Exhibit 99.5
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
The following unaudited pro forma combined financial statements give effect to the Merger Agreement between Priced In Corp (“PRCD”), Priced In Corp. Subsidiary, Tigrent Inc. and Legacy Education Alliance Holdings, Inc. Immediately after the Merger consummation, the Company plans to change its name to Legacy Education Alliance, Inc. Of the then outstanding shares (19,997,500), 16,000,000 will be owned by Tigrent Inc, having exchanged their 10 shares in Legacy Education Alliance Holdings, Inc. (constituting 100% of Legacy Education Alliance Holdings, Inc. outstanding stock) and the remaining 3,997,500 shares will be held by the existing PRCD shareholders.
PRCD had 75,000,000 common shares authorized with a par value of $0.001 and on September 30, 2014 changed the par value to $0.0001 and increased the authorized shares by 125,000,000 to 200,000,000 shares with 12,750,000 shares outstanding. On October 1, 2014, PRCD completed a 1 for 1.23 Stock Split whereby each issued and outstanding share of PRCD common stock was converted into 1.23 share of PRCD (leaving 15,682,500 common shares). Upon closing of the Merger, 11,685,000 shares of the then outstanding 15,682,500 shares will be cancelled leaving 3,997,500 shares. Tigrent Inc. will exchange all of it shares in Legacy Education Alliance Holdings, Inc. (10 shares at $0.0001 par value common shares) for 16,000,000 shares of PRCD. After the merger, Tigrent Inc. will own 80% the then outstanding shares of PRCD.
The Merger will be accounted for as a “reverse merger” and recapitalization since, immediately following the completion of the transaction, the holders of Tigrent Inc.’s stock will have effective control of PRCD. In addition, Tigrent Inc. will have control of the combined entity through control of the Board by designating all four of the board seats to be held by the existing board of Tigrent Inc. Additionally, all of Tigrent Inc.’s officers and senior executive positions will continue on as management of the combined entity after consummation of the Merger. For accounting purposes, Legacy Education Alliance Holdings, Inc. will be deemed to be the accounting acquirer in the transaction and, consequently, the transaction will be treated as a recapitalization of PRCD. Accordingly, Legacy Education Alliance Holdings Inc.’s assets, liabilities and results of operations will become the historical financial statements of the registrant, and the Company’s assets, liabilities and results of operations will be consolidated with PRCD effective as of the date of the closing of the Merger. No step-up in basis or intangible assets or goodwill will be recorded in this transaction.
The unaudited pro forma combined balance sheet as of September 30, 2014 as well as the unaudited combined statements of operations for the years ended September 30, 2013 and 2014, presented herein, gives effect to the Merger as if the transaction had occurred at the beginning of such period and includes certain adjustments within the Stockholder’s Equity section that are directly attributable to the transaction.
The unaudited pro forma combined financial statements have been prepared for illustrative purposes only and are not necessarily indicative of the consolidated financial position or results of operations in future periods or the results that actually would have been realized had Legacy Education Alliance Holdings, Inc. and PRCD been a combined company during the specified periods. The unaudited pro forma combined financial statements, including the notes thereto, are qualified in their entirety by reference to, and should be read in conjunction with, the historical combined financial statements of Tigrent Inc. included herein, and the historical financial statements of PRCD included in its Annual Report on Form 10-K for the years ended September 30, 2013 and 2014.
Legacy
Education Alliance, Inc.
Pro Forma Condensed Combined Balance Sheet
As of September 30, 2014
(Unaudited In thousands)
| Tigrent
Inc. and Subsidiaries (Historical) | Legacy Education Alliance, Inc. F/K/A PRICED IN CORP. (Historical) | Adj # | Pro Forma Adjustments | Pro Forma Combined | ||||||||||||||||
| Assets | ||||||||||||||||||||
| Current assets: | ||||||||||||||||||||
| Cash and cash equivalents | $ | 4,569 | $ | 23 | - | $ | 4,592 | |||||||||||||
| Restricted cash | 2,489 | - | - | 2,489 | ||||||||||||||||
| Deferred course expenses | 9,453 | - | - | 9,453 | ||||||||||||||||
| Prepaid expenses and other current assets | 2,920 | - | - | 2,920 | ||||||||||||||||
| Income taxes receivable | 28 | - | - | 28 | ||||||||||||||||
| Inventory | 202 | - | - | 202 | ||||||||||||||||
| Total current assets | 19,661 | 23 | - | 19,684 | ||||||||||||||||
| Property and equipment, net | 1,364 | - | - | 1,364 | ||||||||||||||||
| Other assets | 245 | - | - | 245 | ||||||||||||||||
| Total assets | $ | 21,270 | $ | 23 | $ | - | $ | 21,293 | ||||||||||||
| Liabilities and Stockholders’ Deficit | ||||||||||||||||||||
| Current liabilities: | ||||||||||||||||||||
| Accounts payable | $ | 3,403 | $ | - | $ | - | $ | 3,403 | ||||||||||||
| Royalties payable | 111 | - | - | 111 | ||||||||||||||||
| Accrued course expenses | 1,275 | - | - | 1,275 | ||||||||||||||||
| Accrued salaries, wages and benefits | 869 | - | - | 869 | ||||||||||||||||
| Other accrued expenses | 2,769 | 15 | - | 2,784 | ||||||||||||||||
| Long-term debt, current portion | 9 | - | - | 9 | ||||||||||||||||
| Deferred revenue | 59,308 | - | - | 59,308 | ||||||||||||||||
| Total current liabilities | 67,744 | 15 | - | 67,759 | ||||||||||||||||
| Long-term debt, net of current portion | 54 | - | - | 54 | ||||||||||||||||
| Deferred revenue, net of current portion | 239 | - | - | 239 | ||||||||||||||||
| Other long-term liabilities | 63 | - | - | 63 | ||||||||||||||||
| Total liabilities | 68,100 | 15 | - | 68,115 | ||||||||||||||||
| Commitments and contingencies | ||||||||||||||||||||
| Stockholders’ deficit: | ||||||||||||||||||||
| Common Stock | 7,825 | 2 | A,B,C | (7,825 | ) | 2 | ||||||||||||||
| Additional paid-in-capital | 2,723 | 199 | A,B,C,D | 7,624 | 10,546 | |||||||||||||||
| Cumulative foreign currency translation adjustment | (351 | ) | - | - | (351 | ) | ||||||||||||||
| Accumulated deficit | (57,027 | ) | (193 | ) | D | 201 | (57,019 | ) | ||||||||||||
| Total stockholders’ deficit | (46,830 | ) | 8 | - | (46,822 | ) | ||||||||||||||
| Total liabilities and stockholders’ deficit | $ | 21,270 | $ | 23 | $ | - | $ | 21,293 | ||||||||||||
See Notes and Assumption to Unaudited Pro Forma Combined Financial Statements
| 2 |
Legacy
Education Alliance, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)
Twelve months ended September 30, 2014
(In thousands, except per share data)
| Tigrent Inc. and Subsidiaries Unaudited (Historical) | Legacy Education Alliance, Inc. F/K/A Priced In Corp. (Historical) | Pro Forma Unaudited Adjustments | Pro Forma Unaudited Combined | |||||||||||||
| Revenue | $ | 95,552 | $ | - | $ | - | $ | 95,552 | ||||||||
| Direct course expenses | 43,546 | - | - | 43,546 | ||||||||||||
| Advertising and sales expenses | 21,652 | - | - | 21,652 | ||||||||||||
| Royalty expense | 7,156 | - | - | 7,156 | ||||||||||||
| General and administrative expenses | 16,227 | 159 | - | 16,386 | ||||||||||||
| Income from operations | 6,971 | (159 | ) | - | 6,812 | |||||||||||
| Other income (expense): | ||||||||||||||||
| Forgiveness of debt | - | 10 | - | 10 | ||||||||||||
| Litigation settlement | 1,300 | - | - | 1,300 | ||||||||||||
| Other income (expense), net | 38 | - | - | 38 | ||||||||||||
| Income before income taxes | 8,309 | (149 | ) | - | 8,160 | |||||||||||
| (Provision) benefit for income taxes | 100 | - | - | 100 | ||||||||||||
| Net income (loss) | $ | 8,409 | $ | (149 | ) | $ | - | $ | 8,260 | |||||||
| Basic weighted average net income (loss) per share attributable to common stockholders: | ||||||||||||||||
| From continuing operations | $ | 0.56 | $ | (0.01 | ) | $ | 0.41 | |||||||||
| Diluted weighted average net income (loss) per share attributable to common stockholders: | ||||||||||||||||
| From continuing operations | $ | 0.53 | ||||||||||||||
| Basic weighted average shares outstanding | 14,911 | 10,992 | 19,998 | |||||||||||||
| Diluted weighted average shares outstanding | 15,878 | |||||||||||||||
See Notes and Assumption to Unaudited Pro Forma Combined Financial Statements
| 3 |
Legacy Education
Alliance, Inc.
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)
Twelve months ended September 30, 2013
(In thousands, except per share data)
| Tigrent Inc. and Subsidiaries Unaudited (Historical) | Legacy Education Alliance, Inc. F/K/A Priced In Corp. (Historical) | Pro Forma Unaudited Adjustments | Pro Forma Unaudited Combined | |||||||||||||
| Revenue | $ | 81,381 | $ | - | $ | - | $ | 81,381 | ||||||||
| Direct course expenses | 39,647 | - | - | 39,647 | ||||||||||||
| Advertising and sales expenses | 21,913 | - | - | 21,913 | ||||||||||||
| Royalty expense | 6,620 | - | - | 6,620 | ||||||||||||
| General and administrative expenses | 13,570 | 33 | - | 13,603 | ||||||||||||
| Income from operations | (369 | ) | (33 | ) | - | (402 | ) | |||||||||
| Other income (expense): | ||||||||||||||||
| Forgiveness of debt | 1,652 | - | - | 1,652 | ||||||||||||
| Litigation settlement | - | - | - | - | ||||||||||||
| Other income (expense), net | (356 | ) | - | - | (356 | ) | ||||||||||
| Income before income taxes | 927 | (33 | ) | - | 894 | |||||||||||
| (Provision) benefit for income taxes | 180 | - | - | 180 | ||||||||||||
| Net income (loss) from continuing operations | 1,107 | (33 | ) | - | 1,074 | |||||||||||
| Loss from discontinued operations | (167 | ) | - | - | (167 | ) | ||||||||||
| Loss from disposal of discontinued operations | (394 | ) | - | - | (394 | ) | ||||||||||
| Loss on discontinued operations | (561 | ) | - | - | (561 | ) | ||||||||||
| Net income (loss) | $ | 546 | $ | (33 | ) | $ | - | $ | 513 | |||||||
| Basic weighted average net income (loss) per share attributable to common stockholders: | ||||||||||||||||
| From continuing operations | $ | 0.08 | $ | (0.01 | ) | $ | 0.05 | |||||||||
| From discontinued operations | $ | (0.04 | ) | $ | 0.00 | $ | (0.03 | ) | ||||||||
| Net income attributable to Tigrent Inc.’s common stockholders | $ | 0.04 | $ | (0.01 | ) | $ | 0.02 | |||||||||
| Diluted weighted average net income (loss) per share attributable to common stockholders: | ||||||||||||||||
| From continuing operations | $ | 0.08 | ||||||||||||||
| From discontinued operations | $ | (0.04 | ) | |||||||||||||
| Net income attributable to Tigrent Inc.’s common stockholders | $ | 0.04 | ||||||||||||||
| Basic weighted average shares outstanding | 13,431 | 5,000 | 19,998 | |||||||||||||
| Diluted weighted average shares outstanding | 14,663 | |||||||||||||||
See Notes and Assumption to Unaudited Pro Forma Combined Financial Statements
| 4 |
NOTES AND ASSUMPTIONS TO PRO FORMA COMBINED FINANCIAL STATEMENTS
(Unaudited)
(A) On October 1, 2014 Priced In Corp. filed its First Amended and Restated Articles of Incorporation with the State of Nevada, pursuant to which it increased the total number of shares of capital stock which may be issued by PRCD to two hundred twenty million (220,000,000), of which:
(i) Two Hundred Million (200,000,000) shall be common stock, par value of $.0001 per share. Each share of Common Stock shall entitle the holder thereof to one (1) vote on any matter submitted to a vote at a meeting of the stockholders; and
(ii) Twenty Million (20,000,000) shall be preferred stock, par value of $.0001 per share.
(B) On October 1, 2014, PRCD affected an 1.23 for 1 stock split. The split was approved by PRCD’s stockholders and Board of
Directors.
(C) Legacy Alliance Holdings, Inc. (A wholly-owned subsidiary of Tigrent Inc.) will exchange its 10 $0.01 par common for 16,000,000 shares of PRCD.
(D) To eliminate the accumulated deficit of PRCD (the accounting acquiree).
Tigrent’s restricted shares have no effect on the combined company and therefore no pro forma diluted earnings per share information is presented.
The unaudited pro forma combined financial statements do not include any adjustment for non-recurring costs incurred or to be incurred after September 30, 2014 by both Tigrent and PRCD to consummate the Reverse Merger, except as noted above. Merger costs include fees payable for legal fees and accounting fees and are estimated to be approximately $800,000. Such costs will be expensed as incurred.
5