HOME TOUCH HOLDING COMPANY Unaudited Pro forma Financial Information
Exhibit 99.3
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Unaudited Pro forma Financial Information
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1
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NOTES TO UNAUDITED PRO FORMA CONDENSED
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COMBINED FINANCIAL INFORMATION
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(Currency expressed in United States Dollars (“US$”))
On December 6, 2010, Home Touch Holding Company (“the Company” or “HMTO”)) entered into an agreement for the purchase of all the outstanding shares of common stock of Union Hub Technology Sdn. Bhd. (“Union Hub”, a company incorporated under the laws of Malaysia), by issuing 16,500,000 shares of common stock of the Company to the shareholders of Union Hub. This share exchange transaction resulted in the shareholders of Union Hub obtaining a majority voting interest in the Company. Accounting principles generally accepted in the United States of America (“US GAAP”) require that the company whose shareholders retain the majority interest in a combined entity being treated as the acquirer for accounting purposes, resulting in a reverse acquisition. Accordingly, the stock exchange transaction has been accounted for as recapitalization of HMTO.
Concurrently, on December 6, 2010, the Company entered into and closed an agreement to sell its wholly-owned subsidiary, Home Touch Limited (a corporation incorporated under the laws of the Hong Kong Special Administrative Region), to the related companies which are controlled by Xxxxx Xxxxxxx Xx and Xxxxxx Xxx Xxx, the former founders, executive officers and directors and shareholders of the Company for cash consideration of $20,000.
The following unaudited pro forma condensed consolidated balance sheet as of March 31, 2010 and the unaudited pro forma condensed consolidated statement of operations are derived from the historical financial statements of the Company and Union Hub and have been prepared to give effect to the reverse acquisition of the Company and Union Hub as at March 31, 2010. The unaudited pro forma condensed consolidated balance sheet is presented as if the reverse acquisition and disposal of a subsidiary had occurred as of March 31, 2010. The unaudited pro forma condensed consolidated statement of operations is presented as if the reverse acquisition and disposal of a subsidiary by HMTO had occurred on April 1, 2009 and 2010.
The following unaudited pro forma condensed consolidated financial statements have been prepared for illustrative purposes only and do not purport to reflect the results the combined company may achieve in future periods or the historical results that would have been obtained. These unaudited pro forma condensed consolidated financial statements, including the notes hereto, should be read in conjunction with (i) the historical consolidated financial statements for the Company included in its Form 10-K filed on June 29, 2010 and (ii) the historical financial statements of Union Hub included in the Company’s Form 8-K dated December 6, 2010.
2
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
AS OF MARCH 31, 2010
(Currency expressed in United States Dollars (“US$”))
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HMTO
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Union
Hub
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Proforma
Adjustment (1)
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Proforma
Adjustment (2)
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Pro forma
consolidated
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ASSETS
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Current assets:
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Cash and cash equivalents
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$ | 483,684 | $ | 49 | (483,684 | ) | - | $ | 49 | |||||||||||
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Accounts receivable
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5,115 | - | (5,115 | ) | - | - | ||||||||||||||
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Amounts due from related parties
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6,414 | - | (6,414 | ) | - | - | ||||||||||||||
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Inventories, net
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51,972 | - | (51,972 | ) | - | - | ||||||||||||||
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Deposits and other current assets
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54,725 | - | (54,725 | ) | - | - | ||||||||||||||
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Total current assets
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601,910 | 49 | (601,910 | ) | - | 49 | ||||||||||||||
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Non-current assets:
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Plant and equipment, net
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13,142 | - | (13,142 | ) | - | - | ||||||||||||||
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TOTAL ASSETS
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$ | 615,052 | $ | 49 | (615,052 | ) | - | $ | 49 | |||||||||||
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LIABILITIES AND STOCKHOLDERS’ EQUITY
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Current liabilities:
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Accounts payable
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$ | 1,713 | $ | - | (1,713 | ) | - | $ | - | |||||||||||
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Customer deposit
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206,275 | - | (206,275 | ) | - | - | ||||||||||||||
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Customer deposit from related parties
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22,154 | - | (22,154 | ) | - | - | ||||||||||||||
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Current portion of long-term bank loan
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50,764 | - | (50,764 | ) | - | - | ||||||||||||||
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Accounts payable and accrued liabilities
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126,908 | 1,289 | (126,908 | ) | - | 1,289 | ||||||||||||||
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Total current liabilities
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407,814 | 1,289 | (407,814 | ) | - | 1,289 | ||||||||||||||
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Non-current liabilities:
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Long-term bank loan
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62,855 | - | (62,855 | ) | - | - | ||||||||||||||
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Total liabilities
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470,669 | 1,289 | (470,669 | ) | - | 1,289 | ||||||||||||||
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Stockholders’ equity:
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Preferred stock
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- | - | - | - | - | |||||||||||||||
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Common stock
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2,000 | 1 | - | 16,499 | 18,500 | |||||||||||||||
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Additional paid in capital
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577,394 | - | (522,178 | ) | (55,216 | ) | - | |||||||||||||
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Accumulated other comprehensive income
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- | (65 | ) | - | - | (65 | ) | |||||||||||||
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Accumulated deficit
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(435,011 | ) | (1,176 | ) | 377,795 | 38,717 | (19,675 | ) | ||||||||||||
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Total stockholders’ equity (deficit)
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144,383 | (1,240 | ) | (144,383 | ) | - | (1,240 | ) | ||||||||||||
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TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
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$ | 615,052 | $ | 49 | (615,052 | ) | - | $ | 49 | |||||||||||
3
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE YEAR ENDED MARCH 31, 2010
(Currency expressed in United States Dollars (“US$”), except for number of shares)
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HMTO
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Union
Hub
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Proforma
Adjustment (1)
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Proforma
Adjustment (2)
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Pro forma
Consolidated
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Revenue, net
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$ | 842,726 | $ | - | (842,726 | ) | - | $ | - | |||||||||||
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Cost of revenue
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(351,790 | ) | - | 351,790 | - | - | ||||||||||||||
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Gross profit
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490,936 | - | (490,936 | ) | - | - | ||||||||||||||
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Operating expenses:
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General and administrative
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(408,907 | ) | (494 | ) | 408,907 | - | (494 | ) | ||||||||||||
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(Loss) income from operation
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82,029 | (494 | ) | (82,029 | ) | - | (494 | ) | ||||||||||||
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Other income (expenses):
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Other income
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5 | - | (5 | ) | - | - | ||||||||||||||
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Other expense
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(6,826 | ) | - | 6,826 | - | - | ||||||||||||||
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(Loss) income before income taxes
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75,208 | (494 | ) | (75,208 | ) | - | (494 | ) | ||||||||||||
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Income tax expense
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- | - | - | - | - | |||||||||||||||
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NET (LOSS) INCOME
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$ | 75,208 | $ | (494 | ) | (75,208 | ) | - | $ | (494 | ) | |||||||||
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Net loss per share – basic and diluted
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$ | (0.00 | ) | |||||||||||||||||
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Weighted average number of common stock – basic and diluted
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18,500,000 | |||||||||||||||||||
4
UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2010
(Currency expressed in United States Dollars (“US$”), except for number of shares)
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HMTO
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Union Hub
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Proforma
Adjustment (1)
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Proforma
Adjustment (2)
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Pro forma
Combined
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Revenue, net
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$ | 160,733 | $ | 288,824 | (160,733 | ) | - | $ | 288,824 | |||||||||||
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Cost of revenue
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(103,230 | ) | (172,958 | ) | 103,230 | - | (172,958 | ) | ||||||||||||
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Gross profit
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57,503 | 115,866 | (57,503 | ) | - | 115,866 | ||||||||||||||
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Operating expenses:
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General and administrative
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(178,525 | ) | (64,916 | ) | 178,525 | - | (64,916 | ) | ||||||||||||
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(Loss) income from operation
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(121,022 | ) | 50,950 | 121,022 | - | 50,950 | ||||||||||||||
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Other income (expenses):
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Realised gain on marketable securities
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746 | - | (746 | ) | - | - | ||||||||||||||
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Interest income
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2 | - | (2 | ) | - | |||||||||||||||
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Interest expense
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(1,507 | ) | (313 | ) | 1,507 | - | (313 | ) | ||||||||||||
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(Loss) income before income taxes
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(121,781 | ) | 50,637 | 121,781 | - | 50,637 | ||||||||||||||
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Income tax expense
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- | (10,127 | ) | - | - | (10,127 | ) | |||||||||||||
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NET (LOSS) INCOME
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$ | (121,781 | ) | $ | 40,510 | 121,781 | - | $ | 40,510 | |||||||||||
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Net income per share – basic and diluted
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$ | 0.00 | ||||||||||||||||||
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Weighted average number of common stock – basic and diluted
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20,000,000 | |||||||||||||||||||
5
NOTES TO UNAUDITED PRO FORMA CONDENSED
CONSOLIDATED FINANCIAL INFORMATION
(Currency expressed in United States Dollars (“US$”))
NOTE1-PRO FORMA ADJUSTMENTS
These unaudited pro forma condensed consolidated financial statements reflect the following pro forma adjustments:
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1.
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To record the disposal of Home Touch Limited, a wholly-owned subsidiary of HMTO at its carrying values and transfer to the related companies which are controlled by Xxxxx Xxxxxxx Xx and Xxxxxx Xxx Xxx, the former founders, executive officers and directors and shareholders of the Company for cash consideration of $20,000. All of HMTO’s assets and liabilities contributed by its subsidiary, Home Touch Limited. Upon the disposal, HMTO has no assets and liabilities on its balance sheet.
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2a.
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To eliminate the accumulated deficit of HMTO as Union Hub is considered as the continuing entity as accounting acquirer for accounting purposes.
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2b.
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To record the issuance of 16,500,000 shares of the common stock of HMTO at par value of $0.001 in exchange for all equity interest in Union Hub.
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6
