AGU Entertainment Corp.
Proforma Condensed Consolidated Statement of Operations (unaudited)
For the nine months ended For the year ended
September 30, 2005 December 31, 2004
As
Actual Adjustments Proforma reported Adjustments Proforma
------ ----------- -------- -------- ----------- --------
(amounts in thousands,
except share data)
Revenues $ 352 $ (99)(1) $ 253 $ 957 $ (50)(1) $ 907
Cost of sales and services performed (57) (21)(2) (37) (124) (16)(2) (108)
-------- ---------- --------- -------- --------- -------
Gross profit 295 216 833 799
Operating expenses 6,513 (141)(3) 6,372 6,420 (137)(4) 6,283
Operating loss (6,219) (6,156) (5,587) (5,484)
Interest expense 5,442 (1,837)(5) 3,605 304 (55)(6) 249
Write off of unamortized debt discount -- 1,833(7) (1,833) -- --
Loss from continuing operations
before income taxes (11,661) (11,594) (5,890) (5,723)
Income tax -- -- -- --
Net loss from continuing operations $(11,661) (11,594) $ (5,890) (5,723)
Loss per share - basic and diluted
from continuing operations $ (0.47) $ (0.47) $ (0.29) $ (0.28)
The proforma adjustments to the historical financial statements are:
(1) Reflects the elimination of revenues attributable to the Lauderdale
Property.
(2) Reflects the elimination of cost of sales attributable to the Lauderdale
Property.
(3) Reflects the elimination of depreciation ($77,000) and operating expenses
($64,000) attributable to the Lauderdale Property.
(4) Reflects the elimination of depreciation ($4,000) and operating expenses
($133,000) attributable to the Lauderdale Property.
(5) Reflects the elimination of interest expense of ($660,000 ), amortization
of deferred finacing fees ($55,000 ) and amortization of debt discount
($1,122,000), for the nine months ended, as a result of the reduction in
notes payable attributable to the Lauderdale Property.
(6) Reflects the elimination of interest expense of ($8,000), amortization of
deferred financing fees ($2,000) and amortization of debt discount
($45,000), for the year ended December 31, 2004, as a result of the
reduction in notes payable attributable to the Lauderdale Property.
(7) Reflects the unamortized discount on certain indebtedness that will be
retired as a result of the sale of the Lauderdale Property.
AGU Entertainment Corp.
Proforma Condensed Consolidated Balance Sheet (unaudited)
(amounts in thousands) At September 30, 2005
As reported Adjustments Proforma
----------- ----------- --------
ASSETS
Current Assets
Cash $ 5 4,155 (1) 4,160
Accounts receivable 501 -- 501
Prepaid expenses 81 -- 81
Assets held for sale 8,847 (8,847)(2) --
---------- ---------- ----------
Total current assets 9,434 (4,692) 4,742
Property and equipment 806 -- 806
Accumulated depreciation (239) -- (239)
---------- ---------- ----------
Property and equipment, net 567 -- 567
Intangibles 1,184 -- 1,184
Other assets 143 -- 143
---------- ---------- ----------
Total assets $ 11,328 $ (4,692) $ 6,636
========== ========== ==========
LIABILITIES & SHAREHOLDERS EQUITY (Deficiency)
Current Liabilities
Accounts payable $ 1,431 -- 1,431
Accounts payable-related parties 339 -- 339
Notes payable-related parties-current portion 1,468 -- 1,468
Convertible notes payable 8,154 (6,750)(4) 1,404
Equipment note-current portion 13 -- 13
Capital leases-ureent portion 8 -- 8
Accrued expenses 1,497 (245)(5) 1,252
Other accrued expenses 8 -- 8
---------- ---------- ----------
Total current liabilities 12,918 (6,995) 5,923
Capital leases, non-current 6 6
Equipment note, non-current 27 27
Convertible notes payable, non-current, net of discount 2,292 (1,167)(4) 1,125
Shareholders equity (deficiency) (3,916) 3,471(3)(6) (445)
---------- ---------- ----------
Total Liabilities and shareholders equity (deficiency) $ 11,328 $ (4,692) $ 6,636
========== ========== ==========
(1) Reflects the net cash proceeds received from the sale of the Lauderdale
Property and includes the amount held in escrow at closing, in the cash
balance.
(2) Reflects the elimination of assets held for sale attributable to the
Lauderdale Property.
(3) Reflects the transaction costs, fees and expenses of $864,650 for the sale
of the Lauderdale Property.
(4) Reflects the approximate use of $9.75 million of proceeds to repay
indebtedness, net of $1,833,000 of debt discount.
(5) Reflects the approximate use of $245,480 of proceeds to pay accrued
interest.
(6) Reflects the estimated gain ($5.3 million) on the sale of the Lauderdale
Property and loss on the extinguishment of debt ($1.8 million).