eos_ex102.htm

EXHIBIT 10.2

 

EOS INC. AND SUBSIDIARY

UNAUDITED PRO FORMA FINANCIAL INFORMATION

 

The following unaudited pro forma condensed consolidated balance sheet at December 31, 2016 of EOS Inc. (“EOS”) gives effect to the acquisition of Emperor Star International Trade Co., Ltd. (“Emperor Star”) completed on May 3, 2017 as if it had occurred on December 31, 2016. The following unaudited pro forma consolidated statement of operations for the year ended December 31, 2016 was prepared assuming that the transaction described above was consummated as of the beginning of the periods presented.

 

Such unaudited pro forma financial information is based on the historical consolidated financial statements of EOS and Emperor Star and certain adjustments which EOS believes to be reasonable, to give effect of the acquisition, which are described in the notes to the statements below.

 

The unaudited pro forma financial information:

 


	
 
	
•
	
does not purport to represent what the consolidated results of operations actually would have been if the acquisition of Emperor Star had occurred on the beginning of the periods presented or what those results will be for any future periods or what the consolidated balance sheet would have been if the acquisition of the Emperor Star had occurred on December 31, 2016. 

			
	
 
	
•
	
has not been adjusted to reflect any matters not directly attributable to implementing the acquisition of Emperor Star. No adjustment, therefore, has been made for actions which may be taken once the acquisition was completed, such as any of our integration plans related to Emperor Star. As a result, the actual amounts recorded in the consolidated financial statements of EOS will differ from the amounts reflected in the unaudited pro forma financial statements, and the differences may be material. 




 


	 
	
	

 
	 



 


	
EOS INC. AND SUBSIDIARY

	
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET

	
AS OF DECEMBER 31, 2016

	
 
	
 
		
 
	
 
		
 
	
 
		
 
	
 
		
 
		
 

	
 
	
 
	
Historical
	
 
	
 
	
Historical
	
 
	
 
	
Pro Forma
	
 
	
 
	
Note
	
 
	
Combined 
	
 

	
 
	
 
	
EOS Inc.
	
 
	
 
	
Emperor Star
	
 
	
 
	
Adjustment
	
 
	
 
	
 
	
 
	
Pro Forma 
	
 

	
Assets

	
Current Assets
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Cash and cash equivalents
	
 
	$	35,696	
 
	
 
	$	6,390	
 
	
 
	$	(30,562	)	
 
	
(a) 
	
 
	$	11,524	
 

	
Inventory
	
 
	
 
	-	
 
	
 
	
 
	1,919	
 
	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	1,919	
 

	
Prepaid and other current assets
	
 
	
 
	82	
 
	
 
	
 
	6,229	
 
	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	6,311	
 

	
Total Current Assets
	
 
	
 
	35,778	
 
	
 
	
 
	14,538	
 
	
 
	
 
	(30,562	)	
 
	
 
	
 
	
 
	19,754	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Fixed assets, net
	
 
	
 
	-	
 
	
 
	
 
	3,180	
 
	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	3,180	
 

	
Deposits
	
 
	
 
	-	
 
	
 
	
 
	2,544	
 
	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	2,544	
 

	
Total Assets
	
 
	$	35,778	
 
	
 
	$	20,262	
 
	
 
	$	(30,562	)	
 
	
 
	
 
	$	25,478	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Liabilities and Stockholders' Equity

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Current Liabilities
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Accounts payable
	
 
	$	-	
 
	
 
	$	2,778	
 
	
 
	$	-	
 
	
 
	
 
	
 
	$	2,778	
 

	
Accrued expenses
	
 
	
 
	13,517	
 
	
 
	
 
	10,572	
 
	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	24,089	
 

	
Due to shareholders
	
 
	
 
	175,912	
 
	
 
	
 
	57,405	
 
	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	233,317	
 

	
Unearned revenues
	
 
	
 
	
 
	
 
	
 
	
 
	34,797	
 
	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	34,797	
 

	
Total Current Liabilities
	
 
	
 
	189,429	
 
	
 
	
 
	105,552	
 
	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	294,981	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Stockholders' Equity
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 Common stock
	
 
	
 
	64,123	
 
	
 
	
 
	30,562	
 
	
 
	
 
	(30,562	)	
 
	
(a)
	
 
	
 
	64,123	
 

	
 Additional paid-in capital
	
 
	
 
	90,000	
 
	
 
	
 
	-	
 
	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	90,000	
 

	
 Other comprehensive income
	
 
	
 
	(120	)	
 
	
 
	660	
 
	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	540	
 

	
 Accumulated deficit
	
 
	
 
	(307,654	)	
 
	
 
	(116,512	)	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	(424,166	)
	
Total Stockholders' Equity
	
 
	
 
	(153,651	)	
 
	
 
	(85,290	)	
 
	
 
	(30,562	)	
 
	
 
	
 
	
 
	(269,503	)
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Total Liabilities and Stockholders' Equity
	
 
	$	35,778	
 
	
 
	$	20,262	
 
	
 
	$	(30,562	)	
 
	
 
	
 
	$	25,478	
 




 


	 
	
	

 
	 



 


	
EOS INC. AND SUBSIDIARY

	
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIOINS 

	
FOR THE YEAR ENDED DECEMBER 31, 2016

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
 
	
 
	
Historical
	
 
	
 
	
Historical
	
 
	
 
	
Pro Forma
	
 
	
 
	
Note
	
 
	
Combined
	
 

	
 
	
 
	
EOS Inc.
	
 
	
 
	
Emperor Star
	
 
	
 
	
Adjustment
	
 
	
 
		
 
	
Pro Forma
	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Net revenue
	
 
	$	-	
 
	
 
	$	281,111	
 
	
 
	$	-	
 
	
 
	
 
	
 
	$	281,111	
 

	
Cost of goods sold
	
 
	
 
	-	
 
	
 
	
 
	131,232	
 
	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	131,232	
 

	
Gross Profit
	
 
	
 
	-	
 
	
 
	
 
	149,879	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	149,879	
 

	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Selling, general and administrative expenses
	
 
	
 
	157,718	
 
	
 
	
 
	243,555	
 
	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	401,273	
 

	
Operating loss
	
 
	
 
	(157,718	)	
 
	
 
	(93,676	)	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	(251,394	)
	
Total other income (expense)
	
 
	
 
	55	
 
	
 
	
 
	(6,144	)	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	(6,089	)
	
Loss before income tax
	
 
	
 
	(157,663	)	
 
	
 
	(99,820	)	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	(257,483	)
	
Income taxes
	
 
	
 
	-	
 
	
 
	
 
	-	
 
	
 
	
 
	-	
 
	
 
	
 
	
 
	
 
	-	
 

	
Net loss
	
 
	$	(157,663	)	
 
	$	(99,820	)	
 
	$	-	
 
	
 
	
 
	
 
	
 
	(257,483	)
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Loss per share - basic and diluted
	
 
	$	(0.00	)	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	$	(0.00	)
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 

	
Weighted average number of common shares outstanding - basic and diluted
	
 
	
 
	62,670,942	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	
 
	62,670,942	
 




 


	 
	
	

 
	 



 

Note 1: Basis of Presentation 

 

The unaudited pro forma financial information has been compiled from underlying financial statements prepared in accordance with U.S. GAAP. The unaudited pro forma financial information has been compiled from the following sources with the following unaudited adjustments:

 


		
·

 
	
Historical financial information for EOS Inc. (“EOS”) has been extracted without adjustment from EOS’ audited consolidated financial statements for the year ended December 31, 2016 contained in EOS’ Annual Report on Form 10-K filed with the SEC on April 14, 2017.

	
 
	
 
	
 

	
 
	
·

 
	
Historical financial information for the Emperor Star International Trade Co., Ltd. (“Emperor Star”) has been extracted without material adjustment from Emperor Star’s audited financial statements for the year ended December 31, 2016 as contained in this Form 8-K.




 

The following pro forma financial statements should be read in conjunction with:

 


		
·
	
the accompanying notes to the Unaudited Pro Forma Financial Information;

	
 
	
 
	
 

	
 
	
·
	
the consolidated financial statements of EOS for the year ended December 31, 2016 and the notes relating thereto; and

	
 
	
 
	
 

	
 
	
·
	
the financial statements of Emperor Star for the year ended December 31, 2016 and the notes relating thereto, included in this Form 8-K.




 

This unaudited pro forma financial information is not intended to reflect the financial position and results which would have actually resulted had the acquisition of Emperor Star been effected on the dates indicated. Further, the pro forma results of operations are not necessarily indicative of the results of operations that may be obtained in the future.

 

Note 2: Description of Transactions

 

On May 3, 2017, EOS Inc. (“EOS”) entered into and closed a share exchange agreement (the “Exchange Agreement”) with Emperor Star International Trade Co., Ltd. (“Emperor Star”). Pursuant to the Exchange Agreement, EOS completed the acquisition through the cash payment of $30,562 to the shareholder of Emperor Star in exchange for all the issued and outstanding capital stock of Emperor Star (“Emperor Star Acquisition”).

 

Since EOS and Emperor Star were entities under Mr. Yu Cheng Yang’s common control prior to the Emperor Star Acquisition, the transaction is accounted for as a restructuring transaction. EOS Media has recast prior period financial statements to reflect the conveyance of Emperor Star’s common shares as if the restructuring transaction had occurred as of the earliest date of the financial statements.

 

Note 3: Unaudited Pro Forma Adjustments to Consolidated Financial Statements

 

Pro forma adjustments on the attached financial statements include the following:

 

(a) This adjustment reflects the cash payment of $30,562 for the Emperor Star Acquisition of all issued and outstanding shares of common stock of Emperor Star to arrive at common stock $64,123 (64,122,997 shares with $0.001 per value) as a result of the transaction.