EX-1.02 3 f8ka040918_ex1z02.htm EXHIBIT 1.02 PRO FORMA FINANCIAL INFORMATION Exhibit 1.02 Pro Forma Financial Information

 

NORTHSIGHT CAPITAL, INC.

UNAUDITED PRO FORMA COMBINED BALANCE SHEET

December 31, 2017

 

 

 

Northsight Capital,

Inc.

 

 

Crush Mobile, LLC

 

 

Combined

Before

Pro

Forma

Adjustments

 

 

Pro Forma

Adjustments

 

 

Northsight Capital,

Inc.

Pro Forma

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash

 

$

612

 

 

$

7,272

 

 

$

7,884

 

 

$

-

 

 

$

7,884

 

Prepaid expenses

 

 

291,781

 

 

 

-

 

 

 

291,781

 

 

 

-

 

 

 

291,781

 

Accounts receivable

 

 

15,000

 

 

 

-

 

 

 

15,000

 

 

 

-

 

 

 

15,000

 

Total current assets

 

 

307,393

 

 

 

7,272

 

 

 

314,665

 

 

 

-

 

 

 

314,665

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment in Crush Mobile

 

 

-

 

 

 

-

 

 

 

-

 

 

 

382,512

(a)

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(382,512)

(c)

 

 

 

 

Goodwill

 

 

-

 

 

 

-

 

 

 

-

 

 

 

459,650

(d)

 

 

459,650

 

Web development costs - net

 

 

104,597

 

 

 

-

 

 

 

104,597

 

 

 

-

 

 

 

104,597

 

Total assets

 

$

411,990

 

 

$

7,272

 

 

$

419,262

 

 

$

459,650

 

 

$

878,912

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Liabilities and Stockholders' Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts payable and accrued expenses

 

$

219,800

 

 

$

22,879

 

 

$

242,679

 

 

$

-

 

 

$

242,679

 

Accounts payable and accrued expenses – related party

 

 

878,400

 

 

 

-

 

 

 

878,400

 

 

 

-

 

 

 

878,400

 

Notes payable – related party

 

 

2,000,293

 

 

 

380,000

 

 

 

2,380,293

 

 

 

(300,000)

(b)

 

 

2,080,293

 

Notes payable

 

 

79,900

 

 

 

-

 

 

 

79,900

 

 

 

-

 

 

 

79,900

 

Total Current Liabilities

 

 

3,178,393

 

 

 

402,879

 

 

 

3,581,272

 

 

 

(300,000)

 

 

 

3,281,272

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Long Term Liabilities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Notes payable – related party

 

 

400,000

 

 

 

-

 

 

 

400,000

 

 

 

-

 

 

 

400,000

 

Total Liabilities

 

 

3,578,393

 

 

 

402,879

 

 

 

3,981,272

 

 

 

(300,000)

 

 

 

3,681,242

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stockholders' Deficit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common stock, par value

 

 

121,018

 

 

 

-

 

 

 

121,018

 

 

 

4,904

(a)

 

 

128,922

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3,000

(b)

 

 

 

 

Owners’ Equity

 

 

-

 

 

 

1,488,256

 

 

 

1,488,256

 

 

 

(1,448,256)

(a)

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional paid-in capital

 

 

18,638,874

 

 

 

-

 

 

 

18,638,874

 

 

 

1,825,364

(a)

 

 

20,735,738

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

231,000

(b)

 

 

 

 

Accumulated deficit

 

 

(21,926,295)

 

 

 

(1,883,863)

 

 

 

(23,810,158)

 

 

 

66,000

(b)

 

 

(23,667,020)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

77,138

(c)

 

 

 

 

Total Stockholders' Deficit

 

 

(3,166,403)

 

 

 

(395,607)

 

 

 

(3,562,010

)

 

 

759,650

 

 

 

(2,802,360)

 

Total Liabilities and Stockholders' Deficit

 

$

411,990

 

 

$

7,272

 

 

$

419,262

 

 

$

459,650

 

 

$

878,912

 

NORTHSIGHT CAPITAL, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

Year Ended December 31, 2017

 

 

 

Northsight Capital, Inc.

 

 

Crush Mobile, LLC

 

 

Combined

Before

Pro

Forma

Adjustments

 

 

Pro Forma

Adjustments

 

 

Northsight Capital, Inc.

Pro Forma

 

Revenue

 

$

20,100

 

 

$

51,106

 

 

$

71,206

 

 

$

-

 

 

$

71,206

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

 

732,071

 

 

 

14,579

 

 

 

746,650

 

 

 

-

 

 

 

746,650

 

Information technology services

 

 

-

 

 

 

138,825

 

 

 

138,825

 

 

 

-

 

 

 

138,825

 

Consulting expense – related party

 

 

180,000

 

 

 

-

 

 

 

180,000

 

 

 

-

 

 

 

180,000

 

Professional fees

 

 

234,713

 

 

 

18,650

 

 

 

253,363

 

 

 

-

 

 

 

253,363

 

Rent – related party

 

 

69,000

 

 

 

-

 

 

 

69,000

 

 

 

-

 

 

 

69,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from operations

 

 

(1,195,684)

 

 

 

(120,948)

 

 

 

(1,316,632)

 

 

 

-

 

 

 

(1,316,632)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net operating Loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss on investment

 

 

(17,361)

 

 

 

-

 

 

 

(17,361)

 

 

 

-

 

 

 

(17,361)

 

Interest expense

 

 

(69,909)

 

 

 

-

 

 

 

(69,909)

 

 

 

-

 

 

 

(69,909)

 

Gain on settlement of debt

 

 

45,867

 

 

 

-

 

 

 

45,867

 

 

 

-

 

 

 

45,867

 

Loss on extinguishment of debt

 

 

(5,798)

 

 

 

-

 

 

 

(5,798)

 

 

 

-

 

 

 

(5,798)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss from operations

 

 

(1,242,885)

 

 

 

(120,948)

 

 

 

(1,363,833)

 

 

 

-

 

 

 

(1,363,833)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss

 

$

(1,242,885)

 

 

$

(120,948)

 

 

$

(1,363,833)

 

 

$

-

 

 

$

(1,363,833)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share – basic and diluted

 

 

(0.01)

 

 

 

 

 

 

 

(.01)

 

 

 

 

 

 

 

(.01)

 

Weighted average number of common shares outstanding during the period – basic and diluted

 

 

115,813,660

 

 

 

 

 

 

 

115,813,660

 

 

 

7,904,000

(d)

 

 

123,717,660

 

NORTHSIGHT CAPITAL, INC.

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATIONS

Year ended December 31, 2016

 

 

 

Northsight Capital, Inc.

 

 

Crush Mobile, LLC

 

 

Combined

Before

Pro

Forma

Adjustments

 

 

Pro Forma

Adjustments

 

 

Northsight Capital, Inc.

Pro Forma

 

Revenue

 

$

15,680

 

 

$

78,903

 

 

$

94,583

 

 

$

-

 

 

$

94,583

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating Expenses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative

 

 

773,037

 

 

 

277,563

 

 

 

1,050,600

 

 

 

-

 

 

 

1,050,600

 

Information technology services

 

 

-

 

 

 

354,552

 

 

 

354,552

 

 

 

-

 

 

 

354,552

 

Consulting expense – related party

 

 

180,000

 

 

 

-

 

 

 

180,000

 

 

 

-

 

 

 

180,000

 

Professional fees

 

 

212,815

 

 

 

57,716

 

 

 

270,531

 

 

 

-

 

 

 

270,531

 

Rent – related party

 

 

134,400

 

 

 

12,895

 

 

 

147,295

 

 

 

-

 

 

 

147,295

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss from operations

 

 

(1,284,572)

 

 

 

(623,823)

 

 

 

(1,908,395)

 

 

 

-

 

 

 

(1,908,395)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net operating Loss

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss on investment

 

 

(475,751)

 

 

 

-

 

 

 

(475,751)

 

 

 

-

 

 

 

(475,751)

 

Loss from equity investment

 

 

(10,695)

 

 

 

-

 

 

 

(10,695)

 

 

 

-

 

 

 

(10,695)

 

Interest expense

 

 

(63,063)

 

 

 

-

 

 

 

(63,063)

 

 

 

-

 

 

 

(63,063)

 

Loss on deposit

 

 

(131,000)

 

 

 

-

 

 

 

(131,000)

 

 

 

-

 

 

 

(131,000)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss from operations

 

 

(1,965,081)

 

 

 

(623,823)

 

 

 

(2,588,904)

 

 

 

-

 

 

 

(2,588,904)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Loss

 

$

(1,965,081)

 

 

$

(623,823)

 

 

$

(2,588,904)

 

 

$

-

 

 

$

(2,588,904)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net loss per share – basic and diluted

 

 

(0.02)

 

 

 

 

 

 

 

(0.02)

 

 

 

 

 

 

 

(0.02)

 

Weighted average number of common shares outstanding during the period – basic and diluted

 

 

112,818,088

 

 

 

 

 

 

 

112,818,088

 

 

 

7,904,000

(d)

 

 

120,722,088

 

NOTE 1 - BASIS OF PRO FORMA PRESENTATION

 

The unaudited pro forma condensed combined financial statements have been prepared assuming that the acquisition is accounted for using the acquisition method of accounting. Accordingly, the assets acquired and liabilities assumed of the Seller are recorded at their fair value.

 

NOTE 2 – PROPOSED TRANSACTION

 

On January 8, 2018, the Registrant (the “Company”) completed the acquisition of Crush Mobile, LLC (“Crush Mobile”) from its members.

 

Crush Mobile’s assets consist primarily of trademarks, domain names, mobile dating applications and related software and intellectual property. In connection with the closing of the acquisition, the Registrant is issuing an aggregate of 7,904,000 shares of common stock as follows: (i) 4,904,000 shares to the Crush Mobile members and (ii) 3,000,000 shares to certain Crush Mobile creditors (who are also members) in full satisfaction of $300,000 of indebtedness owed to them by Crush Mobile.

 

NOTE 3 – PRELIMINARY PURCHASE PRICE ALLOCATION

 

The Company has performed a preliminary valuation analysis of the fair market value of Crush Mobile, LLC’s assets and liabilities. The following table summarizes the allocation of the preliminary purchase price as of the acquisition date:

 

Purchase Price

 

 

4,904,000 shares of common stock valued at $0.078 per share

 

$

382,512

 

 

 

 

Allocation of Purchase Price

 

 

 

Cash

 

$

5,812

Goodwill

 

 

459,650

Accounts payable

 

 

(2,950)

Debt Obligations

 

 

(80,000)

 

 

$

382,512

 

NOTE 4 - PRO FORMA PRESENTATION ADJUSTMENTS AND ASSUMPTIONS

 

The adjustments included in the column under the heading "Pro Forma Adjustments" in the unaudited pro forma condensed combined financial statements are as follows:

 

Pro Forma Adjustments to the Condensed Combined Balance Sheet

 

(a)To record the issuance of 4,904,000 shares of Northsight Capital common stock issued to shareholders of Crush Mobile in exchange for their ownership shares. 

 

(b)To record the issuance of 3,000,000 shares of Northsight Capital common stock issued to debtholders of Crush Mobile as payment of an aggregate $300,000 in outstanding debt. 

 

(c)To record the elimination of the historical members deficit of Crush Mobile 

 

 

Pro Forma Adjustments to the Condensed Combined Statements of Operations

 

(d)To record the issuance of an aggregate 7,904,000 shares of Northsight Capital common stock attributable to the acquisition agreement