Quarterly report pursuant to Section 13 or 15(d)

ACQUISITION

v3.19.1
ACQUISITION
6 Months Ended
Mar. 31, 2019
ACQUISITION [Abstract]  
ACQUISITION
NOTE 6 – ACQUISITION

Shift Now, Inc.

On August 28, 2018, the Company entered into a stock purchase agreement to acquire all of the outstanding capital stock of Shift Now for a total purchase price of $82,500.  The purchase price included 700,000 shares of our common stock with a value of $52,500 and a convertible promissory note for $30,000.  250,000 shares of the 700,000 shares are contingent on future performance targets.

The total purchase price for Shift Now was allocated as follows:

Intangible assets
 
$
129,924
 
Cash
   
123,625
 
Current assets
   
306,125
 
Note receivable – related party
   
3,183
 
Property and equipment
   
44,259
 
Line of credit
   
(98,310
)
Note payable
   
(30,000
)
Current liabilities
   
(396,306
)
Total net assets acquired
 
$
82,500
 
The purchase price consists of the following:
       
Convertible notes payable – related party
 
$
30,000
 
Common Stock
   
52,500
 
Total purchase price
 
$
82,500
 

Amortization of the intangible assets are deductible for tax purposes.

Intangible assets consist of customer base totaling $119,924 and trade name and trademarks totaling $10,000, with an estimated remaining useful life of 9 years and 5 years, respectively.

Proforma Information

The accompanying unaudited condensed consolidated financial statements include the results of operations of Shift Now for the six months ended March 31, 2019, of which Shift Now contributed approximately $1,168,000 of revenue and a net loss of approximately $76,000.

The following unaudited pro forma information presents the unaudited condensed consolidated results of the Company’s operations and the results of the acquisition of Shift Now had it been consummated on October 1, 2017. Such unaudited pro forma information is based on historical unaudited financial information with respect to the Shift Now acquisition and does not include operational or other charges which might have been affected by the Company, including any pro forma adjustments for amortization of intangible assets which approximates $1,277 per month. The unaudited pro forma information for the six months ended March 31, 2018 presented below is for illustrative purposes only and is not necessarily indicative of the results which would have been achieved or results which may be achieved in the future:

   
Three Months
Ended
March 31,
2018
   
Six Months
Ended
March 31,
2018
 
Net revenue
 
$
566,438
   
$
1,510,201
 
Cost of revenues
    308,392      
998,433
 
Operating expenses
    510,741      
1,034,390
 
Net loss
 
$
(262,207 )
 
$
(539,840
)
Net loss per share – basic and diluted
 
$
(0.01 )
 
$
(0.02
)