EX-99.3 6 ea145856ex99-3_fountain.htm PRO FORMA FINANCIAL INFORMATION

Exhibit 99.3

 

FOUNTAIN HEALTHY AGING, INC.

 

UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

 

FOR THE YEAR ENDED DECEMBER 31, 2020

 

 

 

 

On June 2, 2021, Fountain Healthy Aging, Inc. (“FHAI”) and FHAI’s subsidiary Shenzhen Wei Lian Jin Meng Electronic Commerce Limited entered into an equity transfer agreement with the Ms. Zhu Hong, who is the majority shareholder of FHAI and the sole owner of Shenzhen Nainiang Wine Industrial Co. Ltd. (“Nainiang Wine”) directly and indirectly, under which the FHAI group agreed to acquire 99% ownership of Shenzhen Nainiang Wine Industrial Co. Ltd.. The financial statements included herein present the financial position, results of operations and cash flows of Nainiang Wine for the year ended December 31, 2020.

 

FHAI agreed to issue 9,281,577 ordinary shares in exchange for 99% ownership of Nainiang Wine, and the shares is scheduled to be issued in the third quarter of 2021.

 

The operational control of Nainiang Wine passed to FHAI and all assets of Nainiang Wine were acquired by FHAI effective June 3, 2021. FHAI does not account for the remaining 1% non-controlling interest held by Ms. Zhu Hong as Ms. Zhu Hong is the common controlling shareholder for both the acquirer and the acquiree.

 

There were no significant accounting policy differences or other items which required adjustment in the accompanying unaudited pro forma combined financial statements.

 

The accompanying unaudited pro forma combined balance sheet gives effect to the acquisition as if it had been consummated on December 31, 2020. The accompanying unaudited pro forma combined statements of income for the year ended December 31, 2020, give effect to the acquisition as if it had been consummated on January 1, 2020.

 

The unaudited pro forma combined financial statements should be read in conjunction with the historical financial statements of Nainiang Wine (included herein) as well as those of FHAI. The unaudited pro forma combined financial statements do not purport to be indicative of the financial position or results of operations that would have actually been obtained had such transactions been completed as of the assumed dates and for the periods presented, or which may be obtained in the future. The pro forma adjustments are described in the accompanying notes and are based upon available information and certain assumptions that FHAI believes are reasonable.

 

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FOUNTAIN HEALTHY AGING, INC.

UNAUDITED PRO FORMA COMBINED BALANCE SHEET

AS OF DECEMBER 31, 2020

 

   FHAI   Nainiang Wine   Pro Forma Adjustments   Notes  Pro Forma 
ASSETS                   
Current assets:                   
   Cash and cash equivalents  $61,517   $2,191   $           $63,708 
   Accounts receivables   -    212,664            212,664 
   Other receivables   101,432    -            101,432 
   Inventory   66,037    -            66,037 
   Prepayment   133,646    -            133,646 
   Amount due from related parties   142,450    611,064    (10,768)  (b)   742,746 
Total current assets   505,082    825,919            1,320,233 
                        
Non-current assets:                       
   Property, plant and equipment, net  $87,333   $340,286   $       $427,619 
   Operating lease right-of-use assets   383,203    -            383,203 
Total non-current assets   470,536    340,286            810,822 
Total assets   975,618    1,166,205            2,131,055 
                        
LIABILITIES AND EQUITY                       
Current liabilities:                       
   Accounts payable  $134,842   $77,332   $       $212,174 
   Income tax payables   31,774    170,516            202,290 
   Other payables and accruals   336,604    61,852            398,456 
   Deferred revenue   27,648    95,316            122,964 
   Amount due to related parties   1,097,152    35,842    (10,768)  (b)   1,122,226 
   Current operating lease liabilities   319,697    -            319,697 
Total current liabilities   1,947,717    440,858            2,377,807 
                        
Non-current liabilities:                       
   Deferred revenue   -    94,254            94,254 
   Non-current operating lease liabilities   63,506    -            63,506 
Total non-current liabilities   63,506    94,254            157,760 
Total liabilities   2,011,223    535,112            2,535,567 
                        
COMMITMENTS AND CONTINGENCIES                       
                        
EQUITY (DEFICIT)                       
   Series A preferred Stock  $1,000   $-   $       $1,000 
   Common stock   6,000    -    93   (a)   6,093 
   Additional paid-in capital   (15,146)   -    631,000   (a)   615,854 
   Foreign currency translation reserves   (54,091)   33,826    (33,826)  (a)   (54,091)
   Statutory reserves   -    94,664    (94,664)  (a)   - 
   Retained earnings   (973,368)   502,603    (502,603)  (a)   (973,368)
Total equity (deficit)   (1,035,605)   631,093            (404,512)
Total liabilities and equity   975,618    1,166,205            2,131,055 

 

See accompanying notes to unaudited pro forma combined financial statements.

 

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FOUNTAIN HEALTHY AGING, INC.

UNAUDITED PRO FORMA COMBINED STATEMENTS OF OPERATIONS

FOR THE YEAR ENDED DECEMBER 31, 2020

 

   FHAI   Nainiang Wine   Pro Forma Adjustments   Notes   Pro Forma 
REVENUES  $1,194,427   $1,861,039   $                     $3,055,466 
                          
COST OF REVENUES   (176,393)   (864,243)             (1,040,636)
                          
GROSS PROFIT   1,018,034    996,796              2,014,830 
                          
Selling and marketing   (108,364)   (135,778)             (244,142)
General and administrative   (1,519,552)   (63,891)             (1,583,443)
Total operating expenses   (1,627,916)   (199,669)             (1,827,585)
                          
INCOME (LOSS) FROM OPERATIONS   (609,882)   797,127              187,245 
                          
OTHER INCOME (EXPENSES), NET   1,705    (332)             1,373 
                          
INCOME (LOSS) BEFRE INCOME TAXES   (608,177)   796,795              188,618 
                          
INCOME TAXES   (19,693)   (199,528)             (219,221)
NET INCOME (LOSS)   (627,870)   597,267              (30,603)
                          
Foreign currency translation difference   (58,638)   33,826              (24,812)
TOTAL COMPREHENSIVE INCOME (LOSS)   (686,508)   631,093              (55,415)
                          
NET LOSS PER SHARE                         
BASIC  $(0.001)                 $(0.000)
DILUTED  $(0.001)                 $(0.000)
                          
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING                         
BASIC   600,034,500         9,281,577         609,316,077 
DILUTED   600,034,500         9,281,577         609,316,077 

 

See accompanying notes to unaudited pro forma combined financial statements.

 

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FOUNTAIN HEALTHY AGING, INC.

NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS

 

1. BASIS OF PRESENTATION

 

The historical consolidated financial statements have been adjusted in the pro forma combined financial statements to give effect to pro forma events that are (1) directly attributable to the business combination, (2) factually supportable and (3) with respect to the pro forma combined statements of operations, expected to have a continuing impact on the combined results following the business combination. The business combination was accounted for under common control in accordance with ASC Topic 805, Business Combinations. The pro forma combined financial statements do not necessarily reflect what the combined financial condition or results of operations would have been had the acquisition occurred on the dates indicated. They also may not be useful in predicting the future financial condition and results of operations of the combined company. The actual financial position and results of operations may differ significantly from the pro forma amounts reflected herein due to a variety of factors.

 

2. PRO FORMA ADJUSTMENTS AND ASSUMPTIONS

 

The pro forma adjustments are based on management preliminary estimates and assumptions that are subject to change.

 

(a)To record the share consideration to be paid for the acquisition of 99% of the equity of Nainiang Wine.

 

(b)To eliminate the balances between FHAI and Nainiang Wine.

 

3. EARNINGS PER SHARE

 

The following table illustrates the calculation of pro forma earnings per share:

 

   Year ended
December 31, 2020		 
Pro forma net loss  $30,603 
      
Weighted-average shares outstanding:     
Pro forma shares   609,316,077 
      
Earnings per share     
Basic and diluted  $0.000 

 

 

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