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As Of Filer Filing For·On·As Docs:Size Issuer Filing Agent 12/01/20 Folkup Development Inc. 8-K/A:1,2,311/25/20 7:1.8M Discount Edgar/FA |
Document/Exhibit Description Pages Size
1: 8-K/A Amendment to Current Report HTML 252K
2: EX-2.1 Share Exchange Agreement HTML 164K
3: EX-10.1 Exclusive Patent License Agreement HTML 30K
4: EX-10.2 Exclusive Patent License Agreement HTML 30K
5: EX-99.1 Combined and Consolidated Financial Statements HTML 174K
6: EX-99.2 Unaudited Condensed Combined and Consolidated HTML 175K
Financial Statements
7: EX-99.3 Pro Forma Financial Information HTML 80K
EXHIBIT 99.3
FOLKUP DEVELOPMENT INC.
PRO FORMA CONDENSED COMBINED BALANCE SHEET
AS OF SEPTEMBER 30, 2020
(Unaudited)
|
|
| Historical |
|
| Historical |
|
| Pro Forma |
|
|
|
| Pro Forma Condensed |
| ||||
|
|
| FLDI |
|
|
PHCL |
|
| Adjustments |
|
| Note |
| Combined |
| ||||
|
|
|
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|
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| ||||
| ASSETS |
|
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| ||||
| Current assets: |
|
|
|
|
|
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|
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|
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| ||||
| Cash and cash equivalents |
| $ | - |
|
| $ | 228,689 |
|
|
|
|
|
|
| $ | 228,689 |
| |
| Accounts receivable |
|
| - |
|
|
| 48,508 |
|
|
|
|
|
|
|
| 48,508 |
| |
| Deposits and prepayments |
|
| - |
|
|
| 724,573 |
|
|
|
|
|
|
|
| 724,573 |
| |
| Contract assets |
|
| - |
|
|
| 1,374,453 |
|
|
|
|
|
|
|
| 1,374,453 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Total current assets |
|
| - |
|
|
| 2,376,223 |
|
|
|
|
|
|
|
| 2,376,223 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Non-current assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Plant and equipment |
|
| - |
|
|
| 21,925 |
|
|
|
|
|
|
|
|
21,925 |
| |
| Right-of-use assets |
|
| - |
|
|
| 77,664 |
|
|
|
|
|
|
|
| 77,664 |
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| TOTAL ASSETS |
|
$ | - |
|
| $ | 2,475,812 |
|
|
|
|
|
|
| $ | 2,475,812 |
| |
|
|
|
|
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| |
| LIABILITIES AND STOCKHOLDERS’ DEFICIT |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Current liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
| Accrued liabilities and other payables |
| $ | 2,998 |
|
| $ | 920,628 |
|
|
| (2,998 | ) |
| (a) |
| $ | 920,628 |
|
| Contract liabilities |
|
|
|
|
|
| 2,290,890 |
|
|
|
|
|
|
|
|
| 2,290,890 |
|
| Bank and other borrowings |
|
|
|
|
|
| 557,311 |
|
|
|
|
|
|
|
|
| 557,311 |
|
| Amount due to a director |
|
| - |
|
|
| 127,622 |
|
|
|
|
|
|
|
|
| 127,622 |
|
| Lease liabilities |
|
|
|
|
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| 72,932 |
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|
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| 72,932 |
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|
|
|
|
|
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| Total current liabilities |
|
| 2,998 |
|
|
| 3,969,383 |
|
|
|
|
|
|
|
|
| 3,969,383 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Non-current liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Operating lease liabilities |
|
| - |
|
|
| 5,023 |
|
|
|
|
|
|
|
|
| 5,023 |
|
| Bank and other borrowings |
|
| - |
|
|
| 211,892 |
|
|
|
|
|
|
|
|
| 211,892 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Total liabilities |
|
| 2,998 |
|
|
|
4,186,298 |
|
|
|
|
|
|
|
|
| 4,186,298 |
|
|
|
|
|
|
|
|
|
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| Stockholders’ deficit: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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| Common stock |
|
| 3,800 |
|
|
| 521 |
|
|
| 5,479 |
|
| (b) |
|
| 9,800 |
|
| Additional paid-in capital |
|
| 23,200 |
|
|
| 357,062 |
|
|
| (28,679 | ) |
| (a),(b) |
|
| 351,583 |
|
| Accumulated other comprehensive income |
|
| - |
|
|
| (7,966 | ) |
|
|
|
|
|
|
|
| (7,966 | ) |
| Accumulated deficit |
|
| (29,998 | ) |
|
| (2,050,292 | ) |
|
| 26,198 |
|
| (a) |
|
| (2,054,092 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| (2,998 | ) |
|
| (1,700,675 | ) |
|
|
|
|
|
|
|
| (1,700,675 | ) |
|
Non-controlling interest |
|
| - |
|
|
| (9,811 | ) |
|
|
|
|
|
|
|
| (9,811 | ) |
|
Total deficit |
|
| (2,998 | ) |
|
| (1,710,486 | ) |
|
|
|
|
|
|
|
| (1,710,486 | ) |
| TOTAL LIABILITIES AND STOCKHOLDERS’ DEFICIT |
|
$ | - |
|
| $ | 2,475,812 |
|
|
|
|
|
|
|
| $ | 2,475,812 |
|
| F-1 |
FOLKUP DEVELOPMENT INC.
PRO FORMA CONDENSED COMBINED STATEMENT OF OPERATION
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2020
(Unaudited)
|
|
| Historical |
|
| Historical |
|
| Pro forma |
| Pro Forma Condensed |
| |||
|
|
| FLDI |
|
|
PHCL |
|
| Adjustment |
| Combined |
| |||
|
|
|
|
|
|
|
|
|
|
|
|
| |||
| Revenues, net |
| $ | - |
|
| $ | 1,704,935 |
|
|
|
| $ | 1,704,935 |
|
|
|
|
|
|
|
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|
|
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| Cost of revenues |
|
| - |
|
|
| (1,435,139 | ) |
|
|
|
| (1,435,139 | ) |
|
|
|
|
|
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| Gross profit |
|
| - |
|
|
| 269,796 |
|
|
|
|
| 269,796 |
|
|
|
|
|
|
|
|
|
|
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|
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|
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| Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Sales and marketing expenses |
|
| - |
|
|
| (555,334 | ) |
|
|
|
| (555,334 | ) |
| General and administrative expenses |
|
| (15,793 | ) |
|
| (815,103 | ) |
|
|
|
| (830,896 | ) |
| Total operating expenses |
|
|
(15,793 | ) |
|
| (1,370,437 | ) |
|
|
|
| (1,386,230 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Other income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Interest income |
|
| - |
|
|
| 6 |
|
|
|
|
| 6 |
|
| Sundry income |
|
| 37,649 |
|
|
| 80,991 |
|
|
|
|
| 118,640 |
|
| Interest expenses |
|
| - |
|
|
| (39,845 | ) |
|
|
|
| (39,845 | ) |
| Total other income |
|
| 37,649 |
|
|
| 41,152 |
|
|
|
|
|
78,801 |
|
|
|
|
|
|
|
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|
|
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|
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|
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|
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| INCOME (LOSS) BEFORE INCOME TAXES |
|
|
21,856 |
|
|
| (1,059,489 | ) |
|
|
|
| (1,037,633 | ) |
|
|
|
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|
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|
|
|
|
|
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| Income tax expense |
|
| - |
|
|
| - |
|
|
|
|
| - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| NET INCOME (LOSS) |
|
| 21,856 |
|
|
| (1,059,489 | ) |
|
|
|
| (1,037,633 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Less: Net loss attributable to non-controlling interests |
|
| - |
|
|
| (9,930 | ) |
|
|
|
| (9,930 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income (loss) attributable to stockholders of Powertech |
| $ | 21,856 |
|
| $ | (1,049,559 | ) |
|
|
| $ | (1,027,703 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Net income (loss) per share |
| $ | 0.01 |
|
|
|
|
|
|
|
| $ | (0.00 | ) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Weighted average shares outstanding |
|
| 3,800,000 |
|
|
|
|
|
|
|
|
| 9,800,000 |
|
| F-2 |
FOLKUP DEVELOPMENT INC.
NOTES TO PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
AS OF SEPTEMBER 30, 2020
(Unaudited)
NOTE 1 – BACKGROUND
On November 25, 2020, Folkup Development Inc. or the Company or FLDI completed the Share Exchange Agreement with Powertech Holdings Company Limited and Subsidiaries (collectively “PHCL”) (the “Share Exchange”) for its 100% equity interest. The consideration of the Share Exchange totaled approximately 6,000,000 shares of the Company’s common stock, at the price of $4.5 equal to $27,000,000.
This Acquisition is considered as related party transaction, whereas Mr. Ng is a controlling shareholder of the Company and PHCL.
NOTE 2 – BASIS OF PRESENTATION
Because FLDI is a shell company, PHCL will comprise the ongoing operations of the combined entity and its senior management will serve as the senior management of the combined entity, PHCL is deemed to be the accounting acquirer for accounting purposes. The transaction will be treated as a recapitalization of FLDI. Accordingly, the consolidated assets, liabilities and results of operations of FLDI will become the historical financial statements of PHCL, and FLDI’s assets, liabilities and results of operations will be consolidated with PHCL beginning on the acquisition date. These pro forma financial statements are presented as a continuation of PHCL.
The pro forma balance sheet as of September 30, 2020 is based on the historical financial statements of FLDI after giving effect to LHCL’s acquisition of FLDI as a reverse merger using the acquisition method of accounting and applying the assumptions and adjustments described in the notes to the pro forma financial statements as if such acquisition had occurred as of September 30, 2020 for the balance sheet for pro forma financial statements purposes.
The pro forma financial statements have been prepared by management for illustrative purposes only and are not necessarily indicative of the financial position or results of operations in future periods. The pro forma adjustments are based on the preliminary information available at the time of the preparation of this document and assumptions that management believes are reasonable. The pro forma financial statements, including the notes thereto, are qualified in their entirety by reference to, and should be read in conjunction with FLDI’s historical financial statements included elsewhere on Form 10-Q for the quarter ended September 30, 2020, as Exhibits filed with SEC herewith.
The pro forma financial statements do not purport to represent what the results of operations or financial position of the combined entity would actually have been if the merger had in fact occurred on September 30, 2020, nor do they purport to project the results of operations or financial position of the combined entity for any future period or as of any date.
These pro forma financial statements do not give effect to any restructuring costs or to any potential cost savings or other operating efficiencies that could result from the merger between FLDI and PHCL since such amounts, if any, are not presently determinable.
| F-3 |
FOLKUP DEVELOPMENT INC.
NOTES TO PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
AS OF SEPTEMBER 30, 2020
(Unaudited)
NOTE 3 – PRO FORMA ADJUSTMENTS
The pro forma financial statements have been prepared as if the acquisition was completed on September 30, 2020 for combined balance sheet purpose and reflects the following pro forma adjustment(s):
| (a) | To eliminate the accumulated deficits of FLDI incurred before the merger transaction to reflect the recapitalization of FLDI |
|
|
|
|
|
|
|
|
|
|
| Dr. Additional paid-in capital | 23,200 |
|
|
|
| Dr. Accrued liabilities and other payables | 2,998 |
|
|
|
| Cr. Retained earnings |
|
| 26,198 |
|
|
|
|
|
|
| (b) | To reflect the issuance of 6,000,000 shares of common stock of FLDI for the acquisition of 100% of PHCL outstanding capital stock and reclassify 521 ordinary shares of PHCL to additional paid-in capital | |||
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|
|
|
|
|
|
| Dr. Additional paid-in capital | 6,000 |
|
|
|
| Cr. Common stock |
|
| 6,000 |
|
| Dr. Common stock | 521 |
|
|
|
| Cr. Additional paid-in capital |
|
| 521 |
NOTE 4 – PRO FORMA EARNINGS PER SHARE
The pro forma earnings per share, giving effect to the share exchange transaction has been computed as follows:
| Net loss |
| $ | (1,027,703 | ) |
|
|
|
|
|
|
| Net loss per share – Basic and diluted |
| $ | (0.00 | ) |
|
|
|
|
|
|
| Weighted average number of shares deemed issued and outstanding |
|
| 9,800,000 |
|
| F-4 |
| This ‘8-K/A’ Filing | Date | Other Filings | ||
|---|---|---|---|---|
 | ||||
| Filed on: | 12/1/20 | None on these Dates | ||
| For Period end: | 11/25/20 | |||
| 9/30/20 | ||||
| List all Filings | ||||