EXHIBIT 99.2
IMPULSE MEDIA TECHNOLOGIES INC.
(FORMERLY DENMANS.COM INC.)
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION
The following unaudited pro forma condensed consolidated financial information
has been prepared to give the effect to the acquisition of all issued and
outstanding shares of Impulse Media Technologies Inc. ("Impulse") on October 19,
2001. The pro forma condensed consolidated financial information is based on the
following:
1. The unaudited historical consolidated financial statements as
of August 31, 2001 and for the six months then ended;
2. The Impulse unaudited historical consolidated financial
statements as of August 31, 2001 and for the six months then
ended;
3. The audited historical consolidated financial statements for
the year ended February 28, 2001;
4. The Impulse audited consolidated financial statements for the
year ended February 28, 2001; and
5. Pro forma adjustments as described in the accompanying notes.
The pro forma condensed consolidated balance sheet as of August 31, 2001 gives
effect to the acquisition of Impulse as if it occurred by purchase as of August
31, 2001. The pro forma condensed consolidated statement of operations for the
six months ended August 31, 2001 gives effect to the acquisitions of Impulse as
if it occurred as of March 1, 2001. The pro forma condensed consolidated
statement of operations for the year ended February 28, 2001 gives effect to the
acquisition of Impulse as if it occurred on March 1, 2000.
The related adjustments are described in the accompanying notes. The unaudited
pro forma condensed consolidated financial information is based upon available
information, which has been used solely for the purposes of developing such
unaudited pro forma financial information. The unaudited pro forma condensed
consolidated financial information does not purport to represent what our
results of operations or financial condition would have been had the acquisition
of Impulse occurred as of the pro forma dates specified above, or to project the
results of operations or financial condition for any future period or date.
The unaudited pro forma condensed consolidated financial information should be
read in conjunction with our historical financial statements and notes, and the
historical financial statements and notes of Impulse, the latter of which are
included herein.
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IMPULSE MEDIA TECHNOLOGIES INC.
(FORMERLY DENMANS.COM INC.)
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AUGUST 31, 2001
Pro Forma
DENMANS Pro Forma Consolidated
(as Reported) Impulse Adjustments DENMANS
------------ ------------ ------------ ------------
CURRENT ASSETS
Cash $ -- $ 1,476 $ -- $ 1,476
Accounts receivable 5,711 33,321 -- 39,032
Prepaid Expenses -- 1,346 -- 1,346
------------ ------------ ------------ ------------
Total current assets 5,711 36,143 -- 41,854
Intangible assets -- 8,282 -- 8,282
Property and equipment, net of
accumulated depreciation of $322 -- 8,111 -- 8,111
------------ ------------ ------------ ------------
Total assets $ 5,711 $ 52,536 $ -- $ 58,247
============ ============ ============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Bank overdraft $ 8,143 $ -- $ -- $ 8,143
Accounts payable and accrued
liabilities 24,656 479,532 -- 504,188
Accrued interest payable 621,084 -- 2 (621,084) --
Loans payable -- 28,673 -- 28,673
Compensation withholdings
for stock subscriptions -- 12,465 -- 12,465
------------ ------------ ------------ ------------
Total current liabilities 653,883 520,670 (621,084) 553,469
Notes payable - Note 1 3,447,891 -- 2 621,084 4,068,975
------------ ------------ ------------ ------------
Total liabilities 4,101,774 520,670 -- 4,622,444
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY
Capital Stock - Note 1 11,002 9,466 -- 20,468
Additional paid in capital 1,498 399,196 1 (399,196) 1,498
Accumulated deficit (4,108,563) (875,077) 1 397,477 (4,586,163)
Accumulated other comprehensive
income -- (1,719) 1 1,719 --
------------ ------------ ------------ ------------
Total stockholders' equity (4,096,063) (468,134) -- (4,564,197)
------------ ------------ ------------ ------------
Total liabilities and stockholders' equity $ 5,711 $ 52,536 $ -- $ 58,247
============ ============ ============ ============
F-2
IMPULSE MEDIA TECHNOLOGIES INC.
(FORMERLY DENMANS.COM INC.)
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
AUGUST 31, 2001
Pro Forma
DENMANS Pro Forma Consolidated
(as Reported) Impulse Adjustments DENMANS
------------- ------------- ------------- -------------
SALES $ -- $ -- $ -- $ --
Cost of sales 450 -- -- 450
------------- ------------- ------------- -------------
Gross profit (450) -- -- (450)
------------- ------------- ------------- -------------
Expenses
Professional fees -- 148,625 -- 148,625
Amortization -- 322 -- 322
Software development
and web site
development expenses -- 39,924 -- 39,924
Management fees -- 43,777 -- 43,777
Administration expenses 27,772 53,947 -- 81,719
Other Expenses -- 2,791 -- 2,791
------------- ------------- ------------- -------------
Total expenses 27,772 289,386 -- 317,158
------------- ------------- ------------- -------------
Net loss from operations (28,222) (289,386) -- (317,608)
Interest expense (222,648) -- -- (222,648)
Gain on sales of subsidiaries 149,373 -- -- 149,373
------------- ------------- ------------- -------------
Net loss $ (101,497) $ (289,386) $ -- $ (390,883)
============= ============= ============= =============
Loss per share $ (0.01) $ (0.03) $ -- $ (0.02)
============= ============= ============= =============
Weighted average number of
shares outstanding 11,002,000 9,059,440 -- 20,061,440
============= ============= ============= =============
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IMPULSE MEDIA TECHNOLOGIES INC.
(FORMERLY DENMANS.COM INC.)
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
FEBRUARY 28, 2001
October 25,
2000
(Inception)
FEBRUARY 28, through
2001 February 28, Pro Forma
DENMANS 2001 Pro Forma Consolidated
(Predecessor) Impulse Adjustments DENMANS
------------- ------------- ------------- -------------
SALES $ 172,460 $ -- $ -- $ 172,460
Cost of sales 127,035 -- -- 127,035
------------- ------------- ------------- -------------
Gross profit 45,425 -- -- 45,425
Expenses
Marketing and media 342,853 -- -- 342,853
Salaries and benefits 830,038 -- -- 830,038
General and
administration expenses 571,979 6,210 -- 578,189
Professional fees 68,838 32,579 -- 101,417
Management fees 27,372 -- 27,372
Amortization 127,183 -- -- 127,183
Software and website
development expenses 124,350 7,931 -- 132,281
Other expenses 163,826 11,599 -- 175,425
------------- ------------- ------------- -------------
2,229,067 85,691 -- 2,314,758
------------- ------------- ------------- -------------
Net loss from operations 2,183,642 85,691 -- 2,269,333
Interest expense 343,044 -- -- 343,044
------------- ------------- ------------- -------------
Net loss $ (2,526,686) $ (85,691) $ -- $ (2,612,377)
============= ============= ============= =============
Loss per share $ (0.23) $ (0.01) $ -- $ (0.14)
============= ============= ============= =============
Weighted average number of
shares outstanding 11,000,784 7,662,083 -- 18,662,867
============= ============= ============= =============
F-4
IMPULSE MEDIA TECHNOLOGIES INC.
(FORMERLY DENMANS.COM INC.)
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - BASIS OF PRESENTATION
Denmans.com Inc. (the "Company") entered into a stock exchange agreement on
September 5, 2001 with Impulse Media Technologies Inc. ("Impulse"), whereby the
Company acquired 100% ownership of Impulse. As consideration for the purchase of
the Impulse shares, the Company issued one share of its common stock to the
shareholders of Impulse for each common share of the common stock of Impulse
held by them, resulting in the issue of 9,466,083 shares of the common stock of
the Company.
The Company is the obligant under a number of promissory notes (the "Notes"). As
part of the acquisition transaction described above, the Company renegotiated
and extended the maturity dates of the Notes. The Notes and extended maturity
dates are shown below:
NOTE HOLDER EAGLE HARBOUR MANAGEMENT INC. EXTENDED DATES
--------------
i. $500,000 maturing December 8, 2001 March 1, 2003
ii. $500,000 maturing February 15, 2002 April 1, 2003
iii. $500,000 maturing April 12, 2002 May 12, 2003
iv. $500,000 maturing August 20, 2002 July 20, 2003
v. $50,000 maturing September 1, 2002 August 15, 2003
vi. $129,921 maturing October 31, 2002 October 15, 2003
vii. $118,000 maturing November 30, 2002 December 15, 2003
viii. $149,970 maturing December 10, 2002 January 15, 2004
NOTE HOLDER DGD WEALTH MANAGEMENT INC. EXTENDED DATES
--------------
i. $500,000 maturing October 25, 2001 March 1, 2003
ii. $500,000 maturing December 31, 2001 May 1, 2003
- -
NOTE 2 - NEW ACCOUNTING PRONOUNCEMENTS
In July 2001, the Financial Accounting Standards Board issued Statements of
Financial Accounting Standards No. 141, Business Combinations (FAS 141) and
No.142, Goodwill and Other Intangible Assets (FAS 142). FAS 141 requires all
business combinations initiated after June 30, 2001 to be accounted for using
the purchase method. Under FAS 142, goodwill and intangible assets with
indefinite lives are no longer amortized but are reviewed annually (or more
frequently if impairment indicators arise) for impairment. Separable intangible
assets that are not deemed to have indefinite lives will continue to be
amortized over their useful lives (but with no maximum life). The amortization
provisions of FAS 142 apply immediately to goodwill and intangible assets
acquired after June 30, 2001. With respect to goodwill and intangible assets
acquired prior to July 1, 2001, the Company is required to adopt FAS 142
effective March 1, 2002. We are currently evaluating the effect that adoption of
the provisions of FAS 142 will have on our consolidated financial position,
results of operations or disclosures in future periods. The historical financial
statements contained herein do not reflect the provisions of FAS 142; however,
FAS 142 has been applied to the Impulse transaction.
F-5
IMPULSE MEDIA TECHNOLOGIES INC.
(FORMERLY DENMANS.COM INC.)
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 2 - NEW ACCOUNTING PRONOUNCEMENTS, CONTINUED
On October 3, 2001, the FASB issued Statement of Financial Accounting Standards
No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets (FAS
144). FAS 144 supercedes Statements of Financial Accounting Standards No.121,
Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
Be Disposed of. FAS 144 applies to all long-lived assets (including discontinued
operations) and consequently amends Accounting Principles Board Opinion No. 30,
Reporting Results of Operations--Reporting the Effectives of Disposal of a
Segment of a Business. FAS 144 develops one accounting model for long-lived
assets that are to be disposed of by sale. FAS 144 requires that long-lived
assets that are to be disposed of by sale be measured at the lower of book value
or fair value less cost to sell. Additionally, FAS 144 expands the scope of
discontinued operations to include all components of an entity with operations
that (1) can be distinguished from the rest of the entity and (2) will be
eliminated from the ongoing operations of the entity in a disposal transaction.
The Company is required to adopt FAS 144 effective March 1, 2002.
NOTE 3 - PRO FORMA ADJUSTMENTS
1 Reflects elimination of Impulse's equity accounts. No change in stock
because the stock that was issued was for the identical number of
shares originally outstanding in Impulse which had the same par value
of $.001. The fair value of the assets purchased is significantly less
than the fair value to the liabilities assumed resulting in negative
goodwill. The negative goodwill of $477,600 was written off to
accumulated deficit.
2 Reflects changing of interest due to notes payable being reclassified
from short-term to long-term. Notes were renegotiated extending
maturity dates as further described in Note 1.
F-6