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EX-32.1 - CERTIFICATION OF CHIEF EXECUTIVE OFFICER - Ournett Holdings, Inc.ex32-1.htm
EX-31.1 - CERTIFICATION OF CHIEF EXECUTIVE OFFICER - Ournett Holdings, Inc.ex31-1.htm
EX-32.2 - CERTIFICATION OF CHIEF FINANCIAL OFFICER - Ournett Holdings, Inc.ex32-2.htm
EX-31.2 - CERTIFICATION OF CHIEF FINANCIAL OFFICER - Ournett Holdings, Inc.ex31-2.htm

 

 

U.S. SECURITIES AND EXCHANGE COMMISSION

 

Washington, D. C. 20549

 

FORM 10-Q/A
Amendment No. 1

 

(Mark One)

 

QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the fiscal quarter ended December 31, 2014
   
TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

 

For the transition period from ____________to____________

 

Commission file number 333-192415

 

OURNETT HOLDINGS, INC.

 

(Exact name of small business issuer as specified in its charter)

 

Nevada   333-192415   46-3545939
(State of Incorporation)   (Commission File Number)   (IRS Employer Identification No.)

 

122 East 42nd Street

New York, New York 10168

 (Address of principal executive offices) (Zip code)

 

Issuer’s telephone number: 212-986-1544

 

None

Securities registered under Section 12(g) of the Exchange Act:

 

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐    No

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☐    No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer Accelerated filer
Non-accelerated filer Smaller reporting company

 

 
 

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes    No

 

There were 42,662,440 shares outstanding of registrant’s common stock, par value $.00001 per share, as of July 20, 2015.

 

Prepared By:

 

 

Sunny J. Barkats, Esq.

JSBarkats, PLLC

18 East 41st Street, 14th Floor

New York, NY 10017

P: (646) 502-7001

F: (646) 607-5544

www.JSBarkats.com

 

 
 

 

Explanatory Note

The purpose of this Amendment No. 1 to Ournett Holdings, Inc. Quarterly Report on Form 10-Q for the quarterly period ended December 31, 2014 is to have our New Auditor (as defined below) re-perform the work of our Former Auditor (as defined below).

 

We are filing this Amendment No. 1 to reflect the re-performance of the work that is required for our stock to become eligible for quotation on the OTC Markets. Accordingly, investors should no longer rely upon the Company's previously reviewed financial statements for this period or any earnings releases or other communications relating to this period.

 

On May 19, 2015, we notified M&K CPAS, PLLC (the “Former Auditor”) that it has been dismissed for no cause as our independent registered public accounting firm effective as of the date of such notice. On May 19, 2015, we engaged MaloneBailey, LLP (“New Auditor”) as our independent registered public accounting firm for our fiscal year ending September 30, 2015. See the Company’s Current Report on Form 8-K, filed on May 22, 2015, for disclosure regarding our change in auditors.

 

No other changes have been made to the Form 10-Q. This Amendment No. 1 to the Form 10-Q speaks as of the original filing date of the Form 10-Q, does not reflect events that may have occurred subsequent to the original filing date, and does not modify or update in any way disclosures made in the original Form 10-Q.

 

Pursuant to Rule 12b-15 under the Securities Exchange Act of 1934, as amended, this Form 10-Q/A includes new certifications by our principal executive officer and principal financial officer under Sections 302 and 906 of the Sarbanes-Oxley Act of 2002. Except for the items noted above, no other information included in the Company’s original Form 10-Q is being amended by this Form 10-Q/A.

 

 
 

 

OURNETT HOLDINGS, INC.

 

TABLE OF CONTENTS

 

PART I. Financial Information  
     
Item 1. Condensed Consolidated Financial Statements (unaudited)  
  Condensed Consolidated Balance Sheets as of  December 31, 2014 and September 30, 2013 (unaudited) 1
  Condensed Consolidated Statements of Operations for the Three Months Ended December 31, 2014 and December 31, 2013 (unaudited) 2
  Condensed Consolidated Statement of Cash Flows for the Three Months Ended December 31, 2014 and December 31, 2013 (unaudited) 3
  Notes to Condensed Consolidated Financial Statements (unaudited) 4
Item 6. Exhibits. 11
  Signatures  

 

 
 

 

Ournett Holdings, Inc. and Subsidiary

Condensed Consolidated Balance Sheets 

ASSETS  December 31, 2014  September 30, 2014
   (Unaudited)   
Current Assets   
Cash  $448   $2,515 
Total  Assets  $448   $2,515 
           
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)          
           
Current Liabilities          
Accounts payable  $89,718   $68,429 
Accounts payable - related party   28,000    19,000 
Accrued interest   1,084    735 
Accrued interest - related party   89    45 
Total Current Liabilities  $118,891   $88,209 
Long Term Liabilities          
Note payable   141,521    141,521 
Note  payable - related party   11,896    11,896 
Total  Liabilities   272,308    241,626 
           
Commitments and Contingencies    —      —   
           
Stockholders' Equity (Deficit)          
Preferred stock,  $0.00001 par value; 10,000,000 shares authorized,   —      —   
none issued and outstanding          
Common stock, $0.00001 par value; 100,000,000 shares authorized,          
42,062,440 and 41,062,440 issued and outstanding December 31, 2014 and September 30, 2014, respectively   421    411 
Treasury stock, 1,000,000 shares   (20,000)   (20,000)
Additional paid-in capital   181,080    152,871 
Stock payable   12,500    25,000 
Accumulated Deficit   (445,861)   (397,393)
           
Total Stockholders' Equity(Deficit)   (271,860)   (239,111)
           
Total Liabilities and Stockholders' Equity(Deficit)  $448   $2,515 

 

 See accompanying notes to unaudited condensed consolidated financial statements

 

1
 

  

Ournett Holdings, Inc. and Subsidiary

Condensed Consolidated Statements of Operations

(Unaudited)

    

   Three Months Ended  Three Months Ended
   December 31, 2014  December 31, 2013
       
Revenue  $—     $—   
           
Cost of Revenue   —      —   
           
Gross Profit   —      —   
           
Operating Expenses          
General and Administrative   48,856    77,407 
Total Operating Expenses   48,856    77,407 
           
Loss from Operations   (44,856)   (77,407)
           
Other Expenses          
Interest Expense, net   (3,612)   (155)
           
LOSS FROM OPERATIONS BEFORE INCOME TAXES   (48,468)   (77,562)
           
Provision for Income Taxes   —      —   
           
NET LOSS  $(48,468)  $(77,562)
           
Net Loss Per Share  - Basic and Diluted  $(0.00)  $(0.00)
           
Weighted average number of shares outstanding          
  during the period - Basic and Diluted   42,562,440    39,146,500 
           
           

 

See accompanying notes to condensed unaudited consolidated financial statements 

 

2
 

 

Ournett Holdings, Inc. and Subsidiary

 Condensed Consolidated Statement of Cash Flows

(Unaudited)

 

   For The Three Months  For The Three Months
   December 31, 2014  December 31, 2013
Cash Flows Used In Operating Activities:      
Net Loss  $(48,468)  $(77,562)
  Adjustments to reconcile net loss to net cash used in operations          
    In-kind contribution of interest   3,219    —   
  Changes in operating assets and liabilities:          
      Increase in accounts payable   21,289    15,596 
      Increase in accrued expenses   349    155 
      Increase in accrued expenses - related party   9,044    —   
      Increase/(Decrease) in prepaid expenses   —      3,000 
Net Cash Used In Operating Activities   (14,567)   (58,811)
           
           
Cash Flows From Financing Activities:          
Proceeds from issuance of common stock   12,500    —   
Cash collected from subscription receivable   —      241 
Net Cash Provided by Financing Activities   12,500    241 
           
Net (Decrease)/Increase in Cash   (2,067)   (58,570)
           
Cash at Beginning of Year/Period   2,515    87,071 
           
Cash at End of Year/Period  $448   $28,501 
           
Supplemental disclosure of cash flow information:          
           
Cash paid for interest  $—     $—   
Cash paid for taxes  $—     $—   
           
Supplemental disclosure of non-cash investing and financing activities:          
           
Stock issued in exchange for subscription receivable  $—     $—   

 

See accompanying notes to condensed unaudited consolidated financial statements 

 

3
 

 

OURNETT HOLDINGS, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014

(UNAUDITED)

  

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES AND ORGANIZATION 

 

(A) Organization

 

Ournett Holdings, Inc. was incorporated under the laws of the State of Nevada on August 26, 2013. Ournett, Inc., a wholly owned subsidiary, was incorporated under the laws of the State of New York also on August 26, 2013. Collectively, Ournett Holdings, Inc. and Ournett, Inc. make up the consolidated company (the “Company”) as of August 26, 2013 (date of Inception).

 

The Company was formed to develop a local e-commerce marketplace that connects merchants to consumers through its bloggers by offering goods and services at a discount.

 

The Company’s success will depend on continued employment of the existing executive officers and directors for the development of the Company’s platform. Such experience will be important to the establishment of the business. The loss of these individuals during this early development stage could disrupt and negatively affect the business and operations. The success also depends on having highly trained technical and customer support personnel.

 

(B) Basis of Presentation

 

The accompanying unaudited condensed financial statements of the Company, have been prepared in accordance with the rules and regulations (S-X) of the Securities and Exchange Commission (the “SEC”) and with the instructions to Form 10-Q. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

 

In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. The results from operations for the three months ended December 31, 2014 are not necessarily indicative of the results that may be expected for the year ended September 30, 2015. The unaudited condensed financial statements should be read in conjunction with the September 30, 2014 financial statements and footnotes thereto included in the Company’s Registration Statement included in Form 10k filed on March 31, 2015.

 

(C) Going Concern

 

The activities of the Company have been principally devoted to developing the business plan and raising capital. The Company has not generated any revenue, has incurred expenses and has sustained losses to date. Consequently its operations are subject to all risks inherent in the establishment of a new business enterprise. As reflected in the accompanying condensed financial statements for the three months ended December 31, 2014, the Company used cash in operations of $14,567 and has a net loss of $48,468. These factors among others may indicate that the Company will be unable to continue as a going concern for a reasonable period of time.

 

The Company’s existence is dependent upon management’s ability to develop profitable operations and to obtain additional funding sources. There can be no assurance that the Company’s financing efforts will result in profitable operations or the resolution of the Company’s liquidity problems. The accompanying statements do not include any adjustments that might result should the Company be unable to continue as a going concern.

 

(C) Principles of Consolidation

 

The accompanying 2014 consolidated financial statements include the accounts of Ournett Holdings, Inc. and its wholly owned subsidiary, Ournett, Inc. All intercompany accounts have been eliminated upon consolidation.

 

(D) Use of Estimates

 

In preparing the consolidated financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and revenues and expenses during the reported period. Significant estimates include valuation of deferred tax assets. Actual results could differ from those estimates.

 

4
 

OURNETT HOLDINGS, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014

(UNAUDITED)

  

(E) Cash and Cash Equivalents

 

The Company considers all highly liquid temporary cash investments with an original maturity of three months or less to be cash equivalents. At December 31, 2014 and September 30, 2014, respectively, the Company had no cash equivalents.

 

(F) Loss Per Share

 

Basic and diluted net loss per common share is computed based upon the weighted average common shares outstanding as defined by the Financial Accounting Standards Board (FASB) ASC No. 260, “Earnings Per Share.” As of December 31, 2014 and 2013 there were no common share equivalents outstanding.

 

(G) Income Taxes

 

The Company accounts for income taxes under FASB Codification Topic 740-10-25 (“ASC 740-10-25”). Under ASC 740-10-25, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740-10-25, the effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

 

(H) Business Segments

 

The Company operates in one segment and therefore segment information is not presented.

 

(I) Revenue Recognition

 

The Company will recognize revenue on arrangements in accordance with FASB ASC No. 605, “Revenue Recognition”. In all cases, revenue will be recognized only when the price is fixed and determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured.

 

(J) Recent Accounting Pronouncements

 

In June 2014, FASB issued Accounting Standards Update (“ASU”) No. 2014-10, “Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation”. The update removes all incremental financial reporting requirements from GAAP for development stage entities, including the removal of Topic 915 from the FASB Accounting Standards Codification. In addition, the update adds an example disclosure in Risks and Uncertainties (Topic 275) to illustrate one way that an entity that has not begun planned principal operations could provide information about the risks and uncertainties related to the company’s current activities. Furthermore, the update removes an exception provided to development stage entities in Consolidations (Topic 810) for determining whether an entity is a variable interest entity-which may change the consolidation analysis, consolidation decision, and disclosure requirements for a company that has an interest in a company in the development stage. The update is effective for the annual reporting periods beginning after December 15, 2014, including interim periods therein. Early application with the first annual reporting period or interim period for which the entity’s financial statements have not yet been issued (Public business entities) or made available for issuance (other entities). The Company has elected early adoption of these amendments.

 

In June 2014, FASB issued Accounting Standards Update (“ASU”) No. 2014-12, “Compensation - Stock Compensation (Topic 718); Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved after the Requisite Service Period”. The amendments in this ASU apply to all reporting entities that grant their employees share-based payments in which the terms of the award provide that a performance target that affects vesting could be achieved after the requisite service period. The amendments require that a performance target that affects vesting and that could be achieved after the requisite service period be treated as a performance condition. A reporting entity should apply existing guidance in Topic 718 as it relates to awards with performance conditions that affect vesting to account for such awards. For all entities, the amendments in this ASU are effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. Entities may apply the amendments in this ASU either (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. If retrospective transition is adopted, the cumulative effect of applying this Update as of the beginning of the earliest annual period presented in the financial statements should be recognized as an adjustment to the opening retained earnings balance at that date. Additionally, if retrospective transition is adopted, an entity may use hindsight in measuring and recognizing the compensation cost. This updated guidance is not expected to have a material impact on our results of operations, cash flows or financial condition. We are currently reviewing the provisions of this ASU to determine if there will be any impact on our results of operations, cash flows or financial condition.

 

5
 

   

OURNETT HOLDINGS, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014

(UNAUDITED)

  

In August 2014, the FASB issued Accounting Standards Update “ASU” 2014-15 on “Presentation of Financial Statements Going Concern (Subtopic 205-40) - Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern”. Currently, there is no guidance in U.S. GAAP about management’s responsibility to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern or to provide related footnote disclosures. The amendments in this Update provide that guidance. In doing so, the amendments are intended to reduce diversity in the timing and content of footnote disclosures. The amendments require management to assess an entity’s ability to continue as a going concern by incorporating and expanding upon certain principles that are currently in U.S. auditing standards. Specifically, the amendments (1) provide a definition of the term substantial doubt, (2) require an evaluation every reporting period including interim periods, (3) provide principles for considering the mitigating effect of management’s plans, (4) require certain disclosures when substantial doubt is alleviated as a result of consideration of management’s plans, (5) require an express statement and other disclosures when substantial doubt is not alleviated, and (6) require an assessment for a period of one year after the date that the financial statements are issued (or available to be issued). We are currently reviewing the provisions of this ASU to determine if there will be any impact on our results of operations, cash flows or financial condition.

 

All other newly issued accounting pronouncements but not yet effective have been deemed either immaterial or not applicable.

 

(K) Reclassification

 

We have reclassified certain prior period amounts to conform to the current period presentation. These reclassifications have no effect on the financial position or on the results of operations or cash flows for the periods presented.

 

(L) Fair Value of Financial Instruments

 

We hold certain financial assets, which are required to be measured at fair value on a recurring basis in accordance with the Statement of Financial Accounting Standard No. 157, ”Fair Value Measurements” (“ASC Topic 820-10”). ASC Topic 820-10 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). ASC Topic 820-10 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. Level 1 instruments include cash, account receivable, prepaid expenses, inventory and account payable and accrued liabilities. The carrying values are assumed to approximate the fair value due to the short term nature of the instrument.

 

The three levels of the fair value hierarchy under ASC Topic 820-10 are described below:

 

6
 

 

OURNETT HOLDINGS, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014

(UNAUDITED)

  

Level 1 - Valuations based on quoted prices in active markets for identical assets or liabilities that an entity has the ability to access. We believe our carrying value of level 1 instruments approximate their fair value at December 31, 2014 and September 30, 2014.
   
Level 2 - Valuations based on quoted prices for similar assets or liabilities, quoted prices for identical assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable data for substantially the full term of the assets or liabilities.
   
Level 3 - Valuations based on inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. We consider depleting assets, asset retirement obligations and net profit interest liability to be Level 3. We determine the fair value of Level 3 assets and liabilities utilizing various inputs, including NYMEX price quotations and contract terms.

 

      December 31,
2014
    September 30,
2014
 
 Level 1         
 Level 2         
 Level 3         
 Total         

 

NOTE 2   NOTES PAYABLE - RELATED PARTY

 

On June 3, 2014 the Company executed an unsecured, interest bearing promissory note, due on June 3, 2024 promissory note payable to its stockholder in the amount of $10,000. Pursuant to the terms of the note, the loans are interest bearing at 1% per year, on the outstanding balance, due on the maturity date. As of December 31, 2014 and September 30, 2014, the Company accrued interest in the amount of $65 and $32, respectively, and recorded $207 as an in kind contribution of interest. 

 

On September 19, 2013 the Company executed an unsecured, interest bearing promissory note, due on September 18, 2023, payable to its stockholder in the amount of $1,896. Pursuant to the terms of the note, the loan is interest bearing at 1% per year, on the outstanding balance, due on the maturity date. As of December 31, 2014 and September 30, 2014, the Company accrued interest in the amount of $24 and $20, respectively, and recorded $41, as an in kind contribution of interest (See Note 5).

 

NOTE 3    NOTES PAYABLE

 

On September 8, 2014 the Company executed an unsecured, interest bearing promissory note, due on August 4, 2024 promissory note payable to an unrelated party in the amount of $50,000 . Pursuant to the terms of the note, the loans are interest bearing at 1% per year, on the outstanding balance, due on the maturity date. The holder of the note has an option to convert the note into 2,000,000 shares of the Company’s common stock. For the year ended September 30, 2014, the loan balance remains outstanding. As of December 31, 2014, the Company accrued interest in the amount of $155 and recorded $1,012, as an in-kind contribution of interest. For convertible debt, the convertible feature indicated a rate of conversion that was not below market value. As a result, the Company did not record a “beneficial conversion feature” (“BCF”) and related debt discount. 

 

On August 4, 2014 the Company executed an unsecured, interest bearing promissory note, due on August 4, 2024 promissory note payable to an unrelated party in the amount of $25,000 . Pursuant to the terms of the note, the loans are interest bearing at 1% per year, on the outstanding balance, due on the maturity date. The holder of the note has an option to convert the note into 1,000,000 shares of the Company’s common stock. For the year ended September 30, 2014, the loan balance remains outstanding. As of December 31, 2014, the Company accrued interest in the amount of $102 and recorded $510, as an in-kind contribution of interest. For convertible debt, the convertible feature indicated a rate of conversion that was not below market value. As a result, the Company did not record a “beneficial conversion feature” (“BCF”) and related debt discount. 

 

On September 19, 2013 the Company executed an unsecured, interest bearing promissory note, due on September 18, 2023, payable to its stockholder in the amount of $23,024. Pursuant to the terms of the note, the loan is interest bearing at 1% per year, on the outstanding balance, due on the maturity date. As of December 31, 2014 and 2013, the Company accrued interest in the amount of $296 and $65, respectively, and recorded $503, as an in-kind contribution of interest.

 

7
 

 

OURNETT HOLDINGS, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014

(UNAUDITED)

  

On September 19, 2013 the Company executed an unsecured, interest bearing promissory note, due on September 18, 2023, payable to its stockholder in the amount of $24,980. Pursuant to the terms of the note, the loan is interest bearing at 1% per year, on the outstanding balance, due on the maturity date. On March 6, 2014 the Company executed an unsecured, interest bearing promissory note, due on March 6, 2024, payable to the same stockholder in the amount of $6,425. Pursuant to the terms of these notes, the loans are interest bearing at 1% per year, on the outstanding balance, due on the maturity date. As of December 31, 2014, the Company accrued interest for both notes in the amount of $374 and record $681 as in-kind contribution of interest. As of September 30, 2013, the Company accrued interest on one of the notes in the amount of $70.

 

On September 19, 2013 the Company executed an unsecured, interest bearing promissory note, due on September 18, 2023, payable to its stockholder in the amount of $12,092. Pursuant to the terms of the note, the loan is interest bearing at 1% per year, on the outstanding balance, due on the maturity date. As of December 31, 2014 and 2013, the Company accrued interest in the amount of $155 and $34, respectively, and recorded $264, as an in-kind contribution of interest.

 

NOTE 4 STOCKHOLDERS’ EQUITY

 

(A) Common Stock Issued for Cash

 

On November 3, 2014, the Company entered into a subscription agreement for the purchase of 500,000 shares at $0.025/share for cash at fair value of $12,500. The purchase price of $12,500 has been received by the Company, however, the investor agreed orally to defer the receipt of the shares purchased until after the Company receives its ticker symbol from FINRA.

 

For the year ended September 30, 2014, the Company issued 1,178,440 shares of its common stock at a purchase price of $0.025 per share, which were valued at $29,461. The Company also issued 287,500 shares of its common stock at a purchase price of $0.014 per share, which were valued at $4,025.

 

(B) Stock Issued for Services and Interest

 

For the year ended September 30, 2014, the Company issued 450,000 shares of common stock in exchange for consulting services valued at $6,300 ($0.014/share) based upon the recent third party cash offering price, representing the best evidence of fair value.

 

On September 17, 2014 the Company issued 1,000,000 shares of common shares in exchange for legal services valued at $25,000 ($0.025/share), based upon the recent third party cash offering price, representing the best evidence of fair value. The shares were validly authorized for issuance, however, the stock transfer agent issued the shares on October 31, 2014. (See Note 6)

 

For the three months ended December 31, 2014, the Company recorded $3,219 as an in kind contribution of interest.

 

For the year ended September 30, 2014, the Company recorded $5,312 as an in kind contribution of interest.

 

(C) Preferred Stock

 

The Company was incorporated on August 26, 2013. The Company is authorized to issue 10,000,000 shares of preferred stock with a par value of $0.00001 per share. Preferred stock may be issued in one or more series. As of September 30, 2014, no preferred shares are issued and outstanding. Rights and preferences are to be determined by the board of directors.

  

 

8
 

 

OURNETT HOLDINGS, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014

(UNAUDITED)

  

NOTE 5 RELATED PARTY TRANSACTIONS

 

 

On September 22, 2014 Miguel Sebastia, the Company’s officer and Director resigned. For the services rendered the director will receive the following compensation:

 

  Immediate payment upon execution of this Agreement in the amount of $20,000. Simultaneously, Director shall return his 4,500,000 shares for no consideration. On February 9, 2015, Mr. Sebastia returned 1,000,000 shares to the Company (See Note 7).
     
  Payment in the amount of $70,000 within three months of the date of execution of this Agreement
     
  In the event the Company does not timely pay the Director the $70,000 balance due, then 3,500,000 of the shares he owns shall be returned.

 

For the year ended September 30, 2014 the Company paid $20,000 to Mr. Sebastia. On February 9, 2014 the Company amended the agreement and agreed to pay Mr. Sebastia a total $90,000 in exchange for 4,500,000 shares of its common stock by December 22, 2014 of which $20,000 was previously paid. However, since no additional payment was made to Mr. Sebastia, he will keep the 3,500,000 in stock and the Company has until March 24, 2015 to pay the $70,000 for his 3,500,000 shares. The Company recorded $20,000 as a repurchase of treasury stock.

 

Our executive, administrative, and operating offices are located at 122 East 42nd Street, Suite 620, New York, New York 10168. We lease this space from Fernando Koatz, the President, director, and shareholder at no cost.

 

Amounts payable to a law firm owned by our Chief Financial Officer were $28,000 and $19,000 as of December 31, 2014 and September 30, 2014, respectively.

 

NOTE 6 COMMITMENTS

 

On September 17, 2014, the Company entered into a consulting agreement to receive professional services. The Company is required to pay $2,800 per month and issue 1,000,000 shares upon the execution of the agreement. In addition, the Company will pay a fee of $15,000 for additional professional fees of which $5,000 is due upon the execution of the agreement and $10,000 payable on a monthly basis at $2,000 per month starting October 1, 2014. Additionally, on the first anniversary date of the agreement an additional 1,000,000 shares will be issued. Upon issuance shares are fully vested and non-forfeitable. For the year ended September 30, 2014, the Company’s issued 1,000,000 shares in exchange for professional services valued at $25,000 ($0.025/share), based upon the recent third party cash offering price, representing the best evidence of fair value. The shares were validly authorized for issuance, however, the stock transfer agent issued the shares on October 31, 2014. On February 16, 2015 the Company entered into an addendum to the original agreement and will issue an additional 1,500,000 shares and $15,000 (See Note 7).

 

NOTE 7 SUBSEQUENT EVENTS

  

On February 26, 2015, the Company issued 50,000 shares of common stock in exchange for consulting services valued at $125 ($0.025/share) based upon the recent third party cash offering price, representing the best evidence of fair value.

 

On February 26, 2015, the Company issued 50,000 shares of common stock in exchange for accounts payable valued at $125 ($0.025/share) based upon the recent third party cash offering price, representing the best evidence of fair value.

 

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OURNETT HOLDINGS, INC. AND SUBSIDIARY

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

AS OF DECEMBER 31, 2014

(UNAUDITED)

 

On February 16, 2015, the Company issued 1,500,000 shares of common stock in exchange for processional services valued at $37,500 ($0.025/share) based upon the recent third party cash offering price, representing the best evidence of fair value. (See Note 6).

 

On March 12, 2015, the Company issued a convertible note in the principal amount of $25,000 to an investor. This convertible note matures on March 11, 2025. Starting September 9, 2015, and provide the Company’s common stock is eligible for quotation on the OTC QB Market or the OTC Pink, this convertible note may be converted into shares of the Company’s common stock at a conversion price of $0.05. For convertible debt, the convertible feature indicated a rate of conversion that was not below market value. As a result, the Company did not record a “beneficial conversion feature” (“BCF”) and related debt discount. In connection with the note, the Company entered into a compensation agreement, where the Company will issue 2,000,000 shares of common stock to a consultant as a finder’s fee compensation service valued at $50,000 ($0.025/share) based upon the recent third party cash offering price, representing the best evidence of fair value.

 

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Item 6. Exhibits

 

Exhibit No.   Description
31.1   Certification of Chief Executive Officer under Rule 13(a) — 14(a) of the Exchange Act.
31.2   Certification of Chief Financial Officer under Rule 13(a) — 14(a) of the Exchange Act.
32.1   Certification of the CEO under 18 U.S.C. Section 1350
32.2    Certification of the CFO under 18 U.S.C. Section 1350
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

 


 

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SIGNATURES

 

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, there unto duly authorized on this 30th day of July, 2015.

 

  OURNETT HOLDINGS, INC.  
       
  By: /s/ Xavier Rey  
    Xavier Rey  
   

Chief Executive Officer

(Principal Executive Officer)

 
       
  By: /s/ Fernando Koatz  
   

Fernando Koatz, President

Chief Financial Officer

(Principal Financial and Accounting Officer)

 

 

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