On December 7, 2006, the Company entered into a Limited Assets Purchase Agreement by and among the Company, SysteamUS, Inc. and Systeam Italy SpA, whereby the Company acquired certain intellectual property associated with SysteamUS' security software for $5,850,000. Concurrently with the purchase, the Company discontinued its Merchandise Distribution Business and changed its focus to providing homeland security, data retention and tracking software and services to law enforcement agencies, telecommunications companies and Internet service providers.
On December 11, 2006, the Company effected a 20-for-1 forward stock split of its common stock, each having a par value of $0.0001 per share. All share and per share amounts have been retroactively restated to reflect this split.
On December 15, 2006, the Company amended its articles of incorporation to change its name from Merchandise Creations, Inc. to Intelligentias, Inc. In accordance with Statement of Financial Accounting Standards ("SFAS") No. 144 "Accounting for the Impairment or Disposal of Long-Lived Assets", the operating results and assets and liabilities related to the Merchandise Distribution Business have been reflected as discontinued operations in the accompanying financial statements. Unless otherwise noted, amounts in these notes to the financial statements excluded amounts attributable to discontinued operations.
