NOTE 13. ACQUISITIONS

9 Months Ended

Sep. 30, 2019

Notes to Financial Statements

NOTE 13. ACQUISITIONS

NOTE 13. ACQUISITIONS

Description of the Transactions

Service 800, Inc.

On March 4, 2019 Jean Mork Bredeson, Founder and President of Service 800, Inc., received $1,890,000 in cash, a short term cash hold back of $210,000 and $2,100,000 in a three year 5.5% promissory note. The $2,100,000 promissory note is personally guaranteed by Geordan Pursglove Beyond Commerce’s President, CEO. On July 18, 2018 Jean Mork Bredeson received 2,000,000 shares of Beyond Commerce’s restricted common stock, and directed the issuance of 3,000,000 additional shares to three other individuals as part of the business combination as follows: On July 18, 2018 Allen Bredeson, Vice President of Marketing and Client Relations, received 1,000,000 shares of Beyond Commerce’s restricted common stock. Derick White, Vice President of Sales received 1,000,000 shares of Beyond Commerce’s restricted common stock, and Jeff Schwendinger, Vice President of Operations received 1,000,000 shares of Beyond Commerce’s restricted common stock. The effective date of this business combination between Beyond Commerce and Service 800, is February 28, 2019, when Beyond Commerce received 100% of Service 800 stock, assets consisting of the company’s website, customer lists, current customer base, and customer’s in the company’s pipeline and proprietary software. 

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed based on internal company evaluations at the date of acquisition:

Assets Acquired:
Prepaid expenses	$	28,316
Property, plant and equipment		1,067,989
Intangible asset – customer list		4,053,892
Assets acquired	$	5,150,197
Liabilities Assumed:
Accounts payable	$	121,958
Outstanding checks		63,084
Other current liabilities		293,145
Liabilities assumed	$	478,187
Net assets acquired	$	4,672,010
Fair value of consideration given	$	4,672,010

PathUX, LLC

On May 31, 2019, Robert Bisson, Christian Schine, and Ryan Rich, the three members of PathUX, LLC, received an aggregate of 70,000,000 shares of Beyond Commerce’s restricted common stock, valued at $427,000. The $427,000 is reflected as deposit on the acquisition of PathUX to be held in escrow pending the following alternatives, which would encompass the return of these shares:

i. Ninety (90) days after closing, Beyond Commerce, Inc. at the discretion of the former PathUX LLC members shall owe $1,000,000 to the three former members. The payment due date may be extended at the discretion of the Company for an additional ninety (90) days, for a total of one hundred eighty (180) days, through incremental cash payment aggregating $300,000 of additional monetary compensation.

ii. Company will also during this time period, and once again at the discretion of the former members, issue a $2,000,000 convertible promissory note, which carries a two year quarterly amortizing payment requirement of $317,068.40 starting on December 30, 2019, and an 8.0% interest rate. This note is fully amortized on June 30, 2021.

These contingent liabilities are presented on the Company’s financials as follow:

Short-term contingent acquisition liability	$ 1,951,205
Long-term contingent acquisition liability	1,048,795
Total contingent  acquisition liability	$ 3,000,000

On June 4, 2019, Robert Bisson, received 31,500,000 shares of Beyond Commerce’s restricted common stock, Christian Schine received 31,500,000 shares of Beyond Commerce’s restricted common stock, and Ryan Rich, received 7,000,000 shares of Beyond Commerce’s restricted common stock. The business combination between Beyond Commerce and PathUX LLC, became effective May 31, 2019, when Beyond Commerce received 100% of PathUX’s membership interests. PathUX’s assets consist of the company’s website, customer lists, current customer base, and customer’s in the company’s pipeline and proprietary software. 

The following table summarizes the estimated fair values of the assets acquired and liabilities assumed based on internal company evaluations at the date of acquisition:

Assets Acquired:
Cash	$	9,066
Accounts receivable		16,327
Proprietary Software		1,063,441
Intangible asset – customer list		2,070,110
Assets acquired	$	3,158,943
Accounts payable	$	5,705
Other current liabilities		153,238
Liabilities assumed	$	158,943
Net assets acquired	$	3,000,000
Fair value of consideration given	$	3,000,000

The following unaudited pro forma consolidated results of operations have been prepared as if the acquisition of Service 800 Inc, and PathUX. occurred on January 1, 2018:

	Nine Months Ended
	September 30,
	2019		2018
Net Revenues	$	4,753,242	$	1,348,994
Net (loss) income from operations		(7,477,625)		(1,148,870)
Net (loss) income per share from operations		(0.01)		(0.00)
Weighted average number of shares – basic and diluted		1,176,847,590		1,004,144,021