ORDERPRO LOGISTICS, INC.
(FORMERLY FIFTHCAI, INC.)
PROFORMA BALANCE SHEET
JULY 31, 2000
ASSETS
Current Assets
Cash and cash equivalents $ 1,483
Accounts receivable - trade 155,410
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Current Assets 157,193
--------
Property and equipment, net of accumulated depreciation 83,848
Deferred tax asset 198
--------
Total Assets $241,239
========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities
Current Liabilities
Accounts payable $111,339
Accrued liabilities 24,565
Income taxes payable 1,908
--------
Current Liabilities 137,812
--------
Total Liabilities 137,812
Stockholders' Equity
Common Stock - No par value, authorized 100,000,000 shares,
issued and outstanding 4,900,000 490
Additonal paid in capital 96,503
Retained Earnings 6,434
--------
Total Stockholders' Equity 103,427
--------
Total Liabilities and Stockholders' Equity $241,239
========
The accompanying notes are an integral part of these financial statements.
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ORDERPRO LOGISTICS, INC.
(FORMERLY FIFTHCAI, INC.)
PROFORMA STATEMENT OF INCOME
FOR THE PERIOD FROM INCEPTION TO JULY 31, 2000
Revenue $ 168,175
Direct cost of revenue 127,530
----------
Gross Profit 40,645
Expenses
Administrative costs 3,043
Amortization and depreciation 1,826
Rent and occupancy costs 8,354
Employee costs 19,278
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Total Costs 32,501
----------
Income before income taxes 8,144
Income tax expense 1,710
----------
Net Income $ 6,434
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Income per common share $ 0.00
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Weighted average shares outstanding 4,900,000
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The accompanying notes are an integral part of these financial statements.
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ORDERPRO LOGISTICS, INC.
(FORMERLY FIFTHCAI, INC.)
PROFORMA STATEMENT OF STOCKHOLDERS' EQUITY
FOR THE PERIOD FROM INCEPTION TO JULY 31, 2000
Common Stock Additonal
----------------- Paid In Retained
Shares Amount Capital Earnings Total
------ ------ ------- -------- -----
Balance at February 2, 2000,
date of incorporation 5,040,000 $ 504 $ 996 $ -- $ 1,500
Merger with OrderPro (140,000) (14) 95,507 95,493
Net Income 6,434 6,434
--------- ----- ------- ------- --------
Balance at July 31, 2000 4,900,000 $ 490 $96,503 $ 6,434 $103,427
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The accompanying notes are an integral part of these financial statements.
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ORDERPRO LOGISTICS, INC.
(FORMERLY FIFTHCAI, INC)
PROFORMA STATEMENT OF CASH FLOWS
FOR THE PERIOD FROM INCEPTION TO JULY 31, 2000
Income from operations $ 6,434
Adjustments to Reconcile Net Income From Operations
to Net Cash Provided by (from) Operating Activities:
Deferred tax asset (198)
Amortization and depreciation 1,826
---------
Net cash provided by operations 8,062
---------
Changes in Operating Assets and Liabilities
(Increase) in accounts receivable (155,410)
Increase in accounts payable 111,339
Increase in accrued liabilities 24,565
Increase in income taxes payable 1,908
---------
Net cash (used in) operating activities (17,598)
Cash Flows From Investing Activities
Acquisition of property and equipment (181)
---------
Net cash (used in) investing activities (181)
Cash Flows From Financing Activities
Sale of Common Stock 11,500
---------
Net cash provided by financing activities 11,500
Net increase in cash and cash equivalents 1,783
Cash and cash equivalents at beginning of period --
---------
Cash and cash equivalents at end of period $ 1,783
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The accompanying notes are an integral part of these financial statements.
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ORDERPRO LOGISTICS, INC.
(FORMERLY FIFTHCAI, INC.)
NOTES TO PROFORMA FINANCIAL STATEMENT
FOR THE PERIOD FROM INCEPTION TO ENDED JULY 31, 2000
NOTE 1 - THE COMPANY
OrderPro Logistics, Inc. (formerly FifthCAI, Inc.) (the "Company") was
incorporated in the state of Arizona on May 12, 2000. The Company had no
operations until July 2000. The Company provides freight brokerage, and
logistics services through internet access, on-sight presence and custom
designed software. The Company's year end is December 31.
FifthCAI, Inc. was incorporated on February 2, 2000 and had only limited
operations until the reverse acquisition with OrderPro Logistics on October 2,
2000. In conjunction with the reverse acquisition, FifthCAI, Inc. transferred
4,660,000 shares to the former stockholders of OrderPro, cancelled 140,000
shares of stock then outstanding, and changed its name to OrderPro Logistics,
Inc.
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES
REVENUE AND EXPENSE RECOGNITION - The Company recognized revenue when the
freight is tendered to the carrier at origin, and the Company records the
concurrent liability to the carrier and any other expenses related to shipment
for which the Company is liable. Where the Company does not assume the liability
for payment of expenses, or risk of collection it recognizes commission upon
performance of services.
ACCOUNTS RECEIVABLE - The Company recognizes revenue based on its revenue
recognition policy and provides an allowance for doubtful accounts based on the
Company's evaluation of credit worthiness and collection prospects for each
client. At July 31, 2000, all amounts are estimated to be collectible.
PROPERTY AND EQUIPMENT - Property and equipment are carried at cost less
accumulated depreciation. Cost was determined based on the depreciated carrying
value of the stockholder at the time the assets were placed in the Company.
Property and equipment is depreciated on a straight line basis over the
estimated useful life of the asset, ranging from three to seven years,
The Company is committed to completion of an internet and software system for
its internal use and potentially for sale or lease to third parties. The
remaining development costs related to completion of this asset is estimated to
be $200,000. The amounts expended for this programming and development are being
capitalized as an asset of the Company and depreciated over its estimated useful
life.
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ORDERPRO LOGISTICS, INC.
(FORMERLY FIFTHCAI, INC.)
NOTES TO PROFORMA FINANCIAL STATEMENT
FOR THE PERIOD FROM INCEPTION TO ENDED JULY 31, 2000
(continued)
NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (continued)
INCOME TAXES - Income taxes are accounted for under the asset and liability
method of accounting. Under this method, deferred tax assets and liabilities are
recognized for the future tax consequences attributable to differences between
the financial statement carrying amounts of existing assets and liabilities and
their respective tax bases and tax credit carryforwards. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable
income in years in which those temporary differences are expected to be
recovered or settled. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date.
NOTE 3. - PROPERTY AND EQUIPMENT
Property and equipment consist of the following:
Computers $13,772
Software and libraries 15,262
Internally developed software 45,341
Furniture and equipment 11,299
-------
85,674
Less: accumulated depreciation 1,826
-------
$83,848
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Depreciation expense for the period ended July 31, 2000 was $1,826.
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ORDERPRO LOGISTICS, INC.
(FORMERLY FIFTHCAI, INC.)
NOTES TO PROFORMA FINANCIAL STATEMENT
FOR THE PERIOD FROM INCEPTION TO ENDED JULY 31, 2000
(continued)
NOTE 4. - INCOME TAXES
Income tax expense for the period ended July 31, 2000 includes the following
components:
Federal State Total
------- ----- -----
Current $ 1,202 $ 706 $ 1,908
Deferred credit (143) (55) (198)
------- ------- -------
$ 1,059 $ 651 $ 1,710
======= ======= =======
Income tax expense differs from amounts computed by applying the U.S. Federal
income tax annualized rate of 15% to earnings before income taxes as a result of
the following:
Computed "expected" tax expense $1,387
Increase in income taxes resulting from:
State income taxes, net of Federal income tax benefit 521
------
$1,908
======
The tax effects of temporary differences that give rise to a deferred tax asset
at July 31, 2000 is the excess of financial statement deduction over tax
amortization of organizational expenses. The deferred tax asset is $198 to be
recognized for tax purposes over the next 59 months.
NOTE 5 - RELATED PARTY TRANSACTIONS
As part of the formation of the Company, the major stockholder contributed
furniture, property and related assets to the Company in exchange for stock of
the Company. These assets were recorded at the net depreciated value of the
assets held by the stockholders.
NOTE 6. - LEASE COMMITMENTS
The Company is obligated under a long term lease for office space in Tucson
Arizona. The annual lease payments require monthly payments of $3,521 with
annual escalation through May 31, 2003. Annual commitments for the calendar
years are as follows:
2000 $ 17,603
2001 43,478
2002 45,652
2003 19,406
NOTE 7 - STOCKHOLDERS' EQUITY
The Company has 100,000,000 shares of $0.0001 par value stock authorized and
4,900,000 shares outstanding at July 31, 2000 after giving effect to the
reorganization and related reverse acquisition between FifthCAI, Inc. and
OrderPro Logistics, Inc.
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