EX-99 2 avalondigitalexh991504.txt Exhibit 99.1 ------------ AVALON DIGITAL MARKETING SYSTEMS Balance Sheet As of May 31, 2004 ASSETS Current Assets: Cash (from Form 2-B, line 5) $ 71,763 Accounts Receivable (from Form 2-E) 19,279 Receivable from Officers, Employees, Affiliates - Inventory - Other Current Assets: Contract, AR 38,551 Retainage - Prepaid and Other 11,896 ------------ Total Current Assets $ 141,489 ------------ Fixed Assets: Land - Building - Equipment, Furniture and Fixtures 1,218,937 ------------ Total Fixed Assets 1,218,937 ------------ Less: Accumulated Depreciation (902,172) Net Fixed Assets 316,765 ------------ Other Long Term Assets: License 10,000 ------------ TOTAL ASSETS 468,254 ------------ LIABILITIES Post Petition Liabilities: Accounts Payable (from Form 2-E) 273,240 Notes Payable - Rents and Leases Payable 6,700 Taxes Payable (from Form 2-E) 22,329 Accrued interest 2,948 Other: Accrued Expense 337,944 ------------ Total Post Petition Liabilities $ 643,161 ------------ Pre-Petition Liabilities: Priority Claims 160,989 Secured Debt 227,816 Unsecured Debt 9,048,586 ------------ Total Pre-Petition Liabilities 9,437,391 ------------ TOTAL LIABILITIES $ 10,080,552 ------------ OWNERS' EQUITY Capital Stock or Owner's Investment $ 8,714 Paid-In Capital 28,051,203 Retained Earnings: Pre Petition (36,880,111) Post Petition (792,104) ------------ TOTAL OWNERS' EQUITY $ (9,612,298) ------------ TOTAL LIABILITIES AND OWNERS' EQUITY $ 468,254 ------------ 1 AVALON DIGITAL MARKETING SYSTEMS Profit and Loss Statement For Period May 1 to May 31, 2004 Gross Operating Revenue $ 144,215 Less: Discounts, Returns and Allowances - ------------ Net Operating Revenue $ 144,215 Cost of Goods Sold 6,053 ------------ Gross Profit 138,162 ------------ Operating Expenses Salaries and Wages 90,898 Rents and Leases 6,843 Payroll Taxes (Employer) 6,805 Other: Health Insurance 8,910 Fees/Licenses - G & A 14,007 ------------ Total Operating Expenses 127,463 Operating Income (Loss) 10,699 ------------ Legal and Professional Fees 406 Depreciation, Depletion and Amortization 27,358 Interest Expense 1,000 ------------ Net Operating Income (Loss) (18,065) ------------ Non-Operating Income and Expenses Other Non-Operating (Expenses) (3,411) Gains (Losses) on Sale of Assets - Interest Income - Other Non-Operating Income - ------------ Net Non-Operating Income or (Expenses) (3,411) ------------ Net Income (Loss) Before Income Taxes (21,476) ------------ Federal and State Income Tax Expense (Benefit) - ------------ NET INCOME (LOSS) $ (21,476) ------------ 2