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<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">As filed with the Securities and Exchange
Commission on September 18, 2017</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">Registration No. 333-</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">UNITED STATES&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 4.5pt; text-align: center; text-indent: -4.5pt">SECURITIES
AND EXCHANGE COMMISSION<BR>
Washington, D.C. 20549</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 4.5pt; text-align: center; text-indent: -4.5pt">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">FORM S-1</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">REGISTRATION STATEMENT<BR>
UNDER<BR>
THE SECURITIES ACT OF 1933</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font-size: 10pt; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 33%">&nbsp;</TD>
    <TD STYLE="width: 34%">
        <P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; border-bottom: Black 0.5pt solid">AMERI
Holdings, Inc.</P></TD>
    <TD STYLE="width: 33%">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-weight: normal">(Exact
Name of Registrant as Specified in its Charter)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="width: 32%; text-align: center; border-bottom: Black 1pt solid"><B>Delaware</B></TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 32%; text-align: center; border-bottom: Black 1pt solid"><B>7371</B></TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 32%; text-align: center; border-bottom: Black 1pt solid"><B>95-4484725</B></TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="text-align: center">(State or Other Jurisdiction of Incorporation or Organization)</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">(Primary Standard Industrial Classification Code Number)</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">(I.R.S. Employer Identification No.)</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0"><B>100 Canal Pointe
                                         Blvd., Suite 108 Princeton, New Jersey 08540</B></P>
                                   <P STYLE="margin-top: 0; margin-bottom: 0"><B>(732) 243-9250</B></P></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD COLSPAN="5" STYLE="text-align: center">(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant&rsquo;s Principal Executive Offices)</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center; border-bottom: Black 1pt solid"><P STYLE="margin-top: 0; margin-bottom: 0"><B>Giri Devanur</B></P>
                                   <P STYLE="margin-top: 0; margin-bottom: 0"><B>President and Chief Executive Officer</B></P>
                                   <P STYLE="margin-top: 0; margin-bottom: 0"><B>100 Canal Pointe Boulevard, Suite 108 Princeton,
                                   New Jersey 08540</B></P>
                                   <P STYLE="margin-top: 0; margin-bottom: 0"><B>(732) 243-9250</B></P></TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD COLSPAN="5" STYLE="text-align: center">(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service)</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; text-align: left">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">Copies to:</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; font: 10pt Times New Roman, Times, Serif; width: 100%">
<TR STYLE="vertical-align: top; text-align: left">
    <TD STYLE="text-align: center; width: 50%"><P STYLE="margin-top: 0; margin-bottom: 0"><B>Adam W. Finerman, Esq.</B></P>
                                   <P STYLE="margin-top: 0; margin-bottom: 0"><B>Olshan Frome Wolosky LLP</B></P>
                                   <P STYLE="margin-top: 0; margin-bottom: 0"><B>1325 Avenue of the Americas</B></P>
                                   <P STYLE="margin-top: 0; margin-bottom: 0"><B>New York, New York 10019</B></P>
                                   <P STYLE="margin-top: 0; margin-bottom: 0"><B>(212) 451-2300</B></P></TD>
    <TD STYLE="text-align: center; width: 50%"><P STYLE="margin-top: 0; margin-bottom: 0"><B>Stephen E Older</B></P>
                                   <P STYLE="margin-top: 0; margin-bottom: 0"><B>McGuireWoods LLP</B></P>
                                   <P STYLE="margin-top: 0; margin-bottom: 0"><B>1345 Avenue of the Americas</B></P>
                                   <P STYLE="margin-top: 0; margin-bottom: 0"><B>New York, New York 10105</B></P>
                                   <P STYLE="margin-top: 0; margin-bottom: 0"><B>(212) 548-2122</B></P></TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Approximate date of commencement of
proposed sale to the public:</B> As soon as practicable after the effective date of this registration statement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">If any of the securities being registered
on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the
following box. <FONT STYLE="font-family: Wingdings">&uml;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">If this Form is filed to register additional
securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement for the same offering. <FONT STYLE="font-family: Wingdings">&uml;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">If this Form is a post-effective amendment
filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same offering. <FONT STYLE="font-family: Wingdings">&uml;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">If this Form is a post-effective amendment
filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same offering. <FONT STYLE="font-family: Wingdings">&uml;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">Indicate by check mark
whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company,
or an emerging growth company. See the definitions of &ldquo;large accelerated filer,&rdquo; &ldquo;accelerated filer,&rdquo; &ldquo;smaller
reporting company,&rdquo; and &ldquo;emerging growth company&rdquo; in Rule 12b-2 of the Exchange Act. (Check one):</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" ALIGN="CENTER" STYLE="font-size: 10pt; width: 95%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 27%; font-size: 10pt; text-align: justify">Large accelerated filer</TD>
    <TD STYLE="width: 26%; font-size: 10pt; text-align: justify; text-indent: 0in"><FONT STYLE="font-family: Wingdings">&uml;</FONT></TD>
    <TD STYLE="width: 33%; font-size: 10pt; text-align: justify; text-indent: 0in">Accelerated filer </TD>
    <TD STYLE="width: 14%; font-size: 10pt; text-align: justify; text-indent: 0in"><FONT STYLE="font-family: Wingdings">&uml;</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="font-size: 10pt; text-align: justify; text-indent: 0in">Non-accelerated filer</TD>
    <TD STYLE="font-size: 10pt; text-align: justify; text-indent: 0in"><FONT STYLE="font-family: Wingdings">&uml;</FONT></TD>
    <TD STYLE="font-size: 10pt; text-align: justify; text-indent: 0in">Smaller reporting company </TD>
    <TD STYLE="font-size: 10pt; text-align: justify; text-indent: 0in"><FONT STYLE="font-family: Wingdings">x</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: justify; text-indent: 0in">(Do not check if a smaller reporting company)</TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">Emerging growth
company</P></TD>
    <TD STYLE="font-size: 10pt; text-align: justify; text-indent: 0in"><FONT STYLE="font-family: Wingdings">x</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">If an emerging growth company, indicate by check mark if the
registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards
provided pursuant to Section 7(a)(2)(B) of the Securities Act. <FONT STYLE="font-family: Wingdings">&uml;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">CALCULATION OF REGISTRATION FEE</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font-size: 10pt; border: Black 1pt solid; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="width: 30%; border: Black 1pt solid; font-size: 10pt; text-align: center"><B>Title of each class of</B><BR>
<B>securities to be registered</B></TD>
    <TD STYLE="width: 19%; border: Black 1pt solid; font-size: 10pt; text-align: center"><B>Amount to be registered</B></TD>
    <TD STYLE="width: 16%; border: Black 1pt solid; font-size: 10pt; text-align: center"><P STYLE="margin-top: 0; margin-bottom: 0"><B>Proposed</B></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0"><B>maximum</B><BR> <B></B></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0"><B>offering price</B><BR> <B>per unit</B></P></TD>
    <TD STYLE="width: 19%; border: Black 1pt solid; font-size: 10pt; text-align: center"><P STYLE="margin-top: 0; margin-bottom: 0"><B>Proposed</B></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0"><B>maximum</B></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0"><B>aggregate offering</B><BR> <B>price<SUP>(1)</SUP></B></P></TD>
    <TD STYLE="width: 16%; border: Black 1pt solid; font-size: 10pt; text-align: center"><B>Amount of</B><BR>
<B>registration fee</B></TD></TR>
<TR>
    <TD STYLE="border: Black 1pt solid; font-size: 10pt">Common Stock, par value $0.01 per share</TD>
    <TD STYLE="border: Black 1pt solid; font-size: 10pt; text-indent: 7.25pt; text-align: right">_______ shares<SUP>(2)</SUP></TD>
    <TD STYLE="border: Black 1pt solid; font-size: 10pt; text-align: right">$____ per share</TD>
    <TD STYLE="border: Black 1pt solid; font-size: 10pt; text-align: right; text-indent: 15.25pt">$10,000,000</TD>
    <TD STYLE="border: Black 1pt solid; font-size: 10pt; text-indent: 13.55pt; text-align: right">$1,159.00</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>TOTAL</B></P></TD>
    <TD STYLE="border: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD>
    <TD STYLE="border: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD>
    <TD STYLE="border: Black 1pt solid; font-size: 10pt; text-align: right"><B>$10,000,000</B></TD>
    <TD STYLE="border: Black 1pt solid; font-size: 10pt; text-align: right"><B>$1,159.00</B></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">__________</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 27pt">(1)</TD><TD STYLE="text-align: justify">Estimated in accordance with Rule 457 solely for the purpose of calculating the registration fee.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 27pt">(2)</TD><TD STYLE="text-align: justify">Including shares of common stock that may be purchased by the underwriters to cover over-allotments.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Registrant hereby amends this Registration Statement
on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which
specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities
Act, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission acting pursuant
to said Section 8(a), may determine.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in; color: red"><B>The information
in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed
with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell nor does it seek an offer to
buy these securities in any jurisdiction where the offer or sale is not permitted.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in; color: red">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font-size: 10pt">
<TR>
    <TD STYLE="vertical-align: top"><FONT STYLE="font-size: 10pt; color: red"><B>PRELIMINARY PROSPECTUS</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; width: 12px; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: top; text-align: center"><FONT STYLE="font-size: 10pt; color: red"><B>SUBJECT TO COMPLETION</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; width: 12px; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: top; text-align: right"><FONT STYLE="font-size: 10pt; color: red"><B>DATED SEPTEMBER __, 2017</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font-size: 10pt">
<TR>
    <TD STYLE="vertical-align: top; width: 30%"><FONT STYLE="font-size: 12pt"><B>_________ Shares</B></FONT></TD>
    <TD ROWSPAN="3" STYLE="vertical-align: bottom; width: 2%; text-align: center">&nbsp;</TD>
    <TD ROWSPAN="3" STYLE="vertical-align: top; text-align: center; width: 70%"><IMG SRC="image_001.jpg" ALT="Image result for ameri100" STYLE="height: 60px; width: 259px"></TD></TR>
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-size: 12pt"><B>Common Stock</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD><FONT STYLE="font-size: 12pt"><B>Ameri Holdings, Inc.</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We are offering an aggregate of _______
shares of our common stock, $0.01 par value per share. We anticipate a public offering price of between $___ and $___ per share
of our common stock. Our common stock is presently quoted on the OTCQB under the symbol &ldquo;AMRH&rdquo;. We have applied to
have our common stock listed on The NASDAQ Capital Market under the symbols &ldquo;AMRH&rdquo;. No assurance can be given that
our application will be approved. On September __, 2017, the last reported sale price for our common stock on the OTCQB was $____
per share. We are an &ldquo;emerging growth company&rdquo; as defined in Section 2(a) of the Securities Act of 1933, as amended,
and, as such, will be subject to reduced public reporting requirements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Investing in our common stock may be
considered speculative and involves a high degree of risk, including the risk of losing your entire investment. See &ldquo;Risk
Factors&rdquo; beginning on page 9 to read about the risks you should consider before buying shares of our common stock.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Neither the Securities and Exchange
Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy
of this prospectus. Any representation to the contrary is a criminal offense.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font-size: 10pt">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><B>Per Share</B></TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><B>Underwriting</B><BR>
<B>discounts and</B><BR>
<B>commissions<SUP>(1)</SUP></B></TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="border-bottom: black 1pt solid; text-align: center"><B>Proceeds to</B><BR>
<B>issuer<SUP>(1)</SUP></B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>Initial public offering price</TD>
    <TD STYLE="width: 12px; text-align: center">&nbsp;</TD>
    <TD STYLE="width: 23px">$</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="width: 12px; text-align: center">&nbsp;</TD>
    <TD STYLE="width: 14px">$</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="width: 12px; text-align: center">&nbsp;</TD>
    <TD STYLE="width: 15px">$</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD>Underwriting discounts and commissions<SUP>(1)</SUP></TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD>Proceeds to us</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 1px">&nbsp;</TD>
    <TD STYLE="width: 20px; text-align: justify">(1)</TD>
    <TD STYLE="text-align: justify">We refer you to &ldquo;Underwriting&rdquo; beginning on page 75 of this prospectus for additional information regarding total underwriter compensation.</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We have granted a 30-day &ldquo;over-allotment&rdquo;
option to the representative of the underwriters to purchase up to an additional _______ shares of common stock to cover allotments,
if any. The underwriters expect to deliver the shares to purchasers in the offering on or about ___________, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font-size: 10pt">
<TR>
    <TD STYLE="vertical-align: top">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">Sole Book-Running Manager</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: -10pt">&nbsp;</P>
        <P STYLE="font: 14pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><B>Ladenburg Thalmann</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; text-indent: -10pt">&nbsp;</P></TD>
    </TR>
</TABLE>
<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">The date of this prospectus is ____________,
2017.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">TABLE OF CONTENTS</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>



<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%">
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: rgb(204,238,255)">
    <TD STYLE="width: 90%; text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_001">Prospectus Summary</A></TD>
    <TD STYLE="width: 10%; text-align: right; padding-top: 0in; padding-bottom: 0pt">1</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_009">Risk Factors</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">9</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_027">Cautionary Note Regarding Forward-Looking Statements</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">27</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_028">Use of Proceeds</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">28</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_029">Dividend Policy</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">29</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_029">Capitalization</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">29</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_030">Price Range of Common Stock</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">30</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_031">Dilution</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">31</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_032">Description of Business</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">32</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_039">Management&rsquo;s Discussion and Analysis of Financial Condition and Results of Operations</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">39</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_053">Management</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">53</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_060">Executive Compensation</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">60</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_067">Certain Relationships and Related Transactions</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">67</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_069">Security Ownership of Certain Beneficial Owners and Management</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">69</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_071">Description of Capital Stock</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">71</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_074">Shares Eligible for Future Sale</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">74</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_075">Underwriting</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">75</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_079">Legal Matters</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">79</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: rgb(204,238,255)">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_079">Experts</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">79</TD></TR>
<TR STYLE="text-align: left; vertical-align: bottom; font: 10pt Times New Roman; background-color: White">
    <TD STYLE="text-align: left; text-indent: -0.25in; padding-top: 0in; padding-bottom: 0pt; padding-left: 0.25in"><A HREF="#a_079">Where You Can Find More Information</A></TD>
    <TD STYLE="text-align: right; padding-top: 0in; padding-bottom: 0pt">79</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>You should rely
only on the information contained in this prospectus. We have not authorized anyone to provide you with different information from
that contained in this prospectus. We are not making an offer of these securities in any jurisdiction where the offer is not permitted.
You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front
cover of this prospectus.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B></B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B></B>&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_001"></A>Prospectus
Summary</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>This summary highlights
certain information appearing elsewhere in this prospectus. For a more complete understanding of this offering, you should read
the entire prospectus carefully, including the risk factors and the financial statements. Unless the context indicates otherwise,
the terms &ldquo;Ameri&rdquo;, &ldquo;the Company&rdquo;, &ldquo;we&rdquo;, &ldquo;us&rdquo; and &ldquo;our&rdquo; refer to Ameri
Holdings, Inc., a Delaware corporation and its subsidiaries. </I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Our Company</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We specialize in delivering
SAP cloud, digital and enterprise services to clients worldwide.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">SAP is a leader in
providing enterprise resource planning (&ldquo;ERP&rdquo;) software and technologies to enterprise customers worldwide. We deliver
a wide range of solutions and services across multiple domains and industries. Our services include strategic consulting, operational
leadership, digital transformation services, robotics process automation and co-creation of customized solutions, including those
in mobility, sustainability, big data and cloud computing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our SAP focus allows
us to provide technological solutions to a broad and growing base of clients. We are headquartered in Princeton, NJ, and have offices
across the United States, which are supported by delivery centers in India. Our model inverts the conventional global delivery
model wherein offshore information technology (&ldquo;IT&rdquo;) service providers are based abroad and maintain a minimal presence
in the United States. With a strong SAP focus, our client partnerships anchor around SAP cloud services, artificial intelligence,
internet of things and robotic process automation. We pursue an acquisition strategy that seeks to disrupt the established business
model of offshore IT service providers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">With our innovative
solutions in enterprise architecture, ERP, predictive analytics and enterprise mobility, we provide companies worldwide with strategic
insights into their business which lead to a positive impact on their performance and profitability. In 2017, we signed a strategic
partnership agreement with NEC America to offer SAP HANA (a next generation enterprise database system) migration services. This
partnership will allow us to offer our clients a broader spectrum of services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our primary business
objective is to provide our clients with a competitive advantage by enhancing their business capabilities and technologies with
our expanding consulting services portfolio, which is aided by our business acquisitions. Our strategic acquisitions allow us to
bring global service delivery, SAP S/4 HANA and high-end SAP consulting capabilities to a broader geographic market and customer
base. We continue to leverage our growing geographical footprint and technical expertise to simultaneously expand our service and
product offering. With each acquisition, our goal is to identify business synergies that will allow us to bring new services and
products from one subsidiary to customers at our other subsidiaries. While we generate revenues from the consulting businesses
of each of our acquired subsidiaries, we believe that additional revenues will be generated through new business relationships
and services developed through our business combinations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As of July 31, 2017,
we employed approximately 275 employees in 11 locations in the United States, Canada and India. For the twelve months ended December
31, 2016 and the twelve months ended December 31, 2015, we generated revenues of $36,145,589 and $20,261,172, respectively, and
incurred comprehensive net losses of $2,788,112 and $814,075 respectively. For the six months ended June 30, 2017 and the six months
ended June 30, 2016, we generated revenues of $24,609,186 and $13,699,902, respectively, and incurred comprehensive net losses
of $5,003,010 and $2,370,074 respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Our Growth Strategy</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our growth strategy
is based on customer-driven business expansion and strategic acquisitions of SAP services companies. We introduce specific key
account management strategies to grow organically by cross selling and upselling different services across business units. It is
our goal to be a leader in the SAP cloud, digital and enterprise services market. We use strategic acquisitions, alliances and
partnerships to achieve this goal.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have complementary
near-term and longer-term strategies. In the short-term, we continue to focus on high-end consulting and solutions in the SAP space.
Our medium-term focus will be to make an entry into cloud engagements and HANA. Signing up with NEC as a strategic partner for
the SAP HANA migration will be critical to achieving this objective. Additionally, we plan to gain market share in high-growth
areas within the SAP ecosystem such as Hybris, Success Factors and BI/BW/SAP HANA. In the long-term, we plan to identify and acquire
firms in the areas of Artificial Intelligence (AI) and robotics to bolster our AIR (AI + internet of things + robotics) practice.
We believe that during each phase of our growth strategy business and market conditions will require our plans to evolve or change,
and we plan to be agile in addressing both opportunities and exigencies.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The integration of
each of our acquisitions into our business enterprise requires establishing our company&rsquo;s standard operating procedures at
each acquired entity, seamlessly transitioning each acquired entity&rsquo;s branding to the &ldquo;Ameri100&rdquo; brand and assessing
any necessity to transition account management. The integration process also requires us to evaluate any product-line expansions
made possible by the acquired entity and how to bring new product lines to the broader customer base of the entire Company. With
the integration of each acquisition, we face challenges of maintaining cross-company visibility and cooperation, creating a cohesive
corporate culture, handling unexpected customer reactions and changes and aligning the interests of the acquired entity&rsquo;s
leadership with the interests of the Company. To date, these challenges have been manageable, and we are becoming more adept at
managing integration issues with each new acquisition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Background</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We were incorporated
under the laws of the State of Delaware in February 1994 as Spatializer Audio Laboratories, Inc., which was a shell company immediately
prior to our completion of a &ldquo;reverse merger&rdquo; transaction on May 26, 2015, <FONT STYLE="background-color: white">in
which we caused Ameri100 Acquisition, Inc., a Delaware corporation and our newly created, wholly owned subsidiary, to be merged
with and into Ameri and Partners Inc (&ldquo;Ameri and Partners&rdquo;), a Delaware corporation (the &ldquo;Merger&rdquo;). As
a result of the Merger, Ameri and Partners became our wholly owned subsidiary with Ameri and Partners&rsquo; former stockholders
acquiring a majority of the outstanding shares of our common stock. The Merger was consummated under Delaware law, pursuant to
an Agreement of Merger and Plan of Reorganization, dated as of May 26, 2015 (the &ldquo;Merger Agreement&rdquo;),</FONT> and in
connection with the Merger we changed our name to AMERI Holdings, Inc. and do business under the brand name &ldquo;Ameri100&rdquo;.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Ameri Holdings Inc.,
along with its twelve subsidiaries, Ameri and Partners, Ameri Consulting Service Private Ltd., Ameri100 Georgia Inc., Bellsoft
India Solutions Private Ltd., BSI Global IT Solutions Inc., Linear Logics, Corp. Winhire Inc, Ameri100 Virtuoso Inc., Ameri100
Arizona LLC, Bigtech Software Private Limited, Ameri100 California Inc. and Ameritas Technologies India Private Limited, provides
SAP cloud, digital and enterprise services to clients worldwide.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Organizational Chart</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt"><IMG SRC="image_003.jpg" ALT="">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Additional Information</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our principal executive
offices are located at 100 Canal Pointe Blvd., Suite 108, Princeton, New Jersey 08540, and our telephone number is (732) 243-9250.
Our website is www.ameri100.com. Our website and the information contained therein or connected thereto shall not be deemed to
be incorporated herein, and you should not rely on any such information in making an investment decision.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Unless the context
indicates otherwise, as used in this prospectus, the terms the &ldquo;Company,&rdquo; &ldquo;we,&rdquo; &ldquo;us,&rdquo; and &ldquo;our&rdquo;
refer to AMERI Holdings, Inc., a Delaware corporation, and its subsidiaries taken as a whole, unless otherwise noted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Recent Acquisitions</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Acquisition
of Ameri California</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">On
March 10, 2017, we acquired 100% of the shares of ATCG Technology Solutions, Inc. (&ldquo;Ameri California&rdquo;), a Delaware
corporation, pursuant to the terms of a Share Purchase Agreement among the Company, Ameri California, all of the stockholders of
Ameri California (the &ldquo;Stockholders&rdquo;), and the Stockholders&rsquo; representative. In July 2017, the name of ATCG Technology
Solutions, Inc. was changed to Ameri100 California Inc. Ameri California provides U.S. domestic, offshore and onsite SAP consulting
services and has its main office in Folsom, California. Ameri California specializes in providing SAP Hybris, SAP Success Factors
and business intelligence services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">The
aggregate purchase price for the acquisition of Ameri California was $8,784,533, consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(a)</TD><TD STYLE="text-align: justify">576,923 shares of our common stock, valued at approximately $3.8 million based on the closing price
of our common stock on the closing date of the acquisition;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(b)</TD><TD STYLE="text-align: justify">Unsecured promissory notes issued to certain of Ameri California&rsquo;s selling stockholders for
the aggregate amount of $3,750,000 (which notes bear interest at a rate of 6% per annum and mature on June 30, 2018);</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(c)</TD><TD STYLE="text-align: justify">Earn-out payments in shares of our common stock (up to an aggregate value of $1,200,000 worth of
shares) to be paid, if earned, in each of 2018 and 2019 based on certain revenue and earnings before interest taxes, depreciation
and amortization (&ldquo;EBITDA&rdquo;) targets as specified in the purchase agreement. We estimate those targets will be fully
achieved; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(d)</TD><TD STYLE="text-align: justify">An additional cash payment of $55,687 for cash that was left in Ameri California at closing.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Acquisition
of Ameri Arizona</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">On
July 29, 2016, we acquired 100% of the membership interests of DC&amp;M Partners, L.L.C. (&ldquo;Ameri Arizona&rdquo;), an Arizona
limited liability company, pursuant to the terms of a Membership Interest Purchase Agreement by and among us, Ameri Arizona, all
of the members of Ameri Arizona, Giri Devanur and Srinidhi &ldquo;Dev&rdquo; Devanur, our President and Chief Executive Officer
and Executive Vice Chairman, respectively. In July 2017, the name of DC&amp;M Partners, L.L.C. was changed to Ameri100 Arizona
LLC. Ameri Arizona is an SAP consulting company headquartered in Chandler, Arizona. Ameri Arizona provides its clients with a wide
range of information technology development, consultancy and management services with an emphasis on the design, build and rollout
of SAP implementations and related products. Ameri Arizona is also an SAP-certified software partner, having launched its SAP reporting,
extraction and distribution tool called &ldquo;IRIS&rdquo;. Ameri Arizona services clients in diverse industries, including retail,
apparel/footwear, third-party logistics providers, chemicals, consumer goods, energy, high-tech electronics, media/entertainment
and aerospace.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">The
aggregate purchase price for the acquisition of Ameri Arizona was $15,816,000, consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(a)</TD><TD STYLE="text-align: justify">A cash payment in the amount of $3,000,000 at closing;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(b)</TD><TD STYLE="text-align: justify">1,600,000 shares of our common stock (valued at approximately $10.4 million based on the $6.51
closing price of our common stock on the closing date of the acquisition), which are to be issued on July 29, 2018 or upon a change
of control of our company (whichever occurs earlier); and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(c)</TD><TD STYLE="text-align: justify">Earn-out payments of $1,500,000 payable in cash each year to be paid, if earned, through &#9;the
achievement of annual revenue and gross margin targets in 2017 and 2018.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Acquisition
of Virtuoso</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">On
July 22, 2016, we, through wholly-owned acquisition subsidiaries, acquired all of the outstanding membership interests of Virtuoso,
L.L.C. (&ldquo;Virtuoso&rdquo;), a Kansas limited liability company, pursuant to the terms of an Agreement of Merger and Plan of
Reorganization, by and among us, Virtuoso Acquisition Inc., Ameri100 Virtuoso Inc., Virtuoso and the sole member of Virtuoso (the
&ldquo;Sole Member&rdquo;). Virtuoso is an SAP consulting firm specialized in providing services on SAP S/4 HANA finance, enterprise
mobility and cloud migration and is based in Leawood, Kansas. In connection with the merger, Virtuoso&rsquo;s name was changed
to Ameri100 Virtuoso Inc. The Virtuoso acquisition did not constitute a significant acquisition for the Company for purposes of
Regulation S-X.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">The
total purchase price paid to the Sole Member for the acquisition of Virtuoso was $1,831,881, consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(a)</TD><TD STYLE="text-align: justify">A cash payment in the amount of $675,000 which was due within 90 days of closing and was paid on
October 21, 2016;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(b)</TD><TD STYLE="text-align: justify">101,250 shares of our common stock at closing, valued at approximately $700,000 based on the $6.51
closing price of our common stock on the closing date of the acquisition; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(c)</TD><TD STYLE="text-align: justify">Earn-out payments in cash and stock of $450,000 and approximately $560,807, respectively, to be
paid, if earned, through the achievement of annual revenue and gross margin targets in 2017, 2018 and 2019. Out of the total contingent
consideration of approximately $1,000,000, we only considered 50% of the earn-out in the purchase price, mainly due to the reorganization
of Virtuoso. The Virtuoso earn-out payments for 2016 amounted to $64,736 in cash and 12,408 shares of common stock as compared
to the potential earn-out of $231,968 under the terms of the purchase agreement.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Acquisition
of Bigtech Software Private Limited</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">On
June 23, 2016, we entered into a definitive agreement to purchase Bigtech Software Private Limited (&ldquo;Bigtech&rdquo;), a pure-play
SAP services company providing a wide range of SAP services including turnkey implementations, application management, training
and basis ABAP support. Based in Bangalore, India, Bigtech offers SAP services to improve business operations at companies of all
sizes and verticals. The acquisition of Bigtech was effective as of July 1, 2016, and the total consideration for the acquisition
of Bigtech was $850,000, consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(a)</TD><TD STYLE="text-align: justify">A cash payment in the amount of $340,000 which was due within 90 days of closing and was paid on
September 22, 2016;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(b)</TD><TD STYLE="text-align: justify">Warrants for the purchase of 51,000 shares of our common stock (valued at approximately $250,000
based on the $6.51 closing price of our common stock on the closing date of the acquisition), with such warrants exercisable for
two years; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(c)</TD><TD STYLE="text-align: justify">$255,000, which may become payable in cash earn-outs to the sellers of Bigtech, if Bigtech achieves
certain pre-determined revenue and EBITDA targets in 2017 and 2018. We estimate the earn-out payments to be earned at 100% of the
targets set forth in the purchase agreement.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Bigtech&rsquo;s
financial results are included in our condensed consolidated financial results&nbsp;starting July 1, 2016.&nbsp; The Bigtech acquisition
did not constitute a significant acquisition for the Company for purposes of Regulation S-X. The valuation of Bigtech was made
on the basis of its projected revenues.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Acquisition
of Ameri Georgia</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">On
November 20, 2015, we completed the acquisition of Bellsoft, Inc., a consulting company based in Lawrenceville, Georgia with over
175 consultants specialized in the areas of SAP software, business intelligence, data warehousing and other enterprise resource
planning services. Following the acquisition, the name of Bellsoft, Inc. was changed to Ameri100 Georgia Inc. (&ldquo;Ameri Georgia&rdquo;).
Ameri Georgia has operations in the United States, Canada and India. For financial accounting purposes, we recognized September
1, 2015 as the effective date of the acquisition. The total consideration for the acquisition of Ameri Georgia was $9,910,817,
consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(a)</TD><TD STYLE="text-align: justify">A cash payment in the amount of $3,000,000, which was paid at closing;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(b)</TD><TD STYLE="text-align: justify">235,295 shares of our common stock issued at closing, valued at approximately $1,000,000 based
on the closing price of our common stock on the closing date of the acquisition;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(c)</TD><TD STYLE="text-align: justify">$250,000 quarterly cash payments to be paid on the last day of each calendar quarter of 2016;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(d)</TD><TD STYLE="text-align: justify">A $1,000,000 cash reimbursement to be paid 5 days following closing to compensate Ameri Georgia
for a portion of its approximate cash balance as of September 1, 2015;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(e)</TD><TD STYLE="text-align: justify">Approximately $2,910,817 paid within 30 days of closing in connection with the excess of Ameri
Georgia&rsquo;s accounts receivable over its accounts payable as of September 1, 2015; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(f)</TD><TD STYLE="text-align: justify">Earn-out payments of approximately $500,000 a year for 2016 and 2017, if earned through the achievement
of annual revenue and EBITDA targets specified in the purchase agreement, subject to downward or upward adjustment depending on
actual results. We estimate the earn-out payments to be earned at 100% of the targets set forth in the purchase agreement.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Offering</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 50%">Common stock offered by us&#9;</TD>
    <TD STYLE="width: 50%; text-align: justify">__________ shares of common stock</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">Common stock outstanding prior to this offering&#9;</TD>
    <TD STYLE="text-align: justify">14,650,412 shares<SUP>(1)</SUP></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Common stock outstanding after this offering</TD>
    <TD STYLE="text-align: justify">__________ shares<SUP>(1)</SUP></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">Use of proceeds&#9;</TD>
    <TD STYLE="text-align: justify">We intend to use the net proceeds of this offering to finance possible acquisitions of, or investments in, competitive businesses and for working capital and general corporate purposes.&nbsp;&nbsp;We currently have no commitments in place with respect to any acquisitions or investments.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">OTCQB Marketplace symbol&#9;</TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">AMRH</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We have applied for the listing
of our common stock on The Nasdaq Capital Market under the symbol &ldquo;AMRH&rdquo;, and expect such listing to occur concurrently
with this offering.</P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">Risk factors&#9;</TD>
    <TD STYLE="text-align: justify">See &ldquo;Risk Factors&rdquo; beginning on page 9 and the other information included in this prospectus for a discussion of factors you should carefully consider before deciding to invest in our common stock.</TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 27pt">(1)</TD><TD STYLE="text-align: justify">Based on 14,650,412 shares outstanding on September __, 2017, the number of shares to be outstanding
after this offering excludes the following:</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">309,642 shares of common stock reserved for issuance upon the exercise of outstanding stock options
and the settlement of restricted stock units under our 2015 Equity Incentive Award Plan;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">2,666,666 shares of common stock reserved for issuance upon the exercise of outstanding warrants
(for which cash would need to be remitted for us to exercise); and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">_______ shares of common stock reserved for issuance under the underwriters&rsquo; over-allotment
option.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>SUMMARY CONSOLIDATED FINANCIAL INFORMATION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>The following summary consolidated statements of operations
data for the fiscal years ended December 31, 2016 and 2015 have been derived from our audited consolidated financial statements
included elsewhere in this prospectus. Additionally, the consolidated statement of operations data for the six months ended June
30, 2016 and 2017 have been derived from our unaudited consolidated financial statements included elsewhere in this prospectus.
The summary consolidated balance sheet data as of June 30, 2017 are derived from our consolidated financial statements that are
included elsewhere in this prospectus. The historical financial data presented below is not necessarily indicative of our financial
results in future periods, and the results for the quarter ended June 30, 2017 is not necessarily indicative of our operating results
to be expected for the full fiscal year ending December 31, 2017 or any other period. You should read the summary consolidated
financial data in conjunction with those financial statements and the accompanying notes and &ldquo;Management&rsquo;s Discussion
and Analysis of Financial Condition and Results of Operations.&rdquo; Our consolidated financial statements are prepared and presented
in accordance with United States generally accepted accounting principles, or U.S. GAAP. Our consolidated financial statements
have been prepared on a basis consistent with our audited financial statements and include all adjustments, consisting of normal
and recurring adjustments that we consider necessary for a fair presentation of the financial position and results of operations
as of and for such periods.</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Fiscal Years Ended December 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; font-weight: bold">Consolidated Statement of Operations Data:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left; text-indent: 9pt">Total Revenues</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">36,145,589</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">20,261,172</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Total Cost of Revenues</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">29,608,932</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">13,391,504</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Gross Profit (Loss)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">6,536,657</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">6,869,668</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 9pt">Total Operating Expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,916,520</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">7,663,650</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Income (Loss) From Operations</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(5,379,863</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(793,982</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Total Other Income (Expense)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1,145,287</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(148,553</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 9pt">Net income (loss) before income taxes</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(6,525,150</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(942,535</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Income tax benefit (provision)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,747,846</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">128,460</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">&nbsp;&nbsp;Net income (loss)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,777,304</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(814,075</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Non-controlling interest</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(3,382</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">&nbsp;&nbsp;Net income (loss) attributable to the Company</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,780,686</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(814,075</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -9pt; padding-left: 0.25in">Foreign exchange translation adjustment</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(7,426</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; text-indent: -9pt; padding-left: 0.25in">&nbsp;Comprehensive income (loss)</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(2,788,112</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(814,075</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-indent: -9pt; padding-left: 0.25in">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -9pt; padding-left: 0.25in">Net Loss Applicable to Common Stock Per Common Share</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; text-indent: 9pt">Basic and Diluted</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(0.21</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(0.07</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-indent: 9pt">Weighted Average Shares Outstanding</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,068,597</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,101,198</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; text-indent: 9pt">Basic and Diluted</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(0.21</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(0.07</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD></TR>
</TABLE>


<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Six Months Ended June 30,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; font-weight: bold">Consolidated Statement of Operations Data:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left; text-indent: 9pt">Total Revenues</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">24,609,186</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">13,699,902</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Total Cost of Revenues</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">18,975,045</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">10,926,845</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Gross Profit (Loss)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,634,141</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,773,057</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 9pt">Total Operating Expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">9,772,964</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,691,012</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Income (Loss) From Operations</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(4,138,823</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1,917,955</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Total Other Income (Expense)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">149,326</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(386,421</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 9pt">Net income (loss) before income taxes</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,989,497</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(2,304,376</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Income tax benefit (provision)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">&nbsp;&nbsp;Net income (loss)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(3,989,497</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,304,376</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Non-controlling interest</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(11,872</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">&nbsp;&nbsp;Net income (loss) attributable to the Company</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(4,001,369</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,304,376</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Dividend on preferred stock</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,004,791</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9pt">Net income (loss) attributable to common stockholders</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(5,006,160</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(2,304,376</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -9pt; padding-left: 0.25in">Foreign exchange translation adjustment</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,150</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(65,698</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; text-indent: -9pt; padding-left: 0.25in">&nbsp;Comprehensive income (loss)</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(5,003,010</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(2,370,074</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-indent: -9pt; padding-left: 0.25in">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -9pt; padding-left: 0.25in">Net Loss Applicable to Common Stock Per Common Share</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; text-indent: 9pt">Basic and Diluted</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(0.35</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(0.19</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-indent: 9pt">Weighted Average Shares Outstanding</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; text-indent: 9pt">Basic and Diluted</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">14,352,573</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">12,359,709</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>


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<P STYLE="margin-top: 0; margin-bottom: 0"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt; text-align: right; font-size: 8pt"></P></DIV>
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<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;&nbsp;</P>
<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>As of</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30, 2017</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Actual</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><B>As&nbsp;</B><BR> <B>Adjusted<SUP>(1)</SUP></B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -13.5pt; padding-left: 13.5pt">Consolidated Balance Sheet Data:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt; text-indent: -6pt; padding-left: 13.5pt">Cash</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,041,133</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right"></TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -6pt; padding-left: 13.5pt">Total other assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">46,251,707</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -6pt; padding-left: 13.5pt">Total liabilities</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">33,672,974</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -6pt; padding-left: 13.5pt">Series A preferred stock</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,737</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -6pt; padding-left: 13.5pt">Total stockholders&rsquo; equity</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,619,866</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&mdash;&mdash;&mdash;&mdash;&mdash;&mdash;&mdash;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 32px">(1)</TD>
    <TD>As adjusted amounts give effect to&nbsp;&nbsp;the sale of the shares in this offering at the assumed public offering price of $___ per share, after deducting underwriting discounts and commissions and other estimated offering expenses payable by us.</TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<P STYLE="margin-top: 0; margin-bottom: 0"></P>

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<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_009"></A>Risk
Factors</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Investing in our
securities involves a high degree of risk. You should consider carefully the risks and uncertainties described below, together
with all of the other information in this prospectus, including our consolidated financial statements and related notes, before
deciding whether to purchase any of our securities. Any of these risks may have a material adverse effect on our business, financial
condition, results of operations and cash flows and our prospects could be harmed. In that event, the price of our securities could
decline and you could lose part or all of your investment.</I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Risks Relating to Our Business and Industry</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We recorded a net loss for
the twelve months ended December 31, 2016 and the six months ended June 30 2017, and there can be no assurance that our future
operations will result in net income.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">For the twelve months
ended December 31, 2016, we had net revenue of $36,145,589 and comprehensive loss of $2,788,112. For the six months ended June
30, 2017 and the six months ended June 30, 2016, we generated revenues of $24,609,186 and $13,699,902, respectively, and incurred
comprehensive net losses of $5,003,010 and $2,370,074 respectively. At June 30, 2017, we had stockholders&rsquo; equity of $13,619,866.
There can be no assurance that our future operations will result in net income. Our failure to increase our revenues or improve
our gross margins will harm our business. We may not be able to sustain or increase profitability on a quarterly or annual basis
in the future. If our revenues grow more slowly than we anticipate, our gross margins fail to improve or our operating expenses
exceed our expectations, our operating results will suffer. The fee we charge for our solutions and services may decrease, which
would reduce our revenues and harm our business. If we are unable to sell our solutions at acceptable prices relative to our costs,
or if we fail to develop and introduce new solutions on a timely basis and services from which we can derive additional revenues,
our financial results will suffer.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We and our subsidiaries have
limited operating histories and therefore we cannot ensure the long-term successful operation of our business or the execution
of our business plan.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our prospects must
be considered in light of the risks, expenses and difficulties frequently encountered by growing companies in new and rapidly evolving
markets, such as the technology consulting markets in which we operate. We must meet many challenges including:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">establishing and maintaining broad market acceptance of our solutions and services and converting
that acceptance into direct and indirect sources of revenue;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">establishing and maintaining adoption of our technology solutions in a wide variety of industries
and on multiple enterprise architectures;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">timely and successfully developing new solutions and services and increasing the functionality
and features of existing solutions and services;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">developing solutions and services that result in high degree of enterprise client satisfaction
and high levels of end-customer usage;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">successfully responding to competition, including competition from emerging technologies and solutions;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">developing and maintaining strategic relationships to enhance the distribution, features, content
and utility of our solutions and services; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">identifying, attracting and retaining talented personnel at reasonable market compensation rates
in the markets in which we employ.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our business strategy
may be unsuccessful and we may be unable to address the risks we face in a cost-effective manner, if at all. If we are unable to
successfully address these risks our business will be harmed.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We face working capital constraints
and may not have sufficient working capital in the long term and there is no assurance that we will be able to obtain additional
financing, which could negatively impact our business.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We currently face working
capital constraints and are not current in all payments to our vendors, a few of which have threatened legal action against us
but have not yet commenced any legalproceeding. We are working with these vendors to negotiate longer payment terms until we are
able to raise more capital. We are making efforts to mitigate our working capital constraints overall by raising more capital and
streamlining our operations to provide greater cash savings. There can be no assurance that we will be able to secure additional
sources of capital or that cost savings will provide sufficient working capital. In the event we are unable to pay outstanding
vendor payable, those vendors may take legal action against us or stop doing business with us, which may have a negative impact
on our revenue and financial results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">It is likely we may
require additional funds in the long term depending upon the growth of our revenues and our business strategy. We can give no assurance
that we will be able to obtain sufficient debt or equity capital now or in the future to support our operations. Should we be unable
to raise sufficient debt or equity capital, we could be forced to cease operations. Our plan regarding these matters is to raise
additional debt and/or equity financing to allow us the ability to cover our current cash flow requirements and meet our obligations
as they become due. There can be no assurances that financing will be available or if available, that such financing will be available
under favorable terms. In the event that we are unable to generate adequate revenues to cover expenses and cannot obtain additional
financing in the future, our business and financial condition could be harmed.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"><B><I>The economic environment,
pricing pressures, and decreased employee utilization rates could negatively impact our revenues and operating results.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Spending on technology
products and services is subject to fluctuations depending on many factors, including the economic environment in the markets in
which our clients operate.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Reduced ERP spending
in response to a challenging economic environment leads to increased pricing pressure from our clients, which may adversely impact
our revenue, gross profits, operating margins and results of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition to the
business challenges and margin pressure resulting from economic slowdown in the markets in which our clients operate and the response
of our clients to such slowdown, there is also a growing trend among consumers of ERP services towards consolidation of technology
service providers in order to improve efficiency and reduce costs. Our success in the competitive bidding process for new projects
or in retaining existing projects is dependent on our ability to fulfil client expectations relating to staffing, delivery of services
and more stringent service levels. If we fail to meet a client&rsquo;s expectations in such projects, this would likely adversely
impact our business, revenues and operating margins. In addition, even if we are successful in winning the mandates for such projects,
we may experience significant pressure on our operating margins as a result of the competitive bidding process.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Moreover, our ability
to maintain or increase pricing is restricted as clients often expect that as we do more business with them, they will receive
volume discounts or lower rates. In addition, existing and new customers are also increasingly using third-party consultants with
broad market knowledge to assist them in negotiating contractual terms. Any inability to maintain or increase pricing on account
of this practice may also adversely impact our revenues, gross profits, operating margins and results of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Uncertain global SAP consulting
market conditions may continue to adversely affect demand for our services.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We rely heavily on
global demand for ERP services, especially SAP consulting by customers. Any weakness for these ERP services by global customers
will adversely affect our revenue projections and hence our profits. SAP AG is adapting itself to the changes in the market especially
towards cloud offerings. These changes may lead to SAP losing its market share to other competitors like Oracle, Microsoft, Salesforce
and WorkDay among many other newer players. With these setbacks to SAP, we may face uncertain future due to dramatic changes in
the market place which in turn will affect our revenues and profits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"><B><I>Our success depends
largely upon our highly-skilled technology professionals and our ability to hire, attract, motivate, retain and train these personnel.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our ability to execute
projects, maintain our client relationships and acquire new clients depends largely on our ability to attract, hire, train, motivate
and retain highly skilled technology professionals, particularly project managers and other mid-level professionals. If we cannot
hire, motivate and retain personnel, our ability to bid for projects, obtain new projects and expand our business will be impaired
and our revenues could decline.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Increasing worldwide
competition for skilled technology professionals and increased hiring by technology companies may affect our ability to hire and
retain an adequate number of skilled and experienced technology professionals, which may in turn have an adverse effect on our
business, results of operations and financial condition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition, the demands
of changes in technology, evolving standards and changing client preferences may require us to redeploy and retrain our technology
professionals. If we are unable to redeploy and retrain our technology professionals to keep pace with continuing changes in technology,
evolving standards and changing client preferences, this may adversely affect our ability to bid for and obtain new projects and
may have a material adverse effect on our business, results of operations and financial condition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our strategy to increase our
growth through acquisitions may be unsuccessful and could adversely affect our business and results.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As part of our growth
strategy, we intend to further acquire other businesses; however, there is no assurance that we will be able to identify appropriate
acquisition targets, successfully acquire identified targets or successfully integrate the business of acquired companies to realize
the full benefits of the combined businesses.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">While we recently acquired
Ameri California, Ameri Arizona, Virtuoso and Bigtech in connection with our growth strategy to acquire other businesses, we can
provide no assurance that we will identify appropriate acquisition targets, successfully complete any future acquisitions or successfully
integrate the business of companies we do acquire. Even if we successfully acquire a business entity, there is no assurance that
our combined business will become profitable. The process of completing the integration of acquired businesses could cause an interruption
of, or loss of momentum in, the activities of our company and the loss of key personnel. The diversion of management&rsquo;s attention
and any delays or difficulties encountered in connection with the pursuit of business acquisitions and the integration of acquired
businesses, and the incurrence of significant, acquisition related costs in connection with proposed and completed acquisitions,
could have an adverse effect on our business, financial condition or results of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We face intense competition
from other service providers.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We are subject to intense
competition in the industry in which we operate which may adversely affect our results of operations, financial condition and cash
flows. We operate in a highly competitive industry, which is served by numerous global, national, regional and local firms. Our
industry has experienced rapid technological developments, changes in industry standards and customer requirements. The principal
competitive factors in the IT markets include the range of services offered, size and scale of service provider, global reach,
technical expertise, responsiveness to client needs, speed in delivery of IT solutions, quality of service and perceived value.
Many companies also choose to perform some or all of their back-office IT and IT-enabled operations internally. Such competitiveness
requires us to keep pace with technological developments and maintains leadership; enhance our service offerings, including the
breadth of our services and portfolio, and address increasingly sophisticated customer requirements in a timely and cost-effective
manner.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We market our service
offerings to large and medium-sized organizations. Generally, the pricing for the projects depends on the type of contract, which
includes time and material contracts, annual maintenance contracts (fixed time frame), fixed price contracts and transaction price
based contracts. The intense competition and the changes in the general economic and business conditions can put pressure on us
to change our prices. If our competitors offer deep discounts on certain services or provide services that the marketplace considers
more valuable, we may need to lower prices or offer other favorable terms in order to compete successfully. Any broad-based change
to our prices and pricing policies could cause revenues to decline and may reduce margins and could adversely affect results of
operations, financial condition and cash flows. Some of our competitors may bundle software products and services for promotional
purposes or as a long-term pricing strategy or provide guarantees of prices and product implementations. These practices could,
over time, significantly constrain the prices that we can charge for certain services. If we do not adapt our pricing models to
reflect changes in customer use of our services or changes in customer demand, our revenues and cash flows could decrease.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our competitors may
have significantly greater financial, technical and marketing resources and greater name recognition and, therefore, may be better
able to compete for new work and skilled professionals. Similarly, if our competitors are successful in identifying and implementing
newer service enhancements in response to rapid changes in technology and customer preferences, they may be more successful at
selling their services. If we are unable to respond to such changes our results of operations may be harmed. Further, a client
may choose to use its own internal resources rather than engage an outside firm to perform the types of services we provide. We
cannot be certain that we will be able to sustain our current levels of profitability or growth in the face of competitive pressures,
including competition for skilled technology professionals and pricing pressure from competitors employing an on-site/offshore
business model.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition, we may
face competition from companies that increase in size or scope as the result of strategic alliances such as mergers or acquisitions.
These transactions may include consolidation activity among hardware manufacturers, software companies and vendors and service
providers. The result of any such vertical integration may be greater integration of products and services that were once offered
separately by independent vendors. Our access to such products and services may be reduced as a result of such an industry trend,
which could adversely affect our competitive position. These types of events could have a variety of negative effects on our competitive
position and our financial results, such as reducing our revenue, increasing our costs, lowering our gross margin percentage and
requiring us to recognize impairments on our assets.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our business could be adversely
affected if we do not anticipate and respond to technology advances in our industry and our clients&rsquo; industries.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The IT and global outsourcing
and SAP consulting services industries are characterized by rapid technological change, evolving industry standards, changing client
preferences and new product introductions. Our success will depend in part on our ability to develop IT solutions that keep pace
with industry developments. We may not be successful in addressing these developments on a timely basis or at all. In addition,
products or technologies developed by others may not render our services noncompetitive or obsolete. Our failure to address these
developments could have a material adverse effect on our business, results of operations, financial condition and cash flows.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">A significant number
of organizations are attempting to migrate business applications to advanced technologies. As a result, our ability to remain competitive
will be dependent on several factors, including our ability to develop, train and hire employees with skills in advanced technologies,
breadth and depth of process and technology expertise, service quality, knowledge of industry, marketing and sales capabilities.
Our failure to hire, train and retain employees with such skills could have a material adverse impact on our business. Our ability
to remain competitive will also be dependent on our ability to design and implement, in a timely and cost- effective manner, effective
transition strategies for clients moving to advanced architectures. Our failure to design and implement such transition strategies
in a timely and cost-effective manner could have a material adverse effect on our business, results of operations, financial condition
and cash flows.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our operations and assets in
India expose us to regulatory, economic, political and other uncertainties in India, which could harm our business.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have an offshore
presence in India where a number of our technical professionals are located. In the past, the Indian economy has experienced many
of the problems confronting the economies of developing countries, including high inflation and varying gross domestic product
growth. Salaries and other related benefits constitute a major portion of our total operating costs. Many of our employees based
in India where our wage costs have historically been significantly lower than wage costs in the United States and Europe for comparably
skilled professionals, and this has been one of our competitive advantages. However, wage increases in India or other countries
where we have our operations may prevent us from sustaining this competitive advantage if wages increase. We may need to increase
the levels of our employee compensation more rapidly than in the past to retain talent. If such events occur, we may be unable
to continue to increase the efficiency and productivity of our employees and wage increases in the long term may reduce our profit
margins.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our clients may seek to reduce
their dependence on India for outsourced IT services or take advantage of the services provided in countries with labor costs similar
to or lower than India.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Clients which presently
outsource a significant proportion of their IT services requirements to vendors in India may, for various reasons, including in
response to rising labor costs in India and to diversify geographic risk, seek to reduce their dependence on one country. We expect
that future competition will increasingly include firms with operations in other countries, especially those countries with labor
costs similar to or lower than India, such as China, the Philippines and countries in Eastern Europe. Since wage costs in our industry
in India are increasing, our ability to compete effectively will become increasingly dependent on our reputation, the quality of
our services and our expertise in specific industries. If labor costs in India rise at a rate that is significantly greater than
labor costs in other countries, our reliance on the labor in India may reduce our profit margins and adversely affect our ability
to compete, which would, in turn, have a negative impact on our results of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our business could be materially
adversely affected if we do not or are unable to protect our intellectual property or if our services are found to infringe upon
or misappropriate the intellectual property of others.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our success depends
in part upon certain methodologies and tools we use in designing, developing and implementing applications systems in providing
our services. We rely upon a combination of nondisclosure and other contractual arrangements and intellectual property laws to
protect confidential information and intellectual property rights of ours and our third parties from whom we license intellectual
property. We enter into confidentiality agreements with our employees and limit distribution of proprietary information. The steps
we take in this regard may not be adequate to deter misappropriation of proprietary information and we may not be able to detect
unauthorized use of, protect or enforce our intellectual property rights. At the same time, our competitors may independently develop
similar technology or duplicate our products or services. Any significant misappropriation, infringement or devaluation of such
rights could have a material adverse effect upon our business, results of operations, financial condition and cash flows.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Litigation may be required
to enforce our intellectual property rights or to determine the validity and scope of the proprietary rights of others. Any such
litigation could be time consuming and costly. Although we believe that our services do not infringe or misappropriate on the intellectual
property rights of others and that we have all rights necessary to utilize the intellectual property employed in our business,
defense against these claims, even if not meritorious, could be expensive and divert our attention and resources from operating
our company. A successful claim of intellectual property infringement against us could require us to pay a substantial damage award,
develop non-infringing technology, obtain a license or cease selling the products or services that contain the infringing technology.
Such events could have a material adverse effect on our business, financial condition, results of operations and cash flows.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Any disruption in the supply
of power, IT infrastructure and telecommunications lines to our facilities could disrupt our business process or subject us to
additional costs.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Any disruption in basic
infrastructure, including the supply of power, could negatively impact our ability to provide timely or adequate services to our
clients. We rely on a number of telecommunications service and other infrastructure providers to maintain communications between
our various facilities and clients in India, the United States and elsewhere. Telecommunications networks are subject to failures
and periods of service disruption, which can adversely affect our ability to maintain active voice and data communications among
our facilities and with our clients. Such disruptions may cause harm to our clients&rsquo; business. We do not maintain business
interruption insurance and may not be covered for any claims or damages if the supply of power, IT infrastructure or telecommunications
lines is disrupted. This could disrupt our business process or subject us to additional costs, materially adversely affecting our
business, results of operations, financial condition and cash flows.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">System security risks and cyber-attacks
could disrupt our information technology services provided to customers, and any such disruption could reduce our expected revenue,
increase our expenses, damage our reputation and adversely affect our stock price.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Security and availability
of IT infrastructure is of the utmost concern for our business, and the security of critical information and infrastructure necessary
for rendering services is also one of the top priorities of our customers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">System security risks
and cyber-attacks could breach the security and disrupt the availability of our IT services provided to customers. Any such breach
or disruption could allow the misuse of our information systems, resulting in litigation and potential liability for us, the loss
of existing or potential clients, damage to our reputation and diminished brand value and could have a material adverse effect
on our financial condition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our network and our
deployed security controls could also be penetrated by a skilled computer hacker or intruder. Further, a hacker or intruder could
compromise the confidentiality and integrity of our protected information, including personally identifiable information; deploy
malicious software or code like computer viruses, worms or Trojan horses, etc. may exploit any security vulnerabilities, known
or unknown, of our information system; cause disruption in the availability of our information and services; and attack our information
system through various other mediums.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We also procure software
or hardware products from third party vendors that provide, manage and monitor our services. Such products may contain known or
unfamiliar manufacturing, design or other defects which may allow a security breach or cyber-attack, if exploited by a computer
hacker or intruder, or may be capable of disrupting performance of our IT services and prevent us from providing services to our
clients.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition, we manage,
store, process, transmit and have access to significant amounts of data and information that may include our proprietary and confidential
information and that of our clients. This data may include personal information, sensitive personal information, personally identifiable
information or other critical data and information, of our employees, contractors, officials, directors, end customers of our clients
or others, by which any individual may be identified or likely to be identified. Our data security and privacy systems and procedures
meet applicable regulatory standards and undergo periodic compliance audits by independent third parties and customers. However,
if our compliance with these standards is inadequate, we may be subject to regulatory penalties and litigation, resulting in potential
liability for us and an adverse impact on our business.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We are still susceptible
to data security or privacy breaches, including accidental or deliberate loss and unauthorized disclosure or dissemination of such
data or information. Any breach of such data or information may lead to identity theft, impersonation, deception, fraud, misappropriation
or other offenses in which such information may be used to cause harm to our business and have a material adverse effect on our
financial condition, business, results of operations and cash flows.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We must effectively manage
the growth of our operations, or our company will suffer.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our ability to successfully
implement our business plan requires an effective planning and management process. If funding is available, we intend to increase
the scope of our operations and acquire complimentary businesses. Implementing our business plan will require significant additional
funding and resources. If we grow our operations, we will need to hire additional employees and make significant capital investments.
If we grow our operations, it will place a significant strain on our existing management and resources. If we grow, we will need
to improve our financial and managerial controls and reporting systems and procedures, and we will need to expand, train and manage
our workforce. Any failure to manage any of the foregoing areas efficiently and effectively would cause our business to suffer.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our revenues are concentrated
in a limited number of clients and our revenues may be significantly reduced if these clients decrease their IT spending.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our client contracts
are based on time and materials expenses. We do not have long-term client contracts. Our client contracts contain standard payment
terms, and our clients only pay us for services rendered. We have limited exposure for non-payment by our clients and do not have
any unresolved client debts. While our client contracts can be terminated with little or no notice, it is uncommon for our clients
to terminate an engagement in the middle of the implementation of services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">For the twelve-month
period ended December 31, 2016, sales to five major customers accounted for 52.75% of our total revenue, and for the six-month
period ended June 30, 2017, sales to five major customers accounted for 42% of our total revenue. Consequently, if our top clients
reduce or postpone their IT spending significantly, this may lower the demand for our services and negatively affect our revenues
and profitability. Further, any significant decrease in the growth of the financial services or other industry segments on which
we focus may reduce the demand for our services and negatively affect our revenues, profitability and cash flows.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"><B><I>Our client contracts
can typically be terminated without cause and with little or no notice or penalty, which could negatively impact our revenues and
profitability.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our clients typically
retain us on a non-exclusive, project-by-project basis. Many of our client contracts can be terminated with or without cause.Our
business is dependent on the decisions and actions of our clients, and there are a number of factors relating to our clients that
are outside of our control which might lead to termination of a project or the loss of a client, including:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: left">financial difficulties for a client&#894;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: left">a change in strategic priorities, resulting in a reduced level of technology spending&#894;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: left">a demand for price reductions&#894; or an unwillingness to accept higher pricing due to various factors
such as higher wage costs, higher cost of doing business&#894;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: left">a change in outsourcing strategy by moving more work to the client&rsquo;s in-house technology departments
or to our competitors&#894;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: left">the replacement by our clients of existing software with packaged software supported by licensors&#894;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: left">mergers and acquisitions&#894;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: left">consolidation of technology spending by a client, whether arising out of mergers and acquisitions,
or otherwise&#894; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: left">sudden ramp-downs in projects due to an uncertain economic environment.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our inability to control
the termination of client contracts could have a negative impact on our financial condition and results of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"><B><I>Our engagements
with customers are typically singular in nature and do not necessarily provide for subsequent engagements.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our clients generally
retain us on a short-term, engagement-by-engagement basis in connection with specific projects, rather than on a recurring basis
under long-term contracts. Although a substantial majority of our revenues are generated from repeat business, which we define
as revenues from a client who also contributed to our revenues during the prior fiscal year, our engagements with our clients are
typically for projects that are singular in nature. Therefore, we must seek out new engagements when our current engagements are
successfully completed or terminated, and we are constantly seeking to expand our business with existing clients and secure new
clients for our services. In addition, in order to continue expanding our business, we may need to significantly expand our sales
and marketing group, which would increase our expenses and may not necessarily result in a substantial increase in business. If
we are unable to generate a substantial number of new engagements for projects on a continual basis, our business and results of
operations would likely be adversely affected.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our results of operations may
fluctuate from quarter to quarter, which could affect our business, financial condition and results of operations.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our results of operations
may fluctuate from quarter to quarter depending upon several factors, some of which are beyond our control. These factors include
the timing and number of client projects commenced and completed during the quarter, the number of working days in a quarter, employee
hiring, attrition and utilization rates and the mix of time-and-material projects versus fixed price deliverable projects and maintenance
projects during the quarter. Additionally, periodically our cost increases due to both the hiring of new employees and strategic
investments in infrastructure in anticipation of future opportunities for revenue growth.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">These and other factors
could affect our business, financial condition and results of operations, and this makes the prediction of our financial results
on a quarterly basis difficult. Also, it is possible that our quarterly financial results may be below the expectations of public
market analysts.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We are heavily dependent on
our senior management, and a loss of a member of our senior management team could cause our stock price to suffer.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If we lose Giri Devanur,
our President and Chief Executive Officer, or Viraj Patel, our Chief Financial Officer, we may not be able to find appropriate
replacements on a timely basis, and our business could be adversely affected. Our existing operations and continued future development
depend to a significant extent upon the performance and active participation of certain key individuals. We do not currently maintain
key man insurance. If we were to lose any of our key personnel, we may not be able to find appropriate replacements on a timely
basis and our financial condition and results of operations could be materially adversely affected.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Certain key employees of our
recently acquired subsidiaries may terminate their employment with us after their applicable &ldquo;earn-out&rdquo; periods end,
which could negatively impact our business.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Certain key employees
of our recently acquired subsidiaries are entitled to earn-out compensation upon the achievement of certain financial targets by
the acquired subsidiary following the closing of the acquisition. Upon the completion of the applicable earn-out period, these
key employees may terminate their employment with us. The loss of these key employees could negatively impact our business due
to the related loss of the historical associations of those key employees with markets and customers of our subsidiaries.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our international sales and
operations are subject to applicable laws relating to trade, export controls and foreign corrupt practices, the violation of which
could adversely affect its operations.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We must comply with
all applicable international trade, customs, export controls and economic sanctions laws and regulations of the United States and
other countries. We are also subject to the Foreign Corrupt Practices Act and other anti-bribery laws that generally bar bribes
or unreasonable gifts to foreign governments or officials. Changes in trade sanctions laws may restrict our business practices,
including cessation of business activities in sanctioned countries or with sanctioned entities, and may result in modifications
to compliance programs. Violation of these laws or regulations could result in sanctions or fines and could have a material adverse
effect on our financial condition, results of operations and cash flows.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our income tax returns are
subject to review by taxing authorities, and the final determination of our tax liability with respect to tax audits and any related
litigation could adversely affect our financial results.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Although we believe
that our tax estimates are reasonable and that we prepare and submit our tax filings on a timely basis and in accordance with all
applicable tax laws, the final determination with respect to any tax audits, and any related litigation, could be materially different
from our estimates or from our historical income tax provisions and accruals. The results of an audit or litigation could have
a material effect on operating results and/or cash flows in the periods for which that determination is made. In addition, future
period earnings may be adversely impacted by litigation costs, settlements, penalties and/or interest assessments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Failure of our customers to
pay the amounts owed to us in a timely manner may adversely affect our financial condition and operating results.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We generally provide
payment terms ranging from 30 to 75 days. We do not have any bad client debts and we do not have significent aged accounts receivable.
As a result, we generate significant accounts receivable from sales to our customers, representing approximately 80% of current
assets as of December 31, 2016 and approximately 81% of current assets as of June 30, 2017. Accounts receivable from sales to customers
were $8,059,910 as of December 31, 2016 and $8,720,203 as of June 30, 2017. As of June 30, 2017, the largest amount owed by a single
customer was approximately 10% of total accounts receivable. As of June 30, 2017, we had no allowance for doubtful accounts. If
any of our significant customers have insufficient liquidity, we could encounter significant delays or defaults in payments owed
to us by such customers, and we may need to extend our payment terms or restructure the receivables owed to us, which could have
a significant adverse effect on our financial condition. Any deterioration in the financial condition of our customers will increase
the risk of uncollectible receivables. Global economic uncertainty could also affect our customers&rsquo; ability to pay our receivables
in a timely manner or at all or result in customers going into bankruptcy or reorganization proceedings, which could also affect
our ability to collect our receivables.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"><B><I>If we are unable
to collect our dues or receivables from or invoice our unbilled services to our clients, our results of operations and cash flows
could be adversely affected.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our business depends
on our ability to successfully obtain payments from our clients of the amounts they owe us for work performed. We evaluate the
financial condition of our clients and usually bill and collect on relatively short cycles. Macroeconomic conditions, such as a
potential credit crisis in the global financial system, could result in financial difficulties for our clients, including limited
access to the credit markets, insolvency or bankruptcy. Such conditions could cause clients to delay payment, request modifications
of their payment terms, or default on their payment obligations to us, all of which could increase our receivables. If we experience
delays in the collection of, or are unable to collect, our client balances, our results of operations and cash flows could be adversely
affected. In addition, if we experience delays in billing and collection for our services, our cash flows could be adversely affected.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"><B><I>Goodwill that we
carry on our balance sheet could give rise to significant impairment charges in the future.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Goodwill is subject
to impairment review at least annually. Impairment testing under standards as issued by the Financial Accounting Standards Board
may lead to impairment charges in the future. Any significant impairment charges could have a material adverse effect on our results
of operations</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"><B><I>Our revenue and
operating results may be affected by the rate of growth in the use of technology in business and the type and level of technology
spending by our clients.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our business depends,
in part, upon continued reliance on the use of technology in business by our clients and prospective clients as well as their customers
and suppliers. In particular, the success of our new service offerings requires continued demand for such services and our ability
to meet this demand in a cost-effective manner. In challenging economic environments, our clients may reduce or defer their spending
on new technologies in order to focus on other priorities and prospective clients may decide not to engage our services. Also,
many companies have already invested substantial resources in their current means of conducting commerce and exchanging information,
and they may be reluctant or slow to adopt new approaches that could disrupt existing personnel, processes and infrastructures.
If the growth of technology usage in business, or our clients&rsquo; spending on such technology, declines, or if we cannot convince
our clients or potential clients to embrace new technological solutions, our revenue and operating results could be adversely affected.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"><B><I>Our business will
suffer if we fail to anticipate and develop new services and enhance existing services in order to keep pace with rapid changes
in technology and the industries on which we focus.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The ERP services market
is characterized by rapid technological changes, evolving industry standards, changing client preferences and new product and service
introductions. Our future success will depend on our ability to anticipate these advances and enhance our existing offerings or
develop new product and service offerings to meet client needs. We may not be successful in anticipating or responding to these
advances on a timely basis, or, if we do respond, the services or technologies we develop may not be successful in the marketplace.
We may also be unsuccessful in stimulating customer demand for new and upgraded products, or seamlessly managing new product introductions
or transitions. Further, products, services or technologies that are developed by our competitors may render our services non-competitive
or obsolete. Our failure to address the demands of the rapidly evolving information technology environment, particularly with respect
to digital technology, the internet of things, artificial intelligence, cloud computing and storage, mobility and applications
and analytics, could have a material adverse effect on our business, results of operations and financial condition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Changes in laws or regulations,
or a failure to comply with any laws and regulations, may adversely affect our business, investments and results of operations.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We are subject to laws
and regulations enacted by national, regional and local governments, including non-U.S. governments. In particular, we are required
to comply with certain Securities and Exchange Commission (the &ldquo;SEC&rdquo;) and other legal requirements. Compliance with,
and monitoring of, applicable laws and regulations may be difficult, time consuming and costly. Those laws and regulations and
their interpretation and application may also change from time to time and those changes could have a material adverse effect on
our business, investments and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted
and applied, could have a material adverse effect on our business and results of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our international operations
subject us to exposure to foreign currency fluctuations.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in; text-align: justify"><FONT STYLE="font-weight: normal; font-style: normal">We
have operations in three countries and as we expand our international operations, more of our customers pay us in foreign currencies.
Transactions in currencies other than U.S. dollars subject us to fluctuations in currency exchange rates. Accordingly, changes
in exchange rates between the U.S. dollar and other currencies could have a material adverse effect on our revenues and net income,
which may in turn have a negative impact on our business, results of operations, financial condition and cash flows. The exchange
rate between the U.S. dollar and other currencies has changed substantially in recent years and may fluctuate in the future. We
expect that the vast majority of our revenues will continue to be generated in U.S. dollars for the foreseeable future and that
a significant portion of our expenses, including personnel costs, as well as capital and operating expenditures, will continue
to be denominated in other currencies such as Indian Rupee. The hedging strategies that we may implement in the future to mitigate
foreign currency exchange rate risks may not reduce or completely offset our exposure to foreign exchange rate fluctuations and
may expose our business to unexpected market, operational and counterparty credit risks. Accordingly, we may incur losses from
our use of foreign exchange derivate contracts that could have a material adverse effect on our business, results of operations
and financial condition.</FONT></P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Acquisitions, expansions or
infrastructure investments may require us to increase our level of indebtedness or issue additional equity.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As we continue to consummate
additional acquisition opportunities, undertake additional expansion activities or make substantial investments in our infrastructure,
our capital needs continue to expand. Accordingly, we may need to draw down additional borrowings under our credit facility or
access public or private debt or equity markets. There can be no assurance, however, that we will be successful in raising additional
debt or equity, or that we will be able to raise such funds on terms that we would consider acceptable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">An increase in the
level of indebtedness, if any, could, among other things:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">make it difficult for us to obtain financing in the future for acquisitions, working capital, capital
expenditures, debt service requirements or other purposes;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">limit our flexibility in planning for or reacting to changes in our business;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">limit our ability to pay dividends;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">make us more vulnerable in the event of a downturn in our business; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">affect certain financial covenants with which we must comply in connection with our credit facilities.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Additionally, any further
equity offering would dilute your ownership interest in our company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Risk Factors Relating to Our Indebtedness</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We have a substantial amount
of indebtedness, which may limit our operating flexibility and could adversely affect our results of operations and financial condition.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As of June 30, 2017,
we had approximately $5.8 million in borrowings outstanding under our $10 million credit facility (the &ldquo;Credit Facility&rdquo;),
which provides for up to $8 million in principal for revolving loans (the &ldquo;Revolving Loans&rdquo;) for general working capital
purposes, up to $2 million in principal pursuant to a term loan (the &ldquo;Term Loan&rdquo;) for the purpose of a permitted business
acquisition and up to $200,000 for letters of credit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our indebtedness could
have important consequences to our investors, including, but not limited to:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">increasing our vulnerability to, and reducing our flexibility to respond to, general adverse economic
and industry conditions;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">requiring the dedication of a substantial portion of our cash flow from operations to the payment
of principal of, and interest on, our indebtedness, thereby reducing the availability of such cash flow to fund working capital,
capital expenditures, acquisitions, joint ventures or other general corporate purposes;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">limiting our flexibility in planning for, or reacting to, changes in our business, the competitive
environment and the industry in which we operate; &#9;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">placing us at a competitive disadvantage as compared to our competitors that are not as highly
leveraged; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">limiting our ability to borrow additional funds and increasing the cost of any such borrowing.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">A breach of a covenant
or restriction contained in our senior secured credit facility could result in a default that could in turn permit the affected
lender to accelerate the repayment of principal and accrued interest on our outstanding loans and terminate its commitments to
lend additional funds. If the lender under such indebtedness accelerates the repayment of our borrowings, we cannot assure you
that we will have sufficient assets to repay those borrowings as well as any other indebtedness.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Interest under the
Credit Facility is payable monthly in arrears and accrues as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(a)</TD><TD STYLE="text-align: justify">in the case of Revolving Loans, a rate per annum equal to the sum of (i) the Wall Street Journal
Prime Rate plus (ii) 2.00%;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(b)</TD><TD STYLE="text-align: justify">in the case of the Term Loan, a rate per annum equal to the sum of (i) the Wall Street Journal
Prime Rate plus (ii) 3.75%; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(c)</TD><TD STYLE="text-align: justify">in the case of other obligations under the Credit Facility, a rate per annum equal to the sum of
(i) the greater of (A) 3.25% or (B) Wall Street Journal Prime Rate plus (ii) 3.75%.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Credit Facility
also requires the payment of certain fees, including, but not limited to letter of credit fees and an unused Revolving Loans fee.
An increase in interest rates would adversely affect our profitability. To the extent that our access to credit is restricted because
of our own performance or conditions in the capital markets generally, our financial condition would be materially adversely affected.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">To date, we are not
in compliance with the financial covenants contained in the loan agreement with Sterling National Bank. W<FONT STYLE="background-color: white">e
received a waiver from Sterling National Bank for our non-compliance with the loan agreement for the quarters ended March 31, 2017
and June 30, 2017 in exchange for the payment of a fee of $5,000 for each quarterly waiver. We do not expect to be in compliance
with the terms of the loan agreement following the conclusion of the terms of the waivers granted by Sterling National Bank. We
are continuing to work with Sterling National Bank to address our on-going non-compliance. In the event Sterling National Bank
were to discontinue granting us waivers and call a default on the loan agreement, we would be forced to find another lender to
take its place and we would face greater short-term working capital constraints, which could adversely affect our operations and
our financial results.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition, we have
an outstanding aggregate of $1,250,000 in 8% Convertible Unsecured Promissory Notes (the &ldquo;2017 Notes&rdquo;), which were
issued to four accredited investors, including one of the Company&rsquo;s directors, Dhruwa N. Rai. The 2017 Notes bear interest
at 8% per annum until maturity in March 2020, with interest being paid annually on the first, second and third anniversaries of
the issuance of the 2017 Notes beginning in March 2018. From and after an event of default and for so long as the event of default
is continuing, the 2017 Notes will bear default interest at the rate of 10% per annum. The 2017 Notes can be prepaid by us at any
time without penalty.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The 2017 Notes are
convertible into shares of our common stock at a conversion price equal to $_____ (equal to 68% of the price per share of the common
stock sold in this offering). Upon the effectiveness of this registration statement, the holders of the 2017 Notes have the right,
at their option, at any time and from time to time to convert, in part or in whole, the outstanding principal amount and all accrued
and unpaid interest under the 2017 Notes into shares of the Company&rsquo;s common stock at the then applicable conversion price.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The 2017 Notes rank
junior to our secured credit facility with Sterling National Bank. The 2017 Notes also include certain negative covenants including,
without the investors&rsquo; approval, restrictions on dividends and other restricted payments and reclassification of its stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our level of indebtedness
may make it difficult to service our debt and may adversely affect our ability to obtain additional financing, use operating cash
flow in other areas of our business or otherwise adversely affect our operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our Credit Facility contains
restrictive covenants that may impair our ability to conduct business.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Credit Facility
contains a number of customary affirmative and negative covenants that, among other things, will limit or restrict our ability
to: incur additional indebtedness (including guaranty obligations); incur liens; engage in mergers, consolidations, liquidations
and dissolutions (other than pursuant to transactions approved by the lender); sell assets; pay dividends and make other payments
in respect of capital stock; make acquisitions, investments, loans and advances; pay and modify the terms of certain indebtedness;
engage in certain transactions with affiliates; enter into negative pledge clauses and clauses restricting subsidiary distributions;
and change its line of business, in each case, subject to certain limited exceptions. As a result of these covenants and restrictions,
we are limited in how we conduct our business and we may be unable to raise additional debt or other financing to compete effectively
or to take advantage of new business opportunities. The terms of any future indebtedness we may incur could include more restrictive
covenants. Failure to comply with such restrictive covenants may lead to default and acceleration under our Credit Facility and
may impair our ability to conduct business. We may not be able to maintain compliance with these covenants in the future and, if
we fail to do so, we may not be able to obtain waivers from the lenders and/or amend the covenants, which may adversely affect
our financial condition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Upon the occurrence of an event
of default under our Credit Facility, our lender could elect to accelerate payments due and terminate all commitments to extend
further credit. Consequently, we may not have sufficient assets to repay the Credit Facility.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Upon the occurrence
of an event of default under our Credit Facility, the lender thereunder could elect to declare all amounts outstanding to be immediately
due and payable and terminate all commitments to extend further credit. If we were unable to repay those amounts, the lender under
the Credit Facility could proceed against the collateral granted to them to secure that indebtedness. The Company has pledged substantially
all of its assets as collateral under the Credit Facility. If the lender accelerates the repayment of borrowings, we cannot assure
you that we will have sufficient assets to repay the Credit Facility.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Risks Relating to this Offering and our Common Stock</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Purchasers in this offering
will experience immediate and substantial dilution in the book value of their investment.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The public offering
price of our common stock will be substantially higher than the net tangible book value per share of our common stock immediately
after this offering. Therefore, if you purchase our common stock in this offering, you will incur an immediate dilution of $___
(or __%) in net tangible book value per share from the price you paid, based on an assumed public offering price of $____ per share.
The exercise of outstanding warrants and options and the settlement of outstanding restricted stock units and conversion of the
2017 Notes may result in further dilution of your investment. In addition, if we raise funds by issuing additional shares or convertible
securities in the future, the newly issued shares may further dilute your ownership interest.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We may apply the proceeds of
this offering to uses that ultimately do not improve our operating results or increase the value of your investment.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We intend to use the
net proceeds from this offering to fund additional acquisition opportunities and for working capital and general corporate purposes.
Depending on several factors, including the availability of alternate sources of capital and the possibility that the execution
or timing of our business plans may change, management may use these proceeds in a manner different than originally intended. These
proceeds could be applied in ways that do not improve our operating results or otherwise increase the value of your investment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">There is a limited market for
our securities, which may make it more difficult to dispose of our securities and we may fail to qualify for listing on The Nasdaq
Capital Market, which could make it more difficult for investors to sell their shares.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our common stock is
currently quoted on the OTCQB Marketplace. There is a limited trading market for our common stock. We have submitted an initial
listing application on The Nasdaq Capital Market in connection with this offering. Our initial listing application may not be granted,
as we may not meet the required listing criteria of The Nasdaq Capital Market. In the event the listing of our common stock is
approved by The Nasdaq Capital Market or other exchange, there can be no assurance that trading of our common stock on such market
will be sustained or desirable. In the event that our common stock fails to qualify for initial or continued listing, our common
stock could thereafter only be quoted on the OTC Bulletin Board or on what are commonly referred to as the &ldquo;pink sheets&rdquo;
operated by OTC Markets Group, Inc. Under such circumstances, you may find it more difficult to dispose of, or to obtain accurate
quotations, for our common stock, and our common stock would become substantially less attractive to certain purchasers, such as
financial institutions, hedge funds and other similar investors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our common stock may be affected
by limited trading volume and price fluctuations, each of which could adversely impact the value of our common stock.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">There has been very
limited trading in our common stock and there can be no assurance that an active trading market in our common stock will either
develop or be maintained. Our common stock has experienced, and is likely to experience in the future, significant price and volume
fluctuations, which could adversely affect the market price of our common stock without regard to our operating performance. In
addition, we believe that factors such as quarterly fluctuations in our financial results and changes in the overall economy or
the condition of the financial markets could cause the price of our common stock to fluctuate substantially. These fluctuations
may also cause short sellers to enter the market from time to time in the belief that we will have poor results in the future.
We cannot predict the actions of market participants and, therefore, can offer no assurances that the market for our stock will
be stable or appreciate over time.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our stock price may be volatile,
which could result in substantial losses for investors.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The market price of
our common stock may be volatile and could fluctuate widely in response to various factors, many of which are beyond our control,
including the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">technological innovations or new products and services by us or our competitors;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">additions or departures of key personnel;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">sales of our common stock, including management shares;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">limited availability of freely-tradable &ldquo;unrestricted&rdquo; shares of our common stock to
satisfy purchase orders and demand;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">our ability to execute our business plan;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">operating results that fall below expectations;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">loss of any strategic relationship;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">industry developments;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">economic and other external factors;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">our ability to manage the costs of maintaining adequate internal financial controls and procedures
in connection with the acquisition of additional businesses; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">period-to-period fluctuations in our financial results.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition, the securities
markets have from time to time experienced significant price and volume fluctuations that are unrelated to the operating performance
of particular companies. These market fluctuations may also significantly affect the market price of our common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">A significant number of our
shares will be eligible for sale and their sale or potential sale may depress the market price of our common stock.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Sales of a significant
number of shares of our common stock in the public market could harm the market price of our common stock. When this offering is
completed, we will have a total of _____ shares of common stock outstanding, assuming no exercise of the underwriters&rsquo; over-allotment
option and no exercise of outstanding stock options and warrants, settlement of outstanding restricted stock units or conversion
of the 2017 Notes. The _________ shares offered by this prospectus, assuming no exercise of the underwriters&rsquo; over-allotment
option, will be freely tradeable unless they are purchased by our &ldquo;affiliates,&rdquo; as defined in Rule 144 under the Securities
Act of 1933, as amended (the &ldquo;Securities Act&rdquo;). An additional 1,987,342 shares are freely tradeable unless they are
purchased by our &ldquo;affiliates,&rdquo; as defined in Rule 144 under the Securities Act of 1933, as amended. The remaining 12,632,675
shares outstanding are &ldquo;restricted,&rdquo; which means they were originally sold in offerings, or issued as acquisition consideration,
that were not subject to a registration statement filed with the SEC. These restricted shares may be resold only through registration
under the Securities Act or under an available exemption from registration, such as provided through Rule 144.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition, 6,450,838
shares are issuable upon exercise of options and warrants, settlement of restricted stock units and conversion of the 2017 Notes.
Pursuant to an effective registration statement, 2,666,666 shares issuable upon exercise of outstanding warrants are freely tradeable
unless they are purchased by our &ldquo;affiliates,&rdquo; as defined in Rule 144 under the Securities Act. If any options are
exercised, restricted stock units are settled or the 2017 Notes are converted, the shares issued upon such exercise, settlement
or conversion (as applicable) will also be restricted, but may be sold under Rule 144 after the shares have been held for six months.
Sales under Rule 144 may be subject to volume limitations and other conditions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition to the
possibility that actual sales of significant amounts of our common stock in the public market could harm our common stock price,
the fact that our stockholders have the ability to make such sales could create a circumstance commonly referred to as an &ldquo;overhang,&rdquo;
in anticipation of which the market price of our common stock could fall. The existence of an overhang, whether or not sales have
occurred or are occurring, could also make it more difficult for us to raise additional financing through the sale of equity or
equity-related securities in the future at a time and price that we deem reasonable or appropriate.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We do not expect to pay dividends
in the future. As a result, any return on investment may be limited to the value of our common stock.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have never paid
cash dividends on our common stock and do not anticipate paying cash dividends on our common stock in the foreseeable future. The
payment of dividends on our common stock will depend on our earnings, financial condition and other business and economic factors
as our board of directors may consider relevant. In addition, no dividends will be declared or paid or set apart for payment on
our common stock unless all accumulated accrued and unpaid dividends in respect of our Series A Preferred Stock are contemporaneously
declared and paid in cash or declared and a sum of cash sufficient for the payment thereof set apart for such payment on the Series
A Preferred Stock for all past dividend periods with respect to which full dividends were not paid on the Series A Preferred Stock
in cash. If we do not pay dividends, our common stock may be less valuable because a return on your investment will only occur
if our stock price appreciates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"><B><I>The terms of our
financing agreements may limit our ability to pay dividends on the Series A Preferred Stock.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Financing agreements,
whether ours or those of our subsidiaries and whether in place now or in the future may include restrictions on our ability to
pay cash dividends on our capital stock, including the Series A Preferred Stock. These limitations may cause us to be unable to
pay dividends on the Series A Preferred Stock unless we can refinance amounts outstanding under those agreements. We do not intend
to pay cash dividends to the extent we are restricted by any of our financing arrangements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>We currently have Series A Preferred
Stock outstanding and our certificate of incorporation authorizes our board of directors to create new series of preferred stock
without further approval by our stockholders, which could adversely affect the rights of the holders of our common stock.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our board of directors
has the authority to fix and determine the relative rights and preferences of preferred stock. Our board of directors also has
the authority to issue preferred stock without further stockholder approval. We currently have outstanding Series A Preferred Stock
which gives its holders the preferred right to our assets upon liquidation, the right to receive dividend payments before dividends
are distributed to the holders of common stock and the right to the redemption of the shares, together with a premium, prior to
the redemption of our common stock. In addition, our board of directors could authorize the issuance of additional series of preferred
stock with such rights preferential to the rights of our common stock, including the issuance of a series of preferred stock that
has greater voting power than our common stock or that is convertible into our common stock, which could decrease the relative
voting power of our common stock or result in dilution to our existing stockholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Because certain of our stockholders
control a significant number of shares of our common stock, they may have effective control over actions requiring stockholder
approval.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our directors, executive
officers and principal stockholders, and their respective affiliates, beneficially own approximately 81.29% of our outstanding
shares of common stock before giving effect to the sale of our common stock pursuant to this offering.&nbsp;Accordingly, our executive
officers, directors and principal stockholders, and their respective affiliates, will have significant influence on the ability
to control the Company and the outcome of issues submitted to our stockholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>If securities or industry analysts
do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could
decline.</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The trading market
for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our
business. We do not currently have research coverage by securities and industry analysts and you should not invest in our common
stock in anticipation that we will obtain such coverage. If we obtain securities or industry analyst coverage and if one or more
of the analysts who covers us downgrades our stock or publishes inaccurate or unfavorable research about our business, our stock
price would likely decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly,
demand for our stock could decrease, which could cause our stock price and trading volume to decline.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">If the benefits of any proposed
acquisition of do not meet the expectations of investors, stockholders or financial analysts, the market price of our common stock
may decline.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If the benefits of
any proposed acquisition of do not meet the expectations of investors or securities analysts, the market price of our common stock
prior to the closing of the proposed acquisition may decline. The market values of our common stock at the time of the proposed
acquisition may vary significantly from their prices on the date the acquisition target was identified.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition, broad
market and industry factors may materially harm the market price of our common stock irrespective of our operating performance.
The stock market in general has experienced price and volume fluctuations that have often been unrelated or disproportionate to
the operating performance of the particular companies affected. The trading prices and valuations of these stocks, and of our securities,
may not be predictable. A loss of investor confidence in the market for retail stocks or the stocks of other companies which investors
perceive to be similar to us could depress our stock price regardless of our business, prospects, financial conditions or results
of operations. A decline in the market price of our securities also could adversely affect our ability to issue additional securities
and our ability to obtain additional financing in the future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Changes in accounting principles
and guidance, or their interpretation, could result in unfavorable accounting charges or effects, including changes to our previously
filed financial statements, which could cause our stock price to decline.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We prepare our consolidated
financial statements in accordance with GAAP. These principles are subject to interpretation by the SEC and various bodies formed
to interpret and create appropriate accounting principles and guidance.&nbsp;A change in these principles or guidance, or in their
interpretations, may have a significant effect on our reported results and retroactively affect previously reported results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Being a public company results
in additional expenses, diverts management&rsquo;s attention and could also adversely affect our ability to attract and retain
qualified directors.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As a public reporting
company, we are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the &ldquo;Exchange Act&rdquo;).
These requirements generate significant accounting, legal and financial compliance costs and make some activities more difficult,
time consuming or costly and may place significant strain on our personnel and resources. The Exchange Act requires, among other
things, that we maintain effective disclosure controls and procedures and internal control over financial reporting. In order to
establish the requisite disclosure controls and procedures and internal control over financial reporting, significant resources
and management oversight are required.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As a result, management&rsquo;s
attention may be diverted from other business concerns, which could have an adverse and even material effect on our business, financial
condition and results of operations.&nbsp;These rules and regulations may also make it more difficult and expensive for us to obtain
director and officer liability insurance.&nbsp;If we are unable to obtain appropriate director and officer insurance, our ability
to recruit and retain qualified officers and directors, especially those directors who may be deemed independent, could be adversely
impacted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We are an &ldquo;emerging growth
company&rdquo; and our election to delay adoption of new or revised accounting standards applicable to public companies may result
in our financial statements not being comparable to those of some other public companies. As a result of this and other reduced
disclosure requirements applicable to emerging growth companies, our securities may be less attractive to investors.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As a public reporting
company with less than $1,070,000,000 in revenue during our last fiscal year, we qualify as an &ldquo;emerging growth company&rdquo;
under the Jumpstart our Business Startups Act of 2012 (the &ldquo;JOBS Act&rdquo;).&nbsp;An emerging growth company may take advantage
of certain reduced reporting requirements and is relieved of certain other significant requirements that are otherwise generally
applicable to public companies. In particular, as an emerging growth company we:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">are not required to obtain an attestation and report from our auditors on our management&rsquo;s
assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">are not required to provide a detailed narrative disclosure discussing our compensation principles,
objectives and elements and analyzing how those elements fit with our principles and objectives (commonly referred to as &ldquo;compensation
discussion and analysis&rdquo;);</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">are not required to obtain a non-binding advisory vote from our stockholders on executive compensation
or golden parachute arrangements (commonly referred to as the &ldquo;say-on-pay,&rdquo; &ldquo;say-on-frequency&rdquo; and &ldquo;say-on-golden-parachute&rdquo;
votes);</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">are exempt from certain executive compensation disclosure provisions requiring a pay-for-performance
graph and CEO pay ratio disclosure;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">may present only two years of audited financial statements and only two years of related Management&rsquo;s
Discussion &amp; Analysis of Financial Condition and Results of Operations (&ldquo;MD&amp;A&rdquo;); and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">are eligible to claim longer phase-in periods for the adoption of new or revised financial accounting
standards under &sect;107 of the JOBS Act.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We intend to take advantage
of all of these reduced reporting requirements and exemptions, including the longer phase-in periods for the adoption of new or
revised financial accounting standards under &sect;107 of the JOBS Act. Our election to use the phase-in periods may make it difficult
to compare our financial statements to those of non-emerging growth companies and other emerging growth companies that have opted
out of the phase-in periods under &sect;107 of the JOBS Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Certain of these reduced
reporting requirements and exemptions were already available to us due to the fact that we also qualify as a &ldquo;smaller reporting
company&rdquo; under SEC rules. For instance, smaller reporting companies are not required to obtain an auditor attestation and
report regarding management&rsquo;s assessment of internal control over financial reporting; are not required to provide a compensation
discussion and analysis; are not required to provide a pay-for-performance graph or Chief Executive Officer pay ratio disclosure;
and may present only two years of audited financial statements and related MD&amp;A disclosure.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Under the JOBS Act,
we may take advantage of the above-described reduced reporting requirements and exemptions for up to five years after our initial
sale of common equity pursuant to a registration statement declared effective under the Securities Act of 1933, as amended (the
&ldquo;Securities Act&rdquo;), or such earlier time that we no longer meet the definition of an emerging growth company. In this
regard, the JOBS Act provides that we would cease to be an &ldquo;emerging growth company&rdquo; if we have more than $1,070,000,000
in annual revenues, have more than $700 million in market value of our common stock held by non-affiliates, or issue more than
$1.0 billion in principal amount of non-convertible debt over a three-year period. Further, under current SEC rules we will continue
to qualify as a &ldquo;smaller reporting company&rdquo; for so long as we have a public float (i.e., the market value of common
equity held by non-affiliates) of less than $75 million as of the last business day of our most recently completed second fiscal
quarter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We cannot predict if
investors will find our securities less attractive due to our reliance on these exemptions.&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Failure to establish and maintain
effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on our
business and stock price.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We are required to
comply with the SEC&rsquo;s rules implementing Sections 302 and 404 of the Sarbanes-Oxley Act, which require management to certify
financial and other information in our quarterly and annual reports and provide an annual management report on the effectiveness
of controls over financial reporting. Though we are required to disclose changes made in our internal controls and procedures on
a quarterly basis, we will not be required to make our first annual assessment of our internal control over financial reporting
pursuant to Section 404 until year-end 2017. However, as an emerging growth company, our independent registered public accounting
firm will not be required to formally attest to the effectiveness of our internal control over financial reporting pursuant to
Section 404 until the end of the fiscal year for which our second annual report is due or the date we are no longer an emerging
growth company. At such time, our independent registered public accounting firm may issue a report that is adverse in the event
it is not satisfied with the level at which our controls are documented, designed or operating.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">To comply with the
requirements of being a public company, we have undertaken various actions, and may need to take additional actions, such as implementing
new internal controls and procedures and hiring additional accounting or internal audit staff. Testing and maintaining internal
control can divert our management&rsquo;s attention from other matters that are important to the operation of our business. Additionally,
when evaluating our internal control over financial reporting, we may identify material weaknesses that we may not be able to remediate
in time to meet the applicable deadline imposed upon us for compliance with the requirements of Section 404. If we identify any
material weaknesses in our internal control over financial reporting or are unable to comply with the requirements of Section 404
in a timely manner or assert that our internal control over financial reporting is effective, or if our independent registered
public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting
once we are no longer an emerging growth company, investors may lose confidence in the accuracy and completeness of our financial
reports and the market price of our common stock could be negatively affected, and we could become subject to investigations by
the Financial Industry Regulatory Agency, the SEC or other regulatory authorities, which could require additional financial and
management resources.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Anti-takeover provisions contained
in our certificate of incorporation and bylaws, as well as provisions of Delaware law, could impair a takeover attempt.</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company&rsquo;s
certificate of incorporation and bylaws contain provisions that could have the effect of delaying or preventing changes in control
or changes in our management without the consent of our board of directors. These provisions include:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">no cumulative voting in the election of directors, which limits the ability of minority stockholders
to elect director candidates;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">the exclusive right of our board of directors to elect a director to fill a vacancy created by
the expansion of the board of directors or the resignation, death, or removal of a director, which prevents stockholders from being
able to fill vacancies on our board of directors;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">the ability of our board of directors to determine whether to issue shares of our preferred stock
and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval,
which could be used to significantly dilute the ownership of a hostile acquirer;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">limiting the liability of, and providing indemnification to, our directors and officers;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">controlling the procedures for the conduct and scheduling of stockholder meetings;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">providing that directors may be removed prior to the expiration of their terms by stockholders
only for cause; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">advance notice procedures that stockholders must comply with in order to nominate candidates to
our board of directors or to propose matters to be acted upon at a stockholders&rsquo; meeting, which may discourage or deter a
potential acquirer from conducting a solicitation of proxies to elect the acquirer&rsquo;s own slate of directors or otherwise
attempting to obtain control of the Company.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">These provisions, alone
or together, could delay hostile takeovers and changes in control of the Company or changes in our board of directors and management.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Any provision of our
certificate of incorporation or bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit
the opportunity for our security holders to receive a premium for their securities and could also affect the price that some investors
are willing to pay for our securities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_027"></A>Cautionary
Note Regarding Forward-Looking Statements</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">This prospectus contains
forward-looking statements within the meaning of the &ldquo;safe harbor&rdquo; provisions of the Private Securities Litigation
Reform Act of 1995. Specifically, forward-looking statements may include statements relating to:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">our future financial performance;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">changes in the market for our products;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">our expansion plans and opportunities; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">other statements preceded by, followed by or that include the words &ldquo;estimate,&rdquo; &ldquo;plan,&rdquo;
&ldquo;project,&rdquo; &ldquo;forecast,&rdquo; &ldquo;intend,&rdquo; &ldquo;expect,&rdquo; &ldquo;anticipate,&rdquo; &ldquo;believe,&rdquo;
&ldquo;seek,&rdquo; &ldquo;target&rdquo; or similar expressions.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">These forward-looking
statements are based on information available as of the date of this prospectus and current expectations, forecasts and assumptions,
and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as
representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to
reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise,
except as may be required under applicable securities laws.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As a result of a number
of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed
or implied by these forward-looking statements. Some factors that could cause actual results to differ include:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">the level of demand for our products;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">competition in our markets;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">our ability to grow and manage growth profitably;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">our ability to access additional capital;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">changes in applicable laws or regulations;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">our ability to attract and retain qualified personnel;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">the possibility that we may be adversely affected by other economic, business, and/or competitive
factors; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">other risks and uncertainties indicated in this prospectus, including those under &ldquo;Risk Factors.&rdquo;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_028"></A>Use
of Proceeds<FONT STYLE="font-family: Times New Roman, Times, Serif; font-size: 10pt"><B><SUP></SUP></B></FONT></P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We estimate the net
proceeds to us from the sale of the common stock in this offering will be approximately $___________, or approximately $__________
if the underwriters&rsquo; over-allotment option is exercised in full, based on an assumed public offering price of $______ per
share and after deducting the underwriting discount and our estimated offering expenses.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We intend to use the
net proceeds from this offering for the following purposes and in the following order of priority:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 90%; margin-left: 0.5in">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; font-weight: bold; border-bottom: Black 1pt solid">Purpose</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Estimated<BR> Amount</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Estimated<BR> Percentage of Net Proceeds</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 66%; font-size: 10pt; text-align: left">Funding of potential acquisitions</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 14%; font-size: 10pt">$</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 14%; font-size: 10pt; text-align: right"></TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Working capital and general corporate purposes</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">$</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right"></TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-indent: 8.75pt">Total</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">$</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">100.0</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We plan to use a significant
portion of the net proceeds of this offering to finance acquisitions of, or investments in, competitive and complementary businesses
as a part of our growth strategy. We currently have no commitments in place with respect to any such acquisitions or investments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Working capital and
general corporate purposes include amounts required to pay for research &amp; development expenses, salaries, professional fees,
public reporting costs, office-related expenses and other corporate expenses, including interest and overhead.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Investors are cautioned
that expenditures may vary substantially from the estimates above. Investors will be relying on the judgment of our management,
who will have broad discretion regarding the application of the proceeds of this offering. The amounts and timing of our actual
expenditures will depend upon numerous factors, including our potential investments in new businesses, the amount of cash generated
by our operations, the amount of competition we face and other operational factors. We may find it necessary or advisable to use
portions of the proceeds from this offering for other purposes. From time to time, we evaluate these and other factors and we anticipate
continuing to make such evaluations to determine if the existing allocation of resources, including the proceeds of this offering,
is being optimized. Circumstances that may give rise to a change in the use of proceeds include:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">our ability to negotiate definitive agreements with acquisition candidates;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">the availability and terms of debt financing to fund a portion of the purchase price(s) for potential
acquisitions;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">the need or desire on our part to accelerate, increase or eliminate existing initiatives due to,
among other things, changing market conditions and competitive developments; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">the availability of other sources of cash including cash flow from operations and new bank debt
financing arrangements, if any.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Pending the use of
net proceeds of this offering, we intend to invest most of the net proceeds from this offering in short-term, investment-grade,
interest-bearing securities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-right: 0; margin-bottom: 0pt; text-align: left"><B><FONT>&nbsp;</FONT></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-right: 0; margin-bottom: 0pt; text-align: left"><B><FONT></FONT></B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-right: 0; margin-bottom: 0pt; text-align: left"><B>&nbsp;</B></P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_029"></A>Dividend
Policy</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has not
paid any dividends on its common stock to date. It is the present intention of the Company to retain any earnings for use in its
business operations and, accordingly, the Company does not anticipate the board of directors declaring any dividends in the foreseeable
future on its common stock. In addition, certain of our loan agreements restrict the payment of dividends and the terms of the
Company&rsquo;s Series A Preferred Stock may from time to time prevent it from paying cash dividends on its common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">Capitalization</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following table
summarizes our cash and cash equivalents and capitalization as of June 30, 2017:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">on an actual basis; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">on an as adjusted basis, giving effect to our receipt of the net proceeds from the sale by us in
this offering of shares of common stock at an assumed public offering price of $___ per share, after deducting estimated underwriting
discounts and commissions and estimated offering expenses payable by us.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">As of June 30, 2017</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Actual</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">As Adjusted</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="7" NOWRAP STYLE="font-size: 10pt; text-align: center">(in thousands, except per share amounts)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left; padding-bottom: 2.5pt; text-indent: -8.65pt; padding-left: 8.65pt">Cash and cash equivalents</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,041</TD><TD STYLE="width: 1%; border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right"></TD><TD STYLE="width: 1%; border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-indent: -8.65pt; padding-left: 8.65pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -8.65pt; padding-left: 8.65pt">Short-term debt, including current portion of long-term debt</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">4,511</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -8.65pt; padding-left: 8.65pt">Long-term debt, less current portion</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,334</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -8.65pt; padding-left: 8.65pt">Stockholders&rsquo; equity:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -8.65pt; padding-left: 25.9pt">Preferred stock, par value $0.01; 1,000,000 shares authorized, 373,708 shares issued and outstanding, actual; 1,000,000 authorized, 373,708 shares issued and outstanding, as adjusted</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -8.65pt; padding-left: 27pt">Common stock; par value $0.01; 100,000,000 shares authorized, 14,650,412 shares issued and outstanding, actual; 100,000,000 shares authorized, _______ shares issued and outstanding, as adjusted<SUP>(1)</SUP></TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">147</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -8.65pt; padding-left: 25.9pt">Additional paid-in capital</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">22,290</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -8.65pt; padding-left: 25.9pt">Accumulated deficit</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(8,828</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -8.65pt; padding-left: 25.9pt">Accumulated other comprehensive income (loss)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(4</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right"></TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; text-indent: -8.65pt; padding-left: 25.9pt">Non-controlling interest</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(12</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-indent: -8.65pt; padding-left: 8.65pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; text-indent: -8.65pt; padding-left: 17.3pt">Total stockholders&rsquo; equity</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">13,620</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; text-indent: -8.65pt; padding-left: 8.65pt">Total capitalization</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">47,293</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right"></TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>


<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0"></TD><TD STYLE="width: 27pt">(1)</TD><TD STYLE="text-align: justify">The number of shares issued and outstanding and the additional paid-in capital exclude (a) 1,690,358
shares of common stock reserved for issuance upon the exercise of stock options and the settlement of restricted stock units outstanding
under our 2015 Equity Incentive Award Plan, (b) 2,666,666 shares of common stock reserved for issuance upon the exercise of outstanding
warrants (for which cash would need to be remitted to us for exercise), and (c) shares of common stock reserved for issuance under
the underwriters&rsquo; over-allotment option.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_030"></A>Price
Range of Common Stock</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company&rsquo;s
common stock is currently quoted on the OTCQB Marketplace under the symbol &ldquo;AMRH&rdquo;. Prior to May 26, 2015, when we completed
a reverse merger and changed our corporate name from Spatializer Audio Laboratories, Inc., our trading symbol was SPZR. We have
applied to list our common stock on The Nasdaq Capital Market, and expect such listing to occur concurrently with this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following table
sets forth for the periods indicated, the reported high and low closing prices per share for our common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 85%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font: bold 10pt Times New Roman, Times, Serif; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Period</B></P> </TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>High</B></P> </TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Low</B></P> </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-indent: -12pt; padding-left: 12pt">2016:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font: 10pt Times New Roman, Times, Serif; text-align: left; text-indent: -12pt; padding-left: 0.5in">First Quarter</TD><TD STYLE="width: 2%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="width: 11%; font: 10pt Times New Roman, Times, Serif; text-align: right">7.00</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="width: 11%; font: 10pt Times New Roman, Times, Serif; text-align: right">5.00</TD><TD STYLE="width: 1%; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; text-indent: -12pt; padding-left: 0.5in">Second Quarter</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">7.00</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; text-indent: -12pt; padding-left: 0.5in">Third Quarter</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">7.00</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5.00</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; text-indent: -12pt; padding-left: 0.5in">Fourth Quarter</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">7.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">5.00</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-indent: -12pt; padding-left: 12pt">2017:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; text-indent: -12pt; padding-left: 0.5in">First Quarter</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">6.55</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">6.51</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; text-indent: -12pt; padding-left: 0.5in">Second Quarter</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">9.00</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">6.51</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left; text-indent: -12pt; padding-left: 0.5in">Third Quarter (through September __, 2017)</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">9.00</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">$</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right">6.50</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On September __, 2017,
the closing price of our common stock was $___. As of September __, 2017, there were 14,650,412 shares of common stock outstanding,
held of record by 534 holders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_031"></A>Dilution</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If you invest in our
securities, your interest will be immediately and substantially diluted to the extent of the difference between the public offering
price per share of our common stock and the pro forma net tangible book value per share of our common stock after giving effect
to this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our net tangible book
value as of June 30, 2017 was $13,619,866 or $1.01 per share of common stock, based upon 14,650,412 shares outstanding. After giving
effect to the sale of the shares in this offering at the assumed public offering price of $___ per share, at June 30, 2017, after
deducting underwriting discounts and commissions and other estimated offering expenses payable by us, our as adjusted net tangible
book value at June 30, 2017 would have been approximately $______, or $___ per share. This represents an immediate increase in
as adjusted net tangible book value of approximately $___ per share to our existing stockholders, and an immediate dilution of
$___ per share to investors purchasing shares in the offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Dilution in as adjusted
net tangible book value per share represents the difference between the amount per share paid by purchasers of our common stock
in this offering and the as adjusted net tangible book value per share of our common stock immediately after this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following table
illustrates the per share dilution to investors purchasing securities in the offering:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" ALIGN="CENTER" STYLE="border-collapse: collapse; width: 90%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">Assumed public offering price per share</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt">$</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; padding-bottom: 1pt; text-indent: 10pt">Net tangible book value per share as of June 30, 2017</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1.01</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left"></TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right"></TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 10pt">Increase in net tangible book value per share attributable to this offering</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right"></TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">As adjusted net tangible book value per share after this offering</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right"></TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt">Dilution in pro forma net tangible book value per share to new investors</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right"></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The information above
assumes that the underwriters do not exercise their over-allotment option. If the underwriters exercise their over-allotment option
in full, the as adjusted net tangible book value will increase to $__ per share, representing an immediate increase to existing
stockholders of $___ per share and an immediate dilution of $___ per share to new investors. If any shares are issued upon exercise
of outstanding options or warrants, new investors will experience further dilution.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Investors in this offering
will be subject to increased dilution upon the exercise of outstanding stock options, settlement of restricted stock units and
the exercise of warrants. As of Septemnber ___, 2017, these stock options, restricted stock units and warrants represent an additional
6,074,494 shares that could be issued in the future. In addition, conversion of the 2017 Notes and the issuance of shares of our
common stock pursuant to our acquisition agreements will result in further dilution of your investment.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_032"></A>Description
of Business</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Our Company</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We specialize in delivering
SAP cloud, digital and enterprise services to clients worldwide.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">SAP is a leader in
providing enterprise resource planning (&ldquo;ERP&rdquo;) software and technologies to enterprise customers worldwide. We deliver
a wide range of solutions and services across multiple domains and industries. Our services include strategic consulting, operational
leadership, digital transformation services, robotics process automation and co-creation of customized solutions, including those
in mobility, sustainability, big data and cloud computing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our SAP focus allows
us to provide technological solutions to a broad and growing base of clients. We are headquartered in Princeton, NJ, and have offices
across the United States, which are supported by delivery centers in India. Our model inverts the conventional global delivery
model wherein offshore information technology (&ldquo;IT&rdquo;) service providers are based abroad and maintain a minimal presence
in the United States. With a strong SAP focus, our client partnerships anchor around SAP cloud services, artificial intelligence,
internet of things and robotic process automation. We pursue an acquisition strategy that seeks to disrupt the established business
model of offshore IT service providers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">With our innovative
solutions in enterprise architecture, ERP, predictive analytics and enterprise mobility, we provide companies worldwide with strategic
insights into their business which lead to a positive impact on their performance and profitability. In 2017, we signed a strategic
partnership agreement with NEC America to offer SAP HANA (a next generation enterprise database system) migration services. This
partnership will allow us to offer our clients a broader spectrum of services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our primary business
objective is to provide our clients with a competitive advantage by enhancing their business capabilities and technologies with
our expanding consulting services portfolio, which is aided by our business acquisitions. Our strategic acquisitions allow us to
bring global service delivery, SAP S/4 HANA and high-end SAP consulting capabilities to a broader geographic market and customer
base. We continue to leverage our growing geographical footprint and technical expertise to simultaneously expand our service and
product offering. With each acquisition, we identify business synergies that will allow us to bring new services and products from
one subsidiary to customers at our other subsidiaries. While we generate revenues from the consulting businesses of each of our
acquired subsidiaries, we believe that additional revenues will be generated through new business relationships and services developed
through our business combinations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Background</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We were incorporated
under the laws of the State of Delaware in February 1994 as Spatializer Audio Laboratories, Inc., which was a shell company immediately
prior to our completion of a &ldquo;reverse merger&rdquo; transaction on May 26, 2015, <FONT STYLE="background-color: white">in
which we caused Ameri100 Acquisition, Inc., a Delaware corporation and our newly created, wholly owned subsidiary, to be merged
with and into Ameri and Partners, a Delaware corporation. As a result of the Merger, Ameri and Partners became our wholly owned
subsidiary with Ameri and Partners&rsquo; former stockholders acquiring a majority of the outstanding shares of our </FONT>common
stock<FONT STYLE="background-color: white">. The Merger was consummated under Delaware law, pursuant to the Merger Agreement,</FONT>
and in connection with the Merger we changed our name to AMERI Holdings, Inc. and do business under the brand name &ldquo;Ameri100&rdquo;.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white">As
part of the Merger, we purchased 24.9% of the outstanding shares of common stock of </FONT>Ameri Consulting Service Private Ltd.
(&ldquo;<FONT STYLE="background-color: white">Ameri India&rdquo;), a corporation organized under the laws of India which was owned
by Srinidhi &ldquo;Dev&rdquo; Devanur, our Executive Vice Chairman, for aggregate consideration consisting of $1.00 and the consideration
being furnished by us to the stockholders of Ameri and Partners under the Merger Agreement, pursuant to the terms of a Stock Purchase
Agreement, dated as of May 26, 2015, by and between us and Mr. Devanur. Subject to obtaining various regulatory approvals for foreign
ownership required under India&rsquo;s Foreign Exchange Management Act, we agreed to purchase the remaining 75.1% of the outstanding
shares of Ameri India (with the exception of one share of Ameri India that was retained by Mr. Devanur as a nominee holder for
the Company due to a requirement of Indian law for a corporation to have a minimum of two shareholders) for similar consideration,
which transaction was completed in 2016.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white"></FONT>&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white">Concurrently
with the closing of the Merger, we issued </FONT>a 5% Unsecured Convertible Note due May 26, 2017, in the principal amount of $5,000,000
(the &ldquo;Convertible Note&rdquo;) bearing interest at 5% per annum, maturing on May 26, 2017 and at a conversion price of $1.80
per share, or an aggregate of 2,777,778 shares of common stock, together with a warrant to purchase shares of our common stock
(the &ldquo;Original Warrant&rdquo;) to purchase up to 2,777,777 shares of our common stock, at an exercise price equal to $1.80
per share, in a private placement (the &ldquo;Private Placement&rdquo;) to Lone Star Value Investors, LP (&ldquo;LSVI&rdquo;),
pursuant to the terms of a Securities Purchase Agreement<FONT STYLE="background-color: white">, dated as of May 26, 2015. Prior
to the Merger, LSVI was our majority shareholder.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On May 13, 2016, LSVI
completed an early partial exercise of an Original Warrant for 1,111,111 shares the Company&rsquo;s common stock at a price of
$1.80 per share, for total consideration to the Company of $2,000,000, and LSVI was issued a replacement warrant for the remaining
1,166,666 shares under the Original Warrant on the same terms as the Original Warrant. LSVI also agreed to an amendment of the
Convertible Note, to extend the maturity of the Convertible Note for two years in exchange for (i) the right to request that the
Board of Directors of the Company (the &ldquo;Board&rdquo;) expand the size of the Board to nine directors from the current eight,
with LSVI having the right to designate up to four of the nine directors, and (ii) the issuance of an additional warrant (the &ldquo;Additional
Warrant&rdquo;) for the purchase of 1,000,000 shares of the Company&rsquo;s common stock at a price of $6.00 per share, on substantively
the same terms as the Original Warrant. LSVI&rsquo;s Registration Rights Agreement, dated May 26, 2015, with us was also amended
and restated to include the shares of common stock issuable under the Additional Warrant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On December 30, 2016,
the Company entered into an Exchange Agreement (the &ldquo;Exchange Agreement&rdquo;) with LSVI, pursuant to which the Convertible
Note was returned to the Company and cancelled in exchange for 363,611 shares of the Company&rsquo;s Series A Preferred Stock,
which is non-convertible and perpetual preferred stock of the Company. As a result of the exchange transaction, no principal or
interest remained outstanding or payable under the Convertible Note and the Convertible Note was no longer convertible into shares
of common stock of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Our Industry</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Background</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We operate in an intensely
competitive IT outsourcing services industry, which competes on quality, service and costs. Most offshore IT services providers
have undertaken a &ldquo;forward integration&rdquo; to boost their capabilities and presence in their client geographies (large
offshore presence with a small local presence). Large U.S. players on the other hand focus on &ldquo;backward integration&rdquo;
to scale and boost their offshore narrative (offshore being the &ldquo;back office&rdquo; for the local operations). Today the
IT services industry is marked by the following characteristics:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="background-color: #AEAAAA">
    <TD STYLE="width: 14%; border: black 1.5pt solid; text-align: center"><B>Characteristic</B></TD>
    <TD STYLE="vertical-align: top; width: 3%; border-top: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: center">&nbsp;</TD>
    <TD STYLE="width: 83%; border-top: black 1.5pt solid; border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: center"><B>Description&nbsp;</B></TD></TR>
<TR>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">Mature Market</TD>
    <TD STYLE="vertical-align: top; border-bottom: black 1.5pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&#9679;</P></TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Most large global companies have
already outsourced what they wanted to outsource.</P></TD></TR>
<TR>
    <TD ROWSPAN="2" STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; border-left: black 1.5pt solid; background-color: white">Commoditized Business Model</TD>
    <TD STYLE="vertical-align: top; text-align: center">&#9679;</TD>
    <TD STYLE="border-right: black 1.5pt solid; text-align: justify">North America and Europe continue to be the markets with attractive spending potential. However, increased regulations and visa dependencies prove to be a major drawback of the model.</TD></TR>
<TR>
    <TD STYLE="vertical-align: top; border-bottom: black 1.5pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&#9679;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P></TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: justify">The benefits realized from the business model are largely based on labor arbitrage, productivity benefits and portfolio restructuring. These contours have changed due to commoditization.</TD></TR>
<TR>
    <TD STYLE="border-right: Black 1.5pt solid; border-left: Black 1.5pt solid">Insourcing</TD>
    <TD STYLE="vertical-align: top; text-align: center">&#9679;</TD>
    <TD STYLE="vertical-align: top; border-right: Black 1.5pt solid; text-align: justify">Extremely rapid changes in technology are forcing IT services&ndash;traditionally an outsourcing business&mdash;to adopt an insourcing model.</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR>
    <TD ROWSPAN="4" STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; border-left: black 1.5pt solid; background-color: white; width: 14%">Rapid Technology Shifts</TD>
    <TD STYLE="vertical-align: top; text-align: center; width: 3%">&#9679;</TD>
    <TD STYLE="border-right: black 1.5pt solid; text-align: justify; width: 83%">Cloud services, robotic process automation, artificial intelligence and internet of things are increasingly in demand as part of outsourcing engagements. Smart robots increasingly operate in the cloud, and a &lsquo;labor-as-a-service&rsquo; approach has emerged, as clients and providers find that intelligent tools and virtual agents can be easily and flexibly hosted on cloud platforms.</TD></TR>
<TR>
    <TD STYLE="vertical-align: top; text-align: center">&#9679;</TD>
    <TD STYLE="border-right: black 1.5pt solid; text-align: justify">Social media, cloud computing, mobility and big data will continue to be mainstays for any IT ecosystem.</TD></TR>
<TR>
    <TD STYLE="vertical-align: top; text-align: center">&#9679;</TD>
    <TD STYLE="border-right: black 1.5pt solid; text-align: justify">The convergence of cloud computing, virtualization (applications and infrastructure) and utility computing is around the corner. The ability of a vendor to offer an integrated basket of services on a SaaS model, will be a key differentiator.</TD></TR>
<TR>
    <TD STYLE="vertical-align: top; border-bottom: black 1.5pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&#9679;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P></TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: justify">Enterprises are becoming more digital. There is a strong convergence of human and machine intelligence thanks to drivers like advanced sensors and machine learning. Operations and technology are converging.&nbsp;</TD></TR>
<TR>
    <TD ROWSPAN="2" STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; border-left: black 1.5pt solid; background-color: white">Contracts &amp; Decision Making</TD>
    <TD STYLE="vertical-align: top; text-align: center">&#9679;</TD>
    <TD STYLE="border-right: black 1.5pt solid; text-align: justify">Large multi-year contracts will be renegotiated and broken down into shorter duration contracts and will involve multiple vendors rather than sole sourcing.</TD></TR>
<TR>
    <TD STYLE="vertical-align: top; border-bottom: black 1.5pt solid; text-align: center">&#9679;</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: justify">The ability to demonstrate value through Proof of Concepts (POCs) and willingness to offer outcome based pricing are becoming critical considerations for decision making. Requests for Proposal (RFP)-driven decisions are increasingly rare.</TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">The SAP Industry</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">SAP as an ERP product
has become an industry by itself. The core SAP enterprise offering has been reinforced with cloud-based products that make the
entire SAP ecosystem extremely attractive from&nbsp;our&nbsp;perspective&nbsp;due to the following attributes:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">The alignment of SAP to enterprises is extremely strong. Given the reliance of enterprises on applications,
clients tend to make long-term bets on SAP as an enterprise solution.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">According to the September 2014 &ldquo;HfS Blueprint Report&rdquo; by HfS Research Ltd., the SAP
market is a multi-billion-dollar market that is very fragmented (there are over 5,000 consulting firms), with the three largest
service providers capturing an increasing share of the market.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">A significant number of SAP customers must move to S/4 HANA by 2025.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Our Approach</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our solutions deliver
significant business efficiency outcomes through turnkey projects, consulting and global delivery centers. We have adopted a &ldquo;strategic
acquisition model&rdquo;, pursuant to&nbsp;which we acquire companies that support our goals. These businesses are realigned as
parts of a viable and profitable operating model. We believe that our strategic service portfolio, deep industry experience and
strong global talent pool&nbsp;offer&nbsp;a compelling proposition to clients. In 2016, we acquired three companies: Virtuoso and
Ameri Arizona in the U.S., and Bigtech Software Pvt. Ltd. in India. These strategic acquisitions have brought global delivery presence,
SAP S/4 HANA and high-end SAP consulting capabilities to our service portfolio. In 2017, we signed a strategic partnership agreement
with NEC America to offer SAP HANA (a next generation enterprise database system) migration services. This partnership enables
us to offer our clients a broader spectrum of services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Our Portfolio of Service Offerings</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our portfolio of service
offerings expanded significantly in 2016 with our acquisitions of Ameri Georgia, Ameri Arizona, Virtuoso and Bigtech. We anticipate
our future service offerings to evolve as we continue to pursue our acquisitive growth strategy.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our current portfolio
of services is divided into three categories:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Cloud Services</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">An increasing trend
in the IT services market is the adoption of cloud services. Historically clients have resorted to on-premise software solutions,
which required capital investments in infrastructure and data centers. Cloud services enable clients to build and host their applications
at much lower costs. Our product offerings leverage the low cost and flexibility of cloud computing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have expertise in
deploying SAP&rsquo;s public, private and hybrid cloud services, as well as SAP HANA cloud migration services. Our teams are experienced
in the rapid delivery of cloud services. We perform SAP application and cloud support and SAP cloud development. Additionally,
we provide cloud automation solutions that focus on business objectives and organizational growth. We believe that our strategic
partnership with NEC will enable us to offer an attractive HANA migration service to our clients.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Digital Services</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have developed several
mobile solutions, including Simple Advance Planning and Optimization (&ldquo;APO&rdquo;), the IBP/ Sales and Operations Planning
(&ldquo;S&amp;OP&rdquo;) Mobile Analytics App and the Langer Index.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The SimpleAPO mobile
application (app) provides sales professionals with real-time collaboration capabilities and customer data, on their mobile devices.
It increases the efficiency of the sales process and the accuracy of customer needs forecasting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The SAP IBP mobile
app enables the real-time management and analysis of S&amp;OP related data from mobile devices. SAP is an implementation partner
for this app. SAP has recognized the app&rsquo;s value to the ecosystem (S&amp;OP apps being complex and difficult to design).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Langer Index is
a mobile-supported, web-based assessment system for collecting and analyzing IT organizational effectiveness. Most customers do
not have measurement metrics to assess if their IT spend is yielding value. A firm&rsquo;s IT organization could be transactional,
transitional or transformational depending on its investment in technology, processes and personnel. The Langer Index gives us
a novel tool to measure IT maturity and focus and to help our clients ensure that their IT dollars are creating maximal value.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Enterprise Services</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We design, implement
and manage Business Intelligence (&ldquo;BI&rdquo;) and analytics solutions. BI helps our clients navigate the market better by
identifying new trends and by targeting top-selling products. We also enable clients to use BI for generating instant financial
reports and analytics&nbsp;of&nbsp;customer, product and cost information over time. In addition, we provide solutions for metadata
repository, master data management and data quality. Finally, we determine BI demands across various platforms.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Other key enterprise
services that we offer include consulting services for global and regional SAP implementations, SAP/IT solution advisory and architectural
services, project management services, IT/ERP strategy and vendor selection services. Often clients have relied on us to deliver
services in non-SAP packages, as well. We bring deep expertise in products by&nbsp;companies such as&nbsp;Oracle, JD Edwards, PeopleSoft,
MicroStrategy, Hyperion, Siebel and webMethods.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition, the broad
range of experiences of our consultants is brought together to create &ldquo;knowledge products&rdquo; in SAP, and to deliver training
programs on a customized basis for our clients. Thus, we are able to scale competencies within a client&rsquo;s organization by
leveraging our consultant&rsquo;s expertise.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Our Growth Strategy</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our growth strategy
is based on customer-driven business expansion and strategic acquisitions of SAP services companies. We introduce specific key
account management strategies to grow organically by cross selling and upselling different services across business units. It is
our goal to be a leader in the SAP cloud, digital and enterprise services market. We use strategic acquisitions, alliances and
partnerships to achieve this goal.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have complementary
near-and longer-term strategies. In the short-term, we continue to focus on high-end consulting and solutions in the SAP space.
Our medium-term focus will be to make an entry into cloud engagements and HANA. Signing up with NEC as a strategic partner for
the SAP HANA migration was a critical step to achieving this objective. Additionally, we will gain market share in high-growth
areas in the SAP ecosystem such as Hybris, Success Factors and BI/BW/SAP HANA. In the long-term, we will identify and acquire firms
in the areas of Artificial Intelligence (AI) and robotics to bolster our AIR (AI + internet of things + robotics) practice. We
believe that during each phase of our growth strategy, business and market conditions will require&nbsp;our&nbsp;plans to evolve
or change, and we plan to be agile in addressing both&nbsp;opportunities&nbsp;and&nbsp;exigencies.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The integration of
each of our acquisitions into our business enterprise requires establishing our company&rsquo;s standard operating procedures at
each acquired entity, seamlessly transitioning each acquired entity&rsquo;s branding to the &ldquo;Ameri100&rdquo; brand and assessing
any necessity to transition account management. The integration process also requires us to evaluate any product-line expansions
made possible by the acquired entity and how to bring new product lines to the broader customer base of the entire Company. With
the integration of each acquisition, we face challenges of maintaining cross-company visibility and cooperation, creating a cohesive
corporate culture, handling unexpected customer reactions and changes and aligning the interests of the acquired entity&rsquo;s
leadership with the interests of the Company. To date, these challenges have been manageable, and we are becoming more adept at
managing integration issues with each new acquisition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Sales and Marketing</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We combine traditional
sales with our strength in industries and technology. Our sales function is composed of direct sales and inside sales professionals.
Both work closely with our solutions directors to identify potential opportunities within each account.&nbsp;We currently have
85 active clients and 200 dormant accounts. Using a consultative selling methodology (working with clients to prescribe a solution
that suits their needs in terms of efficiency, cost and timelines), we identify target prospects and develop a pursuit plan for
each key account. We utilize a blended sales model that combines consultative selling with traditional sales methods. Once the
customer has engaged us, the sales, solutions and marketing teams monitor and manage the relationship with the help of customer
relationship management software.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The marketing group
is tasked with building a strong, sustainable brand image for our company, positioning us in the SAP arena and facilitating business
opportunities. Marketing functions include webinars, targeted email campaigns and social media vehicles including blogs, networking
efforts and video sharing websites. Data gathered from these activities&nbsp;helps&nbsp;us to measure and track our market position
and customer understanding of our offerings.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Revenues and Customers</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We generate revenue
primarily through consulting services performed in the fulfillment of written service contracts. The service contracts we enter
into generally fall into two categories: (1) time-and-materials contracts and (2) fixed-price contracts.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">When a customer enters
into a time-and-materials or fixed-price, (or a periodic retainer-based) contract, we recognize revenue in accordance with&nbsp;an&nbsp;evaluation
of the deliverables in each contract. If the deliverables represent separate units of accounting, we then measure and allocate
the consideration from the arrangement to the separate units, based on vendor-specific objective evidence of the value for each
deliverable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The revenue under time-and-materials
contracts is recognized as services are rendered and performed at contractually agreed upon rates. Revenue pursuant to fixed-price
contracts is recognized under the proportional performance method of accounting. We routinely evaluate whether revenue and profitability
should be recognized in the current period. We estimate the proportional performance on our fixed-price contracts on a monthly
basis utilizing hours incurred to date as a percentage of total estimated hours to complete the project.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">For the twelve months
ended December 31, 2016, sales to five major customers accounted for 52.75% of our total revenue.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Technology Research and Development</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We regard our services
and solutions and related software products as proprietary. We rely primarily on a combination of copyright, trademark and trade
secret laws of general applicability, employee confidentiality and invention assignment agreements, distribution and software protection
agreements and other intellectual property protection methods to safeguard our technology and software products. We have not applied
for patents on any of our technology. We also rely upon our efforts to design and produce new applications and upon improvements
to existing software products to maintain a competitive position in the marketplace.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On December 26, 2015,
we entered into a license agreement with Dr. Arthur M. Langer, which grants us a license for exclusive, perpetual, irrevocable
and worldwide use of the Langer Model to generate the Langer Index.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Research and product
development expenditures were approximately $54,945 for the twelve months ended December 31, 2016 and $524,741 for twelve months
ended December 31, 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Strategic Alliances</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Through our Lean Enterprise
Architecture Partnership (&ldquo;LEAP&rdquo;) methodology, we have strategic alliances with technology specialists who perform
services on an as-needed&nbsp;basis for clients. We partner with niche specialty firms globally to obtain&nbsp;specialized&nbsp;resources
to meet client needs.&nbsp;Our business partners include executive recruiters, staffing firms and niche technology companies. The
terms of each strategic alliance arrangement depend on the nature of the particular partnership. Such alliance arrangements typically
set forth deliverables, scope of the services to be delivered, costs of services and terms and conditions of payment (generally
45 to 90 days for payment to be made). Each alliance arrangement also typically includes terms for indemnification of our company,
non-solicitation of each partner&rsquo;s employees by the other partner and dispute resolution by arbitration.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Alliances and partnerships
broaden our offerings and&nbsp;make us&nbsp;a one-stop solution for clients. Our team constantly produces services that complement
our portfolio and build strategic partnerships. Our partner companies range from RPA product companies, to digital marketing strategy
consulting firms, to large infrastructure players.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On any given project
we evaluate a client&rsquo;s needs and make our best effort to meet them with our full-time specialists. However, in certain circumstances,
we may need to go outside the Company, and in this case we approach our strategic partners to tap into their pools of technology
specialists. Project teams are usually composed of a mix of our full time employees and outside technology specialists. Occasionally,
a project team may consist of a Company manager and a few outside technology specialists. While final accountability for any of
our projects rests with the Company, the outside technology specialists are incentivized to successfully complete a project with
project completion payments that are in addition to hourly billing rates we pay the outside technology specialists.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Competition</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The large number of
competitors and the speed of technology change make IT services and outsourcing a challenging business. Competitors in this market
include systems integration firms, contract programming companies, application software companies, traditional large consulting
firms, professional services groups of computer equipment companies and facilities management and outsourcing companies. Examples
of our competitors in the IT services industry include Accenture PLC, Cartesian Inc., Cognizant Technology Solutions Corporation,
Hexaware Technologies Limited, Infosys Technologies Limited, Mindtree Limited, RCM Technologies Inc., Tata Consultancy Services
Limited, Virtusa Corporation and Wipro Limited.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We believe that the
principal factors for success in the IT services and outsourcing market include performance and reliability; quality of technical
support, training and services; responsiveness to customer needs; reputation and experience; financial stability and strong corporate
governance; and competitive pricing.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Some of our competitors
have significantly greater financial, technical and marketing resources and/or greater name recognition, but we believe we are
well positioned to capitalize on the following competitive strengths to achieve future growth:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">well-developed recruiting, training and retention model;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">successful service delivery model;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">broad referral base;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">continual investment in process improvement and knowledge capture;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">investment in research and development;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">strong corporate governance; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">custom strategic partnerships to provide breadth and depth of services.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Employees</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As of July 31, 2017,
we employed approximately 275 employees in 11 locations in the United States, Canada and India. We routinely supplement our employee
consulting staff with subcontractors,&nbsp;which totaled&nbsp;175 at July 31, 2017, most of which&nbsp;were&nbsp;from other services
firms. Between&nbsp;our&nbsp;employees and subcontractors, we had 350 billable consultants at July 31, 2017. Our employees are
not part of a collective bargaining arrangement and we believe&nbsp;our&nbsp;relations&nbsp;with our employees&nbsp;are&nbsp;good.
We have employment agreements with our executive officers and certain other employees.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Properties</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our principal executive
office is located in approximately 2,547 square feet of office space in Princeton, New Jersey and is situated within an office
that also serves as the principal office of Ameri and Partners. We currently pay rent of $5,400 per month for our principal office.
We also lease administrative, marketing and product development and support facilities totaling approximately 14,000 square feet
in Atlanta, Georgia; Leawood, Kansas; Folsom, California and Chandler, Arizona in the U.S. and Chennai, Mumbai and Bangalore, India.
Most of our lease commitments end by 2020.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Legal Proceedings</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We are not currently
a party to any pending legal proceeding, nor is our property the subject of a pending legal proceeding, that is not in the ordinary
course of business or otherwise material to the financial condition of our business.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_039"></A>Management&rsquo;s
Discussion and Analysis of Financial Condition and Results of Operations</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>The following discussion
and analysis of financial condition and results of operations of Ameri Holdings, Inc. should be read in conjunction with the financial
statements and related notes appearing elsewhere in this prospectus. Our actual results may not be indicative of future performance.
This discussion and analysis contains forward-looking statements and involves numerous risks and uncertainties, including, but
not limited to, those discussed in &ldquo;Cautionary Note Regarding Forward-Looking Statements&rdquo; and &ldquo;Risk Factors.&rdquo;
Actual results may differ materially from those contained in any forward-looking statements. </I></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Company Overview</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We were incorporated
under the laws of the State of Delaware in February 1994 as Spatializer Audio Laboratories, Inc., which had been a shell company
until May of 2015. On May 26, 2015, we completed a &ldquo;reverse merger&rdquo; transaction, in which we caused Ameri100 Acquisition,
Inc., a Delaware corporation as our newly created, wholly owned subsidiary, to be merged with and into Ameri and Partners (doing
business as Ameri100), a Delaware corporation. As a result of the Merger, Ameri and Partners became our wholly owned subsidiary
with Ameri and Partners&rsquo; former stockholders acquiring a majority of the outstanding shares of our common stock. <FONT STYLE="background-color: white">The
Merger was consummated under Delaware law, pursuant to the Merger Agreement, and in connection with the Merger we changed our name
to AMERI Holdings, Inc.</FONT> Since the Merger, we have been an active holding company headquartered in Princeton, New Jersey,
with offices across the United States that are supported by offices in India.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We specialize in delivering
SAP cloud, digital and enterprise services to clients worldwide. Our SAP focus allows us to provide technological solutions to
a broad and growing base of clients. Our model inverts the conventional global delivery model wherein offshore IT service providers
are based abroad and maintain a minimal presence in the United States. With a strong SAP focus, our client partnerships anchor
around SAP cloud services, artificial intelligence, internet of things and robotic process automation. We pursue an acquisition
strategy that seeks to disrupt the established business model of offshore IT service providers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We generate revenue
by providing consulting services under written service contracts with our customers. The service contracts we enter into generally
fall into two categories: (1) time-and-materials contracts and (2) fixed-price contracts.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">When a customer enters
into a time-and-materials or fixed-price (or a periodic retainer-based) contract, the revenue is recognized in accordance with
the deliverables of each contract. If the deliverables involve separate units of accounting, the consideration from the arrangement
is measured and allocated to the separate units, based on vendor specific objective evidence of the value for each deliverable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The revenue under time
and materials contracts is recognized as services are rendered and performed at contractually agreed upon rates. Revenue pursuant
to fixed-price contracts is recognized under the proportional performance method of accounting. We routinely evaluate whether revenue
and profitability should be recognized in the current period. We estimate the proportional performance on fixed-price contracts
on a monthly basis utilizing hours incurred to date as a percentage of total estimated hours to complete the project.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">For the twelve months
ended December 31, 2016, sales to five major customers, accounted for 52.75% of our total revenue.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We continue to explore
strategic alternatives to improve the market position and profitability of our product and service offerings in the marketplace,
generate additional liquidity for the Company, and enhance our valuation. We plan to pursue our goals during the next twelve months
principally through organic growth and through other strategic alternatives. Some of these alternatives have included, and could
continue to include, selective acquisitions. The Company has obtained financing and additional capital from the sale of equity
and incurrence of indebtedness in the past, and continues to consider capital raising and financing from the sale of various types
of equity and incurrence of indebtedness to provide capital for our business plans and operations in the future. The Company has
also provided, and may from time to time in the future provide, information to interested parties.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Matters that May or Are Currently Affecting Our Business</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The main challenges
and trends that could affect or are affecting our financial results include:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Our ability to enter into additional technology-management and consulting agreements, to diversify
our client base and to expand the geographic areas we serve;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Our ability to attract competent, skilled professionals and on-demand technology partners for our
operations at acceptable prices to manage our overhead;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Our ability to acquire other technology services companies and integrate them with our existing
business;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Our ability to raise additional equity capital, if and when we needed;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">We may incur an impairment of the goodwill acquired from our prior business acquisitions if our
acquired entities do not experience growth;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Our ability to control our costs of operation as we expand our organization and capabilities.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Result of Operations</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Results
of Operations for the Three Months Ended June 30, 2017 Compared to the Three Months Ended June 30, 2016 and for the Six Months
Ended June 30, 2017 Compared to the Six Months Ended June 30, 2016</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Three Months</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ended</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30, 2017</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Three Months</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ended</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30, 2016</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Six Months</B>&nbsp;</P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ended</B>&nbsp;</P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30, 2017</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Six Months</B>&nbsp;</P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ended</B>&nbsp;</P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30, 2016</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 40%; font-size: 10pt">Revenue</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">12,268,259</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">6,686,938</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">24,609,186</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">13,699,902</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">Cost of revenue</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">9,935,468</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,169,538</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">18,975,045</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">10,926,845</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Gross profit</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">2,332,791</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">1,517,400</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">5,634,141</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">2,773,057</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Operating expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Selling and marketing</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">434,895</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">135,329</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">767,205</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">166,679</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">General and administration</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,405,377</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,977,510</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">7,106,522</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,696,100</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Acquisition related expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">175,136</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">239,815</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">384,480</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">615,220</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Depreciation and amortization</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">825,657</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">101,385</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,514,757</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">213,013</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Operating expenses</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">5,841,065</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">2,454,039</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">9,772,964</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">4,691,012</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Operating income (loss)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,508,274</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(936,639</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(4,138,823</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,917,955</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Interest expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(164,343</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(270,514</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(255,149</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(384,260</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Changes in estimates</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">400,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">400,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Other expense &ndash; net</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8,624</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1,862</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,475</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,161</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Income (loss) before income taxes</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,263,993</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,209,015</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,989,497</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,304,376</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Tax benefit / (provision)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Income after income taxes</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,263,993</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,209,015</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,989,497</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,304,376</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Net income attributable to non-controlling interest</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(15,388</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(11,872</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net income (loss) attributable to the Company</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,279,381</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,209,015</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(4,001,369</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,304,376</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Dividend on preferred stock</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(504,826</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,004,791</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net loss attributable to common stock holders</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,784,207</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,209,015</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(5,006,160</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,304,376</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Other comprehensive income (loss), net of tax</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Foreign exchange translation</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,185</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,808</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,150</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(65,698</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Comprehensive income/(loss)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,786,392</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,211,823</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(5,003,010</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,370,074</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Comprehensive income/(loss) attributable to the Company</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,771,004</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,211,823</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(4,991,138</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,370,074</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt">Comprehensive income/(loss) attributable to the non-controlling interest</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">(15,388</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">(11,872</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">(3,786,392</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">(1,211,823</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">(5,003,010</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">(2,370,074</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">Basic income (loss) per share</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.26</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.09</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.35</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.19</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Diluted income (loss) per share</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.26</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.09</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.35</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.19</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Basic weighted average number of common shares outstanding</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14,610,609</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">12,845,057</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14,352,573</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">12,359,709</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">Diluted weighted average number of common shares outstanding</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14,610,609</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">12,845,057</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14,352,573</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">12,359,709</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>


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<P STYLE="margin-top: 0; margin-bottom: 0"></P>

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<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Revenues</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Revenues
for the three months ended June 30, 2017 increased by approximately $5.58 million as compared to the three months ended June 30,
2016.&nbsp; This increase was primarily attributable to our acquisition of Ameri California, Ameri Arizona and Bigtech. For changes
in revenue by entity please refer to the table below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>Revenues by
subsidiary of the Company</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>(in millions
of U.S. dollars)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; background-color: white; border-collapse: collapse; font-size: 10pt">
<TR>
    <TD STYLE="width: 1%; border-top: black 1.5pt solid; border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="width: 23%; border-top: black 1.5pt solid; border-right: black 1.5pt solid; border-bottom: black 1.5pt solid"></TD>
    <TD STYLE="width: 23%; border-top: black 1.5pt solid; border-bottom: black 1.5pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>Three Months Ended</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>June 30, 2017</B></P></TD>
    <TD STYLE="width: 1%; border-top: black 1.5pt solid; border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="width: 23%; border-top: black 1.5pt solid; border-bottom: black 1.5pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>Three Months Ended</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>June 30, 2016</B></P></TD>
    <TD STYLE="width: 1%; border-top: black 1.5pt solid; border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="width: 27%; border-top: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: right"><B>Increase (Decrease)</B></TD>
    <TD STYLE="width: 1%; border-top: black 1.5pt solid; border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: right">&nbsp;</TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">Ameri &amp; Partners</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">1.48</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;1.80</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">(0.32)</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: right">&nbsp;</TD></TR>
<TR>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">Ameri Georgia</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">4.73</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">4.89</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">(0.16)</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: right">&nbsp;</TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">Bigtech</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">0.29</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;-</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;&nbsp;0.29</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: right">&nbsp;</TD></TR>
<TR>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">Ameri Arizona</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">3.20</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">-</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;&nbsp;3.20</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: right">&nbsp;</TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">Ameri California</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;2.56</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;&nbsp;-</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">2.56</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: right">&nbsp;</TD></TR>
<TR>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid"><B>Total</B></TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right"><B>&nbsp;12.27</B></TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right"><B>&nbsp;6.69</B></TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right"><B>&nbsp;5.58</B></TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: right">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Revenues
for the six months ended June 30, 2017 increased by approximately $10.91 million as compared to the six months ended June 30, 2016.
This increase was primarily attributable to our acquisition of Ameri California, Ameri Georgia and Bigtech. For changes in revenue
by entity please refer to the table below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; background-color: white; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD COLSPAN="7">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Revenues by subsidiary of the
Company</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>(in millions of U.S. dollars)</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P></TD></TR>
<TR>
    <TD STYLE="width: 1%; border-top: black 1.5pt solid; border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="width: 23%; border-top: black 1.5pt solid; border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="width: 23%; border-top: black 1.5pt solid; border-bottom: black 1.5pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>Six Months Ended</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>June 30, 2017</B></P></TD>
    <TD STYLE="width: 1%; border-top: black 1.5pt solid; border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="width: 23%; border-top: black 1.5pt solid; border-bottom: black 1.5pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>Six Months Ended</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><B>June 30, 2016</B></P></TD>
    <TD STYLE="width: 1%; border-top: black 1.5pt solid; border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="width: 27%; border-top: black 1.5pt solid; border-bottom: black 1.5pt solid; text-align: right"><B>Increase (Decrease)</B></TD>
    <TD STYLE="width: 1%; border-top: black 1.5pt solid; border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">Ameri &amp; Partners</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;&nbsp;3.38</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">3.46</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;(0.09)</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD></TR>
<TR>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">Ameri Georgia</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;10.17</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;10.24</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;(0.07)</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">Bigtech</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">0.51</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;&nbsp;&nbsp;-</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;&nbsp;0.51</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD></TR>
<TR>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">Ameri Arizona</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;7.03</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;&nbsp;-</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">7.03</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">Ameri California</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;3.52</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;-</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.52</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD></TR>
<TR>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid"><B>Total</B></TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right"><B>&nbsp;24.61</B></TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right"><B>&nbsp;13.70</B></TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right"><B>10.91</B></TD>
    <TD STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<P STYLE="margin-top: 0; margin-bottom: 0"></P>

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<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Gross Margin</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Our
gross margin was 19% for the three months ended June 30, 2017, as compared to 23% for the three months ended June 30, 2016.&nbsp;
Gross margin from our acquired entities was 23%; without our acquisitions our gross margin was at 15%. The decrease in gross margins
from our existing business was due to higher volume discounts, end of high margin contracts and revenue mix.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Our
gross margin was 23% for the six months ended June 30, 2017, as compared to 20% for the six months ended June 30, 2016. Gross margin
from our acquired entities was 24%; without our acquisitions our gross margin was at 22%.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Our
target gross margins are anticipated to be in the range of 25% to 30% based on the mix of project revenues and professional service
revenues. However, there is no assurance that we will achieve the anticipated gross margins.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Selling
and Marketing Expenses</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Selling
and marketing expenses were $434,895 for the three months ended June 30, 2017, compared to $135,329 for the three months ended
June 30, 2016. The increase in selling and marketing expenses was directly attributable to our acquisition of Ameri Arizona and
Ameri California, which occurred subsequent to the comparable prior period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Selling
and marketing expenses were $767,205 for the six months ended June 30, 2017, compared to $166,679 for the six months ended June
30, 2016. The increase in selling and marketing expenses was directly attributable to our acquisition of Ameri Arizona and Ameri
California, which occurred subsequent to the comparable prior period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>General
and Administration Expenses</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">General
and Administration (&ldquo;G&amp;A&rdquo;) expenses include all costs, including rent costs, which are not directly associated
with revenue-generating activities, as well as the non-cash expense for stock based compensation. These include employee costs,
corporate costs and facilities costs. Employee costs include administrative salaries and related employee benefits, travel, recruiting
and training costs. Corporate costs include reorganization costs, legal, accounting and outside consulting fees. Facility costs
primarily include rent and communications costs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">G&amp;A
expenses for the three months ended June 30, 2017 were $4,405,377 as compared to $1,977,510 for the three months ended June 30,
2016.&nbsp; G&amp;A expenses increased by $2,427,867, of which $1,562,526 was attributable to our stock based compensation expense
due to grants made to our employees and accelerated expenses upon cancellation of restricted stock units. Ameri California, Ameri
Arizona and Bigtech added an additional $1,018,717 to our G&amp;A expenses for the three months ended June 30, 2017 as compared
to the same period in 2016.&nbsp; Our G&amp;A expenses for the three months ended June 30, 2017 excluding these acquisitions increased
due to our continued fund-raising activity and preparation of a Nasdaq listing application.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">G&amp;A
expenses for the six months ended June 30, 2017 were $7,106,522 as compared to $3,696,100 for the six months ended June 30, 2016.&nbsp;
G&amp;A expenses increased by $3,410,422, of which $2,027,276 was attributable to our stock based compensation expense due to grants
made to our employees and accelerated expenses upon cancellation of restricted stock units. Ameri California, Ameri Arizona and
Bigtech added an additional $1,736,843 to our G&amp;A expenses for the six months ended June 30, 2017 as compared to the same period
in 2016. The decrease in G&amp;A expenses during the six months ended June 30, 2017 was attributable to the cost synergies we achieved
with our previous acquisitions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Depreciation
and Amortization</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Depreciation
and amortization expense amounted to $825,657 for the three months ended June 30, 2017, as compared to $101,385 for the three months
ended June 30, 2016. We capitalized the customer lists acquired during various acquisitions, resulting in increased amortization
costs. The customer lists from each acquisition are amortized over a period of 60 months.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Depreciation
and amortization expense amounted to $1,514,757 for the six months ended June 30, 2017, as compared to $213,013 for the six months
ended June 30, 2016. We capitalized the customer lists acquired during various acquisitions, resulting in increased amortization
costs. The customer lists from each acquisition are amortized over a period of 60 months.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Operating
Income (Loss)</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Our
operating income (loss) was ($3,508,274) for the three months ended June 30, 2017, as compared to ($936,639) for the three months
ended June 30, 2016. This increase in loss was mainly due to the increase in G&amp;A expenses of our acquired entities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Our
operating income (loss) was ($4,138,823) for the six months ended June 30, 2017, as compared to ($1,917,955) for the six months
ended June 30, 2016. This increase in loss was mainly due to the increase in G&amp;A expenses of our acquired entities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Interest
Expense</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Our
interest expense for the three months ended June 30, 2017 was $164,343 as compared to $270,514 for the three months ended June
30, 2016. The decrease is mainly due to changes in interest rates charged by our lenders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Our
interest expense for the six months ended June 30, 2017 was $255,149 as compared to $384,260 for the six months ended June 30,
2016. The decrease is mainly due to changes in interest rates charged by our lenders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Changes
in Estimates</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Based
on our current estimates of consideration payable under the Ameri Arizona purchase agreement, we do not believe Ameri Arizona will
achieve its 2017 earn-out and we have adjusted the consideration payable in connection therewith by reducing the estimates by $400,000
and reflecting the adjustment in our income statement for the quarter ended June 30, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Income taxes</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Our
provision for income taxes for the three months ended June 30, 2017 and the three months period ended June 30, 2016 was $0 for
each period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">Our
provision for income taxes for the six months ended June 30, 2017 and the six months period ended June 30, 2016 was $0 for each
period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Acquisition
Related Expenses</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">We
had acquisition related expenditures of $384,480 and $615,220 during the six months ended June 30, 2017 and June 30, 2016, respectively.
These expenses included acquisition costs and legal, banking and other acquisition related fees incurred in connection with our
acquisitions. The decrease is due to the decline in acquisition related activities in the six months ended June 30, 2017 as compared
to the six months ended June 30, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Results of Operations for the Twelve Months Ended
December 31, 2016 Compared to the Twelve Months Ended December 31, 2015</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Twelve
Months</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ended</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December
31,</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; font-weight: bold; text-align: left">Net revenue</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">36,145,589</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">20,261,172</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">Cost of revenue</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">29,608,932</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">13,391,504</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Gross&nbsp;profit</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">6,536,657</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">6,869,668</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Operating expenses:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Selling and marketing</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">417,249</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">119,847</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">General and&nbsp;administration</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,552,966</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,721,633</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Acquisition related expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,585,136</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,655,962</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Depreciation and amortization</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,361,169</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">166,208</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Operating expenses</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">11,916,520</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">7,663,650</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Operating income (loss):</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(5,379,863</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(793,982</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Interest expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(751,074</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(238,471</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Interest income/other income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">89,918</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Other income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">16,604</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Change due to estimate correction</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(410,817</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Total other income (expenses)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(1,145,287</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(148,553</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net income (loss) before income taxes</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(6,525,150</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(942,535</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Income tax benefit (provision)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,747,846</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">128,460</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net income (loss)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,777,304</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(814,075</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;&nbsp;&nbsp;Non-controlling interest</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,382</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Net income (loss) attributable to the Company</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(2,780,686</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(814,075</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Foreign exchange translation adjustment</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(7,426</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Comprehensive&nbsp;income (loss)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(2,788,112</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(814,075</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Revenues</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Revenues for the twelve
months ended December 31, 2016 increased by 78% from the twelve months ended December 31, 2015 to $36,145,589. As shown in the
table below, a significant part of the increase in the revenue came from the businesses we acquired in 2016 and also from our acquisition
of Ameri Georgia, which was completed in November 2015. Our 2016 revenues include a full year of revenue for Ameri Georgia, whereas
our 2015 revenues only included Ameri Georgia&rsquo;s revenue for a portion of 2015. Revenue from our wholly owned subsidiary Ameri
and Partners decreased by $4.8 million in 2016, as compared to 2015, due to the completion of a significant project in 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" ALIGN="CENTER" STYLE="width: 90%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP COLSPAN="4">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Revenues by subsidiary of the
Company</B>&nbsp;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>(in millions of U.S. dollars)</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="width: 23%; border: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="width: 24%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>2016</B></TD>
    <TD NOWRAP STYLE="width: 18%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>2015</B></TD>
    <TD NOWRAP STYLE="width: 35%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>Increase (Decrease)</B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">Ameri and Partners</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.9 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.7 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4.8) </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">Ameri Georgia</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.9 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.6 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.4 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">Virtuoso</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">Ameri Arizona</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.7 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.7 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">Bigtech</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.5 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.5 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid"><B>Total</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;36.1 </B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.3 </B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.9 </B></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our top five customers
accounted for 52.75 % of our revenues for the twelve months ended December&nbsp;31, 2016. We derived 98% of our revenues from our
customers located in North America for the twelve months ended December 31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Gross Margin</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our gross margin was
$6,536,657, or 18.1%, for the twelve months ended December 31, 2016, as compared to $6,869,668, or 33.9%, for the twelve months
ended December 31, 2015. The change in gross margin for 2016 was a result of lower margins for professional services and a decrease
in project revenues in 2016 than in 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In 2015, the company
executed a large transformational project for one key customer, which yielded significant gross margins. That project ended in
early 2016, resulting in gross margins for 2015 that were higher than our gross margins for 2016. In addition, the acquisition
of businesses that operate on the professional services revenue model, which tends to have lower margins than the project-based
revenues model, lowered our overall gross margin. We intend to change the business models of our acquired businesses to a project-based
revenue model as we integrate each acquisition into our business; however, lower margins may continue to impact our results until
all acquisitions have been fully converted to the project-based revenue model.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Selling and Marketing Expenses</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Selling and marketing
expenses were $417,249 for the twelve months ended December 31, 2016, compared to $119,847 for the twelve months ended December
31, 2015. The increase in selling and marketing expenses was directly attributable to the addition of Ameri Georgia&rsquo;s selling
and marketing expenses in 2016, following its acquisition in late 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">General and&nbsp;Administration&nbsp;Expenses</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">G&amp;A expenses include
all costs, including rent costs, which are not directly associated with revenue-generating activities, as well as the non-cash
expense for stock based compensation. These include employee costs, corporate costs and facilities costs. Employee costs include
administrative salaries and related employee benefits, travel, recruiting and training costs. Corporate costs include reorganization
costs, legal, accounting and outside consulting fees. Facilities costs primarily include rent and communications costs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">G&amp;A expenses for
the twelve months ended December&nbsp;31, 2016 was $8,552,966 as compared to $5,721,633 for the year ended December 31, 2015. Our
consolidated G&amp;A expenses increased due to the addition of G&amp;A expenses of our Ameri Georgia, Ameri Arizona, Virtuoso and
Bigtech subsidiaries in 2016, which added $2,653,441, $1,217,865, $445,375 and $139,497, respectively, to our total G&amp;A expenses,
and there were not comparable subsidiary G&amp;A expenses in 2015. Our aggregate G&amp;A expenses for 2016 also includes $1,450,000
in expense for stock based compensation paid in connection with our acquisitions. The overall growth in G&amp;A expenses was moderated
by cost synergies, including consolidating global teams for finance, recruitment and human resources.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Acquisition Related Expenses</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Acquisition related
expenses of $1,585,136 were incurred during the twelve months ended December 31, 2016. These expenses included acquisition costs
and legal, banking and other acquisition related fees incurred in connection with our acquisitions. Increased legal costs were
incurred as a result of various acquisition related activities as well as the additional incremental costs or pursuing additional
acquisitions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our acquisitions related
expenses consisted of the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">$53,288 for an event in connection with integrating all acquired subsidiaries with the Company;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">$229,440 for fees in connection with terminating our prior credit facility and replacing it with
our current credit facility with Sterling National Bank;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">$312,500 for payments to a financial advisor for its assistance in obtaining our current credit
facility with Sterling National Bank;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">$349,902 for earn-out payments to the former owners of Ameri Georgia; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">$640,006 for legal fees in connection with our acquisitions.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">All of the foregoing
expenses were specific to events of the Company that occurred in 2016 and we do not expect further ongoing expenses with those
events.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Depreciation and Amortization</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Depreciation and amortization
expense amounted to $1,361,169 for the twelve months ended December&nbsp;31, 2016, as compared to $166,208 for the twelve months
ended December 31, 2015. We capitalized the customer lists received from each of our acquisitions during 2016, resulting in increased
amortization costs. The customer lists from each acquisition are amortized over a period of 60 months.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our amortization schedule
is as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="2" STYLE="font: bold 10pt Times New Roman, Times, Serif; text-align: left"><U>Years ending December 31,</U></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Amount</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 80%; font-size: 10pt; text-align: left">2017</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 15%; font-size: 10pt; text-align: right">2,464,184</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">2018</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,115,592</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">2019</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,748,250</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">2020</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,621,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">2021</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">815,678</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left"><B>Total</B></TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">8,764,704</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Operating income</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our operating income
percentage was (14.9) % for the twelve months ended December&nbsp;31, 2016, as compared to (3.9) % for the twelve months ended
December 31, 2015. This change was mainly due to an increase in selling and marketing, G&amp;A expenses and acquisition related
expenses.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Income taxes</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our benefit for income
taxes for the twelve months ended December 31, 2016 and the twelve months ended December 31, 2015 amounted to approximately $3,747,846
and $128,460, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B>Liquidity and
Capital Resources </B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our cash position was
$1,041,133 as of June 30, 2017, as compared to $1,379,887 as of December 31, 2016, a decrease of $338,754 primarily due to use
of fund towards working capital and earn-out payments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Cash used for operating
activities was $1,700,989 during the six months ended June 30, 2017 and was primarily a result of net changes in working capital
requirements. Cash used in investing activities was $702,511 during the six months ended June 30, 2017. Cash provided by financing
activities was $2,064,746 during the six months ended June 30, 2017 and was attributable to the increased borrowing under our line
of credit with Sterling National Bank and the issuance of convertible notes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Due to our current
constraints in working capital, we have been unable to pay a few vendors and as a result some of them have threatened legal action
against us. We are currently working with these vendors to negotiate longer payment terms until we are able to raise more capital;
the Company is trying to mitigate these efforts by raising more capital and through streamlining its operations which will provide
cash savings going forward, however there can be no assurance that the Company will be able to secure additional sources of capital.
In case we are unable to pay these vendors, they can take legal action against us or stop doing business with us which may have
an impact on our revenue.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On July 1, 2016, the
Company entered into Loan and Security Agreement (the &ldquo;Loan Agreement&rdquo;), with its wholly-owned subsidiaries Ameri and
Partners Inc and Ameri Georgia, as borrowers (the &ldquo;Borrowers&rdquo;), the Company and its wholly-owned subsidiaries Linear
Logics, Corp. and WinHire Inc serving as guarantors, the Company&rsquo;s Chief Executive Officer, Giri Devanur, serving as a validity
guarantor, and Sterling National Bank, N.A. (as lender and as agent, &ldquo;Sterling&rdquo;). The Company joined Ameri California,
Virtuoso and Ameri Arizona as borrowers under the Loan Agreement following their respective acquisition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Under the Loan Agreement,
the Borrowers can borrow up to an aggregate of $10 million, which includes up to $8 million in principal for revolving loans (the
&ldquo;Revolving Loans&rdquo;) for general working capital purposes, up to $2 million in principal pursuant to a term loan (the
&ldquo;Term Loan&rdquo;) for the purpose of a permitted business acquisition and up to $200,000 for letters of credit. A portion
of the proceeds of the Loan Agreement were also used to repay the November 20, 2015 credit facility that was entered into between
the Company, its wholly-owned subsidiary Ameri Georgia and Federal National Payables, Inc.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The maturity of the
loans under the Loan Agreement are as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Revolving Loan Maturity
Date: July 1, 2019; provided, however, that the Revolving Loan Maturity Date will extend and renew automatically for successive
one-year terms on each anniversary of the initial Revolving Loan Maturity Date (each an &ldquo;Anniversary Date&rdquo;) thereafter,
unless not less than sixty (60) days prior to any such Anniversary Date, written notice of non-renewal is given by either party
to the other, in which case the Revolving Loan Maturity Date will be such next Anniversary Date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Term Loan Maturity
Date: The earliest of (a) the date following acceleration of the Term Loan and/or the Revolving Loans; (b) the Revolving Loan Maturity
Date; or (c) July 1, 2019.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Interest under the
Loan Agreement is payable monthly in arrears and accrues as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(a)</TD><TD STYLE="text-align: justify">in the case of Revolving Loans, a rate per annum equal to the sum of (i) the Wall Street Journal
Prime Rate plus (ii) 2.00%;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(b)</TD><TD STYLE="text-align: justify">in the case of the Term Loan, a rate per annum equal to the sum of (i) the Wall Street Journal
Prime Rate plus (ii) 3.75%; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(c)</TD><TD STYLE="text-align: justify">in the case of other obligations of the Borrowers, a rate per annum equal to the sum of (i) the
greater of (A) 3.25% or (B) Wall Street Journal Prime Rate plus (ii) 3.75%.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Loan Agreement
also requires the payment of certain fees, including, but not limited to letter of credit fees and an unused Revolving Loans fee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Loan Agreement
contains financial and other covenant requirements, including, but not limited to, financial covenants that require the Borrowers
to not permit capital expenditures above $150,000 in any fiscal year, maintain a fixed charge coverage ratio of not less than 2.00
to 1.00 and maintain certain debt to EBITDA ratios. The Loan Agreement also requires the Company and Borrowers to obtain Sterling&rsquo;s
consent before making any permitted acquisitions. The amounts borrowed by the Borrowers under the Loan Agreement are guaranteed
by the guarantors, and the Loan Agreement is secured by substantially all of the Borrowers&rsquo; assets.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The principal amount
of the Term Loan will be repaid as follows: (i) equal consecutive monthly installments in the amount of $33,333.33 each, paid on
the first day of each calendar month and (ii) one final payment of the entire remaining principal balance, together with all accrued
unpaid interest on the Term Loan maturity date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">To date, we are not
in compliance with the financial covenants contained in its Loan Agreement with Sterling National Bank. <FONT STYLE="background-color: white">We
received a waiver from Sterling National Bank for our non-compliance with the Loan Agreement for the quarters ended March 31, 2017
and June 30, 2017 in exchange for the payment of a fee of $5,000 for each quarterly waiver.</FONT> We do not expect to be in compliance
with the terms of the Loan Agreement following the conclusion of the terms of the waivers granted by Sterling National Bank. We
continue to work with Sterling National Bank to address its non-compliance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">If
we are unable to obtain future waivers from Sterling National Bank, the bank could declare our loans with it to be in default and
elect to claim all amounts outstanding to be immediately due and payable and terminate all commitments to extend further credit.
If we are unable to repay the outstanding amounts, Sterling National Bank could proceed against the collateral granted to it to
secure our indebtedness to it. We pledged substantially all of our assets as collateral under the Loan Agreement. The Loan Agreement
is also supported by a limited guaranty from Giri Devanur, our President and Chief Executive Officer. If Sterling National Bank
accelerates the repayment of our loans, there is no assurance that we will have sufficient assets to repay the loans. A default
under the Loan Agreement may also result in an event of default under the 2017 Notes. We are currently looking for additional sources
of financing, however there is no guarantee that we will have additional financing available to us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Interest paid on Term
Loan during the period ended June 30, 2017 amounted to $69,625. Principal repaid on the Term Loan during the period ended June
30, 2017 was $200,000. The short term and long-term outstanding balances on the Term Loan as of June 30, 2017 were $399,996 and
$1,323,470, respectively. The outstanding balance of the Revolving Loans as of June 30, 2017 was $3,794,042.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Bigtech, which was
acquired as of July 1, 2016, had a term loan of $16,283 and a line of credit for $311,412 as of June 30, 2017. The Bigtech line
of credit is with an Indian bank, HDFC Bank Limited, and was entered into on June 3, 2015 for Bigtech&rsquo;s working capital requirements.
The line of credit is for up to $416,667 with an interest rate of 11.85% per annum and maturity in June 2020. The Bigtech term
loan accrues interest at the rate of 10.30% per annum and matures in 2020. Both the term loan and the line of credit were already
in place when the Company acquired Bigtech. Interest paid during the period ended June 30, 2017 amounted to $20,543 for the term
loan and line of credit held by Bigtech.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">For the purpose of
financing the ongoing business and operations of our company, on April 20, 2016, we entered into a Stock Purchase Agreement with
Dhruwa N. Rai, pursuant to which Mr. Rai purchased 500,000 unregistered shares of our common stock, par value $0.01 per share,
from us at a price per share of $6.00 for aggregate consideration to us of $3,000,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On May 13, 2016, LSVI
completed an early partial exercise of its Original Warrant for 1,111,111 shares of our common stock at a price of $1.80 per share,
for total consideration to us of $2,000,000,&nbsp;and LSVI was issued a replacement warrant for the remaining 1,166,666 shares
under the Original Warrant on the same terms as the Original Warrant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On March 7, 2017, we
completed the sale and issuance of the 2017 Notes for aggregate proceeds to us of $1,250,000 from four accredited investors, including
one of the Company&rsquo;s directors, Dhruwa N. Rai. The 2017 Notes were issued pursuant to Securities Purchase Agreements&nbsp;between
the Company and&nbsp;each investor. The 2017 Notes bear interest at 8% per annum until maturity in March 2020, with interest being
paid annually on the first, second and third anniversaries of the issuance of the 2017 Notes beginning in March 2018. From and
after an event of default and for so long as the event of default is continuing, the 2017 Notes will bear default interest at the
rate of 10% per annum. The 2017 Notes can be prepaid by us at any time without penalty.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The 2017 Notes are
convertible into shares of our common stock at a conversion price equal to $______ (equal to 68% of the price per share of the
common stock sold in this offering). Upon the effectiveness of this registration statement, the holders of the 2017 Notes have
the right, at their option, at any time and from time to time to convert, in part or in whole, the outstanding principal amount
and all accrued and unpaid interest under the 2017 Notes into shares of the Company&rsquo;s common stock at the then applicable
conversion price.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The 2017 Notes rank
junior to our secured credit facility with Sterling National Bank. The 2017 Notes also include certain negative covenants including,
without the investors&rsquo; approval, restrictions on dividends and other restricted payments and reclassification of its stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Operating Activities</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our largest source
of operating cash flows is cash collections from our customers for different information technology services we render under various
statements of work. Our primary uses of cash from operating activities are for personnel-related expenses, leased facilities and
taxes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Future Sources of Liquidity</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We expect our primary
source of cash to be positive net cash flows provided by operating activities. We also continue to focus on cost reductions and
have initiated steps to reduce overheads and provide cash savings.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Based on past performance
and current expectations, we expect our existing cash, cash equivalents and short-term investments, and our ongoing cash flows
that are not deemed permanently reinvested, to be sufficient to meet our operating liquidity requirements described above for at
least the 12 months following the date of this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We may raise additional
capital through the private and/or public sale of equity or debt securities, borrowings from financial institutions or third parties
or a combination of the foregoing. Any capital raised will be used to implement our business plan, grow current operations, make
acquisitions or start new vertical businesses.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Off-Balance Sheet Arrangements</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We do not have any
off-balance sheet arrangements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Seasonality</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our operations are
generally not affected by seasonal fluctuations. However, our consultants&rsquo; billable hours are affected by national holidays
and vacation policies, which vary by country.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Climate Change</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We do not believe there
is anything unique to our business which would result in climate change regulations having a disproportional effect on us as compared
to U.S. industry overall.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Impact of Inflation</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We do not believe that
inflation had a significant impact on our results of operations for the periods presented. On an ongoing basis, we attempt to minimize
any effects of inflation on our operating results by controlling operating costs and, whenever possible, seeking to ensure that
billing rates reflect increases in costs due to inflation.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">For all significant
foreign operations, the functional currency is the local currency. Assets and liabilities of these operations are translated at
the exchange rate in effect at each period end. Statements of Operations accounts are translated at the exchange rate prevailing
as of the date of the transaction. The gains or losses resulting from such translation are reported under accumulated other comprehensive
income (loss) as a separate component of equity. Realized gains and losses from foreign currency transactions are included in other
income, net for the periods presented.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Critical Accounting Policies</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B><I>Purchase Price
Allocation.&nbsp;</I></B>We allocate the purchase price of our acquisitions to the assets and liabilities acquired, including identifiable
intangible assets, based on their respective fair values at the date of acquisition. Some of the items, including accounts receivable,
property and equipment, other intangible assets, certain accrued liabilities and other reserves require a degree of management
judgment. Certain estimates may change as additional information becomes available. Goodwill is assigned at the enterprise level
and is deductible for tax purposes for certain types of acquisitions. Management finalizes the purchase price allocation within
the defined measurement period of the acquisition date as certain initial accounting estimates are resolved.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B><I>Valuation of
Contingent Earn-out Consideration.&nbsp;</I></B>Acquisitions may include contingent consideration payments based on the achievement
of certain future financial performance measures of the acquired company. Contingent consideration is required to be recognized
at fair value as of the acquisition date. We estimate the fair value of these liabilities based on financial projections of the
acquired companies and estimated probabilities of achievement. We believe our estimates and assumptions are reasonable, however,
there is significant judgment involved. We evaluate, on a routine, periodic basis, the estimated fair value of the contingent consideration
and changes in estimated fair value, subsequent to the initial fair value estimate at the time of the acquisition, will be reflected
in income or expense in the consolidated statements of operations. Changes in the fair value of contingent consideration obligations
may result from changes in discount periods and rates, changes in the timing and amount of revenue and/or earnings estimates and
changes in probability assumptions with respect to the likelihood of achieving the various earn-out criteria. Any changes in the
estimated fair value of contingent consideration may have a material impact on our operating results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B><I>Revenue Recognition.</I></B>&nbsp;We
recognize revenue in accordance with the Accounting Standard Codification 605 &ldquo;Revenue Recognition.&rdquo; Revenue is recognized
when all of the following criteria are met: (1) persuasive evidence of an arrangement exists, (2) delivery has occurred or services
have been rendered, (3) the seller&rsquo;s price to buyer is fixed and determinable, and (4) collectability is reasonably assured.
We recognize revenue from information technology services as the services are provided. Service revenues are recognized based on
contracted hourly rates, as services are rendered or upon completion of specified contracted services and acceptance by the customer.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B><I>Accounts Receivable.</I></B>&nbsp;We
extend credit to clients based upon management&rsquo;s assessment of their credit-worthiness on an unsecured basis. We provide
an allowance for uncollectible accounts based on historical experience and management evaluation of trend analysis. We include
any balances that are determined to be uncollectible in allowance for doubtful accounts. The allowance for uncollectible accounts
as of December 31, 2016 was $0 and the allowance as of December 31, 2015 was $409,749. Based on the information available, management
believes our accounts receivable, net of allowance for doubtful accounts, are collectible.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.55in; background-color: white"><B><I>Property
and Equipment.</I></B>&nbsp;Property and equipment is stated at cost. We provide for depreciation of property and equipment using
the straight-line method over the estimated useful lives of the related assets ranging from 3 to 7 years. Leasehold improvements
are amortized using the straight-line method over the shorter of the lease terms or the useful lives of the improvements. We charge
repairs and maintenance costs that do not extend the lives of the assets to expenses as incurred.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.55in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We account for computer
software costs developed for internal use in accordance with accounting principles generally accepted in the Unites States, which
require companies to capitalize certain qualifying costs during the application development stage of the related software development
project and to exclude the initial planning phase that determines performance requirements, most data conversion, general and administrative
costs related to payroll and training costs incurred. Whenever a software program is considered operational, we consider the project
to be completed, place it into service and commence amortization of the development cost in the succeeding month.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Recent Accounting Pronouncements</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B><I>New Standards to Be Implemented</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">In
May 2014, the Financial Accounting Standards Board (the &ldquo;FASB&rdquo;) issued Accounting Standards Update (&ldquo;ASU&rdquo;)
2014-09, &ldquo;Revenue from Contracts with Customers (Topic 606),&rdquo; which supersedes the revenue recognition requirements
in &ldquo;Revenue Recognition (Topic 605).&rdquo; This ASU requires an entity to recognize revenue when goods are transferred or
services are provided to customers in an amount that reflects the consideration to which the entity expects to be entitled to in
exchange for those goods or services. This ASU also requires disclosures enabling users of financial statements to understand the
nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In August 2015, the FASB
issued ASU 2015-14, &ldquo;Revenue from Contracts with Customers (Topic 606), deferral of the Effective Date.&rdquo; With the issuance
of ASU 2015-14, the new revenue guidance ASU 2014-09 will be effective for annual periods, and interim periods within those annual
periods, beginning after December 15, 2018, using one of two prescribed retrospective methods. In April 2016, the FASB issued ASU
2016-10, &ldquo;Revenue from Contracts with Customer (Topic 606), Identifying Performance Obligations and Licensing.&rdquo; The
guidance is applicable from the date of applicability of ASU 2014-09. This ASU finalizes the amendments to the guidance on the
new revenue standard on the identification of performance obligations and accounting for licenses of intellectual property. In
December 2016, the FASB issued ASU 2016-20, &ldquo;Technical Corrections and Improvements (Topic 606)&rdquo; which is applicable
from the date of applicability of ASU 2014-09. This guidance provides optional exemptions from the disclosure requirement for remaining
performance obligations for specific situations in which an entity need not estimate variable consideration to recognize revenue.
In May 2016, FASB issued ASU No. 2016-12, &ldquo;Narrow-Scope Improvements and Practical Expedients&rdquo;. This amendment clarified
certain aspects of Topic 606 and will be applicable from the date of applicability of ASU 2014-09. The Company is in process of
evaluating the impact of the foregoing updates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">In
February 2016, the FASB issued ASU No. 2016-02, &ldquo;Leases (Topic 842)&rdquo;. This new standard replaces the existing guidance
on leases and requires the lessee to recognize a right-of-use asset and a lease liability for all leases with lease terms equal
to or greater than twelve months. For finance leases, the lessee would recognize interest expense and amortization of the right-of-use
asset, and for operating leases, the lessee would recognize total lease expense on a straight-line basis. This standard is effective
for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2018. Upon adoption, entities
will be required to use a modified retrospective transition which provides for certain practical expedients. Entities are required
to apply the new standard at the beginning of the earliest comparative period presented. Early adoption of this new standard is
permitted. The Company is currently evaluating the effect this new standard will have on its consolidated financial statements
and related disclosures. The Company does not expect the requirement to recognize a right-of-use asset and a lease liability for
operating leases to have a material impact on the presentation of its consolidated statements of financial position.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">In
August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash
Payments (ASU 2016-15), which clarifies how companies present and classify certain cash receipts and cash payments in the statement
of cash flows. The guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal
years. Based on its current assessment, the Company does not expect the adoption of this update to have a material impact on its
consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">On
November 17, 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which is intended to reduce
diversity in the presentation of restricted cash and restricted cash equivalents in the statement of cash flows. This new standard
requires that restricted cash and restricted cash equivalents be included as components of total cash and cash equivalents as presented
on the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted
cash and restricted cash equivalents in the statement of cash flows. ASU 2016-18 is effective for annual periods beginning after
December 15, 2017 including interim periods within those fiscal years, but earlier adoption is permitted.&nbsp; The Company does
not believe the adoption of this new standard will have a material impact on its consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">In
January 2017, the FASB issued ASU No. 2017-04, simplifying the Test for Goodwill Impairment. Under this new standard, goodwill
impairment would be measured as the amount by which a reporting unit&rsquo;s carrying value exceeds its fair value, not to exceed
the carrying value of goodwill. This ASU eliminates existing guidance that requires an entity to determine goodwill impairment
by calculating the implied fair value of goodwill by hypothetically assigning the fair value of a reporting unit to all of its
assets and liabilities as if that reporting unit had been acquired in a business combination. This update is effective for annual
periods beginning after December 15, 2019, and interim periods within those periods. Early adoption is permitted for interim or
annual goodwill impairment test performed on testing dates after January 1, 2017. The Company is in process of evaluating the impact
of these updates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">In
January 2017, the FASB issued ASU No. 2017-01, clarifying the Definition of a Business, which clarifies and provides a more robust
framework to use in determining when a set of assets and activities is a business. The amendments in this update should be applied
prospectively on or after the effective date. This update is effective for annual periods beginning after December 15, 2017 and
interim periods within those periods. Early adoption is permitted for acquisition or deconsolidation transactions occurring before
the issuance date or effective date and only when the transactions have not been reported in issued or made available for issuance
financial statements. The Company does not believe the adoption of this new standard will have a material impact on its consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Standards
Implemented</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">In
September 2015, the FASB issued ASU No. 2015-16, &ldquo;Simplifying the Accounting for Measurement-Period Adjustments&rdquo;. The
guidance eliminates the requirement that an acquirer in a business combination account for a measurement period adjustment retrospectively.
Instead, an acquirer will recognize a measurement period adjustment during the period in which the amount of the adjustment is
determined. In addition, the portion of the amount recorded in current period earnings by line item that would have been recorded
in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date should
be presented separately on the face of the income statement or disclosed in the notes. This guidance was effective for fiscal years
beginning after December 15, 2015, including interim periods within those fiscal years. This guidance did not have a material impact
on the Company&rsquo;s consolidated financial results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">In
March 2016, the FASB issued ASU No. 2016-09, &ldquo;Compensation &ndash; Stock Compensation&rdquo;. The new guidance changes the
accounting for share based payment transactions, including the income tax consequences, classification of awards as either equity
or liabilities and classification in the Consolidated Statement of Cash Flows. The guidance is effective for annual periods beginning
after December 15, 2016, and interim periods within those annual periods. This guidance did not have a material impact on the Company&rsquo;s
consolidated financial results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_053"></A>Management</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in"><B>Executive Officers
and Directors</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The names and ages
of our executive officers and directors, and their positions with us, are as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="width: 27%; border-bottom: Black 1pt solid"><B>Name</B></TD>
    <TD STYLE="width: 6%; border-bottom: Black 1pt solid"><B>Age</B></TD>
    <TD STYLE="width: 67%; border-bottom: Black 1pt solid"><B>Position</B></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Jeffrey E. Eberwein</TD>
    <TD>47</TD>
    <TD>Chairman of the Board</TD></TR>
<TR STYLE="vertical-align: top; background-color: #CCEEFF">
    <TD>Srinidhi &ldquo;Dev&rdquo; Devanur</TD>
    <TD>52</TD>
    <TD>Executive Vice Chairman of the Board and Director</TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>Giri Devanur</TD>
    <TD>48</TD>
    <TD>President, Chief Executive Officer and Director</TD></TR>
<TR STYLE="vertical-align: top; background-color: #CCEEFF">
    <TD>Viraj Patel</TD>
    <TD>54</TD>
    <TD>Chief Financial Officer</TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>Dimitrios J. Angelis</TD>
    <TD>47</TD>
    <TD>Director</TD></TR>
<TR STYLE="vertical-align: top; background-color: #CCEEFF">
    <TD>Dr. Arthur M. Langer</TD>
    <TD>64</TD>
    <TD>Director</TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>Robert G. Pearse</TD>
    <TD>57</TD>
    <TD>Director</TD></TR>
<TR STYLE="vertical-align: top; background-color: #CCEEFF">
    <TD>Dhruwa N. Rai</TD>
    <TD>48</TD>
    <TD>Director</TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD>Venkatraman Balakrishnan</TD>
    <TD>52</TD>
    <TD>Director</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The principal occupations
for the past five years (and, in some instances, for prior years) of each of our directors and executive officers are as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Jeffrey E. Eberwein</B>
became our Chairman of the Board in May 2015. Mr. Eberwein is a Lone Star Value designee on the Board. He has 25 years of Wall
Street experience and is CEO of Lone Star Value Management, LLC (&ldquo;LSVM&rdquo;), a U.S. registered investment company. Prior
to founding LSVM in January 2013, Mr. Eberwein was a Portfolio Manager at Soros Fund Management from January 2009 to December 2011
and Viking Global Investors from March 2005 to September 2008. Mr. Eberwein serves as Chairman of the board of three other public
companies: Digirad Corporation, a medical imaging Company; ATRM Holdings, Inc., a modular building company; and Hudson Global Inc.,
a global recruitment company. In addition, Mr. Eberwein serves as a director of Novation Companies, Inc., a specialty finance company.
Previously, Mr. Eberwein also served on the Board of Hope for New York, a charitable organization dedicated to serving the poor
in New York City, from 2011 until 2014, where he was the Treasurer and on its Executive Committee. Mr. Eberwein earned an M.B.A.
from The Wharton School, University of Pennsylvania, and a B.B.A. degree with High Honors from The University of Texas at Austin.
The Board believes that Mr. Eberwein&rsquo;s qualifications to serve on the Board include his expertise in finance and experience
in the investment community.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Srinidhi &ldquo;Dev&rdquo;
Devanur </B>became our Executive Vice Chairman and a member of our Board in May 2015. Mr. Devanur founded our operating subsidiary
Ameri and Partners in November 2013 and served as its chairman prior to the Merger. He is a seasoned technology entrepreneur who
has more than 20 years of experience in the IT services industry with a specialization in sales and resource management. He has
built businesses from ground up and has successfully executed acquisitions, mergers and corporate investments. He has managed the
sales function by working closely with various Fortune 500 customers in the United States and India to sell software solutions,
support and staff augmentation related services. Mr. Devanur co-founded Ivega Corporation in 1997, an international niche IT consulting
company with special focus on financial services which merged with TCG in 2004, creating a 1,000+ person focused differentiator
in the IT consulting space. Following this, he founded SaintLife Bio-pharma Pvt. Ltd., which was acquired by a Nasdaq listed company.
Mr. Devanur has a bachelor&rsquo;s degree in electrical engineering from the University of Bangalore, India and has also attended
a Certificate program in Strategic Sales Management at the University of Chicago Booth School of Business. The Board believes that
Mr. Devanur&rsquo;s qualifications to serve on the Board include his background in the IT services industry and his experience
in business development.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Giri Devanur </B>became
our President, Chief Executive Officer and a member of our Board in May 2015. Mr. Devanur served as the President and Chief Executive
Officer of our operating subsidiary Ameri and Partners, since its inception in November 2013. He is a seasoned chief executive
officer who has raised seed capital, venture capital and private equity from global institutions. He has more than 25 years of
experience in the information technology industry. In 2010, he founded WinHire Inc, an innovative company building software products
through technology and human capital management experts and combining them with professional services, and served as its President
and Chief Executive Officer. He co-founded Ivega Corporation in 1997, an international niche IT consulting company with special
focus on financial services which merged with TCG in 2004, creating a 1,000+ person focused differentiator in the IT consulting
space. Giri Devanur has a Master&rsquo;s degree in Technology Management from Columbia University and a bachelor&rsquo;s degree
in computer engineering from the University of Mysore, India. He has attended Executive Education programs at the Massachusetts
Institute of Technology and Harvard Law School. The Board believes that Mr. Devanur&rsquo;s qualifications to serve on the Board
include his substantial experience in the information technology industry and his prior experience as a chief executive officer.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><B>Viraj
Patel</B> became our Chief Financial Officer in April 2017. He is a seasoned finance and operations executive having served as
a Chief Financial Officer of both public and start-up companies. He has over 30 years of experience in the technology, life science
and industrial sectors with significant experience in domestic and international markets, fund-raising and mergers and acquisitions.
From February 2016 to March 2017, Mr. Patel worked as an independent consultant and served as Chief Financial Officer (on a pro
bono basis) for Human Needs Project, a non-governmental organization that provides funding and services to local communities in
Africa. Previously, Mr. Patel served as the Chief Financial Officer of Aqua Metrology Systems, a developer of online and offline
analytical instruments for detection of water contaminants, from August 2015 to January 2016. Prior to that he served as the Chief
Financial Officer of Aspire Public Schools, a leading national K-12 charter schools management organization, from September 2013
to March 2015. From September 2010 to March 2013, Mr. Patel served as the Chief Financial Officer of Imergy Power Systems, a manufacturer
of energy storage solutions. From November 2005 to February 2010, he served as the Chief Financial Officer of public technology
companies, including as UTStarcom, a global telecom infrastructure provider, and prior to that at Avanti Corporation, an electronic
design automation company that was later acquired by Synopsys, Inc. Mr. Patel also served as Vice President of Finance at Nektar
Therapeutics and Chief Accounting Officer at Pall Corporation. Mr. Patel also served as an independent board member and audit committee
chairman for Helios &amp; Matheson (a NASDAQ listed public company in the data and financial analytics sector), from May 2012 through
April 2016 and as a board advisor until July 2016. Mr. Patel began his professional career at PricewaterhouseCoopers in New York
and holds a bachelor&rsquo;s degree in business from Pace University, New York. He is an active Certified Public Accountant in
the State of New York and is a member of the New York State Society of Certified Public Accountants and a member of the American
Institute of Certified Public Accountants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Dimitrios J. Angelis</B>
became a member of our Board in May 2015. Mr. Angelis currently works with the Life Sciences Law Group, providing outside General
Counsel advice to pharmaceutical, medical device and biologics companies. He is also a director of Digirad Inc., a leader in the
field of nuclear gamma cameras for use in cardiology, women&rsquo;s health, pediatric and other imaging and neuropathy diagnostics
applications. Previously, he has served as the Chief Executive Officer of OTI America Inc., the U.S.-based subsidiary of publicly-held
On Track Innovations Ltd., a pioneer of cashless payment technology, since December 2013. His role was to oversee and monetize
the extensive patent portfolio of over 100 U.S. and international patents. Mr. Angelis has served as a director of On Track Innovations
since December 2012, and served as its Chairman of the Board from April 2013 until February 2015. From October 2012 until December
2013, Mr. Angelis served as the General Counsel of Wockhardt Pharmaceuticals Inc., an international biologics and pharmaceutical
company. From October 2008 to October 2012, Mr. Angelis was a senior counsel at Dr. Reddy&rsquo;s Laboratories, Ltd., a publicly-traded
pharmaceutical company, and during 2008 he was the Chief Legal Officer and Corporate Secretary of Osteotech, Inc., a publicly-traded
medical device company, with responsibility for managing the patent portfolio of approximately 42 patents. Prior to that, Mr. Angelis
worked in the pharmaceutical industry in various corporate, strategic and legal roles. In addition, he worked for McKinsey &amp;
Company, Merrill Lynch and the Japanese government more than five years ago. He began his legal career as a transactional associate
with the New York office of the law firm Mayer Brown. Mr. Angelis holds a B.A. degree in Philosophy and English from Boston College,
an M.A. in Behavioral Science and Negotiation from California State University and a J.D. from New York University School of Law.
The Board believes that Mr. Angelis&rsquo; substantial experience as an accomplished attorney, negotiator and general counsel to
public and private companies in the healthcare field will enable him to bring a wealth of strategic, legal and business acumen
to the Board, well qualifying him to serve as a director.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Dr. Arthur M. Langer</B>
became a member of our Board in May 2015. Dr. Langer is the Director of the Center for Technology Management, Vice Chair of Faculty
and Academic Director of the Executive Master of Science in Technology Management Program at the School of Professional Studies
at Columbia University. Dr. Langer serves on the faculty of the Department of Organization and Leadership at the Graduate School
of Education (Teachers College). He is also an elected member of the Columbia University Faculty Senate. Dr. Langer joined the
faculty at Columbia University in 1984. Dr. Langer is the author of Strategic IT: Best Practices for Managers and Executives (2013),
with Lyle Yorks), Guide to Software Development: Designing &amp; Managing the Life Cycle (2012), Information Technology and Organizational
Learning (2011), Analysis and Design of Information Systems (2007), Applied Ecommerce (2002), and The Art of Analysis (1997), and
has numerous published articles and papers relating to service learning for underserved populations, IT organizational integration,
mentoring and staff development. Dr. Langer consults with corporations and universities on information technology, staff development,
management transformation and curriculum development around the globe. Dr. Langer is also the Chairman and Founder of Workforce
Opportunity Services, a non-profit social venture that provides scholarships and careers to underserved populations around the
world. Prior to joining the faculty at Columbia University, Dr. Langer was Executive Director of Computer Support Services at Coopers
&amp; Lybrand, General Manager and Partner of Software Plus, and President of Macco Software more than five years ago. Dr. Langer
holds a B.A. in Computer Science, an M.B.A. in Accounting/Finance, and a Doctorate of Education from Columbia University. The Board
believes Dr. Langer&rsquo;s qualifications to serve on the Board include his expertise in technology management and his vast experience
within the information technology industry.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Robert G. Pearse
</B>became a member of our Board in May 2015. Mr. Pearse is a Lone Star Value designee on the Board. Mr. Pearse has served as a
Managing Partner at Yucatan Rock Ventures, where he specializes in technology investments and consulting, since August 2012. Mr.
Pearse has served as Chairman of the Board of Directors of Crossroads Systems, Inc. since May 2016, also serving as the Chairman
of its Compensation Committee and as a member of its Audit Committee and Nomination and Governance Committee since July 2013. Mr.
Pearse serves as a director for Novation Companies, Inc., also serving as the Chairman of its Compensation Committee and as a member
of its Audit Committee since January 2015. Previously, Mr. Pearse served as a director for Aviat Networks, Inc., including as a
member of its Compensation Committee and its Nominating and Governance Committee, from January 2015 to November 2016. From 2005
to 2012, Mr. Pearse served as vice president of Strategy and Market Development at NetApp, Inc., a computer storage and data management
company. From 1987 to 2004, Mr. Pearse held leadership positions at Hewlett-Packard Inc., most recently as the vice president of
Strategy and Corporate Development from 2001 to 2004. Mr. Pearse&rsquo;s professional experience also includes positions at PricewaterhouseCoopers
LLP, Eastman Chemical Company and General Motors Company. Mr. Pearse earned an M.B.A. degree from the Stanford Graduate School
of Business and a B.S. degree in Mechanical Engineering from the Georgia Institute of Technology. The Board believes Mr. Pearse&rsquo;s
qualifications to serve on the Board include his extensive business development and financial expertise and his extensive background
in the technology sector.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Dhruwa N. Rai </B>became
a member of our Board and also began serving as our in-house management consultant in May 2016. Mr. Rai served as the Global Vice
President of Industrial Coatings at Axalta Coatings Systems Ltd. (&ldquo;Axalta&rdquo; and formerly DuPont Performance Coatings),
one of the largest coating companies in the world, from December 2014 to August 2015. Mr. Rai joined Axalta in February 2013 as
the Vice President of Business Processes and Chief Information Officer, where he led its business process and IT transformation,
including its separation from E. I. du Pont de Nemours and Company (d/b/a DuPont). From March 2012 to January 2013, Mr. Rai served
as the Chief Information Officer of The Williams Companies, Inc., an energy infrastructure company. From June 2009 to December
2011, Mr. Rai served as the Chief Information Officer and Vice President of Momentive Performance Materials Inc. (formerly GE Advanced
Materials), a manufacturer of specialty materials for diverse industrial applications, where he led its divestiture from General
Electric Co. (&ldquo;General Electric&rdquo;). Mr. Rai also served as a director of FCS Software Solutions Ltd., an IT service
provider, from April 2008 to September 2010. Mr. Rai&rsquo;s prior professional experience also includes leadership positions with
GE Security, a former division of General Electric that was acquired by United Technologies Corporation; Delphi Automotive PLC,
a leading global supplier of technologies for the automotive and commercial vehicle market; and Ernst &amp; Young LLP. Mr. Rai
holds a Bachelor of Engineering degree in Production Engineering from G.B. Pant University (India) and an M.B.A. from the University
of Connecticut. The Company believes that Mr. Rai&rsquo;s leadership experience with global public companies and his expertise
in the IT and technology sectors qualify his to serve on the Board.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Venkatraman
Balakrishnan</B> became a member of our Board in June 2016. He is the Founder and Chairman of Exfinity Venture Partners,
a venture capital fund focused on investing in emerging technologies, which was founded in 2013. Mr. Balakrishnan served on
the board of directors of Infosys Limited, an IT services and consulting company, from June 2011 to December 2013. He also
served as the head of the BPO, Finacle and India business unit at Infosys Limited, and served as the Chief Financial Officer
of Infosys Limited from May 2006 to October 2012. Mr. Balakrishnan is currently the Chairman of the Board of Tejas Networks
Limited (formerly Tejas Networks India Limited), an Indian computer networking and telecommunications products company, and
as the Chairman of Micrograam, a peer-to-peer lending platform that empowers rural entrepreneurs with access to loans from
socially minded investors, Mr. Balakrishnan is also a trustee of Akshaya Patra Foundation, a non-governmental
organization that provides mid-day meals to millions of children across India. Mr. Balakrishnan received a Bachelor of
Science degree from the University of Madras and is an Associate Member of the Institute of Chartered Accountants of India,
the Institute of Company Secretaries of India and the Institute of Cost and Works Accountants of India. The Company believes
that Mr. Balakrishnan&rsquo;s significant experience in leadership positions with technology services and consulting
companies, as well as his expertise with corporate finance domain, qualifies him to serve on the Board.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">All directors hold
office until the expiration of their respective term, in 2016, 2017 or 2018, at each year&rsquo;s annual meeting of stockholders
and the election and qualification of their successors. Officers are elected annually by the Board and serve at the discretion
of the Board.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our previous Chief
Financial Officer, Edward O&rsquo;Donnell, departed from our company on December 2, 2016 to pursue new opportunities. At that time,
Carlos Fernandez, our former Executive Vice President of Corporate Development, was appointed as our interim Chief Financial Officer
while we conducted a search for a permanent Chief Financial Officer. Our current Chief Financial Officer, Viraj Patel, was appointed
effective April 24, 2017. Mr. Fernandez and Srirangan Rajagopal, our former Executive Vice President &ndash; Head of Marketing
and Strategic Initiatives, both resigned their positions with the Company, effective as of July 28, 2017. Mr. Fernandez and Mr.
Rajagopal had served in their positions with the Company since the Merger in May 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Advisory Board</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company&rsquo;s
Advisory Board (the &ldquo;Advisory Board&rdquo;), which advises the Board and management on business opportunities and strategy
of the Company, is comprised of the following individuals:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Robert Rosenberg</B>
was a member of our Board from May 2015 to June 2016. In June 2016, Mr. Rosenberg resigned from our Board and was appointed to
the Advisory Board. Mr. Rosenberg is the director of entrepreneurship programs at the Polsky Center for Entrepreneurship and Innovation
and adjunct associate professor of entrepreneurship at Chicago Booth since 2000. He has served in a variety of senior administrative
roles at the University of Chicago, most recently as associate vice president for marketing strategy and associate vice president
for research. Mr. Rosenberg came to the University of Chicago in 1989 as director of industrial relations and technology at the
University of Chicago Medical Center. Mr. Rosenberg was a founder of the Illinois Biotechnology Industry Organization and the Midwest
Research University Network. He is a director of Illinois&rsquo; Technology Development Fund, a board member of Manufacturing Renaissance
and Fortify, and a co-chair of Hyde Park Angels Healthcare Ambassador Circle. Mr. Rosenberg earned a B.A. degree in English from
Harvard University, a master&rsquo;s degree in English literature from Tufts University, and an M.B.A. from the University of Chicago
Booth School of Business. The Board believes that Mr. Rosenberg&rsquo;s qualifications to serve on the Board include his background
and expertise in entrepreneurship.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Matt Stultz </B>was
appointed to the Advisory Board in November 2016. Mr. Stultz has extensive leadership and management experience in large scale
ERP implementations, technology centralization and shared services, solution and application architecture, and financial/budget
management planning. Currently, Mr. Stultz is Senior Vice President and General Manager, Retail and Fashion Services for North
America, at SAP, a multinational enterprise software company. He has worked for several Fortune 500 companies including SAP, Nike,
The Home Depot, Newell Rubbermaid, Honeywell, Olin Corporation, and Microsoft. Mr. Stultz serves on the LinkedIn Social Executive
Council for Facebook, Twitter, and LinkedIn Integration Initiatives. He is also on the LinkedIn TechExecs and CIO Forum Councils.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Jim Shad </B>was
appointed to the Advisory Board in November 2016. Mr. Shad is a seasoned executive with 38 years of experience in a diverse set
of industries spanning consumer products, health care, consumer electronics, major appliances and housing. He is currently Principal
of Renaissance Growth Consultants. In 2013, Mr. Shad served as the President of C3 Design, a small start-up in the housing sector.
From 2009 to 2012, Mr. Shad served as Viking&rsquo;s Chief Revenue Officer. From 2003 to 2009, he served as LG USA&rsquo;s President
and Chief Executive Officer. From 2000 to 2003, he was the Global Chief Customer Officer for Novartis&rsquo; Consumer Health Division.
Mr. Shad began his career as a territory salesman with Procter and Gamble in 1979, rising to the head of North American Market
Strategy in 2000. Mr. Shad recently served as an advisory board member to Precipio Corporation and currently serves on the advisory
board at Babel St. Corporation. He guest lectures on Leadership and Business Strategy at the University of Georgia Terry College
of Business Executive MBA program. Mr. Shad earned a B.A. degree in business from the University of Georgia.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Joyce Cruickshank
</B>was appointed to the Advisory Board in November 2016. Ms. Cruickshank is currently the Business Solutions Officer for Amtrak
Operations, Northeast Corridor Infrastructure and Investment, Americas Railroad. Prior to joining Amtrak, Ms. Cruickshank was the
acting Chief Information Officer and Chief Technology Officer at Corizon Health and worked at AOL/Time Warner for eleven years
starting as a Portfolio Director and ending her career as a VP of Technology for the largest revenue division within AOL. In addition,
Ms. Cruickshank held leadership roles in five start-ups in industries including online banking, e-commerce and telecommunications.
Ms. Cruickshank is a co-chair of the Capital area Corporate Council for the American Cancer Society and has held previous board
positions in other non-profits. Ms. Cruickshank earned an undergraduate degree from West Virginia Wesleyan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B>Marius van Gijlswijk
</B>was appointed to the Advisory Board in November 2016. Mr. van Gijlswijk was a principal of Ameri Arizona until we acquired
it in July 2016. Before founding Ameri Arizona, Mr. van Gijlswijk was Chief Operating Officer and Chief Financial Officer of a
Silicon Valley internet startup. Mr. van Gijlswijk has over 28 years of SAP experience. He has served in various global project
leadership positions and has consulted extensively in the area of Logistics, System Integration and Technical Architecture, and
has worked with such consulting firms as Deloitte and BearingPoint. He has a master&rsquo;s degree in Applied Mathematics and Computer
Science from Technical University Eindhoven (Netherlands).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Board Independence</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Board of Directors
has determined that Dimitrios J. Angelis, Dr. Arthur M. Langer, Jeffrey E. Eberwein, Robert Pearse and Venkatraman Balakrishnan
are &ldquo;independent,&rdquo; as independence is defined in the listing standards for The Nasdaq Stock Market. The Nasdaq independence
definition includes a series of objective tests, such as that the director is not, and has not been for at least three years, one
of our employees and that neither the director, nor any of his family members has engaged in various types of business dealings
with us. In addition, as provided by the Nasdaq rules, our Board has made a subjective determination as to each independent director
that no relationships exist which, in the opinion of our Board, would interfere with the exercise of independent judgment in carrying
out the responsibilities of a director. In making these determinations, our Board reviewed and discussed information provided by
the directors and us with regard to each director&rsquo;s business and personal activities and relationships as they may relate
to us and our management.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Board Committees</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The standing committees
of our board of directors currently consists of an Audit Committee, Compensation Committee and a Nominations and Corporate Governance
Committee. Each of the committees report to Board as they deem appropriate and as the Board may request. The composition, duties
and responsibilities of these committees are set forth below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B><I>Audit Committee</I>.</B>&nbsp;The
Audit Committee consists of Messrs. Angelis, Pearse and Balakrishnan, with Mr.&nbsp;Balakrishnan serving as chairman. All members
of the Audit Committee are (i)&nbsp;independent directors (as currently defined in Rule 5605(a)(2) of the Nasdaq listing rules);
(ii)&nbsp;meet the criteria for independence set forth in Rule 10A-3(b)(1) under the Exchange Act; (iii)&nbsp;not have participated
in the preparation of the financial statements of the Company or any current subsidiary of the Company at any time during the past
three years; and (iv)&nbsp;are able to read and understand fundamental financial statements. Mr.&nbsp;Angelis qualifies as an &ldquo;Audit
Committee financial expert&rdquo; as defined in the rules and regulations established by the SEC. The Audit Committee is governed
by a written charter approved by our Board of Directors. The functions of the Audit Committee include, among other things:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-size: 10pt">&middot;</FONT></TD><TD STYLE="text-align: justify">Meeting with our management periodically to consider the adequacy of our internal controls and
the objectivity of our financial reporting;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-size: 10pt">&middot;</FONT></TD><TD STYLE="text-align: justify">Meeting with our independent registered public accounting firm and with internal financial personnel
regarding the adequacy of our internal controls and the objectivity of our financial reporting;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-size: 10pt">&middot;</FONT></TD><TD STYLE="text-align: justify">Recommending to our Board of Directors the engagement of our independent registered public accounting
firm;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-size: 10pt">&middot;</FONT></TD><TD STYLE="text-align: justify">Reviewing our quarterly and audited consolidated financial statements and reports and discussing
the statements and reports with our management, including any significant adjustments, management judgments and estimates, new
accounting policies and disagreements with management; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-size: 10pt">&middot;</FONT></TD><TD STYLE="text-align: justify">Reviewing our financial plans and reporting recommendations to our full Board of Directors for
approval and to authorize action.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Both our independent
registered public accounting firm and internal financial personnel regularly meet privately with our Audit Committee and have unrestricted
access to the Audit Committee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B><I>Compensation
Committee</I></B>. The Compensation Committee consists of Messrs. Eberwein, Langer and Pearse, with Mr.&nbsp;Pearse serving as
chairman. Messrs. Eberwein, Langer and Pearse are independent (as currently defined in Rule 5605(a)(2) of the Nasdaq listing rules),
SEC and Internal Revenue Service qualification requirements. The Compensation Committee is governed by a written charter approved
by our Board of Directors. The charter of the Compensation Committee permits the Compensation Committee to engage outside consultants
and to consult with our human resources department when appropriate to assist in carrying out its responsibilities. Compensation
consultants have not been engaged by the Company to recommend or assist in determining the amount or form of compensation for any
current executive officers or directors of the Company. The Committee may also obtain advice and assistance from internal or external
legal, accounting, or other advisers selected by the Committee. The functions of the Compensation Committee include, among other
things:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-size: 10pt">&middot;</FONT></TD><TD STYLE="text-align: justify">Reviewing and, as it deems appropriate, recommending to our Board of Directors, policies, practices,
and procedures relating to the compensation of our directors, officers and other managerial employees and the establishment and
administration of our employee benefit plans;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-size: 10pt">&middot;</FONT></TD><TD STYLE="text-align: justify">Establishing appropriate incentives for officers, including the Chief Executive Officer, to encourage
high performance, promote accountability and adherence to company values and further our long-term strategic plan and long-term
value; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-size: 10pt">&middot;</FONT></TD><TD STYLE="text-align: justify">Exercising authority under our employee benefit plans.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B><I>Corporate Governance
Committee</I></B>. The Nominations and Corporate Governance Committee consists of Messrs. Angelis, Eberwein and Balakrishnan, with
Mr.&nbsp;Angelis serving as chairman. Messrs. Eberwein, Angelis and Balakrishnan are independent directors (as currently defined
in Rule 5605(a)(2) of the Nasdaq listing rules). The Nominations and Corporate Governance Committee is governed by a written charter
approved by our Board of Directors. The functions of the Nominations and Corporate Governance Committee include, among other things:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-size: 10pt">&middot;</FONT></TD><TD STYLE="text-align: justify">Reviewing and recommending nominees for election as directors;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-size: 10pt">&middot;</FONT></TD><TD STYLE="text-align: justify">Assessing the performance of our board of directors;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-size: 10pt">&middot;</FONT></TD><TD STYLE="text-align: justify">Developing guidelines for the composition of our board of directors;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-size: 10pt">&middot;</FONT></TD><TD STYLE="text-align: justify">Reviewing and administering our corporate governance guidelines and considering other issues relating
to corporate governance; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-size: 10pt">&middot;</FONT></TD><TD STYLE="text-align: justify">Oversight of the Company compliance officer and compliance with the Company&rsquo;s Code of Ethics
and Business Conduct and Code of Ethics for our Chief Executive Officer and Senior Financial Officers.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Code of Ethics</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have adopted a Code
of Ethics that applies to all of our employees, including our chief executive officer, chief financial officer and principal accounting
officer. Our Code of Ethics is available on our website at www.ameri100.com. If we amend or grant a waiver of one or more of the
provisions of our Code of Ethics, we intend to satisfy the requirements under Item&nbsp;5.05 of Form&nbsp;8-K regarding the disclosure
of amendments to or waivers from provisions of our Code of Ethics that apply to our principal executive officer, principal financial
officer and principal accounting officer by posting the required information on our website at the above address. Our website is
not part of this prospectus.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Family Relationships</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Giri Devanur, our President,
Chief Executive Officer and a member of our Board, and Srinidhi &ldquo;Dev&rdquo; Devanur, our Executive Vice Chairman and a member
of our Board, are brothers. Ram Ramanan and Saravanan Swaminathan, who manage Ameri Georgia, are brothers. Other than these individuals,
there are no family relationships among our directors and executive officers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Involvement in Certain Legal Proceedings</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Lone Star Value Management
LLC and our director Jeffrey Eberwein are each subject to a SEC administrative order, dated February 14, 2017 (Securities Exchange
Act Release No. 80038), relating to alleged violations of Section 13(d) of the Exchange Act and the rules promulgated thereunder,
including failing to disclose the members of a stockholder group, and further allegations that Mr. Eberwein violated Section 16(a)
of the Exchange Act and the rules promulgated thereunder, including failing to timely file initial statements of beneficial ownership
on Form 3 and changes thereto on Form 4. Without admitting or denying any violations, (i) Lone Star Value Management agreed to
cease and desist from committing or causing any violations of Section 13(d) of the Exchange Act and Rules 13d-1 and 13d-2 promulgated
thereunder, and paid a civil penalty of $120,000 to the SEC and (ii) Mr. Eberwein agreed to cease and desist from committing or
causing any violations of (x) Section 13(d) of the Exchange Act and Rules 13d-1 and 13d-2 promulgated thereunder and (y) Section
16(a) of the Exchange Act and Rules 16a-2 and 16a-3 promulgated thereunder, and paid a civil penalty to the SEC in the amount of
$90,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_060"></A>Executive
Compensation</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Elements of Executive<FONT STYLE="font-weight: normal">&nbsp;</FONT>Compensation</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our executive compensation
consists of the following elements:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Base salary;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Annual Incentive Bonus;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Long-Term Incentives; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Retirement benefits under a 401(k) plan and generally available benefit programs.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B><I>Base Salary</I>.&nbsp;</B>The
base salary for each executive is initially established through negotiation at the time the executive is hired, taking into account
his or her scope of responsibilities, qualifications, experience, prior salary, and competitive salary information within our industry.
Year-to-year adjustments to each executive officer&rsquo;s base salary are determined by an assessment of his or her sustained
performance against individual goals, including leadership skills and the achievement of high ethical standards, the individual&rsquo;s
impact on our business and financial results, current salary in relation to the salary range designated for the job, experience,
demonstrated potential for advancement, and an assessment against base salaries paid to executives for comparable jobs in the marketplace.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Based on the factors
discussed above, base salaries of our Chief Executive Officer and our two other most highly compensated executive officers (&ldquo;Named
Executive Officers&rdquo;) as of December 31, 2016 (on an annualized basis) were as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Giri Devanur&rsquo;s
2016 base salary was set at $120,000, which represented no change from 2015. However, effective November 14, 2016, Mr. Devanur&rsquo;s
annual base salary was raised to $220,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Srirangan Rajagopal&rsquo;s
2016 base salary was set at $144,000, which represented no increase from 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Carlos Fernandez&rsquo;s
2016 base salary was set at $141,600, which represented no increase from 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B><I>Annual Bonus</I></B>.
Annual bonus payments under our executive employment agreements are based on the discretion of our Board of Directors. We believe
that such bonuses provide our executives with an incentive to achieve goals that are aligned with our stockholders&rsquo; interests,
with the achievement of such goals being measurable in terms of revenue and income or other financial objectives. An executive
officer&rsquo;s failure to achieve measurable performance goals can affect his or her bonus amount. We believe that offering significant
potential income in the form of bonuses allows us to attract and retain executives and to align their interests with those of our
stockholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The maximum bonus Mr.
Devanur could have achieved under his employment agreement in the year ended December 31, 2016 was $110,000 (on an annualized basis).
As of December 31, 2016, a bonus of $57,500 had accrued but not yet been paid to our President and Chief Executive Officer, Giri
Devanur. Mr. Devanur&rsquo;s accrued bonus for 2016 was canceled as of June 30, 2017 and was no longer owed to Mr. Devanur.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B><I>Long-Term Incentives</I></B>.
The Compensation Committee has the ability to grant equity instruments to our executives under our 2015 Equity Incentive Award
Plan. The Compensation Committee has the ability to issue a variety of instruments, but equity grants will typically be in the
form of stock options and restricted stock units. We believe that our executive compensation program must include long-term incentives
such as stock options and restricted stock units if we wish to hire and retain high-level executive talent. We also believe that
stock options and restricted stock units help to provide a balance to the overall executive compensation program as base salary
and bonus awards focus only on short-term compensation. In addition, the vesting period of stock options and restricted stock units
encourages executive retention and the preservation of stockholder value. Finally, we believe that aligning at least a portion
of restricted stock units vesting provisions to financial performance measures further aligns executive compensation to stockholder
value; if performance targets are not achieved, then the awards do not vest. We base the number of equity units granted on the
type and responsibility level of the executive&rsquo;s position, the executive&rsquo;s performance in the prior year and the executive&rsquo;s
potential for continued sustained contributions to our long-term success and the long-term interests of our stockholders.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><B><I>401(k) and Other
Benefits</I></B>. During 2016, our executive officers were eligible to receive certain benefits generally available to all our
employees on the same terms, including medical, dental and vision insurance, long-term and short-term disability insurance, life
and accidental death and dismemberment insurance, health and dependent care flexible spending accounts, educational and employee
assistance, paid-time-off, and certain other benefits. During 2015, we also maintained a tax-qualified 401(k) Plan, which provides
for broad-based employee participation. During 2016, under the 401(k) Plan, all employees were eligible to receive matching contributions
from Ameri of (i) 100% of their first 3% of employee contributions and (ii) 50% of the next 2% of employee contributions up to
an aggregate maximum of $10,600 per employee, per year, subject to vesting provisions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Compensation Risk Assessment</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In establishing and
reviewing our overall compensation program, the Compensation Committee considers whether the program and its various elements encourage
or motivate our executives or other employees to take excessive risks. We believe that our compensation program and its elements
are designed to encourage our employees to act in the long-term best interests of the Company and are not reasonably likely to
have a material adverse effect on our business.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">The Impact of Tax and Accounting Treatments
on Elements of Compensation</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have elected to
award non-qualified stock options instead of incentive stock options to all our employees, directors and consultants to allow the
corporation to take advantage of the more favorable tax advantages associated with non-qualified stock options.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Internal Revenue Code
Section&nbsp;162(m) precludes us from deducting certain forms of non-performance-based compensation in excess of $1.0 million to
named executive officers. To date, we have not exceeded the $1.0 million limit for any executive, and the Compensation Committee
has not defined a policy that all compensation must be deductible. However, since stock-based awards comprise a significant portion
of total compensation, the Compensation Committee has taken appropriate steps to preserve deductibility for such awards in the
future, when appropriate.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Summary Compensation<FONT STYLE="font-weight: normal">&nbsp;</FONT>Table</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following table
provides information regarding the compensation earned during the years ended December 31, 2016 and December 31, 2015 by our Named
Executive Officers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font-size: 10pt">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="width: 30%; border-bottom: Black 1pt solid"><B>Name &amp; Principal Position</B></TD>
    <TD STYLE="width: 6%; border-bottom: Black 1pt solid; text-align: center"><B>Transition Period or Fiscal Year Ended</B></TD>
    <TD STYLE="width: 2%; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 6%; border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Salary</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>($)</B>&nbsp;</P></TD>
    <TD STYLE="width: 2%; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 6%; border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Bonus</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>($)</B></P></TD>
    <TD STYLE="width: 2%; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 6%; border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Stock Awards</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>($)</B></P></TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 6%; border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Option Awards</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>($)</B></P></TD>
    <TD STYLE="width: 2%; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 6%; border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Non-Equity Incentive Plan Compensation</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>($)</B>&nbsp;</P></TD>
    <TD STYLE="width: 2%; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 6%; border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Non-Qualified Deferred Compensation
Earnings</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>($)</B></P></TD>
    <TD STYLE="width: 2%; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 6%; border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>All Other Compensation</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>($)</B></P></TD>
    <TD STYLE="width: 2%; border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 6%; border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Total</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>($)</B></P></TD></TR>
<TR STYLE="vertical-align: top; background-color: #CCEEFF">
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Giri Devanur<SUP>(1)</SUP></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>President and Chief Executive Officer</I></P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">12/31/2016</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">12/31/2015</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">175,000</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;147,500</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">57,500</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;45,000</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">232,500</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;192,500</P></TD></TR>
<TR STYLE="vertical-align: top; background-color: white">
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Srirangan Rajagopal<SUP>(2)</SUP></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>Executive Vice President &ndash; Head of Marketing
and Strategic Initiatives</I></P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">12/31/2016</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;12/31/2015</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">144,000</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;143,000</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">9,000</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">144,000</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;152,000</P></TD></TR>
<TR STYLE="vertical-align: top; background-color: #CCEEFF">
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Carlos Fernandez<SUP>(3)</SUP></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>Executive Vice President &ndash; Corporate Development</I></P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">12/31/2016</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;12/31/2015</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">141,600</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;141,600</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD>&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD STYLE="border-bottom: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">141,600</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;141,600</P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Edward O&rsquo;Donnell<SUP>(4)</SUP></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><I>Former Chief Financial Officer</I></P></TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">12/31/2016</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;12/31/2015</P></TD>
    <TD>&nbsp;</TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">175,000</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;&mdash;</P></TD>
    <TD>&nbsp;</TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD>&nbsp;</TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD>&nbsp;</TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD>&nbsp;</TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD>&nbsp;</TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD>&nbsp;</TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&mdash;</P></TD>
    <TD>&nbsp;</TD>
    <TD>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">175,000</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;&mdash;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right">&nbsp;</P></TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 6%">(1)</TD>
    <TD STYLE="width: 94%; text-align: justify">Giri Devanur was appointed to his position with our company on May 26, 2015 and
    served as Chief Executive Officer of Ameri and Partners. As of December 31, 2016, a bonus of $57,500 had accrued but not yet
    been paid to our President and Chief Executive Officer, Giri Devanur. Mr. Devanur&rsquo;s bonus was canceled as of June 30,
    2017 and was no longer owed to Mr. Devanur.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>(2)</TD>
    <TD STYLE="text-align: justify">Srirangan Rajagopal was appointed to his position with our company on May 26, 2015 and served as Executive Vice President &ndash; Head of Marketing and Strategic Initiatives until July 28, 2017.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>(3)</TD>
    <TD STYLE="text-align: justify">Carlos Fernandez was appointed as our Executive Vice President &ndash; Corporate Development and Secretary on May 26, 2015 and served in such position until July 28, 2017.&nbsp;&nbsp;Mr. Fernandez also served as our interim Chief Financial Officer from December 8, 2016 to April 24, 2017, as well as Executive Vice President &ndash; Corporate Development of Ameri and Partners until his departure from the Company on July 28, 2017.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>(4)</TD>
    <TD STYLE="text-align: justify">Edward O&rsquo;Donnell served as our Chief Financial Officer from January 27, 2016 through December 8, 2016.</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We entered into employment
agreements with Giri Devanur and Srinidhi &ldquo;Dev&rdquo; Devanur effective at the closing of the Merger. The employment agreements
appoint Giri Devanur as our President and Chief Executive Officer and Srinidhi &ldquo;Dev&rdquo; Devanur as our executive Vice
Chairman of the Board until May 26, 2018. Each of the employment agreements provide that each executive will receive an annual
salary of $120,000 per year, with a bonus for each of $50,000 per year, to be paid at the discretion of the Board. The employment
agreements incorporate the terms of our confidentiality and non-competition agreement, which contain covenants (a) restricting
the executive from engaging in any activity competitive with our business during the term of the employment agreement and for a
period of two years thereafter, (b) prohibiting the executive from disclosing confidential information regarding us at any time,
and (c) soliciting our employees, customers and prospective customers during the term of the employment agreement and for a period
of two years thereafter.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On November 9, 2016,
the Compensation Committee of the Board approved an increase in the base salary of our President and Chief Executive Officer, Giri
Devanur, to $220,000 per year, effective as of November 14, 2016. The Compensation Committee also approved Mr. Devanur&rsquo;s
eligibility to earn a bonus of up to 50% of his annual base salary, as determined in the discretion of the Compensation Committee
upon Mr. Devanur&rsquo;s satisfaction of criteria to be determined by the Compensation Committee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Equity<FONT STYLE="font-weight: normal">&nbsp;</FONT>Awards</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As of December 31,
2016, we had not granted any equity awards to, nor were any equity awards outstanding with respect to, our Named Executive Officers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Pension Benefits</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">None of our Named Executive
Officers participates in or has account balances in qualified or non-qualified defined benefit plans sponsored by us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Nonqualified Deferred<FONT STYLE="font-weight: normal">&nbsp;</FONT>Compensation</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">None of our Named Executive
Officers participates in or has account balances in non-qualified defined contribution plans or other deferred compensation plans
maintained by us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Potential Payments<FONT STYLE="font-weight: normal">&nbsp;</FONT>Upon
Termination or Change of Control<FONT STYLE="font-weight: normal">&nbsp;</FONT>Under Employment Agreements</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We entered into employment
agreements with Giri Devanur and Srinidhi &ldquo;Dev&rdquo; Devanur in May 2015. The employment agreements appointed Giri Devanur
as our President and Chief Executive Officer and Srinidhi &ldquo;Dev&rdquo; Devanur as our executive Vice Chairman of the Board
for three years. The employment agreements provide that if, during the term of their employment, they are terminated by us other
than for &ldquo;Cause&rdquo; or they resign for &ldquo;Good Reason,&rdquo; then they will continue to receive for a period of one
year following such termination their then current salary payable on the same basis as they were then being paid. Termination for
&ldquo;Cause&rdquo; means: (i) deliberate refusal or deliberate failure to carry out any reasonable order, consistent with their
position, of our Board of Directors after reasonable written notice; (ii) a material and willful breach of the employment agreement,
their confidentiality and non-competition agreement or similar agreements with us; (iii) gross negligence or willful misconduct
in the execution of their assigned duties; (iv) engaging in repeated intemperate use of alcohol or drugs; or (v) conviction of
a felony or other serious crime. &ldquo;Good Reason&rdquo; means (i) they shall have been assigned duties materially inconsistent
with their position; (ii) their salary is reduced more than 15% below its then current level; or (iii) material benefits and compensation
plans then currently in existence are not continued in effect for their benefit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If either of Messrs.
Devanur would have been terminated without cause at December 31, 2016 or if either of them would have resigned for good reason,
then Giri Devanur would have been entitled to receive a severance payment of $220,000 and Srinidhi Devanur would have been entitled
to receive a severance payment of $120,000.&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Securities Authorized for Issuance Under Equity Compensation
Plans</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On April 20, 2015,
our Board and the holder of a majority of our outstanding shares of common stock approved the adoption of our 2015 Equity Incentive
Award Plan (the &ldquo;Plan&rdquo;) and a grant of discretionary authority to the executive officers to implement and administer
the Plan. The Plan allows for the issuance of up to 2,000,000 shares of our common stock for award grants (all of which can be
incentive stock options). The Plan provides equity-based compensation through the grant of cash-based awards, nonqualified stock
options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance
units and other stock-based awards. As of December 31, 2016, restricted stock units for the issuance of 590,869 shares of common
stock and options to purchase 972,700 shares of our common stock had been granted and were outstanding. The Board of Directors
adopted the Plan to provide a means by which our employees, directors, officers and consultants may be granted an opportunity to
purchase our common stock, to assist in retaining the services of such persons, to secure and retain the services of persons capable
of filling such positions and to provide incentives for such persons to exert maximum efforts for our success.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Administration of
the Plan</I>. The Plan is to be administered by the Compensation Committee consisting of two or more directors who are &ldquo;non-employee
directors&rdquo; within the meaning of Rule 16b-3, and &ldquo;outside directors&rdquo; within the meaning of Section 162(m) of
the Code. In the event that for any reason the Compensation Committee is unable to act or if the Compensation Committee at the
time of any grant, award or other acquisition under the Plan does not consist of two or more &ldquo;non-employee directors,&rdquo;
or if there is no such committee, then the Plan will be administered by the Board of Directors, except to the extent such Board
of Directors action would have adverse consequences under Section 16(b) of the Securities Exchange Act or Code Section 162(m).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Subject to the other
provisions of the Plan, the Compensation Committee will have the authority, in its discretion: (i) to grant cash-based awards,
nonqualified stock options, incentive stock options, SARs, restricted stock, restricted stock units, performance shares, performance
units and other stock-based awards, all of which are referred to collectively as &ldquo;Awards&rdquo;; (ii) to determine the terms
and conditions of each Award granted (which need not be identical); (iii) to interpret the Plan and all Awards granted thereunder;
and (iv) to make all other determinations necessary or advisable for the administration of the Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Eligibility</I>.
The persons eligible for participation in the Plan as recipients of Awards include employees, consultants and directors to our
company or any subsidiary or affiliate of our company. In selecting participants, and determining the number of shares of common
stock covered by each Award, the Compensation Committee may consider any factors that it deems relevant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Shares Subject to
the Plan</I>. Subject to the conditions outlined below, the total number of shares of common stock which may be issued pursuant
to Awards granted under the Plan may not exceed 2,000,000 shares of common stock. The Plan provides for annual limits on the size
of Awards for any particular participant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In the event of certain
corporate events or transactions (including, but not limited to, the sale of all, or substantially all, of our assets or a change
in our shares or capitalization), the Compensation Committee, in its sole discretion, in order to prevent dilution or enlargement
of a participant&rsquo;s rights under the Plan, will substitute or adjust, as applicable, and subject to certain Code limitations,
the number and kind of shares of common stock that may be issued under the Plan or under particular forms of Awards, the number
and kind of shares of common stock subject to outstanding Awards, the option price or grant price applicable to outstanding Awards,
the annual Award limits, and other value determinations applicable to outstanding Awards.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Options</I>. An
option granted under the Plan is designated at the time of grant as either an incentive stock option or as a non-qualified stock
option. Upon the grant of an option to purchase shares of common stock, the Compensation Committee will specify the option price,
the maximum duration of the option, the number of shares of common stock to which the option pertains, the conditions upon which
an option will become vested and exercisable, and such other provisions as the Compensation Committee will determine which are
not inconsistent with the terms of the Plan. The purchase price of each share of common stock purchasable under an option will
be determined by the Compensation Committee at the time of grant, but may not be less than 100% of the fair market value of such
share of common stock on the date the option is granted. No option will be exercisable later than the sixth anniversary date of
its grant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Stock Appreciation
Rights</I>. Stock Appreciation Rights (&ldquo;SARs&rdquo;), which may be issued in tandem with options or be freestanding, will
be exercisable at such time or times and subject to such terms and conditions as determined by the Compensation Committee. The
term of SARs granted under the Plan will be determined by the Compensation Committee, in its sole discretion, and except as determined
otherwise by the Compensation Committee, no stock appreciation right will be exercisable later than the sixth anniversary date
of its grant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Restricted Stock
and Restricted Stock Units</I>. Shares of restricted stock and/or restricted stock units may be granted under the Plan aside from,
or in association with, any other Award and will be subject to certain conditions and contain such additional terms and conditions,
not inconsistent with the terms of the Plan, as the Compensation Committee deems desirable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Cash-Based Awards
and Other Stock-Based Awards</I>. Subject to the provisions of the Plan, the Compensation Committee may grant cash-based awards
or other types of equity-based or equity-related awards not otherwise described by the terms of the Plan (including the grant or
offer for sale of unrestricted shares of common stock) in such amounts and subject to such terms and conditions, as the Compensation
Committee will determine. Such Awards may involve the transfer of actual shares of common stock to participants, or payment in
cash or otherwise of amounts based on the value of shares of common stock. Each cash-based award will specify a payment amount
or payment range as determined by the Compensation Committee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Repricing of Options</I>.
The Compensation Committee may not &ldquo;reprice&rdquo; any Stock Option. &ldquo;Reprice&rdquo; means any of the following or
any other action that has the same effect: (i) reducing the per share exercise price of the shares subject to an option below the
per share exercise price as of the date the option is granted and, (ii) except for adjustment for stock splits, stock dividends,
reorganizations and similar events, granting in exchange for, or in connection with, the cancellation or surrender of an option
having a higher per share exercise price.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Restrictions on
Transferability</I>. The Awards granted under the Plan are not transferable and may be exercised solely by a participant or his
authorized representative during his lifetime or after his death by the person or persons entitled thereto under his will or the
laws of descent and distribution or his designation of beneficiary or as otherwise required by law. Any attempt to transfer, assign,
pledge or otherwise dispose of, or to subject to execution, attachment or similar process, any Award contrary to the provisions
set forth in the Plan will be void and ineffective and will give no right to the purported transferee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Change in Control</I>.
The Compensation Committee may provide for the acceleration of the vesting and exercisability of outstanding options, vesting of
restricted stock and restricted stock units and earlier exercise of freestanding SARs, in the event of a Change in Control of our
company. However, if the Compensation Committee takes no action at the time of the Change in Control, and the initial Award does
not otherwise specify, accelerated vesting and exercisability is contingent upon termination of employment by us or by the participant
for Good Reason within two years of the Change in Control.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Termination of the
Plan</I>. Unless sooner terminated as provided therein, the Plan will terminate six years from April 20, 2015, the date the Plan
was approved by stockholders. The termination of the Plan will not adversely affect any Awards granted prior to Plan termination.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><I>Amendments to the
Plan</I>. The Compensation Committee may at any time alter, amend, modify, suspend or terminate the Plan and any evidence of Award
in whole or in part; provided, however, that, without the prior approval of our stockholders, options issued under the Plan to
any individual will not be repriced, replaced, or regranted through cancellation, and no amendment of the Plan will be made without
stockholder approval if stockholder approval is required by law, regulation, or stock exchange rule; and except where required
by tax law, without the prior written consent of the participant, no modification will adversely affect an Award under the Plan.
The Compensation Committee can not issue any Awards while the Plan is suspended.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following table
sets forth information regarding our equity compensation plans as of December 31, 2016:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Plan Category</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Number of securities to be issued upon exercise of outstanding options, warrants and rights</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Weighted-average exercise price of outstanding options, warrants and rights</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: center">(a)</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: center">(b)</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: center">(c)</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 34%; font-size: 10pt; text-align: left">Equity compensation plans approved by security holders</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 18%; font-size: 10pt; text-align: right">1,563,569</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 18%; font-size: 10pt; text-align: right">2.67</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 18%; font-size: 10pt; text-align: right">436,431</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Warrants issued outside of our equity compensation plan</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,666,666</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1.80</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">Total</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">4,230,235</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">1.89</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">436,431</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Compensation <FONT STYLE="font-weight: normal">o</FONT>f
Directors</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Directors are expected
to timely and fully participate in all regular and special board meetings, and all meetings of committees that they serve on. We
compensate non-management directors through an annual grant of stock options and/or restricted stock units pursuant to the Plan.
Such option awards have an exercise price not less than 100% of the fair market value of our common stock, based on the value of
such shares of common stock on the date the option is granted, and both the option and restricted stock unit awards become vested
and exercisable as determined by the compensation committee or the entire Board. Other terms and conditions of the option and restricted
stock unit grants are on the terms and conditions as determined by the Compensation Committee or the entire Board when the options
or restricted stock units are granted.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following table
sets forth the cash compensation, as well as certain other compensation granted to each person who served as a director of our
company, during the twelve months ended December 31, 2016:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center">Name</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">Fees Earned or Paid in Cash</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">Stock Awards</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">RSU &amp; Option Awards</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>All Other</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Compensation</B></P></TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">Total</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">($)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">($)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">($)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">($)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">($)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Jeffrey E. Eberwein</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Srinidhi &ldquo;Dev&rdquo; Devanur</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Giri Devanur</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Dimitrios J. Angelis</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Dr. Arthur M. Langer</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Robert G. Pearse</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 25%; font-size: 10pt; text-align: left">Dhruwa N. Rai<FONT STYLE="font-size: 10pt"><SUP>(1)</SUP></FONT></TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">7,000,000</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">7,000,000</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">Venkatraman Balakrishnan<FONT STYLE="font-size: 10pt"><SUP>(2)</SUP></FONT></TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">212,747</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">212,747</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">TOTAL</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,212,747</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,212,747</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>


<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 7%">(1)</TD>
    <TD STYLE="width: 93%">Includes an option to purchase 500,000 shares of common stock granted on May 10, 2016, valued at $7.00 per share, and restricted stock units for 500,000 shares of common stock granted on May 10, 2016, valued at $7.00 per share. On May 9, 2017, Mr. Rai and the Company agreed to cancel 166,667 of the restricted stock units.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>(2)</TD>
    <TD>Includes an option to purchase 25,000 shares of common stock granted on June 28, 2016, valued at $6.51 per share, and restricted stock units for 7,680 shares of common stock granted on June 28, 2016, valued at $6.51 per share.&nbsp;&nbsp;On June 13, 2017, Mr. Balakrishnan and the Company agreed to cancel all of the restricted stock units.</TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<P STYLE="margin-top: 0; margin-bottom: 0"></P>

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<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_067"></A>Certain
Relationships and Related Transactions</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Lone Star Value</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Prior to the Merger,
LSVI and its affiliates, collectively, was our majority stockholder, and each of our directors and sole officers was an officer
of Lone Star Value Management, LLC. On January 15, 2014, our predecessor entity, Spatializer Audio Laboratories, Inc., issued 3,267,974
shares of common stock to Lone Star Value, an entity ultimately controlled by Jeffrey E. Eberwein, who was a director at the time
of the transaction at $0.0153 per share for total proceeds of $50,000 (and such shares became 185,575 shares of our common stock
as a result of the 1-for-17.61 reverse stock split of our outstanding shares of common stock that occurred contemporaneously with
the Merger in May 2015).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On April 17, 2015,
we issued a promissory note in the principal amount of $50,000 to LSVI. Under the terms of the promissory note, interest on the
outstanding principal amount accrues at a rate of 10% per annum, and all amounts outstanding under this promissory note are due
and payable on or before April 30, 2020. We intend to use the proceeds for legal and operating expenses.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On May 26, 2015, we
issued the Convertible Note in the principal amount of $5,000,000 bearing interest at 5% per annum, maturing on May 26, 2017 and
at a conversion price of $1.80 per share, or an aggregate of 2,777,778 shares of common stock, together with the Original Warrant
to purchase up to 2,777,777 shares of our common stock, at an exercise price equal to $1.80 per share, in the Private Placement
to LSVI, pursuant to the terms of a Securities Purchase Agreement. In connection with the Private Placement, LSVI was granted the
right to designate three of our eight directors.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On May 13, 2016, LSVI
completed an early partial exercise of the Original Warrant for 1,111,111 shares of our common stock for total consideration to
us of $2,000,000, and LSVI was issued a replacement warrant for the remaining 1,166,666 shares under the Original Warrant. LSVI
also agreed to amend the Convertible Note to extend its maturity for two years in exchange for (i) the right to request that we
expand the size of the Board to nine directors from the current eight, with LSVI having the right to designate up to four of the
nine directors and (ii) the issuance of the Additional Warrant for the purchase of 1,000,000 shares of our common stock at a price
of $6.00 per share. LSVI&rsquo;s Registration Rights Agreement, dated May 26, 2015, with us was also amended and restated to include
the shares of common stock issuable under the Additional Warrant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On December 30, 2016,
we entered into the Exchange Agreement with LSVI, pursuant to which the Convertible Note was returned to the Company and cancelled
in exchange for 363,611 shares of the Company&rsquo;s Series A Preferred Stock, which is non-convertible and perpetual preferred
stock of the Company. As a result of the exchange transaction, no principal or interest remained outstanding or payable under the
Convertible Note and the Convertible Note was no longer convertible into shares of our common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Purchase Agreement</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On April 20, 2016,
we entered into a Stock Purchase Agreement with Dhruwa N. Rai, pursuant to which Mr. Rai purchased from us 500,000 shares of our
common stock, par value $0.01 per share, at a price per share of $6.00 for an aggregate purchase price of $3,000,000 and we issued
500,000 unregistered shares of common stock to Mr. Rai.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Ameri India</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white">On
September 1, 2016, we issued 299,250 shares of common stock to Srinidhi &ldquo;Dev&rdquo; Devanur, our Executive Chairman, in connection
with the completion of our acquisition of </FONT>Ameri India <FONT STYLE="background-color: white">on July 1, 2016, pursuant to
the terms of a Stock Purchase Agreement dated May 26, 2015.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white"></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white"></FONT>&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Rai Note Transaction</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On March 2, 2017, we
entered into a Securities Purchase Agreement with Dhruwa N. Rai, pursuant to which Mr. Rai purchased from the Company and the Company
issued to Mr. Rai an 8% Convertible Unsecured Promissory Note due March 2, 2020, in the principal amount of $1,000,000 (the &ldquo;Rai
Note&rdquo;). Prior to maturity, the Rai Note will bear interest at 8% per annum, with interest being paid annually on the first,
second and third anniversaries of the issuance of the Rai Note beginning on March 2, 2018. From and after an event of default and
for so long as the event of default is continuing, the Rai Note will bear default interest at the rate of 10% per annum. The Rai
Note can be prepaid by us at any time without penalty.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Rai Note is convertible
into shares of our common stock at a conversion price of (i) in the event that any registration statement for the public offering
of common stock filed by us with the SEC in connection with an uplisting to a national stock exchange is declared effective by
the SEC on or prior to December 31, 2017, such price per share that is equal to 68% of the price per share of common stock offered
and sold pursuant to such registration statement, or (ii) if no such registration statement is declared effective by December 31,
2017, such price per share that is equal to the weighted average closing price per share of our common stock for the 20 trading
days immediately preceding December 31, 2017, subject to adjustment under certain circumstances. Upon the effectiveness of this
registration statement, the holder of the Rai Note has the right, at his option, at any time and from time to time to convert,
in part or in whole, the outstanding principal amount and all accrued and unpaid interest under the Rai Note into shares of the
Company&rsquo;s common stock at the then applicable conversion price.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Rai Note ranks
junior to our secured credit facility with Sterling National Bank. The Rai Note also includes certain negative covenants including,
without the investors&rsquo; approval, restrictions on dividends and other restricted payments and reclassification of its stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_069"></A>Security
Ownership of Certain Beneficial Owners and Management</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following table
sets forth information as of September __, 2017 regarding the beneficial ownership of our common stock by (i)&nbsp;each person
we know to be the beneficial owner of 5% or more of our common stock, (ii)&nbsp;each of our current executive officers, (iii)&nbsp;each
of our directors, and (iv)&nbsp;all of our current executive officers and directors as a group. Information with respect to beneficial
ownership has been furnished by each director, executive officer or 5% or more stockholder, as the case may be. Unless otherwise
indicated, the persons or entities identified in this table have sole voting and investment power with respect to all shares shown
as beneficially owned by them.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><B>Name<SUP>(1)</SUP></B></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Number of Shares Beneficially Owned</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid"><B>Percentage of Shares Beneficially Owned<SUP>(2)</SUP></B></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Executive Officers, Present Directors and Proposed Directors:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">Jeffrey E. Eberwein<SUP>(3)(4)</SUP></TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">4,443,795</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">25.66</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Srinidhi &ldquo;Dev&rdquo; Devanur</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">6,276,375</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">42.84</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Giri Devanur</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,179,125</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14.87</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Dimitrios J. Angelis<SUP>(5)</SUP></TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">48,604</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">*</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Dr. Arthur M. Langer<SUP>(6)</SUP></TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">94,862</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">*</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Robert G. Pearse<SUP>(7)</SUP></TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">47,700</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">*</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Carlos Fernandez<SUP>(8)</SUP></TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">101,250</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">*</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">Venkatraman Balakrishnan<SUP>(9)</SUP></TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">27,995</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">*</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Srirangan Rajagopal<SUP>(10)</SUP></TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">432,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2.95</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Dhruwa N. Rai<SUP>(11)</SUP></TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">669,996</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4.52</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Edward O&rsquo;Donnell<FONT STYLE="font-size: 10pt"><SUP>(12)</SUP></FONT></TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">*</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Viraj Patel</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">*</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">All executive officers and directors as a group (12 persons)<SUP>(13)</SUP></TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14,294,636</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">81.29</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold">5% Stockholders:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Lone Star Value Management, LLC<SUP>(3)(4)</SUP></TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,443,795</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">25.66</TD><TD STYLE="font-size: 10pt; text-align: left">%</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">______________</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 6%">*</TD>
    <TD STYLE="width: 94%">Less than one percent of outstanding shares.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">(1)</TD>
    <TD STYLE="text-align: justify">Unless otherwise indicated, the address of each person or entity is c/o AMERI Holdings, Inc., 100 Canal Pointe Boulevard, Suite 108, Princeton, New Jersey 08540.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">(2)</TD>
    <TD STYLE="text-align: justify">The calculation in this column is based upon 14,650,412 shares of common stock outstanding as of September __, 2017.&nbsp;Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Shares of common stock that are currently convertible or exercisable within 60 days of September ___, 2017 are deemed to be beneficially owned by the person holding such securities for the purpose of computing the percentage of ownership of such person, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person.&nbsp;&nbsp;Unless otherwise indicated, the persons or entities identified in this table have sole voting and investment power with respect to all shares shown as beneficially owned by them.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">(3)</TD>
    <TD STYLE="text-align: justify">Includes (A) (i) 1,666,755 shares of common stock and (ii) 2,666,666 shares of common stock reserved for issuance upon the exercise of the Warrants, in each case held of record by LSVI, and (B) 27,066 shares of common stock held of record by Jeffrey E. Eberwein, our Chairman. Lone Star Value Investors GP, LLC (&ldquo;Lone Star Value GP&rdquo;), the general partner of LSVI and Lone Star Value Management, the investment manager of LSVI, may be deemed to beneficially own the 4,333,421 shares held by LSVI. Jeffrey E. Eberwein as the managing member of Lone Star Value GP may be deemed to beneficially own the 4,333,421 shares held by LSVI. Mr. Eberwein disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein. The address of Mr. Eberwein, LSVI, Lone Star Value GP and Lone Star Value Management is 53 Forest Avenue, 1st&nbsp;Floor, Old Greenwich, CT 06870.</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify; width: 6%">(4)</TD>
    <TD STYLE="text-align: justify; width: 94%">Includes 83,308 shares held in an account separately managed by Lone Star Value Management. Lone Star Value Management, as the investment manager of the separately managed account, may be deemed to beneficially own the 83,308 shares held in the separately managed account; and Jeffrey Eberwein, our Chairman, as the sole member of Lone Star Value Management may be deemed to beneficially own the shares held in the separately managed account.&nbsp;Mr. Eberwein disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">(5)</TD>
    <TD STYLE="text-align: justify">Consists of 23,604 shares of common stock and 25,000 shares of common stock issuable upon exercise of options exercisable within 60 days.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">(6)</TD>
    <TD STYLE="text-align: justify">Consists of 69,862 shares of common stock and 25,000 shares of common stock issuable upon exercise of options exercisable within 60 days.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">(7)</TD>
    <TD STYLE="text-align: justify">Consists of 22,700 shares of common stock and 25,000 shares of common stock issuable upon exercise of options exercisable within 60 days.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">(8)</TD>
    <TD STYLE="text-align: justify">Carlos Fernandez served as our Executive Vice President &ndash; Corporate Development from May 26, 2015 through July 28, 2017.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">(9)</TD>
    <TD STYLE="text-align: justify">Consists of 2,995 shares of common stock and 25,000 shares of common stock issuable upon exercise of options exercisable within 60 days.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">(10)</TD>
    <TD STYLE="text-align: justify">Srirangan Rajagopal served as our Executive Vice President &ndash; Head of Marketing and Strategic Initiatives from May 26, 2015 through July 28, 2017.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">(11)</TD>
    <TD STYLE="text-align: justify">Consists of 503,329 shares of common stock and 166,667 shares of common stock issuable upon exercise of options exercisable within 60 days.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">(12)</TD>
    <TD STYLE="text-align: justify">Edward O&rsquo;Donnell served as our Chief Financial Officer from January 27, 2016 through December 8, 2016.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="text-align: justify">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">(13)</TD>
    <TD STYLE="text-align: justify">Consists of 11,361,303 shares of common stock, 2,666,666 shares of common stock reserved for issuance upon the exercise of the Warrants held of record by LSVI and 266,667 shares of common stock issuable upon exercise of options exercisable within 60 days.</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In addition, LSVI holds
383,985 shares of our Series A Preferred Stock, representing 100% of the issued and outstanding shares of the Series A Preferred
Stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_071"></A>Description
of Capital Stock</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Authorized and Outstanding Stock</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our certificate of
incorporation authorizes the issuance of 101,000,000 shares of capital stock, consisting of 100,000,000 shares of common stock,
and 1,000,000 shares of preferred stock, $0.01 par value, 700,000 of which have been designated as 9.0% Series A Cumulative Preferred
Stock, par value $0.01 per share, which we refer to herein as the Series A Preferred Stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">As of September ___,
2017, there were 14,650,412 shares of common stock outstanding, held of record by 534 holders, and 383,985 shares of Series A Preferred
Stock outstanding, held of record by one holder. In addition, 2,666,666 Warrant Shares are issuable upon exercise of the 2,666,666
Warrants, held of record by one holder. The number of record holders of our common stock, Series A Preferred Stock and Warrants
does not include beneficial owners holding shares through nominee names.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Common Stock</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Holders of our common
stock are entitled to one vote per share on all matters on which stockholders may vote at all stockholder meetings. Our Certificate
of Incorporation does not provide for cumulative voting. Holders of our common stock are entitled to receive ratably such dividends,
if any, as may be declared by our Board out of legally available funds. However, the current policy of our Board is to retain earnings,
if any, for the operation and expansion of the company. Upon liquidation, dissolution or winding-up, the holders of our common
stock are entitled to share ratably in all of our assets which are legally available for distribution. The holders of our common
stock have no preemptive, subscription, redemption or conversion rights.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Preferred Stock</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our Certificate of
Incorporation provides that shares of our preferred stock may be issued from time to time in one or more series. Our Board is authorized
to fix the voting rights, if any, designations, powers, preferences, the relative, participating, optional or other special rights
and any qualifications, limitations and restrictions thereof, applicable to the shares of each series. Our board of directors is
able to, without stockholder approval, issue preferred stock with voting and other rights that could adversely affect the voting
power and other rights of the holders of the common stock and could have anti-takeover effects. The ability of our Board to issue
preferred stock without stockholder approval could have the effect of delaying, deferring or preventing a change of control of
us or the removal of existing management.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">Series A Preferred Stock</P>

<P STYLE="font: italic 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On December 30, 2016,
we filed a Certificate of Designation of Rights and Preferences (the &ldquo;Certificate of Designation&rdquo;) to our Certificate
of Incorporation for the Series A Preferred Stock with the Secretary of State of the State of Delaware with respect to 700,000
shares of Series A Preferred Stock. Pursuant to the Certificate of Designation, except upon a change of control of the Company,
the Series A Preferred Stock is not convertible into, or exchangeable for, any of the Company&rsquo;s other property or securities.
The Certificate of Designation provides for the payment of cash dividends on the Series A Preferred Stock at a rate of 9.00% per
annum, provided that we may pay dividends in-kind through the issuance of additional shares to holders of the Series A Preferred
Stock at a rate per annum equal to 11.00% per annum, at the sole option of the Company, for up to four quarterly dividend periods
in any consecutive 36-month period, determined on a rolling basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Series A Preferred
Stock has no voting rights; however, if the Company does not pay dividends on the Series A Preferred Stock for six or more quarterly
periods, whether or not consecutive, the holders of the Series A Preferred Stock, voting as a single class with the holders of
any other parity security upon which like voting rights have been conferred and are exercisable, will be entitled to vote for the
election of two additional directors to serve on the Company&rsquo;s board of directors until the Company pays all dividends owed
on the Series A Preferred Stock and parity securities. In addition, the affirmative vote of the holders of at least two-thirds
of the outstanding shares of Series A Preferred Stock (such series voting together as a separate class) shall be required for to
authorize, create or increase shares ranking senior to the Series A Preferred Stock or to effect certain amendments to the Company
charter that would materially and adversely affect the terms of the Series A Preferred Stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company may not
redeem the Series A Preferred Stock prior to the one year anniversary of its issuance, except pursuant to a special redemption
following a change of control of the Company. On and after the one year anniversary of the issuance of the Series A Preferred Stock,
the Company may redeem the Series A Preferred Stock for cash at its option, in whole or in part, at a redemption price of $50 per
share, plus accrued and unpaid dividends. Following a change of control, the Company will have the option to redeem the Series
A Preferred Stock for cash at $50 per share plus accrued and unpaid dividends, in whole or in part. The Series A Preferred Stock
shall not have any stated maturity redemption date and will not be subject to any sinking fund or mandatory redemption provisions
except for redemption at the Company&rsquo;s option upon a change of control.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Upon a change of control,
holders of the Series A Preferred Stock will have the right (unless, prior to the change of control conversion date, the Company
provides notice of its election to redeem the Series A Preferred Stock) to convert some or all of the Series A Preferred Stock
on a specified change of control conversion date into a number of shares of common stock (or equivalent value of alternative consideration)
per share of Series A Preferred Stock to be converted equal to the lesser of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">the quotient obtained by dividing (1) the sum of the $50.00 liquidation preference plus the amount
of any accumulated and unpaid dividends to, but not including, the change of control conversion date (unless the change of control
conversion date is after a record date for a Series A Preferred Stock dividend payment and prior to the corresponding Series A
Preferred Stock dividend payment date, in which case no additional amount for such accumulated and unpaid dividends will be included
in this sum) by (2) the common stock price at the time of conversion; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">25.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">If, prior to the change
of control conversion date, the Company provides a redemption notice, whether pursuant to the special optional redemption right
in connection with a change of control or the optional redemption right, the Series A Preferred Stock will not have any right to
convert in connection with the change of control conversion right and any Series A Preferred Stock subsequently selected for redemption
that has been tendered for conversion will be redeemed on the related date of redemption instead of converted on the change of
control conversion date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Warrants</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white">The
Original Warrants issued in the Private Placement give LSVI the right to purchase up to 2,666,666 shares of common stock (the Original
Warrant Shares) at an exercise price equal to $1.80 per share. The Original Warrant may be exercised on a cashless-exercise basis,
meaning that, upon exercise, the holder would make no cash payment to us, and would receive a number of shares of our common stock
having an aggregate value equal to the excess of the then-current market price of the Original Warrant Shares issuable upon exercise
of the Original Warrant over the exercise price of the Original Warrant. The Original Warrant will expire on May 26, 2020. The
Original Warrant exercise price is subject to customary adjustment provisions for stock splits, stock dividends, recapitalizations
and the like.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On May 13, 2016, LSVI
completed an early partial exercise of the Original Warrants for 1,111,111 shares the Company&rsquo;s common stock at a price of
$1.80 per share, for total consideration to the Company of $2,000,000, and LSVI was issued a replacement warrant for the remaining
1,166,666 shares under the Original Warrants on the same terms as the Original Warrants. LSVI also agreed to an amendment of the
Convertible Note, to extend the maturity of the Convertible Note for two years in exchange for (i) the right to request that the
Board expand the size of the Board to nine directors from the current eight, with LSVI having the right to designate up to four
of the nine directors, and (ii) the issuance of a the Additional Warrant for the purchase of 1,000,000 shares of the Company&rsquo;s
common stock at a price of $6.00 per share, on substantively the same terms as the Original Warrant. LSVI&rsquo;s Registration
Rights Agreement, dated May 26, 2015, with us was also amended and restated to include the Additional Warrant Shares issuable under
the Additional Warrant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On December 30, 2016,
the Company entered into the Exchange Agreement with LSVI, pursuant to which the Convertible Note was returned to the Company and
cancelled in exchange for 363,611 shares of the Company&rsquo;s Series A Preferred Stock, which is non-convertible and perpetual
preferred stock of the Company. As a result of the exchange transaction, no principal or interest remained outstanding or payable
under the Convertible Note and the Convertible Note was no longer convertible into shares of common stock of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Dividends</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">To date, we have not
paid any cash dividends on our common stock or the Series A Preferred Stock. The payment of cash dividends in the future will be
dependent upon our revenues and earnings, if any, capital requirements and general financial condition and will be within the discretion
of our Board at such time. Further, if we incur any indebtedness, our ability to declare dividends may be limited by restrictive
covenants we may agree to in connection therewith.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Our Transfer Agent and Warrant Agent</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The transfer agent
and registrar for our common stock and Series A Preferred Stock is Corporate Stock Transfer, located in Denver, Colorado. We serve
as the warrant agent for the Warrants.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Certain Anti-Takeover Provisions of Delaware Law</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Pursuant to our Certificate
of Incorporation, we are not subject to the provisions of Section 203 of the Delaware General Corporation Law regulating corporate
takeovers through a &ldquo;business combination&rdquo; with a stockholder who owns 15% or more of our outstanding voting stock
(otherwise known as an &ldquo;interested stockholder&rdquo;).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Registration Rights</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In accordance with
the terms of the sale of the 2017 Notes, the investors and the Company entered into Registration Rights Agreements, pursuant to
which the Company granted the investors piggyback registration rights in the event the Company proposes to register the offer and
sale of any shares of its common stock under the Securities Act (other than a registration (A) in connection with an uplisting
of the Company&rsquo;s common stock to a national stock exchange, (B) pursuant to a registration statement on Form S-8 (or other
registration solely relating to an offering or sale to employees or directors of the Company pursuant to any employee stock plan
or other employee benefit arrangement), (C) pursuant to a registration statement on Form S-4 (or similar form that relates to a
transaction subject to Rule 145 under the Securities Act or any successor rule thereto), or (D) in connection with any dividend
or distribution reinvestment or similar plan), whether for its own account or for the account of one or more stockholders of the
Company. We are obligated to maintain the effectiveness of such registration statement from its effective date until the later
of (a) the date on which all registrable shares have been sold or distributed or, if earlier, until such registrable securities
may be sold by under Rule 144 (provided that the Company&rsquo;s transfer agent has accepted an instruction from the Company to
such effect) or (b) the third (3rd) anniversary of the closing of the 2017 Notes sale. We agreed to use our best efforts to have
such registration statement declared effective by the SEC as soon as commercially reasonably possible. There are no monetary penalties
if the 2017 Notes piggyback registration statement is not filed or does not become effective on a timely basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Quotation of Common Stock</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our common stock is
quoted on the OTCQB Marketplace under the symbols &ldquo;AMRH&rdquo;. We have applied for the listing of our common stock on The
Nasdaq Capital Market, and expect such listing to occur concurrently with this offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_074"></A>Shares
Eligible for Future Sale</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Future sales of shares
of our common stock in the public market, or the availability of such shares for sale in the public market, could adversely affect
the market price of our common stock prevailing from time to time. As described below, only a limited number of shares are currently
available for sale due to contractual and legal restrictions on resale. Nonetheless, sales of our common stock, or the perception
that these sales could occur, could adversely affect prevailing market prices for our common stock and could impair our future
ability to raise equity capital in the future.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Based on the number
of shares outstanding as of September ___, 2017, upon the closing of this offering, __________ shares of common stock will be outstanding,
assuming no exercise of outstanding options, settlement of outstanding restricted stock units or warrants and no exercise of the
underwriters&rsquo; over-allotment option. Of the outstanding shares, all of the shares of common stock sold in this offering (including
pursuant to the underwriters&rsquo; exercise of their over-allotment option) will be freely tradable, except that any shares held
by our affiliates, as that term is defined in Rule 144 under the Securities Act, may only be sold in compliance with the limitations
described below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The remaining shares
of our common stock outstanding after this offering are restricted securities, as that term is defined in Rule 144 under the Securities
Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Rule 144.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In general, persons
who have beneficially owned restricted shares of our common stock for at least six months, and any affiliate of ours who owns either
restricted or unrestricted shares of our common stock, are entitled to sell their securities without registration with the SEC
under an exemption from registration provided by Rule 144 under the Securities Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In general, a person
who has beneficially owned restricted shares of our common stock for at least six months would be entitled to sell their securities
provided that (i) such person is not deemed to have been one of our affiliates at the time of, or at any time during the 90 days
preceding, a sale and (ii) we have been subject to the Exchange Act periodic reporting requirements for at least 90 days before
the sale. Persons who have beneficially owned restricted shares of our common stock for at least six months, but who are our affiliates
at the time of, or any time during the 90 days preceding, a sale, would be subject to additional restrictions, by which such person
would be entitled to sell within any three-month period only a number of securities that does not exceed the greater of either
of the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">1% of the number of shares of our common stock then outstanding, which will equal approximately
shares immediately after the closing of this offering based on the number of shares of our common stock outstanding as of , 2017
and assuming no exercise of the underwriters&rsquo; over-allotment option; or</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">the average weekly trading volume of our common stock on The Nasdaq Capital Market during the four
calendar weeks preceding the filing of a notice on Form 144 with respect to the sale;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">provided, in each case, that we have been
subject to the Exchange Act periodic reporting requirements for at least 90 days before the sale. Such sales both by affiliates
and by non-affiliates must also comply with the manner of sale, current public information and notice provisions of Rule 144.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Equity Incentive Plan</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have filed a Form
S-8 registration statement under the Securities Act to register shares of our common stock issued or reserved for issuance under
the Plan. Accordingly, the shares covered by such registration statement are eligible for sale in the public markets, subject to
vesting restrictions, and Rule 144 limitations applicable to affiliates.&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_075"></A>Underwriting</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Ladenburg Thalmann
&amp; Co. Inc. is acting as representative of the underwriters (the &ldquo;Representative&rdquo;). Subject to the terms and conditions
of an underwriting agreement between us and the Representative, we have agreed to sell to each underwriter named below, and each
underwriter named below has severally agreed to purchase, at the public offering price less the underwriting discounts set forth
on the cover page of this prospectus, the number of shares of common stock listed next to its name in the following table:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 81%; font-size: 10pt; font-weight: bold; padding-bottom: 1pt; border-bottom: Black 1pt solid">Name of Underwriter</TD><TD STYLE="width: 2%; font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 15%; border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: center"><B>Number of</B><BR> <B>Shares</B></TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Ladenburg Thalmann &amp; Co. Inc.</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">Total</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The underwriters are
committed to purchase all the shares of common stock offered by us if they purchase any shares of common stock. The underwriting
agreement also provides that if an underwriter defaults, the purchase commitments of non-defaulting underwriters may be increased
(subject to limitations) or the offering may be terminated. The underwriters are not obligated to purchase the shares of common
stock covered by the underwriters&rsquo; over-allotment option described below. The underwriters are offering the shares of common
stock, subject to prior sale, when, as and if issued to and accepted by them, subject to approval of legal matters by their counsel,
and other conditions contained in the underwriting agreement, such as the receipt by the underwriters of officer&rsquo;s certificates
and legal opinions. The underwriters reserve the right to withdraw, cancel or modify offers to the public and to reject orders
in whole or in part.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The underwriters have
advised us that they do not intend to confirm sales to any account over which they exercise discretionary authority.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Discounts and Commissions</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The underwriters propose
initially to offer the shares of common stock to the public at the public offering price set forth on the cover page of this prospectus
and to dealers at those prices less a concession not in excess of $ per share of common stock. If all of the shares of common stock
offered by us are not sold at the public offering price, the underwriters may change the offering price and other selling terms
by means of a supplement to this prospectus.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following table
shows the public offering price, underwriting discounts and commissions and proceeds before expenses to us. The information assumes
either no exercise or full exercise of the over-allotment option we granted to the Representatives of the underwriters. In addition
to the below, we have paid an initial engagement fee of $50,000 to the Representative.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Total</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Per Share</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Without<BR> Over-Allotment</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">With<BR> Over-Allotment</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 55%; font-size: 10pt">Public offering price</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right"></TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right"></TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right"></TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Underwriting discount (7%)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right"></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right"></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right"></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Proceeds, before expenses, to us</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right"></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right"></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right"></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have agreed to pay
an accountable expense allowance to the Representative of the underwriters for up to $100,000 of expenses incurred by the Representative
in connection with the offering. We have paid an expense deposit of $20,000 to the Representative, which will be applied against
the accountable expenses that will be paid by us to the underwriters in connection with this offering, and will be reimbursed to
us to the extent not actually incurred in compliance with FINRA Rule 5110(f)(2)(C).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The total estimated
expenses of the offering, including registration, filing and listing fees, printing fees and legal and accounting expenses, but
excluding underwriting discounts, commissions and expenses, are approximately $______ and are payable by us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Over-Allotment Option</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have granted a 30-day
option to the Representative of the underwriters to purchase up to ______ additional shares of our common stock at a public offering
price of $_____ per share, solely to cover over-allotments, if any. The underwriters may exercise this option for 30 days from
the date of this prospectus solely to cover sales of shares of common stock by the underwriters in excess of the total number of
shares of common stock set forth in the table above. If any of these additional shares are purchased, the underwriters will offer
the additional shares on the same terms as those on which the shares are being offered. We will pay the expenses associated with
the exercise of the over-allotment option.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Right of First Refusal</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Until twelve (12) months
from the effective date of this registration statement, the Representative shall have an irrevocable right of first refusal to
act as sole investment banker, sole book-runner, and/or sole placement agent, at the Representative&rsquo;s sole discretion, for
each and every future offering of our equity securities on terms customary to the Representative. The Representative shall have
the sole right to determine whether or not any other broker-dealer shall have the right to participate in any such offering and
the economic terms of any such participation. The Representative will not have more than one opportunity to waive or terminate
the right of first refusal in consideration of any payment or fee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Determination of Offering Price</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="font-weight: normal">Our shares
of common stock are currently quoted on the OTCQB Marketplace under the symbol &ldquo;AMRH.&rdquo; On September __, 2017, the closing
price of our common stock was $___ per share. We have applied for the listing of our common stock on the NASDAQ Capital Market
under the ticker symbol &ldquo;AMRH&rdquo; and will use our best efforts to have that listing effective on or before the closing.
No assurance can be given that such listing will be approved; however, it is a condition of the underwriters&rsquo; obligation
that our shares of common stock have been approved for listing on The Nasdaq Capital Market. There is no established public trading
market for our common stock and the share prices on an over-the-counter marketplace may not be indicative of the market price of
our common stock on the NASDAQ Capital Market. The public offering price of the securities offered by this prospectus will be determined
by negotiation between us and the Representative. Among the factors considered in determining the public offering price of the
shares were: </FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-weight: normal">&middot;</FONT></TD><TD><FONT STYLE="font-weight: normal">our history and our prospects; </FONT></TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-weight: normal">&middot;</FONT></TD><TD><FONT STYLE="font-weight: normal">the industry in which we operate; </FONT></TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-weight: normal">&middot;</FONT></TD><TD><FONT STYLE="font-weight: normal">our past and present operating results; </FONT></TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-weight: normal">&middot;</FONT></TD><TD><FONT STYLE="font-weight: normal">the previous experience of our executive officers; and </FONT></TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol; font-weight: normal">&middot;</FONT></TD><TD><FONT STYLE="font-weight: normal">the general condition of the securities markets at the time of this offering.</FONT></TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="font-weight: normal">The offering
price stated on the cover page of this prospectus should not be considered an indication of the actual value of our shares of common
stock. That price is subject to change as a result of market conditions and other factors, and we cannot assure you that our shares
of common stock can be resold at or above the public offering price.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Lock-up Agreements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our officers and directors
and LSVI and certain of its affiliated entities have agreed with the Representative to be subject to a lock-up period of 90 days
following the date of this prospectus. This means that, during the applicable lock-up period, such persons may not offer for sale,
contract to sell, sell, distribute, grant any option, right or warrant to purchase, pledge, hypothecate or otherwise dispose of,
directly or indirectly, any shares of our common stock or any securities convertible into, or exercisable or exchangeable for,
shares of our common stock. Certain limited transfers are permitted during the lock-up period if the transferee agrees to these
lock-up restrictions. We have also agreed, in the underwriting agreement, to similar lock-up restrictions on the issuance and sale
of our securities for 90 days following the closing of this offering, although we will be permitted to issue stock options or stock
awards to directors, officers and employees under our existing plans. The lock-up period is subject to an additional extension
to accommodate for our reports of financial results or material news releases. The Representative may, in its sole discretion and
without notice, waive the terms of any of these lock-up agreements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Indemnification</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have agreed to indemnify
the underwriters against certain liabilities that may be incurred in connection with this offering, including liabilities under
the Securities Act, and to contribute to payments that the underwriters may be required to make for these liabilities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Price Stabilization, Short Positions and Penalty Bids</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In order to facilitate
the offering of our securities, the underwriters may engage in transactions that stabilize, maintain or otherwise affect the price
of our securities. In connection with the offering, the underwriters may purchase and sell our securities in the open market. These
transactions may include short sales, purchases on the open market to cover positions created by short sales and stabilizing transactions.
Short sales involve the sale by the underwriters of a greater number of shares of securities than they are required to purchase
in the offering. &ldquo;Covered&rdquo; short sales are sales made in an amount not greater than the underwriters&rsquo; over-allotment
option. The underwriters may close out any covered short position by either exercising the over-allotment option or purchasing
shares of securities in the open market. In determining the source of shares of securities to close out the covered short position,
the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to
the price at which they may purchase shares through the over-allotment option. &ldquo;Naked&rdquo; short sales are sales in excess
of the over-allotment option. The underwriters must close out any naked short position by purchasing securities in the open market.
A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the
price of our securities in the open market after pricing that could adversely affect investors who purchase in the offering. Stabilizing
transactions consist of various bids for or purchases of shares of securities made by the underwriters in the open market before
the completion of the offering.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Similar to other purchase
transactions, the underwriters&rsquo; purchases to cover the syndicate short sales may have the effect of raising or maintaining
the market price of our securities or preventing or retarding a decline in the market price of our securities. As result, the price
of our securities may be higher than the price that might otherwise exist in the open market.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The underwriters have
advised us that, pursuant to Regulation M under the Exchange Act, they may also engage in other activities that stabilize, maintain
or otherwise affect the price of our securities, including the imposition of penalty bids. This means that if the Representative
of the underwriters purchases securities in the open market in stabilizing transactions or to cover short sales, the Representative
can require the underwriters that sold those shares as part of this offering to repay the underwriting discount received by them.
The underwriters make no representation or prediction as to the direction or magnitude of any effect that the transactions described
above may have on the price of our securities. In addition, neither we nor the underwriters make any representation that the underwriters
will engage in these transactions or that these transactions, once commenced, will not be discontinued without notice.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Electronic Offer, Sale and Distribution of Shares</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">A prospectus in electronic
format may be made available on the websites maintained by one or more underwriters or selling group members, if any, participating
in the offering. The underwriters may agree to allocate a number of shares of securities to underwriters and selling group members
for sale to their online brokerage account holders. Internet distributions will be allocated by the Representative to underwriters
and selling group members that may make internet distributions on the same basis as other allocations. Other than the prospectus
in electronic format, the information on the underwriters&rsquo; websites and any information contained in any other website maintained
by the underwriters is not part of this prospectus or the registration statement of which this prospectus forms a part.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Other Relationships</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">From time to time,
certain of the underwriters and their affiliates have provided, and may provide in the future, various advisory, investment and
commercial banking and other services to us in the ordinary course of business, for which they have received and may continue to
receive customary fees and commissions. However, except as disclosed in this prospectus, we have no present arrangements with any
of the underwriters for any further services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Transfer Agent and Registrar</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The transfer agent
and registrar for our common stock is Corporate Stock Transfer.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Offer Restrictions Outside the United States</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Other than in the United
States, no action has been taken by us or the underwriters that would permit a public offering of the securities offered by this
prospectus in any jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be
offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection
with the offer and sale of any such securities be distributed or published in any jurisdiction, except under circumstances that
will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus
comes are advised to inform themselves about and to observe any restrictions relating to the offering and the distribution of this
prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by
this prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in"><A NAME="a_079"></A>Legal
Matters</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The validity of the
securities offered hereby will be passed upon for us by Olshan Frome Wolosky LLP of New York, New York. Certain members of Olshan
Frome Wolosky LLP own securities of the Company. Certain legal matters in connection with this offering will be passed upon for
the underwriters by McGuireWoods LLP.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">Experts</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our audited condensed
consolidated financial statements as of December 31, 2016 and 2015 and for the years then ended, the audited consolidated financial
statements of Bellsoft, Inc. as of December 31, 2015 and 2014 and for the years then ended, the audited consolidated financial
statements of DC&amp;M Partners, L.L.C. as of December 31, 2015 and 2014 and for the years then ended, and the audited consolidated
financial statements of ATCG Technology Solutions, Inc. as of December 31, 2016 and 2015 and for the years then ended, are included
herein in reliance on the reports of Ram Associates, an independent registered public accounting firm, on the authority of said
firm as experts in auditing and accounting.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">Where
You Can Find More Information</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have filed with
the SEC a registration statement on Form S&minus;1 under the Securities Act with respect to the shares of common stock being offered
by this prospectus. This prospectus does not contain all of the information included in the registration statement. For further
information pertaining to us and our common stock you should refer to the registration statement and its exhibits. Statements contained
in this prospectus concerning any of our contracts, agreements or other documents are not necessarily complete. If a contract or
document has been filed as an exhibit to the registration statement, we refer you to the copy of the contract or document that
has been filed. Each statement in this prospectus relating to a contract or document filed as an exhibit is qualified in all respects
by the filed exhibit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We are subject to the
informational requirements of the Exchange Act and file annual, quarterly and current reports and other information with the SEC.
Our filings with the SEC are available to the public on the SEC&rsquo;s website at http://www.sec.gov. Those filings are also available
to the public on, or accessible through, our website under the heading &ldquo;Investors&rdquo; at www.ameri100.com. The information
we file with the SEC or contained on or accessible through our corporate website or any other website that we may maintain is not
part of this prospectus or the registration statement of which this prospectus is a part. You may also read and copy, at SEC prescribed
rates, any document we file with the SEC, including the registration statement (and its exhibits) of which this prospectus is a
part, at the SEC&rsquo;s Public Reference Room located at 100 F Street, N.E., Washington D.C. 20549. You can call the SEC at 1-800-SEC-0330
to obtain information on the operation of the Public Reference Room.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">INDEX TO CONSOLIDATED FINANCIAL STATEMENTS</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-right: 0; margin-bottom: 0pt; text-align: left"></P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 95%">&nbsp;</TD>
    <TD STYLE="width: 5%; text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><B>AMERI HOLDINGS, INC.</B></TD>
    <TD STYLE="text-align: center"><B>PAGE</B></TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>AUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: 10pt">AS OF DECEMBER 31, 2016 AND 2015 AND FOR THE YEARS THEN ENDED</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Report of Independent Registered Public Accounting Firm</TD>
    <TD STYLE="text-align: center">F-3</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Audited Condensed Consolidated Balance Sheets</TD>
    <TD STYLE="text-align: center">F-4</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Audited Condensed Consolidated Statements of Comprehensive Income (Loss)</TD>
    <TD STYLE="text-align: center">F-5</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Consolidated Statement of Changes in Stockholders&rsquo; Equity From March 31, 2015 to December 31, 2016</TD>
    <TD STYLE="text-align: center">F-6</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Audited Condensed Consolidated Statements of Cash Flows for the Years Ended December 31, 2016 and December 31, 2015</TD>
    <TD STYLE="text-align: center">F-7</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Notes to Audited Condensed Consolidated Financial Statements</TD>
    <TD STYLE="text-align: center">F-8</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD STYLE="text-indent: 10pt">FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2017</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Unaudited Condensed Consolidated Balance Sheets as of June 30, 2017 and December 31, 2016</TD>
    <TD STYLE="text-align: center">F-25</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three Months Ended June 30, 2017 and 2016 and for the Six Months Ended June 30, 2017 and 2016</TD>
    <TD STYLE="text-align: center">F-26</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Unaudited Condensed Consolidated Statements of Cash Flows as of June 30, 2017 and December 31, 2016</TD>
    <TD STYLE="text-align: center">F-27</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Notes to Unaudited Condensed Consolidated Financial Statements</TD>
    <TD STYLE="text-align: center">F-28</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><B>BELLSOFT, INC.</B></TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>AUDITED CONSOLIDATED FINANCIAL STATEMENTS</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD STYLE="text-indent: 10pt">AS OF DECEMBER 31, 2014 AND 2013 AND FOR THE YEARS THEN ENDED</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Report of Independent Registered Public Accounting Firm</TD>
    <TD STYLE="text-align: center">F-42</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Consolidated Balance Sheets</TD>
    <TD STYLE="text-align: center">F-43</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Consolidated Statements of Income and Comprehensive Income</TD>
    <TD STYLE="text-align: center">F-44</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Consolidated Statements of Changes in Shareholders&rsquo; Equity</TD>
    <TD STYLE="text-align: center">F-45</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Consolidated Statements of Cash Flows</TD>
    <TD STYLE="text-align: center">F-46</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Notes to Consolidated Financial Statements</TD>
    <TD STYLE="text-align: center">F-47</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: 10pt">FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2015</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Unaudited Condensed Consolidated Balance Sheets</TD>
    <TD STYLE="text-align: center">F-53</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Unaudited Condensed Consolidated Statements of Comprehensive Income</TD>
    <TD STYLE="text-align: center">F-54</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Unaudited Condensed Consolidated Statements of Cash Flows</TD>
    <TD STYLE="text-align: center">F-55</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Notes to Unaudited Condensed Consolidated Financial Statements</TD>
    <TD STYLE="text-align: center">F-56</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD><B>DC&amp;M PARTNERS, L.L.C.</B></TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>AUDITED CONSOLIDATED FINANCIAL STATEMENTS</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD STYLE="text-indent: 10pt">AS OF DECEMBER 31, 2015 AND 2014 AND FOR THE YEARS THEN ENDED</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Report of Independent Registered Public Accounting Firm</TD>
    <TD STYLE="text-align: center">F-64</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Balance Sheets</TD>
    <TD STYLE="text-align: center">F-65</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Statements of Income and Comprehensive Income</TD>
    <TD STYLE="text-align: center">F-66</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Statements of Changes in Members&rsquo; Equity</TD>
    <TD STYLE="text-align: center">F-67</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Statements of Cash Flows</TD>
    <TD STYLE="text-align: center">F-68</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Notes to Financial Statements</TD>
    <TD STYLE="text-align: center">F-69</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>UNAUDITED CONDENSED FINANCIAL STATEMENTS</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD STYLE="text-indent: 10pt">FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2015</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Unaudited Condensed Balance Sheets for the Six Months Ended June 30, 2015 and 2016</TD>
    <TD STYLE="text-align: center">F-73</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top; background-color: White">
    <TD STYLE="width: 95%">Unaudited Condensed Statements of Income and Comprehensive Income for the Three and Six Months Ended June 30, 2015 and 2016</TD>
    <TD STYLE="text-align: center; width: 5%">F-74</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Unaudited Condensed Statements of Cash Flows for the Six Months Ended June 30, 2015 and 2016</TD>
    <TD STYLE="text-align: center">F-75</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Notes to Unaudited Condensed Financial Statements</TD>
    <TD STYLE="text-align: center">F-76</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS</TD>
    <TD STYLE="text-align: center">F-81</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Unaudited Pro Forma Combined Statement of Operations For the Year Ended December 31, 2016</TD>
    <TD STYLE="text-align: center">F-82</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Notes to Unaudited Pro Forma Combined Financial Statements</TD>
    <TD STYLE="text-align: center">F-83</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD><B>ATCG TECHNOLOGY SOLUTIONS, INC.</B></TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>AUDITED CONSOLIDATED FINANCIAL STATEMENTS</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD STYLE="text-indent: 10pt">AS OF DECEMBER 31, 2016 AND 2015 AND FOR THE YEARS THEN ENDED</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Report of Independent Registered Public Accounting Firm</TD>
    <TD STYLE="text-align: center">F-84</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Balance Sheets</TD>
    <TD STYLE="text-align: center">F-85</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Statements of Income and Comprehensive Income</TD>
    <TD STYLE="text-align: center">F-86</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Statements of Changes in Stockholders&rsquo; Equity</TD>
    <TD STYLE="text-align: center">F-87</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Statements of Cash Flows</TD>
    <TD STYLE="text-align: center">F-88</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Notes to Financial Statements</TD>
    <TD STYLE="text-align: center">F-89</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: center">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS</TD>
    <TD STYLE="text-align: center">F-94</TD></TR>
<TR STYLE="vertical-align: top; background-color: rgb(204,238,255)">
    <TD>Unaudited Pro Forma Combined Statement of Operations For the Year Ended December 31, 2016</TD>
    <TD STYLE="text-align: center">F-95</TD></TR>
<TR STYLE="vertical-align: top; background-color: White">
    <TD>Notes to Unaudited Pro Forma Combined Financial Statements</TD>
    <TD STYLE="text-align: center">F-96</TD></TR>
</TABLE>


<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-right: 0; margin-bottom: 0pt; text-align: left">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-right: 0; margin-bottom: 0pt; text-align: left"></P>

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<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-right: 0; margin-bottom: 0pt; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B><U>REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM</U></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Board of Directors and Stockholders</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">AMERI Holdings, Inc.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We have audited the accompanying consolidated
balance sheets of AMERI Holdings, Inc. (the &quot;Company&quot;) as of December 31, 2016 and 2015 and the related consolidated
statements of operations, comprehensive income (loss), stockholders' equity and cash flows for each of the two years in the period
ended December 31, 2016 and 2015. AMERI Holdings, Inc.'s management is responsible for these financial statements. Our responsibility
is to express an opinion on these consolidated financial statements based on our audits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the consolidated 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 audits provide a reasonable basis for our opinion.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In our opinion, the consolidated financial
statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31,
2016 and 2015 and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2016
and 2015, in conformity with accounting principles generally accepted in the United States of America.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">/s/ Ram Associates</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Ram Associates</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Hamilton, NJ</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">March 30, 2017</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>AMERI HOLDINGS, INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>AUDITED CONDENSED CONSOLIDATED BALANCE
SHEETS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2016</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2015</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="9" STYLE="font-size: 10pt; font-weight: bold">Assets</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Current assets:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">Cash and cash equivalents</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,379,887</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,878,034</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Accounts receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,059,910</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,872,082</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Investments</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">82,908</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">82,908</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Other current assets</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">542,237</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">343,809</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Total current assets</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">10,064,942</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">7,176,833</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Other assets:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Property and equipment, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">100,241</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">73,066</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Intangible assets, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,764,704</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,114,513</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Acquired goodwill</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">17,089,076</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,470,522</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Deferred income tax assets, net</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,488,960</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Total other assets</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">29,442,981</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">6,658,101</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Total assets</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">39,507,923</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">13,834,934</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Liabilities and Stockholders' Equity</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Current liabilities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Line of credit</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,088,890</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,235,935</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Accounts payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,130,817</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,597,385</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Other accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,165,088</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,093,814</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Current Portion - Long Term Notes</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">405,376</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Consideration payable &ndash; Cash</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,854,397</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,649,267</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Consideration payable &ndash; Equity</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">64,384</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Total current liabilities</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">12,708,952</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">8,576,401</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Long term liabilities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Convertible notes</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,000,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Long-term notes &ndash; Net of Current Portion</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,536,191</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Long-term consideration payable &ndash; Cash</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,711,717</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Long-term consideration payable &ndash; Equity</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">10,887,360</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Total Long-term Liabilities</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">15,135,268</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">5,000,000</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Total liabilities</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">27,844,220</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">13,576,401</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Stockholders' equity:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">Preferred stock, $0.01 par value; 1,000,000 authorized, 363,611 issued and outstanding as of December 31, 2016, and none outstanding as of December 31, 2015</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,636</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Common stock, $0.01 par value; 100,000,000 shares authorized, 13,885,972 and 11,874,361 issued and outstanding as of December 31, 2016, and December 31, 2015, respectively</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">138,860</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">118,743</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Additional paid-in capital</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">15,358,839</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,192,692</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Accumulated deficit</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,833,588</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,052,902</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Accumulated other comprehensive income (loss)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(7,426</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Non-Controlling Interest</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,382</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Total stockholders' equity</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">11,663,703</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">258,533</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Total liabilities and stockholders' equity</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">39,507,923</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">13,834,934</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See notes to the audited condensed consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>AMERI HOLDINGS, INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>AUDITED CONDENSED CONSOLIDATED STATEMENTS
OF COMPREHENSIVE INCOME (LOSS)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: center">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Twelve Months</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ended</B>&nbsp;</P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31,</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; font-weight: bold; text-align: left">Net revenue</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">36,145,589</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">20,261,172</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">Cost of revenue</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">29,608,932</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">13,391,504</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Gross profit</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">6,536,657</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">6,869,668</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Operating expenses:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Selling and marketing</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">417,249</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">119,847</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">General and administration</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,552,966</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,721,633</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Acquisition related expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,585,136</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,655,962</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Depreciation and amortization</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,361,169</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">166,208</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Operating expenses</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">11,916,520</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">7,663,650</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Operating income (loss):</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(5,379,863</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(793,982</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Interest expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(751,074</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(238,471</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Interest income/other income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">89,918</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Other income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">16,604</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Change due to estimate correction</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(410,817</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Total other income (expenses)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(1,145,287</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(148,553</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net income (loss)&nbsp;before income taxes</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(6,525,150</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(942,535</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Income&nbsp;tax benefit (provision)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,747,846</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">128,460</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net income (loss)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,777,304</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(814,075</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;&nbsp;&nbsp;Non-controlling interest</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,382</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Net income (loss) attributable to the Company</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(2,780,686</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(814,075</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Foreign exchange translation&nbsp;adjustment</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(7,426</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Comprehensive&nbsp;income (loss)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(2,788,112</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(814,075</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">Basic income (loss) per share</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(0.21</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(0.07</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">Diluted income (loss) per share</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(0.21</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(0.07</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">Basic weighted average number of shares</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">13,068,597</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">11,101,198</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">Diluted weighted average number of shares</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">13,068,597</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">11,101,198</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><BR></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See notes to the audited condensed consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 99%; text-align: center"><B>AMERI HOLDINGS, INC.</B></TD>
    <TD STYLE="width: 1%">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center"><B>CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY</B></TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center"><P STYLE="margin-top: 0; margin-bottom: 0"><B>FROM MARCH 31, 2015 TO DECEMBER 31, 2016</B>&nbsp;</P></TD>
    <TD>&nbsp;</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font-size: 10pt">
<TR>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font-size: 8pt"><B>Common
    Stock</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font-size: 8pt"><B>Preferred
    Stock</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font-size: 8pt">Shares</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font-size: 8pt">Par
    Value at $0.01</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font-size: 8pt">Shares</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font-size: 8pt">Par
    Value at $0.01</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">Additional&nbsp;</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">paid-in</FONT>&nbsp;</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">capital</FONT></P></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">Other</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">Comprehensive
income (loss)</FONT></P></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">Accumulated</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">deficit</FONT></P></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: center"><FONT STYLE="font-size: 8pt">Non-Controlling
    Interests</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">Total</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">stockholders'</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">equity</FONT></P></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt"><B>Balance at March 31, 2015</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>9,992,828</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>99,928</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>-</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>35,072</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>-</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>837,856</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top; border-bottom: Black 1pt solid"></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>972,856</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">Issuance of capital for services</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">566,487</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">5,665</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">49,460</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">55,125</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">Issuance of capital for board services</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">203,935</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">2,039</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">2,039</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">Recapitalization on May 26, 2015</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">875,816</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">8,758</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">(31,401</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">)</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">(22,643</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">Issuance of shares for acquisition</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">235,295</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">2,353</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">997,651</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">1,000,004</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">Equity adjustments for business combinations</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">Stock, Option, RSU and Warrant Expense</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">141,910</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">141,910</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">Net Loss</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">(1,890,758</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">)</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">(1,890,758</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt"><B>Balance at December 31, 2015</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>11,874,361</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>118,743</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>-</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>1,192,692</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>-</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>(1,052,902</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>)</B></FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>258,533</B></FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">Common stock issued</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">500,000</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">5,000</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">2,995,000</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">3,000,000</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">Conversion of notes into preferred shares</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">363,611</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">$</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">3,636</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">5,121,364</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">5,125,000</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">Conversion of warrants into common shares</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">1,111,111</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">11,111</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">1,988,889</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">2,000,000</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">Issuance of shares for acquisition</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">400,500</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">4,006</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">2,603,247</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">2,607,253</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">Stock, Option, RSU and Warrant Expense</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">1,457,647</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="3" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">1,457,647</FONT></TD>
    <TD NOWRAP STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="width: 28%"><FONT STYLE="font-size: 8pt">Non-Controlling Interests Net Income</FONT></TD>
    <TD STYLE="width: 2%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">3,382</FONT></TD>
    <TD NOWRAP STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">3,382</FONT></TD>
    <TD NOWRAP STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 8pt">Accumulated other comprehensive income (loss)</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(7,426</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">)</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(7,426</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD><FONT STYLE="font-size: 8pt">Net Loss</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">(2,780,686</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">)</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt">(2,780,686</FONT></TD>
    <TD NOWRAP STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD><FONT STYLE="font-size: 8pt"><B>Balance at December 31, 2016</B></FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>13,885,972</B></FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>138,860</B></FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>363,611</B></FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>3,636</B></FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>15,358,839</B></FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>(7,426</B></FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt"><B>)</B></FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>(3,833,588</B></FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt"><B>)</B></FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>3,382</B></FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: Black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>11,663,703</B></FONT></TD>
    <TD NOWRAP><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See notes to the audited condensed consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;<B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>AMERI HOLDINGS, INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>AUDITED CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>FOR&nbsp;THE&nbsp;YEARS ENDED DECEMBER
31, 2016 AND 2015</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Twelve Months</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ended</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31,</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Cash flow from operating activities</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">&nbsp;&nbsp;Net income/(loss)</TD><TD STYLE="width: 2%; font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; font-weight: bold; text-align: right">(2,780,686</TD><TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="width: 2%; font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; font-weight: bold; text-align: right">(814,075</TD><TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;&nbsp;Adjustment to reconcile income/(loss) to net cash used in operating activities</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,361,169</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">166,284</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;&nbsp;&nbsp;Provision for doubtful debts/ (written back), net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">410,712</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest on convertible notes</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">125,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;&nbsp;&nbsp;Change due to estimate correction</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">410,817</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;&nbsp;&nbsp;Stock, option, restricted stock unit and warrant expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,457,647</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">141,910</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;&nbsp;&nbsp;Deferred income taxes, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,488,960</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;&nbsp;&nbsp;Foreign exchange translation adjustment</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(7,426</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Changes in assets and liabilities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Increase (decrease) in:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;Accounts receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,187,828</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(643,873</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;Other current assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(198,428</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(169,549</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Increase (decrease) in:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;Accounts payable and accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,604,706</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(89,586</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Net cash used in&nbsp;operating activities</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(2,703,989</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(998,177</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Cash flow from investing activities</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;Purchase of fixed assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(29,062</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(70,782</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;Acquisition consideration</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(6,563,000</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(4,670,000</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Net cash used in investing activities</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(6,592,062</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(4,740,782</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Cash flow from financing activities</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;Proceeds from loan funds</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,794,522</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">6,235,935</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;Non-Controlling Interests Net Income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,382</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">&nbsp;&nbsp;Additional stock issued</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,000,000</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Net cash provided by financing activities</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">8,797,904</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">6,235,935</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net increase (decrease) in cash and cash equivalents</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(498,147</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">496,976</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Cash and cash equivalents as at beginning of the year</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">1,878,034</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">1,381,058</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Cash at the end of the year</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">1,379,887</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">1,878,034</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font-size: 10pt">
<TR>
    <TD STYLE="vertical-align: top"><B>SUPPLEMENTAL DISCLOSURES:</B></TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD NOWRAP STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD NOWRAP STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: top">&nbsp;&nbsp;&nbsp;Cash paid during the period for:</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD NOWRAP STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD NOWRAP STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: top; width: 78%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">$</TD>
    <TD STYLE="vertical-align: bottom; width: 8%; text-align: right">362,792</TD>
    <TD NOWRAP STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; width: 1%">$</TD>
    <TD STYLE="vertical-align: bottom; width: 8%; text-align: right">238,471</TD>
    <TD NOWRAP STYLE="vertical-align: bottom; width: 1%">&nbsp;</TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: top">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Taxes</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">$</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">-</TD>
    <TD NOWRAP STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">$</TD>
    <TD STYLE="vertical-align: bottom; text-align: right">-</TD>
    <TD NOWRAP STYLE="vertical-align: bottom">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See notes to the audited condensed consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>AMERI HOLDINGS, INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>NOTES TO AUDITED CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>DECEMBER 31, 2016</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;<B>NOTE 1. &nbsp;&nbsp;&nbsp;ORGANIZATION:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">AMERI Holdings, Inc. (&quot;AMERI&quot;,
the &quot;Company&quot;, &quot;we&quot; or &quot;our&quot;) is a fast-growing company that, through the operations of its twelve
subsidiaries, provides SAP cloud, digital and enterprise services to clients worldwide.&nbsp;Headquartered in Princeton, New Jersey,
we typically go to market both vertically by industry and horizontally by product/technology specialties and provide our customers
with a wide range of business and technology offerings. We work with customers, primarily within North America, to improve process,
reduce costs and increase revenue through the judicious use of technology.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 2. &nbsp;&nbsp;&nbsp;BASIS OF PRESENTATION:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The accompanying audited condensed consolidated
financial statements have been prepared by AMERI pursuant to the rules and regulations of the Securities and Exchange Commission
(the &quot;SEC&quot;) regarding annual financial reporting. Certain information and note disclosures normally included in annual
financial statements prepared in accordance with accounting principles generally accepted in the United States of America have
been omitted pursuant to those rules and regulations, although we believe that the disclosures made are adequate to ensure the
information presented is not misleading.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The accompanying audited condensed consolidated
financial statements reflect all adjustments (which were of a normal, recurring nature) that, in the opinion of management, are
necessary to present fairly our financial position, results of operations and cash flows as of and for the interim periods presented.
All intercompany transactions have been eliminated in the accompanying audited condensed consolidated financial statements. These
financial statements should be read in conjunction with the audited financial statements and notes thereto.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Our comprehensive income (loss) consists
of net income (loss) plus or minus any periodic currency translation adjustments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company's year-end is December 31.
Ameri and Partners Inc, the Company's wholly-owned operating subsidiary that was the accounting acquirer in connection with the
Company's May 2015 reverse merger, changed its fiscal year end from March 31 to December 31 pursuant to the merger, so that all
of the Company's subsidiaries' year-ends are consistent with the year-end of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has reclassified cash paid
for its Bellsoft acquisition in 2015 from operating activities to investing activities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 3. &nbsp;&nbsp;&nbsp;BUSINESS COMBINATIONS:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Acquisition of Bellsoft, Inc. </I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On November 20, 2015, we completed the
acquisition of Bellsoft, Inc., a consulting company based in Lawrenceville, Georgia with over 175 consultants specialized in the
areas of SAP software, business intelligence, data warehousing and other enterprise resource planning services. Following the acquisition,
the name of Bellsoft, Inc. was changed to Ameri100 Georgia Inc. (&ldquo;Ameri Georgia&rdquo;). Ameri Georgia has operations in
the United States, Canada and India. For financial accounting purposes, we recognized September 1, 2015 as the effective date of
the acquisition. The total consideration for the acquisition of Ameri Georgia was $9,910,817, consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(a)</TD><TD STYLE="text-align: justify">A cash payment in the amount of $3,000,000, which was
paid at closing;</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(b)</TD><TD STYLE="text-align: justify">235,295 shares of our common stock issued at closing,
valued at approximately $1,000,000 based on the closing price of our common stock on the closing date of the acquisition;</TD>
</TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(c)</TD><TD STYLE="text-align: justify">$250,000 quarterly cash payments paid on the last day
of each calendar quarter of 2016;</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(d)</TD><TD STYLE="text-align: justify">$1,000,000 cash reimbursement paid to compensate Ameri
Georgia for a portion of its &#9;approximate cash balance as of September 1, 2015;</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(e)</TD><TD STYLE="text-align: justify">$2,910,817 was paid in connection with the excess of
Ameri Georgia&rsquo;s accounts receivable over &#9;its accounts payable as of September 1, 2015; and</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(f)</TD><TD STYLE="text-align: justify">Earn-out payments of approximately $500,000 a year for
2016 and 2017, if earned through the &#9;achievement of annual revenue and earnings before interest taxes, depreciation and amortization
&#9;(&ldquo;EBITDA&rdquo;) targets specified in the purchase agreement, subject to downward or upward &#9;adjustment depending
on actual results. We estimate the earn-out payments to be earned at 100% &#9;of the targets set forth in the purchase agreement.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The earn-out for 2016 was 30% higher than
the previously agreed targets, resulting in a higher than anticipated earn-out payment, and the excess of the 2016 earn-out payment
over what was planned was made as an adjustment to our income statement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The valuation of Ameri Georgia was made
on the basis of its projected revenues. The accounting acquisition date for Ameri Georgia was determined on the basis of the date
when the Company acquired control of Ameri Georgia, in accordance with FASB codification ASU 805-10-25-6 for business combinations.
That ASU provides that the date on which the acquirer obtains control of the acquiree generally is the date on which the acquirer
legally transfers the consideration, acquires the assets, and assumes the liabilities of the acquiree&mdash;the closing date. However,
the acquirer might obtain control on a date that is either earlier or later than the closing date. For example, the acquisition
date precedes the closing date if a written agreement provides that the acquirer obtains control of the acquiree on a date before
the closing date. An acquirer shall consider all pertinent facts and circumstances in identifying the acquisition date. The term
sheet and the Share Purchase Agreement that were entered into by the Company and Ameri Georgia contained agreements by the parties
that the Company acquired control of Ameri Georgia&rsquo;s accounts payable, accounts receivable and business decisions as of September
1, 2015. In addition, on that date, the Company became responsible for performance of Ameri Georgia&rsquo;s existing contracts.
Accordingly, the Company has recognized September 1, 2015 as the accounting acquisition date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The total purchase price of $9,910,817
was allocated to net working capital of $4.6 million, intangibles of $1.8 million, taking into consideration projected revenue
from the acquired list of Ameri Georgia customers over a period of three years, and the balance was allocated to goodwill.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">For this acquisition, the net cash outflow
in 2016 was $2,330,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Acquisition of Bigtech Software Private
Limited </I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On June 23, 2016, we entered into a definitive
agreement to purchase Bigtech Software Private Limited (&ldquo;Bigtech&rdquo;), a pure-play SAP services company providing a wide
range of SAP services including turnkey implementations, application management, training and basis ABAP support. Based in Bangalore,
India, Bigtech offers SAP services to improve business operations at companies of all sizes and verticals. The acquisition of Bigtech
was effective as of July 1, 2016, and the total consideration for the acquisition of Bigtech was $850,000, consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(a)</TD><TD STYLE="text-align: justify">A cash payment in the amount of $340,000 which was due
within 90 days of closing and was paid &#9;on September 22, 2016;</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(b)</TD><TD STYLE="text-align: justify">Warrants for the purchase of 51,000 shares of our common
stock (valued at approximately $250,000 based on the $6.51 closing price of our common stock on the closing date of the acquisition),
with such warrants exercisable for two years; and</TD>
</TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(c)</TD><TD STYLE="text-align: justify">$255,000, which may become payable in cash earn-outs
to the sellers of Bigtech, if Bigtech &#9;achieves certain pre-determined revenue and EBITDA targets in 2017 and 2018. We estimate
&#9;the earn-out payments to be earned at 100% &#9;of the targets set forth in the purchase agreement.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Bigtech&rsquo;s financial results are included
in our condensed consolidated financial results starting July 1, 2016. The Bigtech acquisition did not constitute a significant
acquisition for the Company. The valuation of Bigtech was made on the basis of its projected revenues.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The total purchase price of $850,000 was
allocated to intangibles of $595,000, taking into consideration projected revenue from the acquired list of Bigtech customers over
a period of three years, and the balance was allocated to goodwill. The Bigtech acquisition did not constitute a significant acquisition
for the Company</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">For this acquisition, the net cash outflow
in 2016 was $340,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Acquisition of Virtuoso </I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On July 22, 2016, we, through wholly-owned
acquisition subsidiaries, acquired all of the outstanding membership interests of Virtuoso, L.L.C. (&ldquo;Virtuoso&rdquo;), a
Kansas limited liability company, pursuant to the terms of an Agreement of Merger and Plan of Reorganization, by and among us,
Virtuoso Acquisition Inc., Ameri100 Virtuoso Inc., Virtuoso and the sole member of Virtuoso (the &ldquo;Sole Member&rdquo;). Virtuoso
is a SAP consulting firm specialized in providing services on SAP S/4 HANA finance, enterprise mobility and cloud migration and
is based in Leawood, Kansas. In connection with the merger, Virtuoso&rsquo;s name was changed to Ameri100 Virtuoso Inc. The Virtuoso
acquisition did not constitute a significant acquisition for the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The total purchase price paid to the Sole
Member for the acquisition of Virtuoso was $1,831,881, consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(a)</TD><TD STYLE="text-align: justify">A cash payment in the amount of $675,000 was due within
90 days of closing;</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(b)</TD><TD STYLE="text-align: justify">101,250 shares of our common stock at closing, valued
at approximately $700,000 based on the &#9;$6.51 closing price of our common stock on the closing date of the acquisition; and</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(c)</TD><TD STYLE="text-align: justify">Earn-out payments in cash and stock of $450,000 and
approximately $560,807, respectively, to be paid, if earned, through the achievement of annual revenue and gross margin targets
in 2017, 2018 and 2019. Out of the total contingent consideration of approximately $1,000,000, the Company only considered 50%
of the earn-out in the purchase price, mainly due to the reorganization of Virtuoso. The Virtuoso earn-out payments for 2016 amounted
to $64,736 in cash and 12,408 shares of common stock as compared to the potential earn-out of $231,968 under the purchase agreement.</TD>
</TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The total purchase price of $1,831,881
was allocated to intangibles of $0.9 million, taking into consideration projected revenue from the acquired list of Virtuoso customers
over a period of three years, and the balance was allocated to goodwill.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">For this acquisition, the net cash outflow
in 2016 was $563,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Acquisition of DC&amp;M </I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On July 29, 2016, we acquired 100% of the
membership interests of DC&amp;M Partners, L.L.C. (&ldquo;DCM&rdquo;), an Arizona limited liability company, pursuant to the terms
of a Membership Interest Purchase Agreement by and among us, DCM, all of the members of DCM, Giri Devanur and Srinidhi &ldquo;Dev&rdquo;
Devanur, our President and Chief Executive Officer and Executive Vice Chairman, respectively. DCM is a SAP consulting company headquartered
in Chandler, Arizona. DCM provides its clients with a wide range of information technology development, consultancy and management
services with an emphasis on the design, build and rollout of SAP implementations and related products. DCM is also a SAP-certified
software partner, having launched its SAP reporting, extraction and distribution tool called &ldquo;IRIS&rdquo;. DCM services clients
in diverse industries, including retail, apparel/footwear, third-party logistics providers, chemicals, consumer goods, energy,
high-tech electronics, media/entertainment and aerospace.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The aggregate purchase price for the acquisition
of DCM was $15,816,000, consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(a)</TD><TD STYLE="text-align: justify">A cash payment in the amount of $3,000,000 at closing;</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(b)</TD><TD STYLE="text-align: justify">1,600,000 shares of our common stock (valued at approximately
$10.4 million based on the $6.51 closing price of our common stock on the closing date of the acquisition), which are to be issued
on July 29, 2018 or upon a change &#9;of control of our company (whichever occurs earlier); and</TD>
</TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(c)</TD><TD STYLE="text-align: justify">Earn-out payments of $1,500,000 payable in cash each
year to be paid, if earned, through the &#9;achievement of annual revenue and gross margin targets in 2017 and 2018. We estimate
the earn-&#9;out payments will be earned at 100% of the targets set forth in the purchase agreement.</TD>
</TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 0.5in; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The total purchase price of $15,816,000
was allocated to intangibles of $5.4 million, taking into consideration projected revenue from the acquired list of DCM customers
over a period of three years, and the balance was allocated to goodwill. For this acquisition, the net cash outflow in 2016 was
$3,000,000.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>Acquisition of Linear Logics, Corp.
</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In April 2015, the Company purchased all
of the assets and liabilities of Linear Logics, Corp. for approximately $1 million, which was to be paid in cash and Company stock.
In 2016, the Company paid $330,000 in cash toward the payment of the purchase price.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Presented below is the summary of the foregoing
acquisitions:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="2" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP COLSPAN="5" STYLE="text-align: center"><B>Allocation of purchase price in millions of U.S. dollars</B></TD></TR>
<TR>
    <TD STYLE="width: 48%; border: Black 1pt solid; text-align: center"><B>Asset Component</B></TD>
    <TD STYLE="width: 13%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center"><B>Ameri Georgia</B></TD>
    <TD STYLE="width: 13%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center"><B>Bigtech </B></TD>
    <TD STYLE="width: 13%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center"><B>Virtuoso</B></TD>
    <TD STYLE="width: 13%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center"><B>DCM</B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid">Intangible Assets</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.8 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.6 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.9 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid">Goodwill</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.5 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.3 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.9 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid"><B><U>Working Capital</U></B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10.05pt"><B>Current Assets</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 20pt">Cash</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 20pt">Accounts Receivable</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.6 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 20pt">Other Assets</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.2 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3 </TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10.05pt"><B>Current Liabilities</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 20pt">Accounts Payable</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 20pt">Accrued Expenses &amp; Other Current Liabilities</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10pt">&nbsp;</TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.7 </TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid"><B>Net Working Capital Acquired</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6 </TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-&nbsp;&nbsp;&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border: Black 1pt solid"><B>Total Purchase Price</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.9 </B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.9 </B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.8 </B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.8 </B></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The table below sets forth revenue and
earnings information for each of our recent acquisitions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="2" ALIGN="CENTER" STYLE="width: 80%; border-collapse: collapse; font-size: 10pt">
<TR>
    <TD COLSPAN="5" STYLE="border: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Revenue and Earnings of Acquisitions</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>since the date of acquisition (in millions
        of U.S. dollars)</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P></TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom; width: 32%; border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 17%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; text-align: center"><B>Ameri Georgia </B></TD>
    <TD STYLE="width: 17%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; text-align: center"><B>Bigtech</B></TD>
    <TD STYLE="width: 17%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; text-align: center"><B>Virtuoso</B></TD>
    <TD STYLE="width: 17%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; text-align: center"><B>DCM</B></TD></TR>
<TR STYLE="background-color: rgb(204,238,255)">
    <TD STYLE="vertical-align: bottom; border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">Year of acquisition</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>2015</B></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>2016</B></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>2016</B></TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>2016</B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">Revenue</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.6 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.5 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.7 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">Earnings</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.0 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.0 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.2 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.3 </TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">The tables below
set forth supplemental pro forma revenue and earnings information with respect to our 2016 acquisitions as if the applicable acquisition
was made as of the first day of the period presented. The Company&rsquo;s 2016 acquisition of Bigtech is omitted from the pro form
information below, as Bigtech did not constitute a material acquisition for the Company and its impact on the revenue and earnings
of the Company are not material.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="2" ALIGN="CENTER" STYLE="width: 80%; border-collapse: collapse; font-size: 10pt">
<TR>
    <TD COLSPAN="5" STYLE="border: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Supplemental Pro Forma Information
of Acquired Entities of </B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ameri Holdings, Inc. for the
Year Ended December 31, 2016 </B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>(in millions of U.S. dollars)</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P></TD></TR>
<TR>
    <TD STYLE="width: 17%; border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="width: 32%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; text-align: center"><B>Ameri Holdings, Inc.</B></TD>
    <TD STYLE="width: 17%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; text-align: center"><B>Virtuoso</B></TD>
    <TD STYLE="width: 17%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; text-align: center"><B>DCM</B></TD>
    <TD STYLE="width: 17%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; text-align: center"><B>Total</B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">Revenue</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;36.1 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.4 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;50.0 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">Earnings</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2.8) </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.1 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.0 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1.7) </TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="2" ALIGN="CENTER" STYLE="width: 80%; border-collapse: collapse; font-size: 10pt">
<TR>
    <TD COLSPAN="5" STYLE="border: Black 1pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Supplemental Pro Forma Information
of Acquired Entities of </B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ameri Holdings, Inc. for the
Year Ended December 31, 2015 </B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>(in millions of U.S. dollars)</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P></TD></TR>
<TR>
    <TD STYLE="width: 17%; border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid; text-align: right">&nbsp;</TD>
    <TD STYLE="width: 32%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; text-align: center"><B>Ameri Holdings, Inc.</B></TD>
    <TD STYLE="width: 17%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; text-align: center"><B>Virtuoso</B></TD>
    <TD STYLE="width: 17%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; text-align: center"><B>DCM</B></TD>
    <TD STYLE="width: 17%; border-bottom: Black 1pt solid; border-right: Black 1pt solid; text-align: center"><B>Total</B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">Revenue</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;20.3 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.9 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;41.4 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid">Earnings</TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(0.8) </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.4 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 </TD>
    <TD STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;0.7 </TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B></B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 4. &nbsp;&nbsp;&nbsp;REVENUE RECOGNITION:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company recognizes revenue primarily
through the provision of consulting services. We generate revenue by providing consulting services under written service contracts
with our customers. The service contracts we enter generally fall into two categories: (1) time-and-materials contracts and (2)
fixed-price contracts.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We consider amounts to be earned once evidence
of an arrangement has been obtained, services are delivered, fees are fixed or determinable and collectability is reasonably assured.
We establish billing terms at the time at which the project deliverables and milestones are agreed. Our standard payment terms
are 60 days from invoice date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">When a customer enters into a time-and-materials
or fixed-price (or a periodic retainer-based) contract, the Company recognizes revenue in accordance with its evaluation of the
deliverables in each contract. If the deliverables represent separate units of accounting, the Company then measures and allocates
the consideration from the arrangement to the separate units, based on vendor specific objective evidence of the value for each
deliverable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The revenue under time and materials contracts
is recognized as services are rendered and performed at contractually agreed upon rates. Revenue pursuant to fixed-price contracts
is recognized under the proportional performance method of accounting. We routinely evaluate whether revenue and profitability
should be recognized in the current period. We estimate the proportional performance on our fixed-price contracts on a monthly
basis utilizing hours incurred to date as a percentage of total estimated hours to complete the project. This method is used because
reasonably dependable estimates of costs and revenue earned can be made, based on historical experience and milestones identified
in any particular contract. If we do not have a sufficient basis to measure progress toward completion, revenue is recognized upon
completion of performance, subject to any warranty provisions or other project management assessments as to the status of work
performed.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Estimates of total project costs are continuously
monitored during the term of an engagement. There are situations where the number of hours to complete projects may exceed our
original estimate, as a result of an increase in project scope, unforeseen events that arise, or the inability of the client or
the delivery team to fulfill their responsibilities. Accordingly, recorded revenues and costs are subject to revision throughout
the life of a project based on current information and historical trends. Such revisions may result in increases or decreases to
revenue and income and are reflected in the consolidated financial statements in the periods in which they are first identified.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">If our initial estimates of the resources
required or the scope of work to be performed on a contract are inaccurate, or we do not manage the project properly within the
planned time period, a provision for estimated losses on incomplete projects may be made. Any known or probable losses on projects
are charged to operations in the period in which such losses are determined. A formal project review process takes place quarterly,
although projects are continuously evaluated throughout the period. Management reviews the estimated total direct costs on each
contract to determine if the estimated amounts are accurate, and estimates are adjusted as needed in the period identified. No
losses were recognized on contracts during the period ended December&nbsp;31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 5. &nbsp;&nbsp;&nbsp;SHARE-BASED COMPENSATION:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On April 20, 2015, our Board of Directors
and the holder of a majority of our outstanding shares of common stock approved the adoption of our 2015 Equity Incentive Award
Plan (the &quot;Plan&quot;) and a grant of discretionary authority to the executive officers to implement and administer the Plan.
The Plan allows for the issuance of up to 2,000,000 shares of our common stock for award grants (all of which can be incentive
stock options). The Plan provides equity-based compensation through the grant of cash-based awards, nonqualified stock options,
incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units
and other stock-based awards. We believe that an adequate reserve of shares available for issuance under the Plan is necessary
to enable us to attract, motivate and retain key employees and directors and to provide an additional incentive for such individuals
through stock ownership and other rights that promote and recognize the financial success and growth of our Company. During the
twelve months ended December 31, 2016, we granted 982,700 options to employees. As of December 31, 2016, aggregate grants under
the Plan total 1,563,569 shares of our common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 6. &nbsp;&nbsp;&nbsp;INCOME TAXES:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The provision for income taxes consists
of the following components for the years ended December&nbsp;31:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: justify">Current:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: justify">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Federal and state</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">(355,243</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">)</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">60,040</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify; padding-bottom: 1pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">96,357</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify; padding-bottom: 1pt">Total current provision</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(258,886</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">60,040</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: justify">Deferred:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Federal and state</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,488,960</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(979,006</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify; padding-bottom: 1pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Valuation allowance</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">790,506</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify; padding-bottom: 1pt">Total deferred benefit</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(3,488,960</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(188,500</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: justify; padding-bottom: 1pt">Total provision for income taxes</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(3,747,846</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(128,460</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company recorded a tax provision (benefit)
of $(3,747,846) and $(128,460) for the periods ended December&nbsp;31, 2016 and December&nbsp;31, 2015, respectively. The reported
tax provision (benefit) for the twelve-month periods ended December&nbsp;31, 2016 and December&nbsp;31, 2015 are based upon an
estimated annual effective tax rate of 34% for all such periods.&nbsp;The effective tax rates reflected our combined federal and
state income tax rates and the recognition of U.S. deferred tax liabilities for differences between the book and tax basis of goodwill.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We assess the&nbsp;reliability of our deferred
tax assets and assess the need for a valuation allowance on an ongoing basis. The periodic assessment of the net carrying value
of our deferred tax assets under the applicable accounting rules is highly judgmental. We are required to consider all available
positive and negative evidence in evaluating the likelihood that we will be able to realize the benefit of our deferred tax assets
in the future. Such evidence includes scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning
strategies and the results of recent operations. Since this evaluation requires consideration of events that may occur some years
into the future, there is significant judgment involved and our conclusion could be materially different should certain of our
expectations not transpire.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We have reviewed the tax positions taken,
or to be taken, in our tax returns for all tax years currently open to examination by a taxing authority. As of December&nbsp;31,
2016, the gross amount of unrecognized tax benefits exclusive of interest and penalties was zero. We have identified no other uncertain
tax positions for which it is reasonably possible that the total amount of unrecognized tax benefits will significantly increase
or decrease within the twelve months ending December&nbsp;31, 2017. We remain subject to examination until the statute of limitations
expires for each respective tax jurisdiction.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>NOTE 7. &nbsp;&nbsp;&nbsp;INTANGIBLE ASSETS:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We amortize our intangible assets that
have finite lives using either the straight-line method or based on estimated future cash flows to approximate the pattern in which
the economic benefit of the asset will be utilized. Amortization expense was $1,309,842 and $164,750 during the twelve-month periods
ended December&nbsp;31, 2016 and December 31, 2015 respectively. This amortization expense relates to customer lists, which expire
through 2020.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As of December 31, 2016, and December 31,
2015, the aggregate capitalized intangible assets of the Company were as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December
31,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2016</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December
31,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2015</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; text-align: justify">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: justify">Capitalized intangible assets</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">10,074,546</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">3,279,263</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify; padding-bottom: 1pt">Accumulated amortization</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,309,842</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">164,750</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: justify; padding-bottom: 2.5pt">Total intangible assets</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">8,764,704</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">3,114,513</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company&rsquo;s amortization schedule is as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: left"><U>Years ending December 31,</U></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Amount</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 80%; font-size: 10pt; text-align: left">2017</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 14%; font-size: 10pt; text-align: right">2,464,184</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">2018</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,115,592</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">2019</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,748,250</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">2020</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,621,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">2021</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">815,678</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left"><B>Total</B></TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">8,764,704</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has its own software products,
namely Simple APO, Langer Index and IBP. Total costs incurred for developing these products during the twelve months ended December
31, 2016 was $55,104 and have been capitalized and are being amortized over the useful life of the software products.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company's intangible assets consists
of the customer lists acquired from the Company's acquisition of WinHire Inc,&nbsp;Ameri Georgia, DCM, Virtuoso and Bigtech. The
products acquired from the acquisition of Linear Logics. Corp. and the amount spent on improving those products are also categorized
as intangible assets and are being amortized over the useful life of those products.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>NOTE 8. GOODWILL:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Goodwill represents the excess of the aggregate
purchase price over the fair value of the net assets acquired in businesses combinations. Goodwill was comprised of the following
amounts:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2016</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2015</B></P></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt">Virtuoso</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">939,881</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">DCM</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,416,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">Bigtech</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">314,555</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Ameri Consulting Service Pvt. Ltd.</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,948,118</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Ameri Georgia</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,470,522</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,470,522</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">Total</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">17,089,076</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">3,470,522</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt; text-align: right; font-size: 8pt"></P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 9. &nbsp;&nbsp;&nbsp;ACCRUED EXPENSES AND OTHER LIABILITIES:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Accrued expense and other liabilities as
of December 31, 2016 and December 31, 2015 consisted of the following:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2016</B>&nbsp;</P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2015</B></P></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">Legal fee payable</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">386,497</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">338,946</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Advances from customers</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">44,841</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Tax payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">388,044</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">320,247</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Audit fee payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">47,900</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">21,500</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Other liabilities</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">145,524</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">310,784</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Travelling &amp; conveyance payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">16,358</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,010</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Salaries &amp; wages payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,044</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Bonus payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">62,060</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Consultancy fee payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">25,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">50,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">401(k) payable</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,486</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">Total</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">1,079,427</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">1,093,814</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 10. FAIR VALUE MEASUREMENT:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We utilize the following valuation hierarchy
for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels
as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 8%; text-align: center"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="width: 92%; text-align: justify">Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="text-align: justify">Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument; and</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: center"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD>
    <TD STYLE="text-align: justify">Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value.</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">A financial asset or liability's classification
within the hierarchy is determined based upon the lowest level input that is significant to the fair value measurement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As of both December&nbsp;31, 2016 and December
31, 2015 we had no financial assets and liabilities required to be measured on a recurring basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">No financial instruments were transferred
into or out of Level 3 classification during the twelve-month period ended December&nbsp;31, 2016 and 2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt; text-align: right; font-size: 8pt"></P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 11. &nbsp;&nbsp;&nbsp;EARNINGS (LOSS) PER SHARE:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">A reconciliation of net income and weighted
average shares used in computing basic and diluted net income per share is as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; font-weight: bold; text-align: center">Twelve Months Ended</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">December 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: justify">Basic net income (loss) per share:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: justify">Net income (loss) applicable to common shares</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">(2,788,112</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">)</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">(814,075</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify">Weighted average common shares outstanding</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,068,597</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,101,198</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Basic net income (loss) per share of common stock</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.21</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.07</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: justify">Diluted net income (loss) per share:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Net income (loss) applicable to common shares</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(2,788,112</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(814,075</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify">Weighted average common shares outstanding</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,068,597</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,101,198</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Dilutive effects of convertible debt, stock options and warrants</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify">Weighted average common shares, assuming dilutive effect of stock options</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,068,597</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,101,198</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify">Diluted net income (loss) per share of common stock</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.21</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.07</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Share-based awards, inclusive of all grants
made under the Company's equity plans, for which either the stock option exercise price or the fair value of the restricted share
award exceeds the average market price over the period, have an anti-dilutive effect on earnings per share, and accordingly, are
excluded from the diluted computations for all periods presented.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">During the twelve months ended December
31, 2016, we granted our directors and employees options to purchase 782,700 shares of our common stock and restricted stock units
for 507,680 shares of our common stock. As of December 31, 2016, we had outstanding options to purchase 972,700 shares of the Company's
common stock and restricted stock units for 590,869 shares of the Company's common stock, resulting in share-based awards for a
total of 1,563,569 shares of our common stock outstanding under the Plan leaving 436,431 share-based units available under the
Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Due to the Company's net loss, potential
dilutive shares were not included in the calculation of diluted EPS on December 31, 2016, as it will have an antidilutive effect.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 12.&nbsp;&nbsp;&nbsp; EMPLOYEE BENEFIT PLAN:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has a 401(k)-tax deferred
savings plan (the &quot;401(k) Plan&quot;) that is available to all employees who satisfy certain minimum hour requirements each
year. The Company matches 100% of the first 3% of a participant's salary contributed under the 401(k) Plan and 50% on the next
2% of each participant's salary contributed under the 401(k).<BR></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 13. &nbsp;&nbsp;&nbsp;OPTIONS:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">As of December 31, 2016 and December&nbsp;31,
2015, the Company had issued and outstanding options to purchase 972,700 and 150,000 shares of our common stock, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On May 26, 2015, the Company issued an
option to purchase 100,000 shares of common stock to non-employee directors of the Company. Prior to this issuance, the Company
had not granted any option. This tranche of options vested on the anniversary of the grant date at an exercise price of $2.00 per
share and expires on May 26, 2021. This tranche of options was valued using the Black-Scholes pricing model. Significant assumptions
used in the valuation of this tranche of options include an expected term of 2.75 years, expected volatility of 50%, a date of
issue risk free interest rate of 1.53% and expected dividend yield of 0%. The aggregate value of these options on the grant date
was $36,304 and the option expense for December 31, 2016 and December 31, 2015 was determined to be $14,520 and $21,784, respectively.
As of December 31, 2016, no options had been exercised from this tranche of options.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On November 16, 2015, the Company issued
an option to purchase 50,000 shares of common stock to an employee of the Company. This tranche of options was to vest in equal
installments over three years at an exercise price of $4.01 per share and was to expire on November 16, 2021. This tranche of options
was valued using the Black-Scholes pricing model. Significant assumptions used in the valuation of this tranche of options include
an expected term of 3.25 years, expected volatility of 50%, a date of issue risk free interest rate of 1.66% and expected dividend
yield of 0%. The aggregate value of these options on the grant date was $73,265 and the option expense for December 31, 2016 and
December 31, 2015 was determined to be $7,123 and $929. As of December 31, 2016, these options had been cancelled.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On January 22, 2016, the Company issued
an option to purchase 5,000 shares of common stock to an employee of the Company. This tranche of options was to vest in equal
installments over three years at an exercise price of $6.02 per share and was to expire on January 22, 2021. This tranche of options
was valued using the Black-Scholes pricing model. Significant assumptions used in the valuation of this tranche of options include
an expected term of 3.25 years, expected volatility of 50%, a date of issue risk free interest rate of 1.49% and expected dividend
yield of 0%. The aggregate value of these options on the grant date was $10,944 and the option expense for December 31, 2016 and
2015 was determined to be $854 and $0, respectively. As of December 31, 2016, these options had been cancelled.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On January 28, 2016, the Company issued
an option to purchase 100,000 shares of common stock to an employee of the Company. This tranche of options was to vest in equal
installments over three years at an exercise price of $6.02 per share and was to expire on January 28, 2021. This tranche of options
was valued using the Black-Scholes pricing model. Significant assumptions used in the valuation of this tranche of options include
an expected term of 3.25 years, expected volatility of 50%, a date of issue risk free interest rate of 1.40% and expected dividend
yield of 0%. The aggregate value of these options on the grant date was $218,314 and the option expense for December 31, 2016 and
2015 was determined to be $61,776 and $0, respectively. As of December 31, 2016, these options had been cancelled.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On May 10, 2016, the Company issued an
option to purchase 500,000 shares of common stock to a non-employee director of the Company. This tranche of options was to vests
(a) as to 166,667 shares on May 10, 2017, (b) as to a further 166,667 shares on May 10, 2018, and (c) as to the remaining 166,666
shares on May 10, 2019, at an exercise price of $6.00 per share and expires on May 10, 2022. This tranche of options was valued
using the Black-Scholes pricing model. Significant assumptions used in the valuation of this tranche of options include an expected
term of three years, expected volatility of 50%, a date of issue risk free interest rate of 0.57% and expected dividend yield of
0%. The value on the grant date of these options was $1,737,445 and the option expense for December 31, 2016 and 2015 was determined
to be $370,496 and $0, respectively. As of December 31, 2016, no options had been exercised from this tranche of options.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On June 28, 2016, the Company issued an
option to purchase 25,000 shares of common stock to a non-employee director of the Company. This tranche of options vests on the
anniversary of the grant date at an exercise price of $6.51 and expires on June 28, 2022. This tranche of options was valued using
the Black-Scholes pricing model. Significant assumptions used in the valuation of this tranche of options include an expected term
of three years, expected volatility of 50%, a date of issue risk free interest rate of 0.57% and expected dividend yield of 0%.
The value on the grant date of these options was $55,251 and the option expense for December 31, 2016 and 2015 was determined to
be $9,359 and $0, respectively. As of December 31, 2016, no options had been exercised from this tranche of options.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On September 8, 2016, the Company issued
options to employees of the Company to purchase 215,200 shares of common stock. These option grants vest over four years at an
exercise price of $6.51 per share and expire on September 8, 2020. This tranche of options was valued using the Black-Scholes pricing
model. Significant assumptions used in the valuation of this tranche of options include an expected term of four years, expected
volatility of 50%, a date of issue risk free interest rate of 0.57% and expected dividend yield of 0%. The value on the grant date
of these options was $546,318 and the option expense for December 31, 2016 and 2015 was determined to be $49,239 and $0, respectively.
As of December 31, 2016, no options had been exercised from this tranche of options.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Number of Shares</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Weighted Avg. Exercise Price</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; font-weight: bold; padding-bottom: 1pt">Options outstanding at December&nbsp;31, 2015</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">150,000</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2.67</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Granted</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">982,700</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">6.79</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">Exercised</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Cancelled / Expired</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(160,000</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5.41</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">Outstanding at December 31, 2016</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">972,700</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">6.38</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">As of December 31, 2016 and December 31, 2015 the outstanding
options had a weighted average remaining term and intrinsic value of 4.33 and 0 years and $500,000 and $0, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Outstanding and Exercisable Options</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Average</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Exercise
Price</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Number
of</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Shares</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Remaining</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Average</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Contractual</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Life</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>(in
years)</B>&nbsp;</P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Exercise</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Price</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>times</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>number
of</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Shares</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Weighted</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Average</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Exercise</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Price</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Intrinsic</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Value</B></P></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2.00</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">100,000</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3.40</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">200,000</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2.00</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 13%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">451,000</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>NOTE 14. WARRANTS:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Below is a table summarizing the Company's
outstanding warrants for the year ended December 31, 2016:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="2" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Number of Shares</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Weighted Avg. Exercise Price</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Weighted Avg. Remaining Term</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Intrinsic Value</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 35%; font-size: 10pt; font-weight: bold; text-align: left"><B>Outstanding at December&nbsp;31, 2015</B></TD><TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; font-size: 10pt; font-weight: bold; text-align: right">2,777,777</TD><TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; font-size: 10pt; font-weight: bold; text-align: right">1.80</TD><TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 12%; font-size: 10pt; font-weight: bold; text-align: right">4.41</TD><TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="width: 12%; font-size: 10pt; font-weight: bold; text-align: right">13,333,330</TD><TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Granted</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,000,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">6.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Exercised</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,111,111</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1.80</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left"><B>Outstanding at December 31, 2016</B></TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">2,666,666</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">1.80</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">3.90</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">15,444,440</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">For the year ended December 31, 2016 and December&nbsp;31, 2015,
the Company incurred no warrants based expense.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>NOTE 15. &nbsp;&nbsp;&nbsp;RESTRICTED STOCK UNITS:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On August 4, 2015, the Company issued restricted
stock units for 83,189 shares of common stock to non-employee directors of the Company. Prior to this issuance there no restricted
stock unit grants had been made by the Company. This tranche of restricted stock units was valued at $3.51 per share, the market
value per share on the date of the grant, and vested on the anniversary of the grant date. The aggregate value of the restricted
stock units on the grant date was $291,994 and the restricted stock unit expense for December 31, 2016 and December 31, 2015 was
determined to be $172,797 and $119,197, respectively. As of December 31, 2016, 83,189 restricted stock units had vested.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On May 10, 2016, the Company issued restricted
stock units for 500,000 shares of common stock to a non-employee director. This tranche of restricted stock units was valued at
$7.00 per share, the market value per share on the date of the grant, and vests (a) as to 166,667 shares, on May 10, 2017, (b)
as to a further 166,667 shares, on May 10, 2018, and (c) as to the remaining 166,666 shares, on May 10, 2019, subject to the grantee
continuing to be a director of the Company through such date. The aggregate value of the restricted stock units on the grant date
of the restricted stock units was $3,500,000 and the restricted stock unit expense for December 31, 2016 was determined to be $746,348.
As of December 31, 2016, none of the foregoing restricted stock units had vested.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On June 28, 2016, the Company issued restricted
stock units for 7,680 shares of common stock to a non-employee director. This tranche of restricted stock units was valued at $6.51
per share, the market value per share on the date of the grant, and vests on the anniversary of the grant date. The aggregate value
of the restricted stock units on the grant date of the restricted stock units was $49,997 and the restricted stock unit expense
for December 31, 2016 was determined to be $25,135. As of December 31, 2016, none of the foregoing restricted stock units had vested.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>NOTE 16. &nbsp;&nbsp;&nbsp;DEBT:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On July 1, 2016, the Company entered into
that certain Loan and Security Agreement (the &quot;Loan Agreement&quot;), with its wholly-owned subsidiaries Ameri and Partners
Inc and Bellsoft, Inc., as borrowers (the &quot;Borrowers&quot;), the Company and its wholly-owned subsidiaries Linear Logics,
Corp. and WinHire Inc serving as guarantors, the Company's Chief Executive Officer, Giri Devanur, serving as a validity guarantor,
and Sterling National Bank, N.A. (as lender and as agent, &quot;Sterling&quot;). The Company joined DCM, Virtuoso and ATCG as borrowers
under the Loan Agreement following their respective acquisition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Under the Loan Agreement, the Borrowers
can borrow up to an aggregate of $10 million, which includes up to $8 million in principal for revolving loans (the &quot;Revolving
Loans&quot;) for general working capital purposes, up to $2 million in principal pursuant to a term loan (the &quot;Term Loan&quot;)
for the purpose of a permitted business acquisition and up to $200,000 for letters of credit. A portion of the proceeds of the
Loan Agreement were also used to repay the November 20, 2015 credit facility that was entered into between the Company, its wholly-owned
subsidiary Bellsoft, Inc. (Ameri Georgia) and&nbsp;Federal National Payables, Inc.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The maturity of the loans under the Loan
Agreement are as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 40pt">Revolving Loan Maturity
Date: July 1, 2019; provided, however, that the Revolving Loan Maturity Date will extend and renew automatically for successive
one-year terms on each anniversary of the initial Revolving Loan Maturity Date (each an &quot;Anniversary Date&quot;) thereafter,
unless not less than sixty (60) days prior to any such Anniversary Date, written notice of non-renewal is given by either party
to the other, in which case the Revolving Loan Maturity Date will be such next Anniversary Date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 40pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 40pt">Term Loan Maturity Date:
The earliest of (a) the date following acceleration of the Term Loan and/or the Revolving Loans; (b) the Revolving Loan Maturity
Date; or (c) July 1, 2019.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 40pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Interest under the Loan Agreement is payable
monthly in arrears and accrues as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 6%; text-align: justify">&nbsp;</TD>
    <TD STYLE="width: 8%; text-align: justify">(a)</TD>
    <TD STYLE="width: 86%; text-align: justify">in the case of Revolving Loans, a rate per annum equal to the sum of (i) the Wall Street Journal Prime Rate plus (ii) 2.00%;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;&nbsp;</TD>
    <TD STYLE="text-align: justify">(b)</TD>
    <TD STYLE="text-align: justify">in the case of the Term Loan, a rate per annum equal to the sum of (i) the Wall Street Journal Prime Rate plus (ii) 3.75%; and</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="text-align: justify">&nbsp;&nbsp;</TD>
    <TD STYLE="text-align: justify">(c)</TD>
    <TD STYLE="text-align: justify">in the case of other obligations of the Borrowers, a rate per annum equal to the sum of (i) the greater of (A) 3.25% or (B) Wall Street Journal Prime Rate plus (ii) 3.75%.</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">The Loan Agreement
also requires the payment of certain fees, including, but not limited to letter of credit fees and an unused Revolving Loans fee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">The Loan Agreement
contains financial and other covenant requirements, including, but not limited to, financial covenants that require the Borrowers
to not permit capital expenditures above $150,000 in any fiscal year, maintain a fixed charge coverage ratio of not less than 2.00
to 1.00 and maintain certain debt to EBITDA ratios. The Loan Agreement also requires the Company and Borrowers to obtain Sterling's
consent before making any permitted acquisitions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">The principal
amount of the Term Loan will be repaid as follows: (i) equal consecutive monthly installments in the amount of $33,333.33 each,
paid on the first day of each calendar month and (ii) one final payment of the entire remaining principal balance, together with
all accrued unpaid interest on the Term Loan maturity date. The Company's outstanding balance with Sterling National Bank for the
Term Loan and Revolving Loans was $1,923,466 and $2,743,177, respectively, as of December 31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">The Company did
not fulfill certain of the financial covenants contained in its Loan Agreement with Sterling National Bank as of December 31, 2016.
Sterling National Bank waived the Company&rsquo;s non-compliance with the Loan Agreement through December 31, 2016 without penalty
or the payment of any fee by the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">Bigtech, which
was acquired as of July 1, 2016, had a term loan of $18,101 and a line of credit for $345,713 as of December 31, 2016. The Bigtech
line of credit is with the Indian bank HDFC Bank Limited and was entered into on June 3, 2015 for Bigtech&rsquo;s working capital
requirements. The line of credit is for up to $416,667 with an interest rate of 11.85% per annum and maturity in June 2030. The
Bigtech term loan accrues interest at the rate of 10.30% per annum and matures in 2020. Both the term loan and the line of credit
were already in place when the Company acquired Bigtech.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Short-term Debt:</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The following summarizes our short-term debt balances as of
December 31:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">Notes outstanding under revolving credit facility</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">3,088,890</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,235,935</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Term loan - current maturities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">405,376</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font: 10pt Times New Roman, Times, Serif; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt">Total short-term debt</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">3,494,266</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">1,235,935</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>&nbsp;</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B><I>Long-term Debt:</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The following summarizes our long-term debt balances as of December
31:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">Term loan, due 2019</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,941,567</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Less:&nbsp;&nbsp;Current maturities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">405,376</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt">Long-term debt, net of current maturities</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">1,536,191</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The following represents the schedule of maturities of our long-term
debt:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="2" STYLE="font-size: 10pt; font-weight: bold; border-bottom: Black 1pt solid; text-align: left">Year</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Amounts</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="2" STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 80%; font-size: 10pt; text-align: left">2017</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 15%; font-size: 10pt; text-align: right">405,376</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">2018</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">405,376</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">2019</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,130,815</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left"><B>&nbsp;Total</B></TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">1,941,567</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B>NOTE 17. &nbsp;&nbsp;&nbsp;COMMITMENTS
AND CONTINGENCIES:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Operating
Leases</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">The Company's
principal facility is located in Princeton, New Jersey. The Company also leases office space in various locations with expiration
dates between 2016 and 2020. The lease agreements often include leasehold improvement incentives, escalating lease payments, renewal
provisions and other provisions which require the Company to pay taxes, insurance, maintenance costs, or defined rent increases.
All of the Company's leases are accounted for as operating leases. Rent expense is recorded over the lease terms on a straight-line
basis. Rent expense was $220,280 and $47,475 for the twelve months ended December 31, 2016 and December 31, 2015, respectively.
The increase during these periods is due to new office space that was leased by the Company in Princeton, New Jersey on July 1,
2015 and the addition of office space through the acquisition of DCM, Virtuoso and Bigtech.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">The Company has
entered into an operating lease for its primary office facility in Princeton, New Jersey, which expires in July 2017. The future
minimum rental payments under these lease agreements are as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="2" STYLE="font-size: 10pt; font-weight: bold; text-align: left">Year ending December 31,</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Amount</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 80%; font-size: 10pt; text-align: left">2017</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 15%; font-size: 10pt; text-align: right">251,512</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">2018</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">112,901</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">2019</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">79,478</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">2020</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">18,754</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left"><B>Total</B></TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">462,645</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 18. &nbsp;&nbsp;&nbsp;SUBSEQUENT EVENTS:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">On January 27,
2017, the Company issued 33,333 shares of its common stock its legal counsel, Olshan Frome Wolosky LLP (&quot;Olshan&quot;), in
exchange for the cancellation of a portion of accrued and unpaid legal fees owed by the Company to Olshan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">The Company partnered
with NEC Corporation of America (NEC), in February 2017, to offer SAP HANA Migration services. Through this partnership, the Company
will offer solutions to its clients aspiring to make the transition from SAP ECC (on-premise) applications to SAP HANA applications.
NEC is a leading technology integrator providing integrated communications, analytics, security, biometrics and technology solutions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">On March 7, 2017,
the Company completed the sale and issuance of 8% Convertible Unsecured Promissory Notes (the &quot;2017 Notes&quot;) for proceeds
to us of an aggregate of $1,250,000, to four accredited investors, including one of the Company's directors, Dhruwa N. Rai. The
2017 Notes were issued pursuant to Securities Purchase Agreements with each investor, pursuant to which each investor purchased
its 2017 Note from the Company. The 2017 Notes bear interest at 8% per annum until maturity in March 2020, with interest being
paid annually on the first, second and third anniversaries of the issuance of the 2017 Notes beginning in March 2018. From and
after an event of default and for so long as the event of default is continuing, the 2017 Notes will bear default interest at the
rate of 10% per annum. The 2017 Notes can be prepaid by the Company at any time without penalty.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">The 2017 Notes
are convertible into shares of Ameri common stock at a conversion price of (i) in the event that any registration statement for
the public offering of common stock filed by the Company with the SEC in connection with an uplisting to a national stock exchange
is declared effective by the SEC on or prior to December 31, 2017, such price per share that is equal to 68% of the price per share
of common stock offered and sold pursuant to such registration statement, or (ii) if no such registration statement is declared
effective by December 31, 2017, such price per share that is equal to the weighted average closing price per share of the Company's
common stock for the 20 trading days immediately preceding December 31, 2017, subject to adjustment under certain circumstances.
The 2017 Notes rank junior to the Company's secured credit facility with Sterling National Bank. The 2017 Notes also include certain
negative covenants including, without the investors' approval, restrictions on dividends and other restricted payments and reclassification
of its stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">On March 10, 2017,
the Company acquired 100% of the shares of ATCG Technology Solutions, Inc. (&ldquo;ATCG&rdquo;), a Delaware corporation, pursuant
to the terms of a Share Purchase Agreement among the Company, ATCG, all of the stockholders of ATCG (the &ldquo;Stockholders&rdquo;)
and the Stockholders&rsquo; representative.&nbsp; ATCG provides U.S. domestic, offshore and onsite SAP consulting services and
has its main office in Folsom, California. The aggregate purchase price for the acquisition of ATCG consisted of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font-size: 10pt">
<TR>
    <TD STYLE="width: 7%">&nbsp;</TD>
    <TD STYLE="vertical-align: top; width: 7%">(a)</TD>
    <TD STYLE="vertical-align: top; width: 86%; text-align: justify">576,923 shares of our common stock, valued at approximately $3.8 million based on the closing price of our common stock on the closing date of the acquisition;</TD></TR>
<TR>
    <TD>&nbsp;</TD>
    <TD STYLE="vertical-align: top">(b)</TD>
    <TD STYLE="vertical-align: top; text-align: justify">Unsecured promissory notes issued to certain of ATCG&rsquo;s selling Stockholders for the aggregate amount of $3,750,000 (which notes bear interest at a rate of 6% per annum and mature on June 30, 2018); </TD></TR>
<TR>
    <TD>&nbsp;</TD>
    <TD STYLE="vertical-align: top">(c)</TD>
    <TD STYLE="vertical-align: top; text-align: justify">Earn-out payments in shares of Ameri common stock (up to an aggregate value of $1,200,000 worth of shares) to be paid, if earned, in each of 2018 and 2019 based on certain revenue and EBITDA targets as specified in the purchase agreement. The Company estimates those targets will be fully achieved; and</TD></TR>
<TR>
    <TD STYLE="text-align: justify">&nbsp;</TD>
    <TD STYLE="vertical-align: top">(d)</TD>
    <TD STYLE="vertical-align: top; text-align: justify">An additional cash payment of $55,687 for cash that was left in ATCG at closing.</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><FONT STYLE="background-color: white">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><FONT STYLE="background-color: white">The
total purchase price of&nbsp;$8,784,533&nbsp;was allocated to intangibles of $3.75 million, taking into consideration projected
revenue from the acquired list of ATCG customers over a period of three years, and goodwill. The excess of total purchase price
over the intangibles allocation has been allocated to goodwill.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">On March 13, 2017,
the Company announced a merger proposal for Ciber, Inc. (&quot;Ciber&quot;). The proposal was rejected by Ciber and the Company
did not further pursue a transaction with Ciber.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>AMERI HOLDINGS,
INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEETS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2017</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2016</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="5" STYLE="font-size: 10pt; font-weight: bold">Assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Current assets:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">Cash and cash equivalents</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,041,133</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,379,887</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Accounts receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,720,203</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,059,910</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Investments</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">82,908</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">82,908</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Other current assets</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">907,501</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">542,237</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Total current assets</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">10,751,745</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">10,064,942</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Other assets:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Property and equipment, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">107,533</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">100,241</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Intangible assets, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,058,035</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,764,704</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Acquired goodwill</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">21,886,567</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">17,089,076</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Deferred income tax assets, net</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,488,960</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,488,960</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Total other assets</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">36,541,095</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">29,442,981</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Total assets</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">47,292,840</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">39,507,923</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Current liabilities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Line of credit</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,105,454</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,088,890</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Accounts payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,945,303</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,130,817</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Other accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,813,292</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,165,088</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Bank term loan</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">406,031</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">405,376</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Consideration payable &ndash; cash</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,626,738</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,854,397</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Consideration payable &ndash; equity</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">196,251</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">64,384</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Dividend payable</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">499,965</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Total current liabilities</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">15,593,034</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">12,708,952</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Long- term liabilities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Convertible notes</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,250,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Bank term loan</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,333,718</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,536,191</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Consideration payable &ndash; cash</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,502,500</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,711,717</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Consideration payable &ndash; equity</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">11,993,722</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">10,887,360</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Total long-term liabilities</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">18,079,940</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">15,135,268</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Total liabilities</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">33,672,974</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">27,844,220</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Stockholders&rsquo; equity:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">Preferred stock, $0.01 par value; 1,000,000 authorized, 373,708 issued and outstanding as of June 30, 2017 and 363,611 as of December 31, 2016</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,737</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,636</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Common stock, $0.01 par value; 100,000,000 shares authorized, 14,650,412 and 13,885,972 issued and outstanding as of June 30, 2017 and December 31, 2016 respectively.</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">146,503</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">138,860</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Additional paid-in capital</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">22,289,906</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">15,358,839</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Accumulated deficit</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(8,827,876</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,833,588</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Accumulated other comprehensive income (loss)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(4,276</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(7,426</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Non-controlling interest</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(11,872</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,382</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Total stockholders&rsquo; equity</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">13,619,866</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">11,663,703</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Total liabilities and stockholders&rsquo; equity</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">47,292,840</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">39,507,923</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See accompanying notes to the unaudited
condensed consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>AMERI HOLDINGS,
INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Three Months</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ended</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30, 2017</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Three Months</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ended</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30, 2016</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Six Months</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ended</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30, 2017</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Six Months</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;Ended</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30, 2016</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 40%; font-size: 10pt">Revenue</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">12,268,259</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">6,686,938</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">24,609,186</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">13,699,902</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">Cost of revenue</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">9,935,468</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,169,538</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">18,975,045</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">10,926,845</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Gross profit</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">2,332,791</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">1,517,400</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">5,634,141</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">2,773,057</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Operating expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Selling and marketing</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">434,895</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">135,329</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">767,205</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">166,679</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">General and administration</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,405,377</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,977,510</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">7,106,522</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,696,100</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Acquisition related expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">175,136</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">239,815</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">384,480</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">615,220</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Depreciation and amortization</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">825,657</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">101,385</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,514,757</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">213,013</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Operating expenses</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">5,841,065</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">2,454,039</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">9,772,964</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">4,691,012</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Operating income (loss)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,508,274</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(936,639</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(4,138,823</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,917,955</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Interest expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(164,343</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(270,514</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(255,149</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(384,260</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Changes in estimates</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">400,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">400,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Other expense &ndash; net</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8,624</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1,862</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,475</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,161</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Income (loss) before income taxes</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,263,993</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,209,015</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,989,497</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,304,376</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Tax benefit / (provision)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Income after income taxes</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,263,993</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,209,015</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,989,497</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,304,376</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Net income attributable to non-controlling interest</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(15,388</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(11,872</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net income (loss) attributable to the Company</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,279,381</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,209,015</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(4,001,369</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,304,376</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Dividend on preferred stock</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(504,826</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,004,791</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net loss attributable to common stock holders</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,784,207</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,209,015</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(5,006,160</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,304,376</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Other comprehensive income (loss), net of tax</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Foreign exchange translation</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,185</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,808</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,150</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(65,698</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Comprehensive income/(loss)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,786,392</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,211,823</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(5,003,010</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,370,074</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Comprehensive income/(loss) attributable to the Company</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(3,771,004</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,211,823</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(4,991,138</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(2,370,074</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt">Comprehensive income/(loss) attributable to the non-controlling interest</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">(15,388</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">(11,872</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">(3,786,392</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">(1,211,823</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">(5,003,010</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">(2,370,074</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">Basic income (loss) per share</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.26</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.09</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.35</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.19</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Diluted income (loss) per share</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.26</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.09</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.35</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.19</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Basic weighted average number of common shares outstanding</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14,610,609</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">12,845,057</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14,352,573</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">12,359,709</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">Diluted weighted average number of common shares outstanding</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14,610,609</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">12,845,057</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14,352,573</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">12,359,709</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See accompanying notes to the unaudited
condensed consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>AMERI HOLDINGS,
INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF&nbsp;CASH FLOWS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Six Months</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ended</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30,</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Cash flow from operating activities</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">Comprehensive income/(loss)</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">(5,003,010</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">)</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">(2,370,074</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Adjustment to reconcile comprehensive income/(loss) to net cash used in operating activities</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Depreciation and amortization</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,514,757</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">213,013</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Provision for Preference dividend</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,004,791</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Changes in estimate of contingent consideration</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(400,000</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Stock, option, restricted stock unit and warrant expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,470,980</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">443,705</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Foreign exchange translation adjustment</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,150</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Changes in assets and liabilities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Increase (decrease) in:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Accounts receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(660,293</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">738,512</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Other current assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(365,264</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(137,412</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Increase (decrease) in:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Accounts payable and accrued expenses</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(266,100</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">946,105</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Net cash provided by (used in) operating activities</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(1,700,989</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(166,151</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Cash flow from investing activities</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Purchase of fixed assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(7,800</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(130,394</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Acquisition consideration</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(694,711</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,232,168</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">Investments</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">82,908</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Net cash used in investing activities</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(702,511</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(3,279,654</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Cash flow from financing activities</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Proceeds from bank loan and convertible notes</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,064,746</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">171,434</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Additional stock issued</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,000,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Non-controlling interest</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Net cash provided by financing activities</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">2,064,746</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">5,171,434</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net increase (decrease) in cash and cash equivalents</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(338,754</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">1,725,629</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Cash and cash equivalents as at beginning of the period</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">1,379,887</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">1,878,034</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Cash at the end of the period</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">1,041,133</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">3,603,663</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See accompanying notes to the unaudited
condensed consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>AMERI HOLDINGS,
INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>NOTES TO UNAUDITED
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white"><B>JUNE 30, 2017</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 1.&#9;&nbsp;&nbsp;&nbsp;ORGANIZATION:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">AMERI
Holdings, Inc. is a fast-growing technology services company which provides SAP cloud, digital and enterprise services to clients
worldwide. Headquartered in Princeton, New Jersey Ameri100 has offices in the U.S. and Canada.&nbsp; The Company additionally has
global delivery centers in India. With its bespoke engagement model, Ameri100 delivers transformational value to its clients across
industry verticals.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 2.&#9;&nbsp;&nbsp;&nbsp;BASIS OF PRESENTATION:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
accompanying unaudited condensed consolidated financial statements have been prepared by the Company in accordance with generally
accepted accounting principles in the United States of America, or U.S. GAAP, and Article 10 of Regulation S-X under the Securities
Exchange Act of 1934, as amended. Certain information and disclosure notes normally included in annual financial statements prepared
in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to those
rules and regulations, although we believe that the disclosures made are adequate to ensure the information presented is not misleading.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
accompanying unaudited condensed consolidated financial statements reflect all adjustments (which were of a normal, recurring nature)
that, in the opinion of management, are necessary to present fairly our financial position, results of operations and cash flows
as of and for the interim periods presented. All intercompany transactions have been eliminated in the accompanying unaudited condensed
consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">Our
comprehensive income (loss) consists of net income (loss) plus or minus any periodic currency translation adjustments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
Company&rsquo;s year-end is December 31. Ameri and Partners Inc, the Company&rsquo;s wholly-owned operating subsidiary that was
the accounting acquirer in connection with the Company&rsquo;s May 2015 reverse merger, changed its fiscal year end from March
31 to December 31 pursuant to the merger, so that all of the Company&rsquo;s subsidiaries&rsquo; year-ends are consistent with
the year-end of the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">During
the first quarter of 2016, the Company erroneously classified approximately $1.9 million of expenses as general and administrative
expenses which should have been classified as cost of revenue. The Company has corrected this error in its Quarterly Report on
Form 10-Q for the quarter ended March 31, 2017. The reclassification did not change the Company&rsquo;s net income or loss for
the period reported.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
results for the interim periods presented are not necessarily indicative of the results expected for any future period. The following
information should be read in conjunction with the audited financial statements and notes thereto included in our Annual Report
on Form 10-K for the fiscal year ended December 31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B>Recent Accounting
Pronouncements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>New Standards to Be Implemented</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">In
May 2014, the Financial Accounting Standards Board (the &ldquo;FASB&rdquo;) issued Accounting Standards Update (&ldquo;ASU&rdquo;)
2014-09, &ldquo;Revenue from Contracts with Customers (Topic 606),&rdquo; which supersedes the revenue recognition requirements
in &ldquo;Revenue Recognition (Topic 605).&rdquo; This ASU requires an entity to recognize revenue when goods are transferred or
services are provided to customers in an amount that reflects the consideration to which the entity expects to be entitled to in
exchange for those goods or services. This ASU also requires disclosures enabling users of financial statements to understand the
nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In August 2015, the FASB
issued ASU 2015-14, &ldquo;Revenue from Contracts with Customers (Topic 606), deferral of the Effective Date.&rdquo; With the issuance
of ASU 2015-14, the new revenue guidance ASU 2014-09 will be effective for annual periods, and interim periods within those annual
periods, beginning after December 15, 2018, using one of two prescribed retrospective methods. In April 2016, the FASB issued ASU
2016-10, &ldquo;Revenue from Contracts with Customer (Topic 606), Identifying Performance Obligations and Licensing.&rdquo; The
guidance is applicable from the date of applicability of ASU 2014-09. This ASU finalizes the amendments to the guidance on the
new revenue standard on the identification of performance obligations and accounting for licenses of intellectual property. In
December 2016, the FASB issued ASU 2016-20, &ldquo;Technical Corrections and Improvements (Topic 606)&rdquo; which is applicable
from the date of applicability of ASU 2014-09. This guidance provides optional exemptions from the disclosure requirement for remaining
performance obligations for specific situations in which an entity need not estimate variable consideration to recognize revenue.
In May 2016, FASB issued ASU No. 2016-12, &ldquo;Narrow-Scope Improvements and Practical Expedients&rdquo;. This amendment clarified
certain aspects of Topic 606 and will be applicable from the date of applicability of ASU 2014-09. The Company is in process of
evaluating the impact of the foregoing updates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">In
February 2016, the FASB issued ASU No. 2016-02, &ldquo;Leases (Topic 842)&rdquo;. This new standard replaces the existing guidance
on leases and requires the lessee to recognize a right-of-use asset and a lease liability for all leases with lease terms equal
to or greater than twelve months. For finance leases, the lessee would recognize interest expense and amortization of the right-of-use
asset, and for operating leases, the lessee would recognize total lease expense on a straight-line basis. This standard is effective
for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2018. Upon adoption, entities
will be required to use a modified retrospective transition which provides for certain practical expedients. Entities are required
to apply the new standard at the beginning of the earliest comparative period presented. Early adoption of this new standard is
permitted. The Company is currently evaluating the effect this new standard will have on its consolidated financial statements
and related disclosures. The Company does not expect the requirement to recognize a right-of-use asset and a lease liability for
operating leases to have a material impact on the presentation of its consolidated statements of financial position.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">In
August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash
Payments (ASU 2016-15), which clarifies how companies present and classify certain cash receipts and cash payments in the statement
of cash flows. The guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal
years. Based on its current assessment, the Company does not expect the adoption of this update to have a material impact on its
consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">On
November 17, 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which is intended to reduce
diversity in the presentation of restricted cash and restricted cash equivalents in the statement of cash flows. This new standard
requires that restricted cash and restricted cash equivalents be included as components of total cash and cash equivalents as presented
on the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted
cash and restricted cash equivalents in the statement of cash flows. ASU 2016-18 is effective for annual periods beginning after
December 15, 2017 including interim periods within those fiscal years, but earlier adoption is permitted.&nbsp; The Company does
not believe the adoption of this new standard will have a material impact on its consolidated financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">In
January 2017, the FASB issued ASU No. 2017-04, simplifying the Test for Goodwill Impairment. Under this new standard, goodwill
impairment would be measured as the amount by which a reporting unit&rsquo;s carrying value exceeds its fair value, not to exceed
the carrying value of goodwill. This ASU eliminates existing guidance that requires an entity to determine goodwill impairment
by calculating the implied fair value of goodwill by hypothetically assigning the fair value of a reporting unit to all of its
assets and liabilities as if that reporting unit had been acquired in a business combination. This update is effective for annual
periods beginning after December 15, 2019, and interim periods within those periods. Early adoption is permitted for interim or
annual goodwill impairment test performed on testing dates after January 1, 2017. The Company is in process of evaluating the impact
of these updates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">In
January 2017, the FASB issued ASU No. 2017-01, clarifying the Definition of a Business, which clarifies and provides a more robust
framework to use in determining when a set of assets and activities is a business. The amendments in this update should be applied
prospectively on or after the effective date. This update is effective for annual periods beginning after December 15, 2017 and
interim periods within those periods. Early adoption is permitted for acquisition or deconsolidation transactions occurring before
the issuance date or effective date and only when the transactions have not been reported in issued or made available for issuance
financial statements. The Company does not believe the adoption of this new standard will have a material impact on its consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B>Standards Implemented</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">In
September 2015, the FASB issued ASU No. 2015-16, &ldquo;Simplifying the Accounting for Measurement-Period Adjustments&rdquo;. The
guidance eliminates the requirement that an acquirer in a business combination account for a measurement period adjustment retrospectively.
Instead, an acquirer will recognize a measurement period adjustment during the period in which the amount of the adjustment is
determined. In addition, the portion of the amount recorded in current period earnings by line item that would have been recorded
in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date should
be presented separately on the face of the income statement or disclosed in the notes. This guidance was effective for fiscal years
beginning after December 15, 2015, including interim periods within those fiscal years. This guidance did not have a material impact
on the Company&rsquo;s consolidated financial results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">In
March 2016, the FASB issued ASU No. 2016-09, &ldquo;Compensation &ndash; Stock Compensation&rdquo;. The new guidance changes the
accounting for share based payment transactions, including the income tax consequences, classification of awards as either equity
or liabilities and classification in the Consolidated Statement of Cash Flows. The guidance is effective for annual periods beginning
after December 15, 2016, and interim periods within those annual periods. This guidance did not have a material impact on the Company&rsquo;s
consolidated financial results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 3.&#9;&nbsp;&nbsp;&nbsp;BUSINESS COMBINATIONS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Acquisition
of Ameri Georgia</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">On
November 20, 2015, we completed the acquisition of Bellsoft, Inc., a consulting company based in Lawrenceville, Georgia with over
175 consultants specialized in the areas of SAP software, business intelligence, data warehousing and other enterprise resource
planning services. Following the acquisition, the name of Bellsoft, Inc. was changed to Ameri100 Georgia Inc. (&ldquo;Ameri Georgia&rdquo;).
Ameri Georgia has operations in the United States, Canada and India. For financial accounting purposes, we recognized September
1, 2015 as the effective date of the acquisition. The total consideration for the acquisition of Ameri Georgia was $9,910,817,
consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.5in">(a)</TD><TD STYLE="text-align: justify">A cash payment in the amount of $3,000,000, which was paid at closing;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.5in">(b)</TD><TD STYLE="text-align: justify">235,295 shares of our common stock issued at closing;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.5in">(c)</TD><TD STYLE="text-align: justify">$250,000 quarterly cash payments paid on the last day of each calendar quarter of 2016;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.5in">(d)</TD><TD STYLE="text-align: justify">A $1,000,000 cash reimbursement paid 5 days following closing to compensate Ameri Georgia for a
portion of its approximate cash balance as of September 1, 2015;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.5in">(e)</TD><TD STYLE="text-align: justify">Approximately $2,910,817 paid within 30 days of closing in connection with the excess of Ameri
Georgia&rsquo;s accounts receivable over its accounts payable as of September 1, 2015; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.5in">(f)</TD><TD STYLE="text-align: justify">Earn-out payments of approximately $500,000 a year for 2016 and 2017, if earned through the achievement
of annual revenue and earnings before interest, taxes depreciation and amortization (&ldquo;EBITDA&rdquo;) targets specified in
the purchase agreement, subject to downward or upward adjustment depending on actual results.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
earn-out for 2016 was 30% higher than the previously agreed targets, resulting in a higher than anticipated earn-out payment, and
the excess of the 2016 earn-out payment over what was planned was made as an adjustment to our income statement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
valuation of Ameri Georgia was made on the basis of its projected revenues. The accounting acquisition date for Ameri Georgia was
determined on the basis of the date when the Company acquired control of Ameri Georgia, in accordance with FASB codification ASU
805-10-25-6 for business combinations. That ASU provides that the date on which the acquirer obtains control of the acquiree generally
is the date on which the acquirer legally transfers the consideration, acquires the assets, and assumes the liabilities of the
acquiree&mdash;the closing date. However, the acquirer might obtain control on a date that is either earlier or later than the
closing date. For example, the acquisition date precedes the closing date if a written agreement provides that the acquirer obtains
control of the acquiree on a date before the closing date. An acquirer shall consider all pertinent facts and circumstances in
identifying the acquisition date.&nbsp; The term sheet and the Share Purchase Agreement that were entered into by the Company and
Ameri Georgia contained agreements by the parties that the Company acquired control of Ameri Georgia&rsquo;s accounts payable,
accounts receivable and business decisions as of September 1, 2015. In addition, on that date, the Company became responsible for
performance of Ameri Georgia&rsquo;s existing contracts. Accordingly, the Company has recognized September 1, 2015 as the accounting
acquisition date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
total purchase price of $9,910,817 was allocated to net working capital of $4.6 million, intangibles of $1.8 million, taking into
consideration projected revenue from the acquired list of Ameri Georgia customers over a period of three years, and goodwill. The
excess of total purchase price over the net working capital and intangibles allocations has been allocated to goodwill.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
Company paid $261,876 in cash to the former shareholders of Ameri Georgia as earn-out payments during the six months ended June
30, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Acquisition
of Bigtech Software Private Limited</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">On
June 23, 2016, we entered into a definitive agreement to acquire Bigtech Software Private Limited (&ldquo;Bigtech&rdquo;), a pure-play
SAP services company providing a wide range of SAP services including turnkey implementations, application management, training
and basis ABAP support. Based in Bangalore, India, Bigtech offers SAP services to improve business operations at companies of all
sizes and verticals. The acquisition of Bigtech was effective as of July 1, 2016, and the total consideration for the acquisition
of Bigtech was $850,000, consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">(a)</TD><TD>A cash payment in the amount of $340,000, which was due within 90 days of closing and was paid on September 22, 2016;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">(b)</TD><TD>Warrants for the purchase of 51,000 shares of our common stock (valued at approximately $250,000 based on the $6.51 closing
price of our common stock on the closing date of the acquisition), with such warrants exercisable for two years; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">(c)</TD><TD>$255,000, which may become payable in cash earn-outs to the sellers of Bigtech, if Bigtech achieves certain pre-determined
revenue and EBITDA targets in 2017 and 2018. We estimate the earn-out payments to be earned at 100% of the targets set forth in
the purchase agreement.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.25in; background-color: white">Bigtech&rsquo;s
financial results are included in our condensed consolidated financial results starting July 1, 2016.&nbsp; The Bigtech acquisition
did not constitute a significant acquisition for the Company.&nbsp;The valuation of Bigtech was made on the basis of its projected
revenues.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
total purchase price of $850,000 was allocated to intangibles of $595,000, taking into consideration projected revenue from the
acquired list of Bigtech customers over a period of three years, and goodwill. The excess of total purchase price over the intangibles
allocation has been allocated to goodwill.&nbsp; The Bigtech acquisition did not constitute a significant acquisition for the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Acquisition
of Virtuoso</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">On
July 22, 2016, we, through wholly-owned acquisition subsidiaries, acquired all of the outstanding membership interests of Virtuoso,
L.L.C. (&ldquo;Virtuoso&rdquo;), a Kansas limited liability company, pursuant to the terms of an Agreement of Merger and Plan of
Reorganization, by and among us, Virtuoso Acquisition Inc., Ameri100 Virtuoso Inc., Virtuoso and the sole member of Virtuoso (the
&ldquo;Sole Member&rdquo;). Virtuoso is a SAP consulting firm specialized in providing services on SAP S/4 HANA finance, enterprise
mobility and cloud migration and is based in Leawood, Kansas. In connection with the merger, Virtuoso&rsquo;s name was changed
to Ameri100 Virtuoso Inc. The Virtuoso acquisition did not constitute a significant acquisition for the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
total purchase price paid to the Sole Member for the acquisition of Virtuoso was $1,831,881 consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">(a)</TD><TD>A cash payment in the amount of $675,000, which was due within 90 days of closing and was paid on October 21, 2016;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">(b)</TD><TD>101,250 shares of our common stock at closing, valued at approximately $700,000 based on the $6.51 closing price of our common
stock on the closing date of the acquisition; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in">(c)</TD><TD>Earn-out payments in cash and stock of $450,000 and approximately $560,807, respectively, to be paid, if earned, through the
achievement of annual revenue and gross margin targets in 2017, 2018 and 2019. Out of the total contingent consideration of approximately
$1,000,000, we only considered 50% of the earn-out in the purchase price, mainly due to the reorganization of Virtuoso.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
total purchase price of $1,831,881 was allocated to intangibles of $0.9 million, taking into consideration projected revenue from
the acquired list of Virtuoso customers over a period of three years, and the balance was allocated to goodwill.&nbsp;&nbsp;The
Virtuoso earn-out payments for 2016 amounted to $64,736 in cash and 12,408 shares of common stock, which were delivered to the
Sole Member during the quarter ended June 30, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Acquisition
of Ameri Arizona</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">On
July 29, 2016, we acquired 100% of the membership interests of DC&amp;M Partners, L.L.C. (&ldquo;Ameri Arizona&rdquo;), an Arizona
limited liability company, pursuant to the terms of a Membership Interest Purchase Agreement by and among us, Ameri Arizona, all
of the members of Ameri Arizona, Giri Devanur and Srinidhi &ldquo;Dev&rdquo; Devanur, our President and Chief Executive Officer
and Executive Vice Chairman, respectively. In July 2017, the name of DC&amp;M Partners, L.L.C. was changed to Ameri100 Arizona
LLC. Ameri Arizona is a SAP consulting company headquartered in Chandler, Arizona. Ameri Arizona provides its clients with a wide
range of information technology development, consultancy and management services with an emphasis on the design, build and rollout
of SAP implementations and related products. Ameri Arizona is also a SAP-certified software partner, having launched its SAP reporting,
extraction and distribution tool called &ldquo;IRIS&rdquo;. Ameri Arizona services clients in diverse industries, including retail,
apparel/footwear, third-party logistics providers, chemicals, consumer goods, energy, high-tech electronics, media/entertainment
and aerospace.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
aggregate purchase price for the acquisition of Ameri Arizona was $15,816,000 consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(a)</TD><TD STYLE="text-align: justify">A cash payment in the amount of $3,000,000 at closing;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(b)</TD><TD STYLE="text-align: justify">1,600,000 shares of our common stock (valued at approximately $10.4 million based on the $6.51
closing price of our common stock on the closing date of the acquisition), which are to be issued on July 29, 2018 or upon a change
of control of our company (whichever occurs earlier); and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(c)</TD><TD STYLE="text-align: justify">Earn-out payments of $1,500,000 payable in cash each year to be paid, if earned, through the achievement
of annual revenue and gross margin in 2017 and 2018.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 22.5pt; background-color: white">The
total purchase price of $15,816,000 was allocated to intangibles of $5.4 million, taking into consideration projected revenue from
the acquired list of Ameri Arizona customers over a period of three years, and the balance was allocated to goodwill.&nbsp; Based
on the Company&rsquo;s current estimates of the consideration payable under the purchase agreement, the Company does not believe
the&nbsp;Ameri Arizona&nbsp;will achieve its earn-out for 2017 and has reduced the consideration payable estimates by $400,000
in its income statement for the quarter ended June 30, 2017. The Company is also currently negotiating with the former members
of&nbsp;Ameri Arizona&nbsp;regarding the Company&rsquo;s earn-out payment obligations.&nbsp; The Company paid $300,000 in earn-out
payments during the quarter ended June 30, 2017 for earn-out amounts earned prior to such date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 22.5pt; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Acquisition
of Ameri California</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">On
March 10, 2017, we acquired 100% of the shares of&nbsp;ATCG Technology Solutions, Inc.&nbsp;(&ldquo;Ameri California&rdquo;), a
Delaware corporation, pursuant to the terms of a Share Purchase Agreement among the Company, ATCG, all of the stockholders of Ameri
California (the &ldquo;Stockholders&rdquo;), and the Stockholders&rsquo; representative. In July 2017, the name of ATCG Technology
Solutions, Inc. was changed to Ameri100 California Inc.&nbsp; Ameri California provides U.S. domestic, offshore and onsite SAP
consulting services and has its main office in Folsom, California. Ameri California specializes in providing SAP Hybris, SAP Success
Factors and business intelligence services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
aggregate purchase price for the acquisition of Ameri California was $8,784,533, consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(a)</TD><TD STYLE="text-align: justify">576,923 shares of our common stock, valued at approximately $3.8 million based on the closing price
of our Common Stock on the closing date of the acquisition;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(b)</TD><TD STYLE="text-align: justify">Unsecured promissory notes issued to certain of&nbsp;Ameri California&rsquo;s&nbsp;selling Stockholders
for the aggregate amount of $3,750,000 (which notes bear interest at a rate of 6% per annum and mature on June 30, 2018);</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(c)</TD><TD STYLE="text-align: justify">Earn-out payments in shares of our common stock (up to an aggregate value of $1,200,000 worth of
shares) to be paid, if earned, in each of 2018 and 2019 based on certain revenue and EBITDA targets as specified in the purchase
agreement. We estimate those targets will be fully achieved; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(d)</TD><TD STYLE="text-align: justify">An additional cash payment of $55,687 for cash that was left in&nbsp;Ameri California&nbsp;at closing.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
total purchase price of $8,784,533 was allocated to intangibles of $3.75 million, taking into consideration projected revenue from
the acquired list of&nbsp;Ameri California&nbsp;customers over a period of three years, and goodwill. The excess of total purchase
price over the intangibles allocation has been allocated to goodwill.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">For
this acquisition, the net cash outflow in 2017 was $ 55,687.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">Presented
below is the summary of the foregoing acquisitions:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; background-color: white; font-size: 10pt">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP STYLE="width: 100%; border-bottom: black 1.5pt solid; text-align: center"><B>Allocation of purchase price in millions of U.S. dollars&nbsp;</B></TD></TR>
</TABLE>
<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; background-color: white; font-size: 10pt">
<TR>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid; text-align: center"><B>Asset Component</B></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD NOWRAP COLSPAN="2" STYLE="border-bottom: black 1.5pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ameri</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Georgia</B></P></TD>
    <TD NOWRAP STYLE="vertical-align: bottom; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD NOWRAP COLSPAN="2" STYLE="border-bottom: black 1.5pt solid; text-align: center"><B>Bigtech</B></TD>
    <TD NOWRAP STYLE="vertical-align: bottom; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD NOWRAP COLSPAN="2" STYLE="border-bottom: black 1.5pt solid; text-align: center"><B>Virtuoso</B></TD>
    <TD NOWRAP STYLE="vertical-align: bottom; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1.5pt solid; border-left: black 1.5pt solid"></TD>
    <TD NOWRAP COLSPAN="2" STYLE="border-bottom: black 1.5pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ameri</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Arizona</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P></TD>
    <TD NOWRAP STYLE="vertical-align: bottom; border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD NOWRAP COLSPAN="2" STYLE="vertical-align: top; border-bottom: black 1.5pt solid">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ameri</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>California</B></P></TD>
    <TD NOWRAP STYLE="vertical-align: bottom; border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 35%; border-left: black 1.5pt solid">Intangible Assets</TD>
    <TD STYLE="width: 1%; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right">1.8</TD>
    <TD NOWRAP STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right">0.6</TD>
    <TD NOWRAP STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right">0.9</TD>
    <TD NOWRAP STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right">5.4</TD>
    <TD NOWRAP STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 1%; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="width: 1%">&nbsp;</TD>
    <TD STYLE="width: 10%; text-align: right">3.8</TD>
    <TD NOWRAP STYLE="width: 1%; border-right: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-left: black 1.5pt solid">Goodwill</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">3.5</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">0.3</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">0.9</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">10.4</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">5.0</TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="border-left: black 1.5pt solid"><FONT STYLE="background-color: #CCEEFF"><B><U>Working Capital</U></B></FONT></TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-left: black 1.5pt solid"><B>Current Assets</B></TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="border-left: black 1.5pt solid">Cash</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">1.4</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-left: black 1.5pt solid">Accounts Receivable</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">5.6</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="border-left: black 1.5pt solid">Other Assets</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">0.2</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">-</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">-</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">-</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">-</TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">7.3</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="border-left: black 1.5pt solid"><B>Current Liabilities</B></TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-left: black 1.5pt solid">Accounts Payable</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">1.3</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="border-left: black 1.5pt solid">Accrued Expenses &amp; Other Current Liabilities</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">1.3</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">-</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">-</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">-</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">-</TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">2.7</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">-</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">-</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">-</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">-</TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="border-left: black 1.5pt solid"><B>Net Working Capital Acquired</B></TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">4.6</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP>&nbsp;</TD>
    <TD STYLE="border-left: black 1.5pt solid">&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD STYLE="text-align: right">-</TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid"><B>Total Purchase Price</B></TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right"><B>9.9</B></TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right"><B>0.9</B></TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right"><B>1.8</B></TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right"><B>15.8</B></TD>
    <TD NOWRAP STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; border-left: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid">&nbsp;</TD>
    <TD STYLE="border-bottom: black 1.5pt solid; text-align: right"><B>8.8</B></TD>
    <TD NOWRAP STYLE="border-right: black 1.5pt solid; border-bottom: black 1.5pt solid">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
Company has $19,319,211, in total towards consideration payable including contingent consideration payable for its acquisitions,
consisting of $7,129,238 in cash obligations and $12,189,973 worth of common stock to be issued (assuming a per share price of
$6.51). Out of $19,319,211, $5,346,688 is towards contingent consideration payable on earn-outs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 4.&#9;&nbsp;&nbsp;&nbsp;REVENUE RECOGNITION:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
Company recognizes revenue primarily through the provision of consulting services. We generate revenue by providing consulting
services under written service contracts with our customers. The service contracts we enter generally fall into two categories:
(1) time-and-materials contracts and (2) fixed-price contracts.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">We
consider amounts to be earned once evidence of an arrangement has been obtained, services are delivered, fees are fixed or determinable
and collectability is reasonably assured. We establish billing terms at the time at which the project deliverables and milestones
are agreed. Our standard payment terms are 60 days from invoice date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">When
a customer enters into a time-and-materials or fixed-price (or a periodic retainer-based) contract, the Company recognizes revenue
in accordance with its evaluation of the deliverables in each contract. If the deliverables represent separate units of accounting,
the Company then measures and allocates the consideration from the arrangement to the separate units, based on vendor specific
objective evidence of the value for each deliverable.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
revenue under time and materials contracts is recognized as services are rendered and performed at contractually agreed upon rates.
Revenue pursuant to fixed-price contracts is recognized under the proportional performance method of accounting. We routinely evaluate
whether revenue and profitability should be recognized in the current period. We estimate the proportional performance on our fixed-price
contracts on a monthly basis utilizing hours incurred to date as a percentage of total estimated hours to complete the project.
This method is used because reasonably dependable estimates of costs and revenue earned can be made, based on historical experience
and milestones identified in any particular contract. If we do not have a sufficient basis to measure progress toward completion,
revenue is recognized upon completion of performance, subject to any warranty provisions or other project management assessments
as to the status of work performed.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">Estimates
of total project costs are continuously monitored during the term of an engagement. There are situations where the number of hours
to complete projects may exceed our original estimate, as a result of an increase in project scope, unforeseen events that arise,
or the inability of the client or the delivery team to fulfill their responsibilities. Accordingly, recorded revenues and costs
are subject to revision throughout the life of a project based on current information and historical trends. Such revisions may
result in increases or decreases to revenue and income and are reflected in the consolidated financial statements in the periods
in which they are first identified.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">If
our initial estimates of the resources required or the scope of work to be performed on a contract are inaccurate, or we do not
manage the project properly within the planned time period, a provision for estimated losses on incomplete projects may be made.
Any known or probable losses on projects are charged to operations in the period in which such losses are determined. A formal
project review process takes place quarterly, although projects are continuously evaluated throughout the period. Management reviews
the estimated total direct costs on each contract to determine if the estimated amounts are accurate, and estimates are adjusted
as needed in the period identified. No losses were recognized on contracts during the period ended June 30, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 5.&#9;&nbsp;&nbsp;&nbsp;SHARE-BASED COMPENSATION:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">On
April 20, 2015, our Board of Directors and the holder of a majority of our outstanding shares of common stock approved the adoption
of our 2015 Equity Incentive Award Plan (the &ldquo;Plan&rdquo;). The Plan allows for the issuance of up to 2,000,000 shares of
our common stock for award grants. The Plan provides equity-based compensation through the grant of cash-based awards, nonqualified
stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares,
performance units and other stock-based awards. We believe that an adequate reserve of shares available for issuance under the
Plan is necessary to enable us to attract, motivate and retain key employees and directors and to provide an additional incentive
for such individuals through stock ownership and other rights that promote and recognize the financial success and growth of our
Company. We granted options to purchase 185,000 shares of our common stock and 98,669 restricted stock units pursuant to the Plan
during the six months ended June 30, 2017. Share based compensation expense for the period ended June 30, 2017 was $2,353,982.
During the current quarter 174,680 restricted stock units were cancelled and an accelerated cost of $792,764 due to such cancellation
has been accounted for as stock based compensation expense.&nbsp; As of June 30, 2017, out of the 2,000,000 shares available under
the Plan, aggregate grants of 1,690,358 shares of our common stock had been granted as options and restricted stock units.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 6. &#9;INTANGIBLE ASSETS:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">We
amortize our intangible assets that have finite lives using the straight-line method. Amortization expense was $1,459,592 during
the six months ended June 30, 2017. This amortization expense relates to customer lists and products capitalized on our balance
sheet, which expire through 2020.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">As
of June 30, 2017, and December 31, 2016, capitalized intangible assets were as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2017</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2016</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">Capitalized intangible assets</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">12,517,627</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">10,074,546</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Accumulated amortization</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,459,592</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,309,842</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Total intangible assets</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">11,058,035</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">8,764,704</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.25in; background-color: white">Our amortization
schedule is as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="2" STYLE="font-size: 10pt; font-weight: bold; text-align: left"><U>Years ending December 31,</U></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Amount</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 82%; font-size: 10pt; text-align: left">2017</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 13%; font-size: 10pt; text-align: right">1,470,513</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">2018</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,955,873</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">2019</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,727,968</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">2020</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,652,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">2021</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,251,681</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left"><B>Total</B></TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">11,058,035</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
Company&rsquo;s intangible assets consist of the customer lists acquired from the Company&rsquo;s acquisition of WinHire Inc, Ameri
Georgia, Ameri Arizona, Virtuoso, Bigtech and Ameri California. The products acquired from the acquisition of Linear Logics. Corp.
and the amount spent on improving those products are also categorized as intangible assets and are being amortized over the useful
life of those products.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 7.&#9;&nbsp;&nbsp;&nbsp;GOODWILL:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">Goodwill
represents the excess of the aggregate purchase price over the fair value of the net assets acquired in business combinations.&nbsp;
Goodwill was comprised of the following amounts:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2017</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2016</B></P></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt">Virtuoso</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">939,881</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">939,881</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Ameri Arizona</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,416,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,416,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">Bigtech</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">299,803</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">314,555</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Ameri Consulting Service Pvt. Ltd.</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,948,118</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,948,118</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Ameri Georgia</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,470,522</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,470,522</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Ameri California</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,812,243</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">Total</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">21,886,567</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">17,089,076</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">As
per Company policy, goodwill impairment tests will be conducted on an annual basis and any impairment will be reflected in the
Company&rsquo;s statements of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 8.&#9;&nbsp;&nbsp;&nbsp;EARNINGS (LOSS) PER SHARE:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">A
reconciliation of net income and weighted average shares used in computing basic and diluted net income per share is as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2017</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">Net income (loss) attributable to common stock holders</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">(5,006,160</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">)</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">(2,304,376</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Weighted average common shares outstanding</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14,352,573</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">12,359,709</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Basic net income (loss) per share of common stock</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.35</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.19</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Diluted net income (loss) per share of common stock</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.35</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">(0.19</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">Share
based awards, inclusive of all grants made under the Plan, for which either the stock option exercise price or the fair value of
the restricted share award exceeds the average market price over the period, have an anti- dilutive effect on earnings per share,
and accordingly, are excluded from the diluted computations for all periods presented.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 9. &nbsp;&nbsp;&#9;OTHER ITEMS:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
Company paid an in-kind dividend on its Series A Preferred Stock for the quarter ended March 31, 2017 by issuing 10,097 shares
of Series A Preferred Stock to the sole holder of the Company&rsquo;s Series A Preferred Stock. The Company has yet to make the
dividend payment on its Series A Preferred Stock which was payable on June 30, 2017.&nbsp; The Company will pay the sole holder
of the Series A Preferred Stock the accrued dividend in-kind pursuant to the terms of the Certificate of Designation contemporaneously
with the filing of the Quarterly Report of Form 10-Q for the quarter ended June 30, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 10.&nbsp;&nbsp; BANK DEBT:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">On
July 1, 2016, the Company entered into a Loan and Security Agreement (the &ldquo;Loan Agreement&rdquo;), with its wholly-owned
subsidiaries Ameri and Partners Inc and Ameri Georgia, as borrowers (the &ldquo;Borrowers&rdquo;), the Company and its wholly-owned
subsidiaries Linear Logics, Corp. and WinHire Inc serving as guarantors, the Company&rsquo;s Chief Executive Officer, Giri Devanur,
serving as a validity guarantor, and Sterling National Bank, N.A. (as lender and as agent, &ldquo;Sterling&rdquo;). The Company
joined Ameri Arizona, Virtuoso and Ameri California as borrowers under the Loan Agreement following their respective acquisition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">Under
the Loan Agreement, the Borrowers can borrow up to an aggregate of $10 million, which includes up to $8 million in principal for
revolving loans (the &ldquo;Revolving Loans&rdquo;) for general working capital purposes, up to $2 million in principal pursuant
to a term loan (the &ldquo;Term Loan&rdquo;) for the purpose of a permitted business acquisition and up to $200,000 for letters
of credit. A portion of the proceeds of the Loan Agreement were also used to repay the November 20, 2015 credit facility that was
entered into between the Company, its wholly-owned subsidiary Ameri Georgia and Federal National Payables, Inc.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
maturity of the loans under the Loan Agreement are as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">Revolving
Loan Maturity Date: July 1, 2019; provided, however, that the Revolving Loan Maturity Date will extend and renew automatically
for successive one-year terms on each anniversary of the initial Revolving Loan Maturity Date (each an &ldquo;Anniversary Date&rdquo;)
thereafter, unless not less than sixty (60) days prior to any such Anniversary Date, written notice of non-renewal is given by
either party to the other, in which case the Revolving Loan Maturity Date will be such next Anniversary Date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">Term
Loan Maturity Date: The earliest of (a) the date following acceleration of the Term Loan and/or the Revolving Loans; (b) the Revolving
Loan Maturity Date; or (c) July 1, 2019.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">Interest
under the Loan Agreement is payable monthly in arrears and accrues as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(a)</TD><TD STYLE="text-align: justify">in the case of Revolving Loans, a rate per annum equal to the sum of (i) the Wall Street Journal
Prime Rate plus (ii) 2.00%;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(b)</TD><TD STYLE="text-align: justify">in the case of the Term Loan, a rate per annum equal to the sum of (i) the Wall Street Journal
Prime Rate plus (ii) 3.75%; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.25in">(c)</TD><TD STYLE="text-align: justify">in the case of other obligations of the Borrowers, a rate per annum equal to the sum of (i) the
greater of (A) 3.25% or (B) Wall Street Journal Prime Rate plus (ii) 3.75%.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
Loan Agreement also requires the payment of certain fees, including, but not limited to letter of credit fees and an unused Revolving
Loans fee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
Loan Agreement contains financial and other covenant requirements, including, but not limited to, financial covenants that require
the Borrowers to not permit capital expenditures above $150,000 in any fiscal year, maintain a fixed charge coverage ratio of not
less than 2.00 to 1.00 and maintain certain debt to EBITDA ratios. The Loan Agreement also requires the Company and Borrowers to
obtain Sterling&rsquo;s consent before making any permitted acquisitions.&nbsp; The amounts borrowed by the Borrowers under the
Loan Agreement are guaranteed by the guarantors, and the Loan Agreement is secured by substantially all of the Borrowers&rsquo;
assets.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
principal amount of the Term Loan will be repaid as follows: (i) equal consecutive monthly installments in the amount of $33,333.33
each, paid on the first day of each calendar month and (ii) one final payment of the entire remaining principal balance, together
with all accrued unpaid interest on the Term Loan maturity date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
Company has not been in conformance with the financial covenants contained in its Loan Agreement with Sterling National Bank.&nbsp;
The Company received a waiver from Sterling National Bank for its non-compliance with the Loan Agreement for the quarter ended
March 31, 2017 and June 30, 2017 in exchange for the payment of a fee of $5,000 for each quarterly waiver. The Company does not
expect to be in compliance with the terms of the Loan Agreement following the conclusion of the terms of the waivers granted by
Sterling National Bank. The Company is continuing to work with Sterling National Bank to address its non-compliance.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">If
we are unable to obtain future waivers from Sterling National Bank, the bank could declare our loans with it to be in default and
elect to claim all amounts outstanding to be immediately due and payable and terminate all commitments to extend further credit.
If we are unable to repay the outstanding amounts, Sterling National Bank could proceed against the collateral granted to it to
secure our indebtedness to it. We pledged substantially all of our assets as collateral under the Loan Agreement.&nbsp; The Loan
Agreement is also supported by a limited guaranty from Giri Devanur, our President and Chief Executive Officer. If Sterling National
Bank accelerates the repayment of our loans, there is no assurance that we will have sufficient assets to repay the loans. A default
under the Loan Agreement may also result in an event of default under the Company&rsquo;s outstanding convertible notes.&nbsp;
We are currently looking for additional sources of financing, however there is no guarantee that we will have additional financing
available to us.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">Interest
paid on the Term Loan during the period ended June 30, 2017 amounted to $69,625. Principal repaid on the Term Loan during the period
ended June 30, 2017 was $200,000. The short term and long-term outstanding balances on the Term Loan as of June 30, 2017 was $399,996
and $1,323,470, respectively. The outstanding balance of the Revolving Loans as of June 30, 2017 was $3,794,042.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">Bigtech,
which was acquired as of July 1, 2016, had a term loan of $16,283 and a line of credit for $311,412 as of June 30, 2017. The Bigtech
line of credit is with an Indian bank, HDFC Bank Limited, and was entered into on June 3, 2015 for Bigtech&rsquo;s working capital
requirements. The line of credit is for up to $416,667 with an interest rate of 11.85% per annum and maturity in June 2020. The
Bigtech term loan accrues interest at the rate of 10.30% per annum and matures in 2020. Both the term loan and the line of credit
were already in place when the Company acquired Bigtech. Interest paid during the period ended June 30, 2017 amounted to $20,543
for the term loan and line of credit held by Bigtech.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 11.&#9;&nbsp;&nbsp;CONVERTIBLE NOTES:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">On
March 7, 2017, we completed the sale and issuance of 8% Convertible Unsecured Promissory Notes (the &ldquo;2017 Notes&rdquo;) for
aggregate proceeds to us of $1,250,000 from four accredited investors, including one of the Company&rsquo;s directors, Dhruwa N.
Rai. The 2017 Notes were issued pursuant to Securities Purchase Agreements between the Company and each investor. The 2017 Notes
bear interest at 8% per annum until maturity in March 2020, with interest being paid annually on the first, second and third anniversaries
of the issuance of the 2017 Notes beginning in March 2018. From and after an event of default and for so long as the event of default
is continuing, the 2017 Notes will bear default interest at the rate of 10% per annum. The 2017 Notes can be prepaid by us at any
time without penalty.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
2017 Notes are convertible into shares of our common stock at a conversion price of (i) in the event that any registration statement
for the public offering of common stock filed by the Company with the Securities and Exchange Commission (the &ldquo;SEC&rdquo;)
in connection with an uplisting to a national stock exchange is declared effective by the SEC on or prior to December 31, 2017,
such price per share that is equal to 68% of the price per share of common stock offered and sold pursuant to such registration
statement, or (ii) if no such registration statement is declared effective by December 31, 2017, such price per share that is
equal to the weighted average closing price per share of the Company&rsquo;s common stock for the 20 trading days immediately
preceding December 31, 2017, subject to adjustment under certain circumstances. The 2017 Notes rank junior to our secured credit
facility with Sterling National Bank. The 2017 Notes also include certain negative covenants including, without the investors&rsquo;
approval, restrictions on dividends and other restricted payments and reclassification of its stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 12. &#9;&nbsp;COMMITMENTS AND CONTINGENCIES:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B><I>Operating
Leases</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
Company&rsquo;s principal facility is located in Princeton, New Jersey. The Company also leases office space in various locations
with expiration dates between 2016 and 2020. The lease agreements often include leasehold improvement incentives, escalating lease
payments, renewal provisions and other provisions which require the Company to pay taxes, insurance, maintenance costs, or defined
rent increases. All of the Company&rsquo;s leases are accounted for as operating leases. Rent expense is recorded over the lease
terms on a straight-line basis. Rent expense was $&nbsp;151,797and $57,434 for the six months ended June 30, 2017 and 2016, respectively.
The increase during the comparative periods is due to the addition of office space through the acquisition of Ameri Arizona, Virtuoso,
Bigtech and Ameri California.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
Company has entered into an operating lease for its primary office facility in Princeton, New Jersey, which expires in July 2019.
The future minimum rental payments under these lease agreements are as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="2" STYLE="font-size: 10pt; font-weight: bold; border-bottom: Black 1pt solid; text-align: left">Year ending December 31,</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Amount</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 80%; font-size: 10pt; font-weight: bold; text-align: left">2017</TD><TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 15%; font-size: 10pt; text-align: right">124,334</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">2018</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">140,828</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">2019</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">103,283</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">2020</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">70,333</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">2021</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,371</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left"><B>Total</B></TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">446,149</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 13. &#9;FAIR VALUE MEASUREMENT:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.25in; background-color: white">The group&rsquo;s
financial instruments consist primarily of cash and cash equivalent, accounts receivable, accounts payable, contingent consideration
liability and accrued liabilities. The carrying amounts of accounts receivable, accounts payable, cash and cash equivalents and
accrued liabilities are considered to be the same as their fair value, due to their short-term nature.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">Fair
value is defined as the exchange price that would be received for an asset or an exit price paid to transfer a liability in the
principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement
date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable
inputs. The current accounting guidance for fair value measurements defines a three-level valuation hierarchy for disclosures as
follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs
that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the
full term of the financial instrument; and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.25in"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify">Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets and
liabilities at fair value.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">A
financial asset or liability&rsquo;s classification within the hierarchy is determined based upon the lowest level input that is
significant to the fair value measurement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt; text-align: right; font-size: 8pt"></P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
following table sets forth the financial assets, measured at fair value, by level within the fair value hierarchy as of June 30,
2017 and December 31, 2016:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2017</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;December 31,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2016</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; font-weight: bold">Level 3</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt">Contingent consideration</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">5,346,688</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">5,266,488</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
following table presents the change in level 3 instruments:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Three Months</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Ended June 30,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>2017</B></P></TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Six Months Ended</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>June 30, 2017</B></P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; font-weight: bold; text-align: left">Opening balance</TD><TD STYLE="width: 2%; font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font-size: 10pt; font-weight: bold; text-align: right">6,192,200</TD><TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font-size: 10pt; font-weight: bold; text-align: right">5,266,488</TD><TD STYLE="width: 1%; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Additions during the period</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1,200,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">Paid/settlements</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(445,512</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(719,800</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Total gains recognized in Statement of Operations</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(400,000</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(400,000</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Closing balance</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">5,346,688</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">5,346,688</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">Contingent
consideration pertaining to the acquisitions referred to in note 3 above as of June 30, 2017 has been classified under level 3
as the fair valuation of such contingent consideration has been done using one or more of the significant inputs which are not
based on observable market data.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
fair value of the contingent consideration was estimated using a discounted cash flow technique with significant inputs that are
not observable in the market. The significant inputs not supported by market activity&nbsp;included our probability assessments
of expected future cash flows related to the acquisitions during the earn-out period, appropriately discounted considering the
uncertainties associated with the obligation, and calculated in accordance with the respective terms of the share purchase agreements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
amount of total gains/(losses) included in our Statement of Operations and Comprehensive Income/(Loss) is attributable to change
in fair value of contingent consideration arising from the acquisition of Ameri Arizona were $(400,000) and $0 for the quarter
ended June 30, 2017 and the year ended December 31, 2016, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>NOTE 14.&#9;&nbsp;&nbsp;NON-CONTROLLING INTEREST:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
subsidiaries of the Company are all direct or indirect wholly-owned subsidiaries, except for Bellsoft India Solutions Private Limited
(&ldquo;Bellsoft India&rdquo;) and Ameritas Technologies India Private Limited, of which the Company held 72% and 76% of the equity
of each company, respectively, through March 31, 2017.&nbsp; On March 31, 2017, Ameri Georgia (parent of Bellsoft India) acquired
the remaining 28% of the equity of Bellsoft India held by minority shareholders for approximately $8,200. At the time of the acquisition,
the Company reversed the amount payable to non-controlling interest of $3,383 and the same amount was recorded as additional paid-in-capital.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">The
Company attributes relevant gains and losses to such non-controlling interests for every financial year. During the three months
ended June 30, 2017, 2016, and the six months ended June 30, 2017, 2016 the profit attributable to the holders of non-controlling
interests amounted to $15,388 and $0 and $11,872 and $0, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B>NOTE 15.&#9;&nbsp;&nbsp;SUBSEQUENT
EVENTS:</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">During
the third quarter of 2017, the Company began to streamline its operations following the acquisitions of Ameri Arizona and Ameri
California. This streamlining is expected to impact about 20 employees and will result in a restructuring charge of approximately
$80,000 in the quarter ending September 30, 2017. The Company anticipates that streamlining of its operations will result in&nbsp;annual
savings of approximately $1.5 million, inclusive of payroll, benefits, office consolidations and other ancillary employee related
costs.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.25in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">CERTIFIED PUBLIC ACCOUNTANTS</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Board of Directors and Stockholders<BR>
Bellsoft, Inc.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have audited the
accompanying consolidated balance sheets of Bellsoft, Inc. (the &ldquo;Company&rdquo;) as of December 31, 2014 and 2013 and the
related consolidated statements of operations, stockholders&rsquo; equity and cash flows for the years then ended. These consolidated
financial statements are the responsibility of the Company&rsquo;s management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We conducted our audits
in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the consolidated 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 controls over financial
reporting. Our audit 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&rsquo;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 audits provide a reasonable basis for our opinion.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In our opinion, the
consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company
as of December 31, 2014 and 2013 and the results of its operations and its cash flows for the years then ended, in conformity with
accounting principles generally accepted in the United States of America.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">/s/ Ram Associates<BR>
Ram Associates<BR>
Hamilton, NJ January 21, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">3240 EAST STATE STREET, HAMILTON, NJ 08619
(609) 631-9552/631-9553+ FAX (888) 319-8898<BR>
PKRAM@RAMASSOCIATES.US</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">BELLSOFT, INC. AND SUBSIDIARIES<BR>
Consolidated Balance Sheets</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">December 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2013</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center">ASSETS</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">CURRENT ASSETS</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt">Cash</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,209,793</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">2,309,919</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Accounts receivable, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,232,603</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,873,991</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Employee advances</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">7,114</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,500</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Prepaid expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,604</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">59,697</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Other receivable</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">38,025</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">TOTAL CURRENT ASSETS</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,492,139</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,249,107</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">PROPERTY AND EQUIPMENT, NET</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">111,856</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">98,050</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">OTHER ASSETS</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Security deposits</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">85,916</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">88,296</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Note receivable from shareholder</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">220,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Other assets</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,076</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,824</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">TOTAL OTHER ASSETS</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">92,992</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">314,120</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt">TOTAL ASSETS</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">5,696,987</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">5,661,277</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center">LIABILITIES AND SHAREHOLDERS&rsquo; EQUITY</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">CURRENT LIABILITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Accounts payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1,150,862</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">731,825</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,477,099</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,127,963</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Customer advances</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">89,770</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">211,969</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">Line of credit</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">500,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,750,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Income tax payable</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">21,143</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">29,953</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">TOTAL CURRENT LIABILITIES</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,238,874</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,851,710</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">SHAREHOLDERS&rsquo; EQUITY</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Common stock, no par, authorized 10,000 shares,</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">issued and outstanding 750 shares</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">102,875</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">102,875</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Retained earnings</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,396,321</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,694,266</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Accumulated other comprehensive loss</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(127,865</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(68,904</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Non-controlling interest</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">86,782</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">81,330</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">TOTAL SHAREHOLDERS&rsquo; EQUITY</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,458,113</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,809,567</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt">TOTAL LIABILITIES AND SHAREHOLDERS&rsquo; EQUITY</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">5,696,987</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">5,661,277</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">- See accompanying notes to consolidated
financial statements -</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">BELLSOFT, INC. AND SUBSIDIARIES&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Statements of Income
and Comprehensive Income</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Years Ended December 31</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2014</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2013</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; font-weight: bold">REVENUES</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">21,338,280</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">20,813,072</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">OPERATING EXPENSES</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">20,415,251</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">19,837,896</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Income from operations</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">923,029</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">975,176</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">OTHER INCOME (EXPENSES)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Interest income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,434</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,901</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Loss on disposal of assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,202</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Interest expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(28,578</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(26,970</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Unrealized gain on foreign currency</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">22,140</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,956</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">TOTAL OTHER EXPENSE</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(5,206</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(17,113</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Income before income tax expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">917,823</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">958,063</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Income tax expense</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">17,192</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">53,126</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">900,631</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">904,937</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Net income/(loss), non-controlling interest</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,452</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">20,338</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net income, controlling interest</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">895,179</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">884,599</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Other comprehensive income (loss):</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Foreign currency translation adjustment</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(58,961</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(3,683</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Comprehensive income</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">836,218</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">880,916</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">- See accompanying notes to consolidated
financial statements -</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">BELLSOFT, INC. AND SUBSIDIARIES</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Statements of Changes in<BR>
Shareholders&rsquo; Equity</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Years Ended December 31, 2014 and 2013</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">Accumulated</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">Other</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">Total</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">Common</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">Non-Controlling</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">Comprehensive</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">Retained</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">Shareholders&rsquo;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Stock</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Interest</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Loss</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Earnings</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Equity</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 25%; font-size: 10pt; font-weight: bold">Balance at December 31, 2012</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">102,875</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">60,992</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">(65,211</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">)</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">3,020,097</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">3,188,743</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Net income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">20,338</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">884,599</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">904,937</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Shareholders&rsquo; distributions</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(2,210,430</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(2,210,430</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Foreign currency translation adjustment</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,683</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,683</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold">Balance at December 31, 2013</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">102,875</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">81,330</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(68,904</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,694,266</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,809,567</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Net income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,452</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">895,179</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">900,631</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Shareholders&rsquo; distributions</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(193,124</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(193,124</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Foreign currency translation adjustment</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(58,961</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(58,961</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">Balance at December 31, 2014</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">102,875</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">86,782</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(127,865</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,396,321</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,458,113</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">- See accompanying
notes to consolidated financial statements -</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">BELLSOFT, INC. AND SUBSIDIARIES</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Consolidated Statements of Cash Flows<BR>
Years Ended December 31,</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2014</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2013</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CASH FLOWS FROM OPERATING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">Net income</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">900,631</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">904,937</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Adjustments to reconcile net income to net cash provided by operating activities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">Depreciation</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">24,040</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">47,320</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Translation adjustment</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(58,961</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,564</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Changes in assets and liabilities: Accounts receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,358,612</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">190,598</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Employee advances</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,614</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">44,500</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Prepaid expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">55,093</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(30,596</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Other receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(38,025</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Security deposits</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,380</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">10,061</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Other assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,252</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(5,824</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Accounts payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">419,037</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(715,765</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">349,136</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(147,232</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Customer advances</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(122,199</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">206,487</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Income tax payable</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(8,810</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(11,559</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Net cash provided by operating activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">160,844</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">495,491</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CASH FLOWS FROM INVESTING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Capital expenditures</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(37,846</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(9,577</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">(Increase)/decrease in note receivable from shareholder</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">220,000</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(50,000</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Net cash provided by/(used in) investing activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">182,154</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(59,577</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CASH FLOWS FROM FINANCING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Increase/(decrease) in line of credit</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,250,000</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,750,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Shareholders&rsquo; distributions</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(193,124</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,210,430</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Net cash used in financing activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1,443,124</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(460,430</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net decrease in cash and cash equivalents</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,100,126</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(24,516</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Cash at beginning of year</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,309,919</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,334,435</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Cash at end of year</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,209,793</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,309,919</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Supplemental disclosure:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Cash paid for interest</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">28,578</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">26,970</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Cash paid for foreign income taxes</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">59,864</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">82,374</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">- See accompanying notes to consolidated
financial statements -</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">BELLSOFT, INC. AND SUBSIDIARIES<BR>
Notes to Consolidated Financial Statements<BR>
December 31, 2014 and 2013</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 1 - NATURE OF OPERATIONS</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Bellsoft, Inc. (&ldquo;Bellsoft&rdquo;),
was incorporated in the State of Georgia on March 19, 1996. The Company provides implementation and custom development services
for Enterprise Resource Planning (ERP) software.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On February 7, 2005,
Bellsoft acquired 72% ownership interest in Bellsoft India Solutions Private (Pvt) Limited (Ltd), a company incorporated under
the laws of India (&ldquo;Bellsoft India&rdquo;). The primary purpose of Bellsoft India is to provide back office and marketing
functions to Bellsoft, Inc. Bellsoft India&rsquo;s fiscal year ends on March 31st. For consolidation purposes Bellsoft India prepares
statements for the reporting period, which corresponds with the fiscal year of the parent.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On August 31, 2011,
Bellsoft formed BSI Global IT Solutions, Inc. (Bellsoft Canada), a company incorporated under the laws of Canada. The primary purpose
of Bellsoft Canada is to provide implementation and custom development services for ERP software for clients in Canada. Bellsoft
owns 100% of Bellsoft Canada.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Bellsoft India and
Bellsoft Canada are collectively referred to as the Subsidiaries. Bellsoft, Inc. and the Subsidiaries are collectively referred
to as the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">BASIS OF CONSOLIDATION</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The consolidated financial
statements include the accounts of the Subsidiaries. All material intercompany transactions and balances have been eliminated in
consolidation.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">BASIS OF PRESENTATION</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has adopted
the Financial Accounting Standards Board (&ldquo;FASB&rdquo;) Codification (&ldquo;Codification&rdquo; or &ldquo;ASC&rdquo;). The
Codification is the single official source of authoritative accounting principles generally accepted in the United States of America
(&ldquo;U.S. GAAP&rdquo;) recognized by the FASB to be applied by nongovernmental entities. All of the Codification&rsquo;s content
carries the same level of authority.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">FOREIGN OPERATIONS AND FOREIGN CURRENCY</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Subsidiaries&rsquo;
foreign operations are subject to risks inherent in operating under different legal systems and various political and economic
environments. Among the risks are changes in existing tax laws, possible limitations on foreign investment and income repatriation,
government price or foreign exchange controls, and restrictions on currency exchange. Net assets of foreign operations were approximately
19% and 12% of the Company&rsquo;s total net assets at December 31, 2014 and 2013, respectively. Cash held in foreign based bank
accounts totaled approximately $290,000 and $268,000 at December 31, 2014 and 2013.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Subsidiaries transact
business in their local currencies. The financial statements reflect the translation of the functional currency statements to U.S.
Dollars. Financial statements use end-of-period exchange rates for assets and liabilities, weighted average exchange rates for
revenues and expenses, and historical rates for equity. The resulting foreign currency translation adjustment is recorded in accumulated
other comprehensive income (loss) as a component of equity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31, 2014 and 2013</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">USE OF ESTIMATES</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The preparation of
consolidated financial statements in conformity with U.S. GAAP 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. Actual results could differ from those
estimates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">REVENUE RECOGNITION</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company recognizes
revenue in accordance with FASB ASC 985-605-25-79. Revenue is derived from time and expense contracts and is recognized as the
services are performed. Revenue received as reimbursements of billable expenses is reported on a gross basis within revenue and
the related expenses are recorded in operating expenses. Unbilled revenue is comprised of revenue recognized in relation to efforts
incurred on time and expense contracts not billed at a period end where services are performed in accordance with agreed terms.
Customer advances represent payments received in advance of an engagement and are deferred until the service is performed.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">CASH AND CASH EQUIVALENTS</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company considers
all highly liquid investments with an original maturity of three months or less to be cash equivalents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">ACCOUNTS RECEIVABLE</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company routinely
assesses the financial strength of its customers and debtors and believes that its accounts receivable credit risk exposure is
limited. Accounts receivable are carried at the original invoice amount less an estimate made for doubtful receivables based on
a review of all outstanding amounts on a monthly basis. An allowance is provided for known and anticipated credit losses, as determined
by management in the course of regularly evaluating individual customer receivables. This evaluation takes into consideration a
customer&rsquo;s financial condition and credit history, as well as current economic conditions. Accounts receivable are considered
delinquent when they are over 90 days past due and are written off when deemed uncollectible. Recoveries of accounts receivable
previously written off are recorded in income when received.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">PROPERTY AND EQUIPMENT</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Property and equipment
are recorded at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives
of the assets, which range from 3 to 7 years.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Expenditures for maintenance
and repairs are charged to income as incurred. Additions and betterments are capitalized. The cost of properties sold or otherwise
disposed of, and the accumulated depreciation thereon, is eliminated from the property and reserve accounts, and gains and losses
are reflected in the consolidated statements of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">INCOME TAXES</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Bellsoft has elected
to be taxed as an S corporation for income tax purposes effective January 1, 2002. Accordingly, the shareholders are responsible
for income taxes; therefore, no provision for income taxes is included in these financial statements for Bellsoft, Inc.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Bellsoft&rsquo;s policy
is to distribute dividends to provide funds for shareholders to pay income taxes on income reported by the Company. Periodically,
additional distributions are paid to reduce equity in excess of management&rsquo;s evaluation of the amount required for working
capital. Management believes the payment of additional distributions will not negatively impact profitability or impair the operating
needs of the Company. Equity distributions during the years ended December 31, 2014 and 2013 were $193,124 and $2,210,430, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31, 2014 and 2013</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company accounts
for the effect of any uncertain tax positions based on a more likely than not threshold to the recognition of the tax positions
being sustained based on the technical merits of the position under scrutiny by the applicable taxing authority. If a tax position
or positions are deemed to result in uncertainties of those positions, the unrecognized tax benefit is estimated based on a cumulative
probability assessment that aggregates the estimated tax liability for all uncertain tax positions. Interest and penalties assessed,
if any, are accrued as income tax expense.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has evaluated
its tax positions and determined no uncertainty requires recognition. The Company files income tax returns in the U.S. federal
jurisdiction, and various state jurisdictions, as well as the required foreign countries. The Company is generally no longer subject
to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">ADVERTISING COSTS</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Advertising costs are
charged to operations when incurred. Advertising expense were $25,069 and $54,429 for the years ended December 31, 2014 and 2013.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 3 - ACCOUNTS RECEIVABLE</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Accounts receivable
as of December 31, 2014 and 2013 are summarized as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">Amounts due for services rendered and billed:</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2013</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 24.2pt">Outstanding less than 90 days</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,404,399</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,539,564</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 24.2pt">Outstanding more than 90 days</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,404,399</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,539,564</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 24.2pt">Less: allowance for doubtful accounts</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(19,608</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Amounts due for services rendered and billed, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,384,791</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,539,564</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 2.2pt">Amounts due for services rendered not billed:</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">847,812</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">334,427</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 46.2pt">Accounts receivable, net</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,232,603</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,873,991</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 4 - PROPERTY AND EQUIPMENT</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Property and equipment
consists of the following at December 31,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2013</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left; padding-left: 2.2pt">Computer equipment</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">169,329</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">180,262</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Furniture and fixtures</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">50,321</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">73,006</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Office premises - India</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">44,181</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">56,292</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-left: 2.2pt">Software</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">72,988</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">90,019</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Office equipment</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">70,235</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">110,392</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 2.2pt">Leasehold improvements</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,194</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,194</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 35.2pt">Fixed assets, gross</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">411,248</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">514,165</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 13.2pt">Less: accumulated depreciation</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(299,392</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(416,115</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 35.2pt">Fixed assets, net</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">111,856</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">98,050</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Depreciation expense
for the years ended December 31, 2014 and 2013 were $24,040 and $47,320, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 5 - LINE OF CREDIT</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Bellsoft had a revolving
line of credit based on an agreement dated May 13, 2011 with a current maturity date of October 30, 2015. The line of credit had
a maximum borrowing base of $2,000,000 with the interest rate at BBA Libor Daily Floating plus 2.75%. The line was secured by (1)
a shareholders&rsquo; personal guaranty and (2) a lien on all business assets of the Borrower including, but not limited to, accounts
receivable, fixed assets and general intangible assets. The line of credit required Bellsoft, Inc. to meet certain financial and
non- financial covenants which is typical to such agreements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31, 2014 and 2013</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The outstanding balance
of the line of credit was $500,000 and $1,750,000 at December 31, 2014 and 2013, respectively. Interest was accrued at 2.919% at
December 31, 2014 and 2013. Total interest expense for the years ended December 31, 2014 and 2013 were $28,578 and $26,970, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The outstanding balance
of the line of credit was fully paid off and cancelled subsequent to the share purchase agreement entered into by the Company and
Ameri Holdings, Inc. (See Note 11).</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 6 - INCOME TAXES</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company accounts
for income taxes under the provisions of the FASB ASC 740, Income Taxes. Current income tax expense consists of the following for
the years ended December 31, 2014 and 2013:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">Foreign income tax:</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2013</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; padding-left: 12.1pt">Canada</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">8,848</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">29,953</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt; padding-left: 12.1pt">India</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8,344</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">23,173</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 2.2pt">Total current income tax expense</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">17,192</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">53,126</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In the ordinary course
of business, there are many intercompany transactions that affect the calculation and estimation of the Company&rsquo;s tax liability.
Although the Company&rsquo;s management believes that their tax estimates are reasonable, there is no assurance that the final
determination of tax liability will not be different from what is reflected in the Company&rsquo;s income tax provisions and accruals.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 7 - EMPLOYEE BENEFIT PLAN</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Bellsoft maintains
a defined contribution 401K plan covering all eligible employees of Bellsoft, Inc. Employees 21 years of age are eligible to participate
in the plan after six months of service. Employees are allowed to contribute up to the maximum amount under the Internal Revenue
Code. The plan allows Bellsoft to make a discretionary match of employee contributions. During 2014 and 2013, Bellsoft contributed
$12,164 and $17,209, respectively, to the Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 8 - RECENT ACCOUNTING PRONOUNCEMENTS</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">i) On May 28, 2014,
the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606), with an effective date
for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, for public
business entities, certain not-for-profit entities, and certain employee benefit plans. The effective date for all other entities
was for annual reporting periods beginning after December 15, 2017, and interim periods within annual periods beginning after December
15, 2018.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The amendments in this
Update defer the effective date of Update 2014-09. Public business entities, certain not-for-profit entities, and certain employee
benefit plans should apply the guidance in Update 2014-09 to annual reporting periods beginning after December 15, 2017, including
interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning
after December 15, 2016, including interim reporting periods within that reporting period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">All other entities
should apply the guidance in Update 2014-09 to annual reporting periods beginning after December 15, 2018, and interim reporting
periods within annual reporting periods beginning after December 15, 2019. Earlier application is permitted only as of an annual
reporting period beginning after December 15, 2016, including interim reporting periods within that reporting period, or an annual
reporting period beginning after December 15, 2016, and interim reporting periods within annual reporting periods beginning one
year after the annual reporting period in which an entity first applies the guidance in Update 2014-09.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">ii) In January 2015,
the FASB issued Accounting Standard Update, or ASU, 2015-01-Income Statement-Extraordinary and Unusual Items, which seeks to simplify
income statement presentation by eliminating the concept of Extraordinary Items. This Update eliminates from GAAP the concept of
extraordinary items. Subtopic 225-20, Income Statement&mdash;Extraordinary and Unusual Items, required that an entity separately
classify, present, and disclose extraordinary events and transactions. The amendments in this Update are effective for fiscal years,
and interim periods within those fiscal years, beginning after December 15, 2015. A reporting entity may apply the amendments prospectively.
A reporting entity also may apply the amendments retrospectively to all prior periods presented in the financial statements. Early
adoption is permitted provided that the guidance is applied from the beginning of the fiscal year of adoption.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31, 2014 and 2013</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 9 - OPERATING LEASES</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Bellsoft leases office
space in Lawrenceville, Georgia under a net operating lease agreement. Lease expense for leased property has been accounted for
under the operating lease method where ownership of the asset does not transfer to the lessee. The lease agreement has expired
and the Company is a tenant at will on a month to month basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Bellsoft India leases
office facilities in Chennai, India under a month to month net operating lease agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Bellsoft Canada does
not maintain office space.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Operating lease expense
was $107,377 and $150,809 for the years ended December 31, 2014 and 2013.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 10 - CONCENTRATION OF CREDIT RISK</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">For the years ended
December 31, 2014 and 2013, approximately 80% and 88% of Bellsoft&rsquo;s revenue was derived from five customers. As of December
31, 2014 and 2013, approximately 70% and 78% of the Bellsoft&rsquo;s accounts receivable were due from four and three customers
respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">For the years ended
December 31, 2014 and 2013, 100% of Bellsoft Canada&rsquo;s revenue was derived from two customers. As of December 31, 2014 and
2013, 100% and 96% of the Bellsoft Canada&rsquo;s accounts receivable were due from two customers, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">At times the Company
may have bank deposits in excess of the maximum amount of U.S. Federal or Canada deposit insured limits (FDIC and CDIC, respectively).
As of December 31, 2014 and 2013, Bellsoft had approximately $671,000 and $1,795,000, respectively in unsecured cash reserves on
deposit in excess of FDIC limit; Bellsoft Canada had approximately $127,000 and $130,000, respectively, in unsecured cash reserve
on deposit in excess of CDIC limit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 11 - SUBSEQUENT EVENTS</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has evaluated
subsequent events through January 21, 2016, the date the consolidated financial statements were available to be issued.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On November 20, 2015,
the Company entered into a share purchase agreement with Ameri Holdings, Inc. (&lsquo;&ldquo;AMERI&rdquo;) based in Princeton,
New Jersey, for the consideration listed below. For financial accounting purposes, the Company recognizes September 1, 2015 as
the effective date of the disposition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The purchase price
for the acquisition of the Company consisted of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">1. A cash payment in
the amount of $3,000,000 at closing,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">2. 235,295 shares of
AMERI&rsquo;s common stock issued at closing,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">3. $250,000 quarterly
cash payments to be paid on the last day of each calendar quarter of 2016,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">4. a $1,000,000 cash
reimbursement to be paid 5 days following closing to compensate the sellers of the Company for a portion of the Company&rsquo;s
approximate cash balance as of September 1, 2015,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31, 2014 and 2013</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">5. approximately $2,500,000
to be paid and the amount confirmed within 30 days of closing in connection with the excess of the Company&rsquo;s accounts receivable
over its accounts payable as of September 1, 2015, and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">6. earn-out payments
of approximately $500,000 a year for 2016 and 2017, if earned through the achievement of annual revenue and EBITDA targets specified
in the purchase agreement, subject to downward or upward adjustment depending on actual results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Simultaneously with
the acquisition of the Company, Bellsoft entered into a Revolving Credit and Security Agreement (the &ldquo;Credit Facility&rdquo;)
with Federal National Payables, Inc., a Delaware corporation doing business as Federal National Commercial Credit (the &ldquo;Lender&rdquo;).
Up to $6 million principal amount of advances may be extended under the Credit Facility. The Credit Facility will be used to pay
a portion of the costs associated with the acquisition of Bellsoft, with the balance being available for general working capital
of Bellsoft. The Credit Facility has a term of two years, which will automatically renew unless a written notice of termination
is given by Bellsoft or the Lender to the other at least 60 days prior to the end of the original or any renewed term. Interest
under the Credit Facility will accrue on the higher of (a) the outstanding principal amount of advances under the Credit Facility
and (b) $2,000,000 at a per annum rate equal to the Prime Rate plus 1.00%, which will be payable monthly in arrears. With each
payment of interest, Bellsoft will also pay a servicing fee of 0.38% multiplied by the higher of (a) the average daily principal
amount of advances under the Credit Facility for the previous calendar month or portion thereof and (b) $2,000,000. The Credit
Facility is secured by substantially all of Bellsoft&rsquo;s assets. The amounts borrowed by Bellsoft under the Credit Facility
are guaranteed by AMERI.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>


<P STYLE="margin-top: 0; text-align: center; margin-bottom: 0"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="margin-top: 0; text-align: center; margin-bottom: 0"><B>Unaudited Condensed Consolidated Balance Sheets</B></P>

<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">September 30,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD COLSPAN="9" STYLE="font-size: 10pt; font-weight: bold; text-align: center">ASSETS:</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;&nbsp;&nbsp;Current assets:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; padding-left: 2.2pt">&nbsp;Cash</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,443,375</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,142,197</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Accounts receivable, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,640,847</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,853,725</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Employee advances</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,314</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,500</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 2.2pt">Prepaid expenses</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8,718</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,386</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 2.2pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,101,254</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,005,808</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;&nbsp;&nbsp;Property and equipment, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">121,585</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">118,155</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;&nbsp;&nbsp;Other assets:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Security deposits</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">30,440</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">88,082</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 2.2pt">Loan receivable</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">48,026</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">53,406</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 22pt; padding-left: 2.2pt">Total other assets</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">78,466</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">141,488</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Total Assets</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">7,301,305</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">5,265,451</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center">LIABILITIES AND STOCKHOLDER&rsquo;S EQUITY:</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;&nbsp;&nbsp;Liabilities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Current liabilities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Accounts payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1,344,434</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">856,989</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,574,255</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,223,890</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Customer advances</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">19,663</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">211,971</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt; padding-left: 2.2pt">Line of credit</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">250,000</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">250,000</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 2.2pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,188,352</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,542,850</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">&nbsp;&nbsp;&nbsp;Note payable - related party</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">56,890</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8,351</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;&nbsp;&nbsp;Stockholder&rsquo;s equity:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Common stock, no par, authorized 10,000 shares, issued and outstanding 750 shares</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">102,875</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">102,875</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Accumulated other comprehensive loss</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(109,162</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(34,755</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Non-controlling interest</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">68,503</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">69,145</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 2.2pt">Retained earnings</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,993,847</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,576,985</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 2.2pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total stockholder&rsquo;s equity</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,056,063</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,714,250</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Total Liabilities and Stockholder&rsquo;s Equity</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">7,301,305</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">5,265,451</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See notes to the unaudited condensed consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>


<P STYLE="margin-top: 0; text-align: center; margin-bottom: 0"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="margin-top: 0; text-align: center; margin-bottom: 0"><B>Unaudited Condensed Consolidated Statements of Comprehensive
Income</B></P>

<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Three months ended <BR>September 30,</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Nine months ended <BR>September 30,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 40%; font-size: 10pt">REVENUE</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">7,486,339</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">5,698,603</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">20,196,231</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">15,074,567</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">OPERATING EXPENSES:</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">6,771,600</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,373,424</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">18,505,634</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">14,002,719</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;INCOME FROM OPERATIONS</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">714,739</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">325,179</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,690,597</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,071,848</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">OTHER INCOME (EXPENSES)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 11pt">&nbsp;&nbsp;Other income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">808</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,449</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">808</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,449</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 11pt">&nbsp;&nbsp;Interest expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(4,776</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(4,526</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(14,312</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(26,500</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 11pt">&nbsp;&nbsp;Foreign currency gain (loss)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">862</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(93,341</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(176,606</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 11pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other expense</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(3,107</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,077</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(106,845</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(200,657</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">NET INCOME</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">711,632</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">323,102</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,583,752</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">871,191</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Net income, non-controlling interest</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8,384</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">15,643</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">18,279</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">12,185</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Net income, controlling interest</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">720,016</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">338,745</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,602,031</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">883,376</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Other comprehensive income (loss):</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 11pt">Foreign currency translation&nbsp;&nbsp;&nbsp;adjustment</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,952</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">78,068</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">18,703</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">34,149</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt">Comprehensive income</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">728,968</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">416,813</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,620,734</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">917,525</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See notes to the unaudited condensed consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>


<P STYLE="margin-top: 0; text-align: center; margin-bottom: 0"><B>&nbsp;BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="margin-top: 0; text-align: center; margin-bottom: 0"><B>Unaudited Condensed Consolidated Statements of Cash Flows</B></P>

<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Three months ended <BR>September 30,</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Nine months ended <BR>September 30,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CASH FLOWS FROM OPERATING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 48%; font-size: 10pt; text-align: left; text-indent: 11pt">Net income</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">720,016</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">338,745</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">1,602,031</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">883,376</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 11pt">Adjustments to reconcile net income to net cash&nbsp;&nbsp;provided by operating activities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-indent: 22pt">Depreciation</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,489</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,163</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">7,467</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">12,490</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 22pt">Changes in assets and liabilities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 33pt">Accounts receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(791,954</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(654,554</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,408,244</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(979,732</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 33pt">Employee advances</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,050</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,800</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,200</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 33pt">Prepaid expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,400</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(4,114</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">52,311</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 33pt">Other receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(2,925</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(47,582</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 33pt">Security deposits</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">55,476</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">214</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 33pt">Accounts payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">302,481</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,113</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">193,572</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">125,164</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 33pt">Accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">28,228</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">336,501</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">97,156</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">95,926</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 33pt">Customer advances</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(70,107</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 33pt">Income tax payable</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(21,143</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(29,953</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 33pt">Net cash provided by operating activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">273,710</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">34,168</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">447,969</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">115,214</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CASH FLOWS FROM INVESTING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 11pt">&nbsp;&nbsp;&nbsp;Capital expenditures</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,543</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(4,872</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(17,196</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(32,595</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 33pt">Net cash used in investing activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,543</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(4,872</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(17,196</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(32,595</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CASH FLOWS FROM FINANCING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-indent: 22pt">Repayment of line of credit</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,000,000</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(850,000</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(250,000</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,500,000</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 22pt">Note payable - related party</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(36,762</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">56,890</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,351</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 22pt">Repayment of note receivable from shareholder</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">220,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 22pt">Shareholders&rsquo; distributions</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(4,505</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(657</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 22pt">Non-controlling interest net income</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(8,334</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(15,643</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(18,279</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(12,185</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 33pt">Net cash used in financing activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1,008,334</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(902,405</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(215,894</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1,284,491</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Effect of exchange rate changes on cash</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8,952</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">78,068</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">18,703</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">34,150</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net increase/(decrease) in cash</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(728,215</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(795,041</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">233,582</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,167,722</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">Cash at beginning of period</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,171,590</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,937,238</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,209,793</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,309,919</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">Cash at end of period</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,443,375</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,142,197</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,443,375</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,142,197</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Supplemental disclosure:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 33pt">Cash paid for interest</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">4,776</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">4,526</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">14,312</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">26,500</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 33pt">Cash paid for foreign income taxes</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">9,768</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">30,844</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See notes to the unaudited condensed consolidated
financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>September 30, 2015 and 2014</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 1 - NATURE OF OPERATIONS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Bellsoft, Inc. (&ldquo;Bellsoft&rdquo;),
was incorporated in the State of Georgia on March 19, 1996. The Company provides implementation and custom development services
for Enterprise Resource Planning (ERP) software.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On February 7, 2005, Bellsoft acquired
a 72% ownership interest in Bellsoft India Solutions Private (Pvt) Limited (Ltd), a company incorporated under the laws of India
(&ldquo;Bellsoft India&rdquo;). The primary purpose of Bellsoft India is to provide back office and marketing functions to Bellsoft,
Inc. Bellsoft India&rsquo;s fiscal year ends on March 31st. For consolidation purposes Bellsoft India prepares statements for the
reporting period which corresponds with the fiscal year of the parent.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On August 31, 2011, Bellsoft formed BSI
Global IT Solutions, Inc. (Bellsoft Canada), a company incorporated under the laws of Canada. The primary purpose of Bellsoft Canada
is to provide implementation and custom development services for ERP software for clients in Canada. Bellsoft owns 100% of Bellsoft
Canada.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Bellsoft India and Bellsoft Canada are
collectively referred to as the Subsidiaries. Bellsoft, Inc. and the Subsidiaries are collectively referred to as the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>BASIS OF CONSOLIDATION</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The consolidated financial statements include
the accounts of the Subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>BASIS OF PRESENTATION</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has adopted the Financial Accounting
Standards Board (&ldquo;FASB&rdquo;) Codification (&ldquo;Codification&rdquo; or &ldquo;ASC&rdquo;). The Codification is the single
official source of authoritative accounting principles generally accepted in the United States of America (&ldquo;U.S. GAAP&rdquo;)
recognized by the FASB to be applied by nongovernmental entities. All of the Codification&rsquo;s content carries the same level
of authority.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>September 30, 2015 and 2014</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>FOREIGN OPERATIONS AND FOREIGN CURRENCY</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Subsidiaries&rsquo; foreign operations
are subject to risks inherent in operating under different legal systems and various political and economic environments. Among
the risks are changes in existing tax laws, possible limitations on foreign investment and income repatriation, government price
or foreign exchange controls, and restrictions on currency exchange. Net assets of foreign operations were approximately 7% and
12% of the Company&rsquo;s total net assets at September 30, 2015 and 2014, respectively.&nbsp;Cash held in foreign based bank
accounts totaled approximately $248,701 and $342,273 at September 30, 2015 and 2014.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Subsidiaries transact business in their
local currencies. The financial statements reflect the translation of the functional currency statements to U.S. Dollars. Financial
statements use end-of-period exchange rates for assets and liabilities, weighted average exchange rates for revenues and expenses,
and historical rates for equity. The resulting foreign currency translation adjustment is recorded in accumulated other comprehensive
income (loss) as a component of equity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>USE OF ESTIMATES</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The preparation of consolidated financial
statements in conformity with U.S. GAAP 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. Actual results could differ from those estimates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>REVENUE RECOGNITION</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company recognizes revenue in accordance
with FASB ASC 985-605-25-79. Revenue is derived from time and expense contracts and is recognized as the services are performed.
Revenue received as reimbursement of billable expenses is reported on a gross basis within revenue and the related expenses are
recorded in operating expenses. Unbilled revenue is comprised of revenue recognized in relation to efforts incurred on time and
expense contracts not billed at a period end where services are performed in accordance with agreed terms. Customer advances represent
payments received in advance of an engagement and are deferred until the service is performed.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>CASH AND CASH EQUIVALENTS</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company considers all highly liquid
investments with an original maturity of three months or less to be cash equivalents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>September 30, 2015 and 2014</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>ACCOUNTS RECEIVABLE</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company routinely assesses the financial
strength of its customers and debtors and believes that its accounts receivable credit risk exposure is limited. Accounts receivable
are carried at the original invoice amount less an estimate made for doubtful receivables based on a review of all outstanding
amounts on a monthly basis. An allowance is provided for known and anticipated credit losses, as determined by management in the
course of regularly evaluating individual customer receivables. This evaluation takes into consideration a customer&rsquo;s financial
condition and credit history, as well as current economic conditions. Accounts receivable are considered delinquent when they are
over 90 days past due and are written off when deemed uncollectible. Recoveries of accounts receivable previously written off are
recorded in income when received.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>PROPERTY AND EQUIPMENT</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Property and equipment are recorded at
cost.&nbsp;Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the assets,
which range from 3 to 7 years.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Expenditures for maintenance and repairs
are charged to income as incurred.&nbsp;Additions and betterments are capitalized.&nbsp;The cost of properties sold or otherwise
disposed of, and the accumulated depreciation thereon, is eliminated from the property and reserve accounts, and gains and losses
are reflected in the consolidated statements of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>INCOME TAXES</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Bellsoft has elected to be taxed as an
S corporation for income tax purposes effective January 1, 2002.&nbsp;Accordingly, the shareholders are responsible for income
taxes; therefore, no provision for income taxes is included in these financial statements for Bellsoft, Inc.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Bellsoft&rsquo;s policy is to distribute
dividends to provide funds for shareholders to pay income taxes on income reported by the Company. Periodically, additional distributions
are paid to reduce equity in excess of management&rsquo;s evaluation of the amount required for working capital. Management believes
the payment of additional distributions will not negatively impact profitability or impair the operating needs of the Company.
Equity distributions during the periods ended September 30, 2015 and 2014 were $4,505 and $657, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company accounts for the effect of
any uncertain tax positions based on a more likely than not threshold to the recognition of the tax positions being sustained based
on the technical merits of the position under scrutiny by the applicable taxing authority.&nbsp;If a tax position or positions
are deemed to result in uncertainties of those positions, the unrecognized tax benefit is estimated based on a cumulative probability
assessment that aggregates the estimated tax liability for all uncertain tax positions.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>September 30, 2015 and 2014</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has evaluated its tax positions
and determined no uncertainty requires recognition.&nbsp;The Company files income tax returns in the U.S. federal jurisdiction,
and various state jurisdictions, as well as the required foreign countries. The Company is generally no longer subject to U.S.
federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>ADVERTISING COSTS</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Advertising costs are charged to operations
when incurred. Advertising expense was $11,624 and $17,624 for the three months ended September 30, 2015 and 2014, respectively
and $26,780 and $40,231 for the nine months ended September 30, 2015 and 2014, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>NOTE 3 - ACCOUNTS RECEIVABLE</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Accounts receivable as of September 30, 2015 and 2014 are summarized
as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">Amounts due for services rendered and billed:</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left; text-indent: 22pt">Outstanding less than 90 days</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">4,449,642</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">3,021,016</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 22pt">Outstanding more than 90 days</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(34,488</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(31,329</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,415,154</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,989,687</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 22pt">Less: allowance for doubtful accounts</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Amounts due for services rendered and billed, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,415,154</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,989,687</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Amounts due for services rendered not billed:</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,225,693</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">864,038</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 2.5pt; text-indent: 44pt">Accounts receivable, net</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">5,640,847</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">3,853,725</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt; text-align: right; font-size: 8pt"></P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>September 30, 2015 and 2014</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>NOTE 4 - PROPERTY AND EQUIPMENT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Property and equipment consists of the following at September
30,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: justify; text-indent: 11pt">Computer equipment</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">169,329</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">180,263</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify; text-indent: 11pt">Furniture and fixtures</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">59,346</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">58,455</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify; text-indent: 11pt">Office premises - India</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">60,658</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">58,670</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify; text-indent: 11pt">Software</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">73,943</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">92,932</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify; text-indent: 11pt">Office equipment</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">46,227</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">55,206</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify; padding-bottom: 1pt; text-indent: 11pt">Leasehold improvements</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,194</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,194</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify; text-indent: 44pt">Fixed assets, gross</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">413,697</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">449,719</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: justify; padding-bottom: 1pt; text-indent: 22pt">Less: accumulated depreciation</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(292,112</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(331,564</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: justify; padding-bottom: 2.5pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fixed assets, net</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">121,585</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">118,155</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Depreciation expense was $2,489 and $4,163
for the three months ended September 30, 2015 and 2014, respectively and $7,467 and $12,490 for the nine months ended September
30, 2015 and 2014, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 5 - LINE OF CREDIT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Bellsoft had a revolving line of credit
based on an agreement dated May 13, 2011 with a current maturity date of October 30, 2015.&nbsp;The line of credit had a maximum
borrowing base of $2,000,000 with the interest rate at BBA Libor Daily Floating plus 2.75%.&nbsp;The line was secured by (1) a
shareholder&rsquo;s personal guaranty and (2) a lien on all business assets of the Borrower including, but not limited to, accounts
receivable, fixed assets and general intangible assets.&nbsp;The line of credit required Bellsoft, Inc. to meet certain financial
and non-financial covenants, which is typical to such agreements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The outstanding balance of the line of
credit for the three months ended September 30, 2015 and 2014, respectively was $250,000 and $250,000 and for the nine months ended
September 30, 2015 and 2014 respectively was $250,000 and $250,000. Interest was accrued approximately at 2.94% and 2.919% at September
30, 2015 and 2014. Total interest expense for the three months period ended September 30, 2015 and 2014 was $4,776 and $4,526 and
for the nine months ended September 30, 2015 and 2014 was $14,312 and $26.500.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>September 30, 2015 and 2014</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The outstanding balance of the line of
credit was fully paid off and cancelled subsequent to the share purchase agreement entered into by the Company and Ameri Holdings,
Inc. (See Note 10)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 6 - EMPLOYEE BENEFIT PLAN</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Bellsoft maintains a defined contribution
401K plan covering all eligible employees of Bellsoft, Inc.&nbsp;Employees 21 years of age are eligible to participate in the plan
after six months of service.&nbsp;Employees are allowed to contribute up to the maximum amount under the Internal Revenue Code.&nbsp;The
plan allows Bellsoft to make a discretionary match of employee contributions.&nbsp;During the three months period ended September
30, 2015 and 2014 and the nine months ended September 30, 2015 and 2014, respectively there were no contributions to the Plan.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 7 - RECENT ACCOUNTING PRONOUNCEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">i) On May 28, 2014, the FASB issued Accounting
Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606), with an effective date for annual reporting periods
beginning after December 15, 2016, including interim periods within that reporting period, for public business entities, certain
not-for-profit entities, and certain employee benefit plans. The effective date for all other entities was for annual reporting
periods beginning after December 15, 2017, and interim periods within annual periods beginning after December 15, 2018.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The amendments in this Update defer the
effective date of Update 2014-09. Public business entities, certain not-for-profit entities, and certain employee benefit plans
should apply the guidance in Update 2014-09 to annual reporting periods beginning after December 15, 2017, including interim reporting
periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December
15, 2016, including interim reporting periods within that reporting period.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">All other entities should apply the guidance
in Update 2014-09 to annual reporting periods beginning after December 15, 2018, and interim reporting periods within annual reporting
periods beginning after December 15, 2019. Earlier application is permitted only as of an annual reporting period beginning after
December 15, 2016, including interim reporting periods within that reporting period, or an annual reporting period beginning after
December 15, 2016, and interim reporting periods within annual reporting periods beginning one year after the annual reporting
period in which an entity first applies the guidance in Update 2014-09.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>September 30, 2015 and 2014</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">ii) In January 2015, the FASB, issued Accounting
Standard Update, or ASU, 2015-01-Income Statement-Extraordinary and Unusual Items, which seeks to simplify income statement presentation
by eliminating the concept of Extraordinary Items. This Update eliminates from GAAP the concept of extraordinary items. Subtopic
225-20, Income Statement&mdash;Extraordinary and Unusual Items, required that an entity separately classify, present, and disclose
extraordinary events and transactions. The amendments in this Update are effective for fiscal years, and interim periods within
those fiscal years, beginning after December 15, 2015. A reporting entity may apply the amendments prospectively. A reporting entity
also may apply the amendments retrospectively to all prior periods presented in the financial statements. Early adoption is permitted
provided that the guidance is applied from the beginning of the fiscal year of adoption.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 8 - OPERATING LEASES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Bellsoft leases office space in Lawrenceville,
Georgia under a net operating lease agreement.&nbsp;Lease expense for leased property has been accounted for under the operating
lease method where ownership of the asset does not transfer to the lessee. The lease agreement has expired and the Company is a
tenant at will on a month to month basis.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Bellsoft India leases office facilities
in Chennai, India under a month to month net operating lease agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Bellsoft Canada does not maintain office
space.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Operating lease expense was for the three
months ended September 30, 2015 and 2014 was $33,182 and $80,852, respectively. For the nine months ended September 30, 2015 and
2014, operating lease expense was $54,443 and $118,198.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 9 - CONCENTRATION OF CREDIT RISK</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">For the three months ended September 30,
2015 and 2014, approximately 66% and 78% of Bellsoft&rsquo;s revenue was derived from four and five customers, respectively. For
the nine months ended September 30, 2015 and 2014, approximately 58% and 83% of Bellsoft&rsquo;s revenue was derived from 3 and
5 customers. As of the nine months period ending September 30, 2015 and 2014, approximately 10% and 16% of the Bellsoft&rsquo;s
accounts receivable were due from 3 and 5 customers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">For the three and nine month periods ended
September 30, 2015 and 2014, 100% of Bellsoft Canada&rsquo;s revenue was derived from two customers. As of September 30, 2015 and
2014, 100% of the Bellsoft Canada&rsquo;s accounts receivable were due from two customers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>BELLSOFT, INC. AND SUBSIDIARIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>September 30, 2015 and 2014</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">At times the Company may have bank deposits
in excess of the maximum amount of U.S. Federal or Canada deposit insured limits (FDIC and CDIC, respectively). As of September
30, 2015 and 2014, Bellsoft had approximately $1,193,375 and $892,197 in unsecured cash reserves on deposit in excess of FDIC limit;
Bellsoft Canada had approximately $131,000 and $127,000, respectively, in unsecured cash reserve on deposit in excess of the CDIC
limit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 10 - SUBSEQUENT EVENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has evaluated subsequent events
through January 25, 2016, the date the consolidated financial statements were available to be issued.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On November 20, 2015, the Company entered
into a share purchase agreement with Ameri Holdings Inc. (&lsquo;AMERI&rsquo;) based in Princeton, New Jersey, for the consideration
listed below. For financial accounting purposes, the Company recognizes September 1, 2015 as the effective date of the disposition.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The purchase price of the acquisition of
the Company consisted of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">1. A cash payment in the amount of $3,000,000
at closing,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">2. 235,295 shares of AMERI&rsquo;s common
stock issued at closing,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">3. $250,000 quarterly cash payments to
be paid on the last day of each calendar quarter of 2016,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">4. a $1,000,000 cash reimbursement to be
paid 5 days following closing to compensate the sellers of the Company for a portion of the Company&rsquo;s approximate cash balance
as of September 1, 2015,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">5. approximately $2,500,000 to be paid
and the amount confirmed within 30 days of closing in connection with the excess of the Company&rsquo;s accounts receivable over
its accounts payable as of September 1, 2015, and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">6. earn-out payments of approximately $500,000
a year for 2016 and 2017, if earned through the achievement of annual revenue and EBITDA targets specified in the Bellsoft purchase
agreement, subject to downward or upward adjustment depending on actual results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Simultaneously with the acquisition of
the Company, Bellsoft entered into a Revolving Credit and Security Agreement (the &ldquo;Credit Facility&rdquo;) with Federal National
Payables, Inc., a Delaware corporation doing business as Federal National Commercial Credit (the &ldquo;Lender&rdquo;). Up to $6
million principal amount of advances may be extended under the Credit Facility. The Credit Facility will be used to pay a portion
of the costs associated with the acquisition of Bellsoft, with the balance being available for general working capital of Bellsoft.
The Credit Facility has a term of two years, which will automatically renew unless a written notice of termination is given by
Bellsoft or the Lender to the other at least 60 days prior to the end of the original or any renewed term. Interest under the Credit
Facility will accrue on the higher of (a) the outstanding principal amount of advances under the Credit Facility and (b) $2,000,000
at a per annum rate equal to the Prime Rate plus 1.00%, which will be payable monthly in arrears. With each payment of interest,
Bellsoft will also pay a servicing fee of 0.38% multiplied by the higher of (a) the average daily principal amount of advances
under the Credit Facility for the previous calendar month or portion thereof and (b) $2,000,000. The Credit Facility is secured
by substantially all of Bellsoft&rsquo;s assets. The amounts borrowed by Bellsoft under the Credit Facility are guaranteed by AMERI.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">CERTIFIED PUBLIC ACCOUNTANTS REPORT
OF INDEPENDENT<BR>
REGISTERED PUBLIC ACCOUNTING FIRM</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Board of Members,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have audited the
accompanying balance sheets of DC&amp;M Partners, L.L.C. (the &ldquo;Company&rdquo;) as of December 31, 2015 and 2014 and the related
statements of income, retained earnings and cash flows for the years then ended. These financial statements are the responsibility
of the Company&rsquo;s management. Our responsibility is to express an opinion on these financial statements based on our audits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We conducted our audits
in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the 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&rsquo;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 audits provide a reasonable basis for our opinion.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In our opinion, the
financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December
31, 2015 and 2014 and the results of its operations and its cash flows for the years then ended, in conformity with accounting
principles generally accepted in the United States of America.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">/s/ Ram Associates</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Ram Associates<BR>
Hamilton, NJ<BR>
October 11, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">3240 EAST STATE STREET EXT. + HAMILTON,
NJ08619 + (609) 631-9552/63 1-9553 + FAX (888) 319-8898<BR>
PKRAM@RAMASSOCIATES.US</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">DC&amp;M PARTNERS L.L.C.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">Balance Sheets</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">December 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2014</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center">ASSETS</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CURRENT ASSETS</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,171,274</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,402,294</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Accounts receivable, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,940,153</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,610,165</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Prepaid expenses</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">47,181</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">45,709</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 55pt">TOTAL CURRENT ASSETS</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,158,608</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,058,168</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">PROPERTY AND EQUIPMENT, NET</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,780</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">OTHER ASSETS</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Security deposits</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,263</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,263</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Other assets</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,406</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">42,063</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 55pt">TOTAL OTHER ASSETS</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">6,669</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">43,326</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">TOTAL ASSETS</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">5,167,057</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">4,101,494</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center">LIABILITIES AND MEMBERS&rsquo; EQUITY</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CURRENT LIABILITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Accounts payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">2,541,090</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">1,531,271</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,398</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,833</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Income tax payable</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">79,667</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">54,370</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 55pt">TOTAL CURRENT LIABILITIES</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,623,155</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,589,474</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">LONG-TERM LIABILITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Deferred Compensation</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">449,469</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">449,469</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 55pt">TOTAL CURRENT AND LONG-TERM LIABILITIES</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,072,624</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,038,943</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">MEMBERS&rsquo; EQUITY</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,094,433</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,062,551</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 55pt">TOTAL MEMBERS&rsquo; EQUITY</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,094,433</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,062,551</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">TOTAL LIABILITIES AND MEMBERS&rsquo; EQUITY</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">5,167,057</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">4,101,494</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See accompanying notes to financial statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">DC&amp;M PARTNERS, L.L.C.<BR>
Statements of Income and Comprehensive Income</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Year Ended December 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2014</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; font-weight: bold">REVENUES</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">17,865,584</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">16,341,331</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">COST OF SALES</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">14,518,816</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">13,477,468</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Gross profit</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,346,768</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,863,863</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">&nbsp;<B>OPERATING EXPENSES</B></TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,182,795</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,825,362</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Income from operations</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,163,973</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,038,501</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-left: 2.2pt">OTHER INCOME (EXPENSES)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Interest income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">263</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">293</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Other income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">9,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">9,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Interest expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(117</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(25</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 19.8pt">TOTAL OTHER EXPENSE</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">9,146</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">9,268</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-left: 2.2pt">Income before income tax expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,173,119</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,047,769</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22.5pt">Income tax expense</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">87,180</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">34,660</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,085,939</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,013,109</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-left: 2.2pt">Other comprehensive income (loss):</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Foreign currency translation adjustment</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(7,251</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">&nbsp;Net income</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,085,939</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,005.858</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See accompanying notes to financial statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">DC&amp;M PARTNERS, L.L.C.<BR>
Statement of Members&rsquo; Equity</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">MACT</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">Lucid</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Holdings,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>LLC</B></P></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Housenkens LLC</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Solutions,</B></P> <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Inc.</B></P></TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Total</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 40%; font-size: 10pt">Balance at December 31, 2013</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">631,252</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">632,192</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">632,433</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,895,877</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Net Income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">352,050</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">352,050</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">301,758</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,005,858</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Member Distributions</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(279,728</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(279,728</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(279,728</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(839,184</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">Balance at December 31, 2014</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">703,574</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">704,514</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">654,463</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,062,551</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Net Income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">380,079</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">380,079</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">325,781</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,085,939</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Member Distributions</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(351,352</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(351,352</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(351,353</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1,054,057</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">Balance at December 31, 2015</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">732,301</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">733,241</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">628,891</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">2,094,433</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See accompanying notes to financial statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">DC&amp;M PARTNERS, L.L.C.<BR>
Statements of Cash Flows</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Year Ended December 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2014</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CASH FLOWS FROM OPERATING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left; padding-left: 11pt">Net income</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,085,939</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,005,858</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 11pt">Adjustments to reconcile net income to net cash provided by operating activities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-left: 22pt">Depreciation</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">511</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,727</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Changes in assets and liabilities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,329,988</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(95,838</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 33pt">Prepaid expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,472</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(7,834</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 33pt">Note receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">39,157</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 33pt">Other assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(2,500</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 33pt">Accounts payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,009,819</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">218,989</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 33pt">Accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,434</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,131</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 33pt">Income tax payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">25,296</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">12,569</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 33pt">Long term deferred compensation</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(5,000</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 33pt">Net cash provided by operating activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">825,328</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,130,934</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CASH FLOWS FROM INVESTING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 33pt">Capital expenditures</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,291</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1,668</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 33pt">Net cash provided by/(used in) investing activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,291</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1.668</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CASH FLOWS FROM FINANCING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 33pt">Partner distributions</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1,054,057</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(839,184</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 33pt">Net cash used in financing activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1,054,057</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(839,184</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net decrease in cash and cash equivalents</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(231,020</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">291,750</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Cash at beginning of year</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,402,294</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,110,544</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Cash at end of year</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,171,274</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,402,294</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See accompanying notes to financial statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">DC&amp;M PARTNERS, L.L.C.<BR>
Notes to Financial Statements<BR>
December 31, 2015 and 2014</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 1 - NATURE OF OPERATIONS</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">DC&amp;M Partners,
L.L.C. (the &ldquo;Company&rdquo;), was formed in the State of Arizona on January 29, 2007. The Company provides clients with a
wide range of SAP development, consultancy and management services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">BASIS OF PRESENTATION</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has adopted
the Financial Accounting Standards Board (&ldquo;FASB&rdquo;) Codification (&ldquo;Codification&rdquo; or &ldquo;ASC&rdquo;). The
Codification is the single official source of authoritative accounting principles generally accepted in the United States of America
(&ldquo;U.S. GAAP&rdquo;) recognized by the FASB to be applied by nongovernmental entities. All of the Codification&rsquo;s content
carries the same level of authority.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">USE OF ESTIMATES</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The preparation of
financial statements in conformity with U.S. GAAP 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. Actual results could differ from those estimates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">REVENUE RECOGNITION</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company recognizes
revenue in accordance with FASB ASC 985-605-25-79. Revenue is derived from time and expense contracts and is recognized as the
services are performed. Revenue received as reimbursements of billable expenses are reported gross within revenue and the related
expenses are recorded in operating expenses. Unbilled revenue comprises of revenue recognized in relation to efforts incurred on
time and expense contracts not billed at period end where services are performed in accordance with agreed terms. Customer advances
represent payments received in advance of an engagement and are deferred until the service is performed.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">CASH AND CASH EQUIVALENTS</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company considers
all highly liquid investments with an original maturity of three months or less to be cash equivalents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">ACCOUNTS RECEIVABLE</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company routinely
assesses the financial strength of its customers and debtors and believes that its accounts receivable credit risk exposure is
limited. Accounts receivable are carried at the original invoice amount less an estimate made for doubtful receivables based on
a review of all outstanding amounts on a monthly basis. An allowance is provided for known and anticipated credit losses, as determined
by management in the course of regularly evaluating individual customer receivables. This evaluation takes into consideration a
customer&rsquo;s financial condition and credit history, as well as current economic conditions. Accounts receivable are considered
delinquent when they are over 90 days past due and are written off when deemed uncollectible. Recoveries of accounts receivable
previously written off are recorded in income when received.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">PROPERTY AND EQUIPMENT</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Property and equipment
are recorded at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives
of the assets, which range from 3 to 7 years.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><B>DC&amp;M PARTNERS,
L.L.C.<BR>
Notes to Financial Statements<BR>
December 31, 2015 and 2014</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Expenditures for maintenance
and repairs are charged to income as incurred. Additions and betterments are capitalized. The cost of properties sold or otherwise
disposed of, and the accumulated depreciation thereon, is eliminated from the property and reserve accounts, and gains and losses
are reflected in the consolidated statements of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">INCOME TAXES</P>

<P STYLE="font: italic bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company elected
to be taxed as a partnership for income tax purposes effective June 3, 2001. Accordingly, the members are responsible for income
taxes and no provision for income taxes is included in these financial statements for the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company&rsquo;s
policy is to distribute dividends to provide funds for members to pay income taxes on income reported by the Company. Periodically,
additional distributions are paid to reduce equity in excess of management&rsquo;s evaluation of the amount required for working
capital. Management believes the payment of additional distributions will not negatively impact profitability or impair the operating
needs of the Company. Equity distributions during the years ended December 31, 2015 and 2014 were $1,054,057 and $839,184, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company accounts
for the effect of any uncertain tax positions based on a more likely than not threshold to the recognition of the tax positions
being sustained based on the technical merits of the position under scrutiny by the applicable taxing authority. If a tax position
or positions are deemed to result in uncertainties of those positions, the unrecognized tax benefit is estimated based on a cumulative
probability assessment that aggregates the estimated tax liability for all uncertain tax positions. Interest and penalties assessed,
if any, are accrued as income tax expense.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has evaluated
its tax positions and determined no uncertainty requires recognition. The Company files income tax returns in the U.S. federal
jurisdiction, and various state jurisdictions, as well as the required foreign countries. The Company is generally no longer subject
to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 3 - ACCOUNTS RECEIVABLE</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">Amounts due for services rendered and billed:</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Outstanding less than 90 days</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,843,137</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,763,589</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Outstanding more than 90 days</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">97,016</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(153,424</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,940,153</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,610,165</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Less: allowance for doubtful accounts</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Amounts due for services rendered and billed, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,940,153</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,610,165</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Amounts due for services rendered not billed:</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Accounts receivable, net</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,940,153</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,610,165</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 4 - PROPERTY AND EQUIPMENT</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2014</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">Office equipment</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">54,829</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">52,538</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Fixed assets, gross</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">54,829</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">52,538</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Less: accumulated depreciation</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(53,049</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(52,538</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Fixed assets, net</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,780</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Depreciation expense
for the years ended December 31, 2014 and 2015 were $511 and $1,780, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt; text-align: right; font-size: 8pt"></P></DIV>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>DC&amp;M PARTNERS, L.L.C.</B><BR>
<B>Notes to Financial Statements</B><BR>
<B>December 31, 2015 and 2014</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 5 - INCOME TAXES</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company accounts
for income taxes under the provisions of the FASB ASC 740, Income Taxes. Although the Company&rsquo;s management believes that
their tax estimates are reasonable, there is no assurance that the final determination of tax liability will not be different from
what is reflected in the Company&rsquo;s income tax provisions and accruals.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Income tax expense
for the years ended December 31, 2015 and 2014 were $87,180 and $34,660, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 6 - DEFERRED COMPENSATION</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company reviews
compensation for members on an annual basis and accrues deferred compensation for any excess of amounts owed versus amounts paid
to members. As of December 31, 2015 and 2014, deferred compensation was $449,469 and $449,469, respectively. All dues were paid
off as of the report date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 7 - RECENT ACCOUNTING PRONOUNCEMENTS</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In August 2014, the
FASB issued amended guidance related to disclosure of uncertainties about an entity&rsquo;s ability to continue as a going concern.
The new guidance requires management to evaluate whether there is substantial doubt about the entity&rsquo;s ability to continue
as a going concern and, as necessary, to provide related footnote disclosures. The guidance has an effective date of December 31,
2016. The Company believes that the adoption of this new standard will not have a material impact on its financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In May 2014, the FASB
issued Accounting Standard Update, or ASU, 2014-09-Revenue from Contracts with Customers, which provides a single, comprehensive
revenue recognition model for all contracts with customers. The core principal of this ASU is that an entity should recognize revenue
when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects
to be entitled in exchange for those goods or services. This ASU also requires additional disclosure about the nature, amount,
timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in
judgments and assets recognized from costs incurred to obtain or fulfill a contract. This ASU is effective for annual periods,
and interim periods within those annual periods, beginning after December 15, 2016. Early adoption is not permitted. The Company
is currently evaluating the impact this ASU will have on its financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In January 2015, the
FASB issued ASU 2015-01-Income Statement-Extraordinary and Unusual Items, which seeks to simplify income statement presentation
by eliminating the concept of Extraordinary Items. This ASU eliminates from U.S. GAAP the concept of extraordinary items. Subtopic
225-20, Income Statement&mdash;Extraordinary and Unusual Items, required that an entity separately classify, present, and disclose
extraordinary events and transactions. The amendments in this ASU are effective for fiscal years, and interim periods within those
fiscal years, beginning after December 15, 2015. A reporting entity may apply the amendments prospectively. A reporting entity
also may apply the amendments retrospectively to all prior periods presented in the financial statements. Early adoption is permitted
provided that the guidance is applied from the beginning of the fiscal year of adoption.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">In November 20, 2015,
the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes. The ASU is part of the FASB&rsquo;s simplification
initiative aimed at reducing complexity in accounting standards. Current U.S. GAAP requires the deferred taxes for each jurisdiction
(or tax-paying component of a jurisdiction) to be presented as a net current asset or liability and net noncurrent asset or liability.
This requires a jurisdiction-by-jurisdiction analysis based on the classification of the assets and liabilities to which the underlying
temporary differences relate, or, in the case of loss or credit carryforwards, based on the period in which the attribute is expected
to be realized. Any valuation allowance is then required to be allocated on a pro rata basis, by jurisdiction, between current
and noncurrent deferred tax assets. To simplify presentation, the new guidance requires that all deferred tax assets and liabilities,
along with any related valuation allowance, be classified as noncurrent on the balance sheet. As a result, each jurisdiction will
now only have one net noncurrent deferred tax asset or liability. Importantly, the guidance does not change the existing requirement
that only permits offsetting within a jurisdiction &ndash; that is, companies are still prohibited from offsetting deferred tax
liabilities from one jurisdiction against deferred tax assets of another jurisdiction.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>DC&amp;M PARTNERS, L.L.C.</B><BR>
<B>Notes to Financial Statements</B><BR>
<B>December 31, 2015 and 2014</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 8 - OPERATING LEASES</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company leases
office space in Chandler, Arizona under net operating lease agreement. Lease expense for leased property has been accounted for
under the operating lease method where ownership of the asset does not transfer to the lessee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Operating lease expense
was $46,709 and $29,991 for the years ended December 31, 2015 and 2014, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 9 - CONCENTRATION OF CREDIT RISK</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">For the years ended
December 31, 2015 and 2014, approximately 62% and 64%, respectively, of the Company&rsquo;s revenue was derived from five customers.
As of December 31, 2015 and 2014, approximately 79% and 72%, respectively, of the Company&rsquo;s accounts receivable were due
from five and four customers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">At times the Company
may have bank deposits in excess of the maximum amount of U.S. federal deposit insured limits (FDIC). As of December 31, 2015 and
2014, the Company had approximately $1,081,000 and $1,312,000, respectively, in unsecured cash reserves on deposit in excess of
the FDIC limit.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">NOTE 10 - SUBSEQUENT EVENTS</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The Company has evaluated
subsequent events through October 11, 2016, the date the financial statements were available to be issued.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">On July 29, 2015, the
Company entered into a membership interest purchase agreement with Ameri Holdings Inc. (&ldquo;AMERI&rdquo;), which is based in
Princeton, New Jersey, for the purchase of all of the outstanding membership interests of the Company for consideration of: (a)
a cash payment in the amount of $3,000,000 at closing, (b) 1,600,000 shares of AMERI common stock, which are to be issued on July
29, 2018 or upon a change of control of AMERI (whichever occurs earlier), and (c) earn-out payments to be paid, if earned, in 2017
and 2018, all as more particularly outlined in the purchase agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR>
    <TD STYLE="width: 100%">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>DC&amp;M PARTNERS, L.L.C.</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Unaudited Condensed Balance
Sheets</B>&nbsp;</P></TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD COLSPAN="9" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">June 30,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center">ASSETS</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: right">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CURRENT ASSETS</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; padding-left: 22pt">Cash</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">2,570,828</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,168,970</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Accounts receivable, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,206,166</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,745,437</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Prepaid expenses</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">21,000</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">27,663</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">TOTAL CURRENT ASSETS</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,797,994</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,942,070</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">PROPERTY AND EQUIPMENT, NET</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,141</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,865</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">OTHER ASSETS</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Security deposits</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,263</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,263</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Note receivable from member</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">34,925</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Other assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,138</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">TOTAL OTHER ASSETS</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,263</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">47,326</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">TOTAL ASSETS</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">5,803,398</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">4,991,261</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: center">LIABILITIES AND MEMBERS&rsquo; EQUITY</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CURRENT LIABILITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Accounts payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">2,750,030</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">2,238,145</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,399</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Income tax payable</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">67,418</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 19.8pt">TOTAL CURRENT LIABILITIES</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,750,030</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,307,962</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: 9.9pt">LONG TERM LIABILITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Deferred Compensation</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">597,481</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">449,469</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">TOTAL CURRENT AND LONG-TERM LIABILITIES</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,347,511</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,757,431</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">MEMBERS&rsquo; EQUITY</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Members&rsquo; Equity</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,455,887</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,233,830</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">TOTAL MEMBERS&rsquo; EQUITY</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,455,887</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,233,830</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">TOTAL LIABILITIES AND MEMBERS&rsquo; EQUITY</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">5,803,398</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">4,991,261</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See accompanying notes to unaudited condensed&nbsp;financial
statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>DC&amp;M PARTNERS, L.L.C.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Unaudited Condensed Statements of Income
and Comprehensive Income</B></P>

<P STYLE="margin-top: 0pt; text-align: center; margin-bottom: 0pt"><B>Three&nbsp;Months and Six Months Ended June 30, 2015 and
2016</B></P>



<P STYLE="margin: 0">
<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Three Months Ended June 30,</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Six Months Ended June 30,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 40%; font-size: 10pt; font-weight: bold">REVENUES</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">5,474,575</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">4,567,772</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">10,601,951</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">8,328,380</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">COST OF SALES</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,258,090</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,703,613</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8,475,405</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">6,802,052</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 20.9pt">Gross profit</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,216,485</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">864,159</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,126,546</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,526,328</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">OPERATING EXPENSES</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">683,560</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">529,454</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,077,688</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">916,907</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 20.9pt">Income from operations</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">532,925</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">334,705</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,048,858</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">609,421</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">OTHER INCOME (EXPENSES)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 9.9pt; padding-left: 11pt">Interest income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">66</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">66</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">131</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">130</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 9.9pt; padding-left: 11pt">Other income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">0</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">0</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">0</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">9,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 9.9pt; padding-left: 11pt">Interest expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">0</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">-163</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">-441</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">0</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 20.9pt">TOTAL OTHER EXPENSE</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">66</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-97</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">-310</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">9,130</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Income before income tax expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">532,991</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">334,608</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,048,548</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">618,551</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9.9pt; padding-left: 11pt">Income tax expense</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">43,325</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">40,188</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">65,775</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">48,987</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Other comprehensive income (loss):</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9.9pt; padding-left: 11pt">Foreign currency translation adjustment</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Comprehensive income</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">489,666</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">294,420</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">982,773</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">569,564</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See accompanying notes to unaudited condensed&nbsp;financial
statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font-size: 10pt; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="width: 100%; font-size: 10pt; text-align: center"><B>DC&amp;M PARTNERS, L.L.C.</B></TD></TR>
<TR>
    <TD STYLE="font-size: 10pt; text-align: center"><B>Unaudited Condensed Statements of Cash Flows</B></TD></TR>
<TR>
    <TD STYLE="font-size: 10pt; text-align: center"><B>For the Six months Ended June 2015 &amp; 2016</B></TD></TR>
</TABLE>


<P STYLE="margin: 0">
<P STYLE="margin: 0">&nbsp;&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">Six Months ended June 30,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CASH FLOWS FROM OPERATING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">Net income</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">982,773</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">569,564</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 11pt">Adjustments to reconcile net income to net cash provided by operating activities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-left: 22pt">Depreciation</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">255</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">255</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 11pt">Changes in assets and liabilities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Accounts receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">733,987</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,135,272</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Prepaid expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">26,181</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">18046</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Note receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,232</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Other assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,406</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(8,232</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Accounts payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">208,939</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">706,872</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(2,398</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,434</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 22pt">Income tax payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(79,666</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">13,048</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Long term deferred compensation</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">148,011</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Net cash provided by operating activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,023,490</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">167,079</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CASH FLOWS FROM INVESTING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Capital expenditures</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,616</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,120</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Net cash used in investing activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,616</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(2,120</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">CASH FLOWS FROM FINANCING ACTIVITIES</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD><TD>&nbsp;</TD>
    <TD STYLE="text-align: left">&nbsp;</TD><TD STYLE="text-align: right">&nbsp;</TD><TD STYLE="text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Partner distributions</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(621,319</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(398,284</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 22pt">Net cash used in financing activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(621,319</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(398,284</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">Net decrease in cash and cash equivalents</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,399,554</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(233,325</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt">Cash at beginning of year</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,171,274</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,402,294</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt">Cash at end of year</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">2,570,828</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">1,168,969</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See accompanying notes to unaudited condensed&nbsp;financial
statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 8.8pt; text-align: center"><B>DC&amp;M PARTNERS, L.L.C.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Unaudited Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 42.9pt; text-align: center"><B>June 30, 2016 and 2015</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 42.9pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 243pt 0pt 5.5pt; text-align: justify"><B>NOTE 1 - NATURE OF OPERATIONS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 243pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">DC&amp;M Partners, L.L.C.
(the &ldquo;Company&rdquo;), was formed incorporated in the State of Arizona on January 29, 2007. The Company provides clients
with a wide range of SAP development, consultancy, and management services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 1.5in 0pt 5.5pt; text-align: justify"><B>NOTE 2 - SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 1.5in 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 297pt 0pt 5.5pt; text-align: justify"><B><I>BASIS OF PRESENTATION</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 297pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">The Company has adopted the
Financial Accounting Standards Board (&ldquo;FASB&rdquo;) Codification (&ldquo;Codification&rdquo; or &ldquo;ASC&rdquo;). The Codification
is the single official source of authoritative accounting principles generally accepted in the United States of America (&ldquo;U.S.
GAAP&rdquo;) recognized by the FASB to be applied by nongovernmental entities. All of the Codification&rsquo;s content carries
the same level of authority.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 256.5pt 0pt 5.5pt; text-align: justify"><B><I>USE OF ESTIMATES</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 256.5pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">The preparation of financial
statements in conformity with U.S. GAAP 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. Actual results could differ from those estimates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 301.5pt 0pt 5.5pt; text-align: justify"><B><I>REVENUE RECOGNITION</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 301.5pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">The Company recognizes revenue
in accordance with FASB ASC 985-605-25-79. Revenue is derived from time and expense contracts and is recognized as the services
are performed. Revenue received as reimbursements of billable expenses are reported gross within revenue and the related expenses
are recorded in operating expenses. Unbilled revenue comprises of revenue recognized in relation to efforts incurred on time and
expense contracts not billed at period end where services are performed in accordance with agreed terms. Customer advances represent
payments received in advance of an engagement and are deferred until the service is performed.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 256.5pt 0pt 5.5pt; text-align: justify"><B><I>CASH AND CASH EQUIVALENTS</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 256.5pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">The Company considers all
highly liquid investments with an original maturity of three months or less to be cash equivalents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 315pt 0pt 5.5pt; text-align: justify"><B><I>ACCOUNTS RECEIVABLE</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 315pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">The Company routinely assesses
the financial strength of its customers and debtors and believes that its accounts receivable credit risk exposure is limited.
Accounts receivable are carried at the original invoice amount less an estimate made for doubtful receivables based on a review
of all outstanding amounts on a monthly basis. An allowance is provided for known and anticipated credit losses, as determined
by management in the course of regularly evaluating individual customer receivables. This evaluation takes into consideration
a customer&rsquo;s financial condition and credit history, as well as current economic conditions. Accounts receivable are considered
delinquent when they are over 90 days past due and are written off when deemed uncollectible. Recoveries of accounts receivable
previously written off are recorded in income when received.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 8.8pt; text-align: center"><B>DC&amp;M PARTNERS, L.L.C.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Unaudited Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 42.9pt; text-align: center"><B>June 30, 2016 and 2015</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 42.9pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 279pt 0pt 5.5pt; text-align: justify"><B><I>PROPERTY AND EQUIPMENT</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 279pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">Property and equipment are
recorded at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of
the assets, which range from 3 to 7 years.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">Expenditures for maintenance
and repairs are charged to income as incurred. Additions and betterments are capitalized. The cost of properties sold or otherwise
disposed of, and the accumulated depreciation thereon, is eliminated from the property and reserve accounts, and gains and losses
are reflected in the consolidated statements of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 5.5pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 243pt 0pt 7.7pt; text-align: justify"><B>NOTE 3 - ACCOUNTS RECEIVABLE</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 243pt 0pt 7.7pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 40.5pt 0pt 7.7pt; text-align: justify">Accounts receivable as of
June 30, 2016 and 2015 are summarized as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 40.5pt 0pt 7.7pt; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">Amounts due for services rendered and billed:</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 24.2pt">Outstanding less than 90 days</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,077,079</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,921,182</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 24.2pt">Outstanding more than 90 days</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">129,087</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(175,745</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,206,166</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,745,437</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 24.2pt">Less: allowance for doubtful accounts</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-left: 2.2pt">Amounts due for services rendered and billed, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,206,166</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,745,437</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 2.2pt">Amounts due for services rendered not billed:</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; padding-left: 46.2pt">Accounts receivable, net</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,206,166</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,745,437</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 8.8pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 8.8pt; text-align: center"></P>

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    <DIV STYLE="page-break-before: always; margin-top: 6pt; margin-bottom: 6pt"><P STYLE="margin: 0pt; text-align: right; font-size: 8pt"></P></DIV>
    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 8.8pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 8.8pt; text-align: center"><B>DC&amp;M PARTNERS, L.L.C.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 8.8pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Unaudited Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 42.9pt; text-align: center"><B>June 30, 2016 and 2015</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 42.9pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 5.5pt"><B>NOTE 4 - PROPERTY AND EQUIPMENT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 5.5pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 5.5pt">Property and equipment consists of the following at
June 30,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 5.5pt">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left">Office equipment</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">57,446</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">54,368</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Fixed assets, gross</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">57,446</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">54,368</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Less: accumulated depreciation</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(53,305</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(52,503</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt">Fixed assets, net</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,141</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,865</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Depreciation expense for the six-month
periods ended June30, 2016 and 2015 were $255, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 238.5pt 0pt 0; text-align: justify"><B>NOTE 5 - INCOME TAXES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 238.5pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The Company accounts for income taxes under the provisions of
the FASB ASC 740,&nbsp;<I>Income Taxes</I>.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company elected to be taxed as a partnership
for income tax purposes effective June 3, 2001. Accordingly, the members are responsible for income taxes and no provision for
income taxes is included in these financial statements for the Company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company&rsquo;s policy is to distribute
dividends to provide funds for members to pay income taxes on income reported by the Company. Periodically, additional distributions
are paid to reduce equity in excess of management&rsquo;s evaluation of the amount required for working capital. Management believes
the payment of additional distributions will not negatively impact profitability or impair the operating needs of the Company.
Equity distributions during the period ended June 30, 2015 and 2016 were $1,237,468 and $2,514,560, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company accounts for the effect of
any uncertain tax positions based on a more likely than not threshold to the recognition of the tax positions being sustained based
on the technical merits of the position under scrutiny by the applicable taxing authority. If a tax position or positions are deemed
to result in uncertainties of those positions, the unrecognized tax benefit is estimated based on a cumulative probability assessment
that aggregates the estimated tax liability for all uncertain tax positions. Interest and penalties assessed, if any, are accrued
as income tax expense.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 8.8pt; text-align: center"><B>DC&amp;M PARTNERS, L.L.C.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Unaudited Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 42.9pt; text-align: center"><B>June 30, 2016 and 2015</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 42.9pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">The Company has evaluated its
tax positions and determined no uncertainty requires recognition. The Company files income tax returns in the U.S. federal jurisdiction,
and various state jurisdictions, as well as the required foreign countries. The Company is generally no longer subject to U.S.
federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2011. All dues were paid off
as of the report date.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify"><B>NOTE 6 - EMPLOYEE BENEFIT
PLAN</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify"><B>DEFERRED COMPENSATION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">The Company reviews compensation
for members on an annual basis and accrues deferred compensation for any excess of amounts owed versus amounts paid to members.
As of June 30, 2016 and 2015, deferred compensation was $597,481 and $449,469, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0"><B>NOTE 7 - RECENT ACCOUNTING PRONOUNCEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">In August 2014, the FASB issued
amended guidance related to disclosure of uncertainties about an entity&rsquo;s ability to continue as a going concern. The new
guidance requires management to evaluate whether there is substantial doubt about the entity&rsquo;s ability to continue as a going
concern and, as necessary, to provide related footnote disclosures. The guidance has an effective date of December 31, 2016. The
Company believes that the adoption of this new standard will not have a material impact on its financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">In May 2014, the FASB issued
Accounting Standard Update, or ASU, 2014-09-Revenue from Contracts with Customers, which provides a single, comprehensive revenue
recognition model for all contracts with customers. The core principal of this ASU is that an entity should recognize revenue when
it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to
be entitled in exchange for those goods or services. This ASU also requires additional disclosure about the nature, amount, timing
and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments
and assets recognized from costs incurred to obtain or fulfill a contract. This ASU is effective for annual periods, and interim
periods within those annual periods, beginning after December 15, 2016. Early adoption is not permitted. The Company is currently
evaluating the impact this ASU will have on its financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">In January 2015, the FASB issued
ASU 2015-01-Income Statement-Extraordinary and Unusual Items, which seeks to simplify income statement presentation by eliminating
the concept of Extraordinary Items. This ASU eliminates from U.S. GAAP the concept of extraordinary items. Subtopic 225-20, Income
Statement&mdash;Extraordinary and Unusual Items, required that an entity separately classify, present, and disclose extraordinary
events and transactions. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years,
beginning after December 15, 2015. A reporting entity may apply the amendments prospectively. A reporting entity also may apply
the amendments retrospectively to all prior periods presented in the financial statements. Early adoption is permitted provided
that the guidance is applied from the beginning of the fiscal year of adoption.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 8.8pt; text-align: center"><B>DC&amp;M PARTNERS, L.L.C.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Unaudited Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 42.9pt; text-align: center"><B>June 30, 2016 and 2015</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 42.9pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">In November 20, 2015, the FASB
issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes. The ASU is part of the Board&rsquo;s simplification initiative
aimed at reducing complexity in accounting standards. Current U.S. GAAP requires the deferred taxes for each jurisdiction (or tax-paying
component of a jurisdiction) to be presented as a net current asset or liability and net noncurrent asset or liability. This requires
a jurisdiction-by-jurisdiction analysis based on the classification of the assets and liabilities to which the underlying temporary
differences relate, or, in the case of loss or credit carryforwards, based on the period in which the attribute is expected to
be realized. Any valuation allowance is then required to be allocated on a pro rata basis, by jurisdiction, between current and
noncurrent deferred tax assets. To simplify presentation, the new guidance requires that all deferred tax assets and liabilities,
along with any related valuation allowance, be classified as noncurrent on the balance sheet. As a result, each jurisdiction will
now only have one net noncurrent deferred tax asset or liability. Importantly, the guidance does not change the existing requirement
that only permits offsetting within a jurisdiction &ndash; that is, companies are still prohibited from offsetting deferred tax
liabilities from one jurisdiction against deferred tax assets of another jurisdiction.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 3.25in 0pt 0; text-align: justify"><B>NOTE 8 - OPERATING LEASES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 3.25in 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">The Company leases office space
in Chandler, Arizona under net operating lease agreement. Lease expense for leased property has been accounted for under the operating
lease method where ownership of the asset does not transfer to the lessee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">Operating lease expense was $18,046
and $31,700 for the years ended June 30, 2015 and 2016, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify"><B>NOTE 9 - CONCENTRATION OF
CREDIT RISK</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">For the period ended June 30,
2015 and 2016, approximately 80% and 79%, respectively, of the Company&rsquo;s revenue was derived from ten customers. As of June30,
2015 and 2016, approximately 75% and 70%, respectively, of the Company&rsquo;s accounts receivable were due from five customers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify"><B>NOTE 10 - SUBSEQUENT EVENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">The Company has evaluated subsequent
events through October 11, 2016, the date the unaudited financial statements were available to be issued.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">On July 29, 2015, the Company
entered into a membership interest purchase agreement with Ameri Holdings Inc. (&ldquo;AMERI&rdquo;), which is based in Princeton,
New Jersey, for the purchase of all of the outstanding membership interests of the Company for consideration of: (a) a cash payment
in the amount of $3,000,000 at closing, (b) 1,600,000 shares of AMERI common stock, which are to be issued on July 29, 2018 or
upon a change of control of AMERI (whichever occurs earlier), and (c) earn-out payments to be paid, if earned, in 2017 and 2018,
all as more particularly outlined in the purchase agreement.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 4.4pt 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>UNAUDITED PRO FORMA COMBINED FINANCIAL
STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">On July 29, 2016, Ameri Holdings, Inc. (the &lsquo;&lsquo;Company,&rsquo;&rsquo;
&lsquo;&lsquo;we,&rsquo;&rsquo; &lsquo;&lsquo;our&rsquo;&rsquo; or &lsquo;&lsquo;us&rsquo;&rsquo;) completed the acquisition of
DC&amp;M Partners, L.L.C. (&lsquo;&lsquo;DC&amp;M&rsquo;&rsquo;). The accompanying unaudited pro forma condensed consolidated combined
statements of operations for the year ended December 31, 2016 present the combined results of our operations with DC&amp;M as if
the acquisition and the financing for the acquisition had occurred on January 1, 2016. The historical unaudited pro forma condensed
consolidated financial information includes adjustments that are directly attributable to the acquisition, factually supportable
and with respect to the statement of operations are expected to have a continuing effect on our combined results. The unaudited
pro forma condensed consolidated combined financial information does not reflect the costs of any integration activities or benefits
that may result from realization of future cost savings from operating efficiencies, or any revenue, tax, or other synergies that
may result from the acquisition. The unaudited pro forma condensed consolidated combined financial information and related notes
are being provided for illustrative purposes only and are not necessarily indicative of what our financial position or results
of operations actually would have been had we completed the acquisition at the dates indicated nor are they necessarily indicative
of the combined company&rsquo;s future financial position or operating results of the combined company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">The accompanying unaudited pro forma condensed consolidated
combined financial information and related notes should be read in conjunction with our audited consolidated financial statements
for the years ended December 31, 2016 and 2015 and our unaudited condensed consolidated financial statements as of and for the
six months ended June 30, 2016 and 2015 and DC&amp;M audited financial statements as of and for the years ended December 31, 2015
and 2014 and DC&amp;M unaudited consolidated financial statements as of and for the three and six months ended June 30, 2016 and
2015.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">We prepared the unaudited pro forma condensed consolidated combined
financial information pursuant to Regulation S-X Article 11. Accordingly, our cost to acquire DC&amp;M of approximately $15.816
million has been allocated to the assets acquired and liabilities assumed according to their estimated fair values at the date
of acquisition. Any excess of the purchase price over the estimated fair value of the net assets acquired has been recorded as
goodwill. The preliminary estimates of fair values are reflected in the accompanying unaudited pro forma condensed consolidated
combined financial information. The final determination of these fair values will be completed as soon as possible but no later
than one year from the acquisition date. The final valuation will be based on the actual fair values of assets acquired and liabilities
assumed at the acquisition date. Although the final determination may result in asset and liability fair values that are different
than the preliminary estimates of these amounts included herein, it is not expected that those differences will be material to
an understanding of the impact of this transaction to our financial results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="2" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: bottom">
    <TD NOWRAP COLSPAN="6">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Unaudited Proforma Combined
Statement of Operations</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>For the Year Ended December 31, 2016</B></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="width: 35%; border: Black 1pt solid">&nbsp;</TD>
    <TD STYLE="width: 13%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center"><P STYLE="margin-top: 0; margin-bottom: 0"><B>Ameri</B></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0"><B>Holdings</B></P></TD>
    <TD STYLE="width: 13%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center"><P STYLE="margin-top: 0; margin-bottom: 0"><B>DC&amp;M</B></P>
                                                                                <P STYLE="margin-top: 0; margin-bottom: 0"><B>Partners</B></P></TD>
    <TD STYLE="width: 13%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center"><B>Combined Historical</B></TD>
    <TD STYLE="width: 13%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center"><B>Proforma Adjustments</B></TD>
    <TD STYLE="width: 13%; border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: center"><B>Proforma Combined</B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10pt">Revenue</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;28,493,511 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;20,095,857 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;48,589,368 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;48,589,368 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10pt">Cost of Revenue</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;23,322,828 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;16,378,738 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;39,701,566 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;39,701,566 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid"><B>Gross Profit</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;5,170,683</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;3,717,119 </B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;8,887,802</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;-&nbsp;&nbsp;&nbsp;</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;8,887,802</B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid"><B>Operating Expenses:</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10pt">Selling &amp; Marketing</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;50,262 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;6,236 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;56,498 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;56,498 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10pt">General &amp; Administration</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;7,888,805 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;2,287,254 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;10,176,059 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;10,176,059 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10pt">Acquisition related expenses</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;1,585,136 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;-&nbsp;&nbsp;&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;1,585,136 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;1,585,136 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10pt">Depreciation and Amortization</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;1,361,169 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;12 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;1,361,181 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;1,361,181 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid"><B>Operating Expenses</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;10,885,372</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>2,293,502</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;13,178,874</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;-&nbsp;&nbsp;&nbsp;</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;13,178,874</B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid"><B>Operating Income (Loss)</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right"><B>&nbsp;(5,714,689)</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right"><B>&nbsp;1,423,617</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right"><B>&nbsp;(4,291,072)</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right"><B>&nbsp;-&nbsp;&nbsp;&nbsp;</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right"><B>&nbsp;(4,291,072)</B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10pt">Interest expense</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(727,045) </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(24,470) </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(751,515) </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(751,515) </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10pt">Other Income(Expenses)</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;16,604 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(141,303) </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(124,699) </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(124,699) </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10pt">Change due to estimate correction</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(410,817)</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(410,817) </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(410,817) </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid"><B>Total other Income (expenses)</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;(1,121,258)</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;(165,773)</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;(1,287,031)</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;-&nbsp;&nbsp;&nbsp;</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;(1,287,031)</B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid"><B>Net Income (loss) before income taxes</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right"><B>&nbsp;(6,835,947)</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right"><B>&nbsp;1,257,844</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right"><B>(5,578,103)</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right"><B>&nbsp;-&nbsp;&nbsp;&nbsp;</B></TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right"><B>(5,578,103)</B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10pt">Income tax benefit (provision)</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;&nbsp;3,747,846 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;3,747,846 </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;3,747,846 </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid"><B>Net Income (loss)</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;(3,088,101)</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;1,257,844</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;(1,830,257)</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;-&nbsp;&nbsp;&nbsp;</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;(1,830,257)</B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10pt">Non Controlling Interest</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(3,382) </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(3,382) </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(3,382) </TD></TR>
<TR STYLE="background-color: rgb(204,238,255)">
    <TD STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid"><B>Net income (loss) attributable to the Company</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;(3,091,483)</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;1,257,844</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;(1,833,639)</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;-&nbsp;&nbsp;&nbsp;</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; text-align: right"><B>&nbsp;(1,833,639)</B></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid; text-indent: 10pt">Foreign exchange translation adjustment</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">(7,426) </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(7,426) </TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid; text-align: right">&nbsp;(7,426) </TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-left: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD>
    <TD NOWRAP STYLE="border-right: Black 1pt solid">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD NOWRAP STYLE="border-right: Black 1pt solid; border-bottom: Black 1pt solid; border-left: Black 1pt solid"><B>Comprehensive income (loss)</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>&nbsp;(3,098,909)</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>&nbsp;1,257,844</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>&nbsp;(1,841,065)</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>&nbsp;-&nbsp;&nbsp;&nbsp;</B></TD>
    <TD NOWRAP STYLE="border-top: Black 1pt solid; border-right: Black 1pt solid; border-bottom: Black 1pt solid; text-align: right"><B>&nbsp;(1,841,065)</B></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Note 1 &mdash; Basis of presentation</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The unaudited pro forma condensed combined
financial statements are based on Ameri Holdings, Inc. (the &ldquo;Company&rdquo;) and DC&amp;M Partners, L.L.C. (&ldquo;DC&amp;M)
historical consolidated financial statements as adjusted to give effect to the acquisition of DC&amp;M by the Company. The unaudited
pro forma combined statements of operations for the 12 months ended December 31, 2016 give effect to the DC&amp;M acquisition as
if it had occurred on January 1, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Note 2 &mdash; Preliminary purchase
price allocation</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On July 29, 2016, the Company acquired
DC&amp;M for total consideration of approximately $15.816 million. The unaudited pro forma condensed combined financial information
includes various assumptions, including those related to the preliminary purchase price allocation of the assets acquired and liabilities
assumed of DC&amp;M based on management&rsquo;s best estimates of fair value. The final purchase price allocation may vary based
on final appraisals, valuations and analyses of the fair value of the acquired assets and assumed liabilities. Accordingly, the
pro forma adjustments are preliminary and have been made solely for illustrative purposes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The following table shows the preliminary
allocation of the purchase price for DC&amp;M to the acquired identifiable assets, liabilities assumed and pro forma goodwill:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 85%; font-size: 10pt">Total purchase price</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">15,816,000</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Cash and cash equivalents</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,564,108</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Accounts receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,206,166</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Deposit and other expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">22,263</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Other - Customer Lists</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,400,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 9.9pt">Total identifiable assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,192,537</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Accounts payable and accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,743,310</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Taxes Payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Other payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">592,538</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: 9.9pt">Total liabilities assumed</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,335,848</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9.9pt">Net assets acquired</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,856,689</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: 9.9pt">Total pro forma goodwill</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,959,311</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Note 3 &mdash; Pro forma adjustments</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The pro forma adjustments are based on
our preliminary estimates and assumptions that are subject to change. The following adjustments have been reflected in the unaudited
pro forma condensed combined financial information:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Adjustments to the pro forma condensed
combined balance sheet:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">(1) Reflect the investment in a subsidiary
and the payment of the purchase price; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">(2) Reflect the preliminary estimate of
goodwill, which represents the excess of the purchase price over the fair value of DC&amp;M&rsquo;s identifiable assets acquired
and liabilities assumed as shown in Note 2.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>CERTIFIED PUBLIC ACCOUNTANTS REPORT
OF INDEPENDENT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>REGISTERED PUBLIC ACCOUNTING FIRM</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Board of Directors,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We have audited the accompanying consolidated
balance sheets of ATCG Technology Solutions, Inc. and its subsidiary (together, the &quot;Company&quot;) as of December 31, 2016
and 2015 and the related consolidated statements of income, retained earnings and cash flows for the years then ended. These consolidated
financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform
the 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 audits provide
a reasonable basis for our opinion.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">In our opinion, the consolidated financial
statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31,
2016 and 2015 and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles
generally accepted in the United States of America.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">/s/ Ram Associates</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Ram Associates</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Hamilton, NJ</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">May 18,&nbsp;2017</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">3240 EAST STATE STREET EXT. + HAMILTON,
NJ08619 + (609) 631-9552/63 1-9553 + FAX (888) 319-8898</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">PKRAM@RAMASSOCIATES.US</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>ATCG Technology Solutions, Inc. and
Subsidiary</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Consolidated Balance Sheets</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">December 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold">ASSETS</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">CURRENT ASSETS</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt; text-indent: -7.7pt; padding-left: 17.6pt">Cash</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">163,548</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">50,630</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Accounts receivable, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">787,812</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">277,194</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Other Current Assets</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">487,852</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">135,951</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">TOTAL CURRENT ASSETS</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,439,212</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">463,775</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">PROPERTY AND EQUIPMENT, NET</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">27,721</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">16,427</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">INTANGIBLE ASSET</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,027,500</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt; text-indent: -7.7pt; padding-left: 7.7pt">TOTAL ASSETS</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">2,494,433</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">480,202</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">LIABILITIES AND STOCKHOLDERS&rsquo; EQUITY</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-indent: -7.7pt; padding-left: 7.7pt">LIABILITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Accounts payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">$</TD><TD STYLE="font-size: 10pt; text-align: right">351,144</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">406,398</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Other Current Liabilities</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">850,141</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">94,896</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Deferred Tax Liability</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">687</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">TOTAL LIABILITIES</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">1,201,972</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">501,294</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">STOCKHOLDERS EQUITY</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 17.6pt">Common Stock</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,563</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 17.6pt">Preferred Stock</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">17,532</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">12,123</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 17.6pt">Additional Paid in Capital</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,000,561</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,636,033</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 17.6pt">Retained Earnings</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(6,738,135</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(5,679,964</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 17.6pt">Non-Controlling Interest</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,940</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">9,716</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">1,292,461</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(21,092</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt; text-indent: -7.7pt; padding-left: 7.7pt">TOTAL LIABILITIES AND STOCKHOLDERS&rsquo; EQUITY</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">2,494,433</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">480,202</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See accompanying notes to financial statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>ATCG Technology Solutions, Inc. and
Subsidiary</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Consolidated Statements of Income and
Comprehensive Income</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Years Ended December 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center">2016</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: right">2015</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; font-weight: bold; text-indent: -7.7pt; padding-left: 7.7pt">REVENUES</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">5,968,330</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">1,399,305</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">COST OF SALES</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">4,443,335</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,327,562</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -9.9pt; padding-left: 19.8pt">Gross profit</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,524,995</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">71,743</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">OPERATING EXPENSES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">General and administrative expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,589,077</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,865,904</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-indent: -7.7pt; padding-left: 7.7pt">Depreciation</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,386</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">146,157</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">TOTAL OPERATING EXPENSES</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,597,463</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">2,012,061</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Loss from operations</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,072,468</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,940,318</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">OTHER INCOME (EXPENSES)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Interest income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">103</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Other income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">15,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">7</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Gain on sale of asset</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,736</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Interest expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(4,767</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">TOTAL OTHER INCOME</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">12,072</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Loss before income tax expense</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,060,396</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(1,940,311</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Deferred Tax</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(687</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,061,083</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,940,311</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Net income (loss) attributable to non-controlling interest</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,112</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(7,128</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Net loss attributable to ATCG Technology Solutions, Inc. stockholders</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,055,971</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,947,439</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Other comprehensive income (loss):</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Foreign currency translation adjustment</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(2,200</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">838</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Net loss</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(1,058,171</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">(1,946,601</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">See accompanying notes to financial statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><B>ATCG Technology Solutions, Inc. and
Subsidiary</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><B>Consolidated Statement of Stockholders&rsquo;
Equity</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" STYLE="vertical-align: bottom; border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 8pt"><B>Common
    Stock</B></FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="6" STYLE="vertical-align: bottom; border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 8pt"><B>Preferred
    Stock</B></FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 8pt">Shares</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">Par
                                         Value</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">at
        $0.001</FONT></P></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: black 1pt solid; text-align: center"><FONT STYLE="font-size: 8pt">Shares</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">Par
                                         Value</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">at
        $0.001</FONT></P></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">Additional</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">paid-in</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">capital</FONT></P></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">Other</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">Comprehensive</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">income
        (loss)</FONT></P></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">Retained</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">earnings</FONT></P></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: black 1pt solid; vertical-align: bottom"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-size: 8pt">Non-</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-size: 8pt">Controlling</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-size: 8pt">Interests</FONT></P></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">Total</FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="font-size: 8pt">stockholders&rsquo;equity</FONT></P></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="background-color: #CCEEFF">
    <TD STYLE="vertical-align: bottom; padding-left: 7.7pt; text-indent: -5.5pt"><FONT STYLE="font-size: 8pt"><B>Balance at December
    31, 2014</B></FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>1,000,000</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>1,000</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>71,628</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>72</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>2,836,615</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>-</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>(3,733,363</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>)</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: top; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="vertical-align: bottom; border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>(895,676</B></FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt"><B>)</B></FONT></TD></TR>
<TR STYLE="background-color: white">
    <TD STYLE="vertical-align: bottom; padding-left: 7.7pt; text-indent: -5.5pt"><FONT STYLE="font-size: 8pt">Issuance of capital</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">12,051,392</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">12,051</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">2,799,418</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="vertical-align: top"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="vertical-align: bottom; text-align: right"><FONT STYLE="font-size: 8pt">2,811,469</FONT></TD>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="width: 28%; padding-left: 7.7pt; text-indent: -5.5pt"><FONT STYLE="font-size: 8pt">Net Loss</FONT></TD>
    <TD STYLE="width: 2%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">-</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">838</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">(1,947,439</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">)</FONT></TD>
    <TD STYLE="width: 2%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">9,716</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 2%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="width: 4%; text-align: right"><FONT STYLE="font-size: 8pt">(1,936,885</FONT></TD>
    <TD STYLE="width: 1%"><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 7.7pt; text-indent: -5.5pt"><FONT STYLE="font-size: 8pt"><B>Balance at December 31, 2015</B></FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>1,000,000</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>1,000</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>12,123,020</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>12,123</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>5,636,033</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>838</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>(5,680,802</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>)</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>9,716</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>(21,092</B></FONT></TD>
    <TD><FONT STYLE="font-size: 8pt"><B>)</B></FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 7.7pt; text-indent: -5.5pt"><FONT STYLE="font-size: 8pt">Issuance of Equity Capital for acquisition</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">2,562,500</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">2,563</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">414,937</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">417,500</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 7.7pt; text-indent: -5.5pt"><FONT STYLE="font-size: 8pt">Issuance of Preference Capital for acquisition</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">1,500,282</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">$</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">1,500</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">348,501</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">350,001</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 7.7pt; text-indent: -5.5pt"><FONT STYLE="font-size: 8pt">Issuance of Equity</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">5,000,000</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">5,000</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">916,467</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">921,467</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 7.7pt; text-indent: -5.5pt"><FONT STYLE="font-size: 8pt">Issuance for Preference</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,908,533</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">3,909</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">684,623</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">688,531</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 7.7pt; text-indent: -5.5pt"><FONT STYLE="font-size: 8pt">Non-Controlling Interests</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(5,776</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">)</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(5,776</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: white">
    <TD STYLE="padding-left: 7.7pt; text-indent: -5.5pt"><FONT STYLE="font-size: 8pt">Accumulated other comprehensive income (loss)</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(2,200</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">)</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(1,055,971</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">)</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="text-align: right"><FONT STYLE="font-size: 8pt">(1,058,170</FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">)</FONT></TD></TR>
<TR STYLE="vertical-align: bottom; background-color: #CCEEFF">
    <TD STYLE="padding-left: 7.7pt; text-indent: -5.5pt"><FONT STYLE="font-size: 8pt"><B>Balance at December 31, 2016</B></FONT></TD>
    <TD><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>8,562,500</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>8,563</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>17,531,835</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>17,532</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>8,000,561</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>(1,362</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>)</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>(6,736,773</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>)</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>3,940</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt">&nbsp;</FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid"><FONT STYLE="font-size: 8pt"><B>$</B></FONT></TD>
    <TD STYLE="border-bottom: black 1pt solid; text-align: right"><FONT STYLE="font-size: 8pt"><B>1,292,461</B></FONT></TD>
    <TD>&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>ATCG Technology Solutions, Inc. and
Subsidiary</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Consolidated Statements of Cash Flows</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="7" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">Year Ended December 31,</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">CASH FLOWS FROM OPERATING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Net loss</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">(1,058,171</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">)</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">(1,946,601</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Adjustments to reconcile net loss to net cash used in operating activities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-indent: -7.7pt; padding-left: 7.7pt">Depreciation</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,386</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">146,157</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 17.6pt">Deferred Tax</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">687</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 17.6pt">FCTR Adjustment</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,200</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">838</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 17.6pt">Gain on sale of Asset</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,736</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Changes in assets and liabilities:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 27.5pt">Accounts receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(510,618</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(138,925</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Other current assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(351,901</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(117,055</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Current Liabilities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">700,677</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">342,380</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Net cash used in operating activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1,210,476</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(1,713,206</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">CASH FLOWS FROM INVESTING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Capital expenditures</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(271,494</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(4,635</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Net cash used in investing activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(271,494</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(4,635</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">CASH FLOWS FROM FINANCING ACTIVITIES</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Capital Infusion</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,600,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,400,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Non-controlling interest</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(5,112</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">7,128</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Net cash provided by financing activities</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,594,888</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,407,128</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Net decrease in cash and cash equivalents</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">112,918</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: right">(310,713</TD><TD STYLE="font-size: 10pt; font-weight: bold; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Cash at beginning of year</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">50,630</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: right">361,343</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt; text-indent: -7.7pt; padding-left: 7.7pt">Cash at end of year</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">163,548</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: right">50,630</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; font-weight: bold; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See accompanying notes to financial statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>ATCG Technology Solutions, Inc. and
Subsidiary</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31, 2016 and 2015</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 1 - NATURE OF OPERATIONS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">ATCG Technology Solutions, Inc. (the &quot;Company&quot;)
was formed in the State of Delaware on December 23, 2011. The Company provides clients with a wide range of SAP development, consultancy
and management services.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>FOREIGN OPERATIONS AND FOREIGN CURRENCY</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The operations of the Company&rsquo;s foreign
subsidiary, Ameritas Technologies India Private Limited, a company formed and operating under the laws of India (the &ldquo;Subsidiary&rdquo;),
are subject to risks inherent in operating under different legal systems and various political and economic environments. Among
the risks are changes in existing tax laws, possible limitations on foreign investment and income repatriation, government price
or foreign exchange controls and restrictions on foreign exchange. Cash held in foreign based bank accounts as of December 31,
2016 was approximately $23,428.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Subsidiary transacts business in its
local currency. The financial statements reflect the translation of the functional currency statements to U.S. Dollars. Financial
statements use end of period exchange rates for assets and liabilities, weighted average exchange rates for revenue and expenses.
The resulting foreign currency translation adjustment is recorded in accumulated other comprehensive income (loss) as a component
of equity.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>BASIS OF PRESENTATION</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has adopted the Financial Accounting
Standards Board (&quot;FASB&quot;) Codification (&quot;Codification&quot; or &quot;ASC&quot;). The Codification is the single official
source of authoritative accounting principles generally accepted in the United States of America (&quot;U.S. GAAP&quot;) recognized
by the FASB to be applied by nongovernmental entities. All of the Codification's content carries the same level of authority.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>USE OF ESTIMATES</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The preparation of financial statements
in conformity with U.S. GAAP 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. Actual results could differ from those estimates.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>REVENUE RECOGNITION</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company recognizes revenue in accordance
with FASB ASC 985-605-25-79. Revenue is derived from time and expense contracts and is recognized as the services are performed.
Revenue received as reimbursements of billable expenses are reported gross within revenue and the related expenses are recorded
in operating expenses. Unbilled revenue comprises of revenue recognized in relation to efforts incurred on time and expense contracts
not billed at period end where services are performed in accordance with agreed terms. Customer advances represent payments received
in advance of an engagement and are deferred until the service is performed.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>CASH AND CASH EQUIVALENTS</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company considers all highly liquid
investments with an original maturity of three months or less to be cash equivalents.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>ATCG Technology Solutions, Inc. and
Subsidiary</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31, 2016 and 2015</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>ACCOUNTS RECEIVABLE</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company routinely assesses the financial
strength of its customers and debtors and believes that its accounts receivable credit risk exposure is limited. Accounts receivable
are carried at the original invoice amount less an estimate made for doubtful receivables based on a review of all outstanding
amounts on a monthly basis. An allowance is provided for known and anticipated credit losses, as determined by management in the
course of regularly evaluating individual customer receivables. This evaluation takes into consideration a customer's financial
condition and credit history, as well as current economic conditions. Accounts receivable are considered delinquent when they are
over 90 days past due and are written off when deemed uncollectible. Recoveries of accounts receivable previously written off are
recorded in income when received.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>PROPERTY AND EQUIPMENT</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Property and equipment are recorded at
cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the assets,
which range from 3 to 7 years.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Expenditures for maintenance and repairs
are charged to income as incurred. Additions and betterments are capitalized. The cost of properties sold or otherwise disposed
of, and the accumulated depreciation thereon, is eliminated from the property and reserve accounts, and gains and losses are reflected
in the consolidated statements of operations.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B><I>INCOME TAXES</I></B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company accounts for the effect of
any uncertain tax positions based on a more likely than not threshold to the recognition of the tax positions being sustained based
on the technical merits of the position under scrutiny by the applicable taxing authority. If a tax position or positions are deemed
to result in uncertainties of those positions, the unrecognized tax benefit is estimated based on a cumulative probability assessment
that aggregates the estimated tax liability for all uncertain tax positions. Interest and penalties assessed, if any, are accrued
as income tax expense.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has evaluated its tax positions
and determined no uncertainty requires recognition. The Company files income tax returns in the U.S. federal jurisdiction, and
various state jurisdictions, as well as the required foreign countries. The Company is generally no longer subject to U.S. federal,
state and local, or non-U.S. income tax examinations by tax authorities for years before 2011.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>ATCG Technology Solutions, Inc. and
Subsidiary</B>&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31, 2016 and 2015</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 3 - ACCOUNTS RECEIVABLE</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Accounts receivable as of December 31,
2016 and 2015 are summarized as follows:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">Amounts due for services rendered and billed:</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Outstanding less than 90 days</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">787,812</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">277,194</TD><TD STYLE="width: 1%; border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 17.6pt">Outstanding more than 90 days</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">787,812</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">277,194</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Less: allowance for doubtful accounts</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Amounts due for services rendered and billed, net</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">787,812</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">277,194</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Amounts due for services rendered not billed:</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Accounts receivable, net</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">787,812</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">277,194</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>NOTE 4 - PROPERTY AND EQUIPMENT</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Property and equipment consists of the following at December
31,</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2016</TD><TD STYLE="font-size: 10pt; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2015</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font-size: 10pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 70%; font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Office equipment</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">148,172</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">129,283</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Leasehold Improvements</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">163,290</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">163,290</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Fixed assets, gross</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">311,462</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">286,047</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Less: accumulated depreciation</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(283,741</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">(269,620</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Fixed assets, net</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">27,721</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">16,427</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Depreciation expense for the years ended
December 31, 2016 and 2015 were $8,386 and $146,157, respectively. The depreciation expense for year ended December 31, 2015 includes
the write off of the balance of leasehold improvements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>ATCG Technology Solutions, Inc. and
Subsidiary</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31, 2016 and 2015</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 5 - INCOME TAXES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company accounts for income taxes under
the provisions of the FASB ASC 740, <I>Income Taxes</I>. Although the Company's management believes that their tax estimates are
reasonable, there is no assurance that the final determination of tax liability will not be different from what is reflected in
the Company's income tax provisions and accruals.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>NOTE 6 - RECENT ACCOUNTING PRONOUNCEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On May 28, 2014, the FASB issued Accounting
Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606), with an effective date for annual reporting periods
beginning after December 15, 2016, including interim periods within that reporting period, for public business entities, certain
not-for-profit entities, and certain employee benefit plans. The effective date for all other entities was for annual reporting
periods beginning after December 15, 2017, and interim periods within annual periods beginning after December 15, 2018. The amendments
in this Update defer the effective date of Update 2014-09. Public business entities, certain not-for-profit entities, and certain
employee benefit plans should apply the guidance in Update 2014-09 to annual reporting periods beginning after December 15, 2017,
including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting
periods beginning after December 15, 2016, including interim reporting periods within that reporting period. All other entities
should apply the guidance in Update 2014-09 to annual reporting periods beginning after December 15, 2018, and interim reporting
periods within annual reporting periods beginning after December 15, 2019. Earlier application is permitted only as of an annual
reporting period beginning after December 15, 2016, including interim reporting periods within that reporting period, or an annual
reporting period beginning after December 15, 2016, and interim reporting periods within annual reporting periods beginning one
year after the annual reporting period in which an entity first applies the guidance in Update 2014-09. The Company does not believe
the effect of implementing the above statement will have a material impact on its financial statements.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>ATCG Technology Solutions, Inc. and
Subsidiary</B>&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Notes to Consolidated Financial Statements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>December 31, 2016 and 2015</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 7 - OPERATING LEASES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company leases its principal office
space in Folsom, California and Noida in India under net operating lease agreements. Lease expense for leased property has been
accounted for under the operating lease method where ownership of the asset does not transfer to the lessee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Operating lease expense was $95,517 and
$249,678 for the years ended December 31, 2016 and 2015, respectively.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 8 - CONCENTRATION OF CREDIT RISK</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">For the years ended December 31, 2016 and
2015, approximately 87% and 64%, respectively, of the Company's revenue was derived from four and two customers, respectively.
As of December 31, 2016 and 2015, approximately 86% and 95%, respectively, of the Company's accounts receivable were due from five
customers.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>NOTE 9 - SUBSEQUENT EVENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The Company has evaluated subsequent events
through May 18, 2017, the date the financial statements were available to be issued.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On March 10, 2017, the Company entered
into a purchase agreement with Ameri Holdings Inc (&ldquo;Ameri&rdquo;) which is based in Princeton, New Jersey, for the purchase
of all of the outstanding shares of the Company. The aggregate purchase price for the acquisition of the Company was $8,784,533,
consisting of:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font-size: 10pt; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(a)</TD><TD>576,923 shares of our common stock;</TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font-size: 10pt; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(b)</TD><TD STYLE="text-align: justify">Unsecured promissory notes for the aggregate amount
of $3,750,000 (which notes bear interest at a rate of 6% per annum with a payment schedule of 50% on December 31, 2017 and 50%
on June 30, 2018);</TD>
</TR></TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font-size: 10pt; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(c)</TD><TD STYLE="text-align: justify">Earn-out payments in shares of our common stock (up
to an aggregate value of $1,200,000 worth of shares) to be paid, if earned, in each of 2018 and 2019; and</TD>
</TR></TABLE>
<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font-size: 10pt; margin-top: 0; margin-bottom: 0pt; width: 100%"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in; text-align: left">(d)</TD><TD STYLE="text-align: justify">An additional cash payment of $55,687 for cash that
was left in ATCG at closing.</TD>
</TR></TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The total purchase price of $8,784,533
was allocated to intangibles of $3.75 million, taking into consideration projected revenue from the acquired list of ATCG customers
over a period of three years, and goodwill. The excess of total purchase price over the intangibles allocation has been allocated
to goodwill.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>UNAUDITED PRO FORMA COMBINED FINANCIAL
STATEMENTS</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On March 10, 2017, Ameri Holdings, Inc.
(the ''Company,'' ''we,'' ''our'' or ''us'') completed the acquisition of ATCG Technology Solutions, Inc. (&ldquo;ATCG&rdquo;).
The accompanying unaudited pro forma condensed consolidated combined statements of operations for the fiscal year ended December
31, 2016 present the combined results of our operations with ATCG as if the acquisition and the financing for the acquisition had
occurred on January 1, 2016. The historical unaudited pro forma condensed consolidated financial information includes adjustments
that are directly attributable to the acquisition, factually supportable and with respect to the statement of operations are expected
to have a continuing effect on our combined results. The unaudited pro forma condensed consolidated combined financial information
does not reflect the costs of any integration activities or benefits that may result from realization of future cost savings from
operating efficiencies, or any revenue, tax, or other synergies that may result from the acquisition. The unaudited pro forma condensed
consolidated combined financial information and related notes are being provided for illustrative purposes only and are not necessarily
indicative of what our financial position or results of operations actually would have been had we completed the acquisition at
the dates indicated nor are they necessarily indicative of the combined company's future financial position or operating results
of the combined company.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The accompanying unaudited pro forma condensed
consolidated combined financial information and related notes should be read in conjunction with our consolidated financial statements
for year ending December 31, 2016 and ATCG audited financial statements as of and for the years ended December 31, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">We prepared the unaudited pro forma condensed
consolidated combined financial information pursuant to Regulation S-X Article 11. Accordingly, our cost to acquire ATCG of approximately
$8.75 million has been allocated to the assets acquired and liabilities assumed according to their estimated fair values at the
date of acquisition. Any excess of the purchase price over the estimated fair value of the net assets acquired has been recorded
as goodwill. The preliminary estimates of fair values are reflected in the accompanying unaudited pro forma condensed consolidated
combined financial information. The final determination of these fair values will be completed as soon as possible but no later
than one year from the acquisition date. The final valuation will be based on the actual fair values of assets acquired and liabilities
assumed at the acquisition date. Although the final determination may result in asset and liability fair values that are different
than the preliminary estimates of these amounts included herein, it is not expected that those differences will be material to
an understanding of the impact of this transaction to our financial results.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>AMERI HOLDINGS, INC.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>Unaudited Pro Forma Combined Statement
of Operations</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>For the year ended December 31, 2016</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Ameri <BR>Holdings, <BR>Inc.</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">ATCG <BR>Technology <BR>Solutions <BR>Inc.</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Combined <BR>Historical</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: center; border-bottom: Black 1pt solid">Pro Forma <BR>Adjustments</TD><TD STYLE="font: 10pt Times New Roman, Times, Serif; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="3" STYLE="font: 10pt Times New Roman, Times, Serif; text-align: right; border-bottom: Black 1pt solid">Pro Forma&nbsp; <BR>Combined</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 35%; font-size: 10pt; font-weight: bold; text-indent: -7.7pt; padding-left: 7.7pt">Revenue</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">36,145,589</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">5,968,330</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">42,113,919</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="width: 9%; font-size: 10pt; text-align: right">42,113,919</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-indent: -7.7pt; padding-left: 7.7pt">Cost of revenue</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">29,608,932</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">4,443,335</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">34,052,267</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right"></TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">34,052,267</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Gross profit</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Operating expenses:</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Selling and marketing expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">417,249</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">48,258</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">465,507</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">465,507</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">General and administration expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">8,552,966</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,540,820</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,093,786</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,093,786</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Acquisition related expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,585,136</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,585,136</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,585,136</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 7.7pt">Depreciation and Amortization</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,361,169</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">8,386</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,369,555</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">1,369,555</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">11,916,520</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">2,598,150</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14,514,670</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">14,514,670</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Income before other income / (expenses)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(5,379,863</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,072,469</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(6,452,332</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(6,452,332</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Net Interest expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(751,704</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(4,664</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(755,738</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(755,738</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Other income (expense)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">16,604</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">15,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">31,604</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">31,604</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Changes due to estimate correction</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(410,817</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(410,817</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(410,817</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Loss on sale of fixed assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,736</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,736</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,736</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Net income before income tax</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(6,525,150</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,060,397</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(7,585,547</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(7,585,547</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Provision for income taxes</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,747,846</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(687</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,747,159</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,747,159</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Net Income (loss)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(2,777,304</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(1,061,084</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,841,859</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,838,338</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Unrealized foreign currency translation income</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(7,426</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(2,200</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(9,626</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(9,626</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Non-controlling Interest</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">(3,382</TD><TD STYLE="font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">5,112</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,730</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,730</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; font-weight: bold; text-align: left; padding-bottom: 2.5pt; text-indent: -7.7pt; padding-left: 7.7pt">Net and comprehensive income for the period</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(2,788,112</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(1,058,172</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(3,846,284</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right">(3,846,284</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">)</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">See notes attached to the proforma financial
statements</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"></P>

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    <!-- Field: /Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Note 1 &mdash; Basis of presentation</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The unaudited pro forma condensed combined
financial statements are based on Ameri Holdings, Inc. (the &quot;Company&quot;) and ATCG Technology Solutions Inc. (&quot;ATCG&rdquo;)
historical consolidated financial statements as adjusted to give effect to the acquisition of ATCG by the Company. The unaudited
pro forma combined statements of operations for the year ended December 31, 2016 give effect to the ATCG acquisition as if it had
occurred on January 1, 2016.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"><B>Note 2 &mdash; Preliminary purchase
price allocation</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">On March 10, 2017, the Company acquired
ATCG for total consideration of approximately $8.75 million. The unaudited pro forma condensed combined financial information includes
various assumptions, including those related to the preliminary purchase price allocation of the assets acquired and liabilities
assumed of ATCG based on management's best estimates of fair value. The final purchase price allocation may vary based on final
appraisals, valuations and analyses of the fair value of the acquired assets and assumed liabilities. Accordingly, the pro forma
adjustments are preliminary and have been made solely for illustrative purposes.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The following table shows the preliminary
allocation of the purchase price for ATCG to the acquired identifiable assets, liabilities assumed and pro forma goodwill:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 85%; font-size: 10pt; text-indent: -7.7pt; padding-left: 7.7pt">Total purchase price</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right">8,784,533</TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Cash and cash equivalents</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">163,548</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Accounts receivable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">787,812</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Deposit and other expense</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">487,852</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Tangible Assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">27,752</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Intangible Asset</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,027,500</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Other - Customer Lists</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">3,750,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 17.6pt">Total identifiable assets</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">6,244,464</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Accounts payable and accrued expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,205,943</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Taxes Payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 7.7pt">Other payable</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&mdash;&nbsp;&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; text-indent: -7.7pt; padding-left: 17.6pt">Total liabilities assumed</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">1,205,943</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 17.6pt">Net assets acquired</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">5,038,251</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt">&nbsp;</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left; padding-bottom: 1pt; text-indent: -7.7pt; padding-left: 17.6pt">Total pro forma goodwill</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">3,746,012</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Note 3 &mdash; Pro forma adjustments</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">The pro forma adjustments are based on
our preliminary estimates and assumptions that are subject to change. The following adjustments have been reflected in the unaudited
pro forma condensed combined financial information:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">Adjustments to the pro forma condensed
combined balance sheet:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">(1) Reflect the investment in a subsidiary
and the payment of the purchase price; and</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">(2) Reflect the preliminary estimate of
goodwill, which represents the excess of the purchase price over the fair value of ATCG identifiable assets acquired and liabilities
assumed as shown in Note 2.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-transform: uppercase; text-align: center"><FONT STYLE="font-size: 10pt">________________
Shares</FONT></P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-transform: uppercase; text-align: center"><FONT STYLE="font-size: 10pt">&nbsp;</FONT></P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-transform: uppercase; text-align: center"><FONT STYLE="font-size: 10pt"></FONT><BR>
<FONT STYLE="font-size: 10pt">&nbsp;&nbsp;</FONT><BR>
<IMG SRC="image_002.jpg" ALT="">&nbsp;&nbsp;&nbsp;<BR>
&nbsp;&nbsp;<BR>
&nbsp;&nbsp;<BR>
&nbsp;&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">Common
Stock<BR>
&nbsp;&nbsp;<BR>
&nbsp;&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">PROSPECTUS</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-transform: uppercase; text-align: center; text-indent: 0in">&nbsp;&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; font-size: 10pt">
<TR>
    <TD STYLE="width: 100%; text-align: center"></TD></TR>
<TR>
    <TD STYLE="vertical-align: top; text-align: center"><FONT STYLE="font-size: 18pt"><B>Ladenburg Thalmann &amp; Co. Inc.</B></FONT></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><BR></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>______________, 2017</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B></B></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><B></B>&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">PART II - INFORMATION NOT REQUIRED
IN PROSPECTUS</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">Item 13. OTHER EXPENSES OF ISSUANCE AND
DISTRIBUTION.</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The following table
sets forth the costs and expenses payable by the registrant in connection with this offering. All of the amounts shown are estimates
except the Securities and Exchange Commission (the &ldquo;<B>SEC</B>&rdquo;) registration fee.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%">
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="width: 85%; font-size: 10pt; text-align: left">SEC registration fee</TD><TD STYLE="width: 2%; font-size: 10pt">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; text-align: left">$</TD><TD STYLE="width: 11%; font-size: 10pt; text-align: right"></TD><TD STYLE="width: 1%; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">FINRA filing fee</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Nasdaq listing fee and expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">50,000.00</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Printing and EDGAR expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Legal fees and expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Underwriters&rsquo; expense reimbursement</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">100,000</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; text-align: left">Accounting fees and expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; text-align: left">Transfer Agent and Registrar fees and expenses</TD><TD STYLE="font-size: 10pt">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,238,255)">
    <TD STYLE="font-size: 10pt; padding-bottom: 1pt">Miscellaneous</TD><TD STYLE="font-size: 10pt; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: right">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">Total</TD><TD STYLE="font-size: 10pt; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: right"></TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; text-align: left">&nbsp;</TD></TR>
</TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We will bear all costs,
expenses and fees in connection with the registration of these shares, including with regard to compliance with state securities
or &ldquo;blue sky&rdquo; laws. The selling security holder, however, will bear all commissions and discounts, if any, attributable
to its sale of securities.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">Item 14. INDEMNIFICATION OF DIRECTORS
AND OFFICERS</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Our Certificate of
Incorporation provides that, to the fullest extent permitted by the Delaware General Corporation Law, our directors shall not be
personally liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director. Our Bylaws provide
that, to the fullest extent permitted by Delaware law, we will indemnify, and advance expenses to, a director or officer in an
action brought by reason of the fact that the director or officer is or was our director or officer, or is or was serving at our
request as a director or officer of any other entity, against all expenses, liability and loss reasonably incurred or suffered
by such person in connection therewith. We may maintain insurance to protect a director or officer against any expense, liability
or loss, whether or not we would have the power to indemnify such person against such expense, liability or loss under Delaware
law.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The limitation of liability
and indemnification provisions in our Certificate of Incorporation and Bylaws may discourage stockholders from bringing a lawsuit
against directors for breach of their fiduciary duty. These provisions may also have the effect of reducing the likelihood of derivative
litigation against our directors and officers, even though such an action, if successful, might otherwise benefit us and our stockholders.
However, these provisions do not limit or eliminate our rights, or those of any stockholder, to seek non-monetary relief such as
injunction or rescission in the event of a breach of a director&rsquo;s duty of care. The provisions will not alter the liability
of directors under the federal securities laws. In addition, your investment may be adversely affected to the extent that, in a
class action or direct suit, we pay the costs of settlement and damage awards against directors and officers pursuant to these
indemnification provisions. There is currently no pending litigation or proceeding against any of our directors, officers or employees
for which indemnification is sought.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><B>Indemnification Agreements</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">We have entered into
indemnification agreements with each of our directors and executive officers. Each indemnification agreement provides that, subject
to limited exceptions, and among other things, we will indemnify the director or executive officer to the fullest extent permitted
by law for claims arising in his or her capacity as our director or officer.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">Item 15. RECENT SALES OF UNREGISTERED
SECURITIES</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">During the past two
years, we sold the following securities without registration under the Securities Act:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B>Lone Star Value</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">For
the purpose of financing the ongoing business and operations of our company following the Merger, on May 26, 2015 we completed
the Private Placement, issuing the Convertible Note in the principal amount of $5,000,000, together with the Original Warrant,
pursuant to the terms of the Securities Purchase Agreement with LSVI. The Convertible Note was unsecured and was to become due
on May 26, 2017, the second anniversary of the issue date. Prior to maturity, the Convertible Note bore interest at 5% per annum,
with interest being paid semiannually on the first day of each of the first and third calendar quarters. From and after an event
of default and for so long as the event of default was continuing, the Convertible Note was to bear default interest at the rate
of 10% per annum. The Convertible Note could be prepaid by us at any time without penalty.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">The
Convertible Note was convertible into shares of our common stock at a conversion price of $1.80 per share, or an aggregate of 2,777,778
shares of common stock, subject to adjustment under certain circumstances. The Convertible Note ranked senior to all of our other
obligations, except for trade payables in the ordinary course of business, purchase money asset financing and any inventory or
receivables-based credit facility that we may obtain in the future, provided that the amount of the credit facility does not exceed
50% of eligible inventory and 80% of eligible receivables. The Convertible Note also included certain negative covenants including,
without LSVI&rsquo;s approval, restrictions on debt and security interests, mergers and the purchase and sale of assets, dividends
and other restricted payments, and investments.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">The
Original Warrant issued in the Private Placement gave LSVI the right to purchase up to 2,777,777 shares of common stock (equivalent
to 100% warrant coverage in respect of the shares underlying the Convertible Note) at an exercise price equal to $1.80 per share.
The Original Warrant may be exercised on a cashless-exercise basis, meaning that, upon exercise, the holder would make no cash
payment to us, and would receive a number of shares of our common stock having an aggregate value equal to the excess of the then-current
market price of the shares issuable upon exercise of the Original Warrant over the exercise price of the Warrant. The Original
Warrant expires on May 26, 2020.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">On
May 13, 2016, LSVI completed an early partial exercise of its Original Warrant for 1,111,111 shares of our common stock at a price
of $1.80 per share, for total consideration to us of $2,000,000,&nbsp;and LSVI was issued a replacement warrant for the remaining
1,166,666 shares under the Original Warrant on the same terms as the Original Warrant. LSVI also agreed to an amendment of the
Convertible Note to extend the maturity of the Convertible Note for two years in exchange for (i) the right to request that the
Board expand the size of the Board to nine directors from the current eight, with LSVI having the right to designate up to four
of the nine directors, and (ii) the issuance of the Additional Warrant for the purchase of 1,000,000 shares of the Company&rsquo;s
common stock at a price of $6.00 per share, on substantively the same terms as the Original Warrant, except the Additional Warrant
may only be exercised for cash. LSVI&rsquo;s Registration Rights Agreement, dated May 26, 2015, with the Company was also amended
and restated to include the shares of common stock issuable under the Additional Warrant.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in; background-color: white">On December 30,
2016, the Company entered into the Exchange Agreement with LSVI, pursuant to which the Convertible Note was returned to the Company
and cancelled in exchange for 363,611 shares of the Company&rsquo;s Series A Preferred Stock, which is non-convertible and perpetual
preferred stock of the Company. As a result of the exchange transaction, no principal or interest remained outstanding or payable
under the Convertible Note and the Convertible Note was no longer convertible into shares of common stock of the Company. The Company
issued 10,097 shares of Series A Preferred Stock to LSVI in May 2017 as payment of a dividend on the shares of Series A Preferred
Stock held by LSVI as of March 31, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white"><B>2015 and 2016
Issuances</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><FONT STYLE="background-color: white">On
November 20, 2015, we issued 235,295 restricted shares of our common stock to the two former shareholders of Ameri Georgia as part
of the total consideration for the acquisition of Ameri Georgia. The former shareholders and officers of Ameri Georgia made representations
to us regarding their knowledge and experience, ability to bear economic risk and investment purpose with respect to the restricted
shares they received.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">On
April 20, 2016, we entered into a Stock Purchase Agreement with Dhruwa N. Rai, an investor identified by the Company and who subsequently
became a director of the Company, pursuant to which Mr. Rai purchased 500,000 restricted shares of our common stock from us at
a price per share of $6.00 for aggregate consideration to us of $3,000,000. Mr. Rai <FONT STYLE="background-color: white">made
representations to us regarding his knowledge and experience, ability to bear economic risk and investment purpose with respect
to the restricted shares he purchased.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">On
June 23, 2016, we entered into a definitive agreement to purchase Bigtech. The acquisition of Bigtech was effective as of July
1, 2016, and as part of the consideration paid for the acquisition, we delivered to Bigtech&rsquo;s two former shareholders and
officers warrants for the purchase of an aggregate 51,000 restricted shares of our common stock. <FONT STYLE="background-color: white">Pursuant
to the terms of the warrants, the former Bigtech shareholders acknowledged that the warrants represented unregistered securities
that may not be sold or offered except pursuant to an effective registration statement and that any shares issued upon exercise
of the warrants would be restricted and held for each such former shareholder&rsquo;s own account. </FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><FONT STYLE="background-color: white">On
July 22, 2016, we issued 101,250 restricted shares of our common stock to the former sole member and chief executive officer of
Virtuoso as part of the total consideration for the acquisition of Virtuoso .The shares were issued with a value of $6.51 per share.
The former sole member of Virtuoso made representations to us regarding his knowledge and experience, ability to bear economic
risk and investment purpose with respect to the restricted shares he received.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">On
July 29, 2016, we became obligated to issue 1,600,000 restricted shares of our common stock to the three former members and managing
partners of Ameri Arizona as part of the total consideration for the acquisition of Ameri Arizona. The restricted shares are to
be issued on July 29, 2018 or upon a change of control of the Company (whichever occurs earlier). <FONT STYLE="background-color: white">The
former members of </FONT>Ameri Arizona <FONT STYLE="background-color: white">made representations to us regarding their knowledge
and experience, ability to bear economic risk and investment purpose with respect to the restricted shares they received.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><FONT STYLE="background-color: white">On
September 1, 2016, we issued 299,250 restricted shares of common stock to Srinidhi &ldquo;Dev&rdquo; Devanur, our Executive Chairman,
in connection with the completion of our acquisition of Ameri India on July 1, 2016, pursuant to the terms of a Stock Purchase
Agreement dated May 26, 2015. </FONT>Mr. Devanur previously <FONT STYLE="background-color: white">made representations to us regarding
his knowledge and experience, ability to bear economic risk and investment purpose with respect to the restricted shares he acquired.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><B>2017 Issuances</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">On
January 27, 2017, the Company issued 33,333 restricted shares of its common stock its legal counsel, Olshan Frome Wolosky LLP (&quot;Olshan&quot;),
in exchange for the cancellation of a portion of accrued and unpaid legal fees owed by the Company to Olshan. Each of the Olshan
partners who received restricted shares is a sophisticated investor with knowledge and experience of financial and business matters
related to an investment in the Company&rsquo;s securities. In addition, restricted shares bear transfer restrictions and the recipients
acquired such securities for their own respective accounts without a view to resell or distribute them.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">On
March 7, 2017, we completed the sale and issuance of an aggregate of $1,250,000 in 8% Convertible Unsecured Promissory Notes (the
&ldquo;2017 Notes&rdquo;) to four accredited investors, including one of the Company&rsquo;s directors, Dhruwa N. Rai. The 2017
Notes were issued pursuant to Securities Purchase Agreements with each investor, pursuant to which each investor purchased its
2017 Note from the Company. The 2017 Notes will bear interest at 8% per annum until maturity in March 2020, with interest being
paid annually on the first, second and third anniversaries of the issuance of the 2017 Notes beginning in March 2018. From and
after an event of default and for so long as the event of default is continuing, the 2017 Notes will bear default interest at the
rate of 10% per annum. The 2017 Notes can be prepaid by us at any time without penalty.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">The
2017 Notes are convertible into shares of our common stock at a conversion price equal to $_______ (equal to 68% of the price per
share of the common stock sold in this offering). Upon the effectiveness of this registration statement, the holders of the 2017
Notes have the right, at their option, at any time and from time to time to convert, in part or in whole, the outstanding principal
amount and all accrued and unpaid interest under the 2017 Notes into shares of the Company&rsquo;s common stock at the then applicable
conversion price.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">The
2017 Notes rank junior to our secured credit facility with Sterling National Bank. The 2017 Notes also include certain negative
covenants including, without the investors&rsquo; approval, restrictions on dividends and other restricted payments and reclassification
of its stock. <FONT STYLE="background-color: white">The 2017 Notes purchasers made representations to us regarding their knowledge
and experience, ability to bear economic risk and investment purpose with respect to the 2017 Notes they purchased. Pursuant to
the terms of the 2017 Notes purchase agreement, the purchasers acknowledged that the 2017 Notes represented unregistered securities
that may not be sold or offered except pursuant to an effective registration statement and that any shares issued upon conversion
of the 2017 Notes would be restricted and held for each holder&rsquo;s own account.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white"><FONT STYLE="background-color: white">On
March 10, 2017, we issued 576,923 restricted shares of our common stock to the nine former stockholders of Ameri California as
part of the total consideration for the acquisition of Ameri California. The shares were issued with a value of $6.50 per share.&nbsp;The
former shareholders of Ameri California made representations to us regarding their knowledge and experience, ability to bear economic
risk and investment purpose with respect to the restricted shares they received.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">The
foregoing issuances were exempt from registration under Section 4(a)(2) of the Securities Act as sales by an issuer not involving
a public offering. None of the foregoing issuances were registered under the Securities Act, or the securities laws of any state,
and were offered and sold in reliance on the exemption from registration afforded by Section 4(a)(2) and corresponding provisions
of state securities laws, which exempts transactions by an issuer not involving any public offering. In each case, the issuances
were made, without any general solicitation or advertising, to a limited number of sophisticated investors with knowledge and experience
of financial and business matters related to an investment in the Company&rsquo;s securities. In addition, the securities issued
in the foregoing issuances were restricted securities bearing transfer restrictions and the recipients acquired such securities
for their own respective accounts without a view to resell or distribute them. Such securities may not be offered or sold in the
United States absent registration or an applicable exemption from the registration requirements and certificates evidencing such
shares contain a legend stating the same. Accordingly, the foregoing issuances are subject to the private placement exemption from
registration provided by Section 4(a)(2) of the Securities Act.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in; background-color: white">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">Item 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">See the Exhibit Index,
which follows the signature page and which is incorporated by reference herein.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">Item 17. UNDERTAKINGS</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: left">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">The undersigned Registrant
hereby undertakes:</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(1)</TD><TD STYLE="text-align: justify">To file, during any period in which offers or sales are being made, a post-effective amendment
to this registration statement:</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 1in"></TD><TD STYLE="width: 0.5in">(i)</TD><TD STYLE="text-align: justify">To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif"></P>

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<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 1in"></TD><TD STYLE="width: 0.5in">(ii)</TD><TD STYLE="text-align: justify">To reflect in the prospectus any facts or events arising after the effective date of the registration
statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental
change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation
from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum
aggregate offering price set forth in the &ldquo;Calculation of Registration Fee&rdquo; table in the effective registration statement;
and</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 1in"></TD><TD STYLE="width: 0.5in">(iii)</TD><TD STYLE="text-align: justify">To include any material information with respect to the plan of distribution not previously disclosed
in the registration statement or any material change to such information in the registration statement.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(2)</TD><TD STYLE="text-align: justify">That, for the purpose of determining any liability under the Securities Act of 1933, each such
post-effective amendment shall be deemed a new registration statement relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the initial <I>bona fide</I> offering thereof.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(3)</TD><TD STYLE="text-align: justify">To remove from registration by means of a post-effective amendment any of the securities being
registered which remain unsold at the termination of the offering.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0.5in"></TD><TD STYLE="width: 0.5in">(4)</TD><TD STYLE="text-align: justify">That, for purposes of determining liability under the Securities Act of 1933 to any purchaser,
each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration
statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included
in the registration statement as of the date it is first used after effectiveness. <I>Provided, however</I>, that no statement
made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or
deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will,
as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the
registration statement or prospectus that was part of the registration statement or made in any such document immediately prior
to such date of first use.</TD></TR></TABLE>

<P STYLE="margin-top: 0pt; margin-bottom: 0pt; font: 10pt Times New Roman, Times, Serif">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Insofar as indemnification
for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant
will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed
by the final adjudication of such issue.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">SIGNATURES</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Pursuant to the requirements
of the Securities Act of 1933, as amended, the Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-1 and has duly caused this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the city of New York, State of New York, on September 18, 2017.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">Ameri Holdings, Inc.</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">(Registrant)</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom; width: 51%">&nbsp;</TD>
    <TD STYLE="vertical-align: top; width: 8%">By:</TD>
    <TD STYLE="vertical-align: bottom; width: 41%; border-bottom: Black 1pt solid">/s/ Giri Devanur</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: top">Name</TD>
    <TD STYLE="vertical-align: bottom">Giri Devanur</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: top">Title:</TD>
    <TD STYLE="vertical-align: bottom">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Ameri Holdings, Inc.</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">(Principal Executive Officer)</P></TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD>&nbsp;</TD>
    <TD COLSPAN="2">&nbsp;</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: top">By:</TD>
    <TD STYLE="vertical-align: bottom; border-bottom: Black 1pt solid">/s/ Viraj Patel</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: top">Name</TD>
    <TD STYLE="vertical-align: bottom">Viraj Patel</TD></TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: top">Title:</TD>
    <TD STYLE="vertical-align: bottom">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Ameri Holdings, Inc.</P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">(Principal Financial and Accounting Officer)</P></TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in"><FONT STYLE="background-color: white">KNOW
ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below does hereby constitute and appoint jointly and severally,
Giri Devanur and Viraj Patel, or either of them, with full power of substitution and full power to act without the other, his or
her true and lawful attorney-in-fact and agent to act for him or her in his or her name, place and stead, in any and all capacities,
to sign any or all amendments thereto (including without limitation any post-effective amendments hereto), and any registration
statement for the same offering that is to be effective under Rule 462(b) of the Securities Act, and to file each of the same,
with all exhibits thereto, and other documents in connection therewith or herewith, with the Securities and Exchange Commission,
granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act
and thing requisite and necessary to be done in and about the premises in order to effectuate the same as fully, to all intents
and purposes, as they, he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or any of them, may lawfully do or cause to be done by virtue hereof.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">Pursuant to the requirements
of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the
dates indicated below.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify; text-indent: 0.5in">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 30%"><B>Signature</B></TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 33%"><B>Title</B></TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 33%"><B>Date</B></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: Black 1pt solid">/s/ Giri Devanur</TD>
    <TD>&nbsp;</TD>
    <TD>President, Chief Executive Officer</TD>
    <TD>&nbsp;</TD>
    <TD>September 18, 2017</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Giri Devanur</TD>
    <TD>&nbsp;</TD>
    <TD>and Director</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>(Principal Executive Officer)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: Black 1pt solid">/s/ Viraj Patel</TD>
    <TD>&nbsp;</TD>
    <TD>Chief Financial Officer</TD>
    <TD>&nbsp;</TD>
    <TD>September 18, 2017</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Viraj Patel</TD>
    <TD>&nbsp;</TD>
    <TD>(Principal Financial Officer and<BR>
Principal Accounting Officer)</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: Black 1pt solid">/s/ Dimitrios J. Angelis</TD>
    <TD>&nbsp;</TD>
    <TD>Director</TD>
    <TD>&nbsp;</TD>
    <TD>September 18, 2017</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Dimitrios J. Angelis</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: Black 1pt solid">/s/ Venkatraman Balakrishnan</TD>
    <TD>&nbsp;</TD>
    <TD>Director</TD>
    <TD>&nbsp;</TD>
    <TD>September 18, 2017</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Venkatraman Balakrishnan</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: Black 1pt solid">/s/ Srinidhi Devanur</TD>
    <TD>&nbsp;</TD>
    <TD>Director</TD>
    <TD>&nbsp;</TD>
    <TD>September 18, 2017</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Srinidhi Devanur</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: Black 1pt solid">/s/ Jeffrey E. Eberwein</TD>
    <TD>&nbsp;</TD>
    <TD>Director, Chairman</TD>
    <TD>&nbsp;</TD>
    <TD>September 18, 2017</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Jeffrey E. Eberwein</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: Black 1pt solid; width: 30%">/s/ Dr. Arthur M. Langer</TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 33%">Director</TD>
    <TD STYLE="width: 2%">&nbsp;</TD>
    <TD STYLE="width: 33%">September 18, 2017</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Dr. Arthur M. Langer</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: Black 1pt solid">/s/ Robert G. Pearse</TD>
    <TD>&nbsp;</TD>
    <TD>Director</TD>
    <TD>&nbsp;</TD>
    <TD>September 18, 2017</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Robert G. Pearse</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="border-bottom: Black 1pt solid">/s/ Dhruwa N. Rai</TD>
    <TD>&nbsp;</TD>
    <TD>Director</TD>
    <TD>&nbsp;</TD>
    <TD>September 18, 2017</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>Dhruwa N. Rai</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
</TABLE>

<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>

<P STYLE="margin-top: 0; margin-bottom: 0"></P>

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<P STYLE="margin-top: 0; margin-bottom: 0">&nbsp;</P>
<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">EXHIBIT INDEX</P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR>
    <TD STYLE="vertical-align: bottom; width: 14%">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; border-bottom: Black 0.5pt solid"><B>Exhibit</B><BR>
<B>Number</B></P></TD>
    <TD STYLE="vertical-align: bottom; width: 86%">
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; border-bottom: Black 0.5pt solid"><B>Description of
Exhibits</B></P></TD>
    </TR>
<TR>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD>
    <TD STYLE="vertical-align: bottom">&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>1.1++</TD>
    <TD>Form of Underwriting Agreement.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>2.1</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189515001474/ex21to8k10211004_05262015.htm" STYLE="-sec-extract: exhibit">Agreement of Merger and Plan of Reorganization, dated as of May 26, 2015, among Spatializer Audio Laboratories, Inc., Ameri100 Acquisition, Inc. and Ameri &amp; Partners Inc. (filed as Exhibit 2.1 to AMERI Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on May 26, 2015 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>2.2</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189515001521/ex103to8k10211004b_05262015.htm" STYLE="-sec-extract: exhibit">Stock Purchase Agreement by and between Ameri Holdings, Inc. and the shareholders of Ameri Consulting Service Private Limited. (filed as Exhibit 10.3 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>2.3</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000107997415000800/ex2_1.htm" STYLE="-sec-extract: exhibit">Share Purchase Agreement, dated as of November 20, 2015, by and among Ameri Holdings, Inc., Bellsoft, Inc., and all of the shareholders of Bellsoft (filed as Exhibit 2.1 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on November 23, 2015 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>2.4</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189516005236/ex21to8k10211002_07272016.htm" STYLE="-sec-extract: exhibit">Agreement of Merger and Plan of Reorganization, dated as of July 22, 2016, by and among Ameri Holdings, Inc., Virtuoso Acquisition Inc., Ameri100 Virtuoso Inc., Virtuoso, L.L.C. and the sole member of Virtuoso, L.L.C. (filed as Exhibit 2.1 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on July 27, 2016 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>2.5</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189516005270/ex21to8k10211002_08012016.htm" STYLE="-sec-extract: exhibit">Membership Interest Purchase Agreement, dated as of July 29, 2016, by and among Ameri Holdings, Inc., DC&amp;M Partners, L.L.C., all of the members of DC&amp;M Partners, L.L.C., Giri Devanur and Srinidhi &ldquo;Dev&rdquo; Devanur (filed as Exhibit 2.1 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on August 1, 2016 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>2.6</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189517000674/ex21to8k10211002_03132017.htm" STYLE="-sec-extract: exhibit">Share Purchase Agreement, dated as of March 10, 2017, by and among Ameri Holdings, Inc., ATCG Technology Solutions, Inc., all of the stockholders of ATCG Technology Solutions, Inc., and the stockholders&rsquo; representative (filed as Exhibit 2.1 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on March 13, 2017 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>3.1</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189516004989/ex31to8k10211002_06232016.htm" STYLE="-sec-extract: exhibit">Amended and Restated Certificate of Incorporation of Ameri Holdings, Inc. (filed as Exhibit 3.1 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on June 23, 2016 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>3.2</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189517000021/ex31to8k10211002_01042017.htm" STYLE="-sec-extract: exhibit">Certificate of Designation of Rights and Preferences of 9.00% Series A Cumulative Preferred Stock (filed as Exhibit 3.1 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on January 4, 2017 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>3.3</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000119380517000652/e616034_ex3-3.htm" STYLE="-sec-extract: exhibit">Corrected Certificate of Designation of Rights and Preferences of 9.00% Series A Cumulative Preferred Stock (filed as Exhibit 3.3 to Ameri Holdings, Inc.&rsquo;s Registration Statement on Form S-1, Amendment No. 1, filed with the SEC on April 18, 2017 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>3.4</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189516004989/ex32to8k10211002_06232016.htm" STYLE="-sec-extract: exhibit">Amended and Restated Bylaws of Ameri Holdings, Inc. (filed as Exhibit 3.2 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on June 23, 2016 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>4.1</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189515002813/ex41tos810211002_12172015.pdf">Form of Certificate Representing Shares of Common Stock of Registrant (filed as Exhibit 4.1 to Ameri Holdings, Inc.&rsquo;s Registration Statement on Form S-8 filed with the SEC on December 17, 2015 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>4.2</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189515001521/ex41to8k10211004b_05262015.htm" STYLE="-sec-extract: exhibit">Form of Common Stock Purchase Warrant issued by Ameri Holdings, Inc. to Lone Star Value Investors, LP, dated May 26, 2015 (filed as Exhibit 4.1 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).</A></TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 14%">4.3</TD>
    <TD STYLE="width: 86%"><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000107997416001197/ex4_3.htm" STYLE="-sec-extract: exhibit">Common Stock Purchase Warrant, dated May 12, 2016, issued by Ameri Holdings, Inc. to Lone Star Value Investors, LP, dated May 12, 2016 (filed as Exhibit 4.3 to Ameri Holdings, Inc.&rsquo;s Quarterly Report on Form 10-Q filed with the SEC on May 16, 2016 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>4.4</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000107997416001197/ex10_3.htm" STYLE="-sec-extract: exhibit">Amended and Restated Registration Rights Agreement, dated May 12, 2016, by and between Ameri Holdings, Inc. and Lone Star Value Investors, LP (filed as Exhibit 10.3 to Ameri Holdings, Inc.&rsquo;s Quarterly Report on Form 10-Q filed with the SEC on May 16, 2016 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>4.5</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189517000631/ex102to8k10211002_03072017.htm" STYLE="-sec-extract: exhibit">Form of 8% Convertible Unsecured Promissory Note due March 2020 (filed as Exhibit 10.2 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on March 8, 2017 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>4.6</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189517000631/ex103to8k10211002_03072017.htm" STYLE="-sec-extract: exhibit">Form of Registration Rights Agreement for 2017 Notes Investors (filed as Exhibit 10.3 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on March 8, 2017 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>4.7</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189517000674/ex101to8k10211002_03132017.htm" STYLE="-sec-extract: exhibit">Form of 6% Unsecured Promissory Note (filed as Exhibit 10.1 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on March 13, 2017 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>5.1++</TD>
    <TD>Opinion of Olshan Frome Wolosky LLP.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.1</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189515001521/ex101to8k10211004b_05262015.htm" STYLE="-sec-extract: exhibit">Securities Purchase Agreement, dated as of May 26, 2015, by and between Ameri Holdings, Inc. and Lone Star Value Investors, LP. (filed as Exhibit 10.1 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.2</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189515001521/ex103to8k10211004b_05262015.htm" STYLE="-sec-extract: exhibit">Stock Purchase Agreement by and between Ameri Holdings, Inc. and the shareholders of Ameri Consulting Service Private Limited. (filed as Exhibit 10.3 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.3</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189515001521/ex104to8k10211004b_05262015.htm" STYLE="-sec-extract: exhibit">Employment Agreement, dated as of May 26, 2015, between Giri Devanur and Ameri Holdings, Inc. (filed as Exhibit 10.4 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.4</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189515001521/ex105to8k10211004b_05262015.htm" STYLE="-sec-extract: exhibit">Employment Agreement, dated as of May 26, 2015, between Srinidhi &ldquo;Dev&rdquo; Devanur and Ameri Holdings, Inc. (filed as Exhibit 10.5 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.5</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189515001521/ex106to8k10211004b_05262015.htm" STYLE="-sec-extract: exhibit">Form of Indemnification Agreement. (filed as Exhibit 10.6 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.6</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189515001521/ex107to8k10211004b_05262015.htm" STYLE="-sec-extract: exhibit">Form of Option Grant Letter. (filed as Exhibit 10.7 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.7*</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189515001521/ex108to8k10211004b_05262015.htm" STYLE="-sec-extract: exhibit">2015 Equity Incentive Award Plan. (filed as Exhibit 10.8 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.8</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000107997415000809/ex10_1.htm" STYLE="-sec-extract: exhibit">Form of Restricted Stock Unit Agreement (filed as Exhibit 10.1 to Ameri Holdings, Inc.&rsquo;s Quarterly Report on Form 10-Q filed with the SEC on November 23, 2015 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.9</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189516004188/ex101to8k10211001_04212016.htm" STYLE="-sec-extract: exhibit">Securities Purchase Agreement, dated as of April 20, 2016, by and between Ameri Holdings, Inc. and Dhruwa N. Rai (filed as Exhibit 10.1 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on April 21, 2016 and incorporated herein by reference).</A></TD></TR>
</TABLE>

<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="margin: 0"></P>

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<P STYLE="margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="width: 100%; border-collapse: collapse; font-size: 10pt">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 14%">10.10</TD>
    <TD STYLE="width: 86%"><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189516005106/ex101to8k10211002_07072016.htm" STYLE="-sec-extract: exhibit">Loan and Security Agreement, dated as of July 1, 2016, by and among Ameri and Partners Inc, Bellsoft, Inc., Ameri Holdings, Inc., Linear Logics, Corp., Winhire Inc, Giri Devanur, the lenders which become a party to the Loan and Security Agreement, and Sterling National Bank, N.A. (a lender and as agent for the lenders) (filed as Exhibit 10.1 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on July 7, 2016 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.11</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189517000021/ex101to8k10211002_01042017.htm" STYLE="-sec-extract: exhibit">Exchange Agreement, dated as of December 30, 2016, between Ameri Holdings, Inc. and Lone Star Value Investors, LP (filed as Exhibit 10.1 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on January 4, 2017 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.12</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189517000631/ex101to8k10211002_03072017.htm" STYLE="-sec-extract: exhibit">Form of Securities Purchase Agreement for 2017 Notes Investors (filed as Exhibit 10.1 to Ameri Holdings, Inc.&rsquo;s Current Report on Form 8-K filed with the SEC on March 8, 2017 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>10.13</TD>
    <TD><A HREF="http://www.sec.gov/Archives/edgar/data/890821/000092189517001172/ex101to8k10211002_042517.htm" STYLE="-sec-extract: exhibit">Employment Letter, dated April 24, 2016, between Ameri and Partners Inc and Viraj Patel (filed as Exhibit 10.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on April 25, 2017 and incorporated herein by reference).</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>21.1+</TD>
    <TD><A HREF="e616570_ex21-1.htm">List of Subsidiaries.</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>23.1+</TD>
    <TD><A HREF="e616570_ex23-1.htm">Consent of Ram Associates.</A></TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>23.2++</TD>
    <TD>Consent of Olshan Frome Wolosky LLP (included in Exhibit 5.1)</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>24.1+</TD>
    <TD>Power of Attorney.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><SUP>#</SUP>101.INS</TD>
    <TD>XBRL Instance Document.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><SUP>#</SUP>101.SCH</TD>
    <TD>XBRL Taxonomy Extension Schema Document.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><SUP>#</SUP>101.CAL</TD>
    <TD>XBRL Taxonomy Extension Calculation Linkbase Document.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><SUP>#</SUP>101.DEF</TD>
    <TD>XBRL Taxonomy Extension Definition Linkbase Document.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><SUP>#</SUP>101.LAB</TD>
    <TD>XBRL Taxonomy Extension Label Linkbase Document.</TD></TR>
<TR STYLE="vertical-align: top">
    <TD>&nbsp;</TD>
    <TD>&nbsp;</TD></TR>
<TR STYLE="vertical-align: top">
    <TD><SUP>#</SUP>101.PRE</TD>
    <TD>XBRL Taxonomy Extension Presentation Linkbase Document.</TD></TR>
</TABLE>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: justify"># Pursuant to Rule 406T of Regulation S-T,
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{"company-data": {"conformed-name": "AMERI Holdings, Inc.", "cik": "0000890821", "assigned-sic": "3674", "irs-number": "954484725", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-1", "act": "33", "file-number": "333-220499", "film-number": "171088984"}, "business-address": {"street1": "100 CANAL POINTE BLVD., SUITE 108", "city": "PRINCETON", "state": "NJ", "zip": "08540", "phone": "732-243-9250"}, "mail-address": {"street1": "100 CANAL POINTE BLVD., SUITE 108", "city": "PRINCETON", "state": "NJ", "zip": "08540"}, "former-company": {"former-conformed-name": "SPATIALIZER AUDIO LABORATORIES INC", "date-changed": "19950323"}}
As filed with the Securities and Exchange
Commission on September 18, 2017
Registration No. 333-
UNITED STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
AMERI
Holdings, Inc.
(Exact
Name of Registrant as Specified in its Charter)
Delaware
7371
95-4484725
(State or Other Jurisdiction of Incorporation or Organization)
(Primary Standard Industrial Classification Code Number)
(I.R.S. Employer Identification No.)
100 Canal Pointe
                                         Blvd., Suite 108 Princeton, New Jersey 08540
(732) 243-9250
(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant's Principal Executive Offices)
Giri Devanur
President and Chief Executive Officer
100 Canal Pointe Boulevard, Suite 108 Princeton,
                                   New Jersey 08540
(732) 243-9250
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service)
Copies to:
Adam W. Finerman, Esq.
Olshan Frome Wolosky LLP
1325 Avenue of the Americas
New York, New York 10019
(212) 451-2300
Stephen E Older
McGuireWoods LLP
1345 Avenue of the Americas
New York, New York 10105
(212) 548-2122
Approximate date of commencement of
proposed sale to the public:
As soon as practicable after the effective date of this registration statement.
If any of the securities being registered
on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the
following box.
¨
If this Form is filed to register additional
securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement for the same offering.
¨
If this Form is a post-effective amendment
filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same offering.
¨
If this Form is a post-effective amendment
filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same offering.
¨
Indicate by check mark
whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company,
or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller
reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer
¨
Accelerated filer
¨
Non-accelerated filer
¨
Smaller reporting company
x
(Do not check if a smaller reporting company)
Emerging growth
company
x
If an emerging growth company, indicate by check mark if the
registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards
provided pursuant to Section 7(a)(2)(B) of the Securities Act.
¨
CALCULATION OF REGISTRATION FEE
Title of each class of
securities to be registered
Amount to be registered
Proposed
maximum
offering price
per unit
Proposed
maximum
aggregate offering
price
(1)
Amount of
registration fee
Common Stock, par value $0.01 per share
_______ shares
(2)
$____ per share
$10,000,000
$1,159.00
TOTAL
$10,000,000
$1,159.00
__________
(1)
Estimated in accordance with Rule 457 solely for the purpose of calculating the registration fee.
(2)
Including shares of common stock that may be purchased by the underwriters to cover over-allotments.
The Registrant hereby amends this Registration Statement
on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which
specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities
Act, or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission acting pursuant
to said Section 8(a), may determine.
The information
in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed
with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell nor does it seek an offer to
buy these securities in any jurisdiction where the offer or sale is not permitted.
PRELIMINARY PROSPECTUS
SUBJECT TO COMPLETION
DATED SEPTEMBER __, 2017
_________ Shares
Common Stock
Ameri Holdings, Inc.
We are offering an aggregate of _______
shares of our common stock, $0.01 par value per share. We anticipate a public offering price of between $___ and $___ per share
of our common stock. Our common stock is presently quoted on the OTCQB under the symbol "AMRH". We have applied to
have our common stock listed on The NASDAQ Capital Market under the symbols "AMRH". No assurance can be given that
our application will be approved. On September __, 2017, the last reported sale price for our common stock on the OTCQB was $____
per share. We are an "emerging growth company" as defined in Section 2(a) of the Securities Act of 1933, as amended,
and, as such, will be subject to reduced public reporting requirements.
Investing in our common stock may be
considered speculative and involves a high degree of risk, including the risk of losing your entire investment. See "Risk
Factors" beginning on page 9 to read about the risks you should consider before buying shares of our common stock.
Neither the Securities and Exchange
Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy
of this prospectus. Any representation to the contrary is a criminal offense.
Per Share
Underwriting
discounts and
commissions
(1)
Proceeds to
issuer
(1)
Initial public offering price
$
$
$
Underwriting discounts and commissions
(1)
Proceeds to us
(1)
We refer you to "Underwriting" beginning on page 75 of this prospectus for additional information regarding total underwriter compensation.
We have granted a 30-day "over-allotment"
option to the representative of the underwriters to purchase up to an additional _______ shares of common stock to cover allotments,
if any. The underwriters expect to deliver the shares to purchasers in the offering on or about ___________, 2017.
Sole Book-Running Manager
Ladenburg Thalmann
The date of this prospectus is ____________,
2017.
TABLE OF CONTENTS
Prospectus Summary
1
Risk Factors
9
Cautionary Note Regarding Forward-Looking Statements
27
Use of Proceeds
28
Dividend Policy
29
Capitalization
29
Price Range of Common Stock
30
Dilution
31
Description of Business
32
Management's Discussion and Analysis of Financial Condition and Results of Operations
39
Management
53
Executive Compensation
60
Certain Relationships and Related Transactions
67
Security Ownership of Certain Beneficial Owners and Management
69
Description of Capital Stock
71
Shares Eligible for Future Sale
74
Underwriting
75
Legal Matters
79
Experts
79
Where You Can Find More Information
79
You should rely
only on the information contained in this prospectus. We have not authorized anyone to provide you with different information from
that contained in this prospectus. We are not making an offer of these securities in any jurisdiction where the offer is not permitted.
You should not assume that the information contained in this prospectus is accurate as of any date other than the date on the front
cover of this prospectus.
Prospectus
Summary
This summary highlights
certain information appearing elsewhere in this prospectus. For a more complete understanding of this offering, you should read
the entire prospectus carefully, including the risk factors and the financial statements. Unless the context indicates otherwise,
the terms "Ameri", "the Company", "we", "us" and "our" refer to Ameri
Holdings, Inc., a Delaware corporation and its subsidiaries.
Our Company
We specialize in delivering
SAP cloud, digital and enterprise services to clients worldwide.
SAP is a leader in
providing enterprise resource planning ("ERP") software and technologies to enterprise customers worldwide. We deliver
a wide range of solutions and services across multiple domains and industries. Our services include strategic consulting, operational
leadership, digital transformation services, robotics process automation and co-creation of customized solutions, including those
in mobility, sustainability, big data and cloud computing.
Our SAP focus allows
us to provide technological solutions to a broad and growing base of clients. We are headquartered in Princeton, NJ, and have offices
across the United States, which are supported by delivery centers in India. Our model inverts the conventional global delivery
model wherein offshore information technology ("IT") service providers are based abroad and maintain a minimal presence
in the United States. With a strong SAP focus, our client partnerships anchor around SAP cloud services, artificial intelligence,
internet of things and robotic process automation. We pursue an acquisition strategy that seeks to disrupt the established business
model of offshore IT service providers.
With our innovative
solutions in enterprise architecture, ERP, predictive analytics and enterprise mobility, we provide companies worldwide with strategic
insights into their business which lead to a positive impact on their performance and profitability. In 2017, we signed a strategic
partnership agreement with NEC America to offer SAP HANA (a next generation enterprise database system) migration services. This
partnership will allow us to offer our clients a broader spectrum of services.
Our primary business
objective is to provide our clients with a competitive advantage by enhancing their business capabilities and technologies with
our expanding consulting services portfolio, which is aided by our business acquisitions. Our strategic acquisitions allow us to
bring global service delivery, SAP S/4 HANA and high-end SAP consulting capabilities to a broader geographic market and customer
base. We continue to leverage our growing geographical footprint and technical expertise to simultaneously expand our service and
product offering. With each acquisition, our goal is to identify business synergies that will allow us to bring new services and
products from one subsidiary to customers at our other subsidiaries. While we generate revenues from the consulting businesses
of each of our acquired subsidiaries, we believe that additional revenues will be generated through new business relationships
and services developed through our business combinations.
As of July 31, 2017,
we employed approximately 275 employees in 11 locations in the United States, Canada and India. For the twelve months ended December
31, 2016 and the twelve months ended December 31, 2015, we generated revenues of $36,145,589 and $20,261,172, respectively, and
incurred comprehensive net losses of $2,788,112 and $814,075 respectively. For the six months ended June 30, 2017 and the six months
ended June 30, 2016, we generated revenues of $24,609,186 and $13,699,902, respectively, and incurred comprehensive net losses
of $5,003,010 and $2,370,074 respectively.
Our Growth Strategy
Our growth strategy
is based on customer-driven business expansion and strategic acquisitions of SAP services companies. We introduce specific key
account management strategies to grow organically by cross selling and upselling different services across business units. It is
our goal to be a leader in the SAP cloud, digital and enterprise services market. We use strategic acquisitions, alliances and
partnerships to achieve this goal.
1
We have complementary
near-term and longer-term strategies. In the short-term, we continue to focus on high-end consulting and solutions in the SAP space.
Our medium-term focus will be to make an entry into cloud engagements and HANA. Signing up with NEC as a strategic partner for
the SAP HANA migration will be critical to achieving this objective. Additionally, we plan to gain market share in high-growth
areas within the SAP ecosystem such as Hybris, Success Factors and BI/BW/SAP HANA. In the long-term, we plan to identify and acquire
firms in the areas of Artificial Intelligence (AI) and robotics to bolster our AIR (AI + internet of things + robotics) practice.
We believe that during each phase of our growth strategy business and market conditions will require our plans to evolve or change,
and we plan to be agile in addressing both opportunities and exigencies.
The integration of
each of our acquisitions into our business enterprise requires establishing our company's standard operating procedures at
each acquired entity, seamlessly transitioning each acquired entity's branding to the "Ameri100" brand and assessing
any necessity to transition account management. The integration process also requires us to evaluate any product-line expansions
made possible by the acquired entity and how to bring new product lines to the broader customer base of the entire Company. With
the integration of each acquisition, we face challenges of maintaining cross-company visibility and cooperation, creating a cohesive
corporate culture, handling unexpected customer reactions and changes and aligning the interests of the acquired entity's
leadership with the interests of the Company. To date, these challenges have been manageable, and we are becoming more adept at
managing integration issues with each new acquisition.
Background
We were incorporated
under the laws of the State of Delaware in February 1994 as Spatializer Audio Laboratories, Inc., which was a shell company immediately
prior to our completion of a "reverse merger" transaction on May 26, 2015,
in
which we caused Ameri100 Acquisition, Inc., a Delaware corporation and our newly created, wholly owned subsidiary, to be merged
with and into Ameri and Partners Inc ("Ameri and Partners"), a Delaware corporation (the "Merger"). As
a result of the Merger, Ameri and Partners became our wholly owned subsidiary with Ameri and Partners' former stockholders
acquiring a majority of the outstanding shares of our common stock. The Merger was consummated under Delaware law, pursuant to
an Agreement of Merger and Plan of Reorganization, dated as of May 26, 2015 (the "Merger Agreement"),
and in
connection with the Merger we changed our name to AMERI Holdings, Inc. and do business under the brand name "Ameri100".
Ameri Holdings Inc.,
along with its twelve subsidiaries, Ameri and Partners, Ameri Consulting Service Private Ltd., Ameri100 Georgia Inc., Bellsoft
India Solutions Private Ltd., BSI Global IT Solutions Inc., Linear Logics, Corp. Winhire Inc, Ameri100 Virtuoso Inc., Ameri100
Arizona LLC, Bigtech Software Private Limited, Ameri100 California Inc. and Ameritas Technologies India Private Limited, provides
SAP cloud, digital and enterprise services to clients worldwide.
Organizational Chart
2
Additional Information
Our principal executive
offices are located at 100 Canal Pointe Blvd., Suite 108, Princeton, New Jersey 08540, and our telephone number is (732) 243-9250.
Our website is www.ameri100.com. Our website and the information contained therein or connected thereto shall not be deemed to
be incorporated herein, and you should not rely on any such information in making an investment decision.
Unless the context
indicates otherwise, as used in this prospectus, the terms the "Company," "we," "us," and "our"
refer to AMERI Holdings, Inc., a Delaware corporation, and its subsidiaries taken as a whole, unless otherwise noted.
Recent Acquisitions
Acquisition
of Ameri California
On
March 10, 2017, we acquired 100% of the shares of ATCG Technology Solutions, Inc. ("Ameri California"), a Delaware
corporation, pursuant to the terms of a Share Purchase Agreement among the Company, Ameri California, all of the stockholders of
Ameri California (the "Stockholders"), and the Stockholders' representative. In July 2017, the name of ATCG Technology
Solutions, Inc. was changed to Ameri100 California Inc. Ameri California provides U.S. domestic, offshore and onsite SAP consulting
services and has its main office in Folsom, California. Ameri California specializes in providing SAP Hybris, SAP Success Factors
and business intelligence services.
The
aggregate purchase price for the acquisition of Ameri California was $8,784,533, consisting of:
(a)
576,923 shares of our common stock, valued at approximately $3.8 million based on the closing price
of our common stock on the closing date of the acquisition;
(b)
Unsecured promissory notes issued to certain of Ameri California's selling stockholders for
the aggregate amount of $3,750,000 (which notes bear interest at a rate of 6% per annum and mature on June 30, 2018);
(c)
Earn-out payments in shares of our common stock (up to an aggregate value of $1,200,000 worth of
shares) to be paid, if earned, in each of 2018 and 2019 based on certain revenue and earnings before interest taxes, depreciation
and amortization ("EBITDA") targets as specified in the purchase agreement. We estimate those targets will be fully
achieved; and
(d)
An additional cash payment of $55,687 for cash that was left in Ameri California at closing.
Acquisition
of Ameri Arizona
On
July 29, 2016, we acquired 100% of the membership interests of DC&M Partners, L.L.C. ("Ameri Arizona"), an Arizona
limited liability company, pursuant to the terms of a Membership Interest Purchase Agreement by and among us, Ameri Arizona, all
of the members of Ameri Arizona, Giri Devanur and Srinidhi "Dev" Devanur, our President and Chief Executive Officer
and Executive Vice Chairman, respectively. In July 2017, the name of DC&M Partners, L.L.C. was changed to Ameri100 Arizona
LLC. Ameri Arizona is an SAP consulting company headquartered in Chandler, Arizona. Ameri Arizona provides its clients with a wide
range of information technology development, consultancy and management services with an emphasis on the design, build and rollout
of SAP implementations and related products. Ameri Arizona is also an SAP-certified software partner, having launched its SAP reporting,
extraction and distribution tool called "IRIS". Ameri Arizona services clients in diverse industries, including retail,
apparel/footwear, third-party logistics providers, chemicals, consumer goods, energy, high-tech electronics, media/entertainment
and aerospace.
The
aggregate purchase price for the acquisition of Ameri Arizona was $15,816,000, consisting of:
(a)
A cash payment in the amount of $3,000,000 at closing;
3
(b)
1,600,000 shares of our common stock (valued at approximately $10.4 million based on the $6.51
closing price of our common stock on the closing date of the acquisition), which are to be issued on July 29, 2018 or upon a change
of control of our company (whichever occurs earlier); and
(c)
Earn-out payments of $1,500,000 payable in cash each year to be paid, if earned, through 	the
achievement of annual revenue and gross margin targets in 2017 and 2018.
Acquisition
of Virtuoso
On
July 22, 2016, we, through wholly-owned acquisition subsidiaries, acquired all of the outstanding membership interests of Virtuoso,
L.L.C. ("Virtuoso"), a Kansas limited liability company, pursuant to the terms of an Agreement of Merger and Plan of
Reorganization, by and among us, Virtuoso Acquisition Inc., Ameri100 Virtuoso Inc., Virtuoso and the sole member of Virtuoso (the
"Sole Member"). Virtuoso is an SAP consulting firm specialized in providing services on SAP S/4 HANA finance, enterprise
mobility and cloud migration and is based in Leawood, Kansas. In connection with the merger, Virtuoso's name was changed
to Ameri100 Virtuoso Inc. The Virtuoso acquisition did not constitute a significant acquisition for the Company for purposes of
Regulation S-X.
The
total purchase price paid to the Sole Member for the acquisition of Virtuoso was $1,831,881, consisting of:
(a)
A cash payment in the amount of $675,000 which was due within 90 days of closing and was paid on
October 21, 2016;
(b)
101,250 shares of our common stock at closing, valued at approximately $700,000 based on the $6.51
closing price of our common stock on the closing date of the acquisition; and
(c)
Earn-out payments in cash and stock of $450,000 and approximately $560,807, respectively, to be
paid, if earned, through the achievement of annual revenue and gross margin targets in 2017, 2018 and 2019. Out of the total contingent
consideration of approximately $1,000,000, we only considered 50% of the earn-out in the purchase price, mainly due to the reorganization
of Virtuoso. The Virtuoso earn-out payments for 2016 amounted to $64,736 in cash and 12,408 shares of common stock as compared
to the potential earn-out of $231,968 under the terms of the purchase agreement.
Acquisition
of Bigtech Software Private Limited
On
June 23, 2016, we entered into a definitive agreement to purchase Bigtech Software Private Limited ("Bigtech"), a pure-play
SAP services company providing a wide range of SAP services including turnkey implementations, application management, training
and basis ABAP support. Based in Bangalore, India, Bigtech offers SAP services to improve business operations at companies of all
sizes and verticals. The acquisition of Bigtech was effective as of July 1, 2016, and the total consideration for the acquisition
of Bigtech was $850,000, consisting of:
(a)
A cash payment in the amount of $340,000 which was due within 90 days of closing and was paid on
September 22, 2016;
(b)
Warrants for the purchase of 51,000 shares of our common stock (valued at approximately $250,000
based on the $6.51 closing price of our common stock on the closing date of the acquisition), with such warrants exercisable for
two years; and
(c)
$255,000, which may become payable in cash earn-outs to the sellers of Bigtech, if Bigtech achieves
certain pre-determined revenue and EBITDA targets in 2017 and 2018. We estimate the earn-out payments to be earned at 100% of the
targets set forth in the purchase agreement.
4
Bigtech's
financial results are included in our condensed consolidated financial results starting July 1, 2016.  The Bigtech acquisition
did not constitute a significant acquisition for the Company for purposes of Regulation S-X. The valuation of Bigtech was made
on the basis of its projected revenues.
Acquisition
of Ameri Georgia
On
November 20, 2015, we completed the acquisition of Bellsoft, Inc., a consulting company based in Lawrenceville, Georgia with over
175 consultants specialized in the areas of SAP software, business intelligence, data warehousing and other enterprise resource
planning services. Following the acquisition, the name of Bellsoft, Inc. was changed to Ameri100 Georgia Inc. ("Ameri Georgia").
Ameri Georgia has operations in the United States, Canada and India. For financial accounting purposes, we recognized September
1, 2015 as the effective date of the acquisition. The total consideration for the acquisition of Ameri Georgia was $9,910,817,
consisting of:
(a)
A cash payment in the amount of $3,000,000, which was paid at closing;
(b)
235,295 shares of our common stock issued at closing, valued at approximately $1,000,000 based
on the closing price of our common stock on the closing date of the acquisition;
(c)
$250,000 quarterly cash payments to be paid on the last day of each calendar quarter of 2016;
(d)
A $1,000,000 cash reimbursement to be paid 5 days following closing to compensate Ameri Georgia
for a portion of its approximate cash balance as of September 1, 2015;
(e)
Approximately $2,910,817 paid within 30 days of closing in connection with the excess of Ameri
Georgia's accounts receivable over its accounts payable as of September 1, 2015; and
(f)
Earn-out payments of approximately $500,000 a year for 2016 and 2017, if earned through the achievement
of annual revenue and EBITDA targets specified in the purchase agreement, subject to downward or upward adjustment depending on
actual results. We estimate the earn-out payments to be earned at 100% of the targets set forth in the purchase agreement.
5
The Offering
Common stock offered by us
__________ shares of common stock
Common stock outstanding prior to this offering
14,650,412 shares
(1)
Common stock outstanding after this offering
__________ shares
(1)
Use of proceeds
We intend to use the net proceeds of this offering to finance possible acquisitions of, or investments in, competitive businesses and for working capital and general corporate purposes.  We currently have no commitments in place with respect to any acquisitions or investments.
OTCQB Marketplace symbol
AMRH
We have applied for the listing
of our common stock on The Nasdaq Capital Market under the symbol "AMRH", and expect such listing to occur concurrently
with this offering.
Risk factors
See "Risk Factors" beginning on page 9 and the other information included in this prospectus for a discussion of factors you should carefully consider before deciding to invest in our common stock.
(1)
Based on 14,650,412 shares outstanding on September __, 2017, the number of shares to be outstanding
after this offering excludes the following:
·
309,642 shares of common stock reserved for issuance upon the exercise of outstanding stock options
and the settlement of restricted stock units under our 2015 Equity Incentive Award Plan;
·
2,666,666 shares of common stock reserved for issuance upon the exercise of outstanding warrants
(for which cash would need to be remitted for us to exercise); and
·
_______ shares of common stock reserved for issuance under the underwriters' over-allotment
option.
6
SUMMARY CONSOLIDATED FINANCIAL INFORMATION
The following summary consolidated statements of operations
data for the fiscal years ended December 31, 2016 and 2015 have been derived from our audited consolidated financial statements
included elsewhere in this prospectus. Additionally, the consolidated statement of operations data for the six months ended June
30, 2016 and 2017 have been derived from our unaudited consolidated financial statements included elsewhere in this prospectus.
The summary consolidated balance sheet data as of June 30, 2017 are derived from our consolidated financial statements that are
included elsewhere in this prospectus. The historical financial data presented below is not necessarily indicative of our financial
results in future periods, and the results for the quarter ended June 30, 2017 is not necessarily indicative of our operating results
to be expected for the full fiscal year ending December 31, 2017 or any other period. You should read the summary consolidated
financial data in conjunction with those financial statements and the accompanying notes and "Management's Discussion
and Analysis of Financial Condition and Results of Operations." Our consolidated financial statements are prepared and presented
in accordance with United States generally accepted accounting principles, or U.S. GAAP. Our consolidated financial statements
have been prepared on a basis consistent with our audited financial statements and include all adjustments, consisting of normal
and recurring adjustments that we consider necessary for a fair presentation of the financial position and results of operations
as of and for such periods.
Fiscal Years Ended December 31,
2016
2015
Consolidated Statement of Operations Data:
Total Revenues
$
36,145,589
$
20,261,172
Total Cost of Revenues
29,608,932
13,391,504
Gross Profit (Loss)
6,536,657
6,869,668
Total Operating Expenses
11,916,520
7,663,650
Income (Loss) From Operations
(5,379,863
)
(793,982
)
Total Other Income (Expense)
(1,145,287
)
(148,553
)
Net income (loss) before income taxes
(6,525,150
)
(942,535
)
Income tax benefit (provision)
3,747,846
128,460
Net income (loss)
$
(2,777,304
)
$
(814,075
)
Non-controlling interest
(3,382
)
—
Net income (loss) attributable to the Company
$
(2,780,686
)
$
(814,075
)
Foreign exchange translation adjustment
(7,426
)
—
Comprehensive income (loss)
$
(2,788,112
)
$
(814,075
)
Net Loss Applicable to Common Stock Per Common Share
Basic and Diluted
$
(0.21
)
$
(0.07
)
Weighted Average Shares Outstanding
13,068,597
11,101,198
Basic and Diluted
$
(0.21
)
$
(0.07
)
Six Months Ended June 30,
2017
2016
Consolidated Statement of Operations Data:
Total Revenues
$
24,609,186
$
13,699,902
Total Cost of Revenues
18,975,045
10,926,845
Gross Profit (Loss)
5,634,141
2,773,057
Total Operating Expenses
9,772,964
4,691,012
Income (Loss) From Operations
(4,138,823
)
(1,917,955
)
Total Other Income (Expense)
149,326
(386,421
)
Net income (loss) before income taxes
(3,989,497
)
(2,304,376
)
Income tax benefit (provision)
—
—
Net income (loss)
$
(3,989,497
)
$
(2,304,376
)
Non-controlling interest
(11,872
)
—
Net income (loss) attributable to the Company
$
(4,001,369
)
$
(2,304,376
)
Dividend on preferred stock
(1,004,791
)
—
Net income (loss) attributable to common stockholders
(5,006,160
)
(2,304,376
)
Foreign exchange translation adjustment
3,150
(65,698
)
Comprehensive income (loss)
$
(5,003,010
)
$
(2,370,074
)
Net Loss Applicable to Common Stock Per Common Share
Basic and Diluted
$
(0.35
)
$
(0.19
)
Weighted Average Shares Outstanding
Basic and Diluted
$
14,352,573
$
12,359,709
7
As of
June 30, 2017
Actual
As
Adjusted
(1)
Consolidated Balance Sheet Data:
Cash
$
1,041,133
$
Total other assets
46,251,707
Total liabilities
33,672,974
Series A preferred stock
3,737
Total stockholders' equity
13,619,866
———————
(1)
As adjusted amounts give effect to  the sale of the shares in this offering at the assumed public offering price of $___ per share, after deducting underwriting discounts and commissions and other estimated offering expenses payable by us.
8
Risk
Factors
Investing in our
securities involves a high degree of risk. You should consider carefully the risks and uncertainties described below, together
with all of the other information in this prospectus, including our consolidated financial statements and related notes, before
deciding whether to purchase any of our securities. Any of these risks may have a material adverse effect on our business, financial
condition, results of operations and cash flows and our prospects could be harmed. In that event, the price of our securities could
decline and you could lose part or all of your investment.
Risks Relating to Our Business and Industry
We recorded a net loss for
the twelve months ended December 31, 2016 and the six months ended June 30 2017, and there can be no assurance that our future
operations will result in net income.
For the twelve months
ended December 31, 2016, we had net revenue of $36,145,589 and comprehensive loss of $2,788,112. For the six months ended June
30, 2017 and the six months ended June 30, 2016, we generated revenues of $24,609,186 and $13,699,902, respectively, and incurred
comprehensive net losses of $5,003,010 and $2,370,074 respectively. At June 30, 2017, we had stockholders' equity of $13,619,866.
There can be no assurance that our future operations will result in net income. Our failure to increase our revenues or improve
our gross margins will harm our business. We may not be able to sustain or increase profitability on a quarterly or annual basis
in the future. If our revenues grow more slowly than we anticipate, our gross margins fail to improve or our operating expenses
exceed our expectations, our operating results will suffer. The fee we charge for our solutions and services may decrease, which
would reduce our revenues and harm our business. If we are unable to sell our solutions at acceptable prices relative to our costs,
or if we fail to develop and introduce new solutions on a timely basis and services from which we can derive additional revenues,
our financial results will suffer.
We and our subsidiaries have
limited operating histories and therefore we cannot ensure the long-term successful operation of our business or the execution
of our business plan.
Our prospects must
be considered in light of the risks, expenses and difficulties frequently encountered by growing companies in new and rapidly evolving
markets, such as the technology consulting markets in which we operate. We must meet many challenges including:
·
establishing and maintaining broad market acceptance of our solutions and services and converting
that acceptance into direct and indirect sources of revenue;
·
establishing and maintaining adoption of our technology solutions in a wide variety of industries
and on multiple enterprise architectures;
·
timely and successfully developing new solutions and services and increasing the functionality
and features of existing solutions and services;
·
developing solutions and services that result in high degree of enterprise client satisfaction
and high levels of end-customer usage;
·
successfully responding to competition, including competition from emerging technologies and solutions;
·
developing and maintaining strategic relationships to enhance the distribution, features, content
and utility of our solutions and services; and
·
identifying, attracting and retaining talented personnel at reasonable market compensation rates
in the markets in which we employ.
Our business strategy
may be unsuccessful and we may be unable to address the risks we face in a cost-effective manner, if at all. If we are unable to
successfully address these risks our business will be harmed.
9
We face working capital constraints
and may not have sufficient working capital in the long term and there is no assurance that we will be able to obtain additional
financing, which could negatively impact our business.
We currently face working
capital constraints and are not current in all payments to our vendors, a few of which have threatened legal action against us
but have not yet commenced any legalproceeding. We are working with these vendors to negotiate longer payment terms until we are
able to raise more capital. We are making efforts to mitigate our working capital constraints overall by raising more capital and
streamlining our operations to provide greater cash savings. There can be no assurance that we will be able to secure additional
sources of capital or that cost savings will provide sufficient working capital. In the event we are unable to pay outstanding
vendor payable, those vendors may take legal action against us or stop doing business with us, which may have a negative impact
on our revenue and financial results.
It is likely we may
require additional funds in the long term depending upon the growth of our revenues and our business strategy. We can give no assurance
that we will be able to obtain sufficient debt or equity capital now or in the future to support our operations. Should we be unable
to raise sufficient debt or equity capital, we could be forced to cease operations. Our plan regarding these matters is to raise
additional debt and/or equity financing to allow us the ability to cover our current cash flow requirements and meet our obligations
as they become due. There can be no assurances that financing will be available or if available, that such financing will be available
under favorable terms. In the event that we are unable to generate adequate revenues to cover expenses and cannot obtain additional
financing in the future, our business and financial condition could be harmed.
The economic environment,
pricing pressures, and decreased employee utilization rates could negatively impact our revenues and operating results.
Spending on technology
products and services is subject to fluctuations depending on many factors, including the economic environment in the markets in
which our clients operate.
Reduced ERP spending
in response to a challenging economic environment leads to increased pricing pressure from our clients, which may adversely impact
our revenue, gross profits, operating margins and results of operations.
In addition to the
business challenges and margin pressure resulting from economic slowdown in the markets in which our clients operate and the response
of our clients to such slowdown, there is also a growing trend among consumers of ERP services towards consolidation of technology
service providers in order to improve efficiency and reduce costs. Our success in the competitive bidding process for new projects
or in retaining existing projects is dependent on our ability to fulfil client expectations relating to staffing, delivery of services
and more stringent service levels. If we fail to meet a client's expectations in such projects, this would likely adversely
impact our business, revenues and operating margins. In addition, even if we are successful in winning the mandates for such projects,
we may experience significant pressure on our operating margins as a result of the competitive bidding process.
Moreover, our ability
to maintain or increase pricing is restricted as clients often expect that as we do more business with them, they will receive
volume discounts or lower rates. In addition, existing and new customers are also increasingly using third-party consultants with
broad market knowledge to assist them in negotiating contractual terms. Any inability to maintain or increase pricing on account
of this practice may also adversely impact our revenues, gross profits, operating margins and results of operations.
Uncertain global SAP consulting
market conditions may continue to adversely affect demand for our services.
We rely heavily on
global demand for ERP services, especially SAP consulting by customers. Any weakness for these ERP services by global customers
will adversely affect our revenue projections and hence our profits. SAP AG is adapting itself to the changes in the market especially
towards cloud offerings. These changes may lead to SAP losing its market share to other competitors like Oracle, Microsoft, Salesforce
and WorkDay among many other newer players. With these setbacks to SAP, we may face uncertain future due to dramatic changes in
the market place which in turn will affect our revenues and profits.
10
Our success depends
largely upon our highly-skilled technology professionals and our ability to hire, attract, motivate, retain and train these personnel.
Our ability to execute
projects, maintain our client relationships and acquire new clients depends largely on our ability to attract, hire, train, motivate
and retain highly skilled technology professionals, particularly project managers and other mid-level professionals. If we cannot
hire, motivate and retain personnel, our ability to bid for projects, obtain new projects and expand our business will be impaired
and our revenues could decline.
Increasing worldwide
competition for skilled technology professionals and increased hiring by technology companies may affect our ability to hire and
retain an adequate number of skilled and experienced technology professionals, which may in turn have an adverse effect on our
business, results of operations and financial condition.
In addition, the demands
of changes in technology, evolving standards and changing client preferences may require us to redeploy and retrain our technology
professionals. If we are unable to redeploy and retrain our technology professionals to keep pace with continuing changes in technology,
evolving standards and changing client preferences, this may adversely affect our ability to bid for and obtain new projects and
may have a material adverse effect on our business, results of operations and financial condition.
Our strategy to increase our
growth through acquisitions may be unsuccessful and could adversely affect our business and results.
As part of our growth
strategy, we intend to further acquire other businesses; however, there is no assurance that we will be able to identify appropriate
acquisition targets, successfully acquire identified targets or successfully integrate the business of acquired companies to realize
the full benefits of the combined businesses.
While we recently acquired
Ameri California, Ameri Arizona, Virtuoso and Bigtech in connection with our growth strategy to acquire other businesses, we can
provide no assurance that we will identify appropriate acquisition targets, successfully complete any future acquisitions or successfully
integrate the business of companies we do acquire. Even if we successfully acquire a business entity, there is no assurance that
our combined business will become profitable. The process of completing the integration of acquired businesses could cause an interruption
of, or loss of momentum in, the activities of our company and the loss of key personnel. The diversion of management's attention
and any delays or difficulties encountered in connection with the pursuit of business acquisitions and the integration of acquired
businesses, and the incurrence of significant, acquisition related costs in connection with proposed and completed acquisitions,
could have an adverse effect on our business, financial condition or results of operations.
We face intense competition
from other service providers.
We are subject to intense
competition in the industry in which we operate which may adversely affect our results of operations, financial condition and cash
flows. We operate in a highly competitive industry, which is served by numerous global, national, regional and local firms. Our
industry has experienced rapid technological developments, changes in industry standards and customer requirements. The principal
competitive factors in the IT markets include the range of services offered, size and scale of service provider, global reach,
technical expertise, responsiveness to client needs, speed in delivery of IT solutions, quality of service and perceived value.
Many companies also choose to perform some or all of their back-office IT and IT-enabled operations internally. Such competitiveness
requires us to keep pace with technological developments and maintains leadership; enhance our service offerings, including the
breadth of our services and portfolio, and address increasingly sophisticated customer requirements in a timely and cost-effective
manner.
We market our service
offerings to large and medium-sized organizations. Generally, the pricing for the projects depends on the type of contract, which
includes time and material contracts, annual maintenance contracts (fixed time frame), fixed price contracts and transaction price
based contracts. The intense competition and the changes in the general economic and business conditions can put pressure on us
to change our prices. If our competitors offer deep discounts on certain services or provide services that the marketplace considers
more valuable, we may need to lower prices or offer other favorable terms in order to compete successfully. Any broad-based change
to our prices and pricing policies could cause revenues to decline and may reduce margins and could adversely affect results of
operations, financial condition and cash flows. Some of our competitors may bundle software products and services for promotional
purposes or as a long-term pricing strategy or provide guarantees of prices and product implementations. These practices could,
over time, significantly constrain the prices that we can charge for certain services. If we do not adapt our pricing models to
reflect changes in customer use of our services or changes in customer demand, our revenues and cash flows could decrease.
11
Our competitors may
have significantly greater financial, technical and marketing resources and greater name recognition and, therefore, may be better
able to compete for new work and skilled professionals. Similarly, if our competitors are successful in identifying and implementing
newer service enhancements in response to rapid changes in technology and customer preferences, they may be more successful at
selling their services. If we are unable to respond to such changes our results of operations may be harmed. Further, a client
may choose to use its own internal resources rather than engage an outside firm to perform the types of services we provide. We
cannot be certain that we will be able to sustain our current levels of profitability or growth in the face of competitive pressures,
including competition for skilled technology professionals and pricing pressure from competitors employing an on-site/offshore
business model.
In addition, we may
face competition from companies that increase in size or scope as the result of strategic alliances such as mergers or acquisitions.
These transactions may include consolidation activity among hardware manufacturers, software companies and vendors and service
providers. The result of any such vertical integration may be greater integration of products and services that were once offered
separately by independent vendors. Our access to such products and services may be reduced as a result of such an industry trend,
which could adversely affect our competitive position. These types of events could have a variety of negative effects on our competitive
position and our financial results, such as reducing our revenue, increasing our costs, lowering our gross margin percentage and
requiring us to recognize impairments on our assets.
Our business could be adversely
affected if we do not anticipate and respond to technology advances in our industry and our clients' industries.
The IT and global outsourcing
and SAP consulting services industries are characterized by rapid technological change, evolving industry standards, changing client
preferences and new product introductions. Our success will depend in part on our ability to develop IT solutions that keep pace
with industry developments. We may not be successful in addressing these developments on a timely basis or at all. In addition,
products or technologies developed by others may not render our services noncompetitive or obsolete. Our failure to address these
developments could have a material adverse effect on our business, results of operations, financial condition and cash flows.
A significant number
of organizations are attempting to migrate business applications to advanced technologies. As a result, our ability to remain competitive
will be dependent on several factors, including our ability to develop, train and hire employees with skills in advanced technologies,
breadth and depth of process and technology expertise, service quality, knowledge of industry, marketing and sales capabilities.
Our failure to hire, train and retain employees with such skills could have a material adverse impact on our business. Our ability
to remain competitive will also be dependent on our ability to design and implement, in a timely and cost- effective manner, effective
transition strategies for clients moving to advanced architectures. Our failure to design and implement such transition strategies
in a timely and cost-effective manner could have a material adverse effect on our business, results of operations, financial condition
and cash flows.
Our operations and assets in
India expose us to regulatory, economic, political and other uncertainties in India, which could harm our business.
We have an offshore
presence in India where a number of our technical professionals are located. In the past, the Indian economy has experienced many
of the problems confronting the economies of developing countries, including high inflation and varying gross domestic product
growth. Salaries and other related benefits constitute a major portion of our total operating costs. Many of our employees based
in India where our wage costs have historically been significantly lower than wage costs in the United States and Europe for comparably
skilled professionals, and this has been one of our competitive advantages. However, wage increases in India or other countries
where we have our operations may prevent us from sustaining this competitive advantage if wages increase. We may need to increase
the levels of our employee compensation more rapidly than in the past to retain talent. If such events occur, we may be unable
to continue to increase the efficiency and productivity of our employees and wage increases in the long term may reduce our profit
margins.
12
Our clients may seek to reduce
their dependence on India for outsourced IT services or take advantage of the services provided in countries with labor costs similar
to or lower than India.
Clients which presently
outsource a significant proportion of their IT services requirements to vendors in India may, for various reasons, including in
response to rising labor costs in India and to diversify geographic risk, seek to reduce their dependence on one country. We expect
that future competition will increasingly include firms with operations in other countries, especially those countries with labor
costs similar to or lower than India, such as China, the Philippines and countries in Eastern Europe. Since wage costs in our industry
in India are increasing, our ability to compete effectively will become increasingly dependent on our reputation, the quality of
our services and our expertise in specific industries. If labor costs in India rise at a rate that is significantly greater than
labor costs in other countries, our reliance on the labor in India may reduce our profit margins and adversely affect our ability
to compete, which would, in turn, have a negative impact on our results of operations.
Our business could be materially
adversely affected if we do not or are unable to protect our intellectual property or if our services are found to infringe upon
or misappropriate the intellectual property of others.
Our success depends
in part upon certain methodologies and tools we use in designing, developing and implementing applications systems in providing
our services. We rely upon a combination of nondisclosure and other contractual arrangements and intellectual property laws to
protect confidential information and intellectual property rights of ours and our third parties from whom we license intellectual
property. We enter into confidentiality agreements with our employees and limit distribution of proprietary information. The steps
we take in this regard may not be adequate to deter misappropriation of proprietary information and we may not be able to detect
unauthorized use of, protect or enforce our intellectual property rights. At the same time, our competitors may independently develop
similar technology or duplicate our products or services. Any significant misappropriation, infringement or devaluation of such
rights could have a material adverse effect upon our business, results of operations, financial condition and cash flows.
Litigation may be required
to enforce our intellectual property rights or to determine the validity and scope of the proprietary rights of others. Any such
litigation could be time consuming and costly. Although we believe that our services do not infringe or misappropriate on the intellectual
property rights of others and that we have all rights necessary to utilize the intellectual property employed in our business,
defense against these claims, even if not meritorious, could be expensive and divert our attention and resources from operating
our company. A successful claim of intellectual property infringement against us could require us to pay a substantial damage award,
develop non-infringing technology, obtain a license or cease selling the products or services that contain the infringing technology.
Such events could have a material adverse effect on our business, financial condition, results of operations and cash flows.
Any disruption in the supply
of power, IT infrastructure and telecommunications lines to our facilities could disrupt our business process or subject us to
additional costs.
Any disruption in basic
infrastructure, including the supply of power, could negatively impact our ability to provide timely or adequate services to our
clients. We rely on a number of telecommunications service and other infrastructure providers to maintain communications between
our various facilities and clients in India, the United States and elsewhere. Telecommunications networks are subject to failures
and periods of service disruption, which can adversely affect our ability to maintain active voice and data communications among
our facilities and with our clients. Such disruptions may cause harm to our clients' business. We do not maintain business
interruption insurance and may not be covered for any claims or damages if the supply of power, IT infrastructure or telecommunications
lines is disrupted. This could disrupt our business process or subject us to additional costs, materially adversely affecting our
business, results of operations, financial condition and cash flows.
13
System security risks and cyber-attacks
could disrupt our information technology services provided to customers, and any such disruption could reduce our expected revenue,
increase our expenses, damage our reputation and adversely affect our stock price.
Security and availability
of IT infrastructure is of the utmost concern for our business, and the security of critical information and infrastructure necessary
for rendering services is also one of the top priorities of our customers.
System security risks
and cyber-attacks could breach the security and disrupt the availability of our IT services provided to customers. Any such breach
or disruption could allow the misuse of our information systems, resulting in litigation and potential liability for us, the loss
of existing or potential clients, damage to our reputation and diminished brand value and could have a material adverse effect
on our financial condition.
Our network and our
deployed security controls could also be penetrated by a skilled computer hacker or intruder. Further, a hacker or intruder could
compromise the confidentiality and integrity of our protected information, including personally identifiable information; deploy
malicious software or code like computer viruses, worms or Trojan horses, etc. may exploit any security vulnerabilities, known
or unknown, of our information system; cause disruption in the availability of our information and services; and attack our information
system through various other mediums.
We also procure software
or hardware products from third party vendors that provide, manage and monitor our services. Such products may contain known or
unfamiliar manufacturing, design or other defects which may allow a security breach or cyber-attack, if exploited by a computer
hacker or intruder, or may be capable of disrupting performance of our IT services and prevent us from providing services to our
clients.
In addition, we manage,
store, process, transmit and have access to significant amounts of data and information that may include our proprietary and confidential
information and that of our clients. This data may include personal information, sensitive personal information, personally identifiable
information or other critical data and information, of our employees, contractors, officials, directors, end customers of our clients
or others, by which any individual may be identified or likely to be identified. Our data security and privacy systems and procedures
meet applicable regulatory standards and undergo periodic compliance audits by independent third parties and customers. However,
if our compliance with these standards is inadequate, we may be subject to regulatory penalties and litigation, resulting in potential
liability for us and an adverse impact on our business.
We are still susceptible
to data security or privacy breaches, including accidental or deliberate loss and unauthorized disclosure or dissemination of such
data or information. Any breach of such data or information may lead to identity theft, impersonation, deception, fraud, misappropriation
or other offenses in which such information may be used to cause harm to our business and have a material adverse effect on our
financial condition, business, results of operations and cash flows.
We must effectively manage
the growth of our operations, or our company will suffer.
Our ability to successfully
implement our business plan requires an effective planning and management process. If funding is available, we intend to increase
the scope of our operations and acquire complimentary businesses. Implementing our business plan will require significant additional
funding and resources. If we grow our operations, we will need to hire additional employees and make significant capital investments.
If we grow our operations, it will place a significant strain on our existing management and resources. If we grow, we will need
to improve our financial and managerial controls and reporting systems and procedures, and we will need to expand, train and manage
our workforce. Any failure to manage any of the foregoing areas efficiently and effectively would cause our business to suffer.
Our revenues are concentrated
in a limited number of clients and our revenues may be significantly reduced if these clients decrease their IT spending.
Our client contracts
are based on time and materials expenses. We do not have long-term client contracts. Our client contracts contain standard payment
terms, and our clients only pay us for services rendered. We have limited exposure for non-payment by our clients and do not have
any unresolved client debts. While our client contracts can be terminated with little or no notice, it is uncommon for our clients
to terminate an engagement in the middle of the implementation of services.
14
For the twelve-month
period ended December 31, 2016, sales to five major customers accounted for 52.75% of our total revenue, and for the six-month
period ended June 30, 2017, sales to five major customers accounted for 42% of our total revenue. Consequently, if our top clients
reduce or postpone their IT spending significantly, this may lower the demand for our services and negatively affect our revenues
and profitability. Further, any significant decrease in the growth of the financial services or other industry segments on which
we focus may reduce the demand for our services and negatively affect our revenues, profitability and cash flows.
Our client contracts
can typically be terminated without cause and with little or no notice or penalty, which could negatively impact our revenues and
profitability.
Our clients typically
retain us on a non-exclusive, project-by-project basis. Many of our client contracts can be terminated with or without cause.Our
business is dependent on the decisions and actions of our clients, and there are a number of factors relating to our clients that
are outside of our control which might lead to termination of a project or the loss of a client, including:
·
financial difficulties for a client;
·
a change in strategic priorities, resulting in a reduced level of technology spending;
·
a demand for price reductions; or an unwillingness to accept higher pricing due to various factors
such as higher wage costs, higher cost of doing business;
·
a change in outsourcing strategy by moving more work to the client's in-house technology departments
or to our competitors;
·
the replacement by our clients of existing software with packaged software supported by licensors;
·
mergers and acquisitions;
·
consolidation of technology spending by a client, whether arising out of mergers and acquisitions,
or otherwise; and
·
sudden ramp-downs in projects due to an uncertain economic environment.
Our inability to control
the termination of client contracts could have a negative impact on our financial condition and results of operations.
Our engagements
with customers are typically singular in nature and do not necessarily provide for subsequent engagements.
Our clients generally
retain us on a short-term, engagement-by-engagement basis in connection with specific projects, rather than on a recurring basis
under long-term contracts. Although a substantial majority of our revenues are generated from repeat business, which we define
as revenues from a client who also contributed to our revenues during the prior fiscal year, our engagements with our clients are
typically for projects that are singular in nature. Therefore, we must seek out new engagements when our current engagements are
successfully completed or terminated, and we are constantly seeking to expand our business with existing clients and secure new
clients for our services. In addition, in order to continue expanding our business, we may need to significantly expand our sales
and marketing group, which would increase our expenses and may not necessarily result in a substantial increase in business. If
we are unable to generate a substantial number of new engagements for projects on a continual basis, our business and results of
operations would likely be adversely affected.
15
Our results of operations may
fluctuate from quarter to quarter, which could affect our business, financial condition and results of operations.
Our results of operations
may fluctuate from quarter to quarter depending upon several factors, some of which are beyond our control. These factors include
the timing and number of client projects commenced and completed during the quarter, the number of working days in a quarter, employee
hiring, attrition and utilization rates and the mix of time-and-material projects versus fixed price deliverable projects and maintenance
projects during the quarter. Additionally, periodically our cost increases due to both the hiring of new employees and strategic
investments in infrastructure in anticipation of future opportunities for revenue growth.
These and other factors
could affect our business, financial condition and results of operations, and this makes the prediction of our financial results
on a quarterly basis difficult. Also, it is possible that our quarterly financial results may be below the expectations of public
market analysts.
We are heavily dependent on
our senior management, and a loss of a member of our senior management team could cause our stock price to suffer.
If we lose Giri Devanur,
our President and Chief Executive Officer, or Viraj Patel, our Chief Financial Officer, we may not be able to find appropriate
replacements on a timely basis, and our business could be adversely affected. Our existing operations and continued future development
depend to a significant extent upon the performance and active participation of certain key individuals. We do not currently maintain
key man insurance. If we were to lose any of our key personnel, we may not be able to find appropriate replacements on a timely
basis and our financial condition and results of operations could be materially adversely affected.
Certain key employees of our
recently acquired subsidiaries may terminate their employment with us after their applicable "earn-out" periods end,
which could negatively impact our business.
Certain key employees
of our recently acquired subsidiaries are entitled to earn-out compensation upon the achievement of certain financial targets by
the acquired subsidiary following the closing of the acquisition. Upon the completion of the applicable earn-out period, these
key employees may terminate their employment with us. The loss of these key employees could negatively impact our business due
to the related loss of the historical associations of those key employees with markets and customers of our subsidiaries.
Our international sales and
operations are subject to applicable laws relating to trade, export controls and foreign corrupt practices, the violation of which
could adversely affect its operations.
We must comply with
all applicable international trade, customs, export controls and economic sanctions laws and regulations of the United States and
other countries. We are also subject to the Foreign Corrupt Practices Act and other anti-bribery laws that generally bar bribes
or unreasonable gifts to foreign governments or officials. Changes in trade sanctions laws may restrict our business practices,
including cessation of business activities in sanctioned countries or with sanctioned entities, and may result in modifications
to compliance programs. Violation of these laws or regulations could result in sanctions or fines and could have a material adverse
effect on our financial condition, results of operations and cash flows.
16
Our income tax returns are
subject to review by taxing authorities, and the final determination of our tax liability with respect to tax audits and any related
litigation could adversely affect our financial results.
Although we believe
that our tax estimates are reasonable and that we prepare and submit our tax filings on a timely basis and in accordance with all
applicable tax laws, the final determination with respect to any tax audits, and any related litigation, could be materially different
from our estimates or from our historical income tax provisions and accruals. The results of an audit or litigation could have
a material effect on operating results and/or cash flows in the periods for which that determination is made. In addition, future
period earnings may be adversely impacted by litigation costs, settlements, penalties and/or interest assessments.
Failure of our customers to
pay the amounts owed to us in a timely manner may adversely affect our financial condition and operating results.
We generally provide
payment terms ranging from 30 to 75 days. We do not have any bad client debts and we do not have significent aged accounts receivable.
As a result, we generate significant accounts receivable from sales to our customers, representing approximately 80% of current
assets as of December 31, 2016 and approximately 81% of current assets as of June 30, 2017. Accounts receivable from sales to customers
were $8,059,910 as of December 31, 2016 and $8,720,203 as of June 30, 2017. As of June 30, 2017, the largest amount owed by a single
customer was approximately 10% of total accounts receivable. As of June 30, 2017, we had no allowance for doubtful accounts. If
any of our significant customers have insufficient liquidity, we could encounter significant delays or defaults in payments owed
to us by such customers, and we may need to extend our payment terms or restructure the receivables owed to us, which could have
a significant adverse effect on our financial condition. Any deterioration in the financial condition of our customers will increase
the risk of uncollectible receivables. Global economic uncertainty could also affect our customers' ability to pay our receivables
in a timely manner or at all or result in customers going into bankruptcy or reorganization proceedings, which could also affect
our ability to collect our receivables.
If we are unable
to collect our dues or receivables from or invoice our unbilled services to our clients, our results of operations and cash flows
could be adversely affected.
Our business depends
on our ability to successfully obtain payments from our clients of the amounts they owe us for work performed. We evaluate the
financial condition of our clients and usually bill and collect on relatively short cycles. Macroeconomic conditions, such as a
potential credit crisis in the global financial system, could result in financial difficulties for our clients, including limited
access to the credit markets, insolvency or bankruptcy. Such conditions could cause clients to delay payment, request modifications
of their payment terms, or default on their payment obligations to us, all of which could increase our receivables. If we experience
delays in the collection of, or are unable to collect, our client balances, our results of operations and cash flows could be adversely
affected. In addition, if we experience delays in billing and collection for our services, our cash flows could be adversely affected.
Goodwill that we
carry on our balance sheet could give rise to significant impairment charges in the future.
Goodwill is subject
to impairment review at least annually. Impairment testing under standards as issued by the Financial Accounting Standards Board
may lead to impairment charges in the future. Any significant impairment charges could have a material adverse effect on our results
of operations
Our revenue and
operating results may be affected by the rate of growth in the use of technology in business and the type and level of technology
spending by our clients.
Our business depends,
in part, upon continued reliance on the use of technology in business by our clients and prospective clients as well as their customers
and suppliers. In particular, the success of our new service offerings requires continued demand for such services and our ability
to meet this demand in a cost-effective manner. In challenging economic environments, our clients may reduce or defer their spending
on new technologies in order to focus on other priorities and prospective clients may decide not to engage our services. Also,
many companies have already invested substantial resources in their current means of conducting commerce and exchanging information,
and they may be reluctant or slow to adopt new approaches that could disrupt existing personnel, processes and infrastructures.
If the growth of technology usage in business, or our clients' spending on such technology, declines, or if we cannot convince
our clients or potential clients to embrace new technological solutions, our revenue and operating results could be adversely affected.
Our business will
suffer if we fail to anticipate and develop new services and enhance existing services in order to keep pace with rapid changes
in technology and the industries on which we focus.
The ERP services market
is characterized by rapid technological changes, evolving industry standards, changing client preferences and new product and service
introductions. Our future success will depend on our ability to anticipate these advances and enhance our existing offerings or
develop new product and service offerings to meet client needs. We may not be successful in anticipating or responding to these
advances on a timely basis, or, if we do respond, the services or technologies we develop may not be successful in the marketplace.
We may also be unsuccessful in stimulating customer demand for new and upgraded products, or seamlessly managing new product introductions
or transitions. Further, products, services or technologies that are developed by our competitors may render our services non-competitive
or obsolete. Our failure to address the demands of the rapidly evolving information technology environment, particularly with respect
to digital technology, the internet of things, artificial intelligence, cloud computing and storage, mobility and applications
and analytics, could have a material adverse effect on our business, results of operations and financial condition.
17
Changes in laws or regulations,
or a failure to comply with any laws and regulations, may adversely affect our business, investments and results of operations.
We are subject to laws
and regulations enacted by national, regional and local governments, including non-U.S. governments. In particular, we are required
to comply with certain Securities and Exchange Commission (the "SEC") and other legal requirements. Compliance with,
and monitoring of, applicable laws and regulations may be difficult, time consuming and costly. Those laws and regulations and
their interpretation and application may also change from time to time and those changes could have a material adverse effect on
our business, investments and results of operations. In addition, a failure to comply with applicable laws or regulations, as interpreted
and applied, could have a material adverse effect on our business and results of operations.
Our international operations
subject us to exposure to foreign currency fluctuations.
We
have operations in three countries and as we expand our international operations, more of our customers pay us in foreign currencies.
Transactions in currencies other than U.S. dollars subject us to fluctuations in currency exchange rates. Accordingly, changes
in exchange rates between the U.S. dollar and other currencies could have a material adverse effect on our revenues and net income,
which may in turn have a negative impact on our business, results of operations, financial condition and cash flows. The exchange
rate between the U.S. dollar and other currencies has changed substantially in recent years and may fluctuate in the future. We
expect that the vast majority of our revenues will continue to be generated in U.S. dollars for the foreseeable future and that
a significant portion of our expenses, including personnel costs, as well as capital and operating expenditures, will continue
to be denominated in other currencies such as Indian Rupee. The hedging strategies that we may implement in the future to mitigate
foreign currency exchange rate risks may not reduce or completely offset our exposure to foreign exchange rate fluctuations and
may expose our business to unexpected market, operational and counterparty credit risks. Accordingly, we may incur losses from
our use of foreign exchange derivate contracts that could have a material adverse effect on our business, results of operations
and financial condition.
Acquisitions, expansions or
infrastructure investments may require us to increase our level of indebtedness or issue additional equity.
As we continue to consummate
additional acquisition opportunities, undertake additional expansion activities or make substantial investments in our infrastructure,
our capital needs continue to expand. Accordingly, we may need to draw down additional borrowings under our credit facility or
access public or private debt or equity markets. There can be no assurance, however, that we will be successful in raising additional
debt or equity, or that we will be able to raise such funds on terms that we would consider acceptable.
An increase in the
level of indebtedness, if any, could, among other things:
·
make it difficult for us to obtain financing in the future for acquisitions, working capital, capital
expenditures, debt service requirements or other purposes;
·
limit our flexibility in planning for or reacting to changes in our business;
·
limit our ability to pay dividends;
·
make us more vulnerable in the event of a downturn in our business; and
18
·
affect certain financial covenants with which we must comply in connection with our credit facilities.
Additionally, any further
equity offering would dilute your ownership interest in our company.
Risk Factors Relating to Our Indebtedness
We have a substantial amount
of indebtedness, which may limit our operating flexibility and could adversely affect our results of operations and financial condition.
As of June 30, 2017,
we had approximately $5.8 million in borrowings outstanding under our $10 million credit facility (the "Credit Facility"),
which provides for up to $8 million in principal for revolving loans (the "Revolving Loans") for general working capital
purposes, up to $2 million in principal pursuant to a term loan (the "Term Loan") for the purpose of a permitted business
acquisition and up to $200,000 for letters of credit.
Our indebtedness could
have important consequences to our investors, including, but not limited to:
·
increasing our vulnerability to, and reducing our flexibility to respond to, general adverse economic
and industry conditions;
·
requiring the dedication of a substantial portion of our cash flow from operations to the payment
of principal of, and interest on, our indebtedness, thereby reducing the availability of such cash flow to fund working capital,
capital expenditures, acquisitions, joint ventures or other general corporate purposes;
·
limiting our flexibility in planning for, or reacting to, changes in our business, the competitive
environment and the industry in which we operate;
·
placing us at a competitive disadvantage as compared to our competitors that are not as highly
leveraged; and
·
limiting our ability to borrow additional funds and increasing the cost of any such borrowing.
A breach of a covenant
or restriction contained in our senior secured credit facility could result in a default that could in turn permit the affected
lender to accelerate the repayment of principal and accrued interest on our outstanding loans and terminate its commitments to
lend additional funds. If the lender under such indebtedness accelerates the repayment of our borrowings, we cannot assure you
that we will have sufficient assets to repay those borrowings as well as any other indebtedness.
Interest under the
Credit Facility is payable monthly in arrears and accrues as follows:
(a)
in the case of Revolving Loans, a rate per annum equal to the sum of (i) the Wall Street Journal
Prime Rate plus (ii) 2.00%;
(b)
in the case of the Term Loan, a rate per annum equal to the sum of (i) the Wall Street Journal
Prime Rate plus (ii) 3.75%; and
(c)
in the case of other obligations under the Credit Facility, a rate per annum equal to the sum of
(i) the greater of (A) 3.25% or (B) Wall Street Journal Prime Rate plus (ii) 3.75%.
The Credit Facility
also requires the payment of certain fees, including, but not limited to letter of credit fees and an unused Revolving Loans fee.
An increase in interest rates would adversely affect our profitability. To the extent that our access to credit is restricted because
of our own performance or conditions in the capital markets generally, our financial condition would be materially adversely affected.
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To date, we are not
in compliance with the financial covenants contained in the loan agreement with Sterling National Bank. W
e
received a waiver from Sterling National Bank for our non-compliance with the loan agreement for the quarters ended March 31, 2017
and June 30, 2017 in exchange for the payment of a fee of $5,000 for each quarterly waiver. We do not expect to be in compliance
with the terms of the loan agreement following the conclusion of the terms of the waivers granted by Sterling National Bank. We
are continuing to work with Sterling National Bank to address our on-going non-compliance. In the event Sterling National Bank
were to discontinue granting us waivers and call a default on the loan agreement, we would be forced to find another lender to
take its place and we would face greater short-term working capital constraints, which could adversely affect our operations and
our financial results.
In addition, we have
an outstanding aggregate of $1,250,000 in 8% Convertible Unsecured Promissory Notes (the "2017 Notes"), which were
issued to four accredited investors, including one of the Company's directors, Dhruwa N. Rai. The 2017 Notes bear interest
at 8% per annum until maturity in March 2020, with interest being paid annually on the first, second and third anniversaries of
the issuance of the 2017 Notes beginning in March 2018. From and after an event of default and for so long as the event of default
is continuing, the 2017 Notes will bear default interest at the rate of 10% per annum. The 2017 Notes can be prepaid by us at any
time without penalty.
The 2017 Notes are
convertible into shares of our common stock at a conversion price equal to $_____ (equal to 68% of the price per share of the common
stock sold in this offering). Upon the effectiveness of this registration statement, the holders of the 2017 Notes have the right,
at their option, at any time and from time to time to convert, in part or in whole, the outstanding principal amount and all accrued
and unpaid interest under the 2017 Notes into shares of the Company's common stock at the then applicable conversion price.
The 2017 Notes rank
junior to our secured credit facility with Sterling National Bank. The 2017 Notes also include certain negative covenants including,
without the investors' approval, restrictions on dividends and other restricted payments and reclassification of its stock.
Our level of indebtedness
may make it difficult to service our debt and may adversely affect our ability to obtain additional financing, use operating cash
flow in other areas of our business or otherwise adversely affect our operations.
Our Credit Facility contains
restrictive covenants that may impair our ability to conduct business.
The Credit Facility
contains a number of customary affirmative and negative covenants that, among other things, will limit or restrict our ability
to: incur additional indebtedness (including guaranty obligations); incur liens; engage in mergers, consolidations, liquidations
and dissolutions (other than pursuant to transactions approved by the lender); sell assets; pay dividends and make other payments
in respect of capital stock; make acquisitions, investments, loans and advances; pay and modify the terms of certain indebtedness;
engage in certain transactions with affiliates; enter into negative pledge clauses and clauses restricting subsidiary distributions;
and change its line of business, in each case, subject to certain limited exceptions. As a result of these covenants and restrictions,
we are limited in how we conduct our business and we may be unable to raise additional debt or other financing to compete effectively
or to take advantage of new business opportunities. The terms of any future indebtedness we may incur could include more restrictive
covenants. Failure to comply with such restrictive covenants may lead to default and acceleration under our Credit Facility and
may impair our ability to conduct business. We may not be able to maintain compliance with these covenants in the future and, if
we fail to do so, we may not be able to obtain waivers from the lenders and/or amend the covenants, which may adversely affect
our financial condition.
Upon the occurrence of an event
of default under our Credit Facility, our lender could elect to accelerate payments due and terminate all commitments to extend
further credit. Consequently, we may not have sufficient assets to repay the Credit Facility.
Upon the occurrence
of an event of default under our Credit Facility, the lender thereunder could elect to declare all amounts outstanding to be immediately
due and payable and terminate all commitments to extend further credit. If we were unable to repay those amounts, the lender under
the Credit Facility could proceed against the collateral granted to them to secure that indebtedness. The Company has pledged substantially
all of its assets as collateral under the Credit Facility. If the lender accelerates the repayment of borrowings, we cannot assure
you that we will have sufficient assets to repay the Credit Facility.
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Risks Relating to this Offering and our Common Stock
Purchasers in this offering
will experience immediate and substantial dilution in the book value of their investment.
The public offering
price of our common stock will be substantially higher than the net tangible book value per share of our common stock immediately
after this offering. Therefore, if you purchase our common stock in this offering, you will incur an immediate dilution of $___
(or __%) in net tangible book value per share from the price you paid, based on an assumed public offering price of $____ per share.
The exercise of outstanding warrants and options and the settlement of outstanding restricted stock units and conversion of the
2017 Notes may result in further dilution of your investment. In addition, if we raise funds by issuing additional shares or convertible
securities in the future, the newly issued shares may further dilute your ownership interest.
We may apply the proceeds of
this offering to uses that ultimately do not improve our operating results or increase the value of your investment.
We intend to use the
net proceeds from this offering to fund additional acquisition opportunities and for working capital and general corporate purposes.
Depending on several factors, including the availability of alternate sources of capital and the possibility that the execution
or timing of our business plans may change, management may use these proceeds in a manner different than originally intended. These
proceeds could be applied in ways that do not improve our operating results or otherwise increase the value of your investment.
There is a limited market for
our securities, which may make it more difficult to dispose of our securities and we may fail to qualify for listing on The Nasdaq
Capital Market, which could make it more difficult for investors to sell their shares.
Our common stock is
currently quoted on the OTCQB Marketplace. There is a limited trading market for our common stock. We have submitted an initial
listing application on The Nasdaq Capital Market in connection with this offering. Our initial listing application may not be granted,
as we may not meet the required listing criteria of The Nasdaq Capital Market. In the event the listing of our common stock is
approved by The Nasdaq Capital Market or other exchange, there can be no assurance that trading of our common stock on such market
will be sustained or desirable. In the event that our common stock fails to qualify for initial or continued listing, our common
stock could thereafter only be quoted on the OTC Bulletin Board or on what are commonly referred to as the "pink sheets"
operated by OTC Markets Group, Inc. Under such circumstances, you may find it more difficult to dispose of, or to obtain accurate
quotations, for our common stock, and our common stock would become substantially less attractive to certain purchasers, such as
financial institutions, hedge funds and other similar investors.
Our common stock may be affected
by limited trading volume and price fluctuations, each of which could adversely impact the value of our common stock.
There has been very
limited trading in our common stock and there can be no assurance that an active trading market in our common stock will either
develop or be maintained. Our common stock has experienced, and is likely to experience in the future, significant price and volume
fluctuations, which could adversely affect the market price of our common stock without regard to our operating performance. In
addition, we believe that factors such as quarterly fluctuations in our financial results and changes in the overall economy or
the condition of the financial markets could cause the price of our common stock to fluctuate substantially. These fluctuations
may also cause short sellers to enter the market from time to time in the belief that we will have poor results in the future.
We cannot predict the actions of market participants and, therefore, can offer no assurances that the market for our stock will
be stable or appreciate over time.
Our stock price may be volatile,
which could result in substantial losses for investors.
The market price of
our common stock may be volatile and could fluctuate widely in response to various factors, many of which are beyond our control,
including the following:
·
technological innovations or new products and services by us or our competitors;
21
·
additions or departures of key personnel;
·
sales of our common stock, including management shares;
·
limited availability of freely-tradable "unrestricted" shares of our common stock to
satisfy purchase orders and demand;
·
our ability to execute our business plan;
·
operating results that fall below expectations;
·
loss of any strategic relationship;
·
industry developments;
·
economic and other external factors;
·
our ability to manage the costs of maintaining adequate internal financial controls and procedures
in connection with the acquisition of additional businesses; and
·
period-to-period fluctuations in our financial results.
In addition, the securities
markets have from time to time experienced significant price and volume fluctuations that are unrelated to the operating performance
of particular companies. These market fluctuations may also significantly affect the market price of our common stock.
A significant number of our
shares will be eligible for sale and their sale or potential sale may depress the market price of our common stock.
Sales of a significant
number of shares of our common stock in the public market could harm the market price of our common stock. When this offering is
completed, we will have a total of _____ shares of common stock outstanding, assuming no exercise of the underwriters' over-allotment
option and no exercise of outstanding stock options and warrants, settlement of outstanding restricted stock units or conversion
of the 2017 Notes. The _________ shares offered by this prospectus, assuming no exercise of the underwriters' over-allotment
option, will be freely tradeable unless they are purchased by our "affiliates," as defined in Rule 144 under the Securities
Act of 1933, as amended (the "Securities Act"). An additional 1,987,342 shares are freely tradeable unless they are
purchased by our "affiliates," as defined in Rule 144 under the Securities Act of 1933, as amended. The remaining 12,632,675
shares outstanding are "restricted," which means they were originally sold in offerings, or issued as acquisition consideration,
that were not subject to a registration statement filed with the SEC. These restricted shares may be resold only through registration
under the Securities Act or under an available exemption from registration, such as provided through Rule 144.
In addition, 6,450,838
shares are issuable upon exercise of options and warrants, settlement of restricted stock units and conversion of the 2017 Notes.
Pursuant to an effective registration statement, 2,666,666 shares issuable upon exercise of outstanding warrants are freely tradeable
unless they are purchased by our "affiliates," as defined in Rule 144 under the Securities Act. If any options are
exercised, restricted stock units are settled or the 2017 Notes are converted, the shares issued upon such exercise, settlement
or conversion (as applicable) will also be restricted, but may be sold under Rule 144 after the shares have been held for six months.
Sales under Rule 144 may be subject to volume limitations and other conditions.
In addition to the
possibility that actual sales of significant amounts of our common stock in the public market could harm our common stock price,
the fact that our stockholders have the ability to make such sales could create a circumstance commonly referred to as an "overhang,"
in anticipation of which the market price of our common stock could fall. The existence of an overhang, whether or not sales have
occurred or are occurring, could also make it more difficult for us to raise additional financing through the sale of equity or
equity-related securities in the future at a time and price that we deem reasonable or appropriate.
We do not expect to pay dividends
in the future. As a result, any return on investment may be limited to the value of our common stock.
We have never paid
cash dividends on our common stock and do not anticipate paying cash dividends on our common stock in the foreseeable future. The
payment of dividends on our common stock will depend on our earnings, financial condition and other business and economic factors
as our board of directors may consider relevant. In addition, no dividends will be declared or paid or set apart for payment on
our common stock unless all accumulated accrued and unpaid dividends in respect of our Series A Preferred Stock are contemporaneously
declared and paid in cash or declared and a sum of cash sufficient for the payment thereof set apart for such payment on the Series
A Preferred Stock for all past dividend periods with respect to which full dividends were not paid on the Series A Preferred Stock
in cash. If we do not pay dividends, our common stock may be less valuable because a return on your investment will only occur
if our stock price appreciates.
22
The terms of our
financing agreements may limit our ability to pay dividends on the Series A Preferred Stock.
Financing agreements,
whether ours or those of our subsidiaries and whether in place now or in the future may include restrictions on our ability to
pay cash dividends on our capital stock, including the Series A Preferred Stock. These limitations may cause us to be unable to
pay dividends on the Series A Preferred Stock unless we can refinance amounts outstanding under those agreements. We do not intend
to pay cash dividends to the extent we are restricted by any of our financing arrangements.
We currently have Series A Preferred
Stock outstanding and our certificate of incorporation authorizes our board of directors to create new series of preferred stock
without further approval by our stockholders, which could adversely affect the rights of the holders of our common stock.
Our board of directors
has the authority to fix and determine the relative rights and preferences of preferred stock. Our board of directors also has
the authority to issue preferred stock without further stockholder approval. We currently have outstanding Series A Preferred Stock
which gives its holders the preferred right to our assets upon liquidation, the right to receive dividend payments before dividends
are distributed to the holders of common stock and the right to the redemption of the shares, together with a premium, prior to
the redemption of our common stock. In addition, our board of directors could authorize the issuance of additional series of preferred
stock with such rights preferential to the rights of our common stock, including the issuance of a series of preferred stock that
has greater voting power than our common stock or that is convertible into our common stock, which could decrease the relative
voting power of our common stock or result in dilution to our existing stockholders.
Because certain of our stockholders
control a significant number of shares of our common stock, they may have effective control over actions requiring stockholder
approval.
Our directors, executive
officers and principal stockholders, and their respective affiliates, beneficially own approximately 81.29% of our outstanding
shares of common stock before giving effect to the sale of our common stock pursuant to this offering. Accordingly, our executive
officers, directors and principal stockholders, and their respective affiliates, will have significant influence on the ability
to control the Company and the outcome of issues submitted to our stockholders.
If securities or industry analysts
do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could
decline.
The trading market
for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our
business. We do not currently have research coverage by securities and industry analysts and you should not invest in our common
stock in anticipation that we will obtain such coverage. If we obtain securities or industry analyst coverage and if one or more
of the analysts who covers us downgrades our stock or publishes inaccurate or unfavorable research about our business, our stock
price would likely decline. If one or more of these analysts ceases coverage of us or fails to publish reports on us regularly,
demand for our stock could decrease, which could cause our stock price and trading volume to decline.
If the benefits of any proposed
acquisition of do not meet the expectations of investors, stockholders or financial analysts, the market price of our common stock
may decline.
If the benefits of
any proposed acquisition of do not meet the expectations of investors or securities analysts, the market price of our common stock
prior to the closing of the proposed acquisition may decline. The market values of our common stock at the time of the proposed
acquisition may vary significantly from their prices on the date the acquisition target was identified.
23
In addition, broad
market and industry factors may materially harm the market price of our common stock irrespective of our operating performance.
The stock market in general has experienced price and volume fluctuations that have often been unrelated or disproportionate to
the operating performance of the particular companies affected. The trading prices and valuations of these stocks, and of our securities,
may not be predictable. A loss of investor confidence in the market for retail stocks or the stocks of other companies which investors
perceive to be similar to us could depress our stock price regardless of our business, prospects, financial conditions or results
of operations. A decline in the market price of our securities also could adversely affect our ability to issue additional securities
and our ability to obtain additional financing in the future.
Changes in accounting principles
and guidance, or their interpretation, could result in unfavorable accounting charges or effects, including changes to our previously
filed financial statements, which could cause our stock price to decline.
We prepare our consolidated
financial statements in accordance with GAAP. These principles are subject to interpretation by the SEC and various bodies formed
to interpret and create appropriate accounting principles and guidance. A change in these principles or guidance, or in their
interpretations, may have a significant effect on our reported results and retroactively affect previously reported results.
Being a public company results
in additional expenses, diverts management's attention and could also adversely affect our ability to attract and retain
qualified directors.
As a public reporting
company, we are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act").
These requirements generate significant accounting, legal and financial compliance costs and make some activities more difficult,
time consuming or costly and may place significant strain on our personnel and resources. The Exchange Act requires, among other
things, that we maintain effective disclosure controls and procedures and internal control over financial reporting. In order to
establish the requisite disclosure controls and procedures and internal control over financial reporting, significant resources
and management oversight are required.
As a result, management's
attention may be diverted from other business concerns, which could have an adverse and even material effect on our business, financial
condition and results of operations. These rules and regulations may also make it more difficult and expensive for us to obtain
director and officer liability insurance. If we are unable to obtain appropriate director and officer insurance, our ability
to recruit and retain qualified officers and directors, especially those directors who may be deemed independent, could be adversely
impacted.
We are an "emerging growth
company" and our election to delay adoption of new or revised accounting standards applicable to public companies may result
in our financial statements not being comparable to those of some other public companies. As a result of this and other reduced
disclosure requirements applicable to emerging growth companies, our securities may be less attractive to investors.
As a public reporting
company with less than $1,070,000,000 in revenue during our last fiscal year, we qualify as an "emerging growth company"
under the Jumpstart our Business Startups Act of 2012 (the "JOBS Act"). An emerging growth company may take advantage
of certain reduced reporting requirements and is relieved of certain other significant requirements that are otherwise generally
applicable to public companies. In particular, as an emerging growth company we:
·
are not required to obtain an attestation and report from our auditors on our management's
assessment of our internal control over financial reporting pursuant to the Sarbanes-Oxley Act of 2002;
·
are not required to provide a detailed narrative disclosure discussing our compensation principles,
objectives and elements and analyzing how those elements fit with our principles and objectives (commonly referred to as "compensation
discussion and analysis");
24
·
are not required to obtain a non-binding advisory vote from our stockholders on executive compensation
or golden parachute arrangements (commonly referred to as the "say-on-pay," "say-on-frequency" and "say-on-golden-parachute"
votes);
·
are exempt from certain executive compensation disclosure provisions requiring a pay-for-performance
graph and CEO pay ratio disclosure;
·
may present only two years of audited financial statements and only two years of related Management's
Discussion & Analysis of Financial Condition and Results of Operations ("MD&A"); and
·
are eligible to claim longer phase-in periods for the adoption of new or revised financial accounting
standards under §107 of the JOBS Act.
We intend to take advantage
of all of these reduced reporting requirements and exemptions, including the longer phase-in periods for the adoption of new or
revised financial accounting standards under §107 of the JOBS Act. Our election to use the phase-in periods may make it difficult
to compare our financial statements to those of non-emerging growth companies and other emerging growth companies that have opted
out of the phase-in periods under §107 of the JOBS Act.
Certain of these reduced
reporting requirements and exemptions were already available to us due to the fact that we also qualify as a "smaller reporting
company" under SEC rules. For instance, smaller reporting companies are not required to obtain an auditor attestation and
report regarding management's assessment of internal control over financial reporting; are not required to provide a compensation
discussion and analysis; are not required to provide a pay-for-performance graph or Chief Executive Officer pay ratio disclosure;
and may present only two years of audited financial statements and related MD&A disclosure.
Under the JOBS Act,
we may take advantage of the above-described reduced reporting requirements and exemptions for up to five years after our initial
sale of common equity pursuant to a registration statement declared effective under the Securities Act of 1933, as amended (the
"Securities Act"), or such earlier time that we no longer meet the definition of an emerging growth company. In this
regard, the JOBS Act provides that we would cease to be an "emerging growth company" if we have more than $1,070,000,000
in annual revenues, have more than $700 million in market value of our common stock held by non-affiliates, or issue more than
$1.0 billion in principal amount of non-convertible debt over a three-year period. Further, under current SEC rules we will continue
to qualify as a "smaller reporting company" for so long as we have a public float (i.e., the market value of common
equity held by non-affiliates) of less than $75 million as of the last business day of our most recently completed second fiscal
quarter.
We cannot predict if
investors will find our securities less attractive due to our reliance on these exemptions.
Failure to establish and maintain
effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on our
business and stock price.
We are required to
comply with the SEC's rules implementing Sections 302 and 404 of the Sarbanes-Oxley Act, which require management to certify
financial and other information in our quarterly and annual reports and provide an annual management report on the effectiveness
of controls over financial reporting. Though we are required to disclose changes made in our internal controls and procedures on
a quarterly basis, we will not be required to make our first annual assessment of our internal control over financial reporting
pursuant to Section 404 until year-end 2017. However, as an emerging growth company, our independent registered public accounting
firm will not be required to formally attest to the effectiveness of our internal control over financial reporting pursuant to
Section 404 until the end of the fiscal year for which our second annual report is due or the date we are no longer an emerging
growth company. At such time, our independent registered public accounting firm may issue a report that is adverse in the event
it is not satisfied with the level at which our controls are documented, designed or operating.
25
To comply with the
requirements of being a public company, we have undertaken various actions, and may need to take additional actions, such as implementing
new internal controls and procedures and hiring additional accounting or internal audit staff. Testing and maintaining internal
control can divert our management's attention from other matters that are important to the operation of our business. Additionally,
when evaluating our internal control over financial reporting, we may identify material weaknesses that we may not be able to remediate
in time to meet the applicable deadline imposed upon us for compliance with the requirements of Section 404. If we identify any
material weaknesses in our internal control over financial reporting or are unable to comply with the requirements of Section 404
in a timely manner or assert that our internal control over financial reporting is effective, or if our independent registered
public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting
once we are no longer an emerging growth company, investors may lose confidence in the accuracy and completeness of our financial
reports and the market price of our common stock could be negatively affected, and we could become subject to investigations by
the Financial Industry Regulatory Agency, the SEC or other regulatory authorities, which could require additional financial and
management resources.
Anti-takeover provisions contained
in our certificate of incorporation and bylaws, as well as provisions of Delaware law, could impair a takeover attempt.
The Company's
certificate of incorporation and bylaws contain provisions that could have the effect of delaying or preventing changes in control
or changes in our management without the consent of our board of directors. These provisions include:
·
no cumulative voting in the election of directors, which limits the ability of minority stockholders
to elect director candidates;
·
the exclusive right of our board of directors to elect a director to fill a vacancy created by
the expansion of the board of directors or the resignation, death, or removal of a director, which prevents stockholders from being
able to fill vacancies on our board of directors;
·
the ability of our board of directors to determine whether to issue shares of our preferred stock
and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval,
which could be used to significantly dilute the ownership of a hostile acquirer;
·
limiting the liability of, and providing indemnification to, our directors and officers;
·
controlling the procedures for the conduct and scheduling of stockholder meetings;
·
providing that directors may be removed prior to the expiration of their terms by stockholders
only for cause; and
·
advance notice procedures that stockholders must comply with in order to nominate candidates to
our board of directors or to propose matters to be acted upon at a stockholders' meeting, which may discourage or deter a
potential acquirer from conducting a solicitation of proxies to elect the acquirer's own slate of directors or otherwise
attempting to obtain control of the Company.
These provisions, alone
or together, could delay hostile takeovers and changes in control of the Company or changes in our board of directors and management.
Any provision of our
certificate of incorporation or bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit
the opportunity for our security holders to receive a premium for their securities and could also affect the price that some investors
are willing to pay for our securities.
26
Cautionary
Note Regarding Forward-Looking Statements
This prospectus contains
forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation
Reform Act of 1995. Specifically, forward-looking statements may include statements relating to:
·
our future financial performance;
·
changes in the market for our products;
·
our expansion plans and opportunities; and
·
other statements preceded by, followed by or that include the words "estimate," "plan,"
"project," "forecast," "intend," "expect," "anticipate," "believe,"
"seek," "target" or similar expressions.
These forward-looking
statements are based on information available as of the date of this prospectus and current expectations, forecasts and assumptions,
and involve a number of judgments, risks and uncertainties. Accordingly, forward-looking statements should not be relied upon as
representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to
reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise,
except as may be required under applicable securities laws.
As a result of a number
of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed
or implied by these forward-looking statements. Some factors that could cause actual results to differ include:
·
the level of demand for our products;
·
competition in our markets;
·
our ability to grow and manage growth profitably;
·
our ability to access additional capital;
·
changes in applicable laws or regulations;
·
our ability to attract and retain qualified personnel;
·
the possibility that we may be adversely affected by other economic, business, and/or competitive
factors; and
·
other risks and uncertainties indicated in this prospectus, including those under "Risk Factors."
27
Use
of Proceeds
We estimate the net
proceeds to us from the sale of the common stock in this offering will be approximately $___________, or approximately $__________
if the underwriters' over-allotment option is exercised in full, based on an assumed public offering price of $______ per
share and after deducting the underwriting discount and our estimated offering expenses.
We intend to use the
net proceeds from this offering for the following purposes and in the following order of priority:
Purpose
Estimated
Amount
Estimated
Percentage of Net Proceeds
Funding of potential acquisitions
$
%
Working capital and general corporate purposes
$
%
Total
$
100.0
%
We plan to use a significant
portion of the net proceeds of this offering to finance acquisitions of, or investments in, competitive and complementary businesses
as a part of our growth strategy. We currently have no commitments in place with respect to any such acquisitions or investments.
Working capital and
general corporate purposes include amounts required to pay for research & development expenses, salaries, professional fees,
public reporting costs, office-related expenses and other corporate expenses, including interest and overhead.
Investors are cautioned
that expenditures may vary substantially from the estimates above. Investors will be relying on the judgment of our management,
who will have broad discretion regarding the application of the proceeds of this offering. The amounts and timing of our actual
expenditures will depend upon numerous factors, including our potential investments in new businesses, the amount of cash generated
by our operations, the amount of competition we face and other operational factors. We may find it necessary or advisable to use
portions of the proceeds from this offering for other purposes. From time to time, we evaluate these and other factors and we anticipate
continuing to make such evaluations to determine if the existing allocation of resources, including the proceeds of this offering,
is being optimized. Circumstances that may give rise to a change in the use of proceeds include:
·
our ability to negotiate definitive agreements with acquisition candidates;
·
the availability and terms of debt financing to fund a portion of the purchase price(s) for potential
acquisitions;
·
the need or desire on our part to accelerate, increase or eliminate existing initiatives due to,
among other things, changing market conditions and competitive developments; and
·
the availability of other sources of cash including cash flow from operations and new bank debt
financing arrangements, if any.
Pending the use of
net proceeds of this offering, we intend to invest most of the net proceeds from this offering in short-term, investment-grade,
interest-bearing securities.
28
Dividend
Policy
The Company has not
paid any dividends on its common stock to date. It is the present intention of the Company to retain any earnings for use in its
business operations and, accordingly, the Company does not anticipate the board of directors declaring any dividends in the foreseeable
future on its common stock. In addition, certain of our loan agreements restrict the payment of dividends and the terms of the
Company's Series A Preferred Stock may from time to time prevent it from paying cash dividends on its common stock.
Capitalization
The following table
summarizes our cash and cash equivalents and capitalization as of June 30, 2017:
·
on an actual basis; and
·
on an as adjusted basis, giving effect to our receipt of the net proceeds from the sale by us in
this offering of shares of common stock at an assumed public offering price of $___ per share, after deducting estimated underwriting
discounts and commissions and estimated offering expenses payable by us.
As of June 30, 2017
Actual
As Adjusted
(in thousands, except per share amounts)
Cash and cash equivalents
$
1,041
$
Short-term debt, including current portion of long-term debt
$
4,511
Long-term debt, less current portion
1,334
Stockholders' equity:
Preferred stock, par value $0.01; 1,000,000 shares authorized, 373,708 shares issued and outstanding, actual; 1,000,000 authorized, 373,708 shares issued and outstanding, as adjusted
4
Common stock; par value $0.01; 100,000,000 shares authorized, 14,650,412 shares issued and outstanding, actual; 100,000,000 shares authorized, _______ shares issued and outstanding, as adjusted
(1)
147
Additional paid-in capital
22,290
Accumulated deficit
(8,828
)
Accumulated other comprehensive income (loss)
(4
)
)
Non-controlling interest
(12
)
Total stockholders' equity
13,620
Total capitalization
$
47,293
$
(1)
The number of shares issued and outstanding and the additional paid-in capital exclude (a) 1,690,358
shares of common stock reserved for issuance upon the exercise of stock options and the settlement of restricted stock units outstanding
under our 2015 Equity Incentive Award Plan, (b) 2,666,666 shares of common stock reserved for issuance upon the exercise of outstanding
warrants (for which cash would need to be remitted to us for exercise), and (c) shares of common stock reserved for issuance under
the underwriters' over-allotment option.
29
Price
Range of Common Stock
The Company's
common stock is currently quoted on the OTCQB Marketplace under the symbol "AMRH". Prior to May 26, 2015, when we completed
a reverse merger and changed our corporate name from Spatializer Audio Laboratories, Inc., our trading symbol was SPZR. We have
applied to list our common stock on The Nasdaq Capital Market, and expect such listing to occur concurrently with this offering.
The following table
sets forth for the periods indicated, the reported high and low closing prices per share for our common stock.
Period
High
Low
2016:
First Quarter
$
7.00
$
5.00
Second Quarter
$
7.00
$
5.50
Third Quarter
$
7.00
$
5.00
Fourth Quarter
$
7.50
$
5.00
2017:
First Quarter
$
6.55
$
6.51
Second Quarter
$
9.00
$
6.51
Third Quarter (through September __, 2017)
$
9.00
$
6.50
On September __, 2017,
the closing price of our common stock was $___. As of September __, 2017, there were 14,650,412 shares of common stock outstanding,
held of record by 534 holders.
30
Dilution
If you invest in our
securities, your interest will be immediately and substantially diluted to the extent of the difference between the public offering
price per share of our common stock and the pro forma net tangible book value per share of our common stock after giving effect
to this offering.
Our net tangible book
value as of June 30, 2017 was $13,619,866 or $1.01 per share of common stock, based upon 14,650,412 shares outstanding. After giving
effect to the sale of the shares in this offering at the assumed public offering price of $___ per share, at June 30, 2017, after
deducting underwriting discounts and commissions and other estimated offering expenses payable by us, our as adjusted net tangible
book value at June 30, 2017 would have been approximately $______, or $___ per share. This represents an immediate increase in
as adjusted net tangible book value of approximately $___ per share to our existing stockholders, and an immediate dilution of
$___ per share to investors purchasing shares in the offering.
Dilution in as adjusted
net tangible book value per share represents the difference between the amount per share paid by purchasers of our common stock
in this offering and the as adjusted net tangible book value per share of our common stock immediately after this offering.
The following table
illustrates the per share dilution to investors purchasing securities in the offering:
Assumed public offering price per share
$
Net tangible book value per share as of June 30, 2017
$
1.01
Increase in net tangible book value per share attributable to this offering
$
As adjusted net tangible book value per share after this offering
$
Dilution in pro forma net tangible book value per share to new investors
$
The information above
assumes that the underwriters do not exercise their over-allotment option. If the underwriters exercise their over-allotment option
in full, the as adjusted net tangible book value will increase to $__ per share, representing an immediate increase to existing
stockholders of $___ per share and an immediate dilution of $___ per share to new investors. If any shares are issued upon exercise
of outstanding options or warrants, new investors will experience further dilution.
Investors in this offering
will be subject to increased dilution upon the exercise of outstanding stock options, settlement of restricted stock units and
the exercise of warrants. As of Septemnber ___, 2017, these stock options, restricted stock units and warrants represent an additional
6,074,494 shares that could be issued in the future. In addition, conversion of the 2017 Notes and the issuance of shares of our
common stock pursuant to our acquisition agreements will result in further dilution of your investment.
31
Description
of Business
Our Company
We specialize in delivering
SAP cloud, digital and enterprise services to clients worldwide.
SAP is a leader in
providing enterprise resource planning ("ERP") software and technologies to enterprise customers worldwide. We deliver
a wide range of solutions and services across multiple domains and industries. Our services include strategic consulting, operational
leadership, digital transformation services, robotics process automation and co-creation of customized solutions, including those
in mobility, sustainability, big data and cloud computing.
Our SAP focus allows
us to provide technological solutions to a broad and growing base of clients. We are headquartered in Princeton, NJ, and have offices
across the United States, which are supported by delivery centers in India. Our model inverts the conventional global delivery
model wherein offshore information technology ("IT") service providers are based abroad and maintain a minimal presence
in the United States. With a strong SAP focus, our client partnerships anchor around SAP cloud services, artificial intelligence,
internet of things and robotic process automation. We pursue an acquisition strategy that seeks to disrupt the established business
model of offshore IT service providers.
With our innovative
solutions in enterprise architecture, ERP, predictive analytics and enterprise mobility, we provide companies worldwide with strategic
insights into their business which lead to a positive impact on their performance and profitability. In 2017, we signed a strategic
partnership agreement with NEC America to offer SAP HANA (a next generation enterprise database system) migration services. This
partnership will allow us to offer our clients a broader spectrum of services.
Our primary business
objective is to provide our clients with a competitive advantage by enhancing their business capabilities and technologies with
our expanding consulting services portfolio, which is aided by our business acquisitions. Our strategic acquisitions allow us to
bring global service delivery, SAP S/4 HANA and high-end SAP consulting capabilities to a broader geographic market and customer
base. We continue to leverage our growing geographical footprint and technical expertise to simultaneously expand our service and
product offering. With each acquisition, we identify business synergies that will allow us to bring new services and products from
one subsidiary to customers at our other subsidiaries. While we generate revenues from the consulting businesses of each of our
acquired subsidiaries, we believe that additional revenues will be generated through new business relationships and services developed
through our business combinations.
Background
We were incorporated
under the laws of the State of Delaware in February 1994 as Spatializer Audio Laboratories, Inc., which was a shell company immediately
prior to our completion of a "reverse merger" transaction on May 26, 2015,
in
which we caused Ameri100 Acquisition, Inc., a Delaware corporation and our newly created, wholly owned subsidiary, to be merged
with and into Ameri and Partners, a Delaware corporation. As a result of the Merger, Ameri and Partners became our wholly owned
subsidiary with Ameri and Partners' former stockholders acquiring a majority of the outstanding shares of our
common
stock
. The Merger was consummated under Delaware law, pursuant to the Merger Agreement,
and in connection with the Merger we changed our name to AMERI Holdings, Inc. and do business under the brand name "Ameri100".
As
part of the Merger, we purchased 24.9% of the outstanding shares of common stock of
Ameri Consulting Service Private Ltd.
("
Ameri India"), a corporation organized under the laws of India which was owned
by Srinidhi "Dev" Devanur, our Executive Vice Chairman, for aggregate consideration consisting of $1.00 and the consideration
being furnished by us to the stockholders of Ameri and Partners under the Merger Agreement, pursuant to the terms of a Stock Purchase
Agreement, dated as of May 26, 2015, by and between us and Mr. Devanur. Subject to obtaining various regulatory approvals for foreign
ownership required under India's Foreign Exchange Management Act, we agreed to purchase the remaining 75.1% of the outstanding
shares of Ameri India (with the exception of one share of Ameri India that was retained by Mr. Devanur as a nominee holder for
the Company due to a requirement of Indian law for a corporation to have a minimum of two shareholders) for similar consideration,
which transaction was completed in 2016.
32
Concurrently
with the closing of the Merger, we issued
a 5% Unsecured Convertible Note due May 26, 2017, in the principal amount of $5,000,000
(the "Convertible Note") bearing interest at 5% per annum, maturing on May 26, 2017 and at a conversion price of $1.80
per share, or an aggregate of 2,777,778 shares of common stock, together with a warrant to purchase shares of our common stock
(the "Original Warrant") to purchase up to 2,777,777 shares of our common stock, at an exercise price equal to $1.80
per share, in a private placement (the "Private Placement") to Lone Star Value Investors, LP ("LSVI"),
pursuant to the terms of a Securities Purchase Agreement
, dated as of May 26, 2015. Prior
to the Merger, LSVI was our majority shareholder.
On May 13, 2016, LSVI
completed an early partial exercise of an Original Warrant for 1,111,111 shares the Company's common stock at a price of
$1.80 per share, for total consideration to the Company of $2,000,000, and LSVI was issued a replacement warrant for the remaining
1,166,666 shares under the Original Warrant on the same terms as the Original Warrant. LSVI also agreed to an amendment of the
Convertible Note, to extend the maturity of the Convertible Note for two years in exchange for (i) the right to request that the
Board of Directors of the Company (the "Board") expand the size of the Board to nine directors from the current eight,
with LSVI having the right to designate up to four of the nine directors, and (ii) the issuance of an additional warrant (the "Additional
Warrant") for the purchase of 1,000,000 shares of the Company's common stock at a price of $6.00 per share, on substantively
the same terms as the Original Warrant. LSVI's Registration Rights Agreement, dated May 26, 2015, with us was also amended
and restated to include the shares of common stock issuable under the Additional Warrant.
On December 30, 2016,
the Company entered into an Exchange Agreement (the "Exchange Agreement") with LSVI, pursuant to which the Convertible
Note was returned to the Company and cancelled in exchange for 363,611 shares of the Company's Series A Preferred Stock,
which is non-convertible and perpetual preferred stock of the Company. As a result of the exchange transaction, no principal or
interest remained outstanding or payable under the Convertible Note and the Convertible Note was no longer convertible into shares
of common stock of the Company.
Our Industry
Background
We operate in an intensely
competitive IT outsourcing services industry, which competes on quality, service and costs. Most offshore IT services providers
have undertaken a "forward integration" to boost their capabilities and presence in their client geographies (large
offshore presence with a small local presence). Large U.S. players on the other hand focus on "backward integration"
to scale and boost their offshore narrative (offshore being the "back office" for the local operations). Today the
IT services industry is marked by the following characteristics:
Characteristic
Description
Mature Market
●
Most large global companies have
already outsourced what they wanted to outsource.
Commoditized Business Model
●
North America and Europe continue to be the markets with attractive spending potential. However, increased regulations and visa dependencies prove to be a major drawback of the model.
●
The benefits realized from the business model are largely based on labor arbitrage, productivity benefits and portfolio restructuring. These contours have changed due to commoditization.
Insourcing
●
Extremely rapid changes in technology are forcing IT services–traditionally an outsourcing business—to adopt an insourcing model.
33
Rapid Technology Shifts
●
Cloud services, robotic process automation, artificial intelligence and internet of things are increasingly in demand as part of outsourcing engagements. Smart robots increasingly operate in the cloud, and a 'labor-as-a-service' approach has emerged, as clients and providers find that intelligent tools and virtual agents can be easily and flexibly hosted on cloud platforms.
●
Social media, cloud computing, mobility and big data will continue to be mainstays for any IT ecosystem.
●
The convergence of cloud computing, virtualization (applications and infrastructure) and utility computing is around the corner. The ability of a vendor to offer an integrated basket of services on a SaaS model, will be a key differentiator.
●
Enterprises are becoming more digital. There is a strong convergence of human and machine intelligence thanks to drivers like advanced sensors and machine learning. Operations and technology are converging.
Contracts & Decision Making
●
Large multi-year contracts will be renegotiated and broken down into shorter duration contracts and will involve multiple vendors rather than sole sourcing.
●
The ability to demonstrate value through Proof of Concepts (POCs) and willingness to offer outcome based pricing are becoming critical considerations for decision making. Requests for Proposal (RFP)-driven decisions are increasingly rare.
The SAP Industry
SAP as an ERP product
has become an industry by itself. The core SAP enterprise offering has been reinforced with cloud-based products that make the
entire SAP ecosystem extremely attractive from our perspective due to the following attributes:
·
The alignment of SAP to enterprises is extremely strong. Given the reliance of enterprises on applications,
clients tend to make long-term bets on SAP as an enterprise solution.
·
According to the September 2014 "HfS Blueprint Report" by HfS Research Ltd., the SAP
market is a multi-billion-dollar market that is very fragmented (there are over 5,000 consulting firms), with the three largest
service providers capturing an increasing share of the market.
·
A significant number of SAP customers must move to S/4 HANA by 2025.
Our Approach
Our solutions deliver
significant business efficiency outcomes through turnkey projects, consulting and global delivery centers. We have adopted a "strategic
acquisition model", pursuant to which we acquire companies that support our goals. These businesses are realigned as
parts of a viable and profitable operating model. We believe that our strategic service portfolio, deep industry experience and
strong global talent pool offer a compelling proposition to clients. In 2016, we acquired three companies: Virtuoso and
Ameri Arizona in the U.S., and Bigtech Software Pvt. Ltd. in India. These strategic acquisitions have brought global delivery presence,
SAP S/4 HANA and high-end SAP consulting capabilities to our service portfolio. In 2017, we signed a strategic partnership agreement
with NEC America to offer SAP HANA (a next generation enterprise database system) migration services. This partnership enables
us to offer our clients a broader spectrum of services.
Our Portfolio of Service Offerings
Our portfolio of service
offerings expanded significantly in 2016 with our acquisitions of Ameri Georgia, Ameri Arizona, Virtuoso and Bigtech. We anticipate
our future service offerings to evolve as we continue to pursue our acquisitive growth strategy.
34
Our current portfolio
of services is divided into three categories:
Cloud Services
An increasing trend
in the IT services market is the adoption of cloud services. Historically clients have resorted to on-premise software solutions,
which required capital investments in infrastructure and data centers. Cloud services enable clients to build and host their applications
at much lower costs. Our product offerings leverage the low cost and flexibility of cloud computing.
We have expertise in
deploying SAP's public, private and hybrid cloud services, as well as SAP HANA cloud migration services. Our teams are experienced
in the rapid delivery of cloud services. We perform SAP application and cloud support and SAP cloud development. Additionally,
we provide cloud automation solutions that focus on business objectives and organizational growth. We believe that our strategic
partnership with NEC will enable us to offer an attractive HANA migration service to our clients.
Digital Services
We have developed several
mobile solutions, including Simple Advance Planning and Optimization ("APO"), the IBP/ Sales and Operations Planning
("S&OP") Mobile Analytics App and the Langer Index.
The SimpleAPO mobile
application (app) provides sales professionals with real-time collaboration capabilities and customer data, on their mobile devices.
It increases the efficiency of the sales process and the accuracy of customer needs forecasting.
The SAP IBP mobile
app enables the real-time management and analysis of S&OP related data from mobile devices. SAP is an implementation partner
for this app. SAP has recognized the app's value to the ecosystem (S&OP apps being complex and difficult to design).
The Langer Index is
a mobile-supported, web-based assessment system for collecting and analyzing IT organizational effectiveness. Most customers do
not have measurement metrics to assess if their IT spend is yielding value. A firm's IT organization could be transactional,
transitional or transformational depending on its investment in technology, processes and personnel. The Langer Index gives us
a novel tool to measure IT maturity and focus and to help our clients ensure that their IT dollars are creating maximal value.
Enterprise Services
We design, implement
and manage Business Intelligence ("BI") and analytics solutions. BI helps our clients navigate the market better by
identifying new trends and by targeting top-selling products. We also enable clients to use BI for generating instant financial
reports and analytics of customer, product and cost information over time. In addition, we provide solutions for metadata
repository, master data management and data quality. Finally, we determine BI demands across various platforms.
Other key enterprise
services that we offer include consulting services for global and regional SAP implementations, SAP/IT solution advisory and architectural
services, project management services, IT/ERP strategy and vendor selection services. Often clients have relied on us to deliver
services in non-SAP packages, as well. We bring deep expertise in products by companies such as Oracle, JD Edwards, PeopleSoft,
MicroStrategy, Hyperion, Siebel and webMethods.
In addition, the broad
range of experiences of our consultants is brought together to create "knowledge products" in SAP, and to deliver training
programs on a customized basis for our clients. Thus, we are able to scale competencies within a client's organization by
leveraging our consultant's expertise.
35
Our Growth Strategy
Our growth strategy
is based on customer-driven business expansion and strategic acquisitions of SAP services companies. We introduce specific key
account management strategies to grow organically by cross selling and upselling different services across business units. It is
our goal to be a leader in the SAP cloud, digital and enterprise services market. We use strategic acquisitions, alliances and
partnerships to achieve this goal.
We have complementary
near-and longer-term strategies. In the short-term, we continue to focus on high-end consulting and solutions in the SAP space.
Our medium-term focus will be to make an entry into cloud engagements and HANA. Signing up with NEC as a strategic partner for
the SAP HANA migration was a critical step to achieving this objective. Additionally, we will gain market share in high-growth
areas in the SAP ecosystem such as Hybris, Success Factors and BI/BW/SAP HANA. In the long-term, we will identify and acquire firms
in the areas of Artificial Intelligence (AI) and robotics to bolster our AIR (AI + internet of things + robotics) practice. We
believe that during each phase of our growth strategy, business and market conditions will require our plans to evolve
or change, and we plan to be agile in addressing both opportunities and exigencies.
The integration of
each of our acquisitions into our business enterprise requires establishing our company's standard operating procedures at
each acquired entity, seamlessly transitioning each acquired entity's branding to the "Ameri100" brand and assessing
any necessity to transition account management. The integration process also requires us to evaluate any product-line expansions
made possible by the acquired entity and how to bring new product lines to the broader customer base of the entire Company. With
the integration of each acquisition, we face challenges of maintaining cross-company visibility and cooperation, creating a cohesive
corporate culture, handling unexpected customer reactions and changes and aligning the interests of the acquired entity's
leadership with the interests of the Company. To date, these challenges have been manageable, and we are becoming more adept at
managing integration issues with each new acquisition.
Sales and Marketing
We combine traditional
sales with our strength in industries and technology. Our sales function is composed of direct sales and inside sales professionals.
Both work closely with our solutions directors to identify potential opportunities within each account. We currently have
85 active clients and 200 dormant accounts. Using a consultative selling methodology (working with clients to prescribe a solution
that suits their needs in terms of efficiency, cost and timelines), we identify target prospects and develop a pursuit plan for
each key account. We utilize a blended sales model that combines consultative selling with traditional sales methods. Once the
customer has engaged us, the sales, solutions and marketing teams monitor and manage the relationship with the help of customer
relationship management software.
The marketing group
is tasked with building a strong, sustainable brand image for our company, positioning us in the SAP arena and facilitating business
opportunities. Marketing functions include webinars, targeted email campaigns and social media vehicles including blogs, networking
efforts and video sharing websites. Data gathered from these activities helps us to measure and track our market position
and customer understanding of our offerings.
Revenues and Customers
We generate revenue
primarily through consulting services performed in the fulfillment of written service contracts. The service contracts we enter
into generally fall into two categories: (1) time-and-materials contracts and (2) fixed-price contracts.
When a customer enters
into a time-and-materials or fixed-price, (or a periodic retainer-based) contract, we recognize revenue in accordance with an evaluation
of the deliverables in each contract. If the deliverables represent separate units of accounting, we then measure and allocate
the consideration from the arrangement to the separate units, based on vendor-specific objective evidence of the value for each
deliverable.
The revenue under time-and-materials
contracts is recognized as services are rendered and performed at contractually agreed upon rates. Revenue pursuant to fixed-price
contracts is recognized under the proportional performance method of accounting. We routinely evaluate whether revenue and profitability
should be recognized in the current period. We estimate the proportional performance on our fixed-price contracts on a monthly
basis utilizing hours incurred to date as a percentage of total estimated hours to complete the project.
36
For the twelve months
ended December 31, 2016, sales to five major customers accounted for 52.75% of our total revenue.
Technology Research and Development
We regard our services
and solutions and related software products as proprietary. We rely primarily on a combination of copyright, trademark and trade
secret laws of general applicability, employee confidentiality and invention assignment agreements, distribution and software protection
agreements and other intellectual property protection methods to safeguard our technology and software products. We have not applied
for patents on any of our technology. We also rely upon our efforts to design and produce new applications and upon improvements
to existing software products to maintain a competitive position in the marketplace.
On December 26, 2015,
we entered into a license agreement with Dr. Arthur M. Langer, which grants us a license for exclusive, perpetual, irrevocable
and worldwide use of the Langer Model to generate the Langer Index.
Research and product
development expenditures were approximately $54,945 for the twelve months ended December 31, 2016 and $524,741 for twelve months
ended December 31, 2015.
Strategic Alliances
Through our Lean Enterprise
Architecture Partnership ("LEAP") methodology, we have strategic alliances with technology specialists who perform
services on an as-needed basis for clients. We partner with niche specialty firms globally to obtain specialized resources
to meet client needs. Our business partners include executive recruiters, staffing firms and niche technology companies. The
terms of each strategic alliance arrangement depend on the nature of the particular partnership. Such alliance arrangements typically
set forth deliverables, scope of the services to be delivered, costs of services and terms and conditions of payment (generally
45 to 90 days for payment to be made). Each alliance arrangement also typically includes terms for indemnification of our company,
non-solicitation of each partner's employees by the other partner and dispute resolution by arbitration.
Alliances and partnerships
broaden our offerings and make us a one-stop solution for clients. Our team constantly produces services that complement
our portfolio and build strategic partnerships. Our partner companies range from RPA product companies, to digital marketing strategy
consulting firms, to large infrastructure players.
On any given project
we evaluate a client's needs and make our best effort to meet them with our full-time specialists. However, in certain circumstances,
we may need to go outside the Company, and in this case we approach our strategic partners to tap into their pools of technology
specialists. Project teams are usually composed of a mix of our full time employees and outside technology specialists. Occasionally,
a project team may consist of a Company manager and a few outside technology specialists. While final accountability for any of
our projects rests with the Company, the outside technology specialists are incentivized to successfully complete a project with
project completion payments that are in addition to hourly billing rates we pay the outside technology specialists.
Competition
The large number of
competitors and the speed of technology change make IT services and outsourcing a challenging business. Competitors in this market
include systems integration firms, contract programming companies, application software companies, traditional large consulting
firms, professional services groups of computer equipment companies and facilities management and outsourcing companies. Examples
of our competitors in the IT services industry include Accenture PLC, Cartesian Inc., Cognizant Technology Solutions Corporation,
Hexaware Technologies Limited, Infosys Technologies Limited, Mindtree Limited, RCM Technologies Inc., Tata Consultancy Services
Limited, Virtusa Corporation and Wipro Limited.
We believe that the
principal factors for success in the IT services and outsourcing market include performance and reliability; quality of technical
support, training and services; responsiveness to customer needs; reputation and experience; financial stability and strong corporate
governance; and competitive pricing.
37
Some of our competitors
have significantly greater financial, technical and marketing resources and/or greater name recognition, but we believe we are
well positioned to capitalize on the following competitive strengths to achieve future growth:
·
well-developed recruiting, training and retention model;
·
successful service delivery model;
·
broad referral base;
·
continual investment in process improvement and knowledge capture;
·
investment in research and development;
·
strong corporate governance; and
·
custom strategic partnerships to provide breadth and depth of services.
Employees
As of July 31, 2017,
we employed approximately 275 employees in 11 locations in the United States, Canada and India. We routinely supplement our employee
consulting staff with subcontractors, which totaled 175 at July 31, 2017, most of which were from other services
firms. Between our employees and subcontractors, we had 350 billable consultants at July 31, 2017. Our employees are
not part of a collective bargaining arrangement and we believe our relations with our employees are good.
We have employment agreements with our executive officers and certain other employees.
Properties
Our principal executive
office is located in approximately 2,547 square feet of office space in Princeton, New Jersey and is situated within an office
that also serves as the principal office of Ameri and Partners. We currently pay rent of $5,400 per month for our principal office.
We also lease administrative, marketing and product development and support facilities totaling approximately 14,000 square feet
in Atlanta, Georgia; Leawood, Kansas; Folsom, California and Chandler, Arizona in the U.S. and Chennai, Mumbai and Bangalore, India.
Most of our lease commitments end by 2020.
Legal Proceedings
We are not currently
a party to any pending legal proceeding, nor is our property the subject of a pending legal proceeding, that is not in the ordinary
course of business or otherwise material to the financial condition of our business.
38
Management's
Discussion and Analysis of Financial Condition and Results of Operations
The following discussion
and analysis of financial condition and results of operations of Ameri Holdings, Inc. should be read in conjunction with the financial
statements and related notes appearing elsewhere in this prospectus. Our actual results may not be indicative of future performance.
This discussion and analysis contains forward-looking statements and involves numerous risks and uncertainties, including, but
not limited to, those discussed in "Cautionary Note Regarding Forward-Looking Statements" and "Risk Factors."
Actual results may differ materially from those contained in any forward-looking statements.
Company Overview
We were incorporated
under the laws of the State of Delaware in February 1994 as Spatializer Audio Laboratories, Inc., which had been a shell company
until May of 2015. On May 26, 2015, we completed a "reverse merger" transaction, in which we caused Ameri100 Acquisition,
Inc., a Delaware corporation as our newly created, wholly owned subsidiary, to be merged with and into Ameri and Partners (doing
business as Ameri100), a Delaware corporation. As a result of the Merger, Ameri and Partners became our wholly owned subsidiary
with Ameri and Partners' former stockholders acquiring a majority of the outstanding shares of our common stock.
The
Merger was consummated under Delaware law, pursuant to the Merger Agreement, and in connection with the Merger we changed our name
to AMERI Holdings, Inc.
Since the Merger, we have been an active holding company headquartered in Princeton, New Jersey,
with offices across the United States that are supported by offices in India.
We specialize in delivering
SAP cloud, digital and enterprise services to clients worldwide. Our SAP focus allows us to provide technological solutions to
a broad and growing base of clients. Our model inverts the conventional global delivery model wherein offshore IT service providers
are based abroad and maintain a minimal presence in the United States. With a strong SAP focus, our client partnerships anchor
around SAP cloud services, artificial intelligence, internet of things and robotic process automation. We pursue an acquisition
strategy that seeks to disrupt the established business model of offshore IT service providers.
We generate revenue
by providing consulting services under written service contracts with our customers. The service contracts we enter into generally
fall into two categories: (1) time-and-materials contracts and (2) fixed-price contracts.
When a customer enters
into a time-and-materials or fixed-price (or a periodic retainer-based) contract, the revenue is recognized in accordance with
the deliverables of each contract. If the deliverables involve separate units of accounting, the consideration from the arrangement
is measured and allocated to the separate units, based on vendor specific objective evidence of the value for each deliverable.
The revenue under time
and materials contracts is recognized as services are rendered and performed at contractually agreed upon rates. Revenue pursuant
to fixed-price contracts is recognized under the proportional performance method of accounting. We routinely evaluate whether revenue
and profitability should be recognized in the current period. We estimate the proportional performance on fixed-price contracts
on a monthly basis utilizing hours incurred to date as a percentage of total estimated hours to complete the project.
For the twelve months
ended December 31, 2016, sales to five major customers, accounted for 52.75% of our total revenue.
We continue to explore
strategic alternatives to improve the market position and profitability of our product and service offerings in the marketplace,
generate additional liquidity for the Company, and enhance our valuation. We plan to pursue our goals during the next twelve months
principally through organic growth and through other strategic alternatives. Some of these alternatives have included, and could
continue to include, selective acquisitions. The Company has obtained financing and additional capital from the sale of equity
and incurrence of indebtedness in the past, and continues to consider capital raising and financing from the sale of various types
of equity and incurrence of indebtedness to provide capital for our business plans and operations in the future. The Company has
also provided, and may from time to time in the future provide, information to interested parties.
39
Matters that May or Are Currently Affecting Our Business
The main challenges
and trends that could affect or are affecting our financial results include:
·
Our ability to enter into additional technology-management and consulting agreements, to diversify
our client base and to expand the geographic areas we serve;
·
Our ability to attract competent, skilled professionals and on-demand technology partners for our
operations at acceptable prices to manage our overhead;
·
Our ability to acquire other technology services companies and integrate them with our existing
business;
·
Our ability to raise additional equity capital, if and when we needed;
·
We may incur an impairment of the goodwill acquired from our prior business acquisitions if our
acquired entities do not experience growth;
·
Our ability to control our costs of operation as we expand our organization and capabilities.
Result of Operations
Results
of Operations for the Three Months Ended June 30, 2017 Compared to the Three Months Ended June 30, 2016 and for the Six Months
Ended June 30, 2017 Compared to the Six Months Ended June 30, 2016
Three Months
Ended
June 30, 2017
Three Months
Ended
June 30, 2016
Six Months
Ended
June 30, 2017
Six Months
Ended
June 30, 2016
Revenue
$
12,268,259
$
6,686,938
$
24,609,186
$
13,699,902
Cost of revenue
9,935,468
5,169,538
18,975,045
10,926,845
Gross profit
2,332,791
1,517,400
5,634,141
2,773,057
Operating expenses
Selling and marketing
434,895
135,329
767,205
166,679
General and administration
4,405,377
1,977,510
7,106,522
3,696,100
Acquisition related expenses
175,136
239,815
384,480
615,220
Depreciation and amortization
825,657
101,385
1,514,757
213,013
Operating expenses
5,841,065
2,454,039
9,772,964
4,691,012
Operating income (loss)
(3,508,274
)
(936,639
)
(4,138,823
)
(1,917,955
)
Interest expenses
(164,343
)
(270,514
)
(255,149
)
(384,260
)
Changes in estimates
400,000
—
400,000
—
Other expense – net
8,624
(1,862
)
4,475
(2,161
)
Income (loss) before income taxes
(3,263,993
)
(1,209,015
)
(3,989,497
)
(2,304,376
)
Tax benefit / (provision)
—
—
—
—
Income after income taxes
(3,263,993
)
(1,209,015
)
(3,989,497
)
(2,304,376
)
Net income attributable to non-controlling interest
(15,388
)
—
(11,872
)
—
Net income (loss) attributable to the Company
(3,279,381
)
(1,209,015
)
(4,001,369
)
(2,304,376
)
Dividend on preferred stock
(504,826
)
—
(1,004,791
)
—
Net loss attributable to common stock holders
(3,784,207
)
(1,209,015
)
(5,006,160
)
(2,304,376
)
Other comprehensive income (loss), net of tax
Foreign exchange translation
(2,185
)
(2,808
)
3,150
(65,698
)
Comprehensive income/(loss)
$
(3,786,392
)
$
(1,211,823
)
$
(5,003,010
)
$
(2,370,074
)
Comprehensive income/(loss) attributable to the Company
(3,771,004
)
(1,211,823
)
(4,991,138
)
(2,370,074
)
Comprehensive income/(loss) attributable to the non-controlling interest
(15,388
)
—
(11,872
)
—
(3,786,392
)
(1,211,823
)
(5,003,010
)
(2,370,074
)
Basic income (loss) per share
$
(0.26
)
$
(0.09
)
$
(0.35
)
$
(0.19
)
Diluted income (loss) per share
$
(0.26
)
$
(0.09
)
$
(0.35
)
$
(0.19
)
Basic weighted average number of common shares outstanding
14,610,609
12,845,057
14,352,573
12,359,709
Diluted weighted average number of common shares outstanding
14,610,609
12,845,057
14,352,573
12,359,709
40
Revenues
Revenues
for the three months ended June 30, 2017 increased by approximately $5.58 million as compared to the three months ended June 30,
2016.  This increase was primarily attributable to our acquisition of Ameri California, Ameri Arizona and Bigtech. For changes
in revenue by entity please refer to the table below.
Revenues by
subsidiary of the Company
(in millions
of U.S. dollars)
Three Months Ended
June 30, 2017
Three Months Ended
June 30, 2016
Increase (Decrease)
Ameri & Partners
1.48
1.80
(0.32)
Ameri Georgia
4.73
4.89
(0.16)
Bigtech
0.29
-
0.29
Ameri Arizona
3.20
-
3.20
Ameri California
2.56
-
2.56
Total
12.27
6.69
5.58
Revenues
for the six months ended June 30, 2017 increased by approximately $10.91 million as compared to the six months ended June 30, 2016.
This increase was primarily attributable to our acquisition of Ameri California, Ameri Georgia and Bigtech. For changes in revenue
by entity please refer to the table below.
Revenues by subsidiary of the
Company
(in millions of U.S. dollars)
Six Months Ended
June 30, 2017
Six Months Ended
June 30, 2016
Increase (Decrease)
Ameri & Partners
3.38
3.46
(0.09)
Ameri Georgia
10.17
10.24
(0.07)
Bigtech
0.51
-
0.51
Ameri Arizona
7.03
-
7.03
Ameri California
3.52
-
3.52
Total
24.61
13.70
10.91
41
Gross Margin
Our
gross margin was 19% for the three months ended June 30, 2017, as compared to 23% for the three months ended June 30, 2016. 
Gross margin from our acquired entities was 23%; without our acquisitions our gross margin was at 15%. The decrease in gross margins
from our existing business was due to higher volume discounts, end of high margin contracts and revenue mix.
Our
gross margin was 23% for the six months ended June 30, 2017, as compared to 20% for the six months ended June 30, 2016. Gross margin
from our acquired entities was 24%; without our acquisitions our gross margin was at 22%.
Our
target gross margins are anticipated to be in the range of 25% to 30% based on the mix of project revenues and professional service
revenues. However, there is no assurance that we will achieve the anticipated gross margins.
Selling
and Marketing Expenses
Selling
and marketing expenses were $434,895 for the three months ended June 30, 2017, compared to $135,329 for the three months ended
June 30, 2016. The increase in selling and marketing expenses was directly attributable to our acquisition of Ameri Arizona and
Ameri California, which occurred subsequent to the comparable prior period.
Selling
and marketing expenses were $767,205 for the six months ended June 30, 2017, compared to $166,679 for the six months ended June
30, 2016. The increase in selling and marketing expenses was directly attributable to our acquisition of Ameri Arizona and Ameri
California, which occurred subsequent to the comparable prior period.
General
and Administration Expenses
General
and Administration ("G&A") expenses include all costs, including rent costs, which are not directly associated
with revenue-generating activities, as well as the non-cash expense for stock based compensation. These include employee costs,
corporate costs and facilities costs. Employee costs include administrative salaries and related employee benefits, travel, recruiting
and training costs. Corporate costs include reorganization costs, legal, accounting and outside consulting fees. Facility costs
primarily include rent and communications costs.
G&A
expenses for the three months ended June 30, 2017 were $4,405,377 as compared to $1,977,510 for the three months ended June 30,
2016.  G&A expenses increased by $2,427,867, of which $1,562,526 was attributable to our stock based compensation expense
due to grants made to our employees and accelerated expenses upon cancellation of restricted stock units. Ameri California, Ameri
Arizona and Bigtech added an additional $1,018,717 to our G&A expenses for the three months ended June 30, 2017 as compared
to the same period in 2016.  Our G&A expenses for the three months ended June 30, 2017 excluding these acquisitions increased
due to our continued fund-raising activity and preparation of a Nasdaq listing application.
G&A
expenses for the six months ended June 30, 2017 were $7,106,522 as compared to $3,696,100 for the six months ended June 30, 2016. 
G&A expenses increased by $3,410,422, of which $2,027,276 was attributable to our stock based compensation expense due to grants
made to our employees and accelerated expenses upon cancellation of restricted stock units. Ameri California, Ameri Arizona and
Bigtech added an additional $1,736,843 to our G&A expenses for the six months ended June 30, 2017 as compared to the same period
in 2016. The decrease in G&A expenses during the six months ended June 30, 2017 was attributable to the cost synergies we achieved
with our previous acquisitions.
42
Depreciation
and Amortization
Depreciation
and amortization expense amounted to $825,657 for the three months ended June 30, 2017, as compared to $101,385 for the three months
ended June 30, 2016. We capitalized the customer lists acquired during various acquisitions, resulting in increased amortization
costs. The customer lists from each acquisition are amortized over a period of 60 months.
Depreciation
and amortization expense amounted to $1,514,757 for the six months ended June 30, 2017, as compared to $213,013 for the six months
ended June 30, 2016. We capitalized the customer lists acquired during various acquisitions, resulting in increased amortization
costs. The customer lists from each acquisition are amortized over a period of 60 months.
Operating
Income (Loss)
Our
operating income (loss) was ($3,508,274) for the three months ended June 30, 2017, as compared to ($936,639) for the three months
ended June 30, 2016. This increase in loss was mainly due to the increase in G&A expenses of our acquired entities.
Our
operating income (loss) was ($4,138,823) for the six months ended June 30, 2017, as compared to ($1,917,955) for the six months
ended June 30, 2016. This increase in loss was mainly due to the increase in G&A expenses of our acquired entities.
Interest
Expense
Our
interest expense for the three months ended June 30, 2017 was $164,343 as compared to $270,514 for the three months ended June
30, 2016. The decrease is mainly due to changes in interest rates charged by our lenders.
Our
interest expense for the six months ended June 30, 2017 was $255,149 as compared to $384,260 for the six months ended June 30,
2016. The decrease is mainly due to changes in interest rates charged by our lenders.
Changes
in Estimates
Based
on our current estimates of consideration payable under the Ameri Arizona purchase agreement, we do not believe Ameri Arizona will
achieve its 2017 earn-out and we have adjusted the consideration payable in connection therewith by reducing the estimates by $400,000
and reflecting the adjustment in our income statement for the quarter ended June 30, 2017.
Income taxes
Our
provision for income taxes for the three months ended June 30, 2017 and the three months period ended June 30, 2016 was $0 for
each period.
Our
provision for income taxes for the six months ended June 30, 2017 and the six months period ended June 30, 2016 was $0 for each
period.
Acquisition
Related Expenses
We
had acquisition related expenditures of $384,480 and $615,220 during the six months ended June 30, 2017 and June 30, 2016, respectively.
These expenses included acquisition costs and legal, banking and other acquisition related fees incurred in connection with our
acquisitions. The decrease is due to the decline in acquisition related activities in the six months ended June 30, 2017 as compared
to the six months ended June 30, 2016.
43
Results of Operations for the Twelve Months Ended
December 31, 2016 Compared to the Twelve Months Ended December 31, 2015
Twelve
Months
Ended
December
31,
2016
2015
Net revenue
$
36,145,589
$
20,261,172
Cost of revenue
29,608,932
13,391,504
Gross profit
6,536,657
6,869,668
Operating expenses:
Selling and marketing
417,249
119,847
General and administration
8,552,966
5,721,633
Acquisition related expenses
1,585,136
1,655,962
Depreciation and amortization
1,361,169
166,208
Operating expenses
11,916,520
7,663,650
Operating income (loss):
(5,379,863
)
(793,982
)
Interest expense
(751,074
)
(238,471
)
Interest income/other income
—
89,918
Other income
16,604
—
Change due to estimate correction
(410,817
)
—
Total other income (expenses)
(1,145,287
)
(148,553
)
Net income (loss) before income taxes
(6,525,150
)
(942,535
)
Income tax benefit (provision)
3,747,846
128,460
Net income (loss)
(2,777,304
)
(814,075
)
Non-controlling interest
(3,382
)
—
Net income (loss) attributable to the Company
(2,780,686
)
(814,075
)
Foreign exchange translation adjustment
(7,426
)
—
Comprehensive income (loss)
$
(2,788,112
)
$
(814,075
)
Revenues
Revenues for the twelve
months ended December 31, 2016 increased by 78% from the twelve months ended December 31, 2015 to $36,145,589. As shown in the
table below, a significant part of the increase in the revenue came from the businesses we acquired in 2016 and also from our acquisition
of Ameri Georgia, which was completed in November 2015. Our 2016 revenues include a full year of revenue for Ameri Georgia, whereas
our 2015 revenues only included Ameri Georgia's revenue for a portion of 2015. Revenue from our wholly owned subsidiary Ameri
and Partners decreased by $4.8 million in 2016, as compared to 2015, due to the completion of a significant project in 2016.
Revenues by subsidiary of the
Company
(in millions of U.S. dollars)
2016
2015
Increase (Decrease)
Ameri and Partners
6.9
11.7
(4.8)
Ameri Georgia
19.9
8.6
11.4
Virtuoso
1.1
-
1.1
Ameri Arizona
7.7
-
7.7
Bigtech
0.5
-
0.5
Total
36.1
20.3
15.9
44
Our top five customers
accounted for 52.75 % of our revenues for the twelve months ended December 31, 2016. We derived 98% of our revenues from our
customers located in North America for the twelve months ended December 31, 2016.
Gross Margin
Our gross margin was
$6,536,657, or 18.1%, for the twelve months ended December 31, 2016, as compared to $6,869,668, or 33.9%, for the twelve months
ended December 31, 2015. The change in gross margin for 2016 was a result of lower margins for professional services and a decrease
in project revenues in 2016 than in 2015.
In 2015, the company
executed a large transformational project for one key customer, which yielded significant gross margins. That project ended in
early 2016, resulting in gross margins for 2015 that were higher than our gross margins for 2016. In addition, the acquisition
of businesses that operate on the professional services revenue model, which tends to have lower margins than the project-based
revenues model, lowered our overall gross margin. We intend to change the business models of our acquired businesses to a project-based
revenue model as we integrate each acquisition into our business; however, lower margins may continue to impact our results until
all acquisitions have been fully converted to the project-based revenue model.
Selling and Marketing Expenses
Selling and marketing
expenses were $417,249 for the twelve months ended December 31, 2016, compared to $119,847 for the twelve months ended December
31, 2015. The increase in selling and marketing expenses was directly attributable to the addition of Ameri Georgia's selling
and marketing expenses in 2016, following its acquisition in late 2015.
General and Administration Expenses
G&A expenses include
all costs, including rent costs, which are not directly associated with revenue-generating activities, as well as the non-cash
expense for stock based compensation. These include employee costs, corporate costs and facilities costs. Employee costs include
administrative salaries and related employee benefits, travel, recruiting and training costs. Corporate costs include reorganization
costs, legal, accounting and outside consulting fees. Facilities costs primarily include rent and communications costs.
G&A expenses for
the twelve months ended December 31, 2016 was $8,552,966 as compared to $5,721,633 for the year ended December 31, 2015. Our
consolidated G&A expenses increased due to the addition of G&A expenses of our Ameri Georgia, Ameri Arizona, Virtuoso and
Bigtech subsidiaries in 2016, which added $2,653,441, $1,217,865, $445,375 and $139,497, respectively, to our total G&A expenses,
and there were not comparable subsidiary G&A expenses in 2015. Our aggregate G&A expenses for 2016 also includes $1,450,000
in expense for stock based compensation paid in connection with our acquisitions. The overall growth in G&A expenses was moderated
by cost synergies, including consolidating global teams for finance, recruitment and human resources.
Acquisition Related Expenses
Acquisition related
expenses of $1,585,136 were incurred during the twelve months ended December 31, 2016. These expenses included acquisition costs
and legal, banking and other acquisition related fees incurred in connection with our acquisitions. Increased legal costs were
incurred as a result of various acquisition related activities as well as the additional incremental costs or pursuing additional
acquisitions.
45
Our acquisitions related
expenses consisted of the following:
·
$53,288 for an event in connection with integrating all acquired subsidiaries with the Company;
·
$229,440 for fees in connection with terminating our prior credit facility and replacing it with
our current credit facility with Sterling National Bank;
·
$312,500 for payments to a financial advisor for its assistance in obtaining our current credit
facility with Sterling National Bank;
·
$349,902 for earn-out payments to the former owners of Ameri Georgia; and
·
$640,006 for legal fees in connection with our acquisitions.
All of the foregoing
expenses were specific to events of the Company that occurred in 2016 and we do not expect further ongoing expenses with those
events.
Depreciation and Amortization
Depreciation and amortization
expense amounted to $1,361,169 for the twelve months ended December 31, 2016, as compared to $166,208 for the twelve months
ended December 31, 2015. We capitalized the customer lists received from each of our acquisitions during 2016, resulting in increased
amortization costs. The customer lists from each acquisition are amortized over a period of 60 months.
Our amortization schedule
is as follows:
Years ending December 31,
Amount
2017
$
2,464,184
2018
2,115,592
2019
1,748,250
2020
1,621,000
2021
815,678
Total
$
8,764,704
Operating income
Our operating income
percentage was (14.9) % for the twelve months ended December 31, 2016, as compared to (3.9) % for the twelve months ended
December 31, 2015. This change was mainly due to an increase in selling and marketing, G&A expenses and acquisition related
expenses.
Income taxes
Our benefit for income
taxes for the twelve months ended December 31, 2016 and the twelve months ended December 31, 2015 amounted to approximately $3,747,846
and $128,460, respectively.
46
Liquidity and
Capital Resources
Our cash position was
$1,041,133 as of June 30, 2017, as compared to $1,379,887 as of December 31, 2016, a decrease of $338,754 primarily due to use
of fund towards working capital and earn-out payments.
Cash used for operating
activities was $1,700,989 during the six months ended June 30, 2017 and was primarily a result of net changes in working capital
requirements. Cash used in investing activities was $702,511 during the six months ended June 30, 2017. Cash provided by financing
activities was $2,064,746 during the six months ended June 30, 2017 and was attributable to the increased borrowing under our line
of credit with Sterling National Bank and the issuance of convertible notes.
Due to our current
constraints in working capital, we have been unable to pay a few vendors and as a result some of them have threatened legal action
against us. We are currently working with these vendors to negotiate longer payment terms until we are able to raise more capital;
the Company is trying to mitigate these efforts by raising more capital and through streamlining its operations which will provide
cash savings going forward, however there can be no assurance that the Company will be able to secure additional sources of capital.
In case we are unable to pay these vendors, they can take legal action against us or stop doing business with us which may have
an impact on our revenue.
On July 1, 2016, the
Company entered into Loan and Security Agreement (the "Loan Agreement"), with its wholly-owned subsidiaries Ameri and
Partners Inc and Ameri Georgia, as borrowers (the "Borrowers"), the Company and its wholly-owned subsidiaries Linear
Logics, Corp. and WinHire Inc serving as guarantors, the Company's Chief Executive Officer, Giri Devanur, serving as a validity
guarantor, and Sterling National Bank, N.A. (as lender and as agent, "Sterling"). The Company joined Ameri California,
Virtuoso and Ameri Arizona as borrowers under the Loan Agreement following their respective acquisition.
Under the Loan Agreement,
the Borrowers can borrow up to an aggregate of $10 million, which includes up to $8 million in principal for revolving loans (the
"Revolving Loans") for general working capital purposes, up to $2 million in principal pursuant to a term loan (the
"Term Loan") for the purpose of a permitted business acquisition and up to $200,000 for letters of credit. A portion
of the proceeds of the Loan Agreement were also used to repay the November 20, 2015 credit facility that was entered into between
the Company, its wholly-owned subsidiary Ameri Georgia and Federal National Payables, Inc.
The maturity of the
loans under the Loan Agreement are as follows:
Revolving Loan Maturity
Date: July 1, 2019; provided, however, that the Revolving Loan Maturity Date will extend and renew automatically for successive
one-year terms on each anniversary of the initial Revolving Loan Maturity Date (each an "Anniversary Date") thereafter,
unless not less than sixty (60) days prior to any such Anniversary Date, written notice of non-renewal is given by either party
to the other, in which case the Revolving Loan Maturity Date will be such next Anniversary Date.
Term Loan Maturity
Date: The earliest of (a) the date following acceleration of the Term Loan and/or the Revolving Loans; (b) the Revolving Loan Maturity
Date; or (c) July 1, 2019.
Interest under the
Loan Agreement is payable monthly in arrears and accrues as follows:
(a)
in the case of Revolving Loans, a rate per annum equal to the sum of (i) the Wall Street Journal
Prime Rate plus (ii) 2.00%;
(b)
in the case of the Term Loan, a rate per annum equal to the sum of (i) the Wall Street Journal
Prime Rate plus (ii) 3.75%; and
(c)
in the case of other obligations of the Borrowers, a rate per annum equal to the sum of (i) the
greater of (A) 3.25% or (B) Wall Street Journal Prime Rate plus (ii) 3.75%.
The Loan Agreement
also requires the payment of certain fees, including, but not limited to letter of credit fees and an unused Revolving Loans fee.
47
The Loan Agreement
contains financial and other covenant requirements, including, but not limited to, financial covenants that require the Borrowers
to not permit capital expenditures above $150,000 in any fiscal year, maintain a fixed charge coverage ratio of not less than 2.00
to 1.00 and maintain certain debt to EBITDA ratios. The Loan Agreement also requires the Company and Borrowers to obtain Sterling's
consent before making any permitted acquisitions. The amounts borrowed by the Borrowers under the Loan Agreement are guaranteed
by the guarantors, and the Loan Agreement is secured by substantially all of the Borrowers' assets.
The principal amount
of the Term Loan will be repaid as follows: (i) equal consecutive monthly installments in the amount of $33,333.33 each, paid on
the first day of each calendar month and (ii) one final payment of the entire remaining principal balance, together with all accrued
unpaid interest on the Term Loan maturity date.
To date, we are not
in compliance with the financial covenants contained in its Loan Agreement with Sterling National Bank.
We
received a waiver from Sterling National Bank for our non-compliance with the Loan Agreement for the quarters ended March 31, 2017
and June 30, 2017 in exchange for the payment of a fee of $5,000 for each quarterly waiver.
We do not expect to be in compliance
with the terms of the Loan Agreement following the conclusion of the terms of the waivers granted by Sterling National Bank. We
continue to work with Sterling National Bank to address its non-compliance.
If
we are unable to obtain future waivers from Sterling National Bank, the bank could declare our loans with it to be in default and
elect to claim all amounts outstanding to be immediately due and payable and terminate all commitments to extend further credit.
If we are unable to repay the outstanding amounts, Sterling National Bank could proceed against the collateral granted to it to
secure our indebtedness to it. We pledged substantially all of our assets as collateral under the Loan Agreement. The Loan Agreement
is also supported by a limited guaranty from Giri Devanur, our President and Chief Executive Officer. If Sterling National Bank
accelerates the repayment of our loans, there is no assurance that we will have sufficient assets to repay the loans. A default
under the Loan Agreement may also result in an event of default under the 2017 Notes. We are currently looking for additional sources
of financing, however there is no guarantee that we will have additional financing available to us.
Interest paid on Term
Loan during the period ended June 30, 2017 amounted to $69,625. Principal repaid on the Term Loan during the period ended June
30, 2017 was $200,000. The short term and long-term outstanding balances on the Term Loan as of June 30, 2017 were $399,996 and
$1,323,470, respectively. The outstanding balance of the Revolving Loans as of June 30, 2017 was $3,794,042.
Bigtech, which was
acquired as of July 1, 2016, had a term loan of $16,283 and a line of credit for $311,412 as of June 30, 2017. The Bigtech line
of credit is with an Indian bank, HDFC Bank Limited, and was entered into on June 3, 2015 for Bigtech's working capital requirements.
The line of credit is for up to $416,667 with an interest rate of 11.85% per annum and maturity in June 2020. The Bigtech term
loan accrues interest at the rate of 10.30% per annum and matures in 2020. Both the term loan and the line of credit were already
in place when the Company acquired Bigtech. Interest paid during the period ended June 30, 2017 amounted to $20,543 for the term
loan and line of credit held by Bigtech.
For the purpose of
financing the ongoing business and operations of our company, on April 20, 2016, we entered into a Stock Purchase Agreement with
Dhruwa N. Rai, pursuant to which Mr. Rai purchased 500,000 unregistered shares of our common stock, par value $0.01 per share,
from us at a price per share of $6.00 for aggregate consideration to us of $3,000,000.
On May 13, 2016, LSVI
completed an early partial exercise of its Original Warrant for 1,111,111 shares of our common stock at a price of $1.80 per share,
for total consideration to us of $2,000,000, and LSVI was issued a replacement warrant for the remaining 1,166,666 shares
under the Original Warrant on the same terms as the Original Warrant.
On March 7, 2017, we
completed the sale and issuance of the 2017 Notes for aggregate proceeds to us of $1,250,000 from four accredited investors, including
one of the Company's directors, Dhruwa N. Rai. The 2017 Notes were issued pursuant to Securities Purchase Agreements between
the Company and each investor. The 2017 Notes bear interest at 8% per annum until maturity in March 2020, with interest being
paid annually on the first, second and third anniversaries of the issuance of the 2017 Notes beginning in March 2018. From and
after an event of default and for so long as the event of default is continuing, the 2017 Notes will bear default interest at the
rate of 10% per annum. The 2017 Notes can be prepaid by us at any time without penalty.
48
The 2017 Notes are
convertible into shares of our common stock at a conversion price equal to $______ (equal to 68% of the price per share of the
common stock sold in this offering). Upon the effectiveness of this registration statement, the holders of the 2017 Notes have
the right, at their option, at any time and from time to time to convert, in part or in whole, the outstanding principal amount
and all accrued and unpaid interest under the 2017 Notes into shares of the Company's common stock at the then applicable
conversion price.
The 2017 Notes rank
junior to our secured credit facility with Sterling National Bank. The 2017 Notes also include certain negative covenants including,
without the investors' approval, restrictions on dividends and other restricted payments and reclassification of its stock.
Operating Activities
Our largest source
of operating cash flows is cash collections from our customers for different information technology services we render under various
statements of work. Our primary uses of cash from operating activities are for personnel-related expenses, leased facilities and
taxes.
Future Sources of Liquidity
We expect our primary
source of cash to be positive net cash flows provided by operating activities. We also continue to focus on cost reductions and
have initiated steps to reduce overheads and provide cash savings.
Based on past performance
and current expectations, we expect our existing cash, cash equivalents and short-term investments, and our ongoing cash flows
that are not deemed permanently reinvested, to be sufficient to meet our operating liquidity requirements described above for at
least the 12 months following the date of this offering.
We may raise additional
capital through the private and/or public sale of equity or debt securities, borrowings from financial institutions or third parties
or a combination of the foregoing. Any capital raised will be used to implement our business plan, grow current operations, make
acquisitions or start new vertical businesses.
Off-Balance Sheet Arrangements
We do not have any
off-balance sheet arrangements.
Seasonality
Our operations are
generally not affected by seasonal fluctuations. However, our consultants' billable hours are affected by national holidays
and vacation policies, which vary by country.
Climate Change
We do not believe there
is anything unique to our business which would result in climate change regulations having a disproportional effect on us as compared
to U.S. industry overall.
Impact of Inflation
We do not believe that
inflation had a significant impact on our results of operations for the periods presented. On an ongoing basis, we attempt to minimize
any effects of inflation on our operating results by controlling operating costs and, whenever possible, seeking to ensure that
billing rates reflect increases in costs due to inflation.
For all significant
foreign operations, the functional currency is the local currency. Assets and liabilities of these operations are translated at
the exchange rate in effect at each period end. Statements of Operations accounts are translated at the exchange rate prevailing
as of the date of the transaction. The gains or losses resulting from such translation are reported under accumulated other comprehensive
income (loss) as a separate component of equity. Realized gains and losses from foreign currency transactions are included in other
income, net for the periods presented.
49
Critical Accounting Policies
Purchase Price
Allocation.
We allocate the purchase price of our acquisitions to the assets and liabilities acquired, including identifiable
intangible assets, based on their respective fair values at the date of acquisition. Some of the items, including accounts receivable,
property and equipment, other intangible assets, certain accrued liabilities and other reserves require a degree of management
judgment. Certain estimates may change as additional information becomes available. Goodwill is assigned at the enterprise level
and is deductible for tax purposes for certain types of acquisitions. Management finalizes the purchase price allocation within
the defined measurement period of the acquisition date as certain initial accounting estimates are resolved.
Valuation of
Contingent Earn-out Consideration.
Acquisitions may include contingent consideration payments based on the achievement
of certain future financial performance measures of the acquired company. Contingent consideration is required to be recognized
at fair value as of the acquisition date. We estimate the fair value of these liabilities based on financial projections of the
acquired companies and estimated probabilities of achievement. We believe our estimates and assumptions are reasonable, however,
there is significant judgment involved. We evaluate, on a routine, periodic basis, the estimated fair value of the contingent consideration
and changes in estimated fair value, subsequent to the initial fair value estimate at the time of the acquisition, will be reflected
in income or expense in the consolidated statements of operations. Changes in the fair value of contingent consideration obligations
may result from changes in discount periods and rates, changes in the timing and amount of revenue and/or earnings estimates and
changes in probability assumptions with respect to the likelihood of achieving the various earn-out criteria. Any changes in the
estimated fair value of contingent consideration may have a material impact on our operating results.
Revenue Recognition.
We
recognize revenue in accordance with the Accounting Standard Codification 605 "Revenue Recognition." Revenue is recognized
when all of the following criteria are met: (1) persuasive evidence of an arrangement exists, (2) delivery has occurred or services
have been rendered, (3) the seller's price to buyer is fixed and determinable, and (4) collectability is reasonably assured.
We recognize revenue from information technology services as the services are provided. Service revenues are recognized based on
contracted hourly rates, as services are rendered or upon completion of specified contracted services and acceptance by the customer.
Accounts Receivable.
We
extend credit to clients based upon management's assessment of their credit-worthiness on an unsecured basis. We provide
an allowance for uncollectible accounts based on historical experience and management evaluation of trend analysis. We include
any balances that are determined to be uncollectible in allowance for doubtful accounts. The allowance for uncollectible accounts
as of December 31, 2016 was $0 and the allowance as of December 31, 2015 was $409,749. Based on the information available, management
believes our accounts receivable, net of allowance for doubtful accounts, are collectible.
Property
and Equipment.
Property and equipment is stated at cost. We provide for depreciation of property and equipment using
the straight-line method over the estimated useful lives of the related assets ranging from 3 to 7 years. Leasehold improvements
are amortized using the straight-line method over the shorter of the lease terms or the useful lives of the improvements. We charge
repairs and maintenance costs that do not extend the lives of the assets to expenses as incurred.
We account for computer
software costs developed for internal use in accordance with accounting principles generally accepted in the Unites States, which
require companies to capitalize certain qualifying costs during the application development stage of the related software development
project and to exclude the initial planning phase that determines performance requirements, most data conversion, general and administrative
costs related to payroll and training costs incurred. Whenever a software program is considered operational, we consider the project
to be completed, place it into service and commence amortization of the development cost in the succeeding month.
50
Recent Accounting Pronouncements
New Standards to Be Implemented
In
May 2014, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU")
2014-09, "Revenue from Contracts with Customers (Topic 606)," which supersedes the revenue recognition requirements
in "Revenue Recognition (Topic 605)." This ASU requires an entity to recognize revenue when goods are transferred or
services are provided to customers in an amount that reflects the consideration to which the entity expects to be entitled to in
exchange for those goods or services. This ASU also requires disclosures enabling users of financial statements to understand the
nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In August 2015, the FASB
issued ASU 2015-14, "Revenue from Contracts with Customers (Topic 606), deferral of the Effective Date." With the issuance
of ASU 2015-14, the new revenue guidance ASU 2014-09 will be effective for annual periods, and interim periods within those annual
periods, beginning after December 15, 2018, using one of two prescribed retrospective methods. In April 2016, the FASB issued ASU
2016-10, "Revenue from Contracts with Customer (Topic 606), Identifying Performance Obligations and Licensing." The
guidance is applicable from the date of applicability of ASU 2014-09. This ASU finalizes the amendments to the guidance on the
new revenue standard on the identification of performance obligations and accounting for licenses of intellectual property. In
December 2016, the FASB issued ASU 2016-20, "Technical Corrections and Improvements (Topic 606)" which is applicable
from the date of applicability of ASU 2014-09. This guidance provides optional exemptions from the disclosure requirement for remaining
performance obligations for specific situations in which an entity need not estimate variable consideration to recognize revenue.
In May 2016, FASB issued ASU No. 2016-12, "Narrow-Scope Improvements and Practical Expedients". This amendment clarified
certain aspects of Topic 606 and will be applicable from the date of applicability of ASU 2014-09. The Company is in process of
evaluating the impact of the foregoing updates.
In
February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)". This new standard replaces the existing guidance
on leases and requires the lessee to recognize a right-of-use asset and a lease liability for all leases with lease terms equal
to or greater than twelve months. For finance leases, the lessee would recognize interest expense and amortization of the right-of-use
asset, and for operating leases, the lessee would recognize total lease expense on a straight-line basis. This standard is effective
for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2018. Upon adoption, entities
will be required to use a modified retrospective transition which provides for certain practical expedients. Entities are required
to apply the new standard at the beginning of the earliest comparative period presented. Early adoption of this new standard is
permitted. The Company is currently evaluating the effect this new standard will have on its consolidated financial statements
and related disclosures. The Company does not expect the requirement to recognize a right-of-use asset and a lease liability for
operating leases to have a material impact on the presentation of its consolidated statements of financial position.
In
August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash
Payments (ASU 2016-15), which clarifies how companies present and classify certain cash receipts and cash payments in the statement
of cash flows. The guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal
years. Based on its current assessment, the Company does not expect the adoption of this update to have a material impact on its
consolidated financial statements.
On
November 17, 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which is intended to reduce
diversity in the presentation of restricted cash and restricted cash equivalents in the statement of cash flows. This new standard
requires that restricted cash and restricted cash equivalents be included as components of total cash and cash equivalents as presented
on the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted
cash and restricted cash equivalents in the statement of cash flows. ASU 2016-18 is effective for annual periods beginning after
December 15, 2017 including interim periods within those fiscal years, but earlier adoption is permitted.  The Company does
not believe the adoption of this new standard will have a material impact on its consolidated financial statements.
In
January 2017, the FASB issued ASU No. 2017-04, simplifying the Test for Goodwill Impairment. Under this new standard, goodwill
impairment would be measured as the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed
the carrying value of goodwill. This ASU eliminates existing guidance that requires an entity to determine goodwill impairment
by calculating the implied fair value of goodwill by hypothetically assigning the fair value of a reporting unit to all of its
assets and liabilities as if that reporting unit had been acquired in a business combination. This update is effective for annual
periods beginning after December 15, 2019, and interim periods within those periods. Early adoption is permitted for interim or
annual goodwill impairment test performed on testing dates after January 1, 2017. The Company is in process of evaluating the impact
of these updates.
51
In
January 2017, the FASB issued ASU No. 2017-01, clarifying the Definition of a Business, which clarifies and provides a more robust
framework to use in determining when a set of assets and activities is a business. The amendments in this update should be applied
prospectively on or after the effective date. This update is effective for annual periods beginning after December 15, 2017 and
interim periods within those periods. Early adoption is permitted for acquisition or deconsolidation transactions occurring before
the issuance date or effective date and only when the transactions have not been reported in issued or made available for issuance
financial statements. The Company does not believe the adoption of this new standard will have a material impact on its consolidated
financial statements.
Standards
Implemented
In
September 2015, the FASB issued ASU No. 2015-16, "Simplifying the Accounting for Measurement-Period Adjustments". The
guidance eliminates the requirement that an acquirer in a business combination account for a measurement period adjustment retrospectively.
Instead, an acquirer will recognize a measurement period adjustment during the period in which the amount of the adjustment is
determined. In addition, the portion of the amount recorded in current period earnings by line item that would have been recorded
in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date should
be presented separately on the face of the income statement or disclosed in the notes. This guidance was effective for fiscal years
beginning after December 15, 2015, including interim periods within those fiscal years. This guidance did not have a material impact
on the Company's consolidated financial results.
In
March 2016, the FASB issued ASU No. 2016-09, "Compensation – Stock Compensation". The new guidance changes the
accounting for share based payment transactions, including the income tax consequences, classification of awards as either equity
or liabilities and classification in the Consolidated Statement of Cash Flows. The guidance is effective for annual periods beginning
after December 15, 2016, and interim periods within those annual periods. This guidance did not have a material impact on the Company's
consolidated financial results.
52
Management
Executive Officers
and Directors
The names and ages
of our executive officers and directors, and their positions with us, are as follows:
Name
Age
Position
Jeffrey E. Eberwein
47
Chairman of the Board
Srinidhi "Dev" Devanur
52
Executive Vice Chairman of the Board and Director
Giri Devanur
48
President, Chief Executive Officer and Director
Viraj Patel
54
Chief Financial Officer
Dimitrios J. Angelis
47
Director
Dr. Arthur M. Langer
64
Director
Robert G. Pearse
57
Director
Dhruwa N. Rai
48
Director
Venkatraman Balakrishnan
52
Director
The principal occupations
for the past five years (and, in some instances, for prior years) of each of our directors and executive officers are as follows:
Jeffrey E. Eberwein
became our Chairman of the Board in May 2015. Mr. Eberwein is a Lone Star Value designee on the Board. He has 25 years of Wall
Street experience and is CEO of Lone Star Value Management, LLC ("LSVM"), a U.S. registered investment company. Prior
to founding LSVM in January 2013, Mr. Eberwein was a Portfolio Manager at Soros Fund Management from January 2009 to December 2011
and Viking Global Investors from March 2005 to September 2008. Mr. Eberwein serves as Chairman of the board of three other public
companies: Digirad Corporation, a medical imaging Company; ATRM Holdings, Inc., a modular building company; and Hudson Global Inc.,
a global recruitment company. In addition, Mr. Eberwein serves as a director of Novation Companies, Inc., a specialty finance company.
Previously, Mr. Eberwein also served on the Board of Hope for New York, a charitable organization dedicated to serving the poor
in New York City, from 2011 until 2014, where he was the Treasurer and on its Executive Committee. Mr. Eberwein earned an M.B.A.
from The Wharton School, University of Pennsylvania, and a B.B.A. degree with High Honors from The University of Texas at Austin.
The Board believes that Mr. Eberwein's qualifications to serve on the Board include his expertise in finance and experience
in the investment community.
Srinidhi "Dev"
Devanur
became our Executive Vice Chairman and a member of our Board in May 2015. Mr. Devanur founded our operating subsidiary
Ameri and Partners in November 2013 and served as its chairman prior to the Merger. He is a seasoned technology entrepreneur who
has more than 20 years of experience in the IT services industry with a specialization in sales and resource management. He has
built businesses from ground up and has successfully executed acquisitions, mergers and corporate investments. He has managed the
sales function by working closely with various Fortune 500 customers in the United States and India to sell software solutions,
support and staff augmentation related services. Mr. Devanur co-founded Ivega Corporation in 1997, an international niche IT consulting
company with special focus on financial services which merged with TCG in 2004, creating a 1,000+ person focused differentiator
in the IT consulting space. Following this, he founded SaintLife Bio-pharma Pvt. Ltd., which was acquired by a Nasdaq listed company.
Mr. Devanur has a bachelor's degree in electrical engineering from the University of Bangalore, India and has also attended
a Certificate program in Strategic Sales Management at the University of Chicago Booth School of Business. The Board believes that
Mr. Devanur's qualifications to serve on the Board include his background in the IT services industry and his experience
in business development.
Giri Devanur
became
our President, Chief Executive Officer and a member of our Board in May 2015. Mr. Devanur served as the President and Chief Executive
Officer of our operating subsidiary Ameri and Partners, since its inception in November 2013. He is a seasoned chief executive
officer who has raised seed capital, venture capital and private equity from global institutions. He has more than 25 years of
experience in the information technology industry. In 2010, he founded WinHire Inc, an innovative company building software products
through technology and human capital management experts and combining them with professional services, and served as its President
and Chief Executive Officer. He co-founded Ivega Corporation in 1997, an international niche IT consulting company with special
focus on financial services which merged with TCG in 2004, creating a 1,000+ person focused differentiator in the IT consulting
space. Giri Devanur has a Master's degree in Technology Management from Columbia University and a bachelor's degree
in computer engineering from the University of Mysore, India. He has attended Executive Education programs at the Massachusetts
Institute of Technology and Harvard Law School. The Board believes that Mr. Devanur's qualifications to serve on the Board
include his substantial experience in the information technology industry and his prior experience as a chief executive officer.
53
Viraj
Patel
became our Chief Financial Officer in April 2017. He is a seasoned finance and operations executive having served as
a Chief Financial Officer of both public and start-up companies. He has over 30 years of experience in the technology, life science
and industrial sectors with significant experience in domestic and international markets, fund-raising and mergers and acquisitions.
From February 2016 to March 2017, Mr. Patel worked as an independent consultant and served as Chief Financial Officer (on a pro
bono basis) for Human Needs Project, a non-governmental organization that provides funding and services to local communities in
Africa. Previously, Mr. Patel served as the Chief Financial Officer of Aqua Metrology Systems, a developer of online and offline
analytical instruments for detection of water contaminants, from August 2015 to January 2016. Prior to that he served as the Chief
Financial Officer of Aspire Public Schools, a leading national K-12 charter schools management organization, from September 2013
to March 2015. From September 2010 to March 2013, Mr. Patel served as the Chief Financial Officer of Imergy Power Systems, a manufacturer
of energy storage solutions. From November 2005 to February 2010, he served as the Chief Financial Officer of public technology
companies, including as UTStarcom, a global telecom infrastructure provider, and prior to that at Avanti Corporation, an electronic
design automation company that was later acquired by Synopsys, Inc. Mr. Patel also served as Vice President of Finance at Nektar
Therapeutics and Chief Accounting Officer at Pall Corporation. Mr. Patel also served as an independent board member and audit committee
chairman for Helios & Matheson (a NASDAQ listed public company in the data and financial analytics sector), from May 2012 through
April 2016 and as a board advisor until July 2016. Mr. Patel began his professional career at PricewaterhouseCoopers in New York
and holds a bachelor's degree in business from Pace University, New York. He is an active Certified Public Accountant in
the State of New York and is a member of the New York State Society of Certified Public Accountants and a member of the American
Institute of Certified Public Accountants.
Dimitrios J. Angelis
became a member of our Board in May 2015. Mr. Angelis currently works with the Life Sciences Law Group, providing outside General
Counsel advice to pharmaceutical, medical device and biologics companies. He is also a director of Digirad Inc., a leader in the
field of nuclear gamma cameras for use in cardiology, women's health, pediatric and other imaging and neuropathy diagnostics
applications. Previously, he has served as the Chief Executive Officer of OTI America Inc., the U.S.-based subsidiary of publicly-held
On Track Innovations Ltd., a pioneer of cashless payment technology, since December 2013. His role was to oversee and monetize
the extensive patent portfolio of over 100 U.S. and international patents. Mr. Angelis has served as a director of On Track Innovations
since December 2012, and served as its Chairman of the Board from April 2013 until February 2015. From October 2012 until December
2013, Mr. Angelis served as the General Counsel of Wockhardt Pharmaceuticals Inc., an international biologics and pharmaceutical
company. From October 2008 to October 2012, Mr. Angelis was a senior counsel at Dr. Reddy's Laboratories, Ltd., a publicly-traded
pharmaceutical company, and during 2008 he was the Chief Legal Officer and Corporate Secretary of Osteotech, Inc., a publicly-traded
medical device company, with responsibility for managing the patent portfolio of approximately 42 patents. Prior to that, Mr. Angelis
worked in the pharmaceutical industry in various corporate, strategic and legal roles. In addition, he worked for McKinsey &
Company, Merrill Lynch and the Japanese government more than five years ago. He began his legal career as a transactional associate
with the New York office of the law firm Mayer Brown. Mr. Angelis holds a B.A. degree in Philosophy and English from Boston College,
an M.A. in Behavioral Science and Negotiation from California State University and a J.D. from New York University School of Law.
The Board believes that Mr. Angelis' substantial experience as an accomplished attorney, negotiator and general counsel to
public and private companies in the healthcare field will enable him to bring a wealth of strategic, legal and business acumen
to the Board, well qualifying him to serve as a director.
Dr. Arthur M. Langer
became a member of our Board in May 2015. Dr. Langer is the Director of the Center for Technology Management, Vice Chair of Faculty
and Academic Director of the Executive Master of Science in Technology Management Program at the School of Professional Studies
at Columbia University. Dr. Langer serves on the faculty of the Department of Organization and Leadership at the Graduate School
of Education (Teachers College). He is also an elected member of the Columbia University Faculty Senate. Dr. Langer joined the
faculty at Columbia University in 1984. Dr. Langer is the author of Strategic IT: Best Practices for Managers and Executives (2013),
with Lyle Yorks), Guide to Software Development: Designing & Managing the Life Cycle (2012), Information Technology and Organizational
Learning (2011), Analysis and Design of Information Systems (2007), Applied Ecommerce (2002), and The Art of Analysis (1997), and
has numerous published articles and papers relating to service learning for underserved populations, IT organizational integration,
mentoring and staff development. Dr. Langer consults with corporations and universities on information technology, staff development,
management transformation and curriculum development around the globe. Dr. Langer is also the Chairman and Founder of Workforce
Opportunity Services, a non-profit social venture that provides scholarships and careers to underserved populations around the
world. Prior to joining the faculty at Columbia University, Dr. Langer was Executive Director of Computer Support Services at Coopers
& Lybrand, General Manager and Partner of Software Plus, and President of Macco Software more than five years ago. Dr. Langer
holds a B.A. in Computer Science, an M.B.A. in Accounting/Finance, and a Doctorate of Education from Columbia University. The Board
believes Dr. Langer's qualifications to serve on the Board include his expertise in technology management and his vast experience
within the information technology industry.
54
Robert G. Pearse
became a member of our Board in May 2015. Mr. Pearse is a Lone Star Value designee on the Board. Mr. Pearse has served as a
Managing Partner at Yucatan Rock Ventures, where he specializes in technology investments and consulting, since August 2012. Mr.
Pearse has served as Chairman of the Board of Directors of Crossroads Systems, Inc. since May 2016, also serving as the Chairman
of its Compensation Committee and as a member of its Audit Committee and Nomination and Governance Committee since July 2013. Mr.
Pearse serves as a director for Novation Companies, Inc., also serving as the Chairman of its Compensation Committee and as a member
of its Audit Committee since January 2015. Previously, Mr. Pearse served as a director for Aviat Networks, Inc., including as a
member of its Compensation Committee and its Nominating and Governance Committee, from January 2015 to November 2016. From 2005
to 2012, Mr. Pearse served as vice president of Strategy and Market Development at NetApp, Inc., a computer storage and data management
company. From 1987 to 2004, Mr. Pearse held leadership positions at Hewlett-Packard Inc., most recently as the vice president of
Strategy and Corporate Development from 2001 to 2004. Mr. Pearse's professional experience also includes positions at PricewaterhouseCoopers
LLP, Eastman Chemical Company and General Motors Company. Mr. Pearse earned an M.B.A. degree from the Stanford Graduate School
of Business and a B.S. degree in Mechanical Engineering from the Georgia Institute of Technology. The Board believes Mr. Pearse's
qualifications to serve on the Board include his extensive business development and financial expertise and his extensive background
in the technology sector.
Dhruwa N. Rai
became
a member of our Board and also began serving as our in-house management consultant in May 2016. Mr. Rai served as the Global Vice
President of Industrial Coatings at Axalta Coatings Systems Ltd. ("Axalta" and formerly DuPont Performance Coatings),
one of the largest coating companies in the world, from December 2014 to August 2015. Mr. Rai joined Axalta in February 2013 as
the Vice President of Business Processes and Chief Information Officer, where he led its business process and IT transformation,
including its separation from E. I. du Pont de Nemours and Company (d/b/a DuPont). From March 2012 to January 2013, Mr. Rai served
as the Chief Information Officer of The Williams Companies, Inc., an energy infrastructure company. From June 2009 to December
2011, Mr. Rai served as the Chief Information Officer and Vice President of Momentive Performance Materials Inc. (formerly GE Advanced
Materials), a manufacturer of specialty materials for diverse industrial applications, where he led its divestiture from General
Electric Co. ("General Electric"). Mr. Rai also served as a director of FCS Software Solutions Ltd., an IT service
provider, from April 2008 to September 2010. Mr. Rai's prior professional experience also includes leadership positions with
GE Security, a former division of General Electric that was acquired by United Technologies Corporation; Delphi Automotive PLC,
a leading global supplier of technologies for the automotive and commercial vehicle market; and Ernst & Young LLP. Mr. Rai
holds a Bachelor of Engineering degree in Production Engineering from G.B. Pant University (India) and an M.B.A. from the University
of Connecticut. The Company believes that Mr. Rai's leadership experience with global public companies and his expertise
in the IT and technology sectors qualify his to serve on the Board.
Venkatraman
Balakrishnan
became a member of our Board in June 2016. He is the Founder and Chairman of Exfinity Venture Partners,
a venture capital fund focused on investing in emerging technologies, which was founded in 2013. Mr. Balakrishnan served on
the board of directors of Infosys Limited, an IT services and consulting company, from June 2011 to December 2013. He also
served as the head of the BPO, Finacle and India business unit at Infosys Limited, and served as the Chief Financial Officer
of Infosys Limited from May 2006 to October 2012. Mr. Balakrishnan is currently the Chairman of the Board of Tejas Networks
Limited (formerly Tejas Networks India Limited), an Indian computer networking and telecommunications products company, and
as the Chairman of Micrograam, a peer-to-peer lending platform that empowers rural entrepreneurs with access to loans from
socially minded investors, Mr. Balakrishnan is also a trustee of Akshaya Patra Foundation, a non-governmental
organization that provides mid-day meals to millions of children across India. Mr. Balakrishnan received a Bachelor of
Science degree from the University of Madras and is an Associate Member of the Institute of Chartered Accountants of India,
the Institute of Company Secretaries of India and the Institute of Cost and Works Accountants of India. The Company believes
that Mr. Balakrishnan's significant experience in leadership positions with technology services and consulting
companies, as well as his expertise with corporate finance domain, qualifies him to serve on the Board.
55
All directors hold
office until the expiration of their respective term, in 2016, 2017 or 2018, at each year's annual meeting of stockholders
and the election and qualification of their successors. Officers are elected annually by the Board and serve at the discretion
of the Board.
Our previous Chief
Financial Officer, Edward O'Donnell, departed from our company on December 2, 2016 to pursue new opportunities. At that time,
Carlos Fernandez, our former Executive Vice President of Corporate Development, was appointed as our interim Chief Financial Officer
while we conducted a search for a permanent Chief Financial Officer. Our current Chief Financial Officer, Viraj Patel, was appointed
effective April 24, 2017. Mr. Fernandez and Srirangan Rajagopal, our former Executive Vice President – Head of Marketing
and Strategic Initiatives, both resigned their positions with the Company, effective as of July 28, 2017. Mr. Fernandez and Mr.
Rajagopal had served in their positions with the Company since the Merger in May 2015.
Advisory Board
The Company's
Advisory Board (the "Advisory Board"), which advises the Board and management on business opportunities and strategy
of the Company, is comprised of the following individuals:
Robert Rosenberg
was a member of our Board from May 2015 to June 2016. In June 2016, Mr. Rosenberg resigned from our Board and was appointed to
the Advisory Board. Mr. Rosenberg is the director of entrepreneurship programs at the Polsky Center for Entrepreneurship and Innovation
and adjunct associate professor of entrepreneurship at Chicago Booth since 2000. He has served in a variety of senior administrative
roles at the University of Chicago, most recently as associate vice president for marketing strategy and associate vice president
for research. Mr. Rosenberg came to the University of Chicago in 1989 as director of industrial relations and technology at the
University of Chicago Medical Center. Mr. Rosenberg was a founder of the Illinois Biotechnology Industry Organization and the Midwest
Research University Network. He is a director of Illinois' Technology Development Fund, a board member of Manufacturing Renaissance
and Fortify, and a co-chair of Hyde Park Angels Healthcare Ambassador Circle. Mr. Rosenberg earned a B.A. degree in English from
Harvard University, a master's degree in English literature from Tufts University, and an M.B.A. from the University of Chicago
Booth School of Business. The Board believes that Mr. Rosenberg's qualifications to serve on the Board include his background
and expertise in entrepreneurship.
Matt Stultz
was
appointed to the Advisory Board in November 2016. Mr. Stultz has extensive leadership and management experience in large scale
ERP implementations, technology centralization and shared services, solution and application architecture, and financial/budget
management planning. Currently, Mr. Stultz is Senior Vice President and General Manager, Retail and Fashion Services for North
America, at SAP, a multinational enterprise software company. He has worked for several Fortune 500 companies including SAP, Nike,
The Home Depot, Newell Rubbermaid, Honeywell, Olin Corporation, and Microsoft. Mr. Stultz serves on the LinkedIn Social Executive
Council for Facebook, Twitter, and LinkedIn Integration Initiatives. He is also on the LinkedIn TechExecs and CIO Forum Councils.
Jim Shad
was
appointed to the Advisory Board in November 2016. Mr. Shad is a seasoned executive with 38 years of experience in a diverse set
of industries spanning consumer products, health care, consumer electronics, major appliances and housing. He is currently Principal
of Renaissance Growth Consultants. In 2013, Mr. Shad served as the President of C3 Design, a small start-up in the housing sector.
From 2009 to 2012, Mr. Shad served as Viking's Chief Revenue Officer. From 2003 to 2009, he served as LG USA's President
and Chief Executive Officer. From 2000 to 2003, he was the Global Chief Customer Officer for Novartis' Consumer Health Division.
Mr. Shad began his career as a territory salesman with Procter and Gamble in 1979, rising to the head of North American Market
Strategy in 2000. Mr. Shad recently served as an advisory board member to Precipio Corporation and currently serves on the advisory
board at Babel St. Corporation. He guest lectures on Leadership and Business Strategy at the University of Georgia Terry College
of Business Executive MBA program. Mr. Shad earned a B.A. degree in business from the University of Georgia.
56
Joyce Cruickshank
was appointed to the Advisory Board in November 2016. Ms. Cruickshank is currently the Business Solutions Officer for Amtrak
Operations, Northeast Corridor Infrastructure and Investment, Americas Railroad. Prior to joining Amtrak, Ms. Cruickshank was the
acting Chief Information Officer and Chief Technology Officer at Corizon Health and worked at AOL/Time Warner for eleven years
starting as a Portfolio Director and ending her career as a VP of Technology for the largest revenue division within AOL. In addition,
Ms. Cruickshank held leadership roles in five start-ups in industries including online banking, e-commerce and telecommunications.
Ms. Cruickshank is a co-chair of the Capital area Corporate Council for the American Cancer Society and has held previous board
positions in other non-profits. Ms. Cruickshank earned an undergraduate degree from West Virginia Wesleyan.
Marius van Gijlswijk
was appointed to the Advisory Board in November 2016. Mr. van Gijlswijk was a principal of Ameri Arizona until we acquired
it in July 2016. Before founding Ameri Arizona, Mr. van Gijlswijk was Chief Operating Officer and Chief Financial Officer of a
Silicon Valley internet startup. Mr. van Gijlswijk has over 28 years of SAP experience. He has served in various global project
leadership positions and has consulted extensively in the area of Logistics, System Integration and Technical Architecture, and
has worked with such consulting firms as Deloitte and BearingPoint. He has a master's degree in Applied Mathematics and Computer
Science from Technical University Eindhoven (Netherlands).
Board Independence
The Board of Directors
has determined that Dimitrios J. Angelis, Dr. Arthur M. Langer, Jeffrey E. Eberwein, Robert Pearse and Venkatraman Balakrishnan
are "independent," as independence is defined in the listing standards for The Nasdaq Stock Market. The Nasdaq independence
definition includes a series of objective tests, such as that the director is not, and has not been for at least three years, one
of our employees and that neither the director, nor any of his family members has engaged in various types of business dealings
with us. In addition, as provided by the Nasdaq rules, our Board has made a subjective determination as to each independent director
that no relationships exist which, in the opinion of our Board, would interfere with the exercise of independent judgment in carrying
out the responsibilities of a director. In making these determinations, our Board reviewed and discussed information provided by
the directors and us with regard to each director's business and personal activities and relationships as they may relate
to us and our management.
Board Committees
The standing committees
of our board of directors currently consists of an Audit Committee, Compensation Committee and a Nominations and Corporate Governance
Committee. Each of the committees report to Board as they deem appropriate and as the Board may request. The composition, duties
and responsibilities of these committees are set forth below.
Audit Committee
.
The
Audit Committee consists of Messrs. Angelis, Pearse and Balakrishnan, with Mr. Balakrishnan serving as chairman. All members
of the Audit Committee are (i) independent directors (as currently defined in Rule 5605(a)(2) of the Nasdaq listing rules);
(ii) meet the criteria for independence set forth in Rule 10A-3(b)(1) under the Exchange Act; (iii) not have participated
in the preparation of the financial statements of the Company or any current subsidiary of the Company at any time during the past
three years; and (iv) are able to read and understand fundamental financial statements. Mr. Angelis qualifies as an "Audit
Committee financial expert" as defined in the rules and regulations established by the SEC. The Audit Committee is governed
by a written charter approved by our Board of Directors. The functions of the Audit Committee include, among other things:
·
Meeting with our management periodically to consider the adequacy of our internal controls and
the objectivity of our financial reporting;
·
Meeting with our independent registered public accounting firm and with internal financial personnel
regarding the adequacy of our internal controls and the objectivity of our financial reporting;
57
·
Recommending to our Board of Directors the engagement of our independent registered public accounting
firm;
·
Reviewing our quarterly and audited consolidated financial statements and reports and discussing
the statements and reports with our management, including any significant adjustments, management judgments and estimates, new
accounting policies and disagreements with management; and
·
Reviewing our financial plans and reporting recommendations to our full Board of Directors for
approval and to authorize action.
Both our independent
registered public accounting firm and internal financial personnel regularly meet privately with our Audit Committee and have unrestricted
access to the Audit Committee.
Compensation
Committee
. The Compensation Committee consists of Messrs. Eberwein, Langer and Pearse, with Mr. Pearse serving as
chairman. Messrs. Eberwein, Langer and Pearse are independent (as currently defined in Rule 5605(a)(2) of the Nasdaq listing rules),
SEC and Internal Revenue Service qualification requirements. The Compensation Committee is governed by a written charter approved
by our Board of Directors. The charter of the Compensation Committee permits the Compensation Committee to engage outside consultants
and to consult with our human resources department when appropriate to assist in carrying out its responsibilities. Compensation
consultants have not been engaged by the Company to recommend or assist in determining the amount or form of compensation for any
current executive officers or directors of the Company. The Committee may also obtain advice and assistance from internal or external
legal, accounting, or other advisers selected by the Committee. The functions of the Compensation Committee include, among other
things:
·
Reviewing and, as it deems appropriate, recommending to our Board of Directors, policies, practices,
and procedures relating to the compensation of our directors, officers and other managerial employees and the establishment and
administration of our employee benefit plans;
·
Establishing appropriate incentives for officers, including the Chief Executive Officer, to encourage
high performance, promote accountability and adherence to company values and further our long-term strategic plan and long-term
value; and
·
Exercising authority under our employee benefit plans.
Corporate Governance
Committee
. The Nominations and Corporate Governance Committee consists of Messrs. Angelis, Eberwein and Balakrishnan, with
Mr. Angelis serving as chairman. Messrs. Eberwein, Angelis and Balakrishnan are independent directors (as currently defined
in Rule 5605(a)(2) of the Nasdaq listing rules). The Nominations and Corporate Governance Committee is governed by a written charter
approved by our Board of Directors. The functions of the Nominations and Corporate Governance Committee include, among other things:
·
Reviewing and recommending nominees for election as directors;
·
Assessing the performance of our board of directors;
·
Developing guidelines for the composition of our board of directors;
·
Reviewing and administering our corporate governance guidelines and considering other issues relating
to corporate governance; and
·
Oversight of the Company compliance officer and compliance with the Company's Code of Ethics
and Business Conduct and Code of Ethics for our Chief Executive Officer and Senior Financial Officers.
Code of Ethics
We have adopted a Code
of Ethics that applies to all of our employees, including our chief executive officer, chief financial officer and principal accounting
officer. Our Code of Ethics is available on our website at www.ameri100.com. If we amend or grant a waiver of one or more of the
provisions of our Code of Ethics, we intend to satisfy the requirements under Item 5.05 of Form 8-K regarding the disclosure
of amendments to or waivers from provisions of our Code of Ethics that apply to our principal executive officer, principal financial
officer and principal accounting officer by posting the required information on our website at the above address. Our website is
not part of this prospectus.
58
Family Relationships
Giri Devanur, our President,
Chief Executive Officer and a member of our Board, and Srinidhi "Dev" Devanur, our Executive Vice Chairman and a member
of our Board, are brothers. Ram Ramanan and Saravanan Swaminathan, who manage Ameri Georgia, are brothers. Other than these individuals,
there are no family relationships among our directors and executive officers.
Involvement in Certain Legal Proceedings
Lone Star Value Management
LLC and our director Jeffrey Eberwein are each subject to a SEC administrative order, dated February 14, 2017 (Securities Exchange
Act Release No. 80038), relating to alleged violations of Section 13(d) of the Exchange Act and the rules promulgated thereunder,
including failing to disclose the members of a stockholder group, and further allegations that Mr. Eberwein violated Section 16(a)
of the Exchange Act and the rules promulgated thereunder, including failing to timely file initial statements of beneficial ownership
on Form 3 and changes thereto on Form 4. Without admitting or denying any violations, (i) Lone Star Value Management agreed to
cease and desist from committing or causing any violations of Section 13(d) of the Exchange Act and Rules 13d-1 and 13d-2 promulgated
thereunder, and paid a civil penalty of $120,000 to the SEC and (ii) Mr. Eberwein agreed to cease and desist from committing or
causing any violations of (x) Section 13(d) of the Exchange Act and Rules 13d-1 and 13d-2 promulgated thereunder and (y) Section
16(a) of the Exchange Act and Rules 16a-2 and 16a-3 promulgated thereunder, and paid a civil penalty to the SEC in the amount of
$90,000.
59
Executive
Compensation
Elements of Executive
Compensation
Our executive compensation
consists of the following elements:
·
Base salary;
·
Annual Incentive Bonus;
·
Long-Term Incentives; and
·
Retirement benefits under a 401(k) plan and generally available benefit programs.
Base Salary
.
The
base salary for each executive is initially established through negotiation at the time the executive is hired, taking into account
his or her scope of responsibilities, qualifications, experience, prior salary, and competitive salary information within our industry.
Year-to-year adjustments to each executive officer's base salary are determined by an assessment of his or her sustained
performance against individual goals, including leadership skills and the achievement of high ethical standards, the individual's
impact on our business and financial results, current salary in relation to the salary range designated for the job, experience,
demonstrated potential for advancement, and an assessment against base salaries paid to executives for comparable jobs in the marketplace.
Based on the factors
discussed above, base salaries of our Chief Executive Officer and our two other most highly compensated executive officers ("Named
Executive Officers") as of December 31, 2016 (on an annualized basis) were as follows:
Giri Devanur's
2016 base salary was set at $120,000, which represented no change from 2015. However, effective November 14, 2016, Mr. Devanur's
annual base salary was raised to $220,000.
Srirangan Rajagopal's
2016 base salary was set at $144,000, which represented no increase from 2015.
Carlos Fernandez's
2016 base salary was set at $141,600, which represented no increase from 2015.
Annual Bonus
.
Annual bonus payments under our executive employment agreements are based on the discretion of our Board of Directors. We believe
that such bonuses provide our executives with an incentive to achieve goals that are aligned with our stockholders' interests,
with the achievement of such goals being measurable in terms of revenue and income or other financial objectives. An executive
officer's failure to achieve measurable performance goals can affect his or her bonus amount. We believe that offering significant
potential income in the form of bonuses allows us to attract and retain executives and to align their interests with those of our
stockholders.
The maximum bonus Mr.
Devanur could have achieved under his employment agreement in the year ended December 31, 2016 was $110,000 (on an annualized basis).
As of December 31, 2016, a bonus of $57,500 had accrued but not yet been paid to our President and Chief Executive Officer, Giri
Devanur. Mr. Devanur's accrued bonus for 2016 was canceled as of June 30, 2017 and was no longer owed to Mr. Devanur.
Long-Term Incentives
.
The Compensation Committee has the ability to grant equity instruments to our executives under our 2015 Equity Incentive Award
Plan. The Compensation Committee has the ability to issue a variety of instruments, but equity grants will typically be in the
form of stock options and restricted stock units. We believe that our executive compensation program must include long-term incentives
such as stock options and restricted stock units if we wish to hire and retain high-level executive talent. We also believe that
stock options and restricted stock units help to provide a balance to the overall executive compensation program as base salary
and bonus awards focus only on short-term compensation. In addition, the vesting period of stock options and restricted stock units
encourages executive retention and the preservation of stockholder value. Finally, we believe that aligning at least a portion
of restricted stock units vesting provisions to financial performance measures further aligns executive compensation to stockholder
value; if performance targets are not achieved, then the awards do not vest. We base the number of equity units granted on the
type and responsibility level of the executive's position, the executive's performance in the prior year and the executive's
potential for continued sustained contributions to our long-term success and the long-term interests of our stockholders.
60
401(k) and Other
Benefits
. During 2016, our executive officers were eligible to receive certain benefits generally available to all our
employees on the same terms, including medical, dental and vision insurance, long-term and short-term disability insurance, life
and accidental death and dismemberment insurance, health and dependent care flexible spending accounts, educational and employee
assistance, paid-time-off, and certain other benefits. During 2015, we also maintained a tax-qualified 401(k) Plan, which provides
for broad-based employee participation. During 2016, under the 401(k) Plan, all employees were eligible to receive matching contributions
from Ameri of (i) 100% of their first 3% of employee contributions and (ii) 50% of the next 2% of employee contributions up to
an aggregate maximum of $10,600 per employee, per year, subject to vesting provisions.
Compensation Risk Assessment
In establishing and
reviewing our overall compensation program, the Compensation Committee considers whether the program and its various elements encourage
or motivate our executives or other employees to take excessive risks. We believe that our compensation program and its elements
are designed to encourage our employees to act in the long-term best interests of the Company and are not reasonably likely to
have a material adverse effect on our business.
The Impact of Tax and Accounting Treatments
on Elements of Compensation
We have elected to
award non-qualified stock options instead of incentive stock options to all our employees, directors and consultants to allow the
corporation to take advantage of the more favorable tax advantages associated with non-qualified stock options.
Internal Revenue Code
Section 162(m) precludes us from deducting certain forms of non-performance-based compensation in excess of $1.0 million to
named executive officers. To date, we have not exceeded the $1.0 million limit for any executive, and the Compensation Committee
has not defined a policy that all compensation must be deductible. However, since stock-based awards comprise a significant portion
of total compensation, the Compensation Committee has taken appropriate steps to preserve deductibility for such awards in the
future, when appropriate.
Summary Compensation
Table
The following table
provides information regarding the compensation earned during the years ended December 31, 2016 and December 31, 2015 by our Named
Executive Officers.
Name & Principal Position
Transition Period or Fiscal Year Ended
Salary
($)
Bonus
($)
Stock Awards
($)
Option Awards
($)
Non-Equity Incentive Plan Compensation
($)
Non-Qualified Deferred Compensation
Earnings
($)
All Other Compensation
($)
Total
($)
Giri Devanur
(1)
President and Chief Executive Officer
12/31/2016
12/31/2015
175,000
147,500
57,500
45,000
—
—
—
—
—
—
—
—
—
—
232,500
192,500
Srirangan Rajagopal
(2)
Executive Vice President – Head of Marketing
and Strategic Initiatives
12/31/2016
12/31/2015
144,000
143,000
—
9,000
—
—
—
—
—
—
—
—
—
—
144,000
152,000
Carlos Fernandez
(3)
Executive Vice President – Corporate Development
12/31/2016
12/31/2015
141,600
141,600
—
—
—
—
—
—
—
—
—
—
—
—
141,600
141,600
Edward O'Donnell
(4)
Former Chief Financial Officer
12/31/2016
12/31/2015
175,000
—
—
—
—
—
—
—
—
—
—
—
—
—
175,000
—
61
(1)
Giri Devanur was appointed to his position with our company on May 26, 2015 and
    served as Chief Executive Officer of Ameri and Partners. As of December 31, 2016, a bonus of $57,500 had accrued but not yet
    been paid to our President and Chief Executive Officer, Giri Devanur. Mr. Devanur's bonus was canceled as of June 30,
    2017 and was no longer owed to Mr. Devanur.
(2)
Srirangan Rajagopal was appointed to his position with our company on May 26, 2015 and served as Executive Vice President – Head of Marketing and Strategic Initiatives until July 28, 2017.
(3)
Carlos Fernandez was appointed as our Executive Vice President – Corporate Development and Secretary on May 26, 2015 and served in such position until July 28, 2017.  Mr. Fernandez also served as our interim Chief Financial Officer from December 8, 2016 to April 24, 2017, as well as Executive Vice President – Corporate Development of Ameri and Partners until his departure from the Company on July 28, 2017.
(4)
Edward O'Donnell served as our Chief Financial Officer from January 27, 2016 through December 8, 2016.
We entered into employment
agreements with Giri Devanur and Srinidhi "Dev" Devanur effective at the closing of the Merger. The employment agreements
appoint Giri Devanur as our President and Chief Executive Officer and Srinidhi "Dev" Devanur as our executive Vice
Chairman of the Board until May 26, 2018. Each of the employment agreements provide that each executive will receive an annual
salary of $120,000 per year, with a bonus for each of $50,000 per year, to be paid at the discretion of the Board. The employment
agreements incorporate the terms of our confidentiality and non-competition agreement, which contain covenants (a) restricting
the executive from engaging in any activity competitive with our business during the term of the employment agreement and for a
period of two years thereafter, (b) prohibiting the executive from disclosing confidential information regarding us at any time,
and (c) soliciting our employees, customers and prospective customers during the term of the employment agreement and for a period
of two years thereafter.
On November 9, 2016,
the Compensation Committee of the Board approved an increase in the base salary of our President and Chief Executive Officer, Giri
Devanur, to $220,000 per year, effective as of November 14, 2016. The Compensation Committee also approved Mr. Devanur's
eligibility to earn a bonus of up to 50% of his annual base salary, as determined in the discretion of the Compensation Committee
upon Mr. Devanur's satisfaction of criteria to be determined by the Compensation Committee.
Equity
Awards
As of December 31,
2016, we had not granted any equity awards to, nor were any equity awards outstanding with respect to, our Named Executive Officers.
Pension Benefits
None of our Named Executive
Officers participates in or has account balances in qualified or non-qualified defined benefit plans sponsored by us.
Nonqualified Deferred
Compensation
None of our Named Executive
Officers participates in or has account balances in non-qualified defined contribution plans or other deferred compensation plans
maintained by us.
62
Potential Payments
Upon
Termination or Change of Control
Under Employment Agreements
We entered into employment
agreements with Giri Devanur and Srinidhi "Dev" Devanur in May 2015. The employment agreements appointed Giri Devanur
as our President and Chief Executive Officer and Srinidhi "Dev" Devanur as our executive Vice Chairman of the Board
for three years. The employment agreements provide that if, during the term of their employment, they are terminated by us other
than for "Cause" or they resign for "Good Reason," then they will continue to receive for a period of one
year following such termination their then current salary payable on the same basis as they were then being paid. Termination for
"Cause" means: (i) deliberate refusal or deliberate failure to carry out any reasonable order, consistent with their
position, of our Board of Directors after reasonable written notice; (ii) a material and willful breach of the employment agreement,
their confidentiality and non-competition agreement or similar agreements with us; (iii) gross negligence or willful misconduct
in the execution of their assigned duties; (iv) engaging in repeated intemperate use of alcohol or drugs; or (v) conviction of
a felony or other serious crime. "Good Reason" means (i) they shall have been assigned duties materially inconsistent
with their position; (ii) their salary is reduced more than 15% below its then current level; or (iii) material benefits and compensation
plans then currently in existence are not continued in effect for their benefit.
If either of Messrs.
Devanur would have been terminated without cause at December 31, 2016 or if either of them would have resigned for good reason,
then Giri Devanur would have been entitled to receive a severance payment of $220,000 and Srinidhi Devanur would have been entitled
to receive a severance payment of $120,000.
Securities Authorized for Issuance Under Equity Compensation
Plans
On April 20, 2015,
our Board and the holder of a majority of our outstanding shares of common stock approved the adoption of our 2015 Equity Incentive
Award Plan (the "Plan") and a grant of discretionary authority to the executive officers to implement and administer
the Plan. The Plan allows for the issuance of up to 2,000,000 shares of our common stock for award grants (all of which can be
incentive stock options). The Plan provides equity-based compensation through the grant of cash-based awards, nonqualified stock
options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance
units and other stock-based awards. As of December 31, 2016, restricted stock units for the issuance of 590,869 shares of common
stock and options to purchase 972,700 shares of our common stock had been granted and were outstanding. The Board of Directors
adopted the Plan to provide a means by which our employees, directors, officers and consultants may be granted an opportunity to
purchase our common stock, to assist in retaining the services of such persons, to secure and retain the services of persons capable
of filling such positions and to provide incentives for such persons to exert maximum efforts for our success.
Administration of
the Plan
. The Plan is to be administered by the Compensation Committee consisting of two or more directors who are "non-employee
directors" within the meaning of Rule 16b-3, and "outside directors" within the meaning of Section 162(m) of
the Code. In the event that for any reason the Compensation Committee is unable to act or if the Compensation Committee at the
time of any grant, award or other acquisition under the Plan does not consist of two or more "non-employee directors,"
or if there is no such committee, then the Plan will be administered by the Board of Directors, except to the extent such Board
of Directors action would have adverse consequences under Section 16(b) of the Securities Exchange Act or Code Section 162(m).
Subject to the other
provisions of the Plan, the Compensation Committee will have the authority, in its discretion: (i) to grant cash-based awards,
nonqualified stock options, incentive stock options, SARs, restricted stock, restricted stock units, performance shares, performance
units and other stock-based awards, all of which are referred to collectively as "Awards"; (ii) to determine the terms
and conditions of each Award granted (which need not be identical); (iii) to interpret the Plan and all Awards granted thereunder;
and (iv) to make all other determinations necessary or advisable for the administration of the Plan.
Eligibility
.
The persons eligible for participation in the Plan as recipients of Awards include employees, consultants and directors to our
company or any subsidiary or affiliate of our company. In selecting participants, and determining the number of shares of common
stock covered by each Award, the Compensation Committee may consider any factors that it deems relevant.
63
Shares Subject to
the Plan
. Subject to the conditions outlined below, the total number of shares of common stock which may be issued pursuant
to Awards granted under the Plan may not exceed 2,000,000 shares of common stock. The Plan provides for annual limits on the size
of Awards for any particular participant.
In the event of certain
corporate events or transactions (including, but not limited to, the sale of all, or substantially all, of our assets or a change
in our shares or capitalization), the Compensation Committee, in its sole discretion, in order to prevent dilution or enlargement
of a participant's rights under the Plan, will substitute or adjust, as applicable, and subject to certain Code limitations,
the number and kind of shares of common stock that may be issued under the Plan or under particular forms of Awards, the number
and kind of shares of common stock subject to outstanding Awards, the option price or grant price applicable to outstanding Awards,
the annual Award limits, and other value determinations applicable to outstanding Awards.
Options
. An
option granted under the Plan is designated at the time of grant as either an incentive stock option or as a non-qualified stock
option. Upon the grant of an option to purchase shares of common stock, the Compensation Committee will specify the option price,
the maximum duration of the option, the number of shares of common stock to which the option pertains, the conditions upon which
an option will become vested and exercisable, and such other provisions as the Compensation Committee will determine which are
not inconsistent with the terms of the Plan. The purchase price of each share of common stock purchasable under an option will
be determined by the Compensation Committee at the time of grant, but may not be less than 100% of the fair market value of such
share of common stock on the date the option is granted. No option will be exercisable later than the sixth anniversary date of
its grant.
Stock Appreciation
Rights
. Stock Appreciation Rights ("SARs"), which may be issued in tandem with options or be freestanding, will
be exercisable at such time or times and subject to such terms and conditions as determined by the Compensation Committee. The
term of SARs granted under the Plan will be determined by the Compensation Committee, in its sole discretion, and except as determined
otherwise by the Compensation Committee, no stock appreciation right will be exercisable later than the sixth anniversary date
of its grant.
Restricted Stock
and Restricted Stock Units
. Shares of restricted stock and/or restricted stock units may be granted under the Plan aside from,
or in association with, any other Award and will be subject to certain conditions and contain such additional terms and conditions,
not inconsistent with the terms of the Plan, as the Compensation Committee deems desirable.
Cash-Based Awards
and Other Stock-Based Awards
. Subject to the provisions of the Plan, the Compensation Committee may grant cash-based awards
or other types of equity-based or equity-related awards not otherwise described by the terms of the Plan (including the grant or
offer for sale of unrestricted shares of common stock) in such amounts and subject to such terms and conditions, as the Compensation
Committee will determine. Such Awards may involve the transfer of actual shares of common stock to participants, or payment in
cash or otherwise of amounts based on the value of shares of common stock. Each cash-based award will specify a payment amount
or payment range as determined by the Compensation Committee.
Repricing of Options
.
The Compensation Committee may not "reprice" any Stock Option. "Reprice" means any of the following or
any other action that has the same effect: (i) reducing the per share exercise price of the shares subject to an option below the
per share exercise price as of the date the option is granted and, (ii) except for adjustment for stock splits, stock dividends,
reorganizations and similar events, granting in exchange for, or in connection with, the cancellation or surrender of an option
having a higher per share exercise price.
Restrictions on
Transferability
. The Awards granted under the Plan are not transferable and may be exercised solely by a participant or his
authorized representative during his lifetime or after his death by the person or persons entitled thereto under his will or the
laws of descent and distribution or his designation of beneficiary or as otherwise required by law. Any attempt to transfer, assign,
pledge or otherwise dispose of, or to subject to execution, attachment or similar process, any Award contrary to the provisions
set forth in the Plan will be void and ineffective and will give no right to the purported transferee.
64
Change in Control
.
The Compensation Committee may provide for the acceleration of the vesting and exercisability of outstanding options, vesting of
restricted stock and restricted stock units and earlier exercise of freestanding SARs, in the event of a Change in Control of our
company. However, if the Compensation Committee takes no action at the time of the Change in Control, and the initial Award does
not otherwise specify, accelerated vesting and exercisability is contingent upon termination of employment by us or by the participant
for Good Reason within two years of the Change in Control.
Termination of the
Plan
. Unless sooner terminated as provided therein, the Plan will terminate six years from April 20, 2015, the date the Plan
was approved by stockholders. The termination of the Plan will not adversely affect any Awards granted prior to Plan termination.
Amendments to the
Plan
. The Compensation Committee may at any time alter, amend, modify, suspend or terminate the Plan and any evidence of Award
in whole or in part; provided, however, that, without the prior approval of our stockholders, options issued under the Plan to
any individual will not be repriced, replaced, or regranted through cancellation, and no amendment of the Plan will be made without
stockholder approval if stockholder approval is required by law, regulation, or stock exchange rule; and except where required
by tax law, without the prior written consent of the participant, no modification will adversely affect an Award under the Plan.
The Compensation Committee can not issue any Awards while the Plan is suspended.
The following table
sets forth information regarding our equity compensation plans as of December 31, 2016:
Plan Category
Number of securities to be issued upon exercise of outstanding options, warrants and rights
Weighted-average exercise price of outstanding options, warrants and rights
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
(a)
(b)
(c)
Equity compensation plans approved by security holders
1,563,569
$
2.67
436,431
Warrants issued outside of our equity compensation plan
2,666,666
1.80
—
Total
4,230,235
$
1.89
436,431
Compensation
o
f
Directors
Directors are expected
to timely and fully participate in all regular and special board meetings, and all meetings of committees that they serve on. We
compensate non-management directors through an annual grant of stock options and/or restricted stock units pursuant to the Plan.
Such option awards have an exercise price not less than 100% of the fair market value of our common stock, based on the value of
such shares of common stock on the date the option is granted, and both the option and restricted stock unit awards become vested
and exercisable as determined by the compensation committee or the entire Board. Other terms and conditions of the option and restricted
stock unit grants are on the terms and conditions as determined by the Compensation Committee or the entire Board when the options
or restricted stock units are granted.
65
The following table
sets forth the cash compensation, as well as certain other compensation granted to each person who served as a director of our
company, during the twelve months ended December 31, 2016:
Name
Fees Earned or Paid in Cash
Stock Awards
RSU & Option Awards
All Other
Compensation
Total
($)
($)
($)
($)
($)
Jeffrey E. Eberwein
—
—
—
—
—
Srinidhi "Dev" Devanur
—
—
—
—
—
Giri Devanur
—
—
—
—
—
Dimitrios J. Angelis
—
—
—
—
—
Dr. Arthur M. Langer
—
—
—
—
—
Robert G. Pearse
—
—
—
—
—
Dhruwa N. Rai
(1)
—
—
7,000,000
—
7,000,000
Venkatraman Balakrishnan
(2)
—
—
212,747
—
212,747
TOTAL
—
—
7,212,747
—
7,212,747
(1)
Includes an option to purchase 500,000 shares of common stock granted on May 10, 2016, valued at $7.00 per share, and restricted stock units for 500,000 shares of common stock granted on May 10, 2016, valued at $7.00 per share. On May 9, 2017, Mr. Rai and the Company agreed to cancel 166,667 of the restricted stock units.
(2)
Includes an option to purchase 25,000 shares of common stock granted on June 28, 2016, valued at $6.51 per share, and restricted stock units for 7,680 shares of common stock granted on June 28, 2016, valued at $6.51 per share.  On June 13, 2017, Mr. Balakrishnan and the Company agreed to cancel all of the restricted stock units.
66
Certain
Relationships and Related Transactions
Lone Star Value
Prior to the Merger,
LSVI and its affiliates, collectively, was our majority stockholder, and each of our directors and sole officers was an officer
of Lone Star Value Management, LLC. On January 15, 2014, our predecessor entity, Spatializer Audio Laboratories, Inc., issued 3,267,974
shares of common stock to Lone Star Value, an entity ultimately controlled by Jeffrey E. Eberwein, who was a director at the time
of the transaction at $0.0153 per share for total proceeds of $50,000 (and such shares became 185,575 shares of our common stock
as a result of the 1-for-17.61 reverse stock split of our outstanding shares of common stock that occurred contemporaneously with
the Merger in May 2015).
On April 17, 2015,
we issued a promissory note in the principal amount of $50,000 to LSVI. Under the terms of the promissory note, interest on the
outstanding principal amount accrues at a rate of 10% per annum, and all amounts outstanding under this promissory note are due
and payable on or before April 30, 2020. We intend to use the proceeds for legal and operating expenses.
On May 26, 2015, we
issued the Convertible Note in the principal amount of $5,000,000 bearing interest at 5% per annum, maturing on May 26, 2017 and
at a conversion price of $1.80 per share, or an aggregate of 2,777,778 shares of common stock, together with the Original Warrant
to purchase up to 2,777,777 shares of our common stock, at an exercise price equal to $1.80 per share, in the Private Placement
to LSVI, pursuant to the terms of a Securities Purchase Agreement. In connection with the Private Placement, LSVI was granted the
right to designate three of our eight directors.
On May 13, 2016, LSVI
completed an early partial exercise of the Original Warrant for 1,111,111 shares of our common stock for total consideration to
us of $2,000,000, and LSVI was issued a replacement warrant for the remaining 1,166,666 shares under the Original Warrant. LSVI
also agreed to amend the Convertible Note to extend its maturity for two years in exchange for (i) the right to request that we
expand the size of the Board to nine directors from the current eight, with LSVI having the right to designate up to four of the
nine directors and (ii) the issuance of the Additional Warrant for the purchase of 1,000,000 shares of our common stock at a price
of $6.00 per share. LSVI's Registration Rights Agreement, dated May 26, 2015, with us was also amended and restated to include
the shares of common stock issuable under the Additional Warrant.
On December 30, 2016,
we entered into the Exchange Agreement with LSVI, pursuant to which the Convertible Note was returned to the Company and cancelled
in exchange for 363,611 shares of the Company's Series A Preferred Stock, which is non-convertible and perpetual preferred
stock of the Company. As a result of the exchange transaction, no principal or interest remained outstanding or payable under the
Convertible Note and the Convertible Note was no longer convertible into shares of our common stock.
Purchase Agreement
On April 20, 2016,
we entered into a Stock Purchase Agreement with Dhruwa N. Rai, pursuant to which Mr. Rai purchased from us 500,000 shares of our
common stock, par value $0.01 per share, at a price per share of $6.00 for an aggregate purchase price of $3,000,000 and we issued
500,000 unregistered shares of common stock to Mr. Rai.
Ameri India
On
September 1, 2016, we issued 299,250 shares of common stock to Srinidhi "Dev" Devanur, our Executive Chairman, in connection
with the completion of our acquisition of
Ameri India
on July 1, 2016, pursuant to
the terms of a Stock Purchase Agreement dated May 26, 2015.
67
Rai Note Transaction
On March 2, 2017, we
entered into a Securities Purchase Agreement with Dhruwa N. Rai, pursuant to which Mr. Rai purchased from the Company and the Company
issued to Mr. Rai an 8% Convertible Unsecured Promissory Note due March 2, 2020, in the principal amount of $1,000,000 (the "Rai
Note"). Prior to maturity, the Rai Note will bear interest at 8% per annum, with interest being paid annually on the first,
second and third anniversaries of the issuance of the Rai Note beginning on March 2, 2018. From and after an event of default and
for so long as the event of default is continuing, the Rai Note will bear default interest at the rate of 10% per annum. The Rai
Note can be prepaid by us at any time without penalty.
The Rai Note is convertible
into shares of our common stock at a conversion price of (i) in the event that any registration statement for the public offering
of common stock filed by us with the SEC in connection with an uplisting to a national stock exchange is declared effective by
the SEC on or prior to December 31, 2017, such price per share that is equal to 68% of the price per share of common stock offered
and sold pursuant to such registration statement, or (ii) if no such registration statement is declared effective by December 31,
2017, such price per share that is equal to the weighted average closing price per share of our common stock for the 20 trading
days immediately preceding December 31, 2017, subject to adjustment under certain circumstances. Upon the effectiveness of this
registration statement, the holder of the Rai Note has the right, at his option, at any time and from time to time to convert,
in part or in whole, the outstanding principal amount and all accrued and unpaid interest under the Rai Note into shares of the
Company's common stock at the then applicable conversion price.
The Rai Note ranks
junior to our secured credit facility with Sterling National Bank. The Rai Note also includes certain negative covenants including,
without the investors' approval, restrictions on dividends and other restricted payments and reclassification of its stock.
68
Security
Ownership of Certain Beneficial Owners and Management
The following table
sets forth information as of September __, 2017 regarding the beneficial ownership of our common stock by (i) each person
we know to be the beneficial owner of 5% or more of our common stock, (ii) each of our current executive officers, (iii) each
of our directors, and (iv) all of our current executive officers and directors as a group. Information with respect to beneficial
ownership has been furnished by each director, executive officer or 5% or more stockholder, as the case may be. Unless otherwise
indicated, the persons or entities identified in this table have sole voting and investment power with respect to all shares shown
as beneficially owned by them.
Name
(1)
Number of Shares Beneficially Owned
Percentage of Shares Beneficially Owned
(2)
Executive Officers, Present Directors and Proposed Directors:
Jeffrey E. Eberwein
(3)(4)
4,443,795
25.66
%
Srinidhi "Dev" Devanur
6,276,375
42.84
%
Giri Devanur
2,179,125
14.87
%
Dimitrios J. Angelis
(5)
48,604
*
Dr. Arthur M. Langer
(6)
94,862
*
Robert G. Pearse
(7)
47,700
*
Carlos Fernandez
(8)
101,250
*
Venkatraman Balakrishnan
(9)
27,995
*
Srirangan Rajagopal
(10)
432,000
2.95
%
Dhruwa N. Rai
(11)
669,996
4.52
%
Edward O'Donnell
(12)
—
*
Viraj Patel
—
*
All executive officers and directors as a group (12 persons)
(13)
14,294,636
81.29
%
5% Stockholders:
Lone Star Value Management, LLC
(3)(4)
4,443,795
25.66
%
______________
*
Less than one percent of outstanding shares.
(1)
Unless otherwise indicated, the address of each person or entity is c/o AMERI Holdings, Inc., 100 Canal Pointe Boulevard, Suite 108, Princeton, New Jersey 08540.
(2)
The calculation in this column is based upon 14,650,412 shares of common stock outstanding as of September __, 2017. Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities. Shares of common stock that are currently convertible or exercisable within 60 days of September ___, 2017 are deemed to be beneficially owned by the person holding such securities for the purpose of computing the percentage of ownership of such person, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person.  Unless otherwise indicated, the persons or entities identified in this table have sole voting and investment power with respect to all shares shown as beneficially owned by them.
(3)
Includes (A) (i) 1,666,755 shares of common stock and (ii) 2,666,666 shares of common stock reserved for issuance upon the exercise of the Warrants, in each case held of record by LSVI, and (B) 27,066 shares of common stock held of record by Jeffrey E. Eberwein, our Chairman. Lone Star Value Investors GP, LLC ("Lone Star Value GP"), the general partner of LSVI and Lone Star Value Management, the investment manager of LSVI, may be deemed to beneficially own the 4,333,421 shares held by LSVI. Jeffrey E. Eberwein as the managing member of Lone Star Value GP may be deemed to beneficially own the 4,333,421 shares held by LSVI. Mr. Eberwein disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein. The address of Mr. Eberwein, LSVI, Lone Star Value GP and Lone Star Value Management is 53 Forest Avenue, 1st Floor, Old Greenwich, CT 06870.
69
(4)
Includes 83,308 shares held in an account separately managed by Lone Star Value Management. Lone Star Value Management, as the investment manager of the separately managed account, may be deemed to beneficially own the 83,308 shares held in the separately managed account; and Jeffrey Eberwein, our Chairman, as the sole member of Lone Star Value Management may be deemed to beneficially own the shares held in the separately managed account. Mr. Eberwein disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein.
(5)
Consists of 23,604 shares of common stock and 25,000 shares of common stock issuable upon exercise of options exercisable within 60 days.
(6)
Consists of 69,862 shares of common stock and 25,000 shares of common stock issuable upon exercise of options exercisable within 60 days.
(7)
Consists of 22,700 shares of common stock and 25,000 shares of common stock issuable upon exercise of options exercisable within 60 days.
(8)
Carlos Fernandez served as our Executive Vice President – Corporate Development from May 26, 2015 through July 28, 2017.
(9)
Consists of 2,995 shares of common stock and 25,000 shares of common stock issuable upon exercise of options exercisable within 60 days.
(10)
Srirangan Rajagopal served as our Executive Vice President – Head of Marketing and Strategic Initiatives from May 26, 2015 through July 28, 2017.
(11)
Consists of 503,329 shares of common stock and 166,667 shares of common stock issuable upon exercise of options exercisable within 60 days.
(12)
Edward O'Donnell served as our Chief Financial Officer from January 27, 2016 through December 8, 2016.
(13)
Consists of 11,361,303 shares of common stock, 2,666,666 shares of common stock reserved for issuance upon the exercise of the Warrants held of record by LSVI and 266,667 shares of common stock issuable upon exercise of options exercisable within 60 days.
In addition, LSVI holds
383,985 shares of our Series A Preferred Stock, representing 100% of the issued and outstanding shares of the Series A Preferred
Stock.
70
Description
of Capital Stock
Authorized and Outstanding Stock
Our certificate of
incorporation authorizes the issuance of 101,000,000 shares of capital stock, consisting of 100,000,000 shares of common stock,
and 1,000,000 shares of preferred stock, $0.01 par value, 700,000 of which have been designated as 9.0% Series A Cumulative Preferred
Stock, par value $0.01 per share, which we refer to herein as the Series A Preferred Stock.
As of September ___,
2017, there were 14,650,412 shares of common stock outstanding, held of record by 534 holders, and 383,985 shares of Series A Preferred
Stock outstanding, held of record by one holder. In addition, 2,666,666 Warrant Shares are issuable upon exercise of the 2,666,666
Warrants, held of record by one holder. The number of record holders of our common stock, Series A Preferred Stock and Warrants
does not include beneficial owners holding shares through nominee names.
Common Stock
Holders of our common
stock are entitled to one vote per share on all matters on which stockholders may vote at all stockholder meetings. Our Certificate
of Incorporation does not provide for cumulative voting. Holders of our common stock are entitled to receive ratably such dividends,
if any, as may be declared by our Board out of legally available funds. However, the current policy of our Board is to retain earnings,
if any, for the operation and expansion of the company. Upon liquidation, dissolution or winding-up, the holders of our common
stock are entitled to share ratably in all of our assets which are legally available for distribution. The holders of our common
stock have no preemptive, subscription, redemption or conversion rights.
Preferred Stock
Our Certificate of
Incorporation provides that shares of our preferred stock may be issued from time to time in one or more series. Our Board is authorized
to fix the voting rights, if any, designations, powers, preferences, the relative, participating, optional or other special rights
and any qualifications, limitations and restrictions thereof, applicable to the shares of each series. Our board of directors is
able to, without stockholder approval, issue preferred stock with voting and other rights that could adversely affect the voting
power and other rights of the holders of the common stock and could have anti-takeover effects. The ability of our Board to issue
preferred stock without stockholder approval could have the effect of delaying, deferring or preventing a change of control of
us or the removal of existing management.
Series A Preferred Stock
On December 30, 2016,
we filed a Certificate of Designation of Rights and Preferences (the "Certificate of Designation") to our Certificate
of Incorporation for the Series A Preferred Stock with the Secretary of State of the State of Delaware with respect to 700,000
shares of Series A Preferred Stock. Pursuant to the Certificate of Designation, except upon a change of control of the Company,
the Series A Preferred Stock is not convertible into, or exchangeable for, any of the Company's other property or securities.
The Certificate of Designation provides for the payment of cash dividends on the Series A Preferred Stock at a rate of 9.00% per
annum, provided that we may pay dividends in-kind through the issuance of additional shares to holders of the Series A Preferred
Stock at a rate per annum equal to 11.00% per annum, at the sole option of the Company, for up to four quarterly dividend periods
in any consecutive 36-month period, determined on a rolling basis.
The Series A Preferred
Stock has no voting rights; however, if the Company does not pay dividends on the Series A Preferred Stock for six or more quarterly
periods, whether or not consecutive, the holders of the Series A Preferred Stock, voting as a single class with the holders of
any other parity security upon which like voting rights have been conferred and are exercisable, will be entitled to vote for the
election of two additional directors to serve on the Company's board of directors until the Company pays all dividends owed
on the Series A Preferred Stock and parity securities. In addition, the affirmative vote of the holders of at least two-thirds
of the outstanding shares of Series A Preferred Stock (such series voting together as a separate class) shall be required for to
authorize, create or increase shares ranking senior to the Series A Preferred Stock or to effect certain amendments to the Company
charter that would materially and adversely affect the terms of the Series A Preferred Stock.
71
The Company may not
redeem the Series A Preferred Stock prior to the one year anniversary of its issuance, except pursuant to a special redemption
following a change of control of the Company. On and after the one year anniversary of the issuance of the Series A Preferred Stock,
the Company may redeem the Series A Preferred Stock for cash at its option, in whole or in part, at a redemption price of $50 per
share, plus accrued and unpaid dividends. Following a change of control, the Company will have the option to redeem the Series
A Preferred Stock for cash at $50 per share plus accrued and unpaid dividends, in whole or in part. The Series A Preferred Stock
shall not have any stated maturity redemption date and will not be subject to any sinking fund or mandatory redemption provisions
except for redemption at the Company's option upon a change of control.
Upon a change of control,
holders of the Series A Preferred Stock will have the right (unless, prior to the change of control conversion date, the Company
provides notice of its election to redeem the Series A Preferred Stock) to convert some or all of the Series A Preferred Stock
on a specified change of control conversion date into a number of shares of common stock (or equivalent value of alternative consideration)
per share of Series A Preferred Stock to be converted equal to the lesser of:
·
the quotient obtained by dividing (1) the sum of the $50.00 liquidation preference plus the amount
of any accumulated and unpaid dividends to, but not including, the change of control conversion date (unless the change of control
conversion date is after a record date for a Series A Preferred Stock dividend payment and prior to the corresponding Series A
Preferred Stock dividend payment date, in which case no additional amount for such accumulated and unpaid dividends will be included
in this sum) by (2) the common stock price at the time of conversion; and
·
25.
If, prior to the change
of control conversion date, the Company provides a redemption notice, whether pursuant to the special optional redemption right
in connection with a change of control or the optional redemption right, the Series A Preferred Stock will not have any right to
convert in connection with the change of control conversion right and any Series A Preferred Stock subsequently selected for redemption
that has been tendered for conversion will be redeemed on the related date of redemption instead of converted on the change of
control conversion date.
Warrants
The
Original Warrants issued in the Private Placement give LSVI the right to purchase up to 2,666,666 shares of common stock (the Original
Warrant Shares) at an exercise price equal to $1.80 per share. The Original Warrant may be exercised on a cashless-exercise basis,
meaning that, upon exercise, the holder would make no cash payment to us, and would receive a number of shares of our common stock
having an aggregate value equal to the excess of the then-current market price of the Original Warrant Shares issuable upon exercise
of the Original Warrant over the exercise price of the Original Warrant. The Original Warrant will expire on May 26, 2020. The
Original Warrant exercise price is subject to customary adjustment provisions for stock splits, stock dividends, recapitalizations
and the like.
On May 13, 2016, LSVI
completed an early partial exercise of the Original Warrants for 1,111,111 shares the Company's common stock at a price of
$1.80 per share, for total consideration to the Company of $2,000,000, and LSVI was issued a replacement warrant for the remaining
1,166,666 shares under the Original Warrants on the same terms as the Original Warrants. LSVI also agreed to an amendment of the
Convertible Note, to extend the maturity of the Convertible Note for two years in exchange for (i) the right to request that the
Board expand the size of the Board to nine directors from the current eight, with LSVI having the right to designate up to four
of the nine directors, and (ii) the issuance of a the Additional Warrant for the purchase of 1,000,000 shares of the Company's
common stock at a price of $6.00 per share, on substantively the same terms as the Original Warrant. LSVI's Registration
Rights Agreement, dated May 26, 2015, with us was also amended and restated to include the Additional Warrant Shares issuable under
the Additional Warrant.
72
On December 30, 2016,
the Company entered into the Exchange Agreement with LSVI, pursuant to which the Convertible Note was returned to the Company and
cancelled in exchange for 363,611 shares of the Company's Series A Preferred Stock, which is non-convertible and perpetual
preferred stock of the Company. As a result of the exchange transaction, no principal or interest remained outstanding or payable
under the Convertible Note and the Convertible Note was no longer convertible into shares of common stock of the Company.
Dividends
To date, we have not
paid any cash dividends on our common stock or the Series A Preferred Stock. The payment of cash dividends in the future will be
dependent upon our revenues and earnings, if any, capital requirements and general financial condition and will be within the discretion
of our Board at such time. Further, if we incur any indebtedness, our ability to declare dividends may be limited by restrictive
covenants we may agree to in connection therewith.
Our Transfer Agent and Warrant Agent
The transfer agent
and registrar for our common stock and Series A Preferred Stock is Corporate Stock Transfer, located in Denver, Colorado. We serve
as the warrant agent for the Warrants.
Certain Anti-Takeover Provisions of Delaware Law
Pursuant to our Certificate
of Incorporation, we are not subject to the provisions of Section 203 of the Delaware General Corporation Law regulating corporate
takeovers through a "business combination" with a stockholder who owns 15% or more of our outstanding voting stock
(otherwise known as an "interested stockholder").
Registration Rights
In accordance with
the terms of the sale of the 2017 Notes, the investors and the Company entered into Registration Rights Agreements, pursuant to
which the Company granted the investors piggyback registration rights in the event the Company proposes to register the offer and
sale of any shares of its common stock under the Securities Act (other than a registration (A) in connection with an uplisting
of the Company's common stock to a national stock exchange, (B) pursuant to a registration statement on Form S-8 (or other
registration solely relating to an offering or sale to employees or directors of the Company pursuant to any employee stock plan
or other employee benefit arrangement), (C) pursuant to a registration statement on Form S-4 (or similar form that relates to a
transaction subject to Rule 145 under the Securities Act or any successor rule thereto), or (D) in connection with any dividend
or distribution reinvestment or similar plan), whether for its own account or for the account of one or more stockholders of the
Company. We are obligated to maintain the effectiveness of such registration statement from its effective date until the later
of (a) the date on which all registrable shares have been sold or distributed or, if earlier, until such registrable securities
may be sold by under Rule 144 (provided that the Company's transfer agent has accepted an instruction from the Company to
such effect) or (b) the third (3rd) anniversary of the closing of the 2017 Notes sale. We agreed to use our best efforts to have
such registration statement declared effective by the SEC as soon as commercially reasonably possible. There are no monetary penalties
if the 2017 Notes piggyback registration statement is not filed or does not become effective on a timely basis.
Quotation of Common Stock
Our common stock is
quoted on the OTCQB Marketplace under the symbols "AMRH". We have applied for the listing of our common stock on The
Nasdaq Capital Market, and expect such listing to occur concurrently with this offering.
73
Shares
Eligible for Future Sale
Future sales of shares
of our common stock in the public market, or the availability of such shares for sale in the public market, could adversely affect
the market price of our common stock prevailing from time to time. As described below, only a limited number of shares are currently
available for sale due to contractual and legal restrictions on resale. Nonetheless, sales of our common stock, or the perception
that these sales could occur, could adversely affect prevailing market prices for our common stock and could impair our future
ability to raise equity capital in the future.
Based on the number
of shares outstanding as of September ___, 2017, upon the closing of this offering, __________ shares of common stock will be outstanding,
assuming no exercise of outstanding options, settlement of outstanding restricted stock units or warrants and no exercise of the
underwriters' over-allotment option. Of the outstanding shares, all of the shares of common stock sold in this offering (including
pursuant to the underwriters' exercise of their over-allotment option) will be freely tradable, except that any shares held
by our affiliates, as that term is defined in Rule 144 under the Securities Act, may only be sold in compliance with the limitations
described below.
The remaining shares
of our common stock outstanding after this offering are restricted securities, as that term is defined in Rule 144 under the Securities
Act.
Rule 144.
In general, persons
who have beneficially owned restricted shares of our common stock for at least six months, and any affiliate of ours who owns either
restricted or unrestricted shares of our common stock, are entitled to sell their securities without registration with the SEC
under an exemption from registration provided by Rule 144 under the Securities Act.
In general, a person
who has beneficially owned restricted shares of our common stock for at least six months would be entitled to sell their securities
provided that (i) such person is not deemed to have been one of our affiliates at the time of, or at any time during the 90 days
preceding, a sale and (ii) we have been subject to the Exchange Act periodic reporting requirements for at least 90 days before
the sale. Persons who have beneficially owned restricted shares of our common stock for at least six months, but who are our affiliates
at the time of, or any time during the 90 days preceding, a sale, would be subject to additional restrictions, by which such person
would be entitled to sell within any three-month period only a number of securities that does not exceed the greater of either
of the following:
·
1% of the number of shares of our common stock then outstanding, which will equal approximately
shares immediately after the closing of this offering based on the number of shares of our common stock outstanding as of , 2017
and assuming no exercise of the underwriters' over-allotment option; or
·
the average weekly trading volume of our common stock on The Nasdaq Capital Market during the four
calendar weeks preceding the filing of a notice on Form 144 with respect to the sale;
provided, in each case, that we have been
subject to the Exchange Act periodic reporting requirements for at least 90 days before the sale. Such sales both by affiliates
and by non-affiliates must also comply with the manner of sale, current public information and notice provisions of Rule 144.
Equity Incentive Plan
We have filed a Form
S-8 registration statement under the Securities Act to register shares of our common stock issued or reserved for issuance under
the Plan. Accordingly, the shares covered by such registration statement are eligible for sale in the public markets, subject to
vesting restrictions, and Rule 144 limitations applicable to affiliates.
74
Underwriting
Ladenburg Thalmann
& Co. Inc. is acting as representative of the underwriters (the "Representative"). Subject to the terms and conditions
of an underwriting agreement between us and the Representative, we have agreed to sell to each underwriter named below, and each
underwriter named below has severally agreed to purchase, at the public offering price less the underwriting discounts set forth
on the cover page of this prospectus, the number of shares of common stock listed next to its name in the following table:
Name of Underwriter
Number of
Shares
Ladenburg Thalmann & Co. Inc.
Total
The underwriters are
committed to purchase all the shares of common stock offered by us if they purchase any shares of common stock. The underwriting
agreement also provides that if an underwriter defaults, the purchase commitments of non-defaulting underwriters may be increased
(subject to limitations) or the offering may be terminated. The underwriters are not obligated to purchase the shares of common
stock covered by the underwriters' over-allotment option described below. The underwriters are offering the shares of common
stock, subject to prior sale, when, as and if issued to and accepted by them, subject to approval of legal matters by their counsel,
and other conditions contained in the underwriting agreement, such as the receipt by the underwriters of officer's certificates
and legal opinions. The underwriters reserve the right to withdraw, cancel or modify offers to the public and to reject orders
in whole or in part.
The underwriters have
advised us that they do not intend to confirm sales to any account over which they exercise discretionary authority.
Discounts and Commissions
The underwriters propose
initially to offer the shares of common stock to the public at the public offering price set forth on the cover page of this prospectus
and to dealers at those prices less a concession not in excess of $ per share of common stock. If all of the shares of common stock
offered by us are not sold at the public offering price, the underwriters may change the offering price and other selling terms
by means of a supplement to this prospectus.
The following table
shows the public offering price, underwriting discounts and commissions and proceeds before expenses to us. The information assumes
either no exercise or full exercise of the over-allotment option we granted to the Representatives of the underwriters. In addition
to the below, we have paid an initial engagement fee of $50,000 to the Representative.
Total
Per Share
Without
Over-Allotment
With
Over-Allotment
Public offering price
$
$
$
Underwriting discount (7%)
$
$
$
Proceeds, before expenses, to us
$
$
$
We have agreed to pay
an accountable expense allowance to the Representative of the underwriters for up to $100,000 of expenses incurred by the Representative
in connection with the offering. We have paid an expense deposit of $20,000 to the Representative, which will be applied against
the accountable expenses that will be paid by us to the underwriters in connection with this offering, and will be reimbursed to
us to the extent not actually incurred in compliance with FINRA Rule 5110(f)(2)(C).
The total estimated
expenses of the offering, including registration, filing and listing fees, printing fees and legal and accounting expenses, but
excluding underwriting discounts, commissions and expenses, are approximately $______ and are payable by us.
75
Over-Allotment Option
We have granted a 30-day
option to the Representative of the underwriters to purchase up to ______ additional shares of our common stock at a public offering
price of $_____ per share, solely to cover over-allotments, if any. The underwriters may exercise this option for 30 days from
the date of this prospectus solely to cover sales of shares of common stock by the underwriters in excess of the total number of
shares of common stock set forth in the table above. If any of these additional shares are purchased, the underwriters will offer
the additional shares on the same terms as those on which the shares are being offered. We will pay the expenses associated with
the exercise of the over-allotment option.
Right of First Refusal
Until twelve (12) months
from the effective date of this registration statement, the Representative shall have an irrevocable right of first refusal to
act as sole investment banker, sole book-runner, and/or sole placement agent, at the Representative's sole discretion, for
each and every future offering of our equity securities on terms customary to the Representative. The Representative shall have
the sole right to determine whether or not any other broker-dealer shall have the right to participate in any such offering and
the economic terms of any such participation. The Representative will not have more than one opportunity to waive or terminate
the right of first refusal in consideration of any payment or fee.
Determination of Offering Price
Our shares
of common stock are currently quoted on the OTCQB Marketplace under the symbol "AMRH." On September __, 2017, the closing
price of our common stock was $___ per share. We have applied for the listing of our common stock on the NASDAQ Capital Market
under the ticker symbol "AMRH" and will use our best efforts to have that listing effective on or before the closing.
No assurance can be given that such listing will be approved; however, it is a condition of the underwriters' obligation
that our shares of common stock have been approved for listing on The Nasdaq Capital Market. There is no established public trading
market for our common stock and the share prices on an over-the-counter marketplace may not be indicative of the market price of
our common stock on the NASDAQ Capital Market. The public offering price of the securities offered by this prospectus will be determined
by negotiation between us and the Representative. Among the factors considered in determining the public offering price of the
shares were:
·
our history and our prospects;
·
the industry in which we operate;
·
our past and present operating results;
·
the previous experience of our executive officers; and
·
the general condition of the securities markets at the time of this offering.
The offering
price stated on the cover page of this prospectus should not be considered an indication of the actual value of our shares of common
stock. That price is subject to change as a result of market conditions and other factors, and we cannot assure you that our shares
of common stock can be resold at or above the public offering price.
Lock-up Agreements
Our officers and directors
and LSVI and certain of its affiliated entities have agreed with the Representative to be subject to a lock-up period of 90 days
following the date of this prospectus. This means that, during the applicable lock-up period, such persons may not offer for sale,
contract to sell, sell, distribute, grant any option, right or warrant to purchase, pledge, hypothecate or otherwise dispose of,
directly or indirectly, any shares of our common stock or any securities convertible into, or exercisable or exchangeable for,
shares of our common stock. Certain limited transfers are permitted during the lock-up period if the transferee agrees to these
lock-up restrictions. We have also agreed, in the underwriting agreement, to similar lock-up restrictions on the issuance and sale
of our securities for 90 days following the closing of this offering, although we will be permitted to issue stock options or stock
awards to directors, officers and employees under our existing plans. The lock-up period is subject to an additional extension
to accommodate for our reports of financial results or material news releases. The Representative may, in its sole discretion and
without notice, waive the terms of any of these lock-up agreements.
76
Indemnification
We have agreed to indemnify
the underwriters against certain liabilities that may be incurred in connection with this offering, including liabilities under
the Securities Act, and to contribute to payments that the underwriters may be required to make for these liabilities.
Price Stabilization, Short Positions and Penalty Bids
In order to facilitate
the offering of our securities, the underwriters may engage in transactions that stabilize, maintain or otherwise affect the price
of our securities. In connection with the offering, the underwriters may purchase and sell our securities in the open market. These
transactions may include short sales, purchases on the open market to cover positions created by short sales and stabilizing transactions.
Short sales involve the sale by the underwriters of a greater number of shares of securities than they are required to purchase
in the offering. "Covered" short sales are sales made in an amount not greater than the underwriters' over-allotment
option. The underwriters may close out any covered short position by either exercising the over-allotment option or purchasing
shares of securities in the open market. In determining the source of shares of securities to close out the covered short position,
the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to
the price at which they may purchase shares through the over-allotment option. "Naked" short sales are sales in excess
of the over-allotment option. The underwriters must close out any naked short position by purchasing securities in the open market.
A naked short position is more likely to be created if the underwriters are concerned that there may be downward pressure on the
price of our securities in the open market after pricing that could adversely affect investors who purchase in the offering. Stabilizing
transactions consist of various bids for or purchases of shares of securities made by the underwriters in the open market before
the completion of the offering.
Similar to other purchase
transactions, the underwriters' purchases to cover the syndicate short sales may have the effect of raising or maintaining
the market price of our securities or preventing or retarding a decline in the market price of our securities. As result, the price
of our securities may be higher than the price that might otherwise exist in the open market.
The underwriters have
advised us that, pursuant to Regulation M under the Exchange Act, they may also engage in other activities that stabilize, maintain
or otherwise affect the price of our securities, including the imposition of penalty bids. This means that if the Representative
of the underwriters purchases securities in the open market in stabilizing transactions or to cover short sales, the Representative
can require the underwriters that sold those shares as part of this offering to repay the underwriting discount received by them.
The underwriters make no representation or prediction as to the direction or magnitude of any effect that the transactions described
above may have on the price of our securities. In addition, neither we nor the underwriters make any representation that the underwriters
will engage in these transactions or that these transactions, once commenced, will not be discontinued without notice.
Electronic Offer, Sale and Distribution of Shares
A prospectus in electronic
format may be made available on the websites maintained by one or more underwriters or selling group members, if any, participating
in the offering. The underwriters may agree to allocate a number of shares of securities to underwriters and selling group members
for sale to their online brokerage account holders. Internet distributions will be allocated by the Representative to underwriters
and selling group members that may make internet distributions on the same basis as other allocations. Other than the prospectus
in electronic format, the information on the underwriters' websites and any information contained in any other website maintained
by the underwriters is not part of this prospectus or the registration statement of which this prospectus forms a part.
77
Other Relationships
From time to time,
certain of the underwriters and their affiliates have provided, and may provide in the future, various advisory, investment and
commercial banking and other services to us in the ordinary course of business, for which they have received and may continue to
receive customary fees and commissions. However, except as disclosed in this prospectus, we have no present arrangements with any
of the underwriters for any further services.
Transfer Agent and Registrar
The transfer agent
and registrar for our common stock is Corporate Stock Transfer.
Offer Restrictions Outside the United States
Other than in the United
States, no action has been taken by us or the underwriters that would permit a public offering of the securities offered by this
prospectus in any jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be
offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection
with the offer and sale of any such securities be distributed or published in any jurisdiction, except under circumstances that
will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus
comes are advised to inform themselves about and to observe any restrictions relating to the offering and the distribution of this
prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by
this prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.
78
Legal
Matters
The validity of the
securities offered hereby will be passed upon for us by Olshan Frome Wolosky LLP of New York, New York. Certain members of Olshan
Frome Wolosky LLP own securities of the Company. Certain legal matters in connection with this offering will be passed upon for
the underwriters by McGuireWoods LLP.
Experts
Our audited condensed
consolidated financial statements as of December 31, 2016 and 2015 and for the years then ended, the audited consolidated financial
statements of Bellsoft, Inc. as of December 31, 2015 and 2014 and for the years then ended, the audited consolidated financial
statements of DC&M Partners, L.L.C. as of December 31, 2015 and 2014 and for the years then ended, and the audited consolidated
financial statements of ATCG Technology Solutions, Inc. as of December 31, 2016 and 2015 and for the years then ended, are included
herein in reliance on the reports of Ram Associates, an independent registered public accounting firm, on the authority of said
firm as experts in auditing and accounting.
Where
You Can Find More Information
We have filed with
the SEC a registration statement on Form S−1 under the Securities Act with respect to the shares of common stock being offered
by this prospectus. This prospectus does not contain all of the information included in the registration statement. For further
information pertaining to us and our common stock you should refer to the registration statement and its exhibits. Statements contained
in this prospectus concerning any of our contracts, agreements or other documents are not necessarily complete. If a contract or
document has been filed as an exhibit to the registration statement, we refer you to the copy of the contract or document that
has been filed. Each statement in this prospectus relating to a contract or document filed as an exhibit is qualified in all respects
by the filed exhibit.
We are subject to the
informational requirements of the Exchange Act and file annual, quarterly and current reports and other information with the SEC.
Our filings with the SEC are available to the public on the SEC's website at http://www.sec.gov. Those filings are also available
to the public on, or accessible through, our website under the heading "Investors" at www.ameri100.com. The information
we file with the SEC or contained on or accessible through our corporate website or any other website that we may maintain is not
part of this prospectus or the registration statement of which this prospectus is a part. You may also read and copy, at SEC prescribed
rates, any document we file with the SEC, including the registration statement (and its exhibits) of which this prospectus is a
part, at the SEC's Public Reference Room located at 100 F Street, N.E., Washington D.C. 20549. You can call the SEC at 1-800-SEC-0330
to obtain information on the operation of the Public Reference Room.
79
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
AMERI HOLDINGS, INC.
PAGE
AUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2016 AND 2015 AND FOR THE YEARS THEN ENDED
Report of Independent Registered Public Accounting Firm
F-3
Audited Condensed Consolidated Balance Sheets
F-4
Audited Condensed Consolidated Statements of Comprehensive Income (Loss)
F-5
Consolidated Statement of Changes in Stockholders' Equity From March 31, 2015 to December 31, 2016
F-6
Audited Condensed Consolidated Statements of Cash Flows for the Years Ended December 31, 2016 and December 31, 2015
F-7
Notes to Audited Condensed Consolidated Financial Statements
F-8
UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2017
Unaudited Condensed Consolidated Balance Sheets as of June 30, 2017 and December 31, 2016
F-25
Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the Three Months Ended June 30, 2017 and 2016 and for the Six Months Ended June 30, 2017 and 2016
F-26
Unaudited Condensed Consolidated Statements of Cash Flows as of June 30, 2017 and December 31, 2016
F-27
Notes to Unaudited Condensed Consolidated Financial Statements
F-28
BELLSOFT, INC.
AUDITED CONSOLIDATED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2014 AND 2013 AND FOR THE YEARS THEN ENDED
Report of Independent Registered Public Accounting Firm
F-42
Consolidated Balance Sheets
F-43
Consolidated Statements of Income and Comprehensive Income
F-44
Consolidated Statements of Changes in Shareholders' Equity
F-45
Consolidated Statements of Cash Flows
F-46
Notes to Consolidated Financial Statements
F-47
UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2015
Unaudited Condensed Consolidated Balance Sheets
F-53
Unaudited Condensed Consolidated Statements of Comprehensive Income
F-54
Unaudited Condensed Consolidated Statements of Cash Flows
F-55
Notes to Unaudited Condensed Consolidated Financial Statements
F-56
DC&M PARTNERS, L.L.C.
AUDITED CONSOLIDATED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2015 AND 2014 AND FOR THE YEARS THEN ENDED
Report of Independent Registered Public Accounting Firm
F-64
Balance Sheets
F-65
Statements of Income and Comprehensive Income
F-66
Statements of Changes in Members' Equity
F-67
Statements of Cash Flows
F-68
Notes to Financial Statements
F-69
UNAUDITED CONDENSED FINANCIAL STATEMENTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2015
Unaudited Condensed Balance Sheets for the Six Months Ended June 30, 2015 and 2016
F-73
F-
1
Unaudited Condensed Statements of Income and Comprehensive Income for the Three and Six Months Ended June 30, 2015 and 2016
F-74
Unaudited Condensed Statements of Cash Flows for the Six Months Ended June 30, 2015 and 2016
F-75
Notes to Unaudited Condensed Financial Statements
F-76
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
F-81
Unaudited Pro Forma Combined Statement of Operations For the Year Ended December 31, 2016
F-82
Notes to Unaudited Pro Forma Combined Financial Statements
F-83
ATCG TECHNOLOGY SOLUTIONS, INC.
AUDITED CONSOLIDATED FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2016 AND 2015 AND FOR THE YEARS THEN ENDED
Report of Independent Registered Public Accounting Firm
F-84
Balance Sheets
F-85
Statements of Income and Comprehensive Income
F-86
Statements of Changes in Stockholders' Equity
F-87
Statements of Cash Flows
F-88
Notes to Financial Statements
F-89
UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS
F-94
Unaudited Pro Forma Combined Statement of Operations For the Year Ended December 31, 2016
F-95
Notes to Unaudited Pro Forma Combined Financial Statements
F-96
F-
2
REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
The Board of Directors and Stockholders
AMERI Holdings, Inc.
We have audited the accompanying consolidated
balance sheets of AMERI Holdings, Inc. (the "Company") as of December 31, 2016 and 2015 and the related consolidated
statements of operations, comprehensive income (loss), stockholders' equity and cash flows for each of the two years in the period
ended December 31, 2016 and 2015. AMERI Holdings, Inc.'s management is responsible for these financial statements. Our responsibility
is to express an opinion on these consolidated financial statements based on our audits.
We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the consolidated 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 audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial
statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31,
2016 and 2015 and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2016
and 2015, in conformity with accounting principles generally accepted in the United States of America.
/s/ Ram Associates
Ram Associates
Hamilton, NJ
March 30, 2017
F-
3
AMERI HOLDINGS, INC.
AUDITED CONDENSED CONSOLIDATED BALANCE
SHEETS
December 31,
2016
December 31,
2015
Assets
Current assets:
Cash and cash equivalents
$
1,379,887
$
1,878,034
Accounts receivable
8,059,910
4,872,082
Investments
82,908
82,908
Other current assets
542,237
343,809
Total current assets
10,064,942
7,176,833
Other assets:
Property and equipment, net
100,241
73,066
Intangible assets, net
8,764,704
3,114,513
Acquired goodwill
17,089,076
3,470,522
Deferred income tax assets, net
3,488,960
—
Total other assets
29,442,981
6,658,101
Total assets
$
39,507,923
$
13,834,934
Liabilities and Stockholders' Equity
Current liabilities:
Line of credit
3,088,890
1,235,935
Accounts payable
5,130,817
2,597,385
Other accrued expenses
2,165,088
1,093,814
Current Portion - Long Term Notes
405,376
—
Consideration payable – Cash
1,854,397
3,649,267
Consideration payable – Equity
64,384
—
Total current liabilities
12,708,952
8,576,401
Long term liabilities:
Convertible notes
—
5,000,000
Long-term notes – Net of Current Portion
1,536,191
—
Long-term consideration payable – Cash
2,711,717
—
Long-term consideration payable – Equity
10,887,360
—
Total Long-term Liabilities
15,135,268
5,000,000
Total liabilities
27,844,220
13,576,401
Stockholders' equity:
Preferred stock, $0.01 par value; 1,000,000 authorized, 363,611 issued and outstanding as of December 31, 2016, and none outstanding as of December 31, 2015
3,636
—
Common stock, $0.01 par value; 100,000,000 shares authorized, 13,885,972 and 11,874,361 issued and outstanding as of December 31, 2016, and December 31, 2015, respectively
138,860
118,743
Additional paid-in capital
15,358,839
1,192,692
Accumulated deficit
(3,833,588
)
(1,052,902
)
Accumulated other comprehensive income (loss)
(7,426
)
—
Non-Controlling Interest
3,382
—
Total stockholders' equity
11,663,703
258,533
Total liabilities and stockholders' equity
$
39,507,923
$
13,834,934
See notes to the audited condensed consolidated
financial statements.
F-
4
AMERI HOLDINGS, INC.
AUDITED CONDENSED CONSOLIDATED STATEMENTS
OF COMPREHENSIVE INCOME (LOSS)
Twelve Months
Ended
December 31,
2016
2015
Net revenue
$
36,145,589
$
20,261,172
Cost of revenue
29,608,932
13,391,504
Gross profit
6,536,657
6,869,668
Operating expenses:
Selling and marketing
417,249
119,847
General and administration
8,552,966
5,721,633
Acquisition related expenses
1,585,136
1,655,962
Depreciation and amortization
1,361,169
166,208
Operating expenses
11,916,520
7,663,650
Operating income (loss):
(5,379,863
)
(793,982
)
Interest expense
(751,074
)
(238,471
)
Interest income/other income
—
89,918
Other income
16,604
—
Change due to estimate correction
(410,817
)
—
Total other income (expenses)
(1,145,287
)
(148,553
)
Net income (loss) before income taxes
(6,525,150
)
(942,535
)
Income tax benefit (provision)
3,747,846
128,460
Net income (loss)
(2,777,304
)
(814,075
)
Non-controlling interest
(3,382
)
—
Net income (loss) attributable to the Company
(2,780,686
)
(814,075
)
Foreign exchange translation adjustment
(7,426
)
—
Comprehensive income (loss)
$
(2,788,112
)
(814,075
)
Basic income (loss) per share
$
(0.21
)
$
(0.07
)
Diluted income (loss) per share
$
(0.21
)
$
(0.07
)
Basic weighted average number of shares
13,068,597
11,101,198
Diluted weighted average number of shares
13,068,597
11,101,198
See notes to the audited condensed consolidated
financial statements.
F-
5
AMERI HOLDINGS, INC.
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
FROM MARCH 31, 2015 TO DECEMBER 31, 2016
Common
    Stock
Preferred
    Stock
Shares
Par
    Value at $0.01
Shares
Par
    Value at $0.01
Additional
paid-in
capital
Other
Comprehensive
income (loss)
Accumulated
deficit
Non-Controlling
    Interests
Total
stockholders'
equity
Balance at March 31, 2015
9,992,828
$
99,928
-
-
$
35,072
$
-
$
837,856
$
972,856
Issuance of capital for services
566,487
5,665
49,460
-
-
55,125
Issuance of capital for board services
203,935
2,039
-
-
-
2,039
Recapitalization on May 26, 2015
875,816
8,758
(31,401
)
-
-
(22,643
)
Issuance of shares for acquisition
235,295
2,353
997,651
-
-
1,000,004
Equity adjustments for business combinations
-
-
-
-
-
-
Stock, Option, RSU and Warrant Expense
-
-
141,910
-
-
141,910
Net Loss
-
-
-
-
(1,890,758
)
(1,890,758
)
Balance at December 31, 2015
11,874,361
$
118,743
-
-
$
1,192,692
$
-
$
(1,052,902
)
$
258,533
Common stock issued
500,000
5,000
2,995,000
-
-
3,000,000
Conversion of notes into preferred shares
363,611
$
3,636
5,121,364
5,125,000
Conversion of warrants into common shares
1,111,111
11,111
1,988,889
-
-
2,000,000
Issuance of shares for acquisition
400,500
4,006
2,603,247
-
-
2,607,253
Stock, Option, RSU and Warrant Expense
-
-
1,457,647
-
-
1,457,647
Non-Controlling Interests Net Income
3,382
3,382
Accumulated other comprehensive income (loss)
(7,426
)
(7,426
)
Net Loss
-
-
-
-
(2,780,686
)
(2,780,686
)
Balance at December 31, 2016
13,885,972
$
138,860
363,611
$
3,636
$
15,358,839
$
(7,426
)
$
(3,833,588
)
$
3,382
$
11,663,703
See notes to the audited condensed consolidated
financial statements.
F-
6
AMERI HOLDINGS, INC.
AUDITED CONDENSED CONSOLIDATED STATEMENTS
OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER
31, 2016 AND 2015
Twelve Months
Ended
December 31,
2016
2015
Cash flow from operating activities
Net income/(loss)
$
(2,780,686
)
$
(814,075
)
Adjustment to reconcile income/(loss) to net cash used in operating activities
Depreciation and amortization
1,361,169
166,284
Provision for doubtful debts/ (written back), net
—
410,712
Accrued interest on convertible notes
125,000
—
Change due to estimate correction
410,817
—
Stock, option, restricted stock unit and warrant expense
1,457,647
141,910
Deferred income taxes, net
(3,488,960
)
—
Foreign exchange translation adjustment
(7,426
)
—
Changes in assets and liabilities:
Increase (decrease) in:
Accounts receivable
(3,187,828
)
(643,873
)
Other current assets
(198,428
)
(169,549
)
Increase (decrease) in:
Accounts payable and accrued expenses
3,604,706
(89,586
)
Net cash used in operating activities
(2,703,989
)
(998,177
)
Cash flow from investing activities
Purchase of fixed assets
(29,062
)
(70,782
)
Acquisition consideration
(6,563,000
)
(4,670,000
)
Net cash used in investing activities
(6,592,062
)
(4,740,782
)
Cash flow from financing activities
Proceeds from loan funds
3,794,522
6,235,935
Non-Controlling Interests Net Income
3,382
—
Additional stock issued
5,000,000
—
Net cash provided by financing activities
8,797,904
6,235,935
Net increase (decrease) in cash and cash equivalents
(498,147
)
496,976
Cash and cash equivalents as at beginning of the year
1,878,034
1,381,058
Cash at the end of the year
$
1,379,887
$
1,878,034
SUPPLEMENTAL DISCLOSURES:
Cash paid during the period for:
Interest
$
362,792
$
238,471
Taxes
$
-
$
-
See notes to the audited condensed consolidated
financial statements.
F-
7
AMERI HOLDINGS, INC.
NOTES TO AUDITED CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
DECEMBER 31, 2016
NOTE 1.    ORGANIZATION:
AMERI Holdings, Inc. ("AMERI",
the "Company", "we" or "our") is a fast-growing company that, through the operations of its twelve
subsidiaries, provides SAP cloud, digital and enterprise services to clients worldwide. Headquartered in Princeton, New Jersey,
we typically go to market both vertically by industry and horizontally by product/technology specialties and provide our customers
with a wide range of business and technology offerings. We work with customers, primarily within North America, to improve process,
reduce costs and increase revenue through the judicious use of technology.
NOTE 2.    BASIS OF PRESENTATION:
The accompanying audited condensed consolidated
financial statements have been prepared by AMERI pursuant to the rules and regulations of the Securities and Exchange Commission
(the "SEC") regarding annual financial reporting. Certain information and note disclosures normally included in annual
financial statements prepared in accordance with accounting principles generally accepted in the United States of America have
been omitted pursuant to those rules and regulations, although we believe that the disclosures made are adequate to ensure the
information presented is not misleading.
The accompanying audited condensed consolidated
financial statements reflect all adjustments (which were of a normal, recurring nature) that, in the opinion of management, are
necessary to present fairly our financial position, results of operations and cash flows as of and for the interim periods presented.
All intercompany transactions have been eliminated in the accompanying audited condensed consolidated financial statements. These
financial statements should be read in conjunction with the audited financial statements and notes thereto.
Our comprehensive income (loss) consists
of net income (loss) plus or minus any periodic currency translation adjustments.
The Company's year-end is December 31.
Ameri and Partners Inc, the Company's wholly-owned operating subsidiary that was the accounting acquirer in connection with the
Company's May 2015 reverse merger, changed its fiscal year end from March 31 to December 31 pursuant to the merger, so that all
of the Company's subsidiaries' year-ends are consistent with the year-end of the Company.
The Company has reclassified cash paid
for its Bellsoft acquisition in 2015 from operating activities to investing activities.
NOTE 3.    BUSINESS COMBINATIONS:
Acquisition of Bellsoft, Inc.
On November 20, 2015, we completed the
acquisition of Bellsoft, Inc., a consulting company based in Lawrenceville, Georgia with over 175 consultants specialized in the
areas of SAP software, business intelligence, data warehousing and other enterprise resource planning services. Following the acquisition,
the name of Bellsoft, Inc. was changed to Ameri100 Georgia Inc. ("Ameri Georgia"). Ameri Georgia has operations in
the United States, Canada and India. For financial accounting purposes, we recognized September 1, 2015 as the effective date of
the acquisition. The total consideration for the acquisition of Ameri Georgia was $9,910,817, consisting of:
F-
8
(a)
A cash payment in the amount of $3,000,000, which was
paid at closing;
(b)
235,295 shares of our common stock issued at closing,
valued at approximately $1,000,000 based on the closing price of our common stock on the closing date of the acquisition;
(c)
$250,000 quarterly cash payments paid on the last day
of each calendar quarter of 2016;
(d)
$1,000,000 cash reimbursement paid to compensate Ameri
Georgia for a portion of its 	approximate cash balance as of September 1, 2015;
(e)
$2,910,817 was paid in connection with the excess of
Ameri Georgia's accounts receivable over 	its accounts payable as of September 1, 2015; and
(f)
Earn-out payments of approximately $500,000 a year for
2016 and 2017, if earned through the 	achievement of annual revenue and earnings before interest taxes, depreciation and amortization
	("EBITDA") targets specified in the purchase agreement, subject to downward or upward 	adjustment depending
on actual results. We estimate the earn-out payments to be earned at 100% 	of the targets set forth in the purchase agreement.
The earn-out for 2016 was 30% higher than
the previously agreed targets, resulting in a higher than anticipated earn-out payment, and the excess of the 2016 earn-out payment
over what was planned was made as an adjustment to our income statement.
The valuation of Ameri Georgia was made
on the basis of its projected revenues. The accounting acquisition date for Ameri Georgia was determined on the basis of the date
when the Company acquired control of Ameri Georgia, in accordance with FASB codification ASU 805-10-25-6 for business combinations.
That ASU provides that the date on which the acquirer obtains control of the acquiree generally is the date on which the acquirer
legally transfers the consideration, acquires the assets, and assumes the liabilities of the acquiree—the closing date. However,
the acquirer might obtain control on a date that is either earlier or later than the closing date. For example, the acquisition
date precedes the closing date if a written agreement provides that the acquirer obtains control of the acquiree on a date before
the closing date. An acquirer shall consider all pertinent facts and circumstances in identifying the acquisition date. The term
sheet and the Share Purchase Agreement that were entered into by the Company and Ameri Georgia contained agreements by the parties
that the Company acquired control of Ameri Georgia's accounts payable, accounts receivable and business decisions as of September
1, 2015. In addition, on that date, the Company became responsible for performance of Ameri Georgia's existing contracts.
Accordingly, the Company has recognized September 1, 2015 as the accounting acquisition date.
The total purchase price of $9,910,817
was allocated to net working capital of $4.6 million, intangibles of $1.8 million, taking into consideration projected revenue
from the acquired list of Ameri Georgia customers over a period of three years, and the balance was allocated to goodwill.
For this acquisition, the net cash outflow
in 2016 was $2,330,000.
Acquisition of Bigtech Software Private
Limited
On June 23, 2016, we entered into a definitive
agreement to purchase Bigtech Software Private Limited ("Bigtech"), a pure-play SAP services company providing a wide
range of SAP services including turnkey implementations, application management, training and basis ABAP support. Based in Bangalore,
India, Bigtech offers SAP services to improve business operations at companies of all sizes and verticals. The acquisition of Bigtech
was effective as of July 1, 2016, and the total consideration for the acquisition of Bigtech was $850,000, consisting of:
F-
9
(a)
A cash payment in the amount of $340,000 which was due
within 90 days of closing and was paid 	on September 22, 2016;
(b)
Warrants for the purchase of 51,000 shares of our common
stock (valued at approximately $250,000 based on the $6.51 closing price of our common stock on the closing date of the acquisition),
with such warrants exercisable for two years; and
(c)
$255,000, which may become payable in cash earn-outs
to the sellers of Bigtech, if Bigtech 	achieves certain pre-determined revenue and EBITDA targets in 2017 and 2018. We estimate
	the earn-out payments to be earned at 100% 	of the targets set forth in the purchase agreement.
Bigtech's financial results are included
in our condensed consolidated financial results starting July 1, 2016. The Bigtech acquisition did not constitute a significant
acquisition for the Company. The valuation of Bigtech was made on the basis of its projected revenues.
The total purchase price of $850,000 was
allocated to intangibles of $595,000, taking into consideration projected revenue from the acquired list of Bigtech customers over
a period of three years, and the balance was allocated to goodwill. The Bigtech acquisition did not constitute a significant acquisition
for the Company
For this acquisition, the net cash outflow
in 2016 was $340,000.
Acquisition of Virtuoso
On July 22, 2016, we, through wholly-owned
acquisition subsidiaries, acquired all of the outstanding membership interests of Virtuoso, L.L.C. ("Virtuoso"), a
Kansas limited liability company, pursuant to the terms of an Agreement of Merger and Plan of Reorganization, by and among us,
Virtuoso Acquisition Inc., Ameri100 Virtuoso Inc., Virtuoso and the sole member of Virtuoso (the "Sole Member"). Virtuoso
is a SAP consulting firm specialized in providing services on SAP S/4 HANA finance, enterprise mobility and cloud migration and
is based in Leawood, Kansas. In connection with the merger, Virtuoso's name was changed to Ameri100 Virtuoso Inc. The Virtuoso
acquisition did not constitute a significant acquisition for the Company.
The total purchase price paid to the Sole
Member for the acquisition of Virtuoso was $1,831,881, consisting of:
(a)
A cash payment in the amount of $675,000 was due within
90 days of closing;
(b)
101,250 shares of our common stock at closing, valued
at approximately $700,000 based on the 	$6.51 closing price of our common stock on the closing date of the acquisition; and
(c)
Earn-out payments in cash and stock of $450,000 and
approximately $560,807, respectively, to be paid, if earned, through the achievement of annual revenue and gross margin targets
in 2017, 2018 and 2019. Out of the total contingent consideration of approximately $1,000,000, the Company only considered 50%
of the earn-out in the purchase price, mainly due to the reorganization of Virtuoso. The Virtuoso earn-out payments for 2016 amounted
to $64,736 in cash and 12,408 shares of common stock as compared to the potential earn-out of $231,968 under the purchase agreement.
The total purchase price of $1,831,881
was allocated to intangibles of $0.9 million, taking into consideration projected revenue from the acquired list of Virtuoso customers
over a period of three years, and the balance was allocated to goodwill.
For this acquisition, the net cash outflow
in 2016 was $563,000.
F-
10
Acquisition of DC&M
On July 29, 2016, we acquired 100% of the
membership interests of DC&M Partners, L.L.C. ("DCM"), an Arizona limited liability company, pursuant to the terms
of a Membership Interest Purchase Agreement by and among us, DCM, all of the members of DCM, Giri Devanur and Srinidhi "Dev"
Devanur, our President and Chief Executive Officer and Executive Vice Chairman, respectively. DCM is a SAP consulting company headquartered
in Chandler, Arizona. DCM provides its clients with a wide range of information technology development, consultancy and management
services with an emphasis on the design, build and rollout of SAP implementations and related products. DCM is also a SAP-certified
software partner, having launched its SAP reporting, extraction and distribution tool called "IRIS". DCM services clients
in diverse industries, including retail, apparel/footwear, third-party logistics providers, chemicals, consumer goods, energy,
high-tech electronics, media/entertainment and aerospace.
The aggregate purchase price for the acquisition
of DCM was $15,816,000, consisting of:
(a)
A cash payment in the amount of $3,000,000 at closing;
(b)
1,600,000 shares of our common stock (valued at approximately
$10.4 million based on the $6.51 closing price of our common stock on the closing date of the acquisition), which are to be issued
on July 29, 2018 or upon a change 	of control of our company (whichever occurs earlier); and
(c)
Earn-out payments of $1,500,000 payable in cash each
year to be paid, if earned, through the 	achievement of annual revenue and gross margin targets in 2017 and 2018. We estimate
the earn-	out payments will be earned at 100% of the targets set forth in the purchase agreement.
The total purchase price of $15,816,000
was allocated to intangibles of $5.4 million, taking into consideration projected revenue from the acquired list of DCM customers
over a period of three years, and the balance was allocated to goodwill. For this acquisition, the net cash outflow in 2016 was
$3,000,000.
Acquisition of Linear Logics, Corp.
In April 2015, the Company purchased all
of the assets and liabilities of Linear Logics, Corp. for approximately $1 million, which was to be paid in cash and Company stock.
In 2016, the Company paid $330,000 in cash toward the payment of the purchase price.
Presented below is the summary of the foregoing
acquisitions:
Allocation of purchase price in millions of U.S. dollars
Asset Component
Ameri Georgia
Bigtech
Virtuoso
DCM
Intangible Assets
1.8
0.6
0.9
5.4
Goodwill
3.5
0.3
0.9
10.4
Working Capital
Current Assets
Cash
1.4
-
-
-
Accounts Receivable
5.6
-
-
-
Other Assets
0.2
-
-
-
7.3
-
-
-
Current Liabilities
Accounts Payable
1.3
-
-
-
Accrued Expenses & Other Current Liabilities
1.3
-
-
-
2.7
-
-
-
Net Working Capital Acquired
4.6
-
-
-
Total Purchase Price
9.9
0.9
1.8
15.8
F-
11
The table below sets forth revenue and
earnings information for each of our recent acquisitions.
Revenue and Earnings of Acquisitions
since the date of acquisition (in millions
        of U.S. dollars)
Ameri Georgia
Bigtech
Virtuoso
DCM
Year of acquisition
2015
2016
2016
2016
Revenue
8.6
0.5
1.1
7.7
Earnings
1.0
0.0
0.2
0.3
The tables below
set forth supplemental pro forma revenue and earnings information with respect to our 2016 acquisitions as if the applicable acquisition
was made as of the first day of the period presented. The Company's 2016 acquisition of Bigtech is omitted from the pro form
information below, as Bigtech did not constitute a material acquisition for the Company and its impact on the revenue and earnings
of the Company are not material.
Supplemental Pro Forma Information
of Acquired Entities of
Ameri Holdings, Inc. for the
Year Ended December 31, 2016
(in millions of U.S. dollars)
Ameri Holdings, Inc.
Virtuoso
DCM
Total
Revenue
36.1
1.5
12.4
50.0
Earnings
(2.8)
0.1
1.0
(1.7)
Supplemental Pro Forma Information
of Acquired Entities of
Ameri Holdings, Inc. for the
Year Ended December 31, 2015
(in millions of U.S. dollars)
Ameri Holdings, Inc.
Virtuoso
DCM
Total
Revenue
20.3
3.2
17.9
41.4
Earnings
(0.8)
0.4
1.1
0.7
F-
12
NOTE 4.    REVENUE RECOGNITION:
The Company recognizes revenue primarily
through the provision of consulting services. We generate revenue by providing consulting services under written service contracts
with our customers. The service contracts we enter generally fall into two categories: (1) time-and-materials contracts and (2)
fixed-price contracts.
We consider amounts to be earned once evidence
of an arrangement has been obtained, services are delivered, fees are fixed or determinable and collectability is reasonably assured.
We establish billing terms at the time at which the project deliverables and milestones are agreed. Our standard payment terms
are 60 days from invoice date.
When a customer enters into a time-and-materials
or fixed-price (or a periodic retainer-based) contract, the Company recognizes revenue in accordance with its evaluation of the
deliverables in each contract. If the deliverables represent separate units of accounting, the Company then measures and allocates
the consideration from the arrangement to the separate units, based on vendor specific objective evidence of the value for each
deliverable.
The revenue under time and materials contracts
is recognized as services are rendered and performed at contractually agreed upon rates. Revenue pursuant to fixed-price contracts
is recognized under the proportional performance method of accounting. We routinely evaluate whether revenue and profitability
should be recognized in the current period. We estimate the proportional performance on our fixed-price contracts on a monthly
basis utilizing hours incurred to date as a percentage of total estimated hours to complete the project. This method is used because
reasonably dependable estimates of costs and revenue earned can be made, based on historical experience and milestones identified
in any particular contract. If we do not have a sufficient basis to measure progress toward completion, revenue is recognized upon
completion of performance, subject to any warranty provisions or other project management assessments as to the status of work
performed.
Estimates of total project costs are continuously
monitored during the term of an engagement. There are situations where the number of hours to complete projects may exceed our
original estimate, as a result of an increase in project scope, unforeseen events that arise, or the inability of the client or
the delivery team to fulfill their responsibilities. Accordingly, recorded revenues and costs are subject to revision throughout
the life of a project based on current information and historical trends. Such revisions may result in increases or decreases to
revenue and income and are reflected in the consolidated financial statements in the periods in which they are first identified.
If our initial estimates of the resources
required or the scope of work to be performed on a contract are inaccurate, or we do not manage the project properly within the
planned time period, a provision for estimated losses on incomplete projects may be made. Any known or probable losses on projects
are charged to operations in the period in which such losses are determined. A formal project review process takes place quarterly,
although projects are continuously evaluated throughout the period. Management reviews the estimated total direct costs on each
contract to determine if the estimated amounts are accurate, and estimates are adjusted as needed in the period identified. No
losses were recognized on contracts during the period ended December 31, 2016.
NOTE 5.    SHARE-BASED COMPENSATION:
On April 20, 2015, our Board of Directors
and the holder of a majority of our outstanding shares of common stock approved the adoption of our 2015 Equity Incentive Award
Plan (the "Plan") and a grant of discretionary authority to the executive officers to implement and administer the Plan.
The Plan allows for the issuance of up to 2,000,000 shares of our common stock for award grants (all of which can be incentive
stock options). The Plan provides equity-based compensation through the grant of cash-based awards, nonqualified stock options,
incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance units
and other stock-based awards. We believe that an adequate reserve of shares available for issuance under the Plan is necessary
to enable us to attract, motivate and retain key employees and directors and to provide an additional incentive for such individuals
through stock ownership and other rights that promote and recognize the financial success and growth of our Company. During the
twelve months ended December 31, 2016, we granted 982,700 options to employees. As of December 31, 2016, aggregate grants under
the Plan total 1,563,569 shares of our common stock.
F-
13
NOTE 6.    INCOME TAXES:
The provision for income taxes consists
of the following components for the years ended December 31:
2016
2015
Current:
Federal and state
$
(355,243
)
$
60,040
Foreign
96,357
—
Total current provision
(258,886
)
60,040
Deferred:
Federal and state
(3,488,960
)
(979,006
)
Foreign
—
—
Valuation allowance
—
790,506
Total deferred benefit
(3,488,960
)
(188,500
)
Total provision for income taxes
$
(3,747,846
)
$
(128,460
)
The Company recorded a tax provision (benefit)
of $(3,747,846) and $(128,460) for the periods ended December 31, 2016 and December 31, 2015, respectively. The reported
tax provision (benefit) for the twelve-month periods ended December 31, 2016 and December 31, 2015 are based upon an
estimated annual effective tax rate of 34% for all such periods. The effective tax rates reflected our combined federal and
state income tax rates and the recognition of U.S. deferred tax liabilities for differences between the book and tax basis of goodwill.
We assess the reliability of our deferred
tax assets and assess the need for a valuation allowance on an ongoing basis. The periodic assessment of the net carrying value
of our deferred tax assets under the applicable accounting rules is highly judgmental. We are required to consider all available
positive and negative evidence in evaluating the likelihood that we will be able to realize the benefit of our deferred tax assets
in the future. Such evidence includes scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning
strategies and the results of recent operations. Since this evaluation requires consideration of events that may occur some years
into the future, there is significant judgment involved and our conclusion could be materially different should certain of our
expectations not transpire.
We have reviewed the tax positions taken,
or to be taken, in our tax returns for all tax years currently open to examination by a taxing authority. As of December 31,
2016, the gross amount of unrecognized tax benefits exclusive of interest and penalties was zero. We have identified no other uncertain
tax positions for which it is reasonably possible that the total amount of unrecognized tax benefits will significantly increase
or decrease within the twelve months ending December 31, 2017. We remain subject to examination until the statute of limitations
expires for each respective tax jurisdiction.
F-
14
NOTE 7.    INTANGIBLE ASSETS:
We amortize our intangible assets that
have finite lives using either the straight-line method or based on estimated future cash flows to approximate the pattern in which
the economic benefit of the asset will be utilized. Amortization expense was $1,309,842 and $164,750 during the twelve-month periods
ended December 31, 2016 and December 31, 2015 respectively. This amortization expense relates to customer lists, which expire
through 2020.
As of December 31, 2016, and December 31,
2015, the aggregate capitalized intangible assets of the Company were as follows:
December
31,
2016
December
31,
2015
Capitalized intangible assets
$
10,074,546
$
3,279,263
Accumulated amortization
1,309,842
164,750
Total intangible assets
$
8,764,704
$
3,114,513
The Company's amortization schedule is as follows:
Years ending December 31,
Amount
2017
$
2,464,184
2018
2,115,592
2019
1,748,250
2020
1,621,000
2021
815,678
Total
$
8,764,704
The Company has its own software products,
namely Simple APO, Langer Index and IBP. Total costs incurred for developing these products during the twelve months ended December
31, 2016 was $55,104 and have been capitalized and are being amortized over the useful life of the software products.
The Company's intangible assets consists
of the customer lists acquired from the Company's acquisition of WinHire Inc, Ameri Georgia, DCM, Virtuoso and Bigtech. The
products acquired from the acquisition of Linear Logics. Corp. and the amount spent on improving those products are also categorized
as intangible assets and are being amortized over the useful life of those products.
NOTE 8. GOODWILL:
Goodwill represents the excess of the aggregate
purchase price over the fair value of the net assets acquired in businesses combinations. Goodwill was comprised of the following
amounts:
December 31,
2016
December 31,
2015
Virtuoso
$
939,881
$
—
DCM
10,416,000
—
Bigtech
314,555
—
Ameri Consulting Service Pvt. Ltd.
1,948,118
—
Ameri Georgia
3,470,522
3,470,522
Total
$
17,089,076
$
3,470,522
F-
15
NOTE 9.    ACCRUED EXPENSES AND OTHER LIABILITIES:
Accrued expense and other liabilities as
of December 31, 2016 and December 31, 2015 consisted of the following:
December 31,
2016
December 31,
2015
Legal fee payable
$
386,497
$
338,946
Advances from customers
—
44,841
Tax payable
388,044
320,247
Audit fee payable
47,900
21,500
Other liabilities
145,524
310,784
Travelling & conveyance payable
16,358
1,010
Salaries & wages payable
8,044
—
Bonus payable
62,060
—
Consultancy fee payable
25,000
50,000
401(k) payable
—
3,486
Total
$
1,079,427
$
1,093,814
NOTE 10. FAIR VALUE MEASUREMENT:
We utilize the following valuation hierarchy
for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels
as follows:
·
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;
·
Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument; and
·
Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value.
A financial asset or liability's classification
within the hierarchy is determined based upon the lowest level input that is significant to the fair value measurement.
As of both December 31, 2016 and December
31, 2015 we had no financial assets and liabilities required to be measured on a recurring basis.
No financial instruments were transferred
into or out of Level 3 classification during the twelve-month period ended December 31, 2016 and 2015.
F-
16
NOTE 11.    EARNINGS (LOSS) PER SHARE:
A reconciliation of net income and weighted
average shares used in computing basic and diluted net income per share is as follows:
Twelve Months Ended
December 31,
2016
2015
Basic net income (loss) per share:
Net income (loss) applicable to common shares
$
(2,788,112
)
$
(814,075
)
Weighted average common shares outstanding
13,068,597
11,101,198
Basic net income (loss) per share of common stock
$
(0.21
)
$
(0.07
)
Diluted net income (loss) per share:
Net income (loss) applicable to common shares
$
(2,788,112
)
$
(814,075
)
Weighted average common shares outstanding
13,068,597
11,101,198
Dilutive effects of convertible debt, stock options and warrants
—
—
Weighted average common shares, assuming dilutive effect of stock options
13,068,597
11,101,198
Diluted net income (loss) per share of common stock
$
(0.21
)
$
(0.07
)
Share-based awards, inclusive of all grants
made under the Company's equity plans, for which either the stock option exercise price or the fair value of the restricted share
award exceeds the average market price over the period, have an anti-dilutive effect on earnings per share, and accordingly, are
excluded from the diluted computations for all periods presented.
During the twelve months ended December
31, 2016, we granted our directors and employees options to purchase 782,700 shares of our common stock and restricted stock units
for 507,680 shares of our common stock. As of December 31, 2016, we had outstanding options to purchase 972,700 shares of the Company's
common stock and restricted stock units for 590,869 shares of the Company's common stock, resulting in share-based awards for a
total of 1,563,569 shares of our common stock outstanding under the Plan leaving 436,431 share-based units available under the
Plan.
Due to the Company's net loss, potential
dilutive shares were not included in the calculation of diluted EPS on December 31, 2016, as it will have an antidilutive effect.
NOTE 12.    EMPLOYEE BENEFIT PLAN:
The Company has a 401(k)-tax deferred
savings plan (the "401(k) Plan") that is available to all employees who satisfy certain minimum hour requirements each
year. The Company matches 100% of the first 3% of a participant's salary contributed under the 401(k) Plan and 50% on the next
2% of each participant's salary contributed under the 401(k).
NOTE 13.    OPTIONS:
As of December 31, 2016 and December 31,
2015, the Company had issued and outstanding options to purchase 972,700 and 150,000 shares of our common stock, respectively.
On May 26, 2015, the Company issued an
option to purchase 100,000 shares of common stock to non-employee directors of the Company. Prior to this issuance, the Company
had not granted any option. This tranche of options vested on the anniversary of the grant date at an exercise price of $2.00 per
share and expires on May 26, 2021. This tranche of options was valued using the Black-Scholes pricing model. Significant assumptions
used in the valuation of this tranche of options include an expected term of 2.75 years, expected volatility of 50%, a date of
issue risk free interest rate of 1.53% and expected dividend yield of 0%. The aggregate value of these options on the grant date
was $36,304 and the option expense for December 31, 2016 and December 31, 2015 was determined to be $14,520 and $21,784, respectively.
As of December 31, 2016, no options had been exercised from this tranche of options.
F-
17
On November 16, 2015, the Company issued
an option to purchase 50,000 shares of common stock to an employee of the Company. This tranche of options was to vest in equal
installments over three years at an exercise price of $4.01 per share and was to expire on November 16, 2021. This tranche of options
was valued using the Black-Scholes pricing model. Significant assumptions used in the valuation of this tranche of options include
an expected term of 3.25 years, expected volatility of 50%, a date of issue risk free interest rate of 1.66% and expected dividend
yield of 0%. The aggregate value of these options on the grant date was $73,265 and the option expense for December 31, 2016 and
December 31, 2015 was determined to be $7,123 and $929. As of December 31, 2016, these options had been cancelled.
On January 22, 2016, the Company issued
an option to purchase 5,000 shares of common stock to an employee of the Company. This tranche of options was to vest in equal
installments over three years at an exercise price of $6.02 per share and was to expire on January 22, 2021. This tranche of options
was valued using the Black-Scholes pricing model. Significant assumptions used in the valuation of this tranche of options include
an expected term of 3.25 years, expected volatility of 50%, a date of issue risk free interest rate of 1.49% and expected dividend
yield of 0%. The aggregate value of these options on the grant date was $10,944 and the option expense for December 31, 2016 and
2015 was determined to be $854 and $0, respectively. As of December 31, 2016, these options had been cancelled.
On January 28, 2016, the Company issued
an option to purchase 100,000 shares of common stock to an employee of the Company. This tranche of options was to vest in equal
installments over three years at an exercise price of $6.02 per share and was to expire on January 28, 2021. This tranche of options
was valued using the Black-Scholes pricing model. Significant assumptions used in the valuation of this tranche of options include
an expected term of 3.25 years, expected volatility of 50%, a date of issue risk free interest rate of 1.40% and expected dividend
yield of 0%. The aggregate value of these options on the grant date was $218,314 and the option expense for December 31, 2016 and
2015 was determined to be $61,776 and $0, respectively. As of December 31, 2016, these options had been cancelled.
On May 10, 2016, the Company issued an
option to purchase 500,000 shares of common stock to a non-employee director of the Company. This tranche of options was to vests
(a) as to 166,667 shares on May 10, 2017, (b) as to a further 166,667 shares on May 10, 2018, and (c) as to the remaining 166,666
shares on May 10, 2019, at an exercise price of $6.00 per share and expires on May 10, 2022. This tranche of options was valued
using the Black-Scholes pricing model. Significant assumptions used in the valuation of this tranche of options include an expected
term of three years, expected volatility of 50%, a date of issue risk free interest rate of 0.57% and expected dividend yield of
0%. The value on the grant date of these options was $1,737,445 and the option expense for December 31, 2016 and 2015 was determined
to be $370,496 and $0, respectively. As of December 31, 2016, no options had been exercised from this tranche of options.
On June 28, 2016, the Company issued an
option to purchase 25,000 shares of common stock to a non-employee director of the Company. This tranche of options vests on the
anniversary of the grant date at an exercise price of $6.51 and expires on June 28, 2022. This tranche of options was valued using
the Black-Scholes pricing model. Significant assumptions used in the valuation of this tranche of options include an expected term
of three years, expected volatility of 50%, a date of issue risk free interest rate of 0.57% and expected dividend yield of 0%.
The value on the grant date of these options was $55,251 and the option expense for December 31, 2016 and 2015 was determined to
be $9,359 and $0, respectively. As of December 31, 2016, no options had been exercised from this tranche of options.
On September 8, 2016, the Company issued
options to employees of the Company to purchase 215,200 shares of common stock. These option grants vest over four years at an
exercise price of $6.51 per share and expire on September 8, 2020. This tranche of options was valued using the Black-Scholes pricing
model. Significant assumptions used in the valuation of this tranche of options include an expected term of four years, expected
volatility of 50%, a date of issue risk free interest rate of 0.57% and expected dividend yield of 0%. The value on the grant date
of these options was $546,318 and the option expense for December 31, 2016 and 2015 was determined to be $49,239 and $0, respectively.
As of December 31, 2016, no options had been exercised from this tranche of options.
F-
18
Number of Shares
Weighted Avg. Exercise Price
Options outstanding at December 31, 2015
150,000
2.67
Granted
982,700
$
6.79
Exercised
—
—
Cancelled / Expired
(160,000
)
5.41
Outstanding at December 31, 2016
972,700
$
6.38
As of December 31, 2016 and December 31, 2015 the outstanding
options had a weighted average remaining term and intrinsic value of 4.33 and 0 years and $500,000 and $0, respectively.
Outstanding and Exercisable Options
Average
Exercise
Price
Number
of
Shares
Remaining
Average
Contractual
Life
(in
years)
Exercise
Price
times
number
of
Shares
Weighted
Average
Exercise
Price
Intrinsic
Value
$
2.00
100,000
3.40
$
200,000
$
2.00
$
451,000
NOTE 14. WARRANTS:
Below is a table summarizing the Company's
outstanding warrants for the year ended December 31, 2016:
Number of Shares
Weighted Avg. Exercise Price
Weighted Avg. Remaining Term
Intrinsic Value
Outstanding at December 31, 2015
2,777,777
1.80
4.41
$
13,333,330
Granted
1,000,000
6.00
—
—
Exercised
1,111,111
1.80
—
—
Outstanding at December 31, 2016
2,666,666
1.80
3.90
$
15,444,440
For the year ended December 31, 2016 and December 31, 2015,
the Company incurred no warrants based expense.
NOTE 15.    RESTRICTED STOCK UNITS:
On August 4, 2015, the Company issued restricted
stock units for 83,189 shares of common stock to non-employee directors of the Company. Prior to this issuance there no restricted
stock unit grants had been made by the Company. This tranche of restricted stock units was valued at $3.51 per share, the market
value per share on the date of the grant, and vested on the anniversary of the grant date. The aggregate value of the restricted
stock units on the grant date was $291,994 and the restricted stock unit expense for December 31, 2016 and December 31, 2015 was
determined to be $172,797 and $119,197, respectively. As of December 31, 2016, 83,189 restricted stock units had vested.
On May 10, 2016, the Company issued restricted
stock units for 500,000 shares of common stock to a non-employee director. This tranche of restricted stock units was valued at
$7.00 per share, the market value per share on the date of the grant, and vests (a) as to 166,667 shares, on May 10, 2017, (b)
as to a further 166,667 shares, on May 10, 2018, and (c) as to the remaining 166,666 shares, on May 10, 2019, subject to the grantee
continuing to be a director of the Company through such date. The aggregate value of the restricted stock units on the grant date
of the restricted stock units was $3,500,000 and the restricted stock unit expense for December 31, 2016 was determined to be $746,348.
As of December 31, 2016, none of the foregoing restricted stock units had vested.
F-
19
On June 28, 2016, the Company issued restricted
stock units for 7,680 shares of common stock to a non-employee director. This tranche of restricted stock units was valued at $6.51
per share, the market value per share on the date of the grant, and vests on the anniversary of the grant date. The aggregate value
of the restricted stock units on the grant date of the restricted stock units was $49,997 and the restricted stock unit expense
for December 31, 2016 was determined to be $25,135. As of December 31, 2016, none of the foregoing restricted stock units had vested.
NOTE 16.    DEBT:
On July 1, 2016, the Company entered into
that certain Loan and Security Agreement (the "Loan Agreement"), with its wholly-owned subsidiaries Ameri and Partners
Inc and Bellsoft, Inc., as borrowers (the "Borrowers"), the Company and its wholly-owned subsidiaries Linear Logics,
Corp. and WinHire Inc serving as guarantors, the Company's Chief Executive Officer, Giri Devanur, serving as a validity guarantor,
and Sterling National Bank, N.A. (as lender and as agent, "Sterling"). The Company joined DCM, Virtuoso and ATCG as borrowers
under the Loan Agreement following their respective acquisition.
Under the Loan Agreement, the Borrowers
can borrow up to an aggregate of $10 million, which includes up to $8 million in principal for revolving loans (the "Revolving
Loans") for general working capital purposes, up to $2 million in principal pursuant to a term loan (the "Term Loan")
for the purpose of a permitted business acquisition and up to $200,000 for letters of credit. A portion of the proceeds of the
Loan Agreement were also used to repay the November 20, 2015 credit facility that was entered into between the Company, its wholly-owned
subsidiary Bellsoft, Inc. (Ameri Georgia) and Federal National Payables, Inc.
The maturity of the loans under the Loan
Agreement are as follows:
Revolving Loan Maturity
Date: July 1, 2019; provided, however, that the Revolving Loan Maturity Date will extend and renew automatically for successive
one-year terms on each anniversary of the initial Revolving Loan Maturity Date (each an "Anniversary Date") thereafter,
unless not less than sixty (60) days prior to any such Anniversary Date, written notice of non-renewal is given by either party
to the other, in which case the Revolving Loan Maturity Date will be such next Anniversary Date.
Term Loan Maturity Date:
The earliest of (a) the date following acceleration of the Term Loan and/or the Revolving Loans; (b) the Revolving Loan Maturity
Date; or (c) July 1, 2019.
Interest under the Loan Agreement is payable
monthly in arrears and accrues as follows:
(a)
in the case of Revolving Loans, a rate per annum equal to the sum of (i) the Wall Street Journal Prime Rate plus (ii) 2.00%;
(b)
in the case of the Term Loan, a rate per annum equal to the sum of (i) the Wall Street Journal Prime Rate plus (ii) 3.75%; and
(c)
in the case of other obligations of the Borrowers, a rate per annum equal to the sum of (i) the greater of (A) 3.25% or (B) Wall Street Journal Prime Rate plus (ii) 3.75%.
The Loan Agreement
also requires the payment of certain fees, including, but not limited to letter of credit fees and an unused Revolving Loans fee.
F-
20
The Loan Agreement
contains financial and other covenant requirements, including, but not limited to, financial covenants that require the Borrowers
to not permit capital expenditures above $150,000 in any fiscal year, maintain a fixed charge coverage ratio of not less than 2.00
to 1.00 and maintain certain debt to EBITDA ratios. The Loan Agreement also requires the Company and Borrowers to obtain Sterling's
consent before making any permitted acquisitions.
The principal
amount of the Term Loan will be repaid as follows: (i) equal consecutive monthly installments in the amount of $33,333.33 each,
paid on the first day of each calendar month and (ii) one final payment of the entire remaining principal balance, together with
all accrued unpaid interest on the Term Loan maturity date. The Company's outstanding balance with Sterling National Bank for the
Term Loan and Revolving Loans was $1,923,466 and $2,743,177, respectively, as of December 31, 2016.
The Company did
not fulfill certain of the financial covenants contained in its Loan Agreement with Sterling National Bank as of December 31, 2016.
Sterling National Bank waived the Company's non-compliance with the Loan Agreement through December 31, 2016 without penalty
or the payment of any fee by the Company.
Bigtech, which
was acquired as of July 1, 2016, had a term loan of $18,101 and a line of credit for $345,713 as of December 31, 2016. The Bigtech
line of credit is with the Indian bank HDFC Bank Limited and was entered into on June 3, 2015 for Bigtech's working capital
requirements. The line of credit is for up to $416,667 with an interest rate of 11.85% per annum and maturity in June 2030. The
Bigtech term loan accrues interest at the rate of 10.30% per annum and matures in 2020. Both the term loan and the line of credit
were already in place when the Company acquired Bigtech.
Short-term Debt:
The following summarizes our short-term debt balances as of
December 31:
2016
2015
Notes outstanding under revolving credit facility
$
3,088,890
$
1,235,935
Term loan - current maturities
405,376
—
Total short-term debt
$
3,494,266
$
1,235,935
Long-term Debt:
The following summarizes our long-term debt balances as of December
31:
2016
2015
Term loan, due 2019
$
1,941,567
$
—
Less:  Current maturities
405,376
—
Long-term debt, net of current maturities
$
1,536,191
$
—
The following represents the schedule of maturities of our long-term
debt:
Year
Amounts
2017
$
405,376
2018
405,376
2019
1,130,815
Total
$
1,941,567
F-
21
NOTE 17.    COMMITMENTS
AND CONTINGENCIES:
Operating
Leases
The Company's
principal facility is located in Princeton, New Jersey. The Company also leases office space in various locations with expiration
dates between 2016 and 2020. The lease agreements often include leasehold improvement incentives, escalating lease payments, renewal
provisions and other provisions which require the Company to pay taxes, insurance, maintenance costs, or defined rent increases.
All of the Company's leases are accounted for as operating leases. Rent expense is recorded over the lease terms on a straight-line
basis. Rent expense was $220,280 and $47,475 for the twelve months ended December 31, 2016 and December 31, 2015, respectively.
The increase during these periods is due to new office space that was leased by the Company in Princeton, New Jersey on July 1,
2015 and the addition of office space through the acquisition of DCM, Virtuoso and Bigtech.
The Company has
entered into an operating lease for its primary office facility in Princeton, New Jersey, which expires in July 2017. The future
minimum rental payments under these lease agreements are as follows:
Year ending December 31,
Amount
2017
$
251,512
2018
112,901
2019
79,478
2020
18,754
Total
$
462,645
F-
22
NOTE 18.    SUBSEQUENT EVENTS:
On January 27,
2017, the Company issued 33,333 shares of its common stock its legal counsel, Olshan Frome Wolosky LLP ("Olshan"), in
exchange for the cancellation of a portion of accrued and unpaid legal fees owed by the Company to Olshan.
The Company partnered
with NEC Corporation of America (NEC), in February 2017, to offer SAP HANA Migration services. Through this partnership, the Company
will offer solutions to its clients aspiring to make the transition from SAP ECC (on-premise) applications to SAP HANA applications.
NEC is a leading technology integrator providing integrated communications, analytics, security, biometrics and technology solutions.
On March 7, 2017,
the Company completed the sale and issuance of 8% Convertible Unsecured Promissory Notes (the "2017 Notes") for proceeds
to us of an aggregate of $1,250,000, to four accredited investors, including one of the Company's directors, Dhruwa N. Rai. The
2017 Notes were issued pursuant to Securities Purchase Agreements with each investor, pursuant to which each investor purchased
its 2017 Note from the Company. The 2017 Notes bear interest at 8% per annum until maturity in March 2020, with interest being
paid annually on the first, second and third anniversaries of the issuance of the 2017 Notes beginning in March 2018. From and
after an event of default and for so long as the event of default is continuing, the 2017 Notes will bear default interest at the
rate of 10% per annum. The 2017 Notes can be prepaid by the Company at any time without penalty.
The 2017 Notes
are convertible into shares of Ameri common stock at a conversion price of (i) in the event that any registration statement for
the public offering of common stock filed by the Company with the SEC in connection with an uplisting to a national stock exchange
is declared effective by the SEC on or prior to December 31, 2017, such price per share that is equal to 68% of the price per share
of common stock offered and sold pursuant to such registration statement, or (ii) if no such registration statement is declared
effective by December 31, 2017, such price per share that is equal to the weighted average closing price per share of the Company's
common stock for the 20 trading days immediately preceding December 31, 2017, subject to adjustment under certain circumstances.
The 2017 Notes rank junior to the Company's secured credit facility with Sterling National Bank. The 2017 Notes also include certain
negative covenants including, without the investors' approval, restrictions on dividends and other restricted payments and reclassification
of its stock.
F-
23
On March 10, 2017,
the Company acquired 100% of the shares of ATCG Technology Solutions, Inc. ("ATCG"), a Delaware corporation, pursuant
to the terms of a Share Purchase Agreement among the Company, ATCG, all of the stockholders of ATCG (the "Stockholders")
and the Stockholders' representative.  ATCG provides U.S. domestic, offshore and onsite SAP consulting services and
has its main office in Folsom, California. The aggregate purchase price for the acquisition of ATCG consisted of:
(a)
576,923 shares of our common stock, valued at approximately $3.8 million based on the closing price of our common stock on the closing date of the acquisition;
(b)
Unsecured promissory notes issued to certain of ATCG's selling Stockholders for the aggregate amount of $3,750,000 (which notes bear interest at a rate of 6% per annum and mature on June 30, 2018);
(c)
Earn-out payments in shares of Ameri common stock (up to an aggregate value of $1,200,000 worth of shares) to be paid, if earned, in each of 2018 and 2019 based on certain revenue and EBITDA targets as specified in the purchase agreement. The Company estimates those targets will be fully achieved; and
(d)
An additional cash payment of $55,687 for cash that was left in ATCG at closing.
The
total purchase price of $8,784,533 was allocated to intangibles of $3.75 million, taking into consideration projected
revenue from the acquired list of ATCG customers over a period of three years, and goodwill. The excess of total purchase price
over the intangibles allocation has been allocated to goodwill.
On March 13, 2017,
the Company announced a merger proposal for Ciber, Inc. ("Ciber"). The proposal was rejected by Ciber and the Company
did not further pursue a transaction with Ciber.
F-
24
AMERI HOLDINGS,
INC.
UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEETS
June 30,
2017
December 31,
2016
Assets
Current assets:
Cash and cash equivalents
$
1,041,133
$
1,379,887
Accounts receivable
8,720,203
8,059,910
Investments
82,908
82,908
Other current assets
907,501
542,237
Total current assets
10,751,745
10,064,942
Other assets:
Property and equipment, net
107,533
100,241
Intangible assets, net
11,058,035
8,764,704
Acquired goodwill
21,886,567
17,089,076
Deferred income tax assets, net
3,488,960
3,488,960
Total other assets
36,541,095
29,442,981
Total assets
$
47,292,840
$
39,507,923
Current liabilities:
Line of credit
4,105,454
3,088,890
Accounts payable
3,945,303
5,130,817
Other accrued expenses
2,813,292
2,165,088
Bank term loan
406,031
405,376
Consideration payable – cash
3,626,738
1,854,397
Consideration payable – equity
196,251
64,384
Dividend payable
499,965
—
Total current liabilities
15,593,034
12,708,952
Long- term liabilities:
Convertible notes
1,250,000
—
Bank term loan
1,333,718
1,536,191
Consideration payable – cash
3,502,500
2,711,717
Consideration payable – equity
11,993,722
10,887,360
Total long-term liabilities
18,079,940
15,135,268
Total liabilities
33,672,974
27,844,220
Stockholders' equity:
Preferred stock, $0.01 par value; 1,000,000 authorized, 373,708 issued and outstanding as of June 30, 2017 and 363,611 as of December 31, 2016
3,737
3,636
Common stock, $0.01 par value; 100,000,000 shares authorized, 14,650,412 and 13,885,972 issued and outstanding as of June 30, 2017 and December 31, 2016 respectively.
146,503
138,860
Additional paid-in capital
22,289,906
15,358,839
Accumulated deficit
(8,827,876
)
(3,833,588
)
Accumulated other comprehensive income (loss)
(4,276
)
(7,426
)
Non-controlling interest
(11,872
)
3,382
Total stockholders' equity
13,619,866
11,663,703
Total liabilities and stockholders' equity
$
47,292,840
$
39,507,923
See accompanying notes to the unaudited
condensed consolidated financial statements.
F-
25
AMERI HOLDINGS,
INC.
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
Three Months
Ended
June 30, 2017
Three Months
Ended
June 30, 2016
Six Months
Ended
June 30, 2017
Six Months
Ended
June 30, 2016
Revenue
$
12,268,259
$
6,686,938
$
24,609,186
$
13,699,902
Cost of revenue
9,935,468
5,169,538
18,975,045
10,926,845
Gross profit
2,332,791
1,517,400
5,634,141
2,773,057
Operating expenses
Selling and marketing
434,895
135,329
767,205
166,679
General and administration
4,405,377
1,977,510
7,106,522
3,696,100
Acquisition related expenses
175,136
239,815
384,480
615,220
Depreciation and amortization
825,657
101,385
1,514,757
213,013
Operating expenses
5,841,065
2,454,039
9,772,964
4,691,012
Operating income (loss)
(3,508,274
)
(936,639
)
(4,138,823
)
(1,917,955
)
Interest expenses
(164,343
)
(270,514
)
(255,149
)
(384,260
)
Changes in estimates
400,000
—
400,000
—
Other expense – net
8,624
(1,862
)
4,475
(2,161
)
Income (loss) before income taxes
(3,263,993
)
(1,209,015
)
(3,989,497
)
(2,304,376
)
Tax benefit / (provision)
—
—
—
—
Income after income taxes
(3,263,993
)
(1,209,015
)
(3,989,497
)
(2,304,376
)
Net income attributable to non-controlling interest
(15,388
)
—
(11,872
)
—
Net income (loss) attributable to the Company
(3,279,381
)
(1,209,015
)
(4,001,369
)
(2,304,376
)
Dividend on preferred stock
(504,826
)
—
(1,004,791
)
—
Net loss attributable to common stock holders
(3,784,207
)
(1,209,015
)
(5,006,160
)
(2,304,376
)
Other comprehensive income (loss), net of tax
Foreign exchange translation
(2,185
)
(2,808
)
3,150
(65,698
)
Comprehensive income/(loss)
$
(3,786,392
)
$
(1,211,823
)
$
(5,003,010
)
$
(2,370,074
)
Comprehensive income/(loss) attributable to the Company
(3,771,004
)
(1,211,823
)
(4,991,138
)
(2,370,074
)
Comprehensive income/(loss) attributable to the non-controlling interest
(15,388
)
—
(11,872
)
—
(3,786,392
)
(1,211,823
)
(5,003,010
)
(2,370,074
)
Basic income (loss) per share
$
(0.26
)
$
(0.09
)
$
(0.35
)
$
(0.19
)
Diluted income (loss) per share
$
(0.26
)
$
(0.09
)
$
(0.35
)
$
(0.19
)
Basic weighted average number of common shares outstanding
14,610,609
12,845,057
14,352,573
12,359,709
Diluted weighted average number of common shares outstanding
14,610,609
12,845,057
14,352,573
12,359,709
See accompanying notes to the unaudited
condensed consolidated financial statements.
F-
26
AMERI HOLDINGS,
INC.
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
Six Months
Ended
June 30,
2017
2016
Cash flow from operating activities
Comprehensive income/(loss)
$
(5,003,010
)
$
(2,370,074
)
Adjustment to reconcile comprehensive income/(loss) to net cash used in operating activities
Depreciation and amortization
1,514,757
213,013
Provision for Preference dividend
1,004,791
—
Changes in estimate of contingent consideration
(400,000
)
—
Stock, option, restricted stock unit and warrant expense
2,470,980
443,705
Foreign exchange translation adjustment
3,150
—
Changes in assets and liabilities:
Increase (decrease) in:
Accounts receivable
(660,293
)
738,512
Other current assets
(365,264
)
(137,412
)
Increase (decrease) in:
Accounts payable and accrued expenses
(266,100
)
946,105
Net cash provided by (used in) operating activities
(1,700,989
)
(166,151
)
Cash flow from investing activities
Purchase of fixed assets
(7,800
)
(130,394
)
Acquisition consideration
(694,711
)
(3,232,168
)
Investments
—
82,908
Net cash used in investing activities
(702,511
)
(3,279,654
)
Cash flow from financing activities
Proceeds from bank loan and convertible notes
2,064,746
171,434
Additional stock issued
—
5,000,000
Non-controlling interest
—
—
Net cash provided by financing activities
2,064,746
5,171,434
Net increase (decrease) in cash and cash equivalents
(338,754
)
1,725,629
Cash and cash equivalents as at beginning of the period
1,379,887
1,878,034
Cash at the end of the period
$
1,041,133
$
3,603,663
See accompanying notes to the unaudited
condensed consolidated financial statements.
F-
27
AMERI HOLDINGS,
INC.
NOTES TO UNAUDITED
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 2017
NOTE 1.	   ORGANIZATION:
AMERI
Holdings, Inc. is a fast-growing technology services company which provides SAP cloud, digital and enterprise services to clients
worldwide. Headquartered in Princeton, New Jersey Ameri100 has offices in the U.S. and Canada.  The Company additionally has
global delivery centers in India. With its bespoke engagement model, Ameri100 delivers transformational value to its clients across
industry verticals.
NOTE 2.	   BASIS OF PRESENTATION:
The
accompanying unaudited condensed consolidated financial statements have been prepared by the Company in accordance with generally
accepted accounting principles in the United States of America, or U.S. GAAP, and Article 10 of Regulation S-X under the Securities
Exchange Act of 1934, as amended. Certain information and disclosure notes normally included in annual financial statements prepared
in accordance with accounting principles generally accepted in the United States of America have been omitted pursuant to those
rules and regulations, although we believe that the disclosures made are adequate to ensure the information presented is not misleading.
The
accompanying unaudited condensed consolidated financial statements reflect all adjustments (which were of a normal, recurring nature)
that, in the opinion of management, are necessary to present fairly our financial position, results of operations and cash flows
as of and for the interim periods presented. All intercompany transactions have been eliminated in the accompanying unaudited condensed
consolidated financial statements.
Our
comprehensive income (loss) consists of net income (loss) plus or minus any periodic currency translation adjustments.
The
Company's year-end is December 31. Ameri and Partners Inc, the Company's wholly-owned operating subsidiary that was
the accounting acquirer in connection with the Company's May 2015 reverse merger, changed its fiscal year end from March
31 to December 31 pursuant to the merger, so that all of the Company's subsidiaries' year-ends are consistent with
the year-end of the Company.
During
the first quarter of 2016, the Company erroneously classified approximately $1.9 million of expenses as general and administrative
expenses which should have been classified as cost of revenue. The Company has corrected this error in its Quarterly Report on
Form 10-Q for the quarter ended March 31, 2017. The reclassification did not change the Company's net income or loss for
the period reported.
The
results for the interim periods presented are not necessarily indicative of the results expected for any future period. The following
information should be read in conjunction with the audited financial statements and notes thereto included in our Annual Report
on Form 10-K for the fiscal year ended December 31, 2016.
Recent Accounting
Pronouncements
New Standards to Be Implemented
In
May 2014, the Financial Accounting Standards Board (the "FASB") issued Accounting Standards Update ("ASU")
2014-09, "Revenue from Contracts with Customers (Topic 606)," which supersedes the revenue recognition requirements
in "Revenue Recognition (Topic 605)." This ASU requires an entity to recognize revenue when goods are transferred or
services are provided to customers in an amount that reflects the consideration to which the entity expects to be entitled to in
exchange for those goods or services. This ASU also requires disclosures enabling users of financial statements to understand the
nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In August 2015, the FASB
issued ASU 2015-14, "Revenue from Contracts with Customers (Topic 606), deferral of the Effective Date." With the issuance
of ASU 2015-14, the new revenue guidance ASU 2014-09 will be effective for annual periods, and interim periods within those annual
periods, beginning after December 15, 2018, using one of two prescribed retrospective methods. In April 2016, the FASB issued ASU
2016-10, "Revenue from Contracts with Customer (Topic 606), Identifying Performance Obligations and Licensing." The
guidance is applicable from the date of applicability of ASU 2014-09. This ASU finalizes the amendments to the guidance on the
new revenue standard on the identification of performance obligations and accounting for licenses of intellectual property. In
December 2016, the FASB issued ASU 2016-20, "Technical Corrections and Improvements (Topic 606)" which is applicable
from the date of applicability of ASU 2014-09. This guidance provides optional exemptions from the disclosure requirement for remaining
performance obligations for specific situations in which an entity need not estimate variable consideration to recognize revenue.
In May 2016, FASB issued ASU No. 2016-12, "Narrow-Scope Improvements and Practical Expedients". This amendment clarified
certain aspects of Topic 606 and will be applicable from the date of applicability of ASU 2014-09. The Company is in process of
evaluating the impact of the foregoing updates.
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28
In
February 2016, the FASB issued ASU No. 2016-02, "Leases (Topic 842)". This new standard replaces the existing guidance
on leases and requires the lessee to recognize a right-of-use asset and a lease liability for all leases with lease terms equal
to or greater than twelve months. For finance leases, the lessee would recognize interest expense and amortization of the right-of-use
asset, and for operating leases, the lessee would recognize total lease expense on a straight-line basis. This standard is effective
for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2018. Upon adoption, entities
will be required to use a modified retrospective transition which provides for certain practical expedients. Entities are required
to apply the new standard at the beginning of the earliest comparative period presented. Early adoption of this new standard is
permitted. The Company is currently evaluating the effect this new standard will have on its consolidated financial statements
and related disclosures. The Company does not expect the requirement to recognize a right-of-use asset and a lease liability for
operating leases to have a material impact on the presentation of its consolidated statements of financial position.
In
August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash
Payments (ASU 2016-15), which clarifies how companies present and classify certain cash receipts and cash payments in the statement
of cash flows. The guidance is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal
years. Based on its current assessment, the Company does not expect the adoption of this update to have a material impact on its
consolidated financial statements.
On
November 17, 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash, which is intended to reduce
diversity in the presentation of restricted cash and restricted cash equivalents in the statement of cash flows. This new standard
requires that restricted cash and restricted cash equivalents be included as components of total cash and cash equivalents as presented
on the statement of cash flows. As a result, entities will no longer present transfers between cash and cash equivalents and restricted
cash and restricted cash equivalents in the statement of cash flows. ASU 2016-18 is effective for annual periods beginning after
December 15, 2017 including interim periods within those fiscal years, but earlier adoption is permitted.  The Company does
not believe the adoption of this new standard will have a material impact on its consolidated financial statements.
In
January 2017, the FASB issued ASU No. 2017-04, simplifying the Test for Goodwill Impairment. Under this new standard, goodwill
impairment would be measured as the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed
the carrying value of goodwill. This ASU eliminates existing guidance that requires an entity to determine goodwill impairment
by calculating the implied fair value of goodwill by hypothetically assigning the fair value of a reporting unit to all of its
assets and liabilities as if that reporting unit had been acquired in a business combination. This update is effective for annual
periods beginning after December 15, 2019, and interim periods within those periods. Early adoption is permitted for interim or
annual goodwill impairment test performed on testing dates after January 1, 2017. The Company is in process of evaluating the impact
of these updates.
In
January 2017, the FASB issued ASU No. 2017-01, clarifying the Definition of a Business, which clarifies and provides a more robust
framework to use in determining when a set of assets and activities is a business. The amendments in this update should be applied
prospectively on or after the effective date. This update is effective for annual periods beginning after December 15, 2017 and
interim periods within those periods. Early adoption is permitted for acquisition or deconsolidation transactions occurring before
the issuance date or effective date and only when the transactions have not been reported in issued or made available for issuance
financial statements. The Company does not believe the adoption of this new standard will have a material impact on its consolidated
financial statements.
F-
29
Standards Implemented
In
September 2015, the FASB issued ASU No. 2015-16, "Simplifying the Accounting for Measurement-Period Adjustments". The
guidance eliminates the requirement that an acquirer in a business combination account for a measurement period adjustment retrospectively.
Instead, an acquirer will recognize a measurement period adjustment during the period in which the amount of the adjustment is
determined. In addition, the portion of the amount recorded in current period earnings by line item that would have been recorded
in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date should
be presented separately on the face of the income statement or disclosed in the notes. This guidance was effective for fiscal years
beginning after December 15, 2015, including interim periods within those fiscal years. This guidance did not have a material impact
on the Company's consolidated financial results.
In
March 2016, the FASB issued ASU No. 2016-09, "Compensation – Stock Compensation". The new guidance changes the
accounting for share based payment transactions, including the income tax consequences, classification of awards as either equity
or liabilities and classification in the Consolidated Statement of Cash Flows. The guidance is effective for annual periods beginning
after December 15, 2016, and interim periods within those annual periods. This guidance did not have a material impact on the Company's
consolidated financial results.
NOTE 3.	   BUSINESS COMBINATIONS
Acquisition
of Ameri Georgia
On
November 20, 2015, we completed the acquisition of Bellsoft, Inc., a consulting company based in Lawrenceville, Georgia with over
175 consultants specialized in the areas of SAP software, business intelligence, data warehousing and other enterprise resource
planning services. Following the acquisition, the name of Bellsoft, Inc. was changed to Ameri100 Georgia Inc. ("Ameri Georgia").
Ameri Georgia has operations in the United States, Canada and India. For financial accounting purposes, we recognized September
1, 2015 as the effective date of the acquisition. The total consideration for the acquisition of Ameri Georgia was $9,910,817,
consisting of:
(a)
A cash payment in the amount of $3,000,000, which was paid at closing;
(b)
235,295 shares of our common stock issued at closing;
(c)
$250,000 quarterly cash payments paid on the last day of each calendar quarter of 2016;
(d)
A $1,000,000 cash reimbursement paid 5 days following closing to compensate Ameri Georgia for a
portion of its approximate cash balance as of September 1, 2015;
(e)
Approximately $2,910,817 paid within 30 days of closing in connection with the excess of Ameri
Georgia's accounts receivable over its accounts payable as of September 1, 2015; and
(f)
Earn-out payments of approximately $500,000 a year for 2016 and 2017, if earned through the achievement
of annual revenue and earnings before interest, taxes depreciation and amortization ("EBITDA") targets specified in
the purchase agreement, subject to downward or upward adjustment depending on actual results.
The
earn-out for 2016 was 30% higher than the previously agreed targets, resulting in a higher than anticipated earn-out payment, and
the excess of the 2016 earn-out payment over what was planned was made as an adjustment to our income statement.
F-
30
The
valuation of Ameri Georgia was made on the basis of its projected revenues. The accounting acquisition date for Ameri Georgia was
determined on the basis of the date when the Company acquired control of Ameri Georgia, in accordance with FASB codification ASU
805-10-25-6 for business combinations. That ASU provides that the date on which the acquirer obtains control of the acquiree generally
is the date on which the acquirer legally transfers the consideration, acquires the assets, and assumes the liabilities of the
acquiree—the closing date. However, the acquirer might obtain control on a date that is either earlier or later than the
closing date. For example, the acquisition date precedes the closing date if a written agreement provides that the acquirer obtains
control of the acquiree on a date before the closing date. An acquirer shall consider all pertinent facts and circumstances in
identifying the acquisition date.  The term sheet and the Share Purchase Agreement that were entered into by the Company and
Ameri Georgia contained agreements by the parties that the Company acquired control of Ameri Georgia's accounts payable,
accounts receivable and business decisions as of September 1, 2015. In addition, on that date, the Company became responsible for
performance of Ameri Georgia's existing contracts. Accordingly, the Company has recognized September 1, 2015 as the accounting
acquisition date.
The
total purchase price of $9,910,817 was allocated to net working capital of $4.6 million, intangibles of $1.8 million, taking into
consideration projected revenue from the acquired list of Ameri Georgia customers over a period of three years, and goodwill. The
excess of total purchase price over the net working capital and intangibles allocations has been allocated to goodwill.
The
Company paid $261,876 in cash to the former shareholders of Ameri Georgia as earn-out payments during the six months ended June
30, 2017.
Acquisition
of Bigtech Software Private Limited
On
June 23, 2016, we entered into a definitive agreement to acquire Bigtech Software Private Limited ("Bigtech"), a pure-play
SAP services company providing a wide range of SAP services including turnkey implementations, application management, training
and basis ABAP support. Based in Bangalore, India, Bigtech offers SAP services to improve business operations at companies of all
sizes and verticals. The acquisition of Bigtech was effective as of July 1, 2016, and the total consideration for the acquisition
of Bigtech was $850,000, consisting of:
(a)
A cash payment in the amount of $340,000, which was due within 90 days of closing and was paid on September 22, 2016;
(b)
Warrants for the purchase of 51,000 shares of our common stock (valued at approximately $250,000 based on the $6.51 closing
price of our common stock on the closing date of the acquisition), with such warrants exercisable for two years; and
(c)
$255,000, which may become payable in cash earn-outs to the sellers of Bigtech, if Bigtech achieves certain pre-determined
revenue and EBITDA targets in 2017 and 2018. We estimate the earn-out payments to be earned at 100% of the targets set forth in
the purchase agreement.
Bigtech's
financial results are included in our condensed consolidated financial results starting July 1, 2016.  The Bigtech acquisition
did not constitute a significant acquisition for the Company. The valuation of Bigtech was made on the basis of its projected
revenues.
The
total purchase price of $850,000 was allocated to intangibles of $595,000, taking into consideration projected revenue from the
acquired list of Bigtech customers over a period of three years, and goodwill. The excess of total purchase price over the intangibles
allocation has been allocated to goodwill.  The Bigtech acquisition did not constitute a significant acquisition for the Company.
F-
31
Acquisition
of Virtuoso
On
July 22, 2016, we, through wholly-owned acquisition subsidiaries, acquired all of the outstanding membership interests of Virtuoso,
L.L.C. ("Virtuoso"), a Kansas limited liability company, pursuant to the terms of an Agreement of Merger and Plan of
Reorganization, by and among us, Virtuoso Acquisition Inc., Ameri100 Virtuoso Inc., Virtuoso and the sole member of Virtuoso (the
"Sole Member"). Virtuoso is a SAP consulting firm specialized in providing services on SAP S/4 HANA finance, enterprise
mobility and cloud migration and is based in Leawood, Kansas. In connection with the merger, Virtuoso's name was changed
to Ameri100 Virtuoso Inc. The Virtuoso acquisition did not constitute a significant acquisition for the Company.
The
total purchase price paid to the Sole Member for the acquisition of Virtuoso was $1,831,881 consisting of:
(a)
A cash payment in the amount of $675,000, which was due within 90 days of closing and was paid on October 21, 2016;
(b)
101,250 shares of our common stock at closing, valued at approximately $700,000 based on the $6.51 closing price of our common
stock on the closing date of the acquisition; and
(c)
Earn-out payments in cash and stock of $450,000 and approximately $560,807, respectively, to be paid, if earned, through the
achievement of annual revenue and gross margin targets in 2017, 2018 and 2019. Out of the total contingent consideration of approximately
$1,000,000, we only considered 50% of the earn-out in the purchase price, mainly due to the reorganization of Virtuoso.
The
total purchase price of $1,831,881 was allocated to intangibles of $0.9 million, taking into consideration projected revenue from
the acquired list of Virtuoso customers over a period of three years, and the balance was allocated to goodwill.  The
Virtuoso earn-out payments for 2016 amounted to $64,736 in cash and 12,408 shares of common stock, which were delivered to the
Sole Member during the quarter ended June 30, 2017.
Acquisition
of Ameri Arizona
On
July 29, 2016, we acquired 100% of the membership interests of DC&M Partners, L.L.C. ("Ameri Arizona"), an Arizona
limited liability company, pursuant to the terms of a Membership Interest Purchase Agreement by and among us, Ameri Arizona, all
of the members of Ameri Arizona, Giri Devanur and Srinidhi "Dev" Devanur, our President and Chief Executive Officer
and Executive Vice Chairman, respectively. In July 2017, the name of DC&M Partners, L.L.C. was changed to Ameri100 Arizona
LLC. Ameri Arizona is a SAP consulting company headquartered in Chandler, Arizona. Ameri Arizona provides its clients with a wide
range of information technology development, consultancy and management services with an emphasis on the design, build and rollout
of SAP implementations and related products. Ameri Arizona is also a SAP-certified software partner, having launched its SAP reporting,
extraction and distribution tool called "IRIS". Ameri Arizona services clients in diverse industries, including retail,
apparel/footwear, third-party logistics providers, chemicals, consumer goods, energy, high-tech electronics, media/entertainment
and aerospace.
The
aggregate purchase price for the acquisition of Ameri Arizona was $15,816,000 consisting of:
(a)
A cash payment in the amount of $3,000,000 at closing;
(b)
1,600,000 shares of our common stock (valued at approximately $10.4 million based on the $6.51
closing price of our common stock on the closing date of the acquisition), which are to be issued on July 29, 2018 or upon a change
of control of our company (whichever occurs earlier); and
(c)
Earn-out payments of $1,500,000 payable in cash each year to be paid, if earned, through the achievement
of annual revenue and gross margin in 2017 and 2018.
F-
32
The
total purchase price of $15,816,000 was allocated to intangibles of $5.4 million, taking into consideration projected revenue from
the acquired list of Ameri Arizona customers over a period of three years, and the balance was allocated to goodwill.  Based
on the Company's current estimates of the consideration payable under the purchase agreement, the Company does not believe
the Ameri Arizona will achieve its earn-out for 2017 and has reduced the consideration payable estimates by $400,000
in its income statement for the quarter ended June 30, 2017. The Company is also currently negotiating with the former members
of Ameri Arizona regarding the Company's earn-out payment obligations.  The Company paid $300,000 in earn-out
payments during the quarter ended June 30, 2017 for earn-out amounts earned prior to such date.
Acquisition
of Ameri California
On
March 10, 2017, we acquired 100% of the shares of ATCG Technology Solutions, Inc. ("Ameri California"), a
Delaware corporation, pursuant to the terms of a Share Purchase Agreement among the Company, ATCG, all of the stockholders of Ameri
California (the "Stockholders"), and the Stockholders' representative. In July 2017, the name of ATCG Technology
Solutions, Inc. was changed to Ameri100 California Inc.  Ameri California provides U.S. domestic, offshore and onsite SAP
consulting services and has its main office in Folsom, California. Ameri California specializes in providing SAP Hybris, SAP Success
Factors and business intelligence services.
The
aggregate purchase price for the acquisition of Ameri California was $8,784,533, consisting of:
(a)
576,923 shares of our common stock, valued at approximately $3.8 million based on the closing price
of our Common Stock on the closing date of the acquisition;
(b)
Unsecured promissory notes issued to certain of Ameri California's selling Stockholders
for the aggregate amount of $3,750,000 (which notes bear interest at a rate of 6% per annum and mature on June 30, 2018);
(c)
Earn-out payments in shares of our common stock (up to an aggregate value of $1,200,000 worth of
shares) to be paid, if earned, in each of 2018 and 2019 based on certain revenue and EBITDA targets as specified in the purchase
agreement. We estimate those targets will be fully achieved; and
(d)
An additional cash payment of $55,687 for cash that was left in Ameri California at closing.
The
total purchase price of $8,784,533 was allocated to intangibles of $3.75 million, taking into consideration projected revenue from
the acquired list of Ameri California customers over a period of three years, and goodwill. The excess of total purchase
price over the intangibles allocation has been allocated to goodwill.
For
this acquisition, the net cash outflow in 2017 was $ 55,687.
Presented
below is the summary of the foregoing acquisitions:
Allocation of purchase price in millions of U.S. dollars
Asset Component
Ameri
Georgia
Bigtech
Virtuoso
Ameri
Arizona
Ameri
California
Intangible Assets
1.8
0.6
0.9
5.4
3.8
Goodwill
3.5
0.3
0.9
10.4
5.0
Working Capital
Current Assets
Cash
1.4
-
-
-
-
Accounts Receivable
5.6
-
-
-
-
Other Assets
0.2
-
-
-
-
7.3
-
-
-
-
Current Liabilities
Accounts Payable
1.3
-
-
-
-
Accrued Expenses & Other Current Liabilities
1.3
-
-
-
-
2.7
-
-
-
-
Net Working Capital Acquired
4.6
-
-
-
-
Total Purchase Price
9.9
0.9
1.8
15.8
8.8
F-
33
The
Company has $19,319,211, in total towards consideration payable including contingent consideration payable for its acquisitions,
consisting of $7,129,238 in cash obligations and $12,189,973 worth of common stock to be issued (assuming a per share price of
$6.51). Out of $19,319,211, $5,346,688 is towards contingent consideration payable on earn-outs.
NOTE 4.	   REVENUE RECOGNITION:
The
Company recognizes revenue primarily through the provision of consulting services. We generate revenue by providing consulting
services under written service contracts with our customers. The service contracts we enter generally fall into two categories:
(1) time-and-materials contracts and (2) fixed-price contracts.
We
consider amounts to be earned once evidence of an arrangement has been obtained, services are delivered, fees are fixed or determinable
and collectability is reasonably assured. We establish billing terms at the time at which the project deliverables and milestones
are agreed. Our standard payment terms are 60 days from invoice date.
When
a customer enters into a time-and-materials or fixed-price (or a periodic retainer-based) contract, the Company recognizes revenue
in accordance with its evaluation of the deliverables in each contract. If the deliverables represent separate units of accounting,
the Company then measures and allocates the consideration from the arrangement to the separate units, based on vendor specific
objective evidence of the value for each deliverable.
The
revenue under time and materials contracts is recognized as services are rendered and performed at contractually agreed upon rates.
Revenue pursuant to fixed-price contracts is recognized under the proportional performance method of accounting. We routinely evaluate
whether revenue and profitability should be recognized in the current period. We estimate the proportional performance on our fixed-price
contracts on a monthly basis utilizing hours incurred to date as a percentage of total estimated hours to complete the project.
This method is used because reasonably dependable estimates of costs and revenue earned can be made, based on historical experience
and milestones identified in any particular contract. If we do not have a sufficient basis to measure progress toward completion,
revenue is recognized upon completion of performance, subject to any warranty provisions or other project management assessments
as to the status of work performed.
Estimates
of total project costs are continuously monitored during the term of an engagement. There are situations where the number of hours
to complete projects may exceed our original estimate, as a result of an increase in project scope, unforeseen events that arise,
or the inability of the client or the delivery team to fulfill their responsibilities. Accordingly, recorded revenues and costs
are subject to revision throughout the life of a project based on current information and historical trends. Such revisions may
result in increases or decreases to revenue and income and are reflected in the consolidated financial statements in the periods
in which they are first identified.
If
our initial estimates of the resources required or the scope of work to be performed on a contract are inaccurate, or we do not
manage the project properly within the planned time period, a provision for estimated losses on incomplete projects may be made.
Any known or probable losses on projects are charged to operations in the period in which such losses are determined. A formal
project review process takes place quarterly, although projects are continuously evaluated throughout the period. Management reviews
the estimated total direct costs on each contract to determine if the estimated amounts are accurate, and estimates are adjusted
as needed in the period identified. No losses were recognized on contracts during the period ended June 30, 2017.
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34
NOTE 5.	   SHARE-BASED COMPENSATION:
On
April 20, 2015, our Board of Directors and the holder of a majority of our outstanding shares of common stock approved the adoption
of our 2015 Equity Incentive Award Plan (the "Plan"). The Plan allows for the issuance of up to 2,000,000 shares of
our common stock for award grants. The Plan provides equity-based compensation through the grant of cash-based awards, nonqualified
stock options, incentive stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares,
performance units and other stock-based awards. We believe that an adequate reserve of shares available for issuance under the
Plan is necessary to enable us to attract, motivate and retain key employees and directors and to provide an additional incentive
for such individuals through stock ownership and other rights that promote and recognize the financial success and growth of our
Company. We granted options to purchase 185,000 shares of our common stock and 98,669 restricted stock units pursuant to the Plan
during the six months ended June 30, 2017. Share based compensation expense for the period ended June 30, 2017 was $2,353,982.
During the current quarter 174,680 restricted stock units were cancelled and an accelerated cost of $792,764 due to such cancellation
has been accounted for as stock based compensation expense.  As of June 30, 2017, out of the 2,000,000 shares available under
the Plan, aggregate grants of 1,690,358 shares of our common stock had been granted as options and restricted stock units.
NOTE 6. 	INTANGIBLE ASSETS:
We
amortize our intangible assets that have finite lives using the straight-line method. Amortization expense was $1,459,592 during
the six months ended June 30, 2017. This amortization expense relates to customer lists and products capitalized on our balance
sheet, which expire through 2020.
As
of June 30, 2017, and December 31, 2016, capitalized intangible assets were as follows:
June 30,
2017
December 31,
2016
Capitalized intangible assets
$
12,517,627
$
10,074,546
Accumulated amortization
1,459,592
1,309,842
Total intangible assets
$
11,058,035
$
8,764,704
Our amortization
schedule is as follows:
Years ending December 31,
Amount
2017
$
1,470,513
2018
2,955,873
2019
2,727,968
2020
2,652,000
2021
1,251,681
Total
$
11,058,035
The
Company's intangible assets consist of the customer lists acquired from the Company's acquisition of WinHire Inc, Ameri
Georgia, Ameri Arizona, Virtuoso, Bigtech and Ameri California. The products acquired from the acquisition of Linear Logics. Corp.
and the amount spent on improving those products are also categorized as intangible assets and are being amortized over the useful
life of those products.
F-
35
NOTE 7.	   GOODWILL:
Goodwill
represents the excess of the aggregate purchase price over the fair value of the net assets acquired in business combinations. 
Goodwill was comprised of the following amounts:
June 30,
2017
December 31,
2016
Virtuoso
$
939,881
$
939,881
Ameri Arizona
10,416,000
10,416,000
Bigtech
299,803
314,555
Ameri Consulting Service Pvt. Ltd.
1,948,118
1,948,118
Ameri Georgia
3,470,522
3,470,522
Ameri California
4,812,243
—
Total
$
21,886,567
$
17,089,076
As
per Company policy, goodwill impairment tests will be conducted on an annual basis and any impairment will be reflected in the
Company's statements of operations.
NOTE 8.	   EARNINGS (LOSS) PER SHARE:
A
reconciliation of net income and weighted average shares used in computing basic and diluted net income per share is as follows:
2017
2016
Net income (loss) attributable to common stock holders
$
(5,006,160
)
$
(2,304,376
)
Weighted average common shares outstanding
14,352,573
12,359,709
Basic net income (loss) per share of common stock
$
(0.35
)
$
(0.19
)
Diluted net income (loss) per share of common stock
$
(0.35
)
$
(0.19
)
Share
based awards, inclusive of all grants made under the Plan, for which either the stock option exercise price or the fair value of
the restricted share award exceeds the average market price over the period, have an anti- dilutive effect on earnings per share,
and accordingly, are excluded from the diluted computations for all periods presented.
NOTE 9.   	OTHER ITEMS:
The
Company paid an in-kind dividend on its Series A Preferred Stock for the quarter ended March 31, 2017 by issuing 10,097 shares
of Series A Preferred Stock to the sole holder of the Company's Series A Preferred Stock. The Company has yet to make the
dividend payment on its Series A Preferred Stock which was payable on June 30, 2017.  The Company will pay the sole holder
of the Series A Preferred Stock the accrued dividend in-kind pursuant to the terms of the Certificate of Designation contemporaneously
with the filing of the Quarterly Report of Form 10-Q for the quarter ended June 30, 2017.
NOTE 10.   BANK DEBT:
On
July 1, 2016, the Company entered into a Loan and Security Agreement (the "Loan Agreement"), with its wholly-owned
subsidiaries Ameri and Partners Inc and Ameri Georgia, as borrowers (the "Borrowers"), the Company and its wholly-owned
subsidiaries Linear Logics, Corp. and WinHire Inc serving as guarantors, the Company's Chief Executive Officer, Giri Devanur,
serving as a validity guarantor, and Sterling National Bank, N.A. (as lender and as agent, "Sterling"). The Company
joined Ameri Arizona, Virtuoso and Ameri California as borrowers under the Loan Agreement following their respective acquisition.
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Under
the Loan Agreement, the Borrowers can borrow up to an aggregate of $10 million, which includes up to $8 million in principal for
revolving loans (the "Revolving Loans") for general working capital purposes, up to $2 million in principal pursuant
to a term loan (the "Term Loan") for the purpose of a permitted business acquisition and up to $200,000 for letters
of credit. A portion of the proceeds of the Loan Agreement were also used to repay the November 20, 2015 credit facility that was
entered into between the Company, its wholly-owned subsidiary Ameri Georgia and Federal National Payables, Inc.
The
maturity of the loans under the Loan Agreement are as follows:
Revolving
Loan Maturity Date: July 1, 2019; provided, however, that the Revolving Loan Maturity Date will extend and renew automatically
for successive one-year terms on each anniversary of the initial Revolving Loan Maturity Date (each an "Anniversary Date")
thereafter, unless not less than sixty (60) days prior to any such Anniversary Date, written notice of non-renewal is given by
either party to the other, in which case the Revolving Loan Maturity Date will be such next Anniversary Date.
Term
Loan Maturity Date: The earliest of (a) the date following acceleration of the Term Loan and/or the Revolving Loans; (b) the Revolving
Loan Maturity Date; or (c) July 1, 2019.
Interest
under the Loan Agreement is payable monthly in arrears and accrues as follows:
(a)
in the case of Revolving Loans, a rate per annum equal to the sum of (i) the Wall Street Journal
Prime Rate plus (ii) 2.00%;
(b)
in the case of the Term Loan, a rate per annum equal to the sum of (i) the Wall Street Journal
Prime Rate plus (ii) 3.75%; and
(c)
in the case of other obligations of the Borrowers, a rate per annum equal to the sum of (i) the
greater of (A) 3.25% or (B) Wall Street Journal Prime Rate plus (ii) 3.75%.
The
Loan Agreement also requires the payment of certain fees, including, but not limited to letter of credit fees and an unused Revolving
Loans fee.
The
Loan Agreement contains financial and other covenant requirements, including, but not limited to, financial covenants that require
the Borrowers to not permit capital expenditures above $150,000 in any fiscal year, maintain a fixed charge coverage ratio of not
less than 2.00 to 1.00 and maintain certain debt to EBITDA ratios. The Loan Agreement also requires the Company and Borrowers to
obtain Sterling's consent before making any permitted acquisitions.  The amounts borrowed by the Borrowers under the
Loan Agreement are guaranteed by the guarantors, and the Loan Agreement is secured by substantially all of the Borrowers'
assets.
The
principal amount of the Term Loan will be repaid as follows: (i) equal consecutive monthly installments in the amount of $33,333.33
each, paid on the first day of each calendar month and (ii) one final payment of the entire remaining principal balance, together
with all accrued unpaid interest on the Term Loan maturity date.
The
Company has not been in conformance with the financial covenants contained in its Loan Agreement with Sterling National Bank. 
The Company received a waiver from Sterling National Bank for its non-compliance with the Loan Agreement for the quarter ended
March 31, 2017 and June 30, 2017 in exchange for the payment of a fee of $5,000 for each quarterly waiver. The Company does not
expect to be in compliance with the terms of the Loan Agreement following the conclusion of the terms of the waivers granted by
Sterling National Bank. The Company is continuing to work with Sterling National Bank to address its non-compliance.
F-
37
If
we are unable to obtain future waivers from Sterling National Bank, the bank could declare our loans with it to be in default and
elect to claim all amounts outstanding to be immediately due and payable and terminate all commitments to extend further credit.
If we are unable to repay the outstanding amounts, Sterling National Bank could proceed against the collateral granted to it to
secure our indebtedness to it. We pledged substantially all of our assets as collateral under the Loan Agreement.  The Loan
Agreement is also supported by a limited guaranty from Giri Devanur, our President and Chief Executive Officer. If Sterling National
Bank accelerates the repayment of our loans, there is no assurance that we will have sufficient assets to repay the loans. A default
under the Loan Agreement may also result in an event of default under the Company's outstanding convertible notes. 
We are currently looking for additional sources of financing, however there is no guarantee that we will have additional financing
available to us.
Interest
paid on the Term Loan during the period ended June 30, 2017 amounted to $69,625. Principal repaid on the Term Loan during the period
ended June 30, 2017 was $200,000. The short term and long-term outstanding balances on the Term Loan as of June 30, 2017 was $399,996
and $1,323,470, respectively. The outstanding balance of the Revolving Loans as of June 30, 2017 was $3,794,042.
Bigtech,
which was acquired as of July 1, 2016, had a term loan of $16,283 and a line of credit for $311,412 as of June 30, 2017. The Bigtech
line of credit is with an Indian bank, HDFC Bank Limited, and was entered into on June 3, 2015 for Bigtech's working capital
requirements. The line of credit is for up to $416,667 with an interest rate of 11.85% per annum and maturity in June 2020. The
Bigtech term loan accrues interest at the rate of 10.30% per annum and matures in 2020. Both the term loan and the line of credit
were already in place when the Company acquired Bigtech. Interest paid during the period ended June 30, 2017 amounted to $20,543
for the term loan and line of credit held by Bigtech.
NOTE 11.	  CONVERTIBLE NOTES:
On
March 7, 2017, we completed the sale and issuance of 8% Convertible Unsecured Promissory Notes (the "2017 Notes") for
aggregate proceeds to us of $1,250,000 from four accredited investors, including one of the Company's directors, Dhruwa N.
Rai. The 2017 Notes were issued pursuant to Securities Purchase Agreements between the Company and each investor. The 2017 Notes
bear interest at 8% per annum until maturity in March 2020, with interest being paid annually on the first, second and third anniversaries
of the issuance of the 2017 Notes beginning in March 2018. From and after an event of default and for so long as the event of default
is continuing, the 2017 Notes will bear default interest at the rate of 10% per annum. The 2017 Notes can be prepaid by us at any
time without penalty.
The
2017 Notes are convertible into shares of our common stock at a conversion price of (i) in the event that any registration statement
for the public offering of common stock filed by the Company with the Securities and Exchange Commission (the "SEC")
in connection with an uplisting to a national stock exchange is declared effective by the SEC on or prior to December 31, 2017,
such price per share that is equal to 68% of the price per share of common stock offered and sold pursuant to such registration
statement, or (ii) if no such registration statement is declared effective by December 31, 2017, such price per share that is
equal to the weighted average closing price per share of the Company's common stock for the 20 trading days immediately
preceding December 31, 2017, subject to adjustment under certain circumstances. The 2017 Notes rank junior to our secured credit
facility with Sterling National Bank. The 2017 Notes also include certain negative covenants including, without the investors'
approval, restrictions on dividends and other restricted payments and reclassification of its stock.
F-
38
NOTE 12. 	 COMMITMENTS AND CONTINGENCIES:
Operating
Leases
The
Company's principal facility is located in Princeton, New Jersey. The Company also leases office space in various locations
with expiration dates between 2016 and 2020. The lease agreements often include leasehold improvement incentives, escalating lease
payments, renewal provisions and other provisions which require the Company to pay taxes, insurance, maintenance costs, or defined
rent increases. All of the Company's leases are accounted for as operating leases. Rent expense is recorded over the lease
terms on a straight-line basis. Rent expense was $ 151,797and $57,434 for the six months ended June 30, 2017 and 2016, respectively.
The increase during the comparative periods is due to the addition of office space through the acquisition of Ameri Arizona, Virtuoso,
Bigtech and Ameri California.
The
Company has entered into an operating lease for its primary office facility in Princeton, New Jersey, which expires in July 2019.
The future minimum rental payments under these lease agreements are as follows:
Year ending December 31,
Amount
2017
$
124,334
2018
140,828
2019
103,283
2020
70,333
2021
7,371
Total
$
446,149
NOTE 13. 	FAIR VALUE MEASUREMENT:
The group's
financial instruments consist primarily of cash and cash equivalent, accounts receivable, accounts payable, contingent consideration
liability and accrued liabilities. The carrying amounts of accounts receivable, accounts payable, cash and cash equivalents and
accrued liabilities are considered to be the same as their fair value, due to their short-term nature.
Fair
value is defined as the exchange price that would be received for an asset or an exit price paid to transfer a liability in the
principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement
date. Valuation techniques used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable
inputs. The current accounting guidance for fair value measurements defines a three-level valuation hierarchy for disclosures as
follows:
·
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities;
·
Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs
that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the
full term of the financial instrument; and
·
Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets and
liabilities at fair value.
A
financial asset or liability's classification within the hierarchy is determined based upon the lowest level input that is
significant to the fair value measurement.
F-
39
The
following table sets forth the financial assets, measured at fair value, by level within the fair value hierarchy as of June 30,
2017 and December 31, 2016:
June 30,
2017
December 31,
2016
Level 3
Contingent consideration
$
5,346,688
$
5,266,488
The
following table presents the change in level 3 instruments:
Three Months
Ended June 30,
2017
Six Months Ended
June 30, 2017
Opening balance
6,192,200
5,266,488
Additions during the period
$
—
$
1,200,000
Paid/settlements
(445,512
)
(719,800
)
Total gains recognized in Statement of Operations
(400,000
)
(400,000
)
Closing balance
5,346,688
5,346,688
Contingent
consideration pertaining to the acquisitions referred to in note 3 above as of June 30, 2017 has been classified under level 3
as the fair valuation of such contingent consideration has been done using one or more of the significant inputs which are not
based on observable market data.
The
fair value of the contingent consideration was estimated using a discounted cash flow technique with significant inputs that are
not observable in the market. The significant inputs not supported by market activity included our probability assessments
of expected future cash flows related to the acquisitions during the earn-out period, appropriately discounted considering the
uncertainties associated with the obligation, and calculated in accordance with the respective terms of the share purchase agreements.
The
amount of total gains/(losses) included in our Statement of Operations and Comprehensive Income/(Loss) is attributable to change
in fair value of contingent consideration arising from the acquisition of Ameri Arizona were $(400,000) and $0 for the quarter
ended June 30, 2017 and the year ended December 31, 2016, respectively.
NOTE 14.	  NON-CONTROLLING INTEREST:
The
subsidiaries of the Company are all direct or indirect wholly-owned subsidiaries, except for Bellsoft India Solutions Private Limited
("Bellsoft India") and Ameritas Technologies India Private Limited, of which the Company held 72% and 76% of the equity
of each company, respectively, through March 31, 2017.  On March 31, 2017, Ameri Georgia (parent of Bellsoft India) acquired
the remaining 28% of the equity of Bellsoft India held by minority shareholders for approximately $8,200. At the time of the acquisition,
the Company reversed the amount payable to non-controlling interest of $3,383 and the same amount was recorded as additional paid-in-capital.
The
Company attributes relevant gains and losses to such non-controlling interests for every financial year. During the three months
ended June 30, 2017, 2016, and the six months ended June 30, 2017, 2016 the profit attributable to the holders of non-controlling
interests amounted to $15,388 and $0 and $11,872 and $0, respectively.
F-
40
NOTE 15.	  SUBSEQUENT
EVENTS:
During
the third quarter of 2017, the Company began to streamline its operations following the acquisitions of Ameri Arizona and Ameri
California. This streamlining is expected to impact about 20 employees and will result in a restructuring charge of approximately
$80,000 in the quarter ending September 30, 2017. The Company anticipates that streamlining of its operations will result in annual
savings of approximately $1.5 million, inclusive of payroll, benefits, office consolidations and other ancillary employee related
costs.
F-
41
CERTIFIED PUBLIC ACCOUNTANTS
REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM
The Board of Directors and Stockholders
Bellsoft, Inc.
We have audited the
accompanying consolidated balance sheets of Bellsoft, Inc. (the "Company") as of December 31, 2014 and 2013 and the
related consolidated statements of operations, stockholders' equity and cash flows for the years then ended. These consolidated
financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audits.
We conducted our audits
in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the consolidated 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 controls over financial
reporting. Our audit 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 audits provide a reasonable basis for our opinion.
In our opinion, the
consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company
as of December 31, 2014 and 2013 and the results of its operations and its cash flows for the years then ended, in conformity with
accounting principles generally accepted in the United States of America.
/s/ Ram Associates
Ram Associates
Hamilton, NJ January 21, 2016.
3240 EAST STATE STREET, HAMILTON, NJ 08619
(609) 631-9552/631-9553+ FAX (888) 319-8898
PKRAM@RAMASSOCIATES.US
F-
42
BELLSOFT, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
December 31,
2014
2013
ASSETS
CURRENT ASSETS
Cash
$
1,209,793
$
2,309,919
Accounts receivable, net
4,232,603
2,873,991
Employee advances
7,114
5,500
Prepaid expenses
4,604
59,697
Other receivable
38,025
—
TOTAL CURRENT ASSETS
5,492,139
5,249,107
PROPERTY AND EQUIPMENT, NET
111,856
98,050
OTHER ASSETS
Security deposits
85,916
88,296
Note receivable from shareholder
—
220,000
Other assets
7,076
5,824
TOTAL OTHER ASSETS
92,992
314,120
TOTAL ASSETS
$
5,696,987
$
5,661,277
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable
$
1,150,862
$
731,825
Accrued expenses
1,477,099
1,127,963
Customer advances
89,770
211,969
Line of credit
500,000
1,750,000
Income tax payable
21,143
29,953
TOTAL CURRENT LIABILITIES
3,238,874
3,851,710
SHAREHOLDERS' EQUITY
Common stock, no par, authorized 10,000 shares,
issued and outstanding 750 shares
102,875
102,875
Retained earnings
2,396,321
1,694,266
Accumulated other comprehensive loss
(127,865
)
(68,904
)
Non-controlling interest
86,782
81,330
TOTAL SHAREHOLDERS' EQUITY
2,458,113
1,809,567
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
$
5,696,987
$
5,661,277
- See accompanying notes to consolidated
financial statements -
F-
43
BELLSOFT, INC. AND SUBSIDIARIES
Consolidated Statements of Income
and Comprehensive Income
Years Ended December 31
2014
2013
REVENUES
$
21,338,280
$
20,813,072
OPERATING EXPENSES
20,415,251
19,837,896
Income from operations
923,029
975,176
OTHER INCOME (EXPENSES)
Interest income
2,434
1,901
Loss on disposal of assets
(1,202
)
—
Interest expense
(28,578
)
(26,970
)
Unrealized gain on foreign currency
22,140
7,956
TOTAL OTHER EXPENSE
(5,206
)
(17,113
)
Income before income tax expense
917,823
958,063
Income tax expense
17,192
53,126
Net income
900,631
904,937
Net income/(loss), non-controlling interest
5,452
20,338
Net income, controlling interest
895,179
884,599
Other comprehensive income (loss):
Foreign currency translation adjustment
(58,961
)
(3,683
)
Comprehensive income
$
836,218
$
880,916
- See accompanying notes to consolidated
financial statements -
F-
44
BELLSOFT, INC. AND SUBSIDIARIES
Consolidated Statements of Changes in
Shareholders' Equity
Years Ended December 31, 2014 and 2013
Accumulated
Other
Total
Common
Non-Controlling
Comprehensive
Retained
Shareholders'
Stock
Interest
Loss
Earnings
Equity
Balance at December 31, 2012
102,875
$
60,992
$
(65,211
)
$
3,020,097
$
3,188,743
Net income
20,338
884,599
904,937
Shareholders' distributions
(2,210,430
)
(2,210,430
)
Foreign currency translation adjustment
(3,683
)
(3,683
)
Balance at December 31, 2013
102,875
81,330
(68,904
)
1,694,266
1,809,567
Net income
—
5,452
—
895,179
900,631
Shareholders' distributions
—
—
—
(193,124
)
(193,124
)
Foreign currency translation adjustment
—
—
(58,961
)
—
(58,961
)
Balance at December 31, 2014
102,875
$
86,782
$
(127,865
)
$
2,396,321
$
2,458,113
- See accompanying
notes to consolidated financial statements -
F-
45
BELLSOFT, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
Years Ended December 31,
2014
2013
CASH FLOWS FROM OPERATING ACTIVITIES
Net income
$
900,631
$
904,937
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation
24,040
47,320
Translation adjustment
(58,961
)
2,564
Changes in assets and liabilities: Accounts receivable
(1,358,612
)
190,598
Employee advances
(1,614
)
44,500
Prepaid expenses
55,093
(30,596
)
Other receivable
(38,025
)
—
Security deposits
2,380
10,061
Other assets
(1,252
)
(5,824
)
Accounts payable
419,037
(715,765
)
Accrued expenses
349,136
(147,232
)
Customer advances
(122,199
)
206,487
Income tax payable
(8,810
)
(11,559
)
Net cash provided by operating activities
160,844
495,491
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures
(37,846
)
(9,577
)
(Increase)/decrease in note receivable from shareholder
220,000
(50,000
)
Net cash provided by/(used in) investing activities
182,154
(59,577
)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase/(decrease) in line of credit
(1,250,000
)
1,750,000
Shareholders' distributions
(193,124
)
(2,210,430
)
Net cash used in financing activities
(1,443,124
)
(460,430
)
Net decrease in cash and cash equivalents
(1,100,126
)
(24,516
)
Cash at beginning of year
2,309,919
2,334,435
Cash at end of year
$
1,209,793
$
2,309,919
Supplemental disclosure:
Cash paid for interest
$
28,578
$
26,970
Cash paid for foreign income taxes
$
59,864
$
82,374
- See accompanying notes to consolidated
financial statements -
F-
46
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
NOTE 1 - NATURE OF OPERATIONS
Bellsoft, Inc. ("Bellsoft"),
was incorporated in the State of Georgia on March 19, 1996. The Company provides implementation and custom development services
for Enterprise Resource Planning (ERP) software.
On February 7, 2005,
Bellsoft acquired 72% ownership interest in Bellsoft India Solutions Private (Pvt) Limited (Ltd), a company incorporated under
the laws of India ("Bellsoft India"). The primary purpose of Bellsoft India is to provide back office and marketing
functions to Bellsoft, Inc. Bellsoft India's fiscal year ends on March 31st. For consolidation purposes Bellsoft India prepares
statements for the reporting period, which corresponds with the fiscal year of the parent.
On August 31, 2011,
Bellsoft formed BSI Global IT Solutions, Inc. (Bellsoft Canada), a company incorporated under the laws of Canada. The primary purpose
of Bellsoft Canada is to provide implementation and custom development services for ERP software for clients in Canada. Bellsoft
owns 100% of Bellsoft Canada.
Bellsoft India and
Bellsoft Canada are collectively referred to as the Subsidiaries. Bellsoft, Inc. and the Subsidiaries are collectively referred
to as the Company.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF CONSOLIDATION
The consolidated financial
statements include the accounts of the Subsidiaries. All material intercompany transactions and balances have been eliminated in
consolidation.
BASIS OF PRESENTATION
The Company has adopted
the Financial Accounting Standards Board ("FASB") Codification ("Codification" or "ASC"). The
Codification is the single official source of authoritative accounting principles generally accepted in the United States of America
("U.S. GAAP") recognized by the FASB to be applied by nongovernmental entities. All of the Codification's content
carries the same level of authority.
FOREIGN OPERATIONS AND FOREIGN CURRENCY
The Subsidiaries'
foreign operations are subject to risks inherent in operating under different legal systems and various political and economic
environments. Among the risks are changes in existing tax laws, possible limitations on foreign investment and income repatriation,
government price or foreign exchange controls, and restrictions on currency exchange. Net assets of foreign operations were approximately
19% and 12% of the Company's total net assets at December 31, 2014 and 2013, respectively. Cash held in foreign based bank
accounts totaled approximately $290,000 and $268,000 at December 31, 2014 and 2013.
The Subsidiaries transact
business in their local currencies. The financial statements reflect the translation of the functional currency statements to U.S.
Dollars. Financial statements use end-of-period exchange rates for assets and liabilities, weighted average exchange rates for
revenues and expenses, and historical rates for equity. The resulting foreign currency translation adjustment is recorded in accumulated
other comprehensive income (loss) as a component of equity.
F-
47
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
USE OF ESTIMATES
The preparation of
consolidated financial statements in conformity with U.S. GAAP 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. Actual results could differ from those
estimates.
REVENUE RECOGNITION
The Company recognizes
revenue in accordance with FASB ASC 985-605-25-79. Revenue is derived from time and expense contracts and is recognized as the
services are performed. Revenue received as reimbursements of billable expenses is reported on a gross basis within revenue and
the related expenses are recorded in operating expenses. Unbilled revenue is comprised of revenue recognized in relation to efforts
incurred on time and expense contracts not billed at a period end where services are performed in accordance with agreed terms.
Customer advances represent payments received in advance of an engagement and are deferred until the service is performed.
CASH AND CASH EQUIVALENTS
The Company considers
all highly liquid investments with an original maturity of three months or less to be cash equivalents.
ACCOUNTS RECEIVABLE
The Company routinely
assesses the financial strength of its customers and debtors and believes that its accounts receivable credit risk exposure is
limited. Accounts receivable are carried at the original invoice amount less an estimate made for doubtful receivables based on
a review of all outstanding amounts on a monthly basis. An allowance is provided for known and anticipated credit losses, as determined
by management in the course of regularly evaluating individual customer receivables. This evaluation takes into consideration a
customer's financial condition and credit history, as well as current economic conditions. Accounts receivable are considered
delinquent when they are over 90 days past due and are written off when deemed uncollectible. Recoveries of accounts receivable
previously written off are recorded in income when received.
PROPERTY AND EQUIPMENT
Property and equipment
are recorded at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives
of the assets, which range from 3 to 7 years.
Expenditures for maintenance
and repairs are charged to income as incurred. Additions and betterments are capitalized. The cost of properties sold or otherwise
disposed of, and the accumulated depreciation thereon, is eliminated from the property and reserve accounts, and gains and losses
are reflected in the consolidated statements of operations.
INCOME TAXES
Bellsoft has elected
to be taxed as an S corporation for income tax purposes effective January 1, 2002. Accordingly, the shareholders are responsible
for income taxes; therefore, no provision for income taxes is included in these financial statements for Bellsoft, Inc.
Bellsoft's policy
is to distribute dividends to provide funds for shareholders to pay income taxes on income reported by the Company. Periodically,
additional distributions are paid to reduce equity in excess of management's evaluation of the amount required for working
capital. Management believes the payment of additional distributions will not negatively impact profitability or impair the operating
needs of the Company. Equity distributions during the years ended December 31, 2014 and 2013 were $193,124 and $2,210,430, respectively.
F-
48
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
The Company accounts
for the effect of any uncertain tax positions based on a more likely than not threshold to the recognition of the tax positions
being sustained based on the technical merits of the position under scrutiny by the applicable taxing authority. If a tax position
or positions are deemed to result in uncertainties of those positions, the unrecognized tax benefit is estimated based on a cumulative
probability assessment that aggregates the estimated tax liability for all uncertain tax positions. Interest and penalties assessed,
if any, are accrued as income tax expense.
The Company has evaluated
its tax positions and determined no uncertainty requires recognition. The Company files income tax returns in the U.S. federal
jurisdiction, and various state jurisdictions, as well as the required foreign countries. The Company is generally no longer subject
to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2011.
ADVERTISING COSTS
Advertising costs are
charged to operations when incurred. Advertising expense were $25,069 and $54,429 for the years ended December 31, 2014 and 2013.
NOTE 3 - ACCOUNTS RECEIVABLE
Accounts receivable
as of December 31, 2014 and 2013 are summarized as follows:
Amounts due for services rendered and billed:
2014
2013
Outstanding less than 90 days
$
3,404,399
$
2,539,564
Outstanding more than 90 days
—
—
3,404,399
2,539,564
Less: allowance for doubtful accounts
(19,608
)
—
Amounts due for services rendered and billed, net
3,384,791
2,539,564
Amounts due for services rendered not billed:
847,812
334,427
Accounts receivable, net
$
4,232,603
$
2,873,991
NOTE 4 - PROPERTY AND EQUIPMENT
Property and equipment
consists of the following at December 31,
2014
2013
Computer equipment
$
169,329
$
180,262
Furniture and fixtures
50,321
73,006
Office premises - India
44,181
56,292
Software
72,988
90,019
Office equipment
70,235
110,392
Leasehold improvements
4,194
4,194
Fixed assets, gross
411,248
514,165
Less: accumulated depreciation
(299,392
)
(416,115
)
Fixed assets, net
$
111,856
$
98,050
Depreciation expense
for the years ended December 31, 2014 and 2013 were $24,040 and $47,320, respectively.
NOTE 5 - LINE OF CREDIT
Bellsoft had a revolving
line of credit based on an agreement dated May 13, 2011 with a current maturity date of October 30, 2015. The line of credit had
a maximum borrowing base of $2,000,000 with the interest rate at BBA Libor Daily Floating plus 2.75%. The line was secured by (1)
a shareholders' personal guaranty and (2) a lien on all business assets of the Borrower including, but not limited to, accounts
receivable, fixed assets and general intangible assets. The line of credit required Bellsoft, Inc. to meet certain financial and
non- financial covenants which is typical to such agreements.
F-
49
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
The outstanding balance
of the line of credit was $500,000 and $1,750,000 at December 31, 2014 and 2013, respectively. Interest was accrued at 2.919% at
December 31, 2014 and 2013. Total interest expense for the years ended December 31, 2014 and 2013 were $28,578 and $26,970, respectively.
The outstanding balance
of the line of credit was fully paid off and cancelled subsequent to the share purchase agreement entered into by the Company and
Ameri Holdings, Inc. (See Note 11).
NOTE 6 - INCOME TAXES
The Company accounts
for income taxes under the provisions of the FASB ASC 740, Income Taxes. Current income tax expense consists of the following for
the years ended December 31, 2014 and 2013:
Foreign income tax:
2014
2013
Canada
$
8,848
$
29,953
India
8,344
23,173
Total current income tax expense
$
17,192
$
53,126
In the ordinary course
of business, there are many intercompany transactions that affect the calculation and estimation of the Company's tax liability.
Although the Company's management believes that their tax estimates are reasonable, there is no assurance that the final
determination of tax liability will not be different from what is reflected in the Company's income tax provisions and accruals.
NOTE 7 - EMPLOYEE BENEFIT PLAN
Bellsoft maintains
a defined contribution 401K plan covering all eligible employees of Bellsoft, Inc. Employees 21 years of age are eligible to participate
in the plan after six months of service. Employees are allowed to contribute up to the maximum amount under the Internal Revenue
Code. The plan allows Bellsoft to make a discretionary match of employee contributions. During 2014 and 2013, Bellsoft contributed
$12,164 and $17,209, respectively, to the Plan.
NOTE 8 - RECENT ACCOUNTING PRONOUNCEMENTS
i) On May 28, 2014,
the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606), with an effective date
for annual reporting periods beginning after December 15, 2016, including interim periods within that reporting period, for public
business entities, certain not-for-profit entities, and certain employee benefit plans. The effective date for all other entities
was for annual reporting periods beginning after December 15, 2017, and interim periods within annual periods beginning after December
15, 2018.
The amendments in this
Update defer the effective date of Update 2014-09. Public business entities, certain not-for-profit entities, and certain employee
benefit plans should apply the guidance in Update 2014-09 to annual reporting periods beginning after December 15, 2017, including
interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning
after December 15, 2016, including interim reporting periods within that reporting period.
All other entities
should apply the guidance in Update 2014-09 to annual reporting periods beginning after December 15, 2018, and interim reporting
periods within annual reporting periods beginning after December 15, 2019. Earlier application is permitted only as of an annual
reporting period beginning after December 15, 2016, including interim reporting periods within that reporting period, or an annual
reporting period beginning after December 15, 2016, and interim reporting periods within annual reporting periods beginning one
year after the annual reporting period in which an entity first applies the guidance in Update 2014-09.
ii) In January 2015,
the FASB issued Accounting Standard Update, or ASU, 2015-01-Income Statement-Extraordinary and Unusual Items, which seeks to simplify
income statement presentation by eliminating the concept of Extraordinary Items. This Update eliminates from GAAP the concept of
extraordinary items. Subtopic 225-20, Income Statement—Extraordinary and Unusual Items, required that an entity separately
classify, present, and disclose extraordinary events and transactions. The amendments in this Update are effective for fiscal years,
and interim periods within those fiscal years, beginning after December 15, 2015. A reporting entity may apply the amendments prospectively.
A reporting entity also may apply the amendments retrospectively to all prior periods presented in the financial statements. Early
adoption is permitted provided that the guidance is applied from the beginning of the fiscal year of adoption.
F-
50
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
NOTE 9 - OPERATING LEASES
Bellsoft leases office
space in Lawrenceville, Georgia under a net operating lease agreement. Lease expense for leased property has been accounted for
under the operating lease method where ownership of the asset does not transfer to the lessee. The lease agreement has expired
and the Company is a tenant at will on a month to month basis.
Bellsoft India leases
office facilities in Chennai, India under a month to month net operating lease agreement.
Bellsoft Canada does
not maintain office space.
Operating lease expense
was $107,377 and $150,809 for the years ended December 31, 2014 and 2013.
NOTE 10 - CONCENTRATION OF CREDIT RISK
For the years ended
December 31, 2014 and 2013, approximately 80% and 88% of Bellsoft's revenue was derived from five customers. As of December
31, 2014 and 2013, approximately 70% and 78% of the Bellsoft's accounts receivable were due from four and three customers
respectively.
For the years ended
December 31, 2014 and 2013, 100% of Bellsoft Canada's revenue was derived from two customers. As of December 31, 2014 and
2013, 100% and 96% of the Bellsoft Canada's accounts receivable were due from two customers, respectively.
At times the Company
may have bank deposits in excess of the maximum amount of U.S. Federal or Canada deposit insured limits (FDIC and CDIC, respectively).
As of December 31, 2014 and 2013, Bellsoft had approximately $671,000 and $1,795,000, respectively in unsecured cash reserves on
deposit in excess of FDIC limit; Bellsoft Canada had approximately $127,000 and $130,000, respectively, in unsecured cash reserve
on deposit in excess of CDIC limit.
NOTE 11 - SUBSEQUENT EVENTS
The Company has evaluated
subsequent events through January 21, 2016, the date the consolidated financial statements were available to be issued.
On November 20, 2015,
the Company entered into a share purchase agreement with Ameri Holdings, Inc. ('"AMERI") based in Princeton,
New Jersey, for the consideration listed below. For financial accounting purposes, the Company recognizes September 1, 2015 as
the effective date of the disposition.
The purchase price
for the acquisition of the Company consisted of:
1. A cash payment in
the amount of $3,000,000 at closing,
2. 235,295 shares of
AMERI's common stock issued at closing,
3. $250,000 quarterly
cash payments to be paid on the last day of each calendar quarter of 2016,
4. a $1,000,000 cash
reimbursement to be paid 5 days following closing to compensate the sellers of the Company for a portion of the Company's
approximate cash balance as of September 1, 2015,
F-
51
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
December 31, 2014 and 2013
5. approximately $2,500,000
to be paid and the amount confirmed within 30 days of closing in connection with the excess of the Company's accounts receivable
over its accounts payable as of September 1, 2015, and
6. earn-out payments
of approximately $500,000 a year for 2016 and 2017, if earned through the achievement of annual revenue and EBITDA targets specified
in the purchase agreement, subject to downward or upward adjustment depending on actual results.
Simultaneously with
the acquisition of the Company, Bellsoft entered into a Revolving Credit and Security Agreement (the "Credit Facility")
with Federal National Payables, Inc., a Delaware corporation doing business as Federal National Commercial Credit (the "Lender").
Up to $6 million principal amount of advances may be extended under the Credit Facility. The Credit Facility will be used to pay
a portion of the costs associated with the acquisition of Bellsoft, with the balance being available for general working capital
of Bellsoft. The Credit Facility has a term of two years, which will automatically renew unless a written notice of termination
is given by Bellsoft or the Lender to the other at least 60 days prior to the end of the original or any renewed term. Interest
under the Credit Facility will accrue on the higher of (a) the outstanding principal amount of advances under the Credit Facility
and (b) $2,000,000 at a per annum rate equal to the Prime Rate plus 1.00%, which will be payable monthly in arrears. With each
payment of interest, Bellsoft will also pay a servicing fee of 0.38% multiplied by the higher of (a) the average daily principal
amount of advances under the Credit Facility for the previous calendar month or portion thereof and (b) $2,000,000. The Credit
Facility is secured by substantially all of Bellsoft's assets. The amounts borrowed by Bellsoft under the Credit Facility
are guaranteed by AMERI.
F-
52
BELLSOFT, INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Balance Sheets
September 30,
2015
2014
ASSETS:
Current assets:
Cash
$
1,443,375
$
1,142,197
Accounts receivable, net
5,640,847
3,853,725
Employee advances
8,314
2,500
Prepaid expenses
8,718
7,386
Total current assets
7,101,254
5,005,808
Property and equipment, net
121,585
118,155
Other assets:
Security deposits
30,440
88,082
Loan receivable
48,026
53,406
Total other assets
78,466
141,488
Total Assets
$
7,301,305
$
5,265,451
LIABILITIES AND STOCKHOLDER'S EQUITY:
Liabilities:
Current liabilities:
Accounts payable
$
1,344,434
$
856,989
Accrued expenses
1,574,255
1,223,890
Customer advances
19,663
211,971
Line of credit
250,000
250,000
Total current liabilities
3,188,352
2,542,850
Note payable - related party
56,890
8,351
Stockholder's equity:
Common stock, no par, authorized 10,000 shares, issued and outstanding 750 shares
102,875
102,875
Accumulated other comprehensive loss
(109,162
)
(34,755
)
Non-controlling interest
68,503
69,145
Retained earnings
3,993,847
2,576,985
Total stockholder's equity
4,056,063
2,714,250
Total Liabilities and Stockholder's Equity
$
7,301,305
$
5,265,451
See notes to the unaudited condensed consolidated
financial statements.
F-
53
BELLSOFT, INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Comprehensive
Income
Three months ended
September 30,
Nine months ended
September 30,
2015
2014
2015
2014
REVENUE
$
7,486,339
$
5,698,603
$
20,196,231
$
15,074,567
OPERATING EXPENSES:
6,771,600
5,373,424
18,505,634
14,002,719
INCOME FROM OPERATIONS
714,739
325,179
1,690,597
1,071,848
OTHER INCOME (EXPENSES)
Other income
808
2,449
808
2,449
Interest expense
(4,776
)
(4,526
)
(14,312
)
(26,500
)
Foreign currency gain (loss)
862
—
(93,341
)
(176,606
)
Total other expense
(3,107
)
(2,077
)
(106,845
)
(200,657
)
NET INCOME
711,632
323,102
1,583,752
871,191
Net income, non-controlling interest
8,384
15,643
18,279
12,185
Net income, controlling interest
720,016
338,745
1,602,031
883,376
Other comprehensive income (loss):
Foreign currency translation   adjustment
8,952
78,068
18,703
34,149
Comprehensive income
$
728,968
$
416,813
$
1,620,734
$
917,525
See notes to the unaudited condensed consolidated
financial statements.
F-
54
BELLSOFT, INC. AND SUBSIDIARIES
Unaudited Condensed Consolidated Statements of Cash Flows
Three months ended
September 30,
Nine months ended
September 30,
2015
2014
2015
2014
CASH FLOWS FROM OPERATING ACTIVITIES
Net income
$
720,016
$
338,745
$
1,602,031
$
883,376
Adjustments to reconcile net income to net cash  provided by operating activities:
Depreciation
2,489
4,163
7,467
12,490
Changes in assets and liabilities:
Accounts receivable
(791,954
)
(654,554
)
(1,408,244
)
(979,732
)
Employee advances
1,050
(1,800
)
(1,200
)
3,000
Prepaid expenses
11,400
—
(4,114
)
52,311
Other receivable
—
—
(2,925
)
(47,582
)
Security deposits
—
—
55,476
214
Accounts payable
302,481
11,113
193,572
125,164
Accrued expenses
28,228
336,501
97,156
95,926
Customer advances
—
—
(70,107
)
—
Income tax payable
—
—
(21,143
)
(29,953
)
Net cash provided by operating activities
273,710
34,168
447,969
115,214
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures
(2,543
)
(4,872
)
(17,196
)
(32,595
)
Net cash used in investing activities
(2,543
)
(4,872
)
(17,196
)
(32,595
)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of line of credit
(1,000,000
)
(850,000
)
(250,000
)
(1,500,000
)
Note payable - related party
—
(36,762
)
56,890
8,351
Repayment of note receivable from shareholder
—
—
—
220,000
Shareholders' distributions
—
—
(4,505
)
(657
)
Non-controlling interest net income
(8,334
)
(15,643
)
(18,279
)
(12,185
)
Net cash used in financing activities
(1,008,334
)
(902,405
)
(215,894
)
(1,284,491
)
Effect of exchange rate changes on cash
8,952
78,068
18,703
34,150
Net increase/(decrease) in cash
(728,215
)
(795,041
)
233,582
(1,167,722
)
Cash at beginning of period
2,171,590
1,937,238
1,209,793
2,309,919
Cash at end of period
$
1,443,375
$
1,142,197
$
1,443,375
$
1,142,197
Supplemental disclosure:
Cash paid for interest
$
4,776
$
4,526
$
14,312
$
26,500
Cash paid for foreign income taxes
$
—
$
—
$
9,768
$
30,844
See notes to the unaudited condensed consolidated
financial statements.
F-
55
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
September 30, 2015 and 2014
NOTE 1 - NATURE OF OPERATIONS
Bellsoft, Inc. ("Bellsoft"),
was incorporated in the State of Georgia on March 19, 1996. The Company provides implementation and custom development services
for Enterprise Resource Planning (ERP) software.
On February 7, 2005, Bellsoft acquired
a 72% ownership interest in Bellsoft India Solutions Private (Pvt) Limited (Ltd), a company incorporated under the laws of India
("Bellsoft India"). The primary purpose of Bellsoft India is to provide back office and marketing functions to Bellsoft,
Inc. Bellsoft India's fiscal year ends on March 31st. For consolidation purposes Bellsoft India prepares statements for the
reporting period which corresponds with the fiscal year of the parent.
On August 31, 2011, Bellsoft formed BSI
Global IT Solutions, Inc. (Bellsoft Canada), a company incorporated under the laws of Canada. The primary purpose of Bellsoft Canada
is to provide implementation and custom development services for ERP software for clients in Canada. Bellsoft owns 100% of Bellsoft
Canada.
Bellsoft India and Bellsoft Canada are
collectively referred to as the Subsidiaries. Bellsoft, Inc. and the Subsidiaries are collectively referred to as the Company.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
BASIS OF CONSOLIDATION
The consolidated financial statements include
the accounts of the Subsidiaries. All material intercompany transactions and balances have been eliminated in consolidation.
BASIS OF PRESENTATION
The Company has adopted the Financial Accounting
Standards Board ("FASB") Codification ("Codification" or "ASC"). The Codification is the single
official source of authoritative accounting principles generally accepted in the United States of America ("U.S. GAAP")
recognized by the FASB to be applied by nongovernmental entities. All of the Codification's content carries the same level
of authority.
F-
56
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
September 30, 2015 and 2014
FOREIGN OPERATIONS AND FOREIGN CURRENCY
The Subsidiaries' foreign operations
are subject to risks inherent in operating under different legal systems and various political and economic environments. Among
the risks are changes in existing tax laws, possible limitations on foreign investment and income repatriation, government price
or foreign exchange controls, and restrictions on currency exchange. Net assets of foreign operations were approximately 7% and
12% of the Company's total net assets at September 30, 2015 and 2014, respectively. Cash held in foreign based bank
accounts totaled approximately $248,701 and $342,273 at September 30, 2015 and 2014.
The Subsidiaries transact business in their
local currencies. The financial statements reflect the translation of the functional currency statements to U.S. Dollars. Financial
statements use end-of-period exchange rates for assets and liabilities, weighted average exchange rates for revenues and expenses,
and historical rates for equity. The resulting foreign currency translation adjustment is recorded in accumulated other comprehensive
income (loss) as a component of equity.
USE OF ESTIMATES
The preparation of consolidated financial
statements in conformity with U.S. GAAP 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. Actual results could differ from those estimates.
REVENUE RECOGNITION
The Company recognizes revenue in accordance
with FASB ASC 985-605-25-79. Revenue is derived from time and expense contracts and is recognized as the services are performed.
Revenue received as reimbursement of billable expenses is reported on a gross basis within revenue and the related expenses are
recorded in operating expenses. Unbilled revenue is comprised of revenue recognized in relation to efforts incurred on time and
expense contracts not billed at a period end where services are performed in accordance with agreed terms. Customer advances represent
payments received in advance of an engagement and are deferred until the service is performed.
CASH AND CASH EQUIVALENTS
The Company considers all highly liquid
investments with an original maturity of three months or less to be cash equivalents.
F-
57
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
September 30, 2015 and 2014
ACCOUNTS RECEIVABLE
The Company routinely assesses the financial
strength of its customers and debtors and believes that its accounts receivable credit risk exposure is limited. Accounts receivable
are carried at the original invoice amount less an estimate made for doubtful receivables based on a review of all outstanding
amounts on a monthly basis. An allowance is provided for known and anticipated credit losses, as determined by management in the
course of regularly evaluating individual customer receivables. This evaluation takes into consideration a customer's financial
condition and credit history, as well as current economic conditions. Accounts receivable are considered delinquent when they are
over 90 days past due and are written off when deemed uncollectible. Recoveries of accounts receivable previously written off are
recorded in income when received.
PROPERTY AND EQUIPMENT
Property and equipment are recorded at
cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the assets,
which range from 3 to 7 years.
Expenditures for maintenance and repairs
are charged to income as incurred. Additions and betterments are capitalized. The cost of properties sold or otherwise
disposed of, and the accumulated depreciation thereon, is eliminated from the property and reserve accounts, and gains and losses
are reflected in the consolidated statements of operations.
INCOME TAXES
Bellsoft has elected to be taxed as an
S corporation for income tax purposes effective January 1, 2002. Accordingly, the shareholders are responsible for income
taxes; therefore, no provision for income taxes is included in these financial statements for Bellsoft, Inc.
Bellsoft's policy is to distribute
dividends to provide funds for shareholders to pay income taxes on income reported by the Company. Periodically, additional distributions
are paid to reduce equity in excess of management's evaluation of the amount required for working capital. Management believes
the payment of additional distributions will not negatively impact profitability or impair the operating needs of the Company.
Equity distributions during the periods ended September 30, 2015 and 2014 were $4,505 and $657, respectively.
The Company accounts for the effect of
any uncertain tax positions based on a more likely than not threshold to the recognition of the tax positions being sustained based
on the technical merits of the position under scrutiny by the applicable taxing authority. If a tax position or positions
are deemed to result in uncertainties of those positions, the unrecognized tax benefit is estimated based on a cumulative probability
assessment that aggregates the estimated tax liability for all uncertain tax positions.
F-
58
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
September 30, 2015 and 2014
The Company has evaluated its tax positions
and determined no uncertainty requires recognition. The Company files income tax returns in the U.S. federal jurisdiction,
and various state jurisdictions, as well as the required foreign countries. The Company is generally no longer subject to U.S.
federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2011.
ADVERTISING COSTS
Advertising costs are charged to operations
when incurred. Advertising expense was $11,624 and $17,624 for the three months ended September 30, 2015 and 2014, respectively
and $26,780 and $40,231 for the nine months ended September 30, 2015 and 2014, respectively.
NOTE 3 - ACCOUNTS RECEIVABLE
Accounts receivable as of September 30, 2015 and 2014 are summarized
as follows:
Amounts due for services rendered and billed:
2015
2014
Outstanding less than 90 days
$
4,449,642
$
3,021,016
Outstanding more than 90 days
(34,488
)
(31,329
)
4,415,154
2,989,687
Less: allowance for doubtful accounts
—
—
Amounts due for services rendered and billed, net
4,415,154
2,989,687
Amounts due for services rendered not billed:
1,225,693
864,038
Accounts receivable, net
$
5,640,847
$
3,853,725
F-
59
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
September 30, 2015 and 2014
NOTE 4 - PROPERTY AND EQUIPMENT
Property and equipment consists of the following at September
30,
2015
2014
Computer equipment
$
169,329
$
180,263
Furniture and fixtures
59,346
58,455
Office premises - India
60,658
58,670
Software
73,943
92,932
Office equipment
46,227
55,206
Leasehold improvements
4,194
4,194
Fixed assets, gross
413,697
449,719
Less: accumulated depreciation
(292,112
)
(331,564
)
Fixed assets, net
$
121,585
$
118,155
Depreciation expense was $2,489 and $4,163
for the three months ended September 30, 2015 and 2014, respectively and $7,467 and $12,490 for the nine months ended September
30, 2015 and 2014, respectively.
NOTE 5 - LINE OF CREDIT
Bellsoft had a revolving line of credit
based on an agreement dated May 13, 2011 with a current maturity date of October 30, 2015. The line of credit had a maximum
borrowing base of $2,000,000 with the interest rate at BBA Libor Daily Floating plus 2.75%. The line was secured by (1) a
shareholder's personal guaranty and (2) a lien on all business assets of the Borrower including, but not limited to, accounts
receivable, fixed assets and general intangible assets. The line of credit required Bellsoft, Inc. to meet certain financial
and non-financial covenants, which is typical to such agreements.
The outstanding balance of the line of
credit for the three months ended September 30, 2015 and 2014, respectively was $250,000 and $250,000 and for the nine months ended
September 30, 2015 and 2014 respectively was $250,000 and $250,000. Interest was accrued approximately at 2.94% and 2.919% at September
30, 2015 and 2014. Total interest expense for the three months period ended September 30, 2015 and 2014 was $4,776 and $4,526 and
for the nine months ended September 30, 2015 and 2014 was $14,312 and $26.500.
F-
60
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
September 30, 2015 and 2014
The outstanding balance of the line of
credit was fully paid off and cancelled subsequent to the share purchase agreement entered into by the Company and Ameri Holdings,
Inc. (See Note 10)
NOTE 6 - EMPLOYEE BENEFIT PLAN
Bellsoft maintains a defined contribution
401K plan covering all eligible employees of Bellsoft, Inc. Employees 21 years of age are eligible to participate in the plan
after six months of service. Employees are allowed to contribute up to the maximum amount under the Internal Revenue Code. The
plan allows Bellsoft to make a discretionary match of employee contributions. During the three months period ended September
30, 2015 and 2014 and the nine months ended September 30, 2015 and 2014, respectively there were no contributions to the Plan.
NOTE 7 - RECENT ACCOUNTING PRONOUNCEMENTS
i) On May 28, 2014, the FASB issued Accounting
Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606), with an effective date for annual reporting periods
beginning after December 15, 2016, including interim periods within that reporting period, for public business entities, certain
not-for-profit entities, and certain employee benefit plans. The effective date for all other entities was for annual reporting
periods beginning after December 15, 2017, and interim periods within annual periods beginning after December 15, 2018.
The amendments in this Update defer the
effective date of Update 2014-09. Public business entities, certain not-for-profit entities, and certain employee benefit plans
should apply the guidance in Update 2014-09 to annual reporting periods beginning after December 15, 2017, including interim reporting
periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December
15, 2016, including interim reporting periods within that reporting period.
All other entities should apply the guidance
in Update 2014-09 to annual reporting periods beginning after December 15, 2018, and interim reporting periods within annual reporting
periods beginning after December 15, 2019. Earlier application is permitted only as of an annual reporting period beginning after
December 15, 2016, including interim reporting periods within that reporting period, or an annual reporting period beginning after
December 15, 2016, and interim reporting periods within annual reporting periods beginning one year after the annual reporting
period in which an entity first applies the guidance in Update 2014-09.
F-
61
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
September 30, 2015 and 2014
ii) In January 2015, the FASB, issued Accounting
Standard Update, or ASU, 2015-01-Income Statement-Extraordinary and Unusual Items, which seeks to simplify income statement presentation
by eliminating the concept of Extraordinary Items. This Update eliminates from GAAP the concept of extraordinary items. Subtopic
225-20, Income Statement—Extraordinary and Unusual Items, required that an entity separately classify, present, and disclose
extraordinary events and transactions. The amendments in this Update are effective for fiscal years, and interim periods within
those fiscal years, beginning after December 15, 2015. A reporting entity may apply the amendments prospectively. A reporting entity
also may apply the amendments retrospectively to all prior periods presented in the financial statements. Early adoption is permitted
provided that the guidance is applied from the beginning of the fiscal year of adoption.
NOTE 8 - OPERATING LEASES
Bellsoft leases office space in Lawrenceville,
Georgia under a net operating lease agreement. Lease expense for leased property has been accounted for under the operating
lease method where ownership of the asset does not transfer to the lessee. The lease agreement has expired and the Company is a
tenant at will on a month to month basis.
Bellsoft India leases office facilities
in Chennai, India under a month to month net operating lease agreement.
Bellsoft Canada does not maintain office
space.
Operating lease expense was for the three
months ended September 30, 2015 and 2014 was $33,182 and $80,852, respectively. For the nine months ended September 30, 2015 and
2014, operating lease expense was $54,443 and $118,198.
NOTE 9 - CONCENTRATION OF CREDIT RISK
For the three months ended September 30,
2015 and 2014, approximately 66% and 78% of Bellsoft's revenue was derived from four and five customers, respectively. For
the nine months ended September 30, 2015 and 2014, approximately 58% and 83% of Bellsoft's revenue was derived from 3 and
5 customers. As of the nine months period ending September 30, 2015 and 2014, approximately 10% and 16% of the Bellsoft's
accounts receivable were due from 3 and 5 customers.
For the three and nine month periods ended
September 30, 2015 and 2014, 100% of Bellsoft Canada's revenue was derived from two customers. As of September 30, 2015 and
2014, 100% of the Bellsoft Canada's accounts receivable were due from two customers.
F-
62
BELLSOFT, INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements
September 30, 2015 and 2014
At times the Company may have bank deposits
in excess of the maximum amount of U.S. Federal or Canada deposit insured limits (FDIC and CDIC, respectively). As of September
30, 2015 and 2014, Bellsoft had approximately $1,193,375 and $892,197 in unsecured cash reserves on deposit in excess of FDIC limit;
Bellsoft Canada had approximately $131,000 and $127,000, respectively, in unsecured cash reserve on deposit in excess of the CDIC
limit.
NOTE 10 - SUBSEQUENT EVENTS
The Company has evaluated subsequent events
through January 25, 2016, the date the consolidated financial statements were available to be issued.
On November 20, 2015, the Company entered
into a share purchase agreement with Ameri Holdings Inc. ('AMERI') based in Princeton, New Jersey, for the consideration
listed below. For financial accounting purposes, the Company recognizes September 1, 2015 as the effective date of the disposition.
The purchase price of the acquisition of
the Company consisted of:
1. A cash payment in the amount of $3,000,000
at closing,
2. 235,295 shares of AMERI's common
stock issued at closing,
3. $250,000 quarterly cash payments to
be paid on the last day of each calendar quarter of 2016,
4. a $1,000,000 cash reimbursement to be
paid 5 days following closing to compensate the sellers of the Company for a portion of the Company's approximate cash balance
as of September 1, 2015,
5. approximately $2,500,000 to be paid
and the amount confirmed within 30 days of closing in connection with the excess of the Company's accounts receivable over
its accounts payable as of September 1, 2015, and
6. earn-out payments of approximately $500,000
a year for 2016 and 2017, if earned through the achievement of annual revenue and EBITDA targets specified in the Bellsoft purchase
agreement, subject to downward or upward adjustment depending on actual results.
Simultaneously with the acquisition of
the Company, Bellsoft entered into a Revolving Credit and Security Agreement (the "Credit Facility") with Federal National
Payables, Inc., a Delaware corporation doing business as Federal National Commercial Credit (the "Lender"). Up to $6
million principal amount of advances may be extended under the Credit Facility. The Credit Facility will be used to pay a portion
of the costs associated with the acquisition of Bellsoft, with the balance being available for general working capital of Bellsoft.
The Credit Facility has a term of two years, which will automatically renew unless a written notice of termination is given by
Bellsoft or the Lender to the other at least 60 days prior to the end of the original or any renewed term. Interest under the Credit
Facility will accrue on the higher of (a) the outstanding principal amount of advances under the Credit Facility and (b) $2,000,000
at a per annum rate equal to the Prime Rate plus 1.00%, which will be payable monthly in arrears. With each payment of interest,
Bellsoft will also pay a servicing fee of 0.38% multiplied by the higher of (a) the average daily principal amount of advances
under the Credit Facility for the previous calendar month or portion thereof and (b) $2,000,000. The Credit Facility is secured
by substantially all of Bellsoft's assets. The amounts borrowed by Bellsoft under the Credit Facility are guaranteed by AMERI.
F-
63
CERTIFIED PUBLIC ACCOUNTANTS REPORT
OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
The Board of Members,
We have audited the
accompanying balance sheets of DC&M Partners, L.L.C. (the "Company") as of December 31, 2015 and 2014 and the related
statements of income, retained earnings and cash flows for the years 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 audits.
We conducted our audits
in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the 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 audits 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 the Company as of December
31, 2015 and 2014 and the results of its operations and its cash flows for the years then ended, in conformity with accounting
principles generally accepted in the United States of America.
/s/ Ram Associates
Ram Associates
Hamilton, NJ
October 11, 2016.
3240 EAST STATE STREET EXT. + HAMILTON,
NJ08619 + (609) 631-9552/63 1-9553 + FAX (888) 319-8898
PKRAM@RAMASSOCIATES.US
F-
64
DC&M PARTNERS L.L.C.
Balance Sheets
December 31,
2015
2014
ASSETS
CURRENT ASSETS
Cash
$
1,171,274
$
1,402,294
Accounts receivable, net
3,940,153
2,610,165
Prepaid expenses
47,181
45,709
TOTAL CURRENT ASSETS
5,158,608
4,058,168
PROPERTY AND EQUIPMENT, NET
1,780
—
OTHER ASSETS
Security deposits
1,263
1,263
Other assets
5,406
42,063
TOTAL OTHER ASSETS
6,669
43,326
TOTAL ASSETS
$
5,167,057
$
4,101,494
LIABILITIES AND MEMBERS' EQUITY
CURRENT LIABILITIES
Accounts payable
$
2,541,090
$
1,531,271
Accrued expenses
2,398
3,833
Income tax payable
79,667
54,370
TOTAL CURRENT LIABILITIES
2,623,155
1,589,474
LONG-TERM LIABILITIES
Deferred Compensation
449,469
449,469
TOTAL CURRENT AND LONG-TERM LIABILITIES
3,072,624
2,038,943
MEMBERS' EQUITY
2,094,433
2,062,551
TOTAL MEMBERS' EQUITY
2,094,433
2,062,551
TOTAL LIABILITIES AND MEMBERS' EQUITY
$
5,167,057
$
4,101,494
See accompanying notes to financial statements
F-
65
DC&M PARTNERS, L.L.C.
Statements of Income and Comprehensive Income
Year Ended December 31,
2015
2014
REVENUES
$
17,865,584
$
16,341,331
COST OF SALES
14,518,816
13,477,468
Gross profit
3,346,768
2,863,863
OPERATING EXPENSES
2,182,795
1,825,362
Income from operations
1,163,973
1,038,501
OTHER INCOME (EXPENSES)
Interest income
263
293
Other income
9,000
9,000
Interest expense
(117
)
(25
)
TOTAL OTHER EXPENSE
9,146
9,268
Income before income tax expense
1,173,119
1,047,769
Income tax expense
87,180
34,660
1,085,939
1,013,109
Other comprehensive income (loss):
Foreign currency translation adjustment
—
(7,251
)
Net income
$
1,085,939
$
1,005.858
See accompanying notes to financial statements
F-
66
DC&M PARTNERS, L.L.C.
Statement of Members' Equity
MACT
Lucid
Holdings,
LLC
Housenkens LLC
Solutions,
Inc.
Total
Balance at December 31, 2013
$
631,252
$
632,192
$
632,433
$
1,895,877
Net Income
352,050
352,050
301,758
1,005,858
Member Distributions
(279,728
)
(279,728
)
(279,728
)
(839,184
)
Balance at December 31, 2014
703,574
704,514
654,463
2,062,551
Net Income
380,079
380,079
325,781
1,085,939
Member Distributions
(351,352
)
(351,352
)
(351,353
)
(1,054,057
)
Balance at December 31, 2015
$
732,301
$
733,241
$
628,891
$
2,094,433
See accompanying notes to financial statements
F-
67
DC&M PARTNERS, L.L.C.
Statements of Cash Flows
Year Ended December 31,
2015
2014
CASH FLOWS FROM OPERATING ACTIVITIES
Net income
$
1,085,939
$
1,005,858
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation
511
1,727
Changes in assets and liabilities:
Accounts receivable
(1,329,988
)
(95,838
)
Prepaid expenses
(1,472
)
(7,834
)
Note receivable
39,157
—
Other assets
(2,500
)
—
Accounts payable
1,009,819
218,989
Accrued expenses
(1,434
)
2,131
Income tax payable
25,296
12,569
Long term deferred compensation
—
(5,000
)
Net cash provided by operating activities
825,328
1,130,934
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures
(2,291
)
(1,668
)
Net cash provided by/(used in) investing activities
(2,291
)
(1.668
)
CASH FLOWS FROM FINANCING ACTIVITIES
Partner distributions
(1,054,057
)
(839,184
)
Net cash used in financing activities
(1,054,057
)
(839,184
)
Net decrease in cash and cash equivalents
(231,020
)
291,750
Cash at beginning of year
1,402,294
1,110,544
Cash at end of year
$
1,171,274
$
1,402,294
See accompanying notes to financial statements
F-
68
DC&M PARTNERS, L.L.C.
Notes to Financial Statements
December 31, 2015 and 2014
NOTE 1 - NATURE OF OPERATIONS
DC&M Partners,
L.L.C. (the "Company"), was formed in the State of Arizona on January 29, 2007. The Company provides clients with a
wide range of SAP development, consultancy and management services.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
The Company has adopted
the Financial Accounting Standards Board ("FASB") Codification ("Codification" or "ASC"). The
Codification is the single official source of authoritative accounting principles generally accepted in the United States of America
("U.S. GAAP") recognized by the FASB to be applied by nongovernmental entities. All of the Codification's content
carries the same level of authority.
USE OF ESTIMATES
The preparation of
financial statements in conformity with U.S. GAAP 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. Actual results could differ from those estimates.
REVENUE RECOGNITION
The Company recognizes
revenue in accordance with FASB ASC 985-605-25-79. Revenue is derived from time and expense contracts and is recognized as the
services are performed. Revenue received as reimbursements of billable expenses are reported gross within revenue and the related
expenses are recorded in operating expenses. Unbilled revenue comprises of revenue recognized in relation to efforts incurred on
time and expense contracts not billed at period end where services are performed in accordance with agreed terms. Customer advances
represent payments received in advance of an engagement and are deferred until the service is performed.
CASH AND CASH EQUIVALENTS
The Company considers
all highly liquid investments with an original maturity of three months or less to be cash equivalents.
ACCOUNTS RECEIVABLE
The Company routinely
assesses the financial strength of its customers and debtors and believes that its accounts receivable credit risk exposure is
limited. Accounts receivable are carried at the original invoice amount less an estimate made for doubtful receivables based on
a review of all outstanding amounts on a monthly basis. An allowance is provided for known and anticipated credit losses, as determined
by management in the course of regularly evaluating individual customer receivables. This evaluation takes into consideration a
customer's financial condition and credit history, as well as current economic conditions. Accounts receivable are considered
delinquent when they are over 90 days past due and are written off when deemed uncollectible. Recoveries of accounts receivable
previously written off are recorded in income when received.
PROPERTY AND EQUIPMENT
Property and equipment
are recorded at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives
of the assets, which range from 3 to 7 years.
F-
69
DC&M PARTNERS,
L.L.C.
Notes to Financial Statements
December 31, 2015 and 2014
Expenditures for maintenance
and repairs are charged to income as incurred. Additions and betterments are capitalized. The cost of properties sold or otherwise
disposed of, and the accumulated depreciation thereon, is eliminated from the property and reserve accounts, and gains and losses
are reflected in the consolidated statements of operations.
INCOME TAXES
The Company elected
to be taxed as a partnership for income tax purposes effective June 3, 2001. Accordingly, the members are responsible for income
taxes and no provision for income taxes is included in these financial statements for the Company.
The Company's
policy is to distribute dividends to provide funds for members to pay income taxes on income reported by the Company. Periodically,
additional distributions are paid to reduce equity in excess of management's evaluation of the amount required for working
capital. Management believes the payment of additional distributions will not negatively impact profitability or impair the operating
needs of the Company. Equity distributions during the years ended December 31, 2015 and 2014 were $1,054,057 and $839,184, respectively.
The Company accounts
for the effect of any uncertain tax positions based on a more likely than not threshold to the recognition of the tax positions
being sustained based on the technical merits of the position under scrutiny by the applicable taxing authority. If a tax position
or positions are deemed to result in uncertainties of those positions, the unrecognized tax benefit is estimated based on a cumulative
probability assessment that aggregates the estimated tax liability for all uncertain tax positions. Interest and penalties assessed,
if any, are accrued as income tax expense.
The Company has evaluated
its tax positions and determined no uncertainty requires recognition. The Company files income tax returns in the U.S. federal
jurisdiction, and various state jurisdictions, as well as the required foreign countries. The Company is generally no longer subject
to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2011.
NOTE 3 - ACCOUNTS RECEIVABLE
Amounts due for services rendered and billed:
2015
2014
Outstanding less than 90 days
$
3,843,137
$
2,763,589
Outstanding more than 90 days
97,016
(153,424
)
3,940,153
2,610,165
Less: allowance for doubtful accounts
—
—
Amounts due for services rendered and billed, net
3,940,153
2,610,165
Amounts due for services rendered not billed:
Accounts receivable, net
$
3,940,153
$
2,610,165
NOTE 4 - PROPERTY AND EQUIPMENT
2015
2014
Office equipment
$
54,829
$
52,538
Fixed assets, gross
54,829
52,538
Less: accumulated depreciation
(53,049
)
(52,538
)
Fixed assets, net
$
1,780
$
—
Depreciation expense
for the years ended December 31, 2014 and 2015 were $511 and $1,780, respectively.
F-
70
DC&M PARTNERS, L.L.C.
Notes to Financial Statements
December 31, 2015 and 2014
NOTE 5 - INCOME TAXES
The Company accounts
for income taxes under the provisions of the FASB ASC 740, Income Taxes. Although the Company's management believes that
their tax estimates are reasonable, there is no assurance that the final determination of tax liability will not be different from
what is reflected in the Company's income tax provisions and accruals.
Income tax expense
for the years ended December 31, 2015 and 2014 were $87,180 and $34,660, respectively.
NOTE 6 - DEFERRED COMPENSATION
The Company reviews
compensation for members on an annual basis and accrues deferred compensation for any excess of amounts owed versus amounts paid
to members. As of December 31, 2015 and 2014, deferred compensation was $449,469 and $449,469, respectively. All dues were paid
off as of the report date.
NOTE 7 - RECENT ACCOUNTING PRONOUNCEMENTS
In August 2014, the
FASB issued amended guidance related to disclosure of uncertainties about an entity's ability to continue as a going concern.
The new guidance requires management to evaluate whether there is substantial doubt about the entity's ability to continue
as a going concern and, as necessary, to provide related footnote disclosures. The guidance has an effective date of December 31,
2016. The Company believes that the adoption of this new standard will not have a material impact on its financial statements.
In May 2014, the FASB
issued Accounting Standard Update, or ASU, 2014-09-Revenue from Contracts with Customers, which provides a single, comprehensive
revenue recognition model for all contracts with customers. The core principal of this ASU is that an entity should recognize revenue
when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects
to be entitled in exchange for those goods or services. This ASU also requires additional disclosure about the nature, amount,
timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in
judgments and assets recognized from costs incurred to obtain or fulfill a contract. This ASU is effective for annual periods,
and interim periods within those annual periods, beginning after December 15, 2016. Early adoption is not permitted. The Company
is currently evaluating the impact this ASU will have on its financial statements.
In January 2015, the
FASB issued ASU 2015-01-Income Statement-Extraordinary and Unusual Items, which seeks to simplify income statement presentation
by eliminating the concept of Extraordinary Items. This ASU eliminates from U.S. GAAP the concept of extraordinary items. Subtopic
225-20, Income Statement—Extraordinary and Unusual Items, required that an entity separately classify, present, and disclose
extraordinary events and transactions. The amendments in this ASU are effective for fiscal years, and interim periods within those
fiscal years, beginning after December 15, 2015. A reporting entity may apply the amendments prospectively. A reporting entity
also may apply the amendments retrospectively to all prior periods presented in the financial statements. Early adoption is permitted
provided that the guidance is applied from the beginning of the fiscal year of adoption.
In November 20, 2015,
the FASB issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes. The ASU is part of the FASB's simplification
initiative aimed at reducing complexity in accounting standards. Current U.S. GAAP requires the deferred taxes for each jurisdiction
(or tax-paying component of a jurisdiction) to be presented as a net current asset or liability and net noncurrent asset or liability.
This requires a jurisdiction-by-jurisdiction analysis based on the classification of the assets and liabilities to which the underlying
temporary differences relate, or, in the case of loss or credit carryforwards, based on the period in which the attribute is expected
to be realized. Any valuation allowance is then required to be allocated on a pro rata basis, by jurisdiction, between current
and noncurrent deferred tax assets. To simplify presentation, the new guidance requires that all deferred tax assets and liabilities,
along with any related valuation allowance, be classified as noncurrent on the balance sheet. As a result, each jurisdiction will
now only have one net noncurrent deferred tax asset or liability. Importantly, the guidance does not change the existing requirement
that only permits offsetting within a jurisdiction – that is, companies are still prohibited from offsetting deferred tax
liabilities from one jurisdiction against deferred tax assets of another jurisdiction.
F-
71
DC&M PARTNERS, L.L.C.
Notes to Financial Statements
December 31, 2015 and 2014
NOTE 8 - OPERATING LEASES
The Company leases
office space in Chandler, Arizona under net operating lease agreement. Lease expense for leased property has been accounted for
under the operating lease method where ownership of the asset does not transfer to the lessee.
Operating lease expense
was $46,709 and $29,991 for the years ended December 31, 2015 and 2014, respectively.
NOTE 9 - CONCENTRATION OF CREDIT RISK
For the years ended
December 31, 2015 and 2014, approximately 62% and 64%, respectively, of the Company's revenue was derived from five customers.
As of December 31, 2015 and 2014, approximately 79% and 72%, respectively, of the Company's accounts receivable were due
from five and four customers.
At times the Company
may have bank deposits in excess of the maximum amount of U.S. federal deposit insured limits (FDIC). As of December 31, 2015 and
2014, the Company had approximately $1,081,000 and $1,312,000, respectively, in unsecured cash reserves on deposit in excess of
the FDIC limit.
NOTE 10 - SUBSEQUENT EVENTS
The Company has evaluated
subsequent events through October 11, 2016, the date the financial statements were available to be issued.
On July 29, 2015, the
Company entered into a membership interest purchase agreement with Ameri Holdings Inc. ("AMERI"), which is based in
Princeton, New Jersey, for the purchase of all of the outstanding membership interests of the Company for consideration of: (a)
a cash payment in the amount of $3,000,000 at closing, (b) 1,600,000 shares of AMERI common stock, which are to be issued on July
29, 2018 or upon a change of control of AMERI (whichever occurs earlier), and (c) earn-out payments to be paid, if earned, in 2017
and 2018, all as more particularly outlined in the purchase agreement.
F-
72
DC&M PARTNERS, L.L.C.
Unaudited Condensed Balance
Sheets
June 30,
2016
2015
ASSETS
CURRENT ASSETS
Cash
$
2,570,828
$
1,168,970
Accounts receivable, net
3,206,166
3,745,437
Prepaid expenses
21,000
27,663
TOTAL CURRENT ASSETS
5,797,994
4,942,070
PROPERTY AND EQUIPMENT, NET
4,141
1,865
OTHER ASSETS
Security deposits
1,263
1,263
Note receivable from member
—
34,925
Other assets
—
11,138
TOTAL OTHER ASSETS
1,263
47,326
TOTAL ASSETS
$
5,803,398
$
4,991,261
LIABILITIES AND MEMBERS' EQUITY
CURRENT LIABILITIES
Accounts payable
$
2,750,030
$
2,238,145
Accrued expenses
—
2,399
Income tax payable
—
67,418
TOTAL CURRENT LIABILITIES
2,750,030
2,307,962
LONG TERM LIABILITIES
Deferred Compensation
597,481
449,469
TOTAL CURRENT AND LONG-TERM LIABILITIES
3,347,511
2,757,431
MEMBERS' EQUITY
Members' Equity
2,455,887
2,233,830
TOTAL MEMBERS' EQUITY
2,455,887
2,233,830
TOTAL LIABILITIES AND MEMBERS' EQUITY
$
5,803,398
$
4,991,261
See accompanying notes to unaudited condensed financial
statements
F-
73
DC&M PARTNERS, L.L.C.
Unaudited Condensed Statements of Income
and Comprehensive Income
Three Months and Six Months Ended June 30, 2015 and
2016
Three Months Ended June 30,
Six Months Ended June 30,
2016
2015
2016
2015
REVENUES
$
5,474,575
$
4,567,772
$
10,601,951
$
8,328,380
COST OF SALES
4,258,090
3,703,613
8,475,405
6,802,052
Gross profit
1,216,485
864,159
2,126,546
1,526,328
OPERATING EXPENSES
683,560
529,454
1,077,688
916,907
Income from operations
532,925
334,705
1,048,858
609,421
OTHER INCOME (EXPENSES)
Interest income
66
66
131
130
Other income
0
0
0
9,000
Interest expense
0
-163
-441
0
TOTAL OTHER EXPENSE
66
-97
-310
9,130
Income before income tax expense
532,991
334,608
1,048,548
618,551
Income tax expense
43,325
40,188
65,775
48,987
Other comprehensive income (loss):
Foreign currency translation adjustment
—
—
—
—
Comprehensive income
$
489,666
$
294,420
$
982,773
$
569,564
See accompanying notes to unaudited condensed financial
statements
F-
74
DC&M PARTNERS, L.L.C.
Unaudited Condensed Statements of Cash Flows
For the Six months Ended June 2015 & 2016
Six Months ended June 30,
2016
2015
CASH FLOWS FROM OPERATING ACTIVITIES
Net income
$
982,773
$
569,564
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation
255
255
Changes in assets and liabilities:
Accounts receivable
733,987
(1,135,272
)
Prepaid expenses
26,181
18046
Note receivable
—
4,232
Other assets
5,406
(8,232
)
Accounts payable
208,939
706,872
Accrued expenses
(2,398
)
(1,434
)
Income tax payable
(79,666
)
13,048
Long term deferred compensation
148,011
—
Net cash provided by operating activities
2,023,490
167,079
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures
(2,616
)
(2,120
)
Net cash used in investing activities
(2,616
)
(2,120
)
CASH FLOWS FROM FINANCING ACTIVITIES
Partner distributions
(621,319
)
(398,284
)
Net cash used in financing activities
(621,319
)
(398,284
)
Net decrease in cash and cash equivalents
1,399,554
(233,325
)
Cash at beginning of year
1,171,274
1,402,294
Cash at end of year
$
2,570,828
$
1,168,969
See accompanying notes to unaudited condensed financial
statements
F-
75
DC&M PARTNERS, L.L.C.
Notes to Unaudited Financial Statements
June 30, 2016 and 2015
NOTE 1 - NATURE OF OPERATIONS
DC&M Partners, L.L.C.
(the "Company"), was formed incorporated in the State of Arizona on January 29, 2007. The Company provides clients
with a wide range of SAP development, consultancy, and management services.
NOTE 2 - SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
BASIS OF PRESENTATION
The Company has adopted the
Financial Accounting Standards Board ("FASB") Codification ("Codification" or "ASC"). The Codification
is the single official source of authoritative accounting principles generally accepted in the United States of America ("U.S.
GAAP") recognized by the FASB to be applied by nongovernmental entities. All of the Codification's content carries
the same level of authority.
USE OF ESTIMATES
The preparation of financial
statements in conformity with U.S. GAAP 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. Actual results could differ from those estimates.
REVENUE RECOGNITION
The Company recognizes revenue
in accordance with FASB ASC 985-605-25-79. Revenue is derived from time and expense contracts and is recognized as the services
are performed. Revenue received as reimbursements of billable expenses are reported gross within revenue and the related expenses
are recorded in operating expenses. Unbilled revenue comprises of revenue recognized in relation to efforts incurred on time and
expense contracts not billed at period end where services are performed in accordance with agreed terms. Customer advances represent
payments received in advance of an engagement and are deferred until the service is performed.
CASH AND CASH EQUIVALENTS
The Company considers all
highly liquid investments with an original maturity of three months or less to be cash equivalents.
ACCOUNTS RECEIVABLE
The Company routinely assesses
the financial strength of its customers and debtors and believes that its accounts receivable credit risk exposure is limited.
Accounts receivable are carried at the original invoice amount less an estimate made for doubtful receivables based on a review
of all outstanding amounts on a monthly basis. An allowance is provided for known and anticipated credit losses, as determined
by management in the course of regularly evaluating individual customer receivables. This evaluation takes into consideration
a customer's financial condition and credit history, as well as current economic conditions. Accounts receivable are considered
delinquent when they are over 90 days past due and are written off when deemed uncollectible. Recoveries of accounts receivable
previously written off are recorded in income when received.
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DC&M PARTNERS, L.L.C.
Notes to Unaudited Financial Statements
June 30, 2016 and 2015
PROPERTY AND EQUIPMENT
Property and equipment are
recorded at cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of
the assets, which range from 3 to 7 years.
Expenditures for maintenance
and repairs are charged to income as incurred. Additions and betterments are capitalized. The cost of properties sold or otherwise
disposed of, and the accumulated depreciation thereon, is eliminated from the property and reserve accounts, and gains and losses
are reflected in the consolidated statements of operations.
NOTE 3 - ACCOUNTS RECEIVABLE
Accounts receivable as of
June 30, 2016 and 2015 are summarized as follows:
Amounts due for services rendered and billed:
2016
2015
Outstanding less than 90 days
$
3,077,079
$
3,921,182
Outstanding more than 90 days
129,087
(175,745
)
3,206,166
3,745,437
Less: allowance for doubtful accounts
—
—
Amounts due for services rendered and billed, net
3,206,166
3,745,437
Amounts due for services rendered not billed:
Accounts receivable, net
$
3,206,166
$
3,745,437
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DC&M PARTNERS, L.L.C.
Notes to Unaudited Financial Statements
June 30, 2016 and 2015
NOTE 4 - PROPERTY AND EQUIPMENT
Property and equipment consists of the following at
June 30,
2016
2015
Office equipment
$
57,446
$
54,368
Fixed assets, gross
57,446
54,368
Less: accumulated depreciation
(53,305
)
(52,503
)
Fixed assets, net
$
4,141
$
1,865
Depreciation expense for the six-month
periods ended June30, 2016 and 2015 were $255, respectively.
NOTE 5 - INCOME TAXES
The Company accounts for income taxes under the provisions of
the FASB ASC 740,
Income Taxes
.
The Company elected to be taxed as a partnership
for income tax purposes effective June 3, 2001. Accordingly, the members are responsible for income taxes and no provision for
income taxes is included in these financial statements for the Company.
The Company's policy is to distribute
dividends to provide funds for members to pay income taxes on income reported by the Company. Periodically, additional distributions
are paid to reduce equity in excess of management's evaluation of the amount required for working capital. Management believes
the payment of additional distributions will not negatively impact profitability or impair the operating needs of the Company.
Equity distributions during the period ended June 30, 2015 and 2016 were $1,237,468 and $2,514,560, respectively.
The Company accounts for the effect of
any uncertain tax positions based on a more likely than not threshold to the recognition of the tax positions being sustained based
on the technical merits of the position under scrutiny by the applicable taxing authority. If a tax position or positions are deemed
to result in uncertainties of those positions, the unrecognized tax benefit is estimated based on a cumulative probability assessment
that aggregates the estimated tax liability for all uncertain tax positions. Interest and penalties assessed, if any, are accrued
as income tax expense.
F-
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DC&M PARTNERS, L.L.C.
Notes to Unaudited Financial Statements
June 30, 2016 and 2015
The Company has evaluated its
tax positions and determined no uncertainty requires recognition. The Company files income tax returns in the U.S. federal jurisdiction,
and various state jurisdictions, as well as the required foreign countries. The Company is generally no longer subject to U.S.
federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2011. All dues were paid off
as of the report date.
NOTE 6 - EMPLOYEE BENEFIT
PLAN
DEFERRED COMPENSATION
The Company reviews compensation
for members on an annual basis and accrues deferred compensation for any excess of amounts owed versus amounts paid to members.
As of June 30, 2016 and 2015, deferred compensation was $597,481 and $449,469, respectively.
NOTE 7 - RECENT ACCOUNTING PRONOUNCEMENTS
In August 2014, the FASB issued
amended guidance related to disclosure of uncertainties about an entity's ability to continue as a going concern. The new
guidance requires management to evaluate whether there is substantial doubt about the entity's ability to continue as a going
concern and, as necessary, to provide related footnote disclosures. The guidance has an effective date of December 31, 2016. The
Company believes that the adoption of this new standard will not have a material impact on its financial statements.
In May 2014, the FASB issued
Accounting Standard Update, or ASU, 2014-09-Revenue from Contracts with Customers, which provides a single, comprehensive revenue
recognition model for all contracts with customers. The core principal of this ASU is that an entity should recognize revenue when
it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to
be entitled in exchange for those goods or services. This ASU also requires additional disclosure about the nature, amount, timing
and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments
and assets recognized from costs incurred to obtain or fulfill a contract. This ASU is effective for annual periods, and interim
periods within those annual periods, beginning after December 15, 2016. Early adoption is not permitted. The Company is currently
evaluating the impact this ASU will have on its financial statements.
In January 2015, the FASB issued
ASU 2015-01-Income Statement-Extraordinary and Unusual Items, which seeks to simplify income statement presentation by eliminating
the concept of Extraordinary Items. This ASU eliminates from U.S. GAAP the concept of extraordinary items. Subtopic 225-20, Income
Statement—Extraordinary and Unusual Items, required that an entity separately classify, present, and disclose extraordinary
events and transactions. The amendments in this ASU are effective for fiscal years, and interim periods within those fiscal years,
beginning after December 15, 2015. A reporting entity may apply the amendments prospectively. A reporting entity also may apply
the amendments retrospectively to all prior periods presented in the financial statements. Early adoption is permitted provided
that the guidance is applied from the beginning of the fiscal year of adoption.
F-
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DC&M PARTNERS, L.L.C.
Notes to Unaudited Financial Statements
June 30, 2016 and 2015
In November 20, 2015, the FASB
issued ASU 2015-17, Balance Sheet Classification of Deferred Taxes. The ASU is part of the Board's simplification initiative
aimed at reducing complexity in accounting standards. Current U.S. GAAP requires the deferred taxes for each jurisdiction (or tax-paying
component of a jurisdiction) to be presented as a net current asset or liability and net noncurrent asset or liability. This requires
a jurisdiction-by-jurisdiction analysis based on the classification of the assets and liabilities to which the underlying temporary
differences relate, or, in the case of loss or credit carryforwards, based on the period in which the attribute is expected to
be realized. Any valuation allowance is then required to be allocated on a pro rata basis, by jurisdiction, between current and
noncurrent deferred tax assets. To simplify presentation, the new guidance requires that all deferred tax assets and liabilities,
along with any related valuation allowance, be classified as noncurrent on the balance sheet. As a result, each jurisdiction will
now only have one net noncurrent deferred tax asset or liability. Importantly, the guidance does not change the existing requirement
that only permits offsetting within a jurisdiction – that is, companies are still prohibited from offsetting deferred tax
liabilities from one jurisdiction against deferred tax assets of another jurisdiction.
NOTE 8 - OPERATING LEASES
The Company leases office space
in Chandler, Arizona under net operating lease agreement. Lease expense for leased property has been accounted for under the operating
lease method where ownership of the asset does not transfer to the lessee.
Operating lease expense was $18,046
and $31,700 for the years ended June 30, 2015 and 2016, respectively.
NOTE 9 - CONCENTRATION OF
CREDIT RISK
For the period ended June 30,
2015 and 2016, approximately 80% and 79%, respectively, of the Company's revenue was derived from ten customers. As of June30,
2015 and 2016, approximately 75% and 70%, respectively, of the Company's accounts receivable were due from five customers.
NOTE 10 - SUBSEQUENT EVENTS
The Company has evaluated subsequent
events through October 11, 2016, the date the unaudited financial statements were available to be issued.
On July 29, 2015, the Company
entered into a membership interest purchase agreement with Ameri Holdings Inc. ("AMERI"), which is based in Princeton,
New Jersey, for the purchase of all of the outstanding membership interests of the Company for consideration of: (a) a cash payment
in the amount of $3,000,000 at closing, (b) 1,600,000 shares of AMERI common stock, which are to be issued on July 29, 2018 or
upon a change of control of AMERI (whichever occurs earlier), and (c) earn-out payments to be paid, if earned, in 2017 and 2018,
all as more particularly outlined in the purchase agreement.
F-
80
UNAUDITED PRO FORMA COMBINED FINANCIAL
STATEMENTS
On July 29, 2016, Ameri Holdings, Inc. (the ''Company,''
''we,'' ''our'' or ''us'') completed the acquisition of
DC&M Partners, L.L.C. (''DC&M''). The accompanying unaudited pro forma condensed consolidated combined
statements of operations for the year ended December 31, 2016 present the combined results of our operations with DC&M as if
the acquisition and the financing for the acquisition had occurred on January 1, 2016. The historical unaudited pro forma condensed
consolidated financial information includes adjustments that are directly attributable to the acquisition, factually supportable
and with respect to the statement of operations are expected to have a continuing effect on our combined results. The unaudited
pro forma condensed consolidated combined financial information does not reflect the costs of any integration activities or benefits
that may result from realization of future cost savings from operating efficiencies, or any revenue, tax, or other synergies that
may result from the acquisition. The unaudited pro forma condensed consolidated combined financial information and related notes
are being provided for illustrative purposes only and are not necessarily indicative of what our financial position or results
of operations actually would have been had we completed the acquisition at the dates indicated nor are they necessarily indicative
of the combined company's future financial position or operating results of the combined company.
The accompanying unaudited pro forma condensed consolidated
combined financial information and related notes should be read in conjunction with our audited consolidated financial statements
for the years ended December 31, 2016 and 2015 and our unaudited condensed consolidated financial statements as of and for the
six months ended June 30, 2016 and 2015 and DC&M audited financial statements as of and for the years ended December 31, 2015
and 2014 and DC&M unaudited consolidated financial statements as of and for the three and six months ended June 30, 2016 and
2015.
We prepared the unaudited pro forma condensed consolidated combined
financial information pursuant to Regulation S-X Article 11. Accordingly, our cost to acquire DC&M of approximately $15.816
million has been allocated to the assets acquired and liabilities assumed according to their estimated fair values at the date
of acquisition. Any excess of the purchase price over the estimated fair value of the net assets acquired has been recorded as
goodwill. The preliminary estimates of fair values are reflected in the accompanying unaudited pro forma condensed consolidated
combined financial information. The final determination of these fair values will be completed as soon as possible but no later
than one year from the acquisition date. The final valuation will be based on the actual fair values of assets acquired and liabilities
assumed at the acquisition date. Although the final determination may result in asset and liability fair values that are different
than the preliminary estimates of these amounts included herein, it is not expected that those differences will be material to
an understanding of the impact of this transaction to our financial results.
F-
81
Unaudited Proforma Combined
Statement of Operations
For the Year Ended December 31, 2016
Ameri
Holdings
DC&M
Partners
Combined Historical
Proforma Adjustments
Proforma Combined
Revenue
28,493,511
20,095,857
48,589,368
48,589,368
Cost of Revenue
23,322,828
16,378,738
39,701,566
39,701,566
Gross Profit
5,170,683
3,717,119
8,887,802
-
8,887,802
Operating Expenses:
Selling & Marketing
50,262
6,236
56,498
56,498
General & Administration
7,888,805
2,287,254
10,176,059
10,176,059
Acquisition related expenses
1,585,136
-
1,585,136
1,585,136
Depreciation and Amortization
1,361,169
12
1,361,181
1,361,181
Operating Expenses
10,885,372
2,293,502
13,178,874
-
13,178,874
Operating Income (Loss)
(5,714,689)
1,423,617
(4,291,072)
-
(4,291,072)
Interest expense
(727,045)
(24,470)
(751,515)
(751,515)
Other Income(Expenses)
16,604
(141,303)
(124,699)
(124,699)
Change due to estimate correction
(410,817)
(410,817)
(410,817)
Total other Income (expenses)
(1,121,258)
(165,773)
(1,287,031)
-
(1,287,031)
Net Income (loss) before income taxes
(6,835,947)
1,257,844
(5,578,103)
-
(5,578,103)
Income tax benefit (provision)
3,747,846
3,747,846
3,747,846
Net Income (loss)
(3,088,101)
1,257,844
(1,830,257)
-
(1,830,257)
Non Controlling Interest
(3,382)
(3,382)
(3,382)
Net income (loss) attributable to the Company
(3,091,483)
1,257,844
(1,833,639)
-
(1,833,639)
Foreign exchange translation adjustment
(7,426)
(7,426)
(7,426)
Comprehensive income (loss)
(3,098,909)
1,257,844
(1,841,065)
-
(1,841,065)
Note 1 — Basis of presentation
The unaudited pro forma condensed combined
financial statements are based on Ameri Holdings, Inc. (the "Company") and DC&M Partners, L.L.C. ("DC&M)
historical consolidated financial statements as adjusted to give effect to the acquisition of DC&M by the Company. The unaudited
pro forma combined statements of operations for the 12 months ended December 31, 2016 give effect to the DC&M acquisition as
if it had occurred on January 1, 2016.
Note 2 — Preliminary purchase
price allocation
On July 29, 2016, the Company acquired
DC&M for total consideration of approximately $15.816 million. The unaudited pro forma condensed combined financial information
includes various assumptions, including those related to the preliminary purchase price allocation of the assets acquired and liabilities
assumed of DC&M based on management's best estimates of fair value. The final purchase price allocation may vary based
on final appraisals, valuations and analyses of the fair value of the acquired assets and assumed liabilities. Accordingly, the
pro forma adjustments are preliminary and have been made solely for illustrative purposes.
F-
82
The following table shows the preliminary
allocation of the purchase price for DC&M to the acquired identifiable assets, liabilities assumed and pro forma goodwill:
Total purchase price
$
15,816,000
Cash and cash equivalents
2,564,108
Accounts receivable
3,206,166
Deposit and other expense
22,263
Other - Customer Lists
5,400,000
Total identifiable assets
11,192,537
Accounts payable and accrued expenses
2,743,310
Taxes Payable
—
Other payable
592,538
Total liabilities assumed
3,335,848
Net assets acquired
7,856,689
Total pro forma goodwill
$
7,959,311
Note 3 — Pro forma adjustments
The pro forma adjustments are based on
our preliminary estimates and assumptions that are subject to change. The following adjustments have been reflected in the unaudited
pro forma condensed combined financial information:
Adjustments to the pro forma condensed
combined balance sheet:
(1) Reflect the investment in a subsidiary
and the payment of the purchase price; and
(2) Reflect the preliminary estimate of
goodwill, which represents the excess of the purchase price over the fair value of DC&M's identifiable assets acquired
and liabilities assumed as shown in Note 2.
F-
83
CERTIFIED PUBLIC ACCOUNTANTS REPORT
OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
The Board of Directors,
We have audited the accompanying consolidated
balance sheets of ATCG Technology Solutions, Inc. and its subsidiary (together, the "Company") as of December 31, 2016
and 2015 and the related consolidated statements of income, retained earnings and cash flows for the years then ended. These consolidated
financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these consolidated
financial statements based on our audits.
We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform
the 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 audits provide
a reasonable basis for our opinion.
In our opinion, the consolidated financial
statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31,
2016 and 2015 and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles
generally accepted in the United States of America.
/s/ Ram Associates
Ram Associates
Hamilton, NJ
May 18, 2017
3240 EAST STATE STREET EXT. + HAMILTON,
NJ08619 + (609) 631-9552/63 1-9553 + FAX (888) 319-8898
PKRAM@RAMASSOCIATES.US
F-
84
ATCG Technology Solutions, Inc. and
Subsidiary
Consolidated Balance Sheets
December 31,
2016
2015
ASSETS
CURRENT ASSETS
Cash
$
163,548
$
50,630
Accounts receivable, net
787,812
277,194
Other Current Assets
487,852
135,951
TOTAL CURRENT ASSETS
1,439,212
463,775
PROPERTY AND EQUIPMENT, NET
27,721
16,427
INTANGIBLE ASSET
1,027,500
—
TOTAL ASSETS
$
2,494,433
480,202
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Accounts payable
$
351,144
406,398
Other Current Liabilities
850,141
94,896
Deferred Tax Liability
687
—
TOTAL LIABILITIES
1,201,972
501,294
STOCKHOLDERS EQUITY
Common Stock
8,563
1,000
Preferred Stock
17,532
12,123
Additional Paid in Capital
8,000,561
5,636,033
Retained Earnings
(6,738,135
)
(5,679,964
)
Non-Controlling Interest
3,940
9,716
1,292,461
(21,092
)
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
$
2,494,433
$
480,202
See accompanying notes to financial statements
F-
85
ATCG Technology Solutions, Inc. and
Subsidiary
Consolidated Statements of Income and
Comprehensive Income
Years Ended December 31,
2016
2015
REVENUES
$
5,968,330
$
1,399,305
COST OF SALES
4,443,335
1,327,562
Gross profit
1,524,995
71,743
OPERATING EXPENSES
General and administrative expenses
2,589,077
1,865,904
Depreciation
8,386
146,157
TOTAL OPERATING EXPENSES
2,597,463
2,012,061
Loss from operations
(1,072,468
)
(1,940,318
)
OTHER INCOME (EXPENSES)
Interest income
103
—
Other income
15,000
7
Gain on sale of asset
1,736
—
Interest expense
(4,767
)
—
TOTAL OTHER INCOME
12,072
7
Loss before income tax expense
(1,060,396
)
(1,940,311
)
Deferred Tax
(687
)
—
(1,061,083
)
(1,940,311
)
Net income (loss) attributable to non-controlling interest
5,112
(7,128
)
Net loss attributable to ATCG Technology Solutions, Inc. stockholders
(1,055,971
)
(1,947,439
Other comprehensive income (loss):
Foreign currency translation adjustment
(2,200
)
838
Net loss
$
(1,058,171
)
$
(1,946,601
)
See accompanying notes to financial statements
F-
86
ATCG Technology Solutions, Inc. and
Subsidiary
Consolidated Statement of Stockholders'
Equity
Common
    Stock
Preferred
    Stock
Shares
Par
                                         Value
at
        $0.001
Shares
Par
                                         Value
at
        $0.001
Additional
paid-in
capital
Other
Comprehensive
income
        (loss)
Retained
earnings
Non-
Controlling
Interests
Total
stockholders'equity
Balance at December
    31, 2014
1,000,000
$
1,000
71,628
72
$
2,836,615
$
-
$
(3,733,363
)
$
(895,676
)
Issuance of capital
12,051,392
12,051
2,799,418
-
-
2,811,469
Net Loss
-
-
-
838
(1,947,439
)
9,716
(1,936,885
)
Balance at December 31, 2015
1,000,000
$
1,000
12,123,020
12,123
$
5,636,033
$
838
$
(5,680,802
)
9,716
$
(21,092
)
Issuance of Equity Capital for acquisition
2,562,500
2,563
414,937
417,500
Issuance of Preference Capital for acquisition
1,500,282
$
1,500
348,501
350,001
Issuance of Equity
5,000,000
5,000
916,467
921,467
Issuance for Preference
3,908,533
3,909
684,623
688,531
Non-Controlling Interests
(5,776
)
(5,776
)
Accumulated other comprehensive income (loss)
(2,200
)
(1,055,971
)
(1,058,170
)
Balance at December 31, 2016
8,562,500
$
8,563
17,531,835
$
17,532
$
8,000,561
$
(1,362
)
$
(6,736,773
)
$
3,940
$
1,292,461
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87
ATCG Technology Solutions, Inc. and
Subsidiary
Consolidated Statements of Cash Flows
Year Ended December 31,
2016
2015
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss
$
(1,058,171
)
$
(1,946,601
)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation
8,386
146,157
Deferred Tax
687
—
FCTR Adjustment
2,200
838
Gain on sale of Asset
(1,736
)
—
Changes in assets and liabilities:
Accounts receivable
(510,618
)
(138,925
)
Other current assets
(351,901
)
(117,055
)
Current Liabilities
700,677
342,380
Net cash used in operating activities
(1,210,476
)
(1,713,206
)
CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures
(271,494
)
(4,635
)
Net cash used in investing activities
(271,494
)
(4,635
)
CASH FLOWS FROM FINANCING ACTIVITIES
Capital Infusion
1,600,000
1,400,000
Non-controlling interest
(5,112
)
7,128
Net cash provided by financing activities
1,594,888
1,407,128
Net decrease in cash and cash equivalents
112,918
(310,713
)
Cash at beginning of year
50,630
361,343
Cash at end of year
$
163,548
$
50,630
See accompanying notes to financial statements
F-
88
ATCG Technology Solutions, Inc. and
Subsidiary
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
NOTE 1 - NATURE OF OPERATIONS
ATCG Technology Solutions, Inc. (the "Company")
was formed in the State of Delaware on December 23, 2011. The Company provides clients with a wide range of SAP development, consultancy
and management services.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
FOREIGN OPERATIONS AND FOREIGN CURRENCY
The operations of the Company's foreign
subsidiary, Ameritas Technologies India Private Limited, a company formed and operating under the laws of India (the "Subsidiary"),
are subject to risks inherent in operating under different legal systems and various political and economic environments. Among
the risks are changes in existing tax laws, possible limitations on foreign investment and income repatriation, government price
or foreign exchange controls and restrictions on foreign exchange. Cash held in foreign based bank accounts as of December 31,
2016 was approximately $23,428.
The Subsidiary transacts business in its
local currency. The financial statements reflect the translation of the functional currency statements to U.S. Dollars. Financial
statements use end of period exchange rates for assets and liabilities, weighted average exchange rates for revenue and expenses.
The resulting foreign currency translation adjustment is recorded in accumulated other comprehensive income (loss) as a component
of equity.
BASIS OF PRESENTATION
The Company has adopted the Financial Accounting
Standards Board ("FASB") Codification ("Codification" or "ASC"). The Codification is the single official
source of authoritative accounting principles generally accepted in the United States of America ("U.S. GAAP") recognized
by the FASB to be applied by nongovernmental entities. All of the Codification's content carries the same level of authority.
USE OF ESTIMATES
The preparation of financial statements
in conformity with U.S. GAAP 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. Actual results could differ from those estimates.
REVENUE RECOGNITION
The Company recognizes revenue in accordance
with FASB ASC 985-605-25-79. Revenue is derived from time and expense contracts and is recognized as the services are performed.
Revenue received as reimbursements of billable expenses are reported gross within revenue and the related expenses are recorded
in operating expenses. Unbilled revenue comprises of revenue recognized in relation to efforts incurred on time and expense contracts
not billed at period end where services are performed in accordance with agreed terms. Customer advances represent payments received
in advance of an engagement and are deferred until the service is performed.
CASH AND CASH EQUIVALENTS
The Company considers all highly liquid
investments with an original maturity of three months or less to be cash equivalents.
F-
89
ATCG Technology Solutions, Inc. and
Subsidiary
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
ACCOUNTS RECEIVABLE
The Company routinely assesses the financial
strength of its customers and debtors and believes that its accounts receivable credit risk exposure is limited. Accounts receivable
are carried at the original invoice amount less an estimate made for doubtful receivables based on a review of all outstanding
amounts on a monthly basis. An allowance is provided for known and anticipated credit losses, as determined by management in the
course of regularly evaluating individual customer receivables. This evaluation takes into consideration a customer's financial
condition and credit history, as well as current economic conditions. Accounts receivable are considered delinquent when they are
over 90 days past due and are written off when deemed uncollectible. Recoveries of accounts receivable previously written off are
recorded in income when received.
PROPERTY AND EQUIPMENT
Property and equipment are recorded at
cost. Depreciation and amortization are provided using the straight-line method over the estimated useful lives of the assets,
which range from 3 to 7 years.
Expenditures for maintenance and repairs
are charged to income as incurred. Additions and betterments are capitalized. The cost of properties sold or otherwise disposed
of, and the accumulated depreciation thereon, is eliminated from the property and reserve accounts, and gains and losses are reflected
in the consolidated statements of operations.
INCOME TAXES
The Company accounts for the effect of
any uncertain tax positions based on a more likely than not threshold to the recognition of the tax positions being sustained based
on the technical merits of the position under scrutiny by the applicable taxing authority. If a tax position or positions are deemed
to result in uncertainties of those positions, the unrecognized tax benefit is estimated based on a cumulative probability assessment
that aggregates the estimated tax liability for all uncertain tax positions. Interest and penalties assessed, if any, are accrued
as income tax expense.
The Company has evaluated its tax positions
and determined no uncertainty requires recognition. The Company files income tax returns in the U.S. federal jurisdiction, and
various state jurisdictions, as well as the required foreign countries. The Company is generally no longer subject to U.S. federal,
state and local, or non-U.S. income tax examinations by tax authorities for years before 2011.
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ATCG Technology Solutions, Inc. and
Subsidiary
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
NOTE 3 - ACCOUNTS RECEIVABLE
Accounts receivable as of December 31,
2016 and 2015 are summarized as follows:
Amounts due for services rendered and billed:
2016
2015
Outstanding less than 90 days
$
787,812
$
277,194
Outstanding more than 90 days
—
787,812
277,194
Less: allowance for doubtful accounts
—
—
Amounts due for services rendered and billed, net
787,812
277,194
Amounts due for services rendered not billed:
—
—
Accounts receivable, net
$
787,812
$
277,194
NOTE 4 - PROPERTY AND EQUIPMENT
Property and equipment consists of the following at December
31,
2016
2015
Office equipment
$
148,172
$
129,283
Leasehold Improvements
163,290
163,290
Fixed assets, gross
311,462
286,047
Less: accumulated depreciation
(283,741
)
(269,620
)
Fixed assets, net
$
27,721
$
16,427
Depreciation expense for the years ended
December 31, 2016 and 2015 were $8,386 and $146,157, respectively. The depreciation expense for year ended December 31, 2015 includes
the write off of the balance of leasehold improvements.
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ATCG Technology Solutions, Inc. and
Subsidiary
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
NOTE 5 - INCOME TAXES
The Company accounts for income taxes under
the provisions of the FASB ASC 740,
Income Taxes
. Although the Company's management believes that their tax estimates are
reasonable, there is no assurance that the final determination of tax liability will not be different from what is reflected in
the Company's income tax provisions and accruals.
NOTE 6 - RECENT ACCOUNTING PRONOUNCEMENTS
On May 28, 2014, the FASB issued Accounting
Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606), with an effective date for annual reporting periods
beginning after December 15, 2016, including interim periods within that reporting period, for public business entities, certain
not-for-profit entities, and certain employee benefit plans. The effective date for all other entities was for annual reporting
periods beginning after December 15, 2017, and interim periods within annual periods beginning after December 15, 2018. The amendments
in this Update defer the effective date of Update 2014-09. Public business entities, certain not-for-profit entities, and certain
employee benefit plans should apply the guidance in Update 2014-09 to annual reporting periods beginning after December 15, 2017,
including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting
periods beginning after December 15, 2016, including interim reporting periods within that reporting period. All other entities
should apply the guidance in Update 2014-09 to annual reporting periods beginning after December 15, 2018, and interim reporting
periods within annual reporting periods beginning after December 15, 2019. Earlier application is permitted only as of an annual
reporting period beginning after December 15, 2016, including interim reporting periods within that reporting period, or an annual
reporting period beginning after December 15, 2016, and interim reporting periods within annual reporting periods beginning one
year after the annual reporting period in which an entity first applies the guidance in Update 2014-09. The Company does not believe
the effect of implementing the above statement will have a material impact on its financial statements.
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ATCG Technology Solutions, Inc. and
Subsidiary
Notes to Consolidated Financial Statements
December 31, 2016 and 2015
NOTE 7 - OPERATING LEASES
The Company leases its principal office
space in Folsom, California and Noida in India under net operating lease agreements. Lease expense for leased property has been
accounted for under the operating lease method where ownership of the asset does not transfer to the lessee.
Operating lease expense was $95,517 and
$249,678 for the years ended December 31, 2016 and 2015, respectively.
NOTE 8 - CONCENTRATION OF CREDIT RISK
For the years ended December 31, 2016 and
2015, approximately 87% and 64%, respectively, of the Company's revenue was derived from four and two customers, respectively.
As of December 31, 2016 and 2015, approximately 86% and 95%, respectively, of the Company's accounts receivable were due from five
customers.
NOTE 9 - SUBSEQUENT EVENTS
The Company has evaluated subsequent events
through May 18, 2017, the date the financial statements were available to be issued.
On March 10, 2017, the Company entered
into a purchase agreement with Ameri Holdings Inc ("Ameri") which is based in Princeton, New Jersey, for the purchase
of all of the outstanding shares of the Company. The aggregate purchase price for the acquisition of the Company was $8,784,533,
consisting of:
(a)
576,923 shares of our common stock;
(b)
Unsecured promissory notes for the aggregate amount
of $3,750,000 (which notes bear interest at a rate of 6% per annum with a payment schedule of 50% on December 31, 2017 and 50%
on June 30, 2018);
(c)
Earn-out payments in shares of our common stock (up
to an aggregate value of $1,200,000 worth of shares) to be paid, if earned, in each of 2018 and 2019; and
(d)
An additional cash payment of $55,687 for cash that
was left in ATCG at closing.
The total purchase price of $8,784,533
was allocated to intangibles of $3.75 million, taking into consideration projected revenue from the acquired list of ATCG customers
over a period of three years, and goodwill. The excess of total purchase price over the intangibles allocation has been allocated
to goodwill.
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UNAUDITED PRO FORMA COMBINED FINANCIAL
STATEMENTS
On March 10, 2017, Ameri Holdings, Inc.
(the ''Company,'' ''we,'' ''our'' or ''us'') completed the acquisition of ATCG Technology Solutions, Inc. ("ATCG").
The accompanying unaudited pro forma condensed consolidated combined statements of operations for the fiscal year ended December
31, 2016 present the combined results of our operations with ATCG as if the acquisition and the financing for the acquisition had
occurred on January 1, 2016. The historical unaudited pro forma condensed consolidated financial information includes adjustments
that are directly attributable to the acquisition, factually supportable and with respect to the statement of operations are expected
to have a continuing effect on our combined results. The unaudited pro forma condensed consolidated combined financial information
does not reflect the costs of any integration activities or benefits that may result from realization of future cost savings from
operating efficiencies, or any revenue, tax, or other synergies that may result from the acquisition. The unaudited pro forma condensed
consolidated combined financial information and related notes are being provided for illustrative purposes only and are not necessarily
indicative of what our financial position or results of operations actually would have been had we completed the acquisition at
the dates indicated nor are they necessarily indicative of the combined company's future financial position or operating results
of the combined company.
The accompanying unaudited pro forma condensed
consolidated combined financial information and related notes should be read in conjunction with our consolidated financial statements
for year ending December 31, 2016 and ATCG audited financial statements as of and for the years ended December 31, 2016.
We prepared the unaudited pro forma condensed
consolidated combined financial information pursuant to Regulation S-X Article 11. Accordingly, our cost to acquire ATCG of approximately
$8.75 million has been allocated to the assets acquired and liabilities assumed according to their estimated fair values at the
date of acquisition. Any excess of the purchase price over the estimated fair value of the net assets acquired has been recorded
as goodwill. The preliminary estimates of fair values are reflected in the accompanying unaudited pro forma condensed consolidated
combined financial information. The final determination of these fair values will be completed as soon as possible but no later
than one year from the acquisition date. The final valuation will be based on the actual fair values of assets acquired and liabilities
assumed at the acquisition date. Although the final determination may result in asset and liability fair values that are different
than the preliminary estimates of these amounts included herein, it is not expected that those differences will be material to
an understanding of the impact of this transaction to our financial results.
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AMERI HOLDINGS, INC.
Unaudited Pro Forma Combined Statement
of Operations
For the year ended December 31, 2016
Ameri
Holdings,
Inc.
ATCG
Technology
Solutions
Inc.
Combined
Historical
Pro Forma
Adjustments
Pro Forma
Combined
Revenue
$
36,145,589
5,968,330
42,113,919
42,113,919
Cost of revenue
29,608,932
4,443,335
34,052,267
34,052,267
Gross profit
Operating expenses:
Selling and marketing expenses
417,249
48,258
465,507
465,507
General and administration expenses
8,552,966
2,540,820
11,093,786
11,093,786
Acquisition related expenses
1,585,136
1,585,136
1,585,136
Depreciation and Amortization
1,361,169
8,386
1,369,555
1,369,555
11,916,520
2,598,150
14,514,670
14,514,670
Income before other income / (expenses)
(5,379,863
)
(1,072,469
)
(6,452,332
)
(6,452,332
)
Net Interest expense
(751,704
)
(4,664
)
(755,738
)
(755,738
)
Other income (expense)
16,604
15,000
31,604
31,604
Changes due to estimate correction
(410,817
)
(410,817
)
(410,817
)
Loss on sale of fixed assets
1,736
1,736
1,736
Net income before income tax
(6,525,150
)
(1,060,397
)
(7,585,547
)
(7,585,547
)
Provision for income taxes
3,747,846
(687
)
3,747,159
3,747,159
Net Income (loss)
(2,777,304
)
(1,061,084
)
(3,841,859
)
(3,838,338
)
Unrealized foreign currency translation income
(7,426
)
(2,200
)
(9,626
)
(9,626
)
Non-controlling Interest
(3,382
)
5,112
1,730
1,730
Net and comprehensive income for the period
$
(2,788,112
)
(1,058,172
)
(3,846,284
)
(3,846,284
)
See notes attached to the proforma financial
statements
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95
Note 1 — Basis of presentation
The unaudited pro forma condensed combined
financial statements are based on Ameri Holdings, Inc. (the "Company") and ATCG Technology Solutions Inc. ("ATCG")
historical consolidated financial statements as adjusted to give effect to the acquisition of ATCG by the Company. The unaudited
pro forma combined statements of operations for the year ended December 31, 2016 give effect to the ATCG acquisition as if it had
occurred on January 1, 2016.
Note 2 — Preliminary purchase
price allocation
On March 10, 2017, the Company acquired
ATCG for total consideration of approximately $8.75 million. The unaudited pro forma condensed combined financial information includes
various assumptions, including those related to the preliminary purchase price allocation of the assets acquired and liabilities
assumed of ATCG based on management's best estimates of fair value. The final purchase price allocation may vary based on final
appraisals, valuations and analyses of the fair value of the acquired assets and assumed liabilities. Accordingly, the pro forma
adjustments are preliminary and have been made solely for illustrative purposes.
The following table shows the preliminary
allocation of the purchase price for ATCG to the acquired identifiable assets, liabilities assumed and pro forma goodwill:
Total purchase price
$
8,784,533
Cash and cash equivalents
163,548
Accounts receivable
787,812
Deposit and other expense
487,852
Tangible Assets
27,752
Intangible Asset
1,027,500
Other - Customer Lists
3,750,000
Total identifiable assets
6,244,464
Accounts payable and accrued expenses
1,205,943
Taxes Payable
—
Other payable
—
Total liabilities assumed
1,205,943
Net assets acquired
5,038,251
Total pro forma goodwill
$
3,746,012
Note 3 — Pro forma adjustments
The pro forma adjustments are based on
our preliminary estimates and assumptions that are subject to change. The following adjustments have been reflected in the unaudited
pro forma condensed combined financial information:
Adjustments to the pro forma condensed
combined balance sheet:
(1) Reflect the investment in a subsidiary
and the payment of the purchase price; and
(2) Reflect the preliminary estimate of
goodwill, which represents the excess of the purchase price over the fair value of ATCG identifiable assets acquired and liabilities
assumed as shown in Note 2.
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________________
Shares
Common
Stock
PROSPECTUS
Ladenburg Thalmann & Co. Inc.
______________, 2017
PART II - INFORMATION NOT REQUIRED
IN PROSPECTUS
Item 13. OTHER EXPENSES OF ISSUANCE AND
DISTRIBUTION.
The following table
sets forth the costs and expenses payable by the registrant in connection with this offering. All of the amounts shown are estimates
except the Securities and Exchange Commission (the "
SEC
") registration fee.
SEC registration fee
$
FINRA filing fee
Nasdaq listing fee and expenses
50,000.00
Printing and EDGAR expenses
Legal fees and expenses
Underwriters' expense reimbursement
100,000
Accounting fees and expenses
Transfer Agent and Registrar fees and expenses
Miscellaneous
Total
$
We will bear all costs,
expenses and fees in connection with the registration of these shares, including with regard to compliance with state securities
or "blue sky" laws. The selling security holder, however, will bear all commissions and discounts, if any, attributable
to its sale of securities.
Item 14. INDEMNIFICATION OF DIRECTORS
AND OFFICERS
Our Certificate of
Incorporation provides that, to the fullest extent permitted by the Delaware General Corporation Law, our directors shall not be
personally liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director. Our Bylaws provide
that, to the fullest extent permitted by Delaware law, we will indemnify, and advance expenses to, a director or officer in an
action brought by reason of the fact that the director or officer is or was our director or officer, or is or was serving at our
request as a director or officer of any other entity, against all expenses, liability and loss reasonably incurred or suffered
by such person in connection therewith. We may maintain insurance to protect a director or officer against any expense, liability
or loss, whether or not we would have the power to indemnify such person against such expense, liability or loss under Delaware
law.
The limitation of liability
and indemnification provisions in our Certificate of Incorporation and Bylaws may discourage stockholders from bringing a lawsuit
against directors for breach of their fiduciary duty. These provisions may also have the effect of reducing the likelihood of derivative
litigation against our directors and officers, even though such an action, if successful, might otherwise benefit us and our stockholders.
However, these provisions do not limit or eliminate our rights, or those of any stockholder, to seek non-monetary relief such as
injunction or rescission in the event of a breach of a director's duty of care. The provisions will not alter the liability
of directors under the federal securities laws. In addition, your investment may be adversely affected to the extent that, in a
class action or direct suit, we pay the costs of settlement and damage awards against directors and officers pursuant to these
indemnification provisions. There is currently no pending litigation or proceeding against any of our directors, officers or employees
for which indemnification is sought.
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Indemnification Agreements
We have entered into
indemnification agreements with each of our directors and executive officers. Each indemnification agreement provides that, subject
to limited exceptions, and among other things, we will indemnify the director or executive officer to the fullest extent permitted
by law for claims arising in his or her capacity as our director or officer.
Item 15. RECENT SALES OF UNREGISTERED
SECURITIES
During the past two
years, we sold the following securities without registration under the Securities Act:
Lone Star Value
For
the purpose of financing the ongoing business and operations of our company following the Merger, on May 26, 2015 we completed
the Private Placement, issuing the Convertible Note in the principal amount of $5,000,000, together with the Original Warrant,
pursuant to the terms of the Securities Purchase Agreement with LSVI. The Convertible Note was unsecured and was to become due
on May 26, 2017, the second anniversary of the issue date. Prior to maturity, the Convertible Note bore interest at 5% per annum,
with interest being paid semiannually on the first day of each of the first and third calendar quarters. From and after an event
of default and for so long as the event of default was continuing, the Convertible Note was to bear default interest at the rate
of 10% per annum. The Convertible Note could be prepaid by us at any time without penalty.
The
Convertible Note was convertible into shares of our common stock at a conversion price of $1.80 per share, or an aggregate of 2,777,778
shares of common stock, subject to adjustment under certain circumstances. The Convertible Note ranked senior to all of our other
obligations, except for trade payables in the ordinary course of business, purchase money asset financing and any inventory or
receivables-based credit facility that we may obtain in the future, provided that the amount of the credit facility does not exceed
50% of eligible inventory and 80% of eligible receivables. The Convertible Note also included certain negative covenants including,
without LSVI's approval, restrictions on debt and security interests, mergers and the purchase and sale of assets, dividends
and other restricted payments, and investments.
The
Original Warrant issued in the Private Placement gave LSVI the right to purchase up to 2,777,777 shares of common stock (equivalent
to 100% warrant coverage in respect of the shares underlying the Convertible Note) at an exercise price equal to $1.80 per share.
The Original Warrant may be exercised on a cashless-exercise basis, meaning that, upon exercise, the holder would make no cash
payment to us, and would receive a number of shares of our common stock having an aggregate value equal to the excess of the then-current
market price of the shares issuable upon exercise of the Original Warrant over the exercise price of the Warrant. The Original
Warrant expires on May 26, 2020.
On
May 13, 2016, LSVI completed an early partial exercise of its Original Warrant for 1,111,111 shares of our common stock at a price
of $1.80 per share, for total consideration to us of $2,000,000, and LSVI was issued a replacement warrant for the remaining
1,166,666 shares under the Original Warrant on the same terms as the Original Warrant. LSVI also agreed to an amendment of the
Convertible Note to extend the maturity of the Convertible Note for two years in exchange for (i) the right to request that the
Board expand the size of the Board to nine directors from the current eight, with LSVI having the right to designate up to four
of the nine directors, and (ii) the issuance of the Additional Warrant for the purchase of 1,000,000 shares of the Company's
common stock at a price of $6.00 per share, on substantively the same terms as the Original Warrant, except the Additional Warrant
may only be exercised for cash. LSVI's Registration Rights Agreement, dated May 26, 2015, with the Company was also amended
and restated to include the shares of common stock issuable under the Additional Warrant.
On December 30,
2016, the Company entered into the Exchange Agreement with LSVI, pursuant to which the Convertible Note was returned to the Company
and cancelled in exchange for 363,611 shares of the Company's Series A Preferred Stock, which is non-convertible and perpetual
preferred stock of the Company. As a result of the exchange transaction, no principal or interest remained outstanding or payable
under the Convertible Note and the Convertible Note was no longer convertible into shares of common stock of the Company. The Company
issued 10,097 shares of Series A Preferred Stock to LSVI in May 2017 as payment of a dividend on the shares of Series A Preferred
Stock held by LSVI as of March 31, 2017.
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2
2015 and 2016
Issuances
On
November 20, 2015, we issued 235,295 restricted shares of our common stock to the two former shareholders of Ameri Georgia as part
of the total consideration for the acquisition of Ameri Georgia. The former shareholders and officers of Ameri Georgia made representations
to us regarding their knowledge and experience, ability to bear economic risk and investment purpose with respect to the restricted
shares they received.
On
April 20, 2016, we entered into a Stock Purchase Agreement with Dhruwa N. Rai, an investor identified by the Company and who subsequently
became a director of the Company, pursuant to which Mr. Rai purchased 500,000 restricted shares of our common stock from us at
a price per share of $6.00 for aggregate consideration to us of $3,000,000. Mr. Rai
made
representations to us regarding his knowledge and experience, ability to bear economic risk and investment purpose with respect
to the restricted shares he purchased.
On
June 23, 2016, we entered into a definitive agreement to purchase Bigtech. The acquisition of Bigtech was effective as of July
1, 2016, and as part of the consideration paid for the acquisition, we delivered to Bigtech's two former shareholders and
officers warrants for the purchase of an aggregate 51,000 restricted shares of our common stock.
Pursuant
to the terms of the warrants, the former Bigtech shareholders acknowledged that the warrants represented unregistered securities
that may not be sold or offered except pursuant to an effective registration statement and that any shares issued upon exercise
of the warrants would be restricted and held for each such former shareholder's own account.
On
July 22, 2016, we issued 101,250 restricted shares of our common stock to the former sole member and chief executive officer of
Virtuoso as part of the total consideration for the acquisition of Virtuoso .The shares were issued with a value of $6.51 per share.
The former sole member of Virtuoso made representations to us regarding his knowledge and experience, ability to bear economic
risk and investment purpose with respect to the restricted shares he received.
On
July 29, 2016, we became obligated to issue 1,600,000 restricted shares of our common stock to the three former members and managing
partners of Ameri Arizona as part of the total consideration for the acquisition of Ameri Arizona. The restricted shares are to
be issued on July 29, 2018 or upon a change of control of the Company (whichever occurs earlier).
The
former members of
Ameri Arizona
made representations to us regarding their knowledge
and experience, ability to bear economic risk and investment purpose with respect to the restricted shares they received.
On
September 1, 2016, we issued 299,250 restricted shares of common stock to Srinidhi "Dev" Devanur, our Executive Chairman,
in connection with the completion of our acquisition of Ameri India on July 1, 2016, pursuant to the terms of a Stock Purchase
Agreement dated May 26, 2015.
Mr. Devanur previously
made representations to us regarding
his knowledge and experience, ability to bear economic risk and investment purpose with respect to the restricted shares he acquired.
2017 Issuances
On
January 27, 2017, the Company issued 33,333 restricted shares of its common stock its legal counsel, Olshan Frome Wolosky LLP ("Olshan"),
in exchange for the cancellation of a portion of accrued and unpaid legal fees owed by the Company to Olshan. Each of the Olshan
partners who received restricted shares is a sophisticated investor with knowledge and experience of financial and business matters
related to an investment in the Company's securities. In addition, restricted shares bear transfer restrictions and the recipients
acquired such securities for their own respective accounts without a view to resell or distribute them.
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3
On
March 7, 2017, we completed the sale and issuance of an aggregate of $1,250,000 in 8% Convertible Unsecured Promissory Notes (the
"2017 Notes") to four accredited investors, including one of the Company's directors, Dhruwa N. Rai. The 2017
Notes were issued pursuant to Securities Purchase Agreements with each investor, pursuant to which each investor purchased its
2017 Note from the Company. The 2017 Notes will bear interest at 8% per annum until maturity in March 2020, with interest being
paid annually on the first, second and third anniversaries of the issuance of the 2017 Notes beginning in March 2018. From and
after an event of default and for so long as the event of default is continuing, the 2017 Notes will bear default interest at the
rate of 10% per annum. The 2017 Notes can be prepaid by us at any time without penalty.
The
2017 Notes are convertible into shares of our common stock at a conversion price equal to $_______ (equal to 68% of the price per
share of the common stock sold in this offering). Upon the effectiveness of this registration statement, the holders of the 2017
Notes have the right, at their option, at any time and from time to time to convert, in part or in whole, the outstanding principal
amount and all accrued and unpaid interest under the 2017 Notes into shares of the Company's common stock at the then applicable
conversion price.
The
2017 Notes rank junior to our secured credit facility with Sterling National Bank. The 2017 Notes also include certain negative
covenants including, without the investors' approval, restrictions on dividends and other restricted payments and reclassification
of its stock.
The 2017 Notes purchasers made representations to us regarding their knowledge
and experience, ability to bear economic risk and investment purpose with respect to the 2017 Notes they purchased. Pursuant to
the terms of the 2017 Notes purchase agreement, the purchasers acknowledged that the 2017 Notes represented unregistered securities
that may not be sold or offered except pursuant to an effective registration statement and that any shares issued upon conversion
of the 2017 Notes would be restricted and held for each holder's own account.
On
March 10, 2017, we issued 576,923 restricted shares of our common stock to the nine former stockholders of Ameri California as
part of the total consideration for the acquisition of Ameri California. The shares were issued with a value of $6.50 per share. The
former shareholders of Ameri California made representations to us regarding their knowledge and experience, ability to bear economic
risk and investment purpose with respect to the restricted shares they received.
The
foregoing issuances were exempt from registration under Section 4(a)(2) of the Securities Act as sales by an issuer not involving
a public offering. None of the foregoing issuances were registered under the Securities Act, or the securities laws of any state,
and were offered and sold in reliance on the exemption from registration afforded by Section 4(a)(2) and corresponding provisions
of state securities laws, which exempts transactions by an issuer not involving any public offering. In each case, the issuances
were made, without any general solicitation or advertising, to a limited number of sophisticated investors with knowledge and experience
of financial and business matters related to an investment in the Company's securities. In addition, the securities issued
in the foregoing issuances were restricted securities bearing transfer restrictions and the recipients acquired such securities
for their own respective accounts without a view to resell or distribute them. Such securities may not be offered or sold in the
United States absent registration or an applicable exemption from the registration requirements and certificates evidencing such
shares contain a legend stating the same. Accordingly, the foregoing issuances are subject to the private placement exemption from
registration provided by Section 4(a)(2) of the Securities Act.
Item 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
See the Exhibit Index,
which follows the signature page and which is incorporated by reference herein.
Item 17. UNDERTAKINGS
The undersigned Registrant
hereby undertakes:
(1)
To file, during any period in which offers or sales are being made, a post-effective amendment
to this registration statement:
(i)
To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
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4
(ii)
To reflect in the prospectus any facts or events arising after the effective date of the registration
statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental
change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation
from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement;
and
(iii)
To include any material information with respect to the plan of distribution not previously disclosed
in the registration statement or any material change to such information in the registration statement.
(2)
That, for the purpose of determining any liability under the Securities Act of 1933, each such
post-effective amendment shall be deemed a new registration statement relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the initial
bona fide
offering thereof.
(3)
To remove from registration by means of a post-effective amendment any of the securities being
registered which remain unsold at the termination of the offering.
(4)
That, for purposes of determining liability under the Securities Act of 1933 to any purchaser,
each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration
statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included
in the registration statement as of the date it is first used after effectiveness.
Provided, however
, that no statement
made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or
deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will,
as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the
registration statement or prospectus that was part of the registration statement or made in any such document immediately prior
to such date of first use.
Insofar as indemnification
for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant
will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed
by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements
of the Securities Act of 1933, as amended, the Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-1 and has duly caused this Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the city of New York, State of New York, on September 18, 2017.
Ameri Holdings, Inc.
(Registrant)
By:
/s/ Giri Devanur
Name
Giri Devanur
Title:
Ameri Holdings, Inc.
(Principal Executive Officer)
By:
/s/ Viraj Patel
Name
Viraj Patel
Title:
Ameri Holdings, Inc.
(Principal Financial and Accounting Officer)
KNOW
ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below does hereby constitute and appoint jointly and severally,
Giri Devanur and Viraj Patel, or either of them, with full power of substitution and full power to act without the other, his or
her true and lawful attorney-in-fact and agent to act for him or her in his or her name, place and stead, in any and all capacities,
to sign any or all amendments thereto (including without limitation any post-effective amendments hereto), and any registration
statement for the same offering that is to be effective under Rule 462(b) of the Securities Act, and to file each of the same,
with all exhibits thereto, and other documents in connection therewith or herewith, with the Securities and Exchange Commission,
granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act
and thing requisite and necessary to be done in and about the premises in order to effectuate the same as fully, to all intents
and purposes, as they, he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or any of them, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements
of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the
dates indicated below.
Signature
Title
Date
/s/ Giri Devanur
President, Chief Executive Officer
September 18, 2017
Giri Devanur
and Director
(Principal Executive Officer)
/s/ Viraj Patel
Chief Financial Officer
September 18, 2017
Viraj Patel
(Principal Financial Officer and
Principal Accounting Officer)
/s/ Dimitrios J. Angelis
Director
September 18, 2017
Dimitrios J. Angelis
/s/ Venkatraman Balakrishnan
Director
September 18, 2017
Venkatraman Balakrishnan
/s/ Srinidhi Devanur
Director
September 18, 2017
Srinidhi Devanur
/s/ Jeffrey E. Eberwein
Director, Chairman
September 18, 2017
Jeffrey E. Eberwein
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/s/ Dr. Arthur M. Langer
Director
September 18, 2017
Dr. Arthur M. Langer
/s/ Robert G. Pearse
Director
September 18, 2017
Robert G. Pearse
/s/ Dhruwa N. Rai
Director
September 18, 2017
Dhruwa N. Rai
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EXHIBIT INDEX
Exhibit
Number
Description of
Exhibits
1.1++
Form of Underwriting Agreement.
2.1
Agreement of Merger and Plan of Reorganization, dated as of May 26, 2015, among Spatializer Audio Laboratories, Inc., Ameri100 Acquisition, Inc. and Ameri & Partners Inc. (filed as Exhibit 2.1 to AMERI Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on May 26, 2015 and incorporated herein by reference).
2.2
Stock Purchase Agreement by and between Ameri Holdings, Inc. and the shareholders of Ameri Consulting Service Private Limited. (filed as Exhibit 10.3 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
2.3
Share Purchase Agreement, dated as of November 20, 2015, by and among Ameri Holdings, Inc., Bellsoft, Inc., and all of the shareholders of Bellsoft (filed as Exhibit 2.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on November 23, 2015 and incorporated herein by reference).
2.4
Agreement of Merger and Plan of Reorganization, dated as of July 22, 2016, by and among Ameri Holdings, Inc., Virtuoso Acquisition Inc., Ameri100 Virtuoso Inc., Virtuoso, L.L.C. and the sole member of Virtuoso, L.L.C. (filed as Exhibit 2.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on July 27, 2016 and incorporated herein by reference).
2.5
Membership Interest Purchase Agreement, dated as of July 29, 2016, by and among Ameri Holdings, Inc., DC&M Partners, L.L.C., all of the members of DC&M Partners, L.L.C., Giri Devanur and Srinidhi "Dev" Devanur (filed as Exhibit 2.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on August 1, 2016 and incorporated herein by reference).
2.6
Share Purchase Agreement, dated as of March 10, 2017, by and among Ameri Holdings, Inc., ATCG Technology Solutions, Inc., all of the stockholders of ATCG Technology Solutions, Inc., and the stockholders' representative (filed as Exhibit 2.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on March 13, 2017 and incorporated herein by reference).
3.1
Amended and Restated Certificate of Incorporation of Ameri Holdings, Inc. (filed as Exhibit 3.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on June 23, 2016 and incorporated herein by reference).
3.2
Certificate of Designation of Rights and Preferences of 9.00% Series A Cumulative Preferred Stock (filed as Exhibit 3.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on January 4, 2017 and incorporated herein by reference).
3.3
Corrected Certificate of Designation of Rights and Preferences of 9.00% Series A Cumulative Preferred Stock (filed as Exhibit 3.3 to Ameri Holdings, Inc.'s Registration Statement on Form S-1, Amendment No. 1, filed with the SEC on April 18, 2017 and incorporated herein by reference).
3.4
Amended and Restated Bylaws of Ameri Holdings, Inc. (filed as Exhibit 3.2 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on June 23, 2016 and incorporated herein by reference).
4.1
Form of Certificate Representing Shares of Common Stock of Registrant (filed as Exhibit 4.1 to Ameri Holdings, Inc.'s Registration Statement on Form S-8 filed with the SEC on December 17, 2015 and incorporated herein by reference).
4.2
Form of Common Stock Purchase Warrant issued by Ameri Holdings, Inc. to Lone Star Value Investors, LP, dated May 26, 2015 (filed as Exhibit 4.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
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4.3
Common Stock Purchase Warrant, dated May 12, 2016, issued by Ameri Holdings, Inc. to Lone Star Value Investors, LP, dated May 12, 2016 (filed as Exhibit 4.3 to Ameri Holdings, Inc.'s Quarterly Report on Form 10-Q filed with the SEC on May 16, 2016 and incorporated herein by reference).
4.4
Amended and Restated Registration Rights Agreement, dated May 12, 2016, by and between Ameri Holdings, Inc. and Lone Star Value Investors, LP (filed as Exhibit 10.3 to Ameri Holdings, Inc.'s Quarterly Report on Form 10-Q filed with the SEC on May 16, 2016 and incorporated herein by reference).
4.5
Form of 8% Convertible Unsecured Promissory Note due March 2020 (filed as Exhibit 10.2 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on March 8, 2017 and incorporated herein by reference).
4.6
Form of Registration Rights Agreement for 2017 Notes Investors (filed as Exhibit 10.3 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on March 8, 2017 and incorporated herein by reference).
4.7
Form of 6% Unsecured Promissory Note (filed as Exhibit 10.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on March 13, 2017 and incorporated herein by reference).
5.1++
Opinion of Olshan Frome Wolosky LLP.
10.1
Securities Purchase Agreement, dated as of May 26, 2015, by and between Ameri Holdings, Inc. and Lone Star Value Investors, LP. (filed as Exhibit 10.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
10.2
Stock Purchase Agreement by and between Ameri Holdings, Inc. and the shareholders of Ameri Consulting Service Private Limited. (filed as Exhibit 10.3 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
10.3
Employment Agreement, dated as of May 26, 2015, between Giri Devanur and Ameri Holdings, Inc. (filed as Exhibit 10.4 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
10.4
Employment Agreement, dated as of May 26, 2015, between Srinidhi "Dev" Devanur and Ameri Holdings, Inc. (filed as Exhibit 10.5 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
10.5
Form of Indemnification Agreement. (filed as Exhibit 10.6 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
10.6
Form of Option Grant Letter. (filed as Exhibit 10.7 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
10.7*
2015 Equity Incentive Award Plan. (filed as Exhibit 10.8 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on June 1, 2015 and incorporated herein by reference).
10.8
Form of Restricted Stock Unit Agreement (filed as Exhibit 10.1 to Ameri Holdings, Inc.'s Quarterly Report on Form 10-Q filed with the SEC on November 23, 2015 and incorporated herein by reference).
10.9
Securities Purchase Agreement, dated as of April 20, 2016, by and between Ameri Holdings, Inc. and Dhruwa N. Rai (filed as Exhibit 10.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on April 21, 2016 and incorporated herein by reference).
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10.10
Loan and Security Agreement, dated as of July 1, 2016, by and among Ameri and Partners Inc, Bellsoft, Inc., Ameri Holdings, Inc., Linear Logics, Corp., Winhire Inc, Giri Devanur, the lenders which become a party to the Loan and Security Agreement, and Sterling National Bank, N.A. (a lender and as agent for the lenders) (filed as Exhibit 10.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on July 7, 2016 and incorporated herein by reference).
10.11
Exchange Agreement, dated as of December 30, 2016, between Ameri Holdings, Inc. and Lone Star Value Investors, LP (filed as Exhibit 10.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on January 4, 2017 and incorporated herein by reference).
10.12
Form of Securities Purchase Agreement for 2017 Notes Investors (filed as Exhibit 10.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on March 8, 2017 and incorporated herein by reference).
10.13
Employment Letter, dated April 24, 2016, between Ameri and Partners Inc and Viraj Patel (filed as Exhibit 10.1 to Ameri Holdings, Inc.'s Current Report on Form 8-K filed with the SEC on April 25, 2017 and incorporated herein by reference).
21.1+
List of Subsidiaries.
23.1+
Consent of Ram Associates.
23.2++
Consent of Olshan Frome Wolosky LLP (included in Exhibit 5.1)
24.1+
Power of Attorney.
#
101.INS
XBRL Instance Document.
#
101.SCH
XBRL Taxonomy Extension Schema Document.
#
101.CAL
XBRL Taxonomy Extension Calculation Linkbase Document.
#
101.DEF
XBRL Taxonomy Extension Definition Linkbase Document.
#
101.LAB
XBRL Taxonomy Extension Label Linkbase Document.
#
101.PRE
XBRL Taxonomy Extension Presentation Linkbase Document.
# Pursuant to Rule 406T of Regulation S-T,
this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or
12 of the Securities Act, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and
otherwise is not subject to liability under these sections.
* Includes compensatory plan or arrangement.
+ Filed herewith.
++ To be filed by amendment.
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