EXHIBIT 99.1



FLEXO UNIVERSAL, S.A. DE C.V.



INDEPENDENT AUDITOR’S REPORT

AS OF DECEMBER 31 2014 AND 2013



1







FLEXO UNIVERSAL, S.A. DE C.V.



INDEX



|1.- | Independent
    Auditors’ Report.                 
|--- | --------------------------------------------------
|    |                                                   
|2.- | Balance Sheet.                                    
|    |                                                   
|3.- | Statement of
    (Loss) Income.                   
|    |                                                   
|4.- | Statements
    of Changes in Stockholders’ Equity.
|    |                                                   
|5.- | Statement of
    Cash Flow.                       
|    |                                                   
|6.- | Notes to the
    financial statements.            



2







Report of Independent Registered
Public Accounting Firm



To the Stockholders and Board of
Directors of

Flexo Universal, S.A. de C.V.



We have audited
the accompanying balance sheets of Flexo Universal, S.A. de C.V.as of December 31 2014 and 2013, and the related
statement of operations, stockholders' equity and cash flows for the years then ended. These financial statements are the responsibility
of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.



We conducted our audit in accordance
with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An
audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate
in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control
over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence
supporting the amounts and disclosures in the consolidated financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinions.



We draw attention to Note 2 of the financial
statements, which describes the basis of accounting. The financial statements are prepared according to Financial Reporting Standards
Applicable Mexico (FRS), which is a basis of accounting other than accounting principles generally accepted in the United States
of America. Our opinions are not modified with respect to this matter.



In our opinion, the financial statements
referred to above present fairly, in all material respects, the financial position of Flexo Universal, S.A. de C.V., as
of December 31 2014 and 2013 and the results of their operations and their cash flows for the years then ended, in conformity
with the basis of accounting described above.



HLB Vargas Graf y Cia., S.C

Zapopan, Jalisco, Mexico C.Cp. 45040



C.P.C. Antonio Vargas Aceves

Certified Public Accountant

Partner



November 25, 2015

3







FLEXO UNIVERSAL, S.A. DE C.V.

BALANCE SHEET AS OF DECEMBER 31,
2014 AND 2013

( In Mexican pesos )

(Notes 1 & 2)



|                                                                                    |  | 2014 |             |  | 2013 |  
|----------------------------------------------------------------------------------- |  | ---- | ----------- |  | ---- | -
|CURRENT ASSETS:                                                                     |  |      |             |  |      |  
|                                                                                    |  |      |             |  |      |  
|Cash and cash equivalents                                                           |  | $    | 1,831,998   |  |      | $
|Accounts receivables                                                                |  |      | 40,413,382  |  |      |  
|Other accounts receivables (Note 3)                                                 |  |      | 3,840,861   |  |      |  
|Related parties  (Note 4)                                                           |  |      | 15,942,740  |  |      |  
|Inventories  (Note 5)                                                               |  |      | 49,368,070  |  |      |  
|Total current assets                                                                |  |      | 111,397,051 |  |      |  
|                                                                                    |  |      |             |  |      |  
|NON CURRENT ASSETS:                                                                 |  |      |             |  |      |  
|                                                                                    |  |      |             |  |      |  
|Machinery and equipment (Note 6)                                                    |  |      | 7,771,767   |  |      |  
|                                                                                    |  |      |             |  |      |  
|Warranty deposits                                                                   |  |      | 1,287,837   |  |      |  
|                                                                                    |  |      |             |  |      |  
|Other assets                                                                        |  |      | 766,543     |  |      |  
|                                                                                    |  |      |             |  |      |  
|Deferred income tax (Note 13)                                                       |  |      | 594,582     |  |      |  
|                                                                                    |  |      |             |  |      |  
|Total non current assets                                                            |  |      | 10,420,729  |  |      |  
|                                                                                    |  |      |             |  |      |  
|TOTAL ASSETS                                                                        |  | $    | 121,817,780 |  |      | $
|                                                                                    |  |      |             |  |      |  
|CURRENT LIABILITIES                                                                 |  |      |             |  |      |  
|                                                                                    |  |      |             |  |      |  
|Accounts payable to suppliers, accrued expenses and other accounts payable (Note 7) |  | $    | 18,016,793  |  |      | $
|ISR payable                                                                         |  |      | 3,342,273   |  |      |  
|PTU reserve                                                                         |  |      | 448,098     |  |      |  
|Current portion of long term liabilities to related parties (Note 8)                |  |      | 9,449,593   |  |      |  
|Total current liabilities                                                           |  |      | 31,256,757  |  |      |  
|                                                                                    |  |      |             |  |      |  
|LONG TERM LIABILITIES                                                               |  |      |             |  |      |  
|                                                                                    |  |      |             |  |      |  
|Long term liabilities to related parties  (Note 8)                                  |  |      | 2,807,062   |  |      |  
|                                                                                    |  |      |             |  |      |  
|Total long term liabilities                                                         |  |      | 2,807,062   |  |      |  
|                                                                                    |  |      |             |  |      |  
|TOTAL LIABILITIES                                                                   |  |      | 34,063,819  |  |      |  
|                                                                                    |  |      |             |  |      |  
|STOCKHOLDERS' EQUITY                                                                |  |      |             |  |      |  
|                                                                                    |  |      |             |  |      |  
|Capital stock  (Note 10)                                                            |  |      | 47,410,945  |  |      |  
|Legal Reserve                                                                       |  |      | 1,393,404   |  |      |  
|Accumulated results                                                                 |  |      | 22,830,186  |  |      |  
|Period's net (loss) profit                                                          |  |      | 16,119,426  |  |      |  
|TOTAL STOCKHOLDERS' EQUITY                                                          |  |      | 87,753,961  |  |      |  
|                                                                                    |  |      |             |  |      |  
|Contingencies (Note 12)                                                             |  |      | -           |  |      |  
|                                                                                    |  |      |             |  |      |  
|TOTAL LIABILITIES AND STOCKHOLDERS'
    EQUTIY                                      |  | $    | 121,817,780 |  |      | $



The enclosed notes are an integral part
of these financial statements



4







FLEXO UNIVERSAL, S.A. DE C.V.

STATEMENT OF OPERATIONS FOR THE YEARS
ENDED

DECEMBER 31, 2014 AND 2013

( In Mexican pesos )



|                                   |  | 2014 |              |   | 2013 |  
|---------------------------------- |  | ---- | ------------ | - | ---- | -
|                                   |  |      |              |   |      |  
|Net sales                          |  | $    | 169,425,816  |   |      | $
|Cost of products sold              |  |      | (126,903,053 | ) |      |  
|GROSS PROFIT                       |  |      | 42,522,763   |   |      |  
|                                   |  |      |              |   |      |  
|Operating expenses                 |  |      |              |   |      |  
|Administration and sales expenses  |  |      | (17,381,574  | ) |      |  
|Other income, (expenses)  - net    |  |      | (1,062,665   | ) |      |  
|                                   |  |      | (18,444,239  | ) |      |  
|                                   |  |      |              |   |      |  
|OPERATION NET PROFIT               |  |      | 24,078,523   |   |      |  
|                                   |  |      |              |   |      |  
|INTEGRAL FINANCING RESULTS         |  |      |              |   |      |  
|Exchange rate fluctuations - net   |  |      | 861,038      |   |      |  
|interest - net                     |  |      | (1,107,052   | ) |      |  
|                                   |  |      | (246,014     | ) |      |  
|                                   |  |      |              |   |      |  
|PROFIT BEFORE INCOME TAXES AND EPS |  |      | 23,832,509   |   |      |  
|                                   |  |      |              |   |      |  
|Employees' profit sharing          |  |      | (361,222     | ) |      |  
|Income tax                         |  |      | (6,356,134   | ) |      |  
|Deferred income tax                |  |      | (995,726     | ) |      |  
|                                   |  |      | (7,713,083   | ) |      |  
|                                   |  |      |              |   |      |  
|NET  PROFIT                        |  | $    | 16,119,426   |   |      | $



The accompanying notes are an integral
part of these financial statements



5







FLEXO UNIVERSAL, S.A. DE C.V.



STATEMENT OF CHANGES IN STOCKHOLDER'S
EQUITY

FOR THE YEARS ENDED DECEMBER 31,
2014 AND 2013

( In Mexican pesos )



|                                                         |  | 2014 |             |   | 2013 |  
|-------------------------------------------------------- |  | ---- | ----------- | - | ---- | -
|                                                         |  |      |             |   |      |  
|CAPITAL STOCK                                            |  |      |             |   |      |  
|                                                         |  |      |             |   |      |  
|Initial period balance                                   |  | $    | 44,934,998  |   |      | $
|Capital stock increase (Note 10)                         |  |      | 2,475,947   |   |      |  
|Capital stock decrease (Note 10)                         |  |      |             |   |      |  
|Initial and final period balance                         |  |      | 47,410,945  |   |      |  
|                                                         |  |      |             |   |      |  
|LEGAL RESERVE                                            |  |      |             |   |      |  
|                                                         |  |      |             |   |      |  
|Initial period balance                                   |  |      | 670,811     |   |      |  
|Transfer from accumulated results (Note 11)              |  |      | 722,593     |   |      |  
|Final period balance                                     |  |      | 1,393,404   |   |      |  
|                                                         |  |      |             |   |      |  
|ACCUMULATED RESULTS                                      |  |      |             |   |      |  
|                                                         |  |      |             |   |      |  
|Initial period balance                                   |  |      | 11,596,368  |   |      |  
|Transfer from net  profit (loss)                         |  |      | 14,451,872  |   |      |  
|Transfer of 5% over profit period 2012, to legal reserve |  |      | (722,593    | ) |      |  
|Dividends                                                |  |      | (2,495,461  | ) |      |  
|Final period balance                                     |  |      | 22,830,186  |   |      |  
|                                                         |  |      |             |   |      |  
|NET PROFIT (LOSS)                                        |  |      |             |   |      |  
|                                                         |  |      |             |   |      |  
|Initial period balance                                   |  |      | 14,451,872  |   |      |  
|Transfer to accumulated results                          |  |      | (14,451,872 | ) |      |  
|Net  profit                                              |  |      | 16,119,426  |   |      |  
|Final period balance                                     |  |      | 16,119,426  |   |      |  
|                                                         |  |      |             |   |      |  
|TOTAL                                                    |  | $    | 87,753,961  |   |      | $



The accompanying notes are an integral
part of these financial statements



6







FLEXO UNIVERSAL, S.A. DE C.V.



CASH FLOW STATEMENT

FOR THE YEARS ENDED DECEMBER 31,
2014 AND 2013



( In Mexican pesos )



|                                                        |  | 2014 |             |   | 2013 |  
|------------------------------------------------------- |  | ---- | ----------- | - | ---- | -
|OPERATING ACTIVITIES:                                   |  |      |             |   |      |  
|                                                        |  |      |             |   |      |  
|Net profit                                              |  | $    | 16,119,426  |   |      | $
|                                                        |  |      |             |   |      |  
|Items related with investment activities                |  |      |             |   |      |  
|Depreciation                                            |  |      | 2,191,987   |   |      |  
|Balance canceled due to defered flat tax abrogation     |  |      | -           |   |      |  
|Items related with financing activities                 |  |      |             |   |      |  
|Interest                                                |  |      | 1,107,052   |   |      |  
|                                                        |  |      | 19,418,465  |   |      |  
|                                                        |  |      |             |   |      |  
|Trade debtors and other receivables (increase) decrease |  |      | (18,982,817 | ) |      |  
|Inventories increase                                    |  |      | (6,834,407  | ) |      |  
|Other assets (increase) decrease                        |  |      | 1,951,564   |   |      |  
|Liabilities to related parties increase (decrease)      |  |      | 1,986,564   |   |      |  
|Suppliers and other liabilities (decrease)  increase    |  |      | 35,182      |   |      |  
|Taxes paid                                              |  |      | (452,736    | ) |      |  
|                                                        |  |      |             |   |      |  
|Net cash flow from financial activities                 |  |      | (2,878,185  | ) |      |  
|                                                        |  |      |             |   |      |  
|INVESTING ACTIVITIES:                                   |  |      |             |   |      |  
|                                                        |  |      |             |   |      |  
|Machinery and equipment acquisition (net)               |  |      | (1,926,224  | ) |      |  
|                                                        |  |      |             |   |      |  
|                                                        |  |      | (1,926,224  | ) |      |  
|FINANCING ACTIVITIES:                                   |  |      |             |   |      |  
|                                                        |  |      |             |   |      |  
|Long term liabilities to related parties                |  |      | 97,614      |   |      |  
|Paid interest                                           |  |      | (1,107,052  | ) |      |  
|Dividends                                               |  |      | (2,495,461  | ) |      |  
|Increase Social Capital (capitalization of liabilities) |  |      | -           |   |      |  
|Social Capital (Decrease) increase                      |  |      | 2,475,947   |   |      |  
|                                                        |  |      | (1,028,952  | ) |      |  
|                                                        |  |      |             |   |      |  
|INCREASE IN CASH AND CASH EQUIVALENTS                   |  | $    | (5,833,361  | ) |      | $
|                                                        |  |      |             |   |      |  
|Cash and cash equivalents at beginning
    of year      |  | $    | 7,665,359   |   |      | $
|Cash and cash equivalents at end
    of year            |  | $    | 1,831,998   |   |      | $



The accompanying notes are an integral
part of these financial statements



7







NOTES TO FINACIAL STATEMENTS

FLEXO UNIVERSAL, S.A. DE C.V.

As of December 31st,
2014 and 2013

In Mexican pesos.



NOTE 1 – COMPANY DESCRIPTION:



Flexo Universal, S.A. de C.V. (FLEXO)
was constituted on 2002. Subsidiary of CTI Industries INC, a North American company that owns 99.8260% of its capital stock.



Its main activity is the production
of latex and mylar balloons; this operation is performed under the shelter of its parent company that finances its operations.



NOTE 2 – MAIN ACCOUNTING
POLICIES



| | a. | Basis
                                         for presentation
| | -- | ---------------------------------------------------------------



Thesignificant
accounting policies adopted by the company are in accordance with the Financial Reporting Standards in Mexico (FRS) and Interpretations
to the Financial Reporting Standards (IFRS).



ThoseStandards (FRS), may differ from accounting principles generally accepted in the United States of America (US GAAP). However,
under an analysis of similarities, convergences and important differences between the two standards with respect to the operations
recorded that generate the financial information of the Company, we can conclude that there are no differences that could lead
to material adjustments and alter that information



| | b. | Estimates
                                         and assumptions
| | -- | ------------------------------------------------------------------



The preparation of financial statements in
accordance with Mexican financial reporting standards requires the company's management to make certain estimates and provisions
that may affect the value of some assets and liabilities at the date of the balance sheet, as well as the value and measurement
of revenues, costs and expenses during the reported period. Even if the final result of these estimates and provisions may differ
from the calculated, management believes that those were appropriate used to the circumstances.



| | c. | Monetary
                                         unit
| | -- | ------------------------------------------------------



Financial Statements are prepared in
Mexican pesos ($), currency which, bases on Mexican laws, the company’s accounting records must be prepared.



| | d. | Cash
                                         and equivalents
| | -- | -------------------------------------------------------------



Mainly represented by deposits in bank
accounts.



| | e. | Accounts
                                         receivable and estimation for allowance for doubtful accounts
| | -- | ---------------------------------------------------------------------------------------------------------------



Represent collection right originated
from inventory sales. Accounts in foreign currency are valuated at the year closing exchange rate.



Estimates for doubtful collection accounts
represent the inherent probable loss of all receivables due the behaviour of historic tendencies of the accounts receivable. Since
2009 the company has issued a provision to absorb the uncollectible accounts.



8







| | f. | Inventories
| | -- | -----------



Inventories of finished goods, production
in process and raw materials, are registered at its historic acquisition and production cost, using the absorbing cost system.
The acquisition cost includes all associated expenses until the inventories are ready to be produced or sold. Inventories are
valuated by the average cost method net form the value estimates which does not exceed their realization value.



| | g. | Machinery
                                         and equipment
| | -- | ----------------------------------------------------------------



Fixed Assets acquired from the fusion,
were registered according to the historic cost of the absorbed company, adding the difference from the valuation practiced by
and independent appraiser on 17th, 1996. Fixed assets acquisitions after the fusion are registered at its acquisition
cost.



The acquisition cost includes all associated
expenses until the fixed assets are ready to be used.



Depreciations are computed by the straight-line
method, beginning in year in which assets are used, and according to the following:



|                               |  | Rates % |      
|------------------------------ |  | ------- | -----
|Leasehold improvements         |  |         | 10.00
|Molds                          |  |         | 20.00
|Computer equipment             |  |         | 30.00
|Machinery and office equipment |  |         | 10.00
|Tools and medical equipment    |  |         | 35.00
|Transport equipment            |  |         | 25.00
|Forklift                       |  |         | 25.00



| | h. | Long
                                         lived assets evaluation
| | -- | ---------------------------------------------------------------------



Impairment of long term assets –
As of January 1°, 2004 The C-15 Bulletin “Impairment in the value of long lasting assets and its disposal” became
effective. This bulletin requires that companies determine the effect of impairment in long lasting assets in use, in case of
detection of indication of impairment or losses for impairment recognized in those assets. In opinion of the Company’s management,
there are no traces of impairment that could have an effect in the results, in accordance with the Bulletin.



| | i. | Income
                                         tax
| | -- | ---------------------------------------------------



The current income tax is determined
according to current tax legislation. The deferred income tax is recorded in accordance with the asset and liability method, which
compares the accounting and tax values of them. Deferred tax are recognized (assets and liabilities) for future tax consequences
attributable to temporary differences between the values reflected in the financial statements of existing assets and liabilities
and their respective tax bases and for tax loss carry forwards and tax credits not used. The assets and liabilities of deferred
tax are calculated using the rates established in the law that will be applied to taxable income in years when it is estimated
that the temporary differences will reverse. The effect of changes in tax rates on deferred taxes is recognized in the results
of the period in which those changes are approved. The deferred tax asset is recorded only when there is a high probability of
recovery. As of January 1°, 2008 this FRS was modified, the main changes are:



| | · | Caused
                                         and deferred Employee Profit Sharing (PTU).- This concept is considered as an ordinary
                                         expense based on the benefits to employees, that is the reason why it is now classified
                                         in the results statement in other income and expenses.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Cumulative
                                         Effect of Income Tax — The previous bulletin stated that this component will be
                                         presented separately in equity, the change consists to reclassify this concept to cumulative
                                         results.
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



9







| | j. | Liabilities
| | -- | -----------



The Company applies the dispositions
of FRS C-9 “Liabilities, provisions, contingent assets and liabilities and commitments”. Bulletin C-9 establishes
the valuation, presentation and disclosure general rules of liabilities provisions, contingent assets and liabilities.



| | k. | Labor
                                         liabilities
| | -- | ----------------------------------------------------------



As of February 2014, the Company’s
management decided to outsource payroll services through the figure "Outsourcing" with the company Desarrollo Fomento
Organizativo, SA de CV, so from that date on employees of Universal Flexo, SA de CV, retaining their seniority and rights, became
employees of "Desarrollo Fomento Organizativo, SA de C.V. "



| | l. | Recognition
                                         of revenue
| | -- | ---------------------------------------------------------------



Revenue is recognized in the period
in which the risks and benefits of inventory are transferred to customers who acquire them, which generally occurs when these
inventories are delivered and the corresponding invoice is prepared



| | m. | Foreign
                                         currency operations
| | -- | --------------------------------------------------------------------



Foreign currency operations are accounted
at the exchange rate of the day of their occurrence. Assets and liabilities in foreign currency are registered in Mexican pesos
at the exchange rate published by the Central Bank (Banco de Mexico) at the date of the financial statements. Exchange rate differences
in assets and liabilities in foreign currency are registered in the year’s result.



| | n. | Leasing
| | -- | -------



The company classifies as operative
leasing those operations in which only is granted the use or possession of the leased assets, without assuming the risks or benefits
of such assets. These rents are applied to the results in the period of the lease. Variable rents are applied to results as they
are accrued.



| | o. | Income
                                         statement
| | -- | ---------------------------------------------------------



Income statements are classified by
its operative activities, according to the company’s opinion; this classification allows evaluating the result of its operations
identifying the cost of goods sold and administrative and sales expenses.



| | p. | Integral
                                         Financial Result (RIF)
| | -- | ------------------------------------------------------------------------



The RIF includes net accrued interests,
exchange rate profit (loss), monetary position gain (loss) and derivate financial instruments profit (loss).



Exchange rate profit (loss) originated
by transactions in foreign currency, is the result of the exchange rates fluctuations at the date of the operation registry, at
the date of realization or at the periods end valuation.



10







NOTE 3 – OTHER ACCOUNTS
RECEIVABLE



As of December 31st, 2014
and 2013, the other accounts receivable are integrated as follows:



|                                              |  | 2014 |           |  | 2013 |  
|--------------------------------------------- |  | ---- | --------- |  | ---- | -
|Accounts receivable to officers and employees |  | $    | -         |  |      | $
|Sundry debtors                                |  |      | 824,545   |  |      |  
|Other Collective taxes                        |  |      | 1,067,472 |  |      |  
|Creditable VAT                                |  |      | 1,948,844 |  |      |  
|                                              |  | $    | 3,840,861 |  |      | $



NOTE 4 – RELATED PARTIES



Following a summary of the operations
with related parties which originate the balances with related parties as of December 31st, 2014 and 2013 is presented:



|                           |  | 2014 |            |  | 2013 |  
|-------------------------- |  | ---- | ---------- |  | ---- | -
|Goods Sold:                |  |      |            |  |      |  
|CTI Industries Corporation |  | $    | 21,292,943 |  |      | $
|                           |  |      |            |  |      |  
|Inventory Purchases:       |  |      |            |  |      |  
|CTI Industries Corporation |  | $    | 7,694,886  |  |      | $



Accounts receivable and (payable) to
related parties are:



|                                    |  | Asset (Liabilitie) |           
|----------------------------------- |  | ------------------ | ----------
|                                    |  | 2014               |           
|CTI Industries Corporation          |  | $                  | 11,750,928
|Arci, S.C.                          |  |                    | -         
|Pablo Gortazar de Oyarzabal         |  |                    | 779,992   
|Calidad Empresarial Mexicana        |  |                    | (13,040   
|CTF International S.A. de C.V.      |  |                    | -         
|CTI Mexico Corporation S.A. de C.V. |  |                    | -         
|CTI Europe GMBH                     |  |                    | 2,217,320 
|Venture Leasing, S. de R.L. de C.V. |  |                    | 1,207,540 
|                                    |  | $                  | 15,942,740



NOTE 5 – INVENTORIES



The balance of this account is integrated
as follows:



|                      |  | 2014 |            |  | 2013 |  
|--------------------- |  | ---- | ---------- |  | ---- | -
|Finished goods        |  | $    | 38,494,667 |  |      | $
|Packing material      |  |      | 2,519,357  |  |      |  
|Production in process |  |      | 3,455,053  |  |      |  
|Raw materials         |  |      | 4,898,993  |  |      |  
|                      |  | $    | 49,368,070 |  |      | $



11







NOTE 6 – MACHINERY AND
EQUIPMENT



This item is analysed follows:



|                                |  | 2014 |             |   | 2013 |  
|------------------------------- |  | ---- | ----------- | - | ---- | -
|Machinery                       |  | $    | 25,982,728  |   |      | $
|Leasehold improvements          |  |      | 3,003,934   |   |      |  
|Molds                           |  |      | 5,426,380   |   |      |  
|Computer equipment and softwere |  |      | 827,519     |   |      |  
|Transport equipment             |  |      | 297,273     |   |      |  
|Furniture and office equipment  |  |      | 276,723     |   |      |  
|                                |  |      | 35,814,557  |   |      |  
|Depreciations and amortizations |  |      | (28,042,790 | ) |      |  
|Total Machinery and equipment   |  | $    | 7,771,767   |   |      | $



The depreciation and amortization method
and the annual rates are stated in note 2g. The charge to results amounted $2,191,987. and $2,694,889. for the periods ended on
December 31st, 2014 and 2013 respectively.



Leasehold agreement

The company celebrated a leasehold
agreement with Cuauhtemoc Inmobiliaria S.A. de C.V., for the building and facilities where it is located, both plant and administrative
offices, these agreements establishes that the term of the leasehold is of a mandatory 5 years and 5 years voluntary to the sub-lessor,
the new agreement takes place since August 1st 2011 and ends on July 13, 2016.



The charge to results amounted $4,994,680.
and $4,961,429.for the years ended on December 31st, 2014 and 2013 respectively



NOTE 7 – OTHER ACCOUNTS
PAYABLE



Some items presented in the balance
sheet are analysed as follows, as of December 31st.



|                                                                            |  | 2014 |            |  | 2013 |  
|--------------------------------------------------------------------------- |  | ---- | ---------- |  | ---- | -
|Accounts payable to suppliers, accrued expenses and other accounts payable: |  |      |            |  |      |  
|Suppliers                                                                   |  | $    | 15,200,710 |  |      | $
|Salaries payable                                                            |  |      | -81,864    |  |      |  
|Sundry creditors                                                            |  |      | 2,759,411  |  |      |  
|Rated reserves                                                              |  |      | 123,206    |  |      |  
|Taxes payable                                                               |  |      | 15,330     |  |      |  
|                                                                            |  | $    | 18,016,793 |  |      | $



12









NOTE 8 – LONG TERM LIABILITIES
TO RELATED PARTIES



|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  | 2014 |            |   | 2013 | 
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---- | ---------- | - | ---- | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |      |            |   |      | 
|CTI  Industries                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |  |      |            |   |      | 
|Term promissory note                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |  |      |            |   |      | 
|Flexo Universal, S.A. de C.V., hereby further promises to pay interest to the order of CTI Industries
    Corporation on the unpaid principal balance hereof at the Interest Rate (as hereinafter defined). Such interest shall be paid
    in like money at said office or place from the date hereof, commencing March 31, 2014 and on the first day of each calendar
    quarter thereafter until the indebtedness evidenced by this Note is paid in full. Interest payable upon and after an Event
    of Default or termination or non renewal of the Loan Agreement shall be payable upon demand. For purposes hereof, the
    term "Interest Rate" shall mean a rate of two and one-half percent (2.5%) per annum ; provided, that, at Payee's option, the
    Interest Rate shall mean a rate of eight percent (8.0%) per annum upon and after an Event of Default ; the term “Event
    of Default shall mean the failure of Flexo Universal, S.A. de C.V., to make any payment of principal or interest when due
    hereunder. This Note is issued to document amounts due from Flexo Universal, S.A. de C.V., to CTI Industries Corporation
    as of December 31, 2013, including $68,669 in principal amount due and $502,545 in accrued interest on indebtedness previously
    due from Flexo Universal, S.A. de C.V., to CTI Industries Corporation. |  |      |            |   |      | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |      | 8,627,141  |   |      | 
|Current portion of long term liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  |      | (8,627,141 | ) |      | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |      |            |   |      | 
|Loans current account 2014                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |  |      |            |   |      | 
|Undocumented loans current account totaling $ 55.817 US dollars, without interest and agreed
    term                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |  |      | 822452     |   |      | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |      |            |   |      | 
|Current portion of long term liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |  |      | (822,452   | ) |      | 
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |      |            |   |      | 
|CTI  Balloons                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |  |      |            |   |      | 
|Loan made by CTI BALLONS to finance the company's operation amounted $69,478 US dollars payable
    in 3 years with an interest annual rate of LIBOR +.25 points                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |      | 1,023,744  |   |      | 
|interest payable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |  |      | 530,209    |   |      | 



|Pablo Gortazar                                                                                                                                           |  |   |            |   |  |   |            |  
|-------------------------------------------------------------------------------------------------------------------------------------------------------- |  | - | ---------- | - |  | - | ---------- | -
|                                                                                                                                                         |  |   |            |   |  |   |            |  
|Loan made by PABLO GORTAZAR to liquidate CTF INTERNATIONAL's financing amounted $980,704
    Mexican Pesos.                                              |  |   | 980,704    |   |  |   | 980,704    |  
|                                                                                                                                                         |  |   |            |   |  |   |            |  
|Loan made by PABLO GORTAZAR to liquidate CREDIT UNION's fiancincing amounted $776,070 Mexican
    pesos,  with an interest annual rate LIBOR +.25 points |  |   | 272,405    |   |  |   | 391,019    |  
|                                                                                                                                                         |  |   |            |   |  |   |            |  
|                                                                                                                                                         |  |   | 12,256,655 |   |  |   | 10,172,477 |  
|Total long term liabilities to related parties                                                                                                           |  |   | (9,449,593 | ) |  |   | (7,463,029 | )
|Total current portion of long term liabilities                                                                                                           |  | $ | 2,807,062  |   |  | $ | 2,709,448  |  



13









NOTE 9 – POSITION AND TRANSACTION
IN FOREING CURRENCY



As of December 31st, 2014
and 2013, the company had rights and (obligations) in foreign currency as follows:



|                                                                    |  | US Dollars |           
|------------------------------------------------------------------- |  | ---------- | ----------
|                                                                    |  | 2014       |           
|Assets                                                              |  | $          | 1,845,213 
|Liabilities                                                         |  |            | (1,620,173
|                                                                    |  |            |           
|Excess of assets over (liabilities), assets in foreign
    currency |  | $          | 225,040   



Assets where translated and adjusted
using the exchange rate $14.7348 and $ 13.0652 pesos per US dollar, as of December 31st, 2014 and 2013 respectively.
As of march 17, 2015 the exchange rate is $15.4271 pesos per dollar.



NOTE 10 – CONTRIBUTED CAPITAL



The company’s capital stock integrated
as follows as of December 31st, 2014 and 2013:



|                       |  | 2014 |            |  | 2013 |  
|---------------------- |  | ---- | ---------- |  | ---- | -
|Fixed capital stock    |  | $    | 50,000     |  |      | $
|Variable capital stock |  |      | 47,360,945 |  |      |  
|                       |  |      |            |  |      |  
|Total capital stock    |  | $    | 47,410,945 |  |      | $



The company’s capital stock is
variable, with a fix minimum of $50,000 without possible of retiring. The variable part has not limit. Shares are common, nominative
and are valuated as follows:



|Share Series |  |  | US Dollars |  |  |  | MX Pesos | 
|------------ |  |  | ---------- |  |  |  | -------- | 
|"A"          |  |  | 0.0679     |  |  |  | 1.00     | 
|"B"          |  |  | 0.0679     |  |  |  | 1.00     | 



On April 3, 2014 the shareholders of
the company agreed and approved unanimously an increase to variable share capital in the amount of $ 150,000. US dollars or its
equivalent in pesos $ 2'475,947, by issuing 2'475,947 Series B common shares with nominal value of $ 1.00 each



On March 26, 2014 the shareholders
of the company agreed and approved unanimously to declare a dividend payment from the income tax earnings (CUFIN) for a total
of $ 190,347.77. US dollars or its equivalent in pesos $ 2'495,459.20



In the Ordinary General Meeting held
the day August 5, 2013, a decrease of share capital was approved in the variable by repayment of 21,411 shares with a par value
of $ 1.00 each.



In the Ordinary General Meeting held
the day August 16, 2013, an increase of capital was approved in the variable through the capitalization of liabilities by the
Company and for CTI Industries Corporation totalling $ 39,857,357. pesos M.N.



14







NOTE 11 – EARNED (LOSS)
SURPLUS:



Under Mexican laws, a legal reserve
must be created and increased by annually in 5% of the retained earnings up to a total of 20% of the Company’s Capital Stock.
This reserve is not available for dividends payments, but can be used to reduce accumulated losses or to be turned in capital
stock.



NOTE 12 – CONTINGENCIES:



| | a. | Federal
                                         contributions are subject to certain reviews by the fiscal authorities, during a five
                                         year period.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | b. | Due
                                         to the related parties operations there could be some differences with taxes, if the
                                         fiscal authority decides to review those transactions, and the IRS considers that the
                                         prices and amounts used by the Company were not at the same level as those used in the
                                         regular market or among independent parties in comparable transactions.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



NOTE 13- INCOME TAX (IT), CORPORATE
FLAT TAX RATE (IETU) AND EMPLOYEES PROFIT SHARING (PTU):



Cost (benefit) of the tax applied to
result is integrated as follows:



|              |  | 2014 |           |  | 2013 |  
|------------- |  | ---- | --------- |  | ---- | -
|ISR payable   |  | $    | 6,356,134 |  |      | $
|Deferred ISR  |  |      | 995,726   |  |      |  
|Deferred IETU |  |      |           |  |      |  
|Net           |  | $    | 7,351,860 |  |      | $



| | a. | IT
| | -- | --



The main differences between the accounting
profit and the tax result are:



|                                                                   |  | 2014 |            |  | 2013 |  
|------------------------------------------------------------------ |  | ---- | ---------- |  | ---- | -
|Net (Loss) profit                                                  |  | $    | 16,119,426 |  |      | $
|Plus (minus)                                                       |  |      |            |  |      |  
|Excess of accounting depreciation net over the fiscal depreciation |  |      | -1,483,107 |  |      |  
|Excess of accounting deductions net over the fiscal deductions     |  |      | 8,116,711  |  |      |  
|Fiscal (loss) profit                                               |  |      | 22,753,030 |  |      |  
|Minus employee profit sharing (PTU) paid in 2012 and 2011          |  |      | -1,565,918 |  |      |  
|Tax basis to IT                                                    |  |      | 21,187,112 |  |      |  
|Rate                                                               |  |      | 0.30       |  |      |  
|IT payable (ISR)                                                   |  | $    | 6,356,134  |  |      | $



15







As December 31st, 2014 and
2013 temporary differences and fiscal losses carry forward recognized by the company on the deferred IT calculations are:



|                         |  | 2014 |            |   | 2013 |  
|------------------------ |  | ---- | ---------- | - | ---- | -
|Year effect calculation: |  |      |            |   |      |  
|Deferred expenses        |  | $    | (286,898   | ) |      | $
|Suppliers                |  |      | (1,695,041 | ) |      |  
|Base                     |  |      | (1,981,939 | ) |      |  
|Tax Rate                 |  |      | 0.30       |   |      |  
|                         |  |      | (594,582   | ) |      |  
|Accrued inventory        |  |      | -          |   |      |  
|Total (debit) credit     |  |      | (594,582   | ) |      | $
|Recognized               |  |      | (1,590,308 | ) |      |  
|Complement               |  | $    | 995,726    |   |      |  



| | b. | IETU
| | -- | ----



On November 2013 tax reform was approved
for 2014, the following was modified:



- New Income Tax Law, rate remaining
at 30%.

- Law Corporate Flat Tax (IETU) is
abrogated.



The deferred IETU registered as a liability
in previous periods is cancelled because this tax law was abrogated and is no longer in force. According to IFRS 20 (Interpretations
to Financial Reporting Standards in Mexico) has to be accrued in the fiscal period 2013 as income for a total amount of $2,484,345.



|                                     |  | 2012 |             |   | 2011 |   |             | Previous years | 
|------------------------------------ |  | ---- | ----------- | - | ---- | - | ----------- | -------------- | 
|                                     |  |      |             |   |      |   |             |                | 
|Trade debtors                        |  |      | 29,013,948  |   |      | $ | 26,219,699  |                | 
|Liabilities provisions               |  |      | (13,238,508 | ) |      |   | (23,613,526 | )              | 
|                                     |  |      | 15,775,440  |   |      |   | 2,606,173   |                | 
|IETU rate                            |  |      | 17.50       | % |      |   | 17.50       | %              | 
|                                     |  |      | 2,760,702   |   |      |   | 456,080     |                | 
|Inventories and fixed assets credits |  |      | (276,357    | ) |      |   | (276,357    | )              | 
|Deferred IETU payable                |  |      | 2,484,345   |   |      | $ | 179,723     |                | 
|Recognized in previous years         |  |      | 179,723     |   |      |   | 744,259     |                | 
|Complement                           |  |      | 2,304,622   |   |      |   | (564,536    | )              | 



| | c. | PTU
| | -- | ---



As mentioned in note 2 l., The Company
had work obligations until January 31, 2014 date on which the company subcontract outsourcing services for personnel management.
Therefore the company determined and paid Employee profit sharing (PTU) only by the time elapsed from January 1 to January 31,
2014



Employee profit sharing (PTU) which
is caused at a 10% rate is calculated based on the fiscal profit, excluding the inflation effects. As of December 2014 and 2013,
employee profit sharing amounts to $361,222.and $1,574,698.



16







NOTE 14 - NEW ACCOUNTING PRONOUNCEMENTS.



The Mexican Council for Research and
Development of Financial Reporting Standards (CINIF), an independent body in charge of the development of the Mexican Accounting
Standards, has made public the submission of the following FRS (Financial Reporting Standards) listed below:



FRS C-9 “Provisions, contingencies
and commitments”

FRS C-19 “Financial Instruments
payable”

FRS D-3 “Employee Benefits”

Improvements to FRS 2015



The FRS C-9 and C-19 will become effective
as of January 1°, 2018; with early application permitted under the terms established in each FRS.



The FRS D-3 will become effective for
the fiscal years that begin as of January 1°, 2016.



The Improvements to FRS 2015, will
become effective for the fiscal years that begin as of January 1°, 2015.



Is important to note, the use of FRS
increases the quality of the financial information contained in the financial statements, thus ensuring their greater acceptance,
not only nationally, but also internationally.



NOTE 15 -.APPROVAL OF THE ISSUANCE
OF THE FINANCIAL STATEMENTS.



The financial statements were authorized
for issue on March 10, 2015, by Pablo Gortazar de Oyarzabal, General Manager and Legal Representative, and subject to the approval
of the general assembly of partners of the Company who may decide its modification in accordance with the provisions of the General
Law of Commercial Societies.



The accompanying explanatory notes
are an integral part of the financial statements.



| | Flexo
    Universal, S.A. de C.V.    | 
| | ------------------------------------ | 
| |                                      | 
| |                                      | 
| | Lic. Pablo Gortazar
    de Oyarzabal | 
| | Legal Representative                 | 



17