EFTA01912348.pdf

To: Jeffrey EMeevacationegmail.comi From: Richard Joslin Sent Sun 8/3/2014 3:01:28 PM Subject FW: Trends and Reconciliation to Tax Returns LOANS.odf Lacking general ledger and reviewing all the cash flows, it appears that some of the loans made in July were repaid in July — The attached is show the change in loans from June 30 to July 25. Per the Catherine at Artspace, the debt that is subject to 3X is $736K. The additional payables owed by Black trust were to be commissions. Not clear on what is to be paid on non-3x debt, but conversation with Catherine on conference call was only the 3x debt. Last, the payment of Pillsbury legal fees were prepayment for services (ie to cover sale negotiations) From: Richard Joslin Sent: Sunday, August 03, 2014 7:17 AM To: 'John Murphy; Eileen Alexanderson Subject: RE: Trends and Reconciliation to Tax Returns It appears there was a repayment in July of the July loans of $145K as well — not clear where the money came from this. Not scientific as I have not combed all bank statements. From: Richard Joslin Sent: Sunday, August 03, 2014 6:41 AM To: 'John Murphy; Eileen Alexanderson Subject: RE: Trends and Reconciliation to Tax Returns There are a smattering of bank statements on dropbox. An extract from the July Chase statement summarizes large inflows and outflows (pasted below) — not sure if readable on handheld. Capital Infusion by equityholders — Canaan, Vroom, Levene, Mott, Kramlich = $412K; payments to Pillsbury Winthrop $235k, Trinet $153K; Sparring Capital Partners $30K. Sparring appears to be M&A advice. CANAAN 116,666 IX CHRIS VROMM EFTA_R1_00349655 EFTA01912348  20,000 CHRIS VROOM 33,333 53,333 DANIEL LEVENE 10,000 DANIEL LEVENE 15,000 25,000 KRAMLICH 16,666 16,666 TIM MOTT 100,000 TIM MOTT 200,000 100,000 411,665 PILLSBURY WINTHROP 100,000 PI LLSBURY WINTHROP 135,000 235,000 TRINET 83,008 TRINET 3,378 TRINET 1,059 TRINET 15,022 TRINET 51,111 TRINET 153,970 392 EFTA_R1_00349656 EFTA01912349  SPARRING CAPITAL PTRS 30,000 30,000 418,970 From: John Murphy Sent: Friday, August 01, 2014 4:45 PM To: Richard Joslin; Eileen Alexanderson Subject: Trends and Reconciliation to Tax Returns Richard/Eileen, I have created a simple spreadsheet (ArtSpace Trends) that shows the major Income statements and Balance Sheet items by month. I will look at this to verify where the cash is going. In the meantime I also used this file to tie back the QB fmancials to the Tax Returns and highlight any differences. Note 2013 is based on accruals, while 2011 and 2012 was on a Cash basis. As I look at 2012 and 2013 the major differences are disallowable T&E for Tax purposes. Comparing the tax returns to the QB files this gives us a comfort level on the validity of the data. I will perform some substantial testing to verify salaries etc. (I will also question Catherine on some of the classification of 2011 expenses) I will keep you updated as I make progress. EFTA_R1_00349657 EFTA01912350 Regards, John. John Murphy COO/CFO Phaidon Press 65 Bleecker Street New York, NY 10012 phaidon.com EFTA_R1_00 349658 EFTA01912351