (16,493,858) (32,297,292)
Other income (expense):
Interest expense (2,357,245) - - (2,357,245)
Interest Income 49,323 19,941 - 69,264
Warrant repricing (4,539,311) - - (4,539,311)
Debt guarantee costs (1,607,833) - - (1,607,883)
Financial advisory services (1,489,040) - - (1,489,040)
------------------------------------------------- -------------------
(9,944,106) 19,941 - (9,924,165)
------------------------------------------------- -------------------
Net loss (20,734,171) (4,993,428) (16,493,858) (42,221,457)
Preferred stock dividends and accretion (3,514,461) - - (3,514,461)
------------------------------------------------- -------------------
Net loss attributable to common shareholders $(24,248,632) $ (4,993,428) $(16,493,858) $ (45,735,918)
================================================= ===================
Basic and diluted net loss per share:
Net loss $ (2.05) $ (2.03)
================= ===================
Loss attributable to common shareholders $ (2.40) $ (2.20)
Basic and diluted weighted average ================= ===================
outstanding shares 10,108,451 10,723,725 20,832,176
(1) Reflects goodwill arising from the IZ.com acquisition of $49,481,575
amortized on a straight-line basis over three years.
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