Pro forma financial information
EXHIBIT 99.2
Pro forma financial information
On February 10, 2014, the Company (fka ePunk, Inc.) (the "Legal Acquirer") entered into a Share Exchange Agreement ("Merger") with Blink Technologies, Inc., ("Blink Technologies", “Accounting Acquirer”) whereby the Company issued 24,000,000 shares of common stock representing 54.98% of the post-closing issued and outstanding shares in exchange for all 75,000,000 issued and outstanding common shares of Blink Technologies. As a result, the Company (i) became the 100% parent of Blink Technologies; (ii) assumed the operations of Blink Technologies; (iii) changed its name from ePunk, Inc. to Blink Technologies, Inc.; (iv) dissolved the original Blink Technologies, Inc. Nevada entity; and (v) experienced a change in control. The terms and conditions of the Merger give rise to reverse merger accounting whereby Blink Technologies is deemed the acquirer for accounting purposes. Consequently, the assets and liabilities and the historical operations of Blink Technologies prior to the Merger are reflected in the financial statements and have been recorded at the historical cost basis of Blink Technologies. Our financial statements include the assets and liabilities of both the Company and Blink Technologies. The merger was accounted for under recapitalization accounting whereby the equity of Blink Technologies is presented as the equity of the combined enterprise and the capital stock account of Blink Technologies is adjusted to reflect the par value of the outstanding stock of the Legal Acquirer after giving effect to the number of shares issued in the business combination (19,950,602 shares). Shares retained by the Legal Acquirer (19,950,602 shares) are reflected as an issuance as of the reverse merger date (February 10, 2014) for the historical amount of the net liabilities of the Company.
The following unaudited financial information has been developed by application of pro forma adjustments to the historical financial statements of Blink Technologies appearing elsewhere in this Current Report. The unaudited pro forma information gives effect to the Merger which has been assumed to have occurred on February 10, 2014 for purposes of the statement of operations. The Company evaluated the existence of intangible assets that should be recognized in business combinations, pursuant to ASC 805-20-25-4. No intangible assets were identified.
The unaudited pro forma financial information is presented for informational purposes only and does not purport to represent what the results of operations or financial position of the Company would have been had the transactions described above actually occurred on the dates indicated, nor do they purport to project the financial condition of the Company for any future period or as of any future date. The unaudited pro forma financial information should be read in conjunction with the Company's financial statements and notes thereto included elsewhere in this Current Report.
The condensed pro forma results of operations for the three months ended December 31, 2013 and year ended September 30, 2013 are as follows:
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1
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Unaudited Pro Forma Statements of Operations |
| Three Months Ended | Year Ended | |||||||||||||||||||||||||
| December 31, 2013 | September 30, 2013 | |||||||||||||||||||||||||
| Blink | Blink (fka | Blink | Blink (fka | |||||||||||||||||||||||
| Technologies | ePunk, Inc.) | Technologies | ePunk, Inc.) | |||||||||||||||||||||||
| Actual | Actual | Pro Forma | Actual | Actual | Pro Forma | |||||||||||||||||||||
|
REVENUES |
||||||||||||||||||||||||||
|
Net sales |
$ |
23,155 |
$ |
- |
$ |
23,155 |
$ |
- |
$ |
- |
$ |
- |
||||||||||||||
|
Cost of revenue |
25,800 |
- |
25,800 |
31,428 |
- |
31,428 |
||||||||||||||||||||
|
Gross profit (loss) |
(2,645 |
) |
- |
(2,645 |
) |
(31,428 |
) |
- |
(31,428 |
) |
||||||||||||||||
|
Operating expenses |
74,812 |
7,968 |
82,780 |
774,200 |
242,839 |
1,017,039 |
||||||||||||||||||||
|
Loss from operations |
(77,457 |
) |
(7,968 |
) |
(85,425 |
) |
(805,628 |
) |
(242,839 |
) |
(1,048,467 |
) |
||||||||||||||
|
Non-operating income (expense): |
||||||||||||||||||||||||||
|
Interest expense |
- |
(9,978 |
) |
(9,978 |
) |
- |
(31,443 |
) |
(31,443 |
) |
||||||||||||||||
|
Interest expense - accretion of debt discount |
- |
(58,852 |
) |
(58,852 |
) |
- |
(152,134 |
) |
(152,134 |
) |
||||||||||||||||
|
Loss on share issuance |
- |
- |
- |
- |
- |
- |
||||||||||||||||||||
|
Debt settlement - related party |
- |
- |
- |
(75,000 |
) |
- |
(75,000 |
) |
||||||||||||||||||
|
Total non-operating expense |
- |
(68,830 |
) |
(68,830 |
) |
(75,000 |
) |
(183,577 |
) |
(258,577 |
) |
|||||||||||||||
|
Loss on continuing operations |
$ |
(77,457 |
) |
$ |
(76,798 |
) |
$ |
(154,255 |
) |
$ |
(880,628 |
) |
$ |
(426,416 |
) |
$ |
(1,307,044 |
) |
||||||||
|
Gain (loss) on discontinued operations |
- |
226,585 |
226,585 |
- |
(643,453 |
) |
(643,453 |
) |
||||||||||||||||||
|
Net income (loss) |
$ |
(77,457 |
) |
$ |
149,787 |
$ |
72,330 |
$ |
(880,628 |
) |
$ |
(1,069,869 |
) |
$ |
(1,950,497 |
) |
||||||||||
|
Common shares outstanding: |
||||||||||||||||||||||||||
|
Basic shares outstanding |
24,000,000 |
24,000,000 |
2) |
24,000,000 |
24,000,000 |
|||||||||||||||||||||
|
Shares to be issued for acquisition |
19,950,602 |
19,950,602 |
1) |
19,950,602 |
19,950,602 |
|||||||||||||||||||||
|
Total common shares outstanding |
43,950,602 |
43,950,602 |
||||||||||||||||||||||||
|
Net income (loss) per common share - basic |
$ |
0.002 |
$ |
(0.044 |
) |
|||||||||||||||||||||
|
1) |
Represents ePunk, Inc. pre merger shares outstanding. |
||||||||||||
|
2) |
Represents the shares issued in the Merger. |
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2
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The condensed pro forma balance sheet as of September 30, 2013 is as follows:
|
Unaudited Pro Forma Balance Sheet |
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|
As of September 30, 2013 |
| Blink (fka | Blink | |||||||||||||||||
| ePunk, Inc.) | Technologies | Merger | ||||||||||||||||
| Actual | Actual | Adjustments | Pro Forma | |||||||||||||||
|
|
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|
ASSETS |
||||||||||||||||||
|
Current assets: |
||||||||||||||||||
|
Cash |
$ |
1,951 |
$ |
51 |
$ |
- |
$ |
2,002 |
||||||||||
|
Accounts receivable |
- |
- |
- |
- |
||||||||||||||
|
Assets from discontinued operations |
17,210 |
- |
- |
17,210 |
||||||||||||||
|
Total current assets |
19,161 |
51 |
- |
19,212 |
||||||||||||||
|
Assets from discountinued opeartions |
30,139 |
- |
- |
30,139 |
||||||||||||||
|
Total assets |
$ |
49,300 |
$ |
51 |
$ |
- |
$ |
49,351 |
||||||||||
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LIABILITIES AND STOCKHOLDERS' DEFICIT |
||||||||||||||||||
|
Current liabilities: |
||||||||||||||||||
|
Accounts payable and accrued liabilities |
$ |
19,323 |
$ |
72,115 |
$ |
- |
$ |
91,438 |
||||||||||
|
Accounts payable - related party |
- |
11,533 |
11,533 |
|||||||||||||||
|
Accrued interest |
40,182 |
- |
- |
40,182 |
||||||||||||||
|
Convertible notes payable |
344,809 |
- |
- |
344,809 |
||||||||||||||
|
Promissory note |
100,000 |
- |
- |
100,000 |
||||||||||||||
|
Liabilities from discontinued operations |
379,332 |
- |
- |
379,332 |
||||||||||||||
|
Total current liabilities |
883,646 |
83,648 |
- |
967,294 |
||||||||||||||
|
Total liabilities |
883,646 |
83,648 |
- |
967,294 |
||||||||||||||
|
Commitments and contingencies |
||||||||||||||||||
|
Stockholders' deficit: |
||||||||||||||||||
|
Common stock |
1,995 |
75,005 |
(72,605 |
) |
4,395 |
|||||||||||||
|
Additional paid-in capital |
1,385,250 |
3,365,593 |
(2,148,986 |
) |
2,601,857 |
|||||||||||||
|
Accumulated deficit |
(2,221,591 |
) |
(3,524,195 |
) |
2,221,591 |
(3,524,195 |
) |
|||||||||||
|
Total stockholders' deficit |
(834,346 |
) |
(83,597 |
) |
- |
(917,943 |
) |
|||||||||||
|
Total liabilities and stockholder's deficit |
$ |
49,300 |
$ |
51 |
$ |
- |
$ |
49,351 |
||||||||||
|
1) |
We have accounted for the Merger under recapitalization accounting whereby the equity of Blink Technologies (Accounting Acquirer) should be presented as the equity of the combined enterprise. The capital stock account of Blink Technologies is adjusted to reflect the par value of the outstanding stock of the Legal Acquirer (Blink (fka ePunk, Inc.)) after giving effect to the number of shares issued in the business combination (19,950,602 shares). Shares retained by the Legal Acquirer (Blink (fka ePunk, Inc.) 19,950,602 shares) are reflected as an issuance as of the reverse merger date (February 10, 2014) for the historical amount of the net equity of Blink, which is in this case is a net liability of $834,346 plus the par value of the shares issued or $1,995. |
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