EFTA00608160.pdf

COMPLIANCE CERTIFICATE In connection with the Series AA Preferred Stock Purchase Agreement dated as of September 16, 2013, as amended on April 28, 2014 and on July 9, 2014 (as amended, the "Agreement"), by and between Blue Talon Data Systems, Inc., a Delaware corporation (the "Company"), and the Purchasers set forth Exhibit A attached thereto (the "Purchasers"), Pratik Verma certifies that he is the duly elected and acting President of the Company, and further certifies on behalf of the Company that: (i) except as set forth on the updated Disclosure Schedule attached hereto as Exhibit A, the representations and warranties of the Company in Section 2 of the Agreement are true and correct as of the date hereof; (ii) except as set forth on the updated Disclosure Schedule attached hereto as Exhibit A, all covenants, agreements, obligations and conditions contained in the Agreement to be performed or complied with by the Company on or prior to the date hereof have been so performed or complied with. IN WITNESS WHEREOF, the undersigned has hereunto set his hand as President of the Company as of the date first written above. BLUE TALON DATA SYSTEMS, INC. By: Pratik Verma, President 1218220 v2tHN EFTA00608160 EXHIBIT A DISCLOSURE SCHEDULE In connection with that certain (i) Series AA Preferred Stock Purchase Agreement dated as of September 16, 2013, as amended on April 28, 2014 and on July 9, 2014, by and among Blue Talon Data Systems, Inc. (the "Company") and the investors listed on Exhibit A attached thereto (the "Purchase Agreement"), and (ii) Investors' Rights Agreement dated as of September 16, 2013, as amended on April 28, 2014, by and among the Company and each of the investors listed on Schedule A thereto (the "Rights Agreement"), the Company hereby delivers this Disclosure Schedule to the Company's representations and warranties given in the Purchase Agreement and the to the Company's covenants in the Rights Agreement. This Disclosure Schedule and the information and disclosures contained herein are intended only to qualify and limit the representations, warranties and covenants of the Company contained in the Purchase Agreement and the Rights Agreement, as applicable, and shall not be deemed to expand in any way the scope or effect of any of such representations, warranties or covenants. The section numbers in this Disclosure Schedule correspond to the section numbers in the Purchase Agreement or Rights Agreement as indicated; provided, however, that any information disclosed herein under any section number shall be deemed to be disclosed and incorporated in any other section of the Purchase Agreement or Rights Agreement, as applicable, where such disclosure would be appropriate and reasonably apparent. Disclosure of any information or document herein is not a statement or admission that it is material or required to be disclosed herein. References to any document do not purport to be complete and are qualified in their entirety by the document itself. Capitalized terms used but not defined herein shall have the same meanings given them in the Purchase Agreement. Purchase Agreement 2.2(a) Total Authorized Shares: Common Stock 17.142.857 Series AA Preferred Stock 7.142.857 Outstanding Fully diluted Percent% Issued/Reserved: Common Stock 6.899.663 6.899.663 55.73% Series AA Preferred Stock 2.380.952 2.380.952 19.23% 2013 Stock Plan (3.860.000 reserved) Options Outstanding 1.876.050 1.876.050 15.15% Options Committed for Issuance 0 0.00% Available for Issuance 1.224.287 9.89% TOTAL: 11.156.665 12.380.952 100.00% I 2 I K220 c-2/1-IN EFTA00608161 2.2(b) There are 1,876,050 options to purchase shares outstanding, 171,428 shares of Common Stock issued under the Stock Plan and 1,224,287 shares of Common Stock remain availabale under the Stock Plan. Employment Agreement between Eric Tilenius and the Company dated June 21, 2014, as amended ("Eric's Employment Agreement"). 2.2(c) Eric's Employment Agreement. Notice of Stock Option Grant (Early Exercise) dated February 7, 2014 between Eric Tilenius and the Company. Early Exercise Stock Purchase Agreement (Under the 2013 Stock Plan) dated February 27, 2014 between the Company and Eric Tilenius ("Eric's Early Exercise Agreement"). 2.2(d) Eric's Employment Agreement. 2.6 The Company will file a Form D with the SEC with regards to the shares of Series AA preferred stock issued under the Series AA Preferred Stock Purchase Agreement, as amended, following the subsequent closing(s). 2.8 The UHG Agreement (as defined below). The Lilly Agreement (as defined below). Blue Talon — "Proof of Concept" Evaluation Agreement between the Company and IMS Health, Incorporated, dated July 14, 2014. BlueTalon name and logo is a trademark of the Company. Notice of Allowance issued January 21, 2014 by the USPTO for the mark BlueTalon (registration number 86-004,800). 2.10(a) Master Services Agreement between the AgeTak, Inc. and United HealthCare Services, Inc., dated May 15, 2007 and any amendments thereto and Software License Agreement between AgeTak, Inc. and Ingenix, Inc., dated December 28, 2007 and any amendments thereto (collectively, the "UHG Agreement"). Commercial Unmodified Software License Agreement between the AgeTak, Inc. and Eli Lilly, dated December 31 2012 and any amendments thereto (the "Lilly Agreement"). Agreement between the AgeTak, Inc. and DB Research Pvt. Ltd., dated Januaryl, 2011 and any amendments thereto. 2. 1218220 v2/1-1N EFTA00608162 Standard Multi-Tenant Office Lease (Gross) between the Company and White & Less Investments, L.P. dated December 13, 2013 for the premises at 541 Jeferson Avenue, Suite 202, Redwood City, San Mateo 94063. Employment offer letters with employees of the Company that are at-will. 2.10(b) Full Recourse Promissory Note in the principal amount of $99,999.95 dated February 27, 2014 issued by Eric Tilenius to the Company ("Eric's Note") and Stock Pledge Agreement dated February 27, 2014 with respect to 588,235 shares of Common Stock ("Eric's Pledge Agreement") entered into in connection with Eric's Early Exercise Agreement. 2.11(a) Eric's Note and Eric's Pledge Agreement. 2.11(b) Prerna Verma and Rakesh Khanduja are the two directors of DB Research. Pratik Verma and Prerna Verma also have a membership interest in AgeTak Holdings, LLC. Eric's Note. 2.14 See Attachment A hereto for financial statements of the Company as at May 31, 2014 and for the periods set forth therein. Legal fees in connection with services provided by Cooley LLP related to the amendments of the Transaction Documents and investment by the Purchasers in subsequent Closings. AgeTak, Inc. issued warrants to Mark Tibbles and Scott Schwefel in 2006 that have not been exercised. Rights Agreement 5.7 The Company hired Eric Tilenius as Chief Executive Officer on January 21, 2014 and the stockholders elected Eric Tilenius as Director (holding the CEO Director seat) of the Company on January 21, 2014, and Pratik Verma remained the President of the Company and the stockholders elected Pratik Verma as Director (holding the Common Stock seat) at such time. Also at such time, the stockholders elected Scott Barclay as Director (holding the independent seat) of the Company. The Company has not appointed an Executive Chairman. 12 18220 v2/HN EFTA00608163 Blue Talon Balance Sheet AS Of nay 31. 2014 Attachment A 132 PIA 06107014 Accrual Inas Jan 31 14 Feb 2614 M 31.14 let 30.14 nest 31 14 ASSETS Current Asian ChonInglashqs 10300 Cash IWO Wets Eger. Catecken4S1 T 572193 51377.47 79.091.81 04.600.71 1631275 10020 Weds Fargo Seenn .4782 110034703 605.42159 71040685 55169037 47134909 ICOZ1D Cenci Card Checking .. 0358 9001 57 9.00177 900200 1500148 10.033 73 Ten 10000 Cash 1.075007053 946.00083 79358281 652377.56 49766217 TelalChenastlansts 1.075.07053 94600083 79158281 652377.56 49766217 Othe. Cunenl Ansel; ism Prepild Enteases 1.18159 1.07418 421277 7.45136 63x95 14100- Security Droolas 9.00130 900130 9.00130 500130 9.00130 Telal Other Cunha Assets 10.18288 10.175.48 11.264.07 16.45266 1863125 Taal Oaten Assets flied Antes 15000- Need Assele 15100 Furniture and Miens 1.04525142 000 956.07631 141780 811.84688 1417.80 66483622 3.41780 516.49362 3.41730 15199 Furniture and Salton - AD 000 000 .11192 .17063 15300 Cempulor Equipmen1 000 1.785.36 1.78516 573427 1815.12 15399 CempulorEquipmanl. AD 000 000 .4059 9518 .258-46 Total 15000- Fired bent 000 526111 5.15227 193697 102031$ Total Find Assets 000 520116 515227 193197 10.80316 Other Anal, '000. 0104( Assets 16100 Intangible Assets 206200 205200 205200 2.05200 2.16240 Total 16030 CICher Assets 2.062110 205200 205200 2.05200 Toni Olni Assets 266200 2.05200 2.05200 205200 205200 TOTAL ASSETS 1.08710042 963331.47 815061.15 670821.09 529.349.40 LIASILMIS 8101/eTT Current Inbilints Accounts Payable 20000 ACCOLIIIIS Payable 32621 50 40924 27 24 69155 7.02650 SO 3S7 CO Ten nenunls Panne 32621 50 40924.27 24.69155 7.02150 SO 3S7 CO Cita Ca101. 22100 Credit Cads Prank Cr odilCard 8140 2 383 62 243162 1513942 11.741.98 843623 Tent 22500 Credit Cards 138362 243162 3-63942 11.741.98 843623 Telal Cred4 Cards 2 383 62 243162 158142 11.741,98 813623 Other Current Llebffitles 23003- Expenster Clettung 000 000 000 249484 1113S) 21310 netted !sprees 000 000 000 131000 1.34910 Telal Other Curren Liabilillos 0110 000 000 184184 323230 Ton, Cuneet LLI00.0ee 3413012 43.35989 2620297 2261232 6228359 Tend LLI00.0ee 433012 43.35989 2620297 2261232 6226359 [guile 30000 Capital Sunk 30100 Capital Contributed 301001 Legal Fen-Fnancing 48.2/186 4325386 6825186 -tunes .77.16136 Tela1 30100 Capin ContrIbund 18.233.86 6825386 6425186 -6025186 .17.16336 30200 Cease, Sink 8385966 8185966 8185566 8185566 83059.66 30300- Preferred Sion 303061 - Series AA Preferred 1.499.99)90 1.499.99990 1.499.99090 1.490993.90 1.499.939 93 Pap 1014 EFTA00608164 Jan 21 14 F4025.14 Yv21. 14 Apr 30.14 Nay31.14 Tool 30300 Prelerted Slack 1483933$0 199803890 1.49293090 1.422993.90 1.49.292092 Tom 30000 Capnal Slack 1515105 70 1515505 70 151550570 151560520 1.50657620 31000 9404e0 Earnings .286.41228 .28041228 .280.41228 .2(45.41228 .25641225 264 Income .17451612 40722184 .45542524 •56490& .55 .15120&.11 4404 1040 106257530 91957150 70376115 657.205217 46203341 TOTAL LIABILITIES 610U112 LOST201312 1161.331A1 81 S1.10 520.340410 Pan2sI24 EFTA00608165 EqueTolon Profil & Loss by Month-Tolal Janox y ilwough Un 2011 0~3 1...mive E gnege b04144 (MO 0.34twiw3 130.e.... 01101 4/.0..........4 I. 41r 1411.0 (01» lOnlane 14 feb14 LY li Mr H W)4 333 Pli 114.102.1.1. ~41~ 10Tø T >bi 1250 CO 000 000 09-> 1233 1.3 c000 On. 14..0.0 ON 0W 111.300 000 OS 13 123 CO 40170 2.....t • ::€>:•.cr.re P«, 14,3 CO 10º11) 123330 111302 21251 n it4m1orco 4.3/tanni.e. V......sai 7913 51$0 CO 4f.:€47 , SSIO 5.115.0) 334X6) 010)3 Cenp..41. 11130 3414/1e. 41100.1. 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Amentencn yaw ['mot< iuun E genie 0.1* 0R 60.111 .1221 2162E 423 3,4 TS. 620:0 drain log • ...Man°, 0.1* 0R 60* 4221 116,24 a$01 4)))) 14.n Eiparmei *MO Tsars 41024 Swot Lewin's 0* 0R 01# °SIN 000 • 4.5)50 Inn IWO Taws OCO 0 Of OCO 1.799 040 TV000Y0 One C.v., OM 0R 01# 101360 000 +50100 kw got fftenie 010 0R 60.1 14670 21624 I...4T *MO/et ware la* N,O It* -10.166 1 ‘510:"... He Oxon. 494111.11 .110.20.40 .114411131 .010211.01 •niarre Pop 4 Of al EFTA00608167 Blue Talon Statement of Cash Flows-Current Month May 2014 OPERATING ACTIVITIES Net Income Adjustments to reconcile Net Income to net cash provided by operations: 13000 Prepaid Expenses 20000 . Accounts Payable 22500 . Credit Cards:Pratik Credit Card - 8460 23005 . Expensify Clearing Net cash provided by Operating Activities 3:32 PM 06/1012014 May 14 -181.215.56 -2.378.59 43.330.50 -3.105.69 -551.54 -143.920.88 INVESTING ACTIVITIES 15000 . Fixed Assets:15199 Furniture and Fixtures - AD 56.96 15000 - Fixed Assets:15300 Computer Equipment -2.080.85 15000 - Fixed Assets:15399 • Computer Equipment- AD 159.28 Net cash provided by Investing Activities 1.864.61 FINANCING ACTIVITIES 30000 Capital Stock:30100 . Capital Contributed:30100.2 Legal Fees-Financing Net cash provided by Financing Activities Net cash increase for period Cash at beginning of period Cash at end of period 8.929.50 8.929.50 -154.714.99 652.377.56 497.66237 Page 5 of 24 EFTA00608168 Blue Talon Profit & Loss by Class-Current Month May 2014 Ordinary Income:Expense Expense 60000 . Operating Expenses 60100 • Advertising & Marketing 001-GA 002-SALES 60170 . Events & Sponsorship 0.00 0.00 Total 60100 . Advertising & Marketing 0.00 0.00 61000 • Compensation 61100 . Salaries 61100-1 • Salaries Reg 5.865.39 17.500.00 61100-3 . Officers Salaries 19.583.34 12.500.00 Total 61100 • Salaries 25.448.73 30.000.00 61400 . Benefits 61410 • Health Care 3,296.00 0.00 61440 • Other Benefits 4.00 0.00 Total 61400 • Benefits 3,300.00 0.00 61500 . Payroll Taxes 61510 • FICANIED 2,903.07 1338.76 61520 • FUTA 42.00 0.00 61530 • State 245.00 0.00 Total 61500 • Payroll Taxes 3,190.07 1338.76 Total 61000 . Compensation 31,938.80 31338.76 62000 • T &E 62110 . Airfare 745.00 540.00 62120 Ground Transportation 0.00 447.59 62130 . Fuel - Mileage 0.00 11.47 62310 . Meals - Internal 0.00 392.61 62320 . Meals & Ent - External 0.00 106.77 Total 62000 . T & E 745.00 1,498.44 63000 • Consulting 63100 . Consulting fees 15.000.00 0.00 Total 63000 . Consulting 15,000.00 0.00 64000 • Recruiting & Relocation 64100 . Recruiter Fees 30.000.00 0.00 Total 64000 . Recruiting & Relocation 30.000.00 0.00 Page 6 of 24 EFTA00608169 65000 . General & Admin Fees 65010 • Legal Fees 001-GA 002-SALES 65010-1 • Legal Fees- General 15,389.00 0.00 Total 65010 . Legal Fees 15,389.00 0.00 65020 • Insurance 65020-1 • General Insurance 107.41 0.00 65020.2 • Workers Compensation 129.40 0.00 Total 65020 . Insurance 236.81 0.00 65050 • Payroll Fees 175.84 0.00 65100 • Finance & Admin 65110 HR 729.17 0.00 65120. Accounting 1,020.83 0.00 Total 65100 . Finance & Admin 1,750.00 0.00 65210 • Computer Equipment -Hardware 660.32 0.00 65220 • Computer Equipment - Software 1/72.00 0.00 65320 • Tech Subscriptions 6.313.41 0.00 65420 • Office Expenses 3,676.25 0.00 65430 • Office Supplies 167.19 0.00 65440 • Printing & Reproduction 277.95 0.00 65500 • Rent 4,500.00 0.00 65510 • Facilities Expense 0.00 0.00 65540 • Telephone & Fax 20.00 0.00 65550 • Internet 202.23 0.00 65915 • Licenses & Fees 1.512.40 0.00 Total 65000 • General & Admin Fees 36.653.40 0.00 Total 60000. Operating Expenses 114.337.20 32.837.20 Total Expense 114.337.20 32,837.20 Net Ordinary Income -114.337.20 -32,837.20 Other Income/Expense Other Income 81000. Other Income 81100 . Interest Income 44.36 0.00 Total 81000 . Other Income 44.36 0.00 Total Other Income 44.36 0.00 Other Expense Page 7 of 24 EFTA00608170 82000 . Depreciation & Amortization 001•GA 002•SALES 82100 Depredation Expense 216.24 0.00 Total 82000 . Depredation & Amortization 216.24 0.00 Total Other Expense 216.24 0.00 Net Other Income -171.88 0.00 Net Income 414.509.08 .32,837.20 Page 8 of 24 EFTA00608171 Blue Talon Profit & Loss by Class-Current Month May 2014 Ordinary Incometxpense Expense 60000 Operating Expenses 60100 • Advertising & Marketing 003-PARTNER SALES 004-MARKETING 60170 . Events & Sponsorship 0.00 5.115.00 Total 60100 . Advertising & Marketing 0.00 5.115.00 61000 • Compensation 61100 . Salaries 61100-1 • Salaries Reg 12300.00 0.00 61100-3. Officers Salaries 0.00 0.00 Total 61100 • Salaries 12300.00 0.00 61400 . Benefits 61410 • Health Care 0.00 0.00 61440 • Other Benefits 0.00 0.00 Total 61400 • Benefits 0.00 0.00 61500 . Payroll Taxes 61510 • FICANIED 956.26 0.00 61520 • FUTA 0.00 0.00 61530 • State 0.00 0.00 Total 61500 • Payroll Taxes 956.26 0.00 Total 61000 . Compensation 13,456.26 0.00 62000 • T &E 62110 . Airfare 0.00 0.00 62120 - Ground Transportation 0.00 0.00 62130 . Fuel - Mileage 0.00 0.00 62310 . Meals - Internal 0.00 0.00 62320 . Meals & Ent - External 0.00 0.00 Total 62000 . T & E 0.00 0.00 63000 • Consulting 63100 . Consulting fees 0.00 0.00 Total 63000 . Consulting 0.00 0.00 64000 • Recruiting & Relocation 64100 . Recruiter Fees 0.00 0.00 Total 64000 . Recruiting & Relocation 0.00 0.00 Page 9 of 24 EFTA00608172 65000 . General & Admin Fees 65010 • Legal Fees 003-PARTNER SALES 004-MARKETING 65010-1 • Legal Fees- General 0.00 0.00 Total 65010 . Legal Fees 0.00 0.00 65020 • Insurance 65020.1 • General Insurance 0.00 0.00 65020.2 . Workers Compensation 0.00 0.00 Total 65020 . Insurance 0.00 0.00 65050 • Payroll Fees 0.00 0.00 65100 • Finance & Admin 65110 . HR 0.00 0.00 65120 • Accounting 0.00 0.00 Total 65100 . Finance & Admin 0.00 0.00 65210 . Computer Equipment -Hardware 0.00 150.08 65220 • Computer Equipment - Software 0.00 0.00 65320 • Tech Subscriptions 0.00 0.00 65420 • Office Expenses 0.00 0.00 65430 • Office Supplies 0.00 0.00 65440 • Printing & Reproduction 0.00 0.00 65500 • Rent 0.00 0.00 65510 • Facilities Expense 0.00 0.00 65540 • Telephone & Fax 0.00 0.00 65550 • Internet 0.00 0.00 65915 • Licenses & Fees 0.00 0.00 Total 65000 • General & Admin Fees 0.00 150.08 Total 60000 . Operating Expenses 13.456.26 5,265.08 Total Expense 13.456.26 5,265.08 Net Ordinary Income -13.456.26 -5,265.08 Other Income/Expense Other Income 81000. Other Income 81100 • Interest Income 0.00 0.00 Total 81000 • Other Income 0.00 0.00 Total Other Income 0.00 0.00 Other Expense Page 10 of 24 EFTA00608173 82000 . Depreciation & Amortization 003-PARTNER SALES 004-MARKETING 82100 . Depreciation Expense 0.00 0.00 Total 82000 . Depreciation & Amortization 0.00 0.00 Total Other Expense 0.00 0.00 Net Other Income 0.00 0.00 Net Income -13,456.26 -5,265.08 Page 11 of 24 EFTA00608174 Blue Talon Profit & Loss by Class-Current Month May 2014 3:32 PM 06/1012014 Accrual Basis Ordinary Income:Expense Expense 60000 Operating Expenses 60100 • Advertising & Marketing 008-TECH OPS 009-RD TOTAL 60170 . Events & Sponsorship 0.00 0.00 5.115.00 Total 60100 . Advertising & Marketing 0.00 0.00 5.115.00 61000 • Compensation 61100 . Salaries 61100-1 • Salaries Reg 12.500O0 0.00 48.365.39 61100-3. Officers Salaries 0.00 0.00 32.08134 Total 61100 • Salaries 12.500.00 0.00 80.448.73 61400 . Benefits 61410 • Health Care 0.00 0.00 3.296.00 61440 • Other Benefits 0.00 0.00 4.00 Total 61400 • Benefits 0.00 0.00 1300.00 61500 . Payroll Taxes 61510 • FICANIED 956.26 0.00 6.154.35 61520 • FUTA 14.31 0.00 56.31 61530 • State 83.46 0.00 328.46 Total 61500 • Payroll Taxes 1.054.03 0.00 6.53912 Total 61000 . Compensation 13.554.03 0.00 90.287.85 62000 • T & E 62110 . Airfare 0.00 0.00 1.285.00 62120 - Ground Transportation 0.00 0.00 447.59 62130 . Fuel - Mileage 0.00 0.00 11.47 62310 . Meals - Internal 0.00 0.00 392.61 62320 . Meals & Ent - External 0.00 0.00 106.77 Total 62000 . T & E 0.00 0.00 2.24144 63000 • Consulting 63100 . Consulting fees 0.00 0.00 15.000.00 Total 63000 . Consulting 0.00 0.00 15.000.00 64000 • Recruiting & Relocation 64100 . Recruiter Fees 0.00 0.00 3O000.00 Total 64000 . Recruiting & Relocation 0.00 0.00 3O000.00 Page 12 of 24 EFTA00608175 65000 . General & Admin Fees 65010 • Legal Fees 008-TECH OPS 009-RD TOTAL 65010.1 • Legal Fees• General 0.00 0.00 15.389.00 Total 65010 . Legal Fees 0.00 0.00 15.38900 65020 • Insurance 65020-1 • General Insurance 0.00 0.00 107.41 65020.2 • Workers Compensation 0.00 0.00 129.40 Total 65020 . Insurance 0.00 0.00 236.81 65050 • Payroll Fees 0.00 0.00 175.84 65100 • Finance & Admin 65110 . HR 0.00 0.00 729.17 65120 • Accounting 0.00 0.00 1.02O83 Total 65100 . Finance & Admin 0.00 0.00 1.75O00 65210 • Computer Equipment -Hardware 0.00 0.00 810.40 65220 • Computer Equipment - Software 873.00 54.95 1699.95 65320 • Tech Subscriptions 0.00 0.00 6.31141 65420 • Office Expenses 528.19 0.00 4.20444 65430 • Office Supplies 0.00 0.00 167.19 65440 • Printing & Reproduction 0.00 0.00 277.95 65500 • Rent 0.00 0.00 4.50O00 65510 • Facilities Expense 28.69 0.00 28.69 65540 • Telephone & Fax 0.00 109.08 129.08 65550 • Internet 0.00 0.00 202.23 65915 • Licenses & Fees 0.00 0.00 1.512.40 Total 65000 • General & Admin Fees 1.429.88 164.03 38.397.39 Total 60000 . Operating Expenses 14.983.91 164.03 181.04168 Total Expense 14983.91 164.03 181.04168 Net Ordinary Income -14.983.91 164.03 181.043.68 Other Income/Expense Other Income 81000. Other Income 81100 • Interest Income 0.00 0.00 44.36 Total 81000 • Other Income 0.00 0.00 44.36 Total Other Income 0.00 0.00 44.36 Other Expense Page 13 of 24 EFTA00608176 82000 . Depreciation & Amortization 008-TECH OPS 009-RD TOTAL 82100 Depreciation Expense 0.00 0.00 216.24 Total 82000 . Depreciation & Amortization 0.00 0.00 216.24 Total Other Expense 0.00 0.00 216.24 Net Other Income 0.00 0.00 -171.88 Net Income -14,983.91 -164.03 -181.215.56 Page 14 of 24 EFTA00608177 Blue Talon Profit & Loss by Class-YTD January through May 2014 Ordinary IncomelExpense Expense 60000 • Operating Expenses 60100 • Advertising & Marketing 001-GA 002-SALES 60130 . Advertising 0.00 0.00 60160 . Other Marketing 0.00 0.00 60170 • Events & Sponsorship 0.00 0.00 Total 60100 • Advertising & Marketing 0.00 0.00 61000 • Compensation 61100 • Salaries 61100-1 • Salaries Reg 55.865.39 37300.00 61100-3 • Officers Salaries 86.467.98 62.500.00 Total 61100 • Salaries 142,333.37 100,000.00 61400 • Benefits 61410 • Health Care 19,776.00 0.00 61440 • Other Benefits 3.258.00 0.00 Total 61400 • Benefits 23,034.00 0.00 61500 • Payroll Taxes 61510 • FICA/MED 11,844.77 6,693.80 61520 • FUTA 315.00 84.00 61530 • State 723.60 490.00 Total 61500 • Payroll Taxes 12,883.37 7.267.80 Total 61000 . Compensation 178.250.74 107.267.80 62000 • T & E 62110 • Airfare 3,797.85 936.00 62120 Ground Transportation 411.40 447.59 62130 • Fuel - Mileage 0.00 11.47 62210 • Hotel Room Charges 719.67 0.00 62310 • Meals - Internal 279.66 392.61 62320 • Meals & Ent - External 8.00 106.77 62400 • Registration Fees 0.00 0.00 Total 62000 • T & E 5,216.58 1,894.44 63000 • Consulting 63100 . Consulting fees 130.259.27 0.00 Total 63000 . Consulting 130.259.27 0.00 Page 15 of 24 EFTA00608178 64000. Recruiting & Relocation 001-GA 002-SALES 64100 • Recruiter Fees 30.000.00 0.00 Total 64000 • Recruiting & Relocation 30.000.00 0.00 65000 . General & Admin Fees 65010 • Legal Fees 65010-1 • Legal Fees- General 84.890.97 0.00 Total 65010 . Legal Fees 84,890.97 0.00 65020 • Insurance 65020.1 • General Insurance 537.05 0.00 65020-2 • Workers Compensation 585.46 0.00 Total 65020 . Insurance 1,122.51 0.00 65050 • Payroll Fees 910.33 0.00 65060 • Bank Fees -51.08 0.00 65100 - Finance & Admin 65110 . HR 2,708.33 0.00 65120. Accounting 3,955.67 0.00 Total 65100 . Finance & Admin 6,664.00 0.00 65210 • Computer Equipment -Hardware 743.42 0.00 65220 • Computer Equipment - Software 4,611.82 0.00 65320 • Tech Subscriptions 20,689.38 0.00 65410 • Postage & Freight 0.00 0.00 65420 • Office Expenses 3,967.25 0.00 65430 • Office Supplies 2,505.63 0.00 65440 • Printing & Reproduction 528.65 0.00 65500 • Rent 22,501.30 0.00 65510 • Facilities Expense 0.00 0.00 65540 • Telephone & Fax 161.72 0.00 65550 • Internet 5,728.35 0.00 65915 • Licenses & Fees 1,612.40 0.00 65999 • Other G&A 7,453.55 0.00 Total 65000 - General & Admin Fees 164,040.20 0.00 Total 60000 - Operating Expenses 507,766.79 109,162.24 Total Expense 507,766.79 109,162.24 Net Ordinary Income -507.766.79 -109.162.24 Other Income/Expense Other Income Page 16 of 24 EFTA00608179 81000 . Other Income 001•GA 002•SALES 81100 . Interest Income 344.70 0.00 Total 81000 . Other Income 344.70 0.00 Total Other Income 344.70 0.00 Other Expense 82000 - Depreciation & Amortization 82100 - Depreciation Expense 429.34 0.00 Total 82000 . Depreciation & Amortization 429.34 0.00 83000. Other Expenses 83500- Taxes 83520 - State & Local Taxes 1.553.58 0.00 Total 83500. Taxes 1.553.58 0.00 Total 83000 - Other Expenses 1.553.58 0.00 Total Other Expense 1.982.92 0.00 Net Other Income -1.638.22 0.00 Net Income -509.405.01 -109.162.24 Page 17 of 24 EFTA00608180 Blue Talon Profit & Loss by Class-YTD January through May 2014 Ordinary Income:Expense Expense 60000 Operating Expenses 60100 • Advertising & Marketing 003-PARTNER SALES 004-MARKETING 60130 . Advertising 0.00 1,329.16 60160 . Other Marketing 0.00 13,125.00 60170 . Events & Sponsorship 0.00 21.351.47 Total 60100 . Advertising & Marketing 0.00 35.805.63 61000 • Compensation 61100 . Salaries 61100-1 • Salaries Reg 62.500.00 0.00 61100-3 . Officers Salaries 0.00 0.00 Total 61100 • Salaries 62.500.00 0.00 61400 . Benefits 61410 . Health Care 0.00 0.00 61440 • Other Benefits 0.00 0.00 Total 61400 • Benefits 0.00 0.00 61500 . Payroll Taxes 61510. FICANIED 4,781.30 0.00 61520 • FUTA 42.00 0.00 61530 • State 245.00 0.00 Total 61500 • Payroll Taxes 5,068.30 0.00 Total 61000 . Compensation 67.568.30 0.00 62000 • T &E 62110 . Airfare 0.00 0.00 62120 Ground Transportation 0.00 195.12 62130 . Fuel Mileage 0.00 0.00 62210 . Hotel Room Charges 0.00 2,523.00 62310 . Meals - Internal 0.00 73.57 62320 . Meals & Ent - External 0.00 88.12 62400 . Registration Fees 0.00 3,069.12 Total 62000 . T & E 0.00 5,948.93 63000 • Consulting 63100 . Consulting fees 0.00 0.00 Total 63000 . Consulting 0.00 0.00 Page 18 of 24 EFTA00608181 64000 . Recruiting & Relocation 003-PARTNER SALES 004-MARKETING 64100 • Recruiter Fees 0.00 0.00 Total 64000 • Recruiting & Relocation 0.00 0.00 65000 . General & Admin Fees 65010 • Legal Fees 65010-1 • Legal Fees- General 0.00 0.00 Total 65010 . Legal Fees 0.00 0.00 65020 • Insurance 65020.1 • General Insurance 0.00 0.00 65020-2 • Workers Compensation 0.00 0.00 Total 65020 . Insurance 0.00 0.00 65050 • Payroll Fees 0.00 0.00 65060 • Bank Fees 0.00 0.00 65100 . Finance & Admin 65110 . HR 0.00 0.00 65120 • Accounting 0.00 0.00 Total 65100 . Finance & Admin 0.00 0.00 65210 • Computer Equipment -Hardware 0.00 150.08 65220 • Computer Equipment - Software 0.00 0.00 65320 • Tech Subscriptions 0.00 0.00 65410 • Postage & Freight 0.00 295.95 65420 • Office Expenses 0.00 0.00 65430 • Office Supplies 0.00 0.00 65440 • Printing & Reproduction 0.00 1,324.21 65500 • Rent 0.00 0.00 65510 • Facilities Expense 0.00 0.00 65540 • Telephone & Fax 0.00 0.00 65550 • Internet 0.00 0.00 65915 • Licenses & Fees 0.00 0.00 65999 • Other G&A 0.00 0.00 Total 65000 • General & Admin Fees 0.00 1,770.24 Total 60000 . Operating Expenses 67.568.30 43,524.80 Total Expense 67.568.30 43.524.80 Net Ordinary Income 67.568.30 43,524.80 Other Income/Expense Other Income Page 19 of 24 EFTA00608182 81000 . Other Income 003-PARTNER SALES 004-MARKETING 81100 • Interest Income 0.00 0.00 Total 81000 • Other Income 0.00 0.00 Total Other Income 0.00 0.00 Other Expense 82000 - Depreciation & Amortization 82100 • Depreciation Expense 0.00 0.00 Total 82000 • Depreciation & Amortization 0.00 0.00 83000 . Other Expenses 83500 • Taxes 83520 . State & Local Taxes 0.00 0.00 Total 83500 . Taxes 0.00 0.00 Total 83000 • Other Expenses 0.00 0.00 Total Other Expense 0.00 0.00 Net Other Income 0.00 0.00 Net Income -67,568.30 -43,524.80 Page 20 of 24 EFTA00608183 Blue Talon Profit & Loss by Class-YTD January through May 2014 3:32 PM 06/1012014 Accrual Basis Ordinary Incometxpense Expense 60000 Operating Expenses 60100 • Advertising & Marketing 008-TECH OPS 009-RD TOTAL 60130 . Advertising 0.00 0.00 1.329.16 60160 . Other Marketing 0.00 0.00 13.125.00 60170 . Events & Sponsorship 0.00 0.00 21.351.47 Total 60100 . Advertising & Marketing 0.00 0.00 35.805.63 61000 • Compensation 61100 . Salaries 61100-1 • Salaries Reg 17.115.38 0.00 172.980.77 61100-3 . Officers Salaries 0.00 0.00 148.967.98 Total 61100 • Salaries 17.115.38 0.00 321.948.75 61400 . Benefits 61410 • Health Care 0.00 0.00 19.776.00 61440 • Other Benefits 0.00 0.00 3.25900 Total 61400 • Benefits 0.00 0.00 21034.00 61500 . Payroll Taxes 61510 • FICA/MED 1.309.33 0.00 24.62920 61520 • FUTA 42.00 0.00 483.00 61530 • State 245.00 0.00 1.70160 Total 61500 • Payroll Taxes 1.596.33 0.00 26.81980 Total 61000 . Compensation 18.711.71 0.00 371.798.55 62000 • T & E 62110 . Airfare 0.00 0.00 4.73185 62120 - Ground Transportation 0.00 0.00 1.054.11 62130 . Fuel - Mileage 0.00 0.00 11.47 62210 . Hotel Room Charges 0.00 0.00 1242.67 62310 . Meals - Internal 0.00 0.00 745.84 62320 . Meals & Ent - External 0.00 0.00 202.89 62400 . Registration Fees 0.00 0.00 1069.12 Total 62000 . T & E 0.00 0.00 11059.95 63000 • Consulting 63100 . Consulting fees 0.00 0.00 13O259.27 Total 63000 . Consulting 0.00 0.00 130.259.27 Page 21 of 24 EFTA00608184 64000 . Recruiting & Relocation 008-TECH OPS 009-RD TOTAL 64100 • Recruiter Fees 0.00 0.00 30.000.00 Total 64000 • Recruiting & Relocation 0.00 0.00 30.000.00 65000 . General & Admin Fees 65010 • Legal Fees 65010.1 • Legal Fees- General 0.00 0.00 84.890.97 Total 65010 . Legal Fees 0.00 0.00 84.890.97 65020 • Insurance 65020-1 • General Insurance 0.00 0.00 537.05 65020-2 • Workers Compensation 0.00 0.00 585.46 Total 65020 . Insurance 0.00 0.00 1.122.51 65050 • Payroll Fees 0.00 0.00 910.33 65060 • Bank Fees 0.00 0.00 -51.08 65100 • Finance & Admin 65110 . HR 0.00 0.00 2.708.33 65120 • Accounting 0.00 0.00 3.95367 Total 65100 . Finance & Admin 0.00 0.00 6.664.00 65210 . Computer Equipment -Hardware 0.00 123.48 1.016.98 65220 • Computer Equipment - Software 1.470.00 509.86 6.591.68 65320 • Tech Subscriptions 0.00 0.00 20.689.38 65410 • Postage & Freight 0.00 0.00 295.95 65420 • Office Expenses 528.19 58.75 4.554.19 65430 • Office Supplies 0.00 0.00 2.50363 65440 • Printing & Reproduction 0.00 0.00 1.852.86 65500 • Rent 0.00 0.00 22.501.30 65510 • Facilities Expense 28.69 0.00 28.69 65540 • Telephone & Fax 0.00 109.08 270.80 65550 • Internet 0.00 0.00 5.728.35 65915 • Licenses & Fees 0.00 0.00 1.612.40 65999 • Other G&A 0.00 0.00 7.453.55 Total 65000 • General & Admin Fees 2.026.88 801.17 168.63849 Total 60000 . Operating Expenses 20.73839 801.17 749.561.89 Total Expense 20.738.59 801.17 749.561.89 Net Ordinary Income -20.738.59 -801.17 -749.561.89 Other Income/Expense Other Income Page 22 of 24 EFTA00608185 81000 . Other Income 008-TECH OPS 009-RD TOTAL 81100 • Interest Income 0.00 0.00 344.70 Total 81000 • Other Income 0.00 0.00 344.70 Total Other Income 0.00 0.00 344.70 Other Expense 82000 - Depreciation & Amortization 82100 . Depreciation Expense 0.00 0.00 429.34 Total 82000 • Depreciation & Amortization 0.00 0.00 429.34 83000 . Other Expenses 83500 • Taxes 83520 . State & Local Taxes 0.00 0.00 1.553.58 Total 83500 . Taxes 0.00 0.00 1.553.58 Total 83000 . Other Expenses 0.00 0.00 1.553.58 Total Other Expense 0.00 0.00 1.982.92 Net Other Income 0.00 0.00 1.638.22 Net Income -20.738.59 -801.17 -751.200.11 Page 23 of 24 EFTA00608186 Blue Talon Statement of Cash Flows-YTD January through May 2014 OPERATING ACTIVITIES Net Income Adjustments to reconcile Net Income to net cash provided by operations: 13000 Prepaid Expenses 20000 Accounts Payable 22500 . Credit Cards:Pratik Credit Card - 8460 23005 Expensify Clearing 2301O Accrued Expenses Net cash provided by Operating Activities INVESTING ACTIVITIES 15000 - Fixed Assets:15100 Furniture and Fixtures 15000 - Fixed Assets:15199 Furniture and Fixtures - AD 15000 - Fixed Assets:15300 Computer Equipment 15000 - Fixed Assets:15399 • Computer Equipment- AD Net cash provided by Investing Activities 3:31 PM 06/1012014 Jan - May 14 751.200.11 -5.329.30 44.612.00 6.361.17 1143.30 1149.00 -702.263.94 -3.417.80 170.88 -7.815.12 258.46 -10.803.58 FINANCING ACTIVITIES 30000 - Capital Stock:30100 • Capital Contributed:30100.2 Legal Fees-Financing -49.653.36 Net cash provided by Financing Activities -49.653.36 Net cash increase for period -762.720.88 Cash at beginning of period Cash at end of period 1.260.383.45 497.662.57 Page 24 of 24 EFTA00608187