0001445866-16-003010.txt : 20161221 0001445866-16-003010.hdr.sgml : 20161221 20161221115433 ACCESSION NUMBER: 0001445866-16-003010 CONFORMED SUBMISSION TYPE: 8-K/A PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20161219 ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20161221 DATE AS OF CHANGE: 20161221 FILER: COMPANY DATA: COMPANY CONFORMED NAME: BOSTON OMAHA Corp CENTRAL INDEX KEY: 0001494582 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE OPERATORS (NO DEVELOPERS) & LESSORS [6510] IRS NUMBER: 270788438 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-55714 FILM NUMBER: 162063250 BUSINESS ADDRESS: STREET 1: 292 NEWBURY STREET, SUITE 333 CITY: BOSTON STATE: MA ZIP: 02115 BUSINESS PHONE: 857-256-0079 MAIL ADDRESS: STREET 1: 292 NEWBURY STREET, SUITE 333 CITY: BOSTON STATE: MA ZIP: 02115 FORMER COMPANY: FORMER CONFORMED NAME: REO PLUS, INC. DATE OF NAME CHANGE: 20100618 8-K/A 1 boston8ka12192016.htm 8-K/A

 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549

FORM 8-K/A

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


Date of Report (Date of earliest event reported):  December 21, 2016
 
BOSTON OMAHA CORPORATION
(Exact name of registrant as specified in its Charter)
 
Delaware
333-170054
27-0788438
(State or other jurisdiction of Incorporation)
(Commission File Number)
(IRS Employer Identification Number)
 
 
(Address and telephone number of principal executive offices, including zip code)
 
c/o Boulderado Group, LLC
292 Newbury Street, Suite 333
Boston, Massachusetts  02115
(857) 256-0079
___________________________________
(Former name or address, if changed since last report)
Not Applicable
 
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of Registrant under any of the following provisions (see General Instruction A.2. below):

[ ]           Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ]           Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ]           Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act   (17 CFR 240.14d-2(b))

[ ]           Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))




EXPLANATORY NOTE
 
Boston Omaha Corporation (the "Company") is filing this Current Report on Form 8-K/A (Amendment No. 1) (the "8-K/A") in order to amend its previously filed Current Report on Form 8-K, as filed with the Securities and Exchange Commission on February 23, 2016 (the "Initial 8-K"), in order to file certain financial statements and to furnish certain pro forma financial information pursuant to Item 9.01 of this Form 8-K/A.

The Initial 8-K provided disclosure under Item 2.01 thereof regarding the February 16, 2016 closing of the Company's acquisition of certain billboards and related assets on February 16, 2016.  On that date, Link Media Wisconsin, LLC, which is owned by Link Holdings, LLC, our subsidiary, entered into an Asset Purchase Agreement with Jag, Inc. and the sole voting shareholder of Jag, Inc., by which Link Media Wisconsin, LLC acquired 422 billboards, certain directional signs and other related assets from Jag, Inc.  The billboards, directional signs and related assets are located in Wisconsin.  The purchase price for the acquired assets was $6,954,246, of which $687,500 was placed in escrow and the remainder was paid at closing. The purchase price is subject to certain post-closing working capital adjustments.

Item 9.01 of Form 8-K provides that with respect to transactions described pursuant to Item 2.01 of Form 8-K, the financial statements of businesses acquired may be filed, and pro forma financial information regarding such transactions may be furnished, not later than 71 calendar days after the date that the initial report on Form 8-K must be filed. As such, the Company disclosed in the Initial 8-K that it would file the required financial statements and furnish the required pro forma financial information within that time frame. The preparation of such financial statements and pro forma financial information took longer than the Company anticipated, due principally to delays in obtaining necessary information and supporting documents from the seller.   

The Company is now providing audited financial statements for Jag, Inc. for the year ended December 31, 2015, as well as the unaudited proforma combined balance sheet and unaudited pro forma combined statement of operations for Boston Omaha Corporation and Jag, Inc. for the year ending December 31, 2015.

 
SECTION 9 - FINANCIAL STATEMENTS AND EXHIBITS
 
Item 9.01        Financial Statements and Exhibits.

(a)     Financial statements of businesses acquiredThe audited financial statements of Jag, Inc. for the year ended December 31, 2015, are filed herewith as Exhibit 99.1.

(b)     Pro forma financial informationThe unaudited pro forma combined balance sheet and unaudited pro forma combined statement of operations for Boston Omaha Corporation and Jag, Inc. for the year ended December 31 2015, are filed herewith as Exhibit 99.2.

(c)     Shell Company Transaction.
Not applicable.

(d)     Exhibits.
Not Applicable

 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
 
BOSTON OMAHA CORPORATION
 
       
Date:  December 21, 2016
 
 /s/Alex B. Rozek 
 
 
Name:
Alex B. Rozek
 
 
Title:
President and Treasurer (Principal Executive Officer)
 
 
 
 
 
 
 
 
 
 
 
 /s/Joshua Weisenburger
 
 
Name:
Joshua Weisenburger
 
 
Controller (Principal Accounting Officer)
 
 
 
 
 
 
 
 
 
 


EX-99.1 2 ex991.htm EXHIBIT 99.1
Exhibit 99.1



JAG, INC.
(A Wisconsin Corporation)

FINANCIAL STATEMENTS

FOR THE YEAR ENDED DECEMBER 31, 2015


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Board of Directors and Stockholders of
Jag, Inc.
Algoma, Wisconsin

We have audited the accompanying balance sheet of Jag, Inc. (the "Company") as of December 31, 2015, and the related statements of operations and stockholders' deficit, and cash flows for the year then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform an audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Jag, Inc. as of December 31, 2015 and the results of its operations and its cash flows for the year then ended, in conformity with accounting principles generally accepted in the United States of America.

/s/ MaloneBailey, LLP
www.malonebailey.com
Houston, Texas
December 19, 2016


 
JAG, INC.
(a Wisconsin Corporation)
 
 
Balance Sheet  
 
       
December 31, 2015  
 
       
ASSETS  
 
       
Current Assets:
     
  Cash
 
$
40,876
 
  Accounts receivable, net
   
86,450
 
  Prepaid expense
   
43,673
 
         
   Total Current Assets
   
170,999
 
         
Property and Equipment:
       
  Structures and displays
   
1,270,912
 
  Land,building and improvements
   
14,950
 
  Vehicles and equipment
   
539,741
 
  Accumulated depreciation
   
(1,625,747
)
         
   Total Property and Equipment, net
   
199,856
 
         
         
   Total Assets
 
$
370,855
 
         
LIABILITIES AND STOCKHOLDERS' DEFICIT  
   
         
Current Liabilities:
       
  Accounts payable and accrued expenses
 
$
42,692
 
  Deferred compensation payable
   
317,756
 
  Deferred revenue
   
50,433
 
  Note payable, related party
   
70,000
 
  Current portion of long-term debt, including related party debt of $24,200
   
94,650
 
         
   Total Current Liabilities
   
575,531
 
         
Long-term debt, including related party debt of $78,602
   
285,627
 
         
   Total Liabilities
   
861,158
 
         
Stockholders' Deficit:
       
  Common stock, no par value, 17,000 shares authorized, 6,220 shares issued and outstanding
   
18,056
 
  Treasury stock
   
(232,412
)
  Accumulated deficit
   
(275,947
)
         
   Total Stockholders' Deficit
   
(490,303
)
         
   Total Liabilities and Stockholders' Deficit
 
$
370,855
 
         
The accompanying notes are an integral part of the financial statements.

2

 
JAG, INC.
(a Wisconsin Corporation)
 
 
Statement of Operations  
 
       
For the Year Ended December 31, 2015 
       
Revenues:
     
  Billboard rentals
 
$
1,518,693
 
  Service income
   
152,995
 
         
   Total Revenues
   
1,671,688
 
         
Costs and Expenses:
       
  Cost of revenues (exclusive of depreciation)
   
617,252
 
  Salaries, taxes, and benefits
   
731,276
 
  General and administrative
   
195,575
 
  Rent, related party
   
66,000
 
  Depreciation
   
64,098
 
  Bad debt expense
   
1,588
 
         
Total Costs and Expenses
   
1,675,789
 
         
Net Loss from Operations
   
(4,101
)
         
Other Income (Expense):
       
  Interest income
   
586
 
  Interest expense
   
(16,751
)
         
Net Loss
 
$
(20,266
)
 
The accompanying notes are an integral part of the financial statements.

3

 
JAG, INC.
(a Wisconsin Corporation)

Statement of Changes in Stockholders' Deficit            
 
                                     
   
No. of shares
                         
   
Common
Stock
   
Treasury
Stock
   
Common
Stock
   
Treasury
Stock
   
Accumulated
Deficit
   
Total
 
                                     
Balance,
                                   
January 1, 2015
   
6,220
     
3,880
   
$
18,056
   
$
(232,412
)
 
$
(247,594
)
 
$
(461,950
)
                                                 
Net loss
   
-
     
-
     
-
     
-
     
(20,266
)
   
(20,266
)
Dividends paid
   
-
     
-
     
-
     
-
     
(8,087
)
   
(8,087
)
                                                 
Balance,
                                               
December 31, 2015
   
6,220
     
3,880
   
$
18,056
   
$
(232,412
)
 
$
(275,947
)
 
$
(490,303
)
                                                 
The accompanying notes are an integral part of the financial statements.
4

 
JAG, INC.
(a Wisconsin Corporation)

Statement of Cash Flows  
 
       
For the Year Ended December 31, 2015  
 
       
Cash Flows from Operating Activities:
     
Net Loss
 
$
(20,266
)
  Adjustments to reconcile net loss to cash used in operating activities:
       
    Depreciation
   
64,098
 
    Bad debts
   
1,588
 
  Changes in operating assets and liabilities:
       
    Accounts receivable
   
(35,314
)
    Prepaid expense
   
(10,274
)
    Accounts payable and accrued expenses
   
(60,979
)
    Deferred compensation payable
   
41,571
 
    Deferred revenue
   
(3,902
)
         
Net Cash Used in Operating Activities
   
(23,478
)
         
Cash Flows From Investing Activities:
       
  Purchases of structures and displays
   
(45,211
)
  Leasehold improvements
   
(999
)
Purchases of vehicles and equipment
   
(2,266
)
         
Net Cash Used in Investing Activities
   
(48,476
)
         
Cash Flows from Financing Activities:
       
  Proceeds from notes payable
   
318,180
 
  Payments on notes payable
   
(274,695
)
  Payments on note payable, related party
   
(23,340
)
  Dividends paid
   
(8,087
)
         
Net Cash Provided in Financing Activities
   
12,058
 
         
Net Decrease in Cash
   
(59,896
)
         
Cash, Beginning of Year
   
100,772
 
         
Cash, End of Year
 
$
40,876
 
         
Interest Paid in Cash
 
$
16,751
 
         
Income Taxes Paid in Cash
 
$
-
 
         
The accompanying notes are an integral part of the financial statements.
5

 
JAG, INC.
(a Wisconsin Corporation)
Notes to Financial Statements
For the Year Ended December 31, 2015
 
 
NOTE 1.  ORGANIZATION AND BACKGROUND

The accompanying financial statements have been prepared in connection with Jag, Inc.'s sale of outdoor advertising assets to Link Media Wisconsin ("LMW"), a wholly-owned subsidiary of Boston Omaha Corporation, and to comply with the rules and regulations of the Securities and Exchange Commission ("SEC") for inclusion by Boston Omaha Corporation in its current report on Form 8-K/A.

Jag, Inc. was organized on June 12, 1959.  The Company's operations include the ownership and leasing of billboards and directional signs in multiple counties in Wisconsin.


NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Concentrations

All of the Company's operations are located in Wisconsin.

For the year ended December 31, 2015, 57% of the Company's loans were from one bank.

Cash and Cash Equivalents

For purposes of the statement of cash flows, the Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.

Accounts Receivable

Accounts receivable are recorded at the invoiced amount, net of advertising agency commissions, sales discounts, and allowances for doubtful accounts.  The Company evaluates the collectability of its accounts receivable based on its knowledge of its customers and historical experience of bad debts.  In circumstances where the Company is aware of a specific customer's inability to meet its financial obligations, it records a specific allowance to reduce the amounts recorded to what it believes will be collected.  For all other customers, the Company recognizes reserves for bad debt based upon historical experience of bad debts as a percentage of revenue, adjusted for relative improvement or deterioration in its agings and changes in current economic conditions.  As of December 31, 2015, the allowance for doubtful accounts was zero.

Property and Equipment

Property and equipment are carried at cost.  Depreciation and amortization are provided principally on the straight-line method over the estimated useful lives of the assets, which range from five to fifteen years as follows:
 
Building and leasehold improvements
7 to 15 years
Billboard structures and displays
5 to 15 years
Equipment
5 to 7 years
Vehicles
5 years

Maintenance and repair costs are charged against income as incurred.  Significant improvements or betterments are capitalized and depreciated over the estimated life of the asset.

6

JAG, INC.
(a Wisconsin Corporation)
Notes to Financial Statements
For the Year Ended December 31, 2015
 

NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

Land Leases

Most of the advertising structures are located on leased land.  Land leases related to the structures are typically paid in advance for periods ranging from one to twelve months.  The lease contracts include those with fixed payments and those with escalating payments.  Some of the lease contracts contain a base rent payment plus an additional amount up to a particular percentage of net revenue.  In months in which the net revenue does not support a percentage payment, a stated minimum monthly payment is required.  Prepaid land leases are recorded as assets and expensed ratably over the related term and rent payments in arrears are recorded as an accrued liability.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

The more significant areas requiring the use of management estimates relate to useful lives for depreciation.  Accordingly, actual results could differ from those estimates.

Revenue Recognition

The Company generates revenue from outdoor advertising through the leasing of billboards and directional signs.  The terms of the operating leases range from less than one month to one year and are generally billed monthly.  Revenue for advertising space rental is recognized ratably over the term of the contract.  Advertising revenue is reported net of agency commissions.  Agency commissions are calculated based on a stated percentage applied to gross billing revenue for operations.  Payments received in advance of being earned are recorded as deferred income.

There were no advertising agency commissions for the year ended December 31, 2015.

Income Taxes

The Company elected Subchapter S status on July 7, 1959.  Taxable income or losses of the Company are passed through to the Company's stockholders, in accordance with each stockholder's percentage of ownership, for inclusion in each individual stockholder's income tax return.

The Company has no tax positions at December 31, 2015 for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility. Tax years 2013 through 2015 are open to examination by the Internal Revenue Service.

7

JAG, INC.
(a Wisconsin Corporation)
Notes to Financial Statements
For the Year Ended December 31, 2015
 

NOTE 3.  NOTE PAYABLE, RELATED PARTY

As of December 31, 2015, note payable, related party consists of a note in the principal amount of $70,000 payable to an entity related to the controlling stockholder.  The note is non-interest bearing, unsecured, and due on demand.

NOTE 4.  LONG-TERM DEBT

For the year ended December 31, 2015, long-term debt consists of the following:
     
       
Installment note payable, due in monthly installments
     
  of $565 including interest, due January, 2016;
     
  secured by a vehicle with a carrying value of  $607.
 
$
348
 
         
Installment note payable to a bank, due in monthly
       
  installments of $530, bearing interest at 4.40% per annum,
       
  due November, 2017; secured by a vehicle with a carrying
       
  value of $11,385.
   
11,677
 
         
Installment note payable to a bank, due in monthly
       
  installments of $262, bearing interest at 6.74% per annum,
       
  due during 2018; secured by a vehicle with a carrying value
       
  of $10,231.
   
8,193
 
         
Note payable to a former stockholder, due in monthly
       
  installments of $2,263, bearing interest at 3.25% per annum,
       
  due December, 2019; unsecured.
   
102,802
 
         
Line of credit payable to a bank, bearing interest
       
  at 4.99% per annum and secured by all of Company's assets,
       
  assignment of rents from the sign locations,
       
  and guaranteed by an  entiity related to the Company.
   
24,969
 
         
Installment note payable to a bank, due in monthly
       
  installments of $6,000, bearing interest at 4.99% per annum,
       
  due July, 2019; secured by all of the Company's assets,
       
  assignment of rents from the sign locations,
       
  and guaranteed by an  entiity related to the Company.
   
232,288
 
         
     
380,277
 
         
Less current portion
   
(94,650
)
         
Total
 
$
285,627
 
 
 
8

JAG, INC.
(a Wisconsin Corporation)
Notes to Financial Statements
For the Year Ended December 31, 2015
 

NOTE 4.  LONG-TERM DEBT (Continued)

Maturities of long-term debt are as follows:
     
       
2016
 
$
94,650
 
2017
   
123,550
 
2018
   
96,677
 
2019
   
65,400
 
         
   
$
380,277
 
 
NOTE 5. COMMON STOCK

The Company is authorized to issue 17,000 shares of common stock, of which 2,000 shares are voting shares.  As of December 31, 2015, 6,220 shares of the Company's common stock were issued and outstanding.

NOTE 6.  FUTURE MINIMUM LEASE PAYMENTS

The Company has leases for three hundred, twenty billboard locations.  The leases are non-cancelable operating leases having remaining terms ranging from month-to-month to two hundred ninety-six months.  Ground rents for the year ended December 31, 2015 were $326,172.  No contingent rents were included in ground rents for the year ended December 31, 2015.

Future minimum rents are as follows:
 
2016
 
$
319,215
 
2017
   
205,229
 
2018
   
172,277
 
2019
   
148,359
 
2020
   
129,693
 
Thereafter
   
504,942
 
         
   
$
1,479,715
 
 
NOTE 7.  FAIR VALUE

The Company's financial instruments consist of cash, trade receivables and payables, a note payable and long-term debt, including the current portion.  The carrying values of cash, trade receivables and payables, and the short-term note approximate their fair values.

The carrying value of notes payable approximates their fair values based on the current rates offered by financial institutions for notes of the same remaining maturity.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between independent and knowledgeable parties who are willing and able to transact for an asset or liability at the measurement date.
9

JAG, INC.
(a Wisconsin Corporation)
Notes to Financial Statements
For the Year Ended December 31, 2015
 

NOTE 8.  RELATED PARTIES

At December 31, 2015, the Company was indebted on notes payable in the aggregate amount of $172,802, to entities related to the controlling stockholder.  During 2015 $23,340 in principal and $3,816 in interest was paid to the related parties.  (See Notes 3 and 4.)

As of December 31, 2015, the Company paid $8,067 in dividends.

Additionally, the Company leases office space for $5,500 per month, from an entity related to its controlling stockholder.  Rent paid by the Company was $66,000 for the year ended December 31, 2015.

NOTE 9.  LIQUIDITY

As of December 31, 2015, the Company has an accumulated deficit of approximately $276,000.  The controlling stockholder has advanced funds to the Company in the form of deferred compensation in the cumulative amount of $317,756 to fund operations.  The controlling stockholder has the ability and intent to fund the Company's operations and debt service, as needed.  Additionally, management believes that billboard revenues will increase in the coming year.

On February 16, 2016, the Company sold substantially all of its assets for a gross sales price of $6,954,246. (See Note 11.)

NOTE 10.  CONTINGENCIES

The Company is a guarantor on three notes payable by entities related to the controlling stockholder of the Company.  All of the notes are payable to one bank.  The debts were incurred between September, 2014 and June, 2015.  The original amount of the debts was $556,590.  The notes mature between December, 2016 and June, 2020.  The notes are secured by all of the Company's assets, including the contract rights of payments from the sign locations.  The notes are not recorded on the Company's books and were not in default as of December 31, 2015.  The notes were paid in full on February 17, 2016.

NOTE 11.  SUBSEQUENT EVENTS

On February 16, 2016, the Company sold 422 billboard displays, directional signs, equipment, and related assets to Link Media Wisconsin ("LMW") for a gross sales price of $6,954,246 of which $687,500 was escrowed.  The sales price is subject to certain post-closing adjustments.

On February 16, 2016 LMW executed a twelve month lease agreement for office space from the entity related to the seller. (See Note 8.)

On February 17, 2016, the Company's notes payable to a financial institution, whose principal amounts totaled $265,632, were paid in full.  On the same date, notes totaling $515,002 on which the Company was a guarantor, were also paid in full.
10

EX-99.2 3 ex992.htm EXHIBIT 99.2
Exhibit 99.2
 
 

 
BOSTON OMAHA CORPORATION
AND
JAG, INC

UNAUDITED PROFORMA COMBINED BALANCE SHEET
AND
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS

DECEMBER 31, 2015

 
BOSTON OMAHA CORPORATION
AND JAG, INC.
 
 
UNAUDITED PRO FORMA COMBINED BALANCE SHEET        
 
                         
DECEMBER 31, 2015           
 
                         
ASSETS     
 
                         
         
Pro Forma
         
Pro Forma
 
   
Boston Omaha
   
Adjustments
   
Notes
   
Combined
 
                         
Current Assets:
                       
  Cash
 
$
13,189,066
   
$
(6,954,246
)
   
(2
)
 
$
6,234,820
 
  Accounts receivable, net
   
276,750
     
106,340
     
(2
)
   
383,090
 
  Prepaid expense
   
70,484
     
-
             
70,484
 
                                 
   Total Current Assets
   
13,536,300
     
(6,847,906
)
           
6,688,394
 
                                 
Property and Equipment:
                               
  Structures and displays
   
4,548,473
     
3,252,940
     
(2
)
   
7,801,413
 
  Office equipment
   
2,633
     
-
             
2,633
 
  Vehicles and equipment
   
-
     
79,737
     
(2
)
   
79,737
 
  Accumulated depreciation
   
(307,367
)
   
-
             
(307,367
)
                                 
   Total Property and Equipment, net
   
4,243,739
     
3,332,677
             
7,576,416
 
                                 
Other Assets:
                               
  Goodwill
   
4,389,664
     
2,072,038
     
(2
)
   
6,461,702
 
  Intangible assets, net
   
958,265
     
1,443,191
     
(2
)
   
2,401,456
 
  Investment in unconsolidated affiliate
   
657,528
     
-
             
657,528
 
                                 
   Total Other Assets
   
6,005,457
     
3,515,229
             
9,520,686
 
                                 
   Total Assets
 
$
23,785,496
   
$
-
           
$
23,785,496
 
                                 
LIABILITIES AND STOCKHOLDERS' EQUITY            
 
                                 
Current Liabilities:
                               
  Accounts payable and accrued expenses
 
$
152,672
     
-
           
$
152,672
 
  Accounts payable, stockholder
   
2,721
     
-
             
2,721
 
  Notes payable, stockholders
   
100,000
     
-
             
100,000
 
  Accrued interest, stockholders
   
4,384
     
-
             
4,384
 
  Deferred revenue
   
30,204
     
-
             
30,204
 
                                 
   Total Current Liabilities
   
289,981
     
-
             
289,981
 
                                 
Stockholders' Equity:
                               
  Preferred stock, $.001 par value, 1,300,000 shares authorized, 0 shares issued and outstanding
   
-
     
-
             
-
 
  Common stock, $.001 par value, 28,700,000 shares authorized, 1,716,954 shares issued and outstanding
   
1,717
     
-
             
1,717
 
  Class A common stock, $.001 par value, 1,300,000 shares authorized, 1,055,560 issued and outstanding
   
1,056
     
-
             
1,056
 
  Additonal paid-in capital
   
25,062,544
     
-
             
25,062,544
 
  Accumulated deficit
   
(1,569,802
)
   
-
             
(1,569,802
)
                                 
   Total Stockholders' Equity
   
23,495,515
     
-
             
23,495,515
 
                                 
   Total Liabilities and Stockholders' Equity
 
$
23,785,496
   
$
-
           
$
23,785,496
 
 
See accompanying notes to unaudited pro forma combined financial statements.

 
BOSTON OMAHA CORPORATION
AND JAG, INC.
 
 
UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS   
 
                         
FOR THE YEAR ENDED DECEMBER 31, 2015         
 
                         
                         
         
Pro Forma
         
Pro Forma
 
   
Boston Omaha
   
Adjustments
   
Notes
   
Combined
 
Revenues:
                       
  Billboard rentals
 
$
713,212
   
$
1,518,693
     
(2
)
 
$
2,231,905
 
  Service income
   
-
     
152,995
     
(2
)
   
152,995
 
  Consulting fees, related party
   
9,700
     
-
             
9,700
 
                                 
   Total Revenues
   
722,912
     
1,671,688
             
2,394,600
 
                                 
Costs and Expenses:
                               
  Cost of revenues (exclusive of depreciation and amortization)
   
229,507
     
617,252
     
(2
)
   
846,759
 
  Professional fees
   
737,451
     
-
             
737,451
 
  Depreciation
   
307,367
     
234,821
     
(2
)
   
542,188
 
  Leased employees
   
241,803
     
-
             
241,803
 
  Salaries, taxes and benefits
   
-
     
731,276
     
(2
)
   
731,276
 
  General and administrative
   
153,715
     
195,575
     
(2
)
   
349,290
 
  Amortization
   
150,436
     
298,759
     
(2
)
   
449,195
 
  Rent, related party
   
-
     
66,000
     
(2
)
   
66,000
 
  Bad debt expense
   
9,511
     
1,588
     
(2
)
   
11,099
 
                                 
   Total Costs and Expenses
   
1,829,790
     
2,145,271
             
3,975,061
 
                                 
Net (Loss) Income from Operations
   
(1,106,878
)
   
(473,583
)
           
(1,580,461
)
                                 
Other Income (Expense):
                               
  Interest income
   
-
     
586
     
(2
)
   
586
 
  Equity in income (loss) of unconsolidated affiliate
   
3,813
     
-
             
3,813
 
  Gain on sale of investment in unconsolidated affiliate
   
78,150
     
-
             
78,150
 
  Interest expense
   
(22,508
)
   
(16,751
)
   
(2
)
   
(39,259
)
                                 
(Loss) Income Before Income Tax
   
(1,047,423
)
   
(489,748
)
           
(1,537,171
)
                                 
Income Tax (Provision) Benefit
   
-
     
205,221
     
(3b
)
   
205,221
 
                                 
Net (Loss) Income
 
$
(1,047,423
)
 
$
(284,527
)
         
$
(1,331,960
)
                                 
Basic and Diluted Net (Loss) Income per share
 
$
(0.71
)
           
(3a
)
 
$
(0.90
)
                                 
Basic and Diluted Weighted Average
                               
Shares Outstanding
   
1,481,310
             
(3a
)
   
1,481,310
 
 
See accompanying notes to unaudited pro forma combined financial statements.

 
BOSTON OMAHA CORPORATION
AND JAG, INC.

NOTES TO UNAUDITED COMBINED PRO FORMA INFORMATION
 
 
NOTE 1.  BASIS OF PRESENTATION

The unaudited pro forma combined balance sheet has been prepared by applying pro forma adjustments to Boston Omaha Corporation's ("Boston Omaha") ("the Company") audited balance sheet as of December 31, 2015.

The unaudited pro forma combined statement of operations for the year ended December 31, 2015 has been prepared from Boston Omaha's audited statement of operations for the year ended December 31, 2015 and from Jag, Inc.'s  ("Jag") audited statement of operations for the year ended December 31, 2015.

The unaudited pro forma financial statements should be read in conjunction with the historical financial statements of Boston Omaha and Jag as follows:

Boston Omaha's audited financial statements for the years ended December 31, 2015 and 2014 and the notes relating thereto, as found in its Form 10-K which was filed on March 30, 2016.

Jag's audited financial statements for the year ended December 31, 2015 and the notes relating thereto included elsewhere in this Form 8-K/A.

NOTE 2. PURCHASE OF ASSETS

On February 16, 2016, Link Media Wisconsin, LLC ("LMW") a wholly-owned subsidiary of Boston Omaha purchased 422 billboard displays, directional signs, equipment and related assets from a private seller, Jag, for a purchase price of $6,954,246.  The purchase price is subject to certain post-closing adjustments.  The provisional allocation of the purchase price is as follows:
 
Recognized Amount of Identifiable Assets Acquired and Liabilities Assumed
     
       
Property and Equipment:
     
Structures and displays
 
$
3,252,940
 
Vehicles, tools, and equipment
   
79,737
 
         
Total Property and Equipment
   
3,332,677
 
         
Intangible Assets:
       
Customer relationships
   
694,400
 
Permits and lease acquisition costs
   
589,491
 
Noncompetition agreement
   
104,300
 
Easement
   
55,000
 
Goodwill
   
2,072,038
 
         
Total Intangible Assets
   
3,515,229
 
         
Accounts receivable
   
106,340
 
         
Total Identifiable Assets Acquired
   
6,954,246
 
         
Liabilities assumed
   
-
 
         
Total Identifiable Net Assets
 
$
6,954,246
 
         
 

 
BOSTON OMAHA CORPORATION
AND JAG, INC.

NOTES TO UNAUDITED COMBINED PRO FORMA INFORMATION
 
 
NOTE 2. PURCHASE OF ASSETS (Continued)

The allocation of the purchase price is based on internal information and will be revised when the independent appraisal has been completed.

Depreciation has been provided for structures and displays on a straight-line basis for their estimated useful lives, expected to range from ten to fifteen years.  Amortization has been provided for the intangible assets having finite lives expected to be three to fifty years.

NOTE 3. PRO FORMA ADJUSTMENTS

Earnings per share

The basic net income (loss) per common share is computed by dividing the net income (loss) by the weighted average number of common shares outstanding.

Income Tax (Provision) Benefit

Federal and state income taxes have been provided at statutory rates.