EXHIBIT 99.2
UNAUDITED PRO FORMA CONDENSED COMBINED
FINANCIAL STATEMENTS POST-MERGER
UBRANDIT.COM, INC.
INDEX TO PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
Unaudited Pro Forma Condensed Combined Financial Information of
Ubrandit.com, Inc.
Introduction to Unaudited Pro Forma Condensed Combined Financial
Information........................................................ F-16
Unaudited Pro Forma Condensed Combined Balance Sheet as of December
31, 2000........................................................... F-17
Unaudited Pro Forma Condensed Combined Statement of Operations for
the Three-Month Period Ended December 31, 2000..................... F-18
Unaudited Pro Forma Condensed Combined Statement of Operations for
the Year Ended September 30, 2000.................................. F-19
Unaudited Pro Forma Condensed Combined Financial Information........ F-20
F-15
UBRANDIT.COM, INC.
UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
The following unaudited pro forma condensed combined financial information
is based upon historical financial statements and has been prepared to
illustrate the effects of the proposed acquisition of Mindtronics Corporation.
The acquisition contemplates the Company's issuance of 12,100,000 shares of
common stock for all of the issued and outstanding shares of common stock of
Mindtronics Corporation. The acquisition has not been consummated and is
subject to the satisfaction of various contingencies, including shareholder
approval.
The acquisition of Mindtronics will be accounted for using the purchase
method of accounting with the assets acquired and liabilities assumed recorded
at their fair market value as of the date of the acquisition. The excess of the
purchase price over the fair value of the assets acquired and liabilities
assumed represents goodwill which will be amortized on a straight-line basis
over the estimated useful life of five years.
The unaudited pro forma condensed combined balance sheet assumes the
acquisition occurred on December 31, 2000, and was prepared using the unaudited
historical balance sheets of the Company and Mindtronics Corporation as of that
date. The unaudited pro forma condensed combined statements of operations
illustrate the effect of the acquisition of Mindtronics Corporation on the
Company's results of operations for the three-month period ended December 31,
2000, and the year ended September 30, 2000, assuming the acquisition took
place as of October 1, 1999.
The unaudited pro forma condensed combined balance sheet and statements of
operations are not intended to be indicative of the financial position or
results of operations which actually would have been realized had the
acquisition occurred on the dates assumed, nor of future results of operations
of the entities on a combined basis. The accompanying unaudited pro forma
condensed combined financial statements should be read in connection with the
unaudited and audited historical financial statements and notes of the Company
and Mindtronics Corporation.
F-16
UBRANDIT.COM, INC.
UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
December 31, 2000
Proforma
Adjustments
Debit Proforma
Ubrandit(1) Mindtronics(2) (Credit) Consolidated
----------- -------------- ----------- ------------
Current Assets:
Cash...................... $ 2,794,817 $ 45,143 $ -- $ 2,839,960
Accounts receivable....... 16,217 -- -- 16,217
Prepaid expenses.......... 14,912 4,059 -- 18,971
Deposits.................. 36,874 41,287 -- 78,161
Inventory................. 25,502 -- -- 25,502
Note Receivable........... -- 5,858 -- 5,858
----------- --------- ----------- -----------
Total current assets........ 2,888,322 96,347 -- 2,984,669
Other assets:
Property and equipment,
net...................... 372,557 151,016 -- 523,573
Notes receivable from
Mindtronics Corporation.. 309,507 -- (309,507)(5) --
Core technology, net...... 338,040 -- -- 338,040
Goodwill, net............. 1,255,874 -- 10,274,997 (6) 11,530,871
Deposits.................. 17,153 -- -- 17,153
----------- --------- ----------- -----------
Total assets................ $ 5,181,453 $ 247,363 $ 9,965,490 $15,394,306
=========== ========= =========== ===========
Current liabilities:
Accounts payable.......... $ 174,268 $ 95,184 $ -- $ 269,452
Accrued expenses.......... 100,999 33,761 -- 134,760
Loans payable to related
parties.................. 61,735 28,808 -- 90,543
Current portion of lease
payable.................. 35,243 -- -- 35,243
Notes payable to
Ubrandit.com............. -- 309,507 (309,507)(5) --
=========== ========= =========== ===========
Total current liabilities... 372,245 467,260 (309,507) 529,998
Leases payable, net of
current portion.......... 22,489 -- -- 22,489
----------- --------- ----------- -----------
Total liabilities........... 394,734 467,260 (309,507) 552,487
----------- --------- ----------- -----------
Shareholders' equity:
Common stock.............. 12,167 10,123 1,977 24,267
Additional paid in
capital.................. 9,017,445 514,197 9,528,803 19,060,445
Accumulated deficit....... (4,242,893) (744,217) 744,217 (4,242,893)
----------- --------- ----------- -----------
Total shareholders' equity.. 4,786,719 (219,897) 10,274,997 (6) 14,841,819
----------- --------- ----------- -----------
Total liabilities and
shareholders' equity....... $ 5,181,453 $ 247,363 $ 9,965,490 $15,394,306
=========== ========= =========== ===========
See notes to pro forma condensed combined statement of operations on F-20.
F-17
UBRANDIT.COM, INC.
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
For the Three-Month Period Ended December 31, 2000
Proforma
Adjustments Proforma
Ubrandit(1) Mindtronics(2) Debit (Credit) Combined
----------- -------------- -------------- -----------
Revenue................. $ 472,677 $ -- $ -- $ 472,677
Cost of sales........... 436,387 -- -- 436,387
--------- --------- --------- -----------
Gross margin............ 36,290 -- -- 36,290
Sales, general and
administrative......... 741,090 218,025 513,750 (7) 1,472,865
Research and
development............ 123,465 62,188 -- 185,653
--------- --------- --------- -----------
Operating loss.......... (828,265) (280,213) (513,750) (1,622,228)
Interest income......... 40,277 -- -- 40,277
Interest expense........ (3,210) (1,220) -- (4,430)
Other income (expense).. -- (437) -- (437)
--------- --------- --------- -----------
Net loss................ $(791,198) $(281,870) $(513,750) $(1,586,818)
========= ========= ========= ===========
Net loss per share,
basic and diluted...... $ (0.07) $ (0.07)(8)
========= ===========
See notes to pro forma condensed combined statement of operations on F-20.
F-18
UBRANDIT.COM, INC.
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
For the Year Ended September 30, 2000
Proforma
Adjustments Proforma
Ubrandit(3) Mindtronics(4) Debit (Credit) Combined
----------- -------------- -------------- -----------
Revenue................. $ 869,623 $ -- $ -- $ 869,623
Cost of sales........... 1,100,405 -- -- 1,100,405
----------- --------- ----------- -----------
Gross loss.............. (230,782) -- -- (230,782)
Sales, general and
administrative......... 2,032,420 334,577 -- 2,366,997
Research and
development............ -- 110,423 -- 110,423
Depreciation and
amortization........... 365,969 5,025 2,054,999 (7) 2,425,993
----------- --------- ----------- -----------
Operating loss.......... (2,629,171) (450,025) (2,054,999) (5,134,195)
Interest income......... 233,349 -- -- 233,349
Interest expense........ (8,028) (4,939) -- (12,967)
Other income (expense).. -- 1,067 -- 1,067
----------- --------- ----------- -----------
Net loss................ $(2,403,850) $(453,897) $(2,054,999) $(4,912,746)
=========== ========= =========== ===========
Net loss per share,
basic and diluted...... $ (0.20) $ (0.20)(8)
=========== ===========
See notes to pro forma condensed combined statement of operations on F-20.
F-19
UBRANDIT.COM, INC.
NOTES TO THE UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS
(1) Represents unaudited historical financial information of Ubrandit.com, Inc.
as reflected in the consolidated financial statements of Ubrandit.com,
Inc., included in its quarterly report on Form 10-Q filed with the
Securities and Exchange Commission on February 20, 2001.
(2) Represents unaudited historical financial information of Mindtronics
Corporation as reflected in the consolidated financial statements included
herein at Exhibit 99.1.
(3) Represents audited historical financial information of Ubrandit.com, Inc.
as reflected in the consolidated financial statements of Ubrandit.com, Inc.
included in its annual report on Form 10-K filed with the Securities and
Exchange Commission on January 4, 2001.
(4) Represents audited historical financial information of Mindtronics
Corporation as reflected in the consolidated financial statements of
Mindtronics Corporation included herein at Exhibit 99.1.
(5) Represents elimination of intercompany loans.
(6) The acquisition of Mindtronics Corporation is expected to be accounted for
using the purchase method of accounting, with the assets acquired and
liabilities assumed recorded at their fair market value as of the date of
the acquisition. The excess of the purchase price over the fair value of
the assets acquired and liabilities assumed represents goodwill which is
expected to be amortized on a straight-line basis over an estimated useful
life of five years. The proforma adjustments to record the acquisition in
the accompanying unaudited pro forma condensed combined balance sheet are
as follows:
Purchase price: issuance of 12,100,000 shares of the Company's
common stock valued at $0.831 per share...................... $10,055,100
Estimated fair value of the net assets........................ 219,897
-----------
Goodwill...................................................... $10,274,997
===========
(7) Goodwill is estimated to have a useful life of five years and is amortized
using the straight-line method. Amortization for a one year period is
estimated at $2,054,999 and for a three-month period is estimated at
$513,750.
(8) Pro forma loss per share is based on the weighted average number of shares
of common stock outstanding during the period after giving pro forma effect
to the issuance of 12,100,000 shares of Common Stock of Ubrandit.com, Inc.
to the shareholders' of the Mindtronics Corporation. Options and warrants
to purchase common stock were excluded in the calculation of the pro forma
loss per share, as their effect would be antidilutive. The computation of
the pro forma weighted average number of shares is as follows:
For the Year Ended December 31, 2000
------------------------------------
Historical weighted average number of shares of Ubrandit.com,
Inc......................................................... 12,167,333(1)
Shares of common stock expected to be issued upon
consummation of the proposed acquisition.................... 12,100,000
----------
Pro forma weighted average shares............................ 24,267,333
==========
For the Year Ended September 30, 2000
-------------------------------------
Historical weighted average number of shares of Ubrandit.com,
Inc......................................................... 11,912,141(3)
Shares of common stock expected to be issued upon
consummation of the proposed acquisition.................... 12,100,000
----------
Pro forma weighted average shares............................ 24,012,141
==========
F-20