MyGO Games Holding Co. - FORM 10-K

Attached files

file	filename
EX-31 - RULE 13A-14(A) CERTIFICATION - MyGO Games Holding Co.	ex_31-1.htm
EX-32 - CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350 - MyGO Games Holding Co.	ex_32-1.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

FORM 10-K


x	ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the fiscal year ended August 31, 2012


¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the transition period from __________, 20__, to __________, 20__

Commission File Number

333-166064

OBJ Enterprises, Inc.

(formerly Obscene Jeans Corp.)

(Exact Name of Registrant as Specified in its Charter)

Florida

27-1070374

(State or Other Jurisdiction of

Incorporation or Organization)

(I.R.S. Employer

Identification Number)

677 N. Washington Blvd. Sarasota, Florida 34236

(Address of Principal Executive Offices)

(941) 952-5825

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(g) of the Act: $.0001 par value common stock

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 x No o

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 (Section 232.405) during the preceding 12 months. Yes o No x

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x

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. (Check one):


Large accelerated filer o	Accelerated filer o

Non-accelerated filer o (Do not check if a smaller reporting company)	Smaller reporting company x

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

The Aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter, February 29, 2012 was $1,045,000.

There were 7,027,500 shares of the Registrant’s $0.0001 par value common stock outstanding as of December 12, 2012.

OBJ ENTERPRISES, INC.

FORM 10-K INDEX


Part I		3

Item 1.	Description of Business	3
Item 1A.	Risk Factors	5
Item 1B.	Unresolved Staff Comments	5
Item 2.	Description of Property	5
Item 3.	Legal Proceedings	5
Item 4.	Mine Safety Disclosures	5

Part II		5

Item 5.	Market for Common Equity and Related Stockholder Matters	5
Item 6.	Selected Financial Data	6
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	7
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	10
Item 8.	Financial Statements and Supplementary Data	10
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	23
Item 9A.	Controls and Procedures	23
Item 9B.	Other information	23

Part III		24

Item 10.	Directors, Executive Officers and Corporate Governance	24
Item 11.	Executive Compensation	25
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	26
Item 13.	Certain Relationships and Related Transactions, and Director Independence	26
Item 14.	Principal Accountant Fees and Services	27

Part IV		27

Item 15.	Exhibits and Financial Statement Schedules	27

Signatures		28
Certifications

OBJ ENTERPRISES, INC.

This Annual Report on Form 10-K and the documents incorporated herein by reference contain forward-looking statements that have been made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on current expectations, estimates and projections about OBJ Enterprises, Inc. industry, management beliefs, and assumptions made by management. Words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” variations of such words and similar expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict; therefore, actual results and outcomes may differ materially from what is expressed or forecasted in any such forward-looking statements.

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PART I


ITEM 1.	DESCRIPTION OF BUSINESS

OVERVIEW

We are a development stage company and were incorporated in the State of Florida on September 21, 2009, as a for-profit company, with an established fiscal year end of August 31. The original intent of the Company was to design a woman’s line of jeans branded as “Obscene Brand Jeans” internally and enter into outsourcing agreements for the manufacturing, marketing, selling and distributing agreements with independent agents, each of whom is to be granted exclusive rights to market and sell “Obscene Brand Jeans” in its respective territory. The intent was to include a line of complimentary t-shirts, jackets and sweatshirts to accent the base of our intended collection.

On June 27, 2012, the Company changed its name to OBJ Enterprises, Inc.

On November 10, 2011, the Company formed Obscene Interactive, LLC, a wholly-owned subsidiary. Obscene Interactive was established to identify emerging trends and companies within the social media space for the purpose of acquisitions, joint ventures and global licensing of technology platforms and algorithms. As of the date of this filing, Obscene Interactive has no assets or liabilities; however, it is in the final stages of negotiating a funding arrangement for an early stage gaming company based in California, and has other online and mobile games to launch within the next quarter.

On November 2, 2011, our former Chief Executive Officer, Rachel Stark-Cappelli, resigned all positions with the Company. As a result of Ms. Stark-Cappelli’s resignation, the Company is reviewing its jeans and apparel business. The Company established a subsidiary to pursue opportunities in the social networking and media sector. As a result of the Company’s review of its jeans and apparel business, the Company may decide to cease the jeans and apparel business and concentrate on its social networking business. Alternatively, the Company could pursue both opportunities simultaneously and use the Company’s social networking business as a marketing platform for its jeans and apparel. During the period of review, the Company continues to pursue both opportunities.

On May 9, 2012, we entered into a joint venture agreement (the “Joint Venture Agreement”) with Source Street, LLC, a Texas limited liability company (“Source Street”). The purpose of the joint venture is to fund the planning, development and launch of online and mobile games across social platforms for fun, educational and corporate training purposes. We will contribute the working capital for the joint venture and Source Street will contribute its knowledge and development skills to complete the design and launch of online and mobile games. We paid $5,000 to the joint venture upon signing the agreement and will make weekly payments of $1,500 for the term of the joint venture. We will share profits and losses of the joint venture equally with Source Street.

On July 9, 2012, we revised the Joint Venture Agreement (the “Revised Joint Venture Agreement”) with Source Street. Under the terms of the Revised Joint Venture Agreement, we are required to provide oversight and management toward the development of online and social games. Source Street will identify and coordinate the development team. We will provide funding for the joint venture in the amount of $2,500 per week during the period of development of the first game. Ownership of the game and profits and losses will be split 80% to OBJE and 20% to Source Street. The Revised Joint Venture Agreement can be terminated by a 30-day notice from either party.

We have not generated any revenues to date and our activities have been limited to developing our business plan. We will not have the necessary capital to develop our business plan until we are able to secure additional financing.

There can be no assurance that such financing will be available on suitable terms.

We have no revenues; have incurred losses since inception, have been issued a going concern opinion from our auditors and rely upon the sale of our securities to fund operations.

As of August 31, 2012, we had $2,652 cash on hand. We believe that this cash will satisfy our operating requirements for less than one month.

Business Strategy

Our original strategy was to build brand recognition by marketing our products to fashion conscious, affluent consumers who shop in high-end boutiques and department stores and who want to wear and be seen in the latest, trendiest, jeans. However, under new management, OBJE has taken on a new industry vertical outside of fashion jeans

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Our revised strategy involves increased focus on the social media and marketing industry through acquiring, developing and publishing online and social games. In addition to our joint venture agreement with Source Street, OBJE plans to leverage the explosive growth in online and social media markets to deliver games to consumers to play with any online portal. We plan to launch the first series of games through our independent developer, Novalon Games, which was established under the joint venture between OBJE and Source Street.

Sales and Marketing Strategy

The world of video games is currently in a state of major transition. Traditional consoles games for Xbox, Playstation and Nintendo are losing market share to games designed to be played on smartphones, tablets and even Facebook. These are the gaming platforms of the future, and the transition represents a major growth opportunity for OBJE.

OBJE is currently designing fun, engaging, and highly customizable new games monetized using the free-to-play (FTP) model. These games will feature exciting bonus items made available via micro-transactions. The FTP model has already generated millions of dollars in revenue for our competitors and carries the promise of incredible returns for investors.

With the help of our joint venture partners, Source Street LLC, OBJE has created an in-house game development studio, Novalon Games. Novalon’s flagship product offering, the multiplayer online role-playing game Wayfarers, is currently in development and is scheduled to be made available for play on Facebook in 2013. But Wayfarers is just a start. OBJE plans to capture a significant share of the muti-billion-dollar online and mobile gaming market with a wide variety of fun and immersive new games to be developed and released over the next few years; ranging from i0S, Android to social media and gaming platforms..

Products

The initial product offering from Novalon Games, our in-house game developer, will be social games played on applications such as Apple, and Android operating systems. The flagship product, Wayfarers, is a free-to-play MMORPG featuring tantalizing in-game purchases of customized weapons, armor, and other accessories and will be released alongside of other games targeting smart phones utilizing Apple and Android operating systems and social networking platforms. Many more games are scheduled to follow, designed to replicate and surpass the billion-dollar success of our competitors in the industry.

Market

Gartner forecasts this dynamic market’s revenue to reach $28 billion by 2015, growing at a CAGR of 24 percent. Much of the revenue in this sector will be driven by online and social games, forecast to reach $4 billion by 2014.

Experts forecast that the global video game market will grow to a value of $82 billion over the next five years. Much of that growth will be driven by the online and mobile game market, forecast to rise in value to $35 billion by 2017.

COMPETITION

The runaway success of game developer Zynga is proof that the free-to-play model for social games pays. In five short years, the company has risen from a startup to a leader in the gaming industry thanks to Facebook hits like FarmVille. In 2012, the company grew to more than 300 million active monthly users and earned profits between $152-162 million.

By delivering better-designed and more immersive games, OBJE could be poised to duplicate or even surpass Zynga’s success by targeting digital content and social delivery networks.

EMPLOYEES AND EMPLOYMENT AGREEMENTS

As of August 31, 2012, we have no employees other than Paul Watson, our sole officer and director. Mr. Watson has the flexibility to work on our business up to 10 to 25 hours per week. He is prepared to devote more time to our operations as may be required and we do not have any employment agreements with him.

We do not presently have, pension, health, annuity, insurance, stock options, profit sharing, or similar benefit plans; however, we may adopt plans in the future. There are presently no personal benefits available to our sole director and officer.

During the initial implementation of our marketing strategy, we intend to hire independent consultants to develop and execute our business plan.

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ITEM 1A.	RISK FACTORS

As a smaller reporting company, we are not required to provide the information required by this Item.


ITEM 1B.	UNRESOLVED STAFF COMMENTS

None.


ITEM 2.	DESCRIPTION OF PROPERTY

We maintain our statutory registered agent’s office at 677 N. Washington Blvd., Sarasota, FL 34236 and our business office is located at 677 N. Washington Blvd., Sarasota, FL 34236. Tel: (941) 952-5825.


ITEM 3.	LEGAL PROCEEDINGS

We know of no material, active or pending legal proceedings against us, nor are we involved as a plaintiff in any material proceedings or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered beneficial shareholder are an adverse party or has a material interest adverse to us.


ITEM 4.	MINE SAFETY DISCLOSURES

None.

PART II


ITEM 5.	MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

MARKET INFORMATION

Our common stock began trading on the “Over the Counter” Bulletin Board (“OTC”) under the symbol “OBJE” in January 2011. The following table sets forth, for the period indicated, the prices of the common stock in the over-the-counter market, as reported and summarized by OTC Markets Group, Inc. These quotations represent inter-dealer quotations, without adjustment for retail markup, markdown or commission and may not represent actual transactions. There is an absence of an established trading market for the Company’s common stock, as the market is limited, sporadic and highly volatile, which may affect the prices listed below.


	High		Low
Fiscal Year Ended August 31, 2012
Quarter ended August 31, 2012	$	2.20	$	1.08
Quarter ended May 31, 2012	$	7.80	$	1.80
Quarter ended February 29, 2012	$	11.40	$	1.36
Quarter ended November 30, 2011	$	31.20	$	6.80

Fiscal Year Ended August 31, 2011
Quarter ended August 31, 2011	$	108.00	$	24.00
Quarter ended May 31, 2011	$	120.00	$	74.00
Quarter ended February 28, 2011	$	120.00	$	70.00

HOLDERS

As of the date of this filing, there were four holders of record of our common stock.

DIVIDENDS

To date, we have not paid dividends on shares of our common stock and we do not expect to declare or pay dividends on shares of our common stock in the foreseeable future. The payment of any dividends will depend upon our future earnings, if any, our financial condition, and other factors deemed relevant by our Board of Directors.

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COMMON STOCK

We are authorized to issue 100,000,000 shares of common stock, with a par value of $0.0001. The closing price of our common stock on December 11, 2012, as quoted by the OTC, was $0.98. There were 7,027,500 shares of common stock issued and outstanding as of December 11, 2012. All shares of common stock have one vote per share on all matters including election of directors, without provision for cumulative voting. The common stock is not redeemable and has no conversion or preemptive rights. The common stock currently outstanding is validly issued, fully paid and non- assessable. In the event of liquidation of the Company, the holders of common stock will share equally in any balance of the Company’s assets available for distribution to them after satisfaction of creditors and preferred shareholders, if any. The holders of common stock of the Company are entitled to equal dividends and distributions per share with respect to the common stock when, as and if, declared by the Board of Directors from funds legally available.

On November 13, 2012, the Company effected a one-for-40 reverse stock split.

During the year ended August 31, 2012, there was no modification of any instruments defining the rights of holders of the Company’s common stock and no limitation or qualification of the rights evidenced by the Company’s common stock as a result of the issuance of any other class of securities or the modification thereof.

PREFERRED STOCK

We are authorized to issue 10,000,000 shares of preferred stock with a par value of $0.0001. No shares of preferred stock have been issued. If preferred stock were issued, the terms and conditions would be determined by the Board of Directors.

SECURITIES AUTHORIZED FOR ISSUANCE UNDER EQUITY COMPENSATION PLANS

The following table shows the number of shares of common stock that could be issued upon exercise of outstanding options and warrants, the weighted average exercise price of the outstanding options and warrants, and the remaining shares available for future issuance as of August 31, 2012.


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

Equity compensation plans approved by security holders	—	—	—

Equity compensation plans not approved by security holders	—	—	—

Total	—	—	—


ITEM 6.	SELECTED FINANCIAL DATA

As a smaller reporting company, we are not required to provide the information required by this Item.

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ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

THIS FILING CONTAINS FORWARD-LOOKING STATEMENTS. THE WORDS “ANTICIPATED,” “BELIEVE,” “EXPECT,” “PLAN,” “INTEND,” “SEEK,” “ESTIMATE,” “PROJECT,” “WILL,” “COULD,” “MAY,” AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING STATEMENTS. THESE STATEMENTS INCLUDE, AMONG OTHERS, INFORMATION REGARDING FUTURE OPERATIONS, FUTURE CAPITAL EXPENDITURES, AND FUTURE NET CASH FLOW. SUCH STATEMENTS REFLECT THE COMPANY’S CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND FINANCIAL PERFORMANCE AND INVOLVE RISKS AND UNCERTAINTIES, INCLUDING, WITHOUT LIMITATION, GENERAL ECONOMIC AND BUSINESS CONDITIONS, CHANGES IN FOREIGN, POLITICAL, SOCIAL, AND ECONOMIC CONDITIONS, REGULATORY INITIATIVES AND COMPLIANCE WITH GOVERNMENTAL REGULATIONS, THE ABILITY TO ACHIEVE FURTHER MARKET PENETRATION AND ADDITIONAL CUSTOMERS, AND VARIOUS OTHER MATTERS, MANY OF WHICH ARE BEYOND THE COMPANY’S CONTROL. SHOULD ONE OR MORE OF THESE RISKS OR UNCERTAINTIES OCCUR, OR SHOULD UNDERLYING ASSUMPTIONS PROVE TO BE INCORRECT, ACTUAL RESULTS MAY VARY MATERIALLY AND ADVERSELY FROM THOSE ANTICIPATED, BELIEVED, ESTIMATED, OR OTHERWISE INDICATED. CONSEQUENTLY, ALL OF THE FORWARD-LOOKING STATEMENTS MADE IN THIS FILING ARE QUALIFIED BY THESE CAUTIONARY STATEMENTS AND THERE CAN BE NO ASSURANCE OF THE ACTUAL RESULTS OR DEVELOPMENTS.

The following discussion and analysis of our financial condition and plan of operations should be read in conjunction with our financial statements and related notes appearing elsewhere herein. This discussion and analysis contains forward-looking statements including information about possible or assumed results of our financial conditions, operations, plans, objectives and performance that involve risk, uncertainties and assumptions. The actual results may differ materially from those anticipated in such forward-looking statements. For example, when we indicate that we expect to increase our product sales and potentially establish additional license relationships, these are forward-looking statements. The words expect, anticipate, estimate or similar expressions are also used to indicate forward-looking statements.

Background of our company

We are a development-stage company, incorporated in the State of Florida on September 21, 2009, as a for-profit company, and an established fiscal year of August 31. We have not yet generated or realized any revenues from business operations. Our auditor has issued a going concerned opinion. This means there is substantial doubt that we can continue as an on-going business for the next eighteen (18) months unless we obtain additional capital to pay our bills. Accordingly, we must raise cash from sources other than loans we undertake.

From inception through our current date, August 31, 2012, our business operations have primarily been focused on developing our business plan and design collection sketches, design collection sketches, specifications, researching contractors, sales agents, distributors and website designers. We have not generated any revenue from business operations.

Plan of Operations

We do not have adequate funds to satisfy our working capital requirements for the next twelve months. We will need to raise additional capital to continue our operations. We anticipate needing a minimum of $120,000 for our business plan which includes the development of Game One. Currently available cash is not sufficient to allow us to commence full execution of our business plan. Our business expansion will require significant capital resources that may be funded through the issuance of common stock or of notes payable or other debt arrangements that may affect our debt structure. Despite our current financial status, we believe that we may be able to issue notes payable or debt instruments in order to start executing our business plan. However, there can be no assurance that we will be able to raise money in this fashion and have not entered into any agreements that would obligate a third party to provide us with capital.

If we are unable to raise additional funds we will not be able to implement our business plan. Due to the fact that many of the milestones are dependent on each other, if we do not raise any additional capital we will not be able to implement any facets of our business plan.

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We intend to pursue capital through public or private financing as well as borrowings and other sources, such as our officer and director in order to finance our businesses activities. We cannot guarantee that additional funding will be available on favorable terms, if at all. If adequate funds are not available, then our ability to continue our operations may be significantly hindered.

We have not yet begun the development of any of our anticipated products and even if we do secure adequate financing, there can be no assurance that our products will be accepted by the marketplace and that we will be able to generate revenues.

Our management does not plan to hire any employees at this time. Our sole officer and director will be responsible for implementing our business plan. We intend to hire independent consultants and sales representatives to carry out sales, marketing and distribution activities.

RESULTS OF OPERATIONS AND GOING CONCERN

We incurred a net loss of $886,997 for the year ended August 31, 2012, and had a working capital deficit of $308,774 as of August 31, 2012. We do not anticipate having positive net income in the immediate future. Net cash used by operations for the year ended August 31, 2012 was $322,889. These conditions create an uncertainty as to our ability to continue as a going concern.

We continue to rely on advances to fund operating shortfalls and do not foresee a change in this situation in the immediate future. There can be no assurance that we will continue to have such advances available. We will not be able to continue operations without them. We are pursuing alternate sources of financing, but there is no assurance that additional capital will be available to the Company when needed or on acceptable terms.

We have not generated any revenues from our operations. We cannot guarantee we will be successful in our business operations. Our business is subject to risks inherent in the establishment of a new business enterprise, including the financial risks associated with the limited capital resources currently available to us for the implementation of our business strategies. To become profitable and competitive, we must develop the business and marketing plan and execute the plan. Our management will attempt to secure financing through various means including borrowing and investment from institutions and private individuals.

Since inception, the majority of our time has been spent refining our business plan and beginning development of our first game.

Results of Operations for the year ended August 31, 2012 compared to the year ended August 31, 2011

General and Administrative Expenses

General and administrative expenses decreased in the year ended August 31, 2012 as compared to the year ended August 31, 2011 from $1,267,017 to $608,038. Included in general and administrative expense for the years ended August 31, 2012 and 2011 is common stock issued for services in the amount of $315,000 and $620,000, respectively. Excluding these amounts, general and administrative expenses for the years ended August 31, 2012 and 2011 would have been $293,038 and $647,017, respectively. The remaining decrease in general and administrative expense is related to management’s efforts to control costs.

Loss from Operations

The decrease in our operating loss for the year ended August 31, 2012 as compared to the comparable period of 2011 from $1,267,017 to $608,038 is due to the decrease in general and administrative expenses described above.

Interest expense

We incurred interest expense of $278,959 for the year ended August 31, 2012. There was no interest expense in the comparable period of 2011. Interest expense relates to convertible notes payable signed during the year. There were no such notes during the year ended August 31, 2011. Included in interest expense for the year ended August 31, 2012 is amortization of a discount on the note in the amount of $236,547.

Net Income (Loss)

We recognized a net loss of $886,997 for the year ended August 31, 2012 as compared to a loss of $1,267,017 for the same period of 2011. The decrease in net loss is attributable to the decrease in general and administrative expense partially offset by the increase in interest expense.

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LIQUIDITY AND CAPITAL RESOURCES

As of the date of this filing, we had yet to generate any revenues from our business operations.

We anticipate needing approximately $120,000 to fund our operations and to effectively execute our business plan over the next eighteen months. Currently available cash is not sufficient to allow us to commence full execution of our business plan. Our business expansion will require significant capital resources that may be funded through the issuance of common stock or of notes payable or other debt arrangements that may affect our debt structure. Despite our current financial status we believe that we may be able to issue notes payable or debt instruments in order to start executing our business plan. However, there can be no assurance that we will be able to raise money in this fashion and we have not entered into any agreements that would obligate a third party to provide us with capital.

Through August 31, 2012, we have incurred cumulative losses since inception of $2,174,586. We raised the cash amounts to be used in these activities from the sale of common stock and from working capital advances. We currently have negative working capital of $308,774.

As of August 31, 2012 we had $2,652 of cash on hand. This amount of cash will be adequate to fund our operations for less than one month.

As of the date of this filing, the current funds available to the Company may not be sufficient to continue maintaining its reporting status with the SEC. Management believes if the Company cannot maintain its reporting status with the SEC it will have to cease all business activity. As such, any investment previously made would be lost in its entirety.

To date the Company has been able to fund operations through the sale of stock and by obtaining cash advances. The Company will have to seek additional financing in the future. However, the Company may not be able to obtain additional capital or generate sufficient revenues to fund our operations. If we are unsuccessful at raising sufficient funds, for whatever reason, to fund our operations, the Company may be forced to seek a buyer for our business or another entity with which we could create a joint venture. If all of these alternatives fail, we expect that the Company will be required to seek protection from creditors under applicable bankruptcy laws.

Our independent auditor has expressed substantial doubt about our ability to continue as a going concern and believes that our ability is dependent on our ability to implement our business plan, raise capital and generate revenues. See Note 2 of our financial statements.

INFLATION

The effect of inflation on our revenues and operating results has not been significant.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

Critical Accounting Policies and Estimates

Our financial statements are affected by the accounting policies used and the estimates and assumptions made by management during their preparation. A complete listing of these policies is included in Note 3 of the notes to our financial statements for the year ended August 31, 2012. We have identified below the accounting policies that are of particular importance in the presentation of our financial position, results of operations and cash flows, and which require the application of significant judgment by management.

USE OF ESTIMATES - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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.

RESEARCH AND DEVELOPMENT EXPENSES - Expenditures for research, development, and engineering of products will be expensed as incurred.

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EARNINGS (LOSS) PER SHARE - Basic loss per share is computed by dividing net loss attributable to common stockholders by the weighted average common shares outstanding for the period. Diluted loss per share is computed giving effect to all potentially dilutive common shares. Potentially dilutive common shares may consist of incremental shares issuable upon the exercise of stock options and warrants and the conversion of notes payable to common stock. In periods in which a net loss has been incurred, all potentially dilutive common shares are considered antidilutive and thus are excluded from the calculation. At August 31, 2012 the Company did not have any potentially dilutive common shares.

New Accounting Pronouncements

For a description of recent accounting standards, including the expected dates of adoption and estimated effects, if any, on our financial statements, see “Note 3: Significant Accounting Polices: Recent Accounting Standards” in Part II, Item 8 of this Form 10-K.


ITEM 7A.	Quantitative and Qualitative Disclosures About Market Risk

Not applicable.


ITEM 8.	Financial Statements

OBJ Enterprises, Inc.

(formerly Obscene Jeans Corp.)

(A Development Stage Enterprise)

Financial Statements

August 31, 2012

Contents


Report of Independent Registered Public Accounting Firm	11

Financial Statements:

Balance Sheets	12
Statements of Operations	13
Statements of Changes in Stockholders’ Deficit	14
Statements of Cash Flows	15
Notes to Financial Statements	16

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Peter Messineo

Certified Public Accountant

1982 Otter Way Palm Harbor FL 34685

peter@pm-cpa.com

T 727.421.6268 F 727.674.0511

To the Board of Directors and Shareholders:

OBJ Enterprises, Inc.

I have audited the balance sheet of OBJ Enterprises, Inc. as of August 31, 2012 and 2011 and the related statement of operations, changes in stockholder’s equity, and cash flows for the years ended August 31, 2012 and 2011, and for the period September 21, 2009 (date of inception) through August 31, 2012. These financial statements are the responsibility of the Company’s management. My responsibility was to express an opinion on these financial statements based on my audit.

I conducted my audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that I plan and perform the audits to obtain reasonable assurance about whether the financial statements were free of material misstatement. The Company was not required to have, nor was I engaged to perform, an audit of its internal control over financial reporting. My audit included consideration of internal control over financial reporting as a basis for designing audit procedures that were 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, I express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audit provide a reasonable basis for my opinion.

In my opinion, the financial statements, referred to above, present fairly, in all material respects, the financial position of OBJ Enterprises, Inc. as of August 31, 2012 and 2011, and the results of its operations and its cash flows for the years ended August 31, 2012 and 2011, and for the period September 21, 2009 (date of inception) through August 31, 2012, in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As discussed in Note 2 to the financial statements, the Company has no revenues from operation, has not emerged from the development stage, and is requiring traditional financing or equity funding to commence its operating plan. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. Further information and management’s plans in regard to this uncertainty were also described in Note 2. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ Peter Messineo, CPA

Peter Messineo, CPA

Palm Harbor, Florida

December 18, 2012

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OBJ Enterprises, Inc.

(formerly Obscene Jeans Corp.)

(A Development Stage Corporation)

Balance Sheets


	August 31,
	2012			2011
Assets
Current assets:
Cash	$	2,652		$	45,169
Prepaid expenses		—			2,086

Total current assets		2,652			47,255

TOTAL ASSETS	$	2,652		$	47,255

Liabilities and Stockholders’ Deficit
Current liabilities:
Accounts payable	$	31,054		$	62,991
Advances payable		280,372			590,353

Total current liabilities		311,426			653,344

Stockholders’ deficit:
Preferred stock; $0.0001 par value; 10,000,000 shares authorized; 0 shares issued and outstanding.		—			—
Common stock; $0.0001 par value; 100,000,000 shares authorized; 607,500 and 337,500 shares issued and outstanding at August 31, 2012 and 2011, respectively		61			34
Additional paid in capital		1,675,205			681,466
Deficit accumulated during development stage		(2,174,586	)		(1,287,589	)

Total stockholders’ deficit		(499,320	)		(606,089	)

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	2,652		$	47,255

On November 13, 2012, the Company effected a one-for-40 reverse stock split. All share and per share amounts have been retroactively restated to reflect the reverse split.

The accompanying notes are an integral part of the financial statements

- 12 -

OBJ Enterprises, Inc.

(formerly Obscene Jeans Corp.)

(A Development Stage Corporation)

Statement of Operations


	Year Ended August 31,						Period from September 21, 2009 (date of inception) through August 31,
	2012			2011			2012

OPERATING EXPENSE:
General and administrative	$	608,038		$	1,267,017		$	1,895,627

LOSS FROM OPERATIONS		(608,038	)		(1,267,017	)		(1,895,627	)

Other income (expense), net
Interest expense		(278,959	)		—			(278,959	)

NET LOSS	$	(886,997	)	$	(1,267,017	)	$	(2,174,586	)

Net loss per common share (basic and fully diluted)	$	(1.69	)	$	(3.99	)

Weighted average number of common shares outstanding - basic and fully diluted		525,779			317,774

The accompanying notes are an integral part of the financial statements.

- 13 -

OBJ Enterprises, Inc.

(formerly Obscene Jeans Corp.)

(A Development Stage Corporation)

Statement of Changes in Stockholders’ Deficit

For the Period from September 21, 2009 (Date of Inception) through August 31, 2012


	Common Stock			Capital in Excess of		Accumulated
	Shares	Amount		Par Value		Deficit			Total

Balance, September 21, 2009, Date of Inception	—	$	—	$	—	$	—		$	—
Issuance of common stock for cash, September 2009, $0.04 per share	225,000		23		8,977		—			9,000
Issuance of common stock for cash, August 2010, $0.70 per share	75,000		8		52,492		—			52,500
Net loss for the period	—		—		—		(20,572	)		(20,572	)
Balance, August 31, 2010	300,000	$	31	$	61,469	$	(20,572	)	$	40,928

Issuance of common stock for services:
- December 2010	25,000		2		49,998		—			50,000
- August 2011	12,500		1		569,999		—			570,000
Net loss	—		—		—		(1,267,017	)		(1,267,017	)

Balance, August 31, 2011	337,500	$	34	$	681,466	$	(1,287,589	)	$	(606,089	)

Issuance of common stock for:
- Services	22,500		2		314,998		—			315,000
- Conversion of debt	247,500		25		241,828		—			241,853
Discount on convertible notes payable	—		—		436,913		—			436,913
Net loss for the period	—		—		—		(886,997	)		(886,997	)

Balance, August 31, 2012	607,500	$	61	$	1,675,205	$	(2,174,586	)	$	(499,320	)

On November 13, 2012, the Company effected a one-for-40 reverse stock split. All share and per share amounts have been retroactively restated to reflect the reverse split.

The accompanying notes are an integral part of the financial statements

- 14 -

OBJ Enterprises, Inc.

(formerly Obscene Jeans Corp.)

(A Development Stage Corporation)

Statement of Cash Flows


	Year Ended August 31,						Period from September 21, 2009 (date of inception) through August 31,
	2012			2011			2012
Operating activities
Net loss	$	(886,997	)	$	(1,267,017	)	$	(2,174,586	)
Adjustments to reconcile net loss to net cash used by operating activities:
Common stock issued for services		315,000			620,000			935,000
Amortization of discount on convertible note payable		236,547			—			236,547
Changes in operating assets and liabilities:
Prepaid expenses		2,086			7,081			—
Accounts payable and accrued liabilities		(31,937	)		52,991			31,054
Accrued interest payable		42,412			—			42,412
Net cash used by operating activities		(322,889	)		(586,945	)		(929,573	)

Investing activities
Net cash used by investing activities		—			—			—

Financing activities
Proceeds from advances		280,372			590,353			870,725
Proceeds from issuance of common stock		—			—			61,500
Net cash provided by financing activities		280,372			590,353			932,225

Net (decrease) increase in cash		(42,517	)		3,408			2,652

Cash at beginning of period		45,169			41,761			—

Cash at end of period	$	2,652		$	45,169		$	2,652



Supplemental disclosures of cash flow information and non cash investing and financing activities:
Cash paid for interest	$	—		$	—		$	—
Cash paid for taxes	$	—		$	—		$	—

Noncash investing and financing transactions:
Common stock issued for services	$	315,000		$	50,000		$	935,000
Common stock issued for conversion of debt	$	241,853		$	—		$	241,853

The accompanying notes are an integral part of the financial statements.

- 15 -

OBJ Enterprises, Inc.

(formerly Obscene Jeans Corp.)

(A Development Stage Corporation)

Notes to Financial Statements

August 31, 2012

1. BACKGROUND INFORMATION

OBJ Enterprises, Inc. (the “Company”), a Florida corporation, was formed to design, develop, wholesale, market distribute and sell a woman’s line of “Obscene Brand Jeans.” The Company also will include a line of complimentary t-shirts, jackets and sweatshirts to accent the base of the intended collection. The Company was incorporated on September 21, 2009 (Date of Inception) with its corporate headquarters located in Sarasota, Florida and its year-end is August 31.

On November 10, 2011, the Company formed Obscene Interactive, LLC (“Obscene Interactive”), a wholly-owned subsidiary to pursue emerging opportunities in the online and social gaming industry. Obscene Interactive has begun identifying potential acquisition targets in the social media industry and engaged Street Source, LLC on May 9, 2012 to develop a game for the Company through a joint venture agreement. See Note 4.

2. GOING CONCERN

For the year ended August 31, 2012, the Company had a net loss of $886,997 and negative cash flow from operations of $322,889. As of August 31, 2012, the Company has negative working capital of $308,774. The Company has not emerged from the development stage.

These factors raise a substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classifications of liabilities that may result from the possible inability of the Company to continue as a going concern.

The Company does not have the resources at this time to repay its credit and debt obligations, make any payments in the form of dividends to its shareholders or fully implement its business plan. Without additional capital, the Company will not be able to remain in business.

Management has plans to address the Company’s financial situation as follows:

In the near term, management plans to continue to focus on raising the funds necessary to fully implement the Company’s business plan. Management will continue to seek out debt financing to obtain the capital required to meet the Company’s financial obligations. There is no assurance, however, that lenders will continue to advance capital to the Company or that the new business operations will be profitable. The possibility of failure in obtaining additional funding and the potential inability to achieve profitability raise doubts about the Company’s ability to continue as a going concern.

In the long term, management believes that the Company’s projects and initiatives will be successful and will provide cash flow to the Company which will be used to finance the Company’s future growth. However, there can be no assurances that the Company’s planned activities will be successful, or that the Company will ultimately attain profitability. The Company’s long term viability depends on its ability to obtain adequate sources of debt or equity funding to meet current commitments and fund the continuation of its business operations, and the ability of the Company to ultimately achieve adequate profitability and cash flows from operations to sustain its operations.

3. SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies followed are:

FASB Codification - In June 2009, the FASB issued ASC 105, Generally Accepted Accounting Principles, effective for interim and annual reporting periods ending after September 15, 2009. This statement establishes the Codification as the source of authoritative accounting principles used in the preparation of financial statements in conformity with generally accepted accounting principles. The Codification does not replace or affect guidance issued by the SEC or its staff. As a result of the Codification, the references to authoritative accounting pronouncements included herein in this Annual Report on Form 10-K now refer to the Codification topic section rather than a specific accounting rule as was past practice.

- 16 -

OBJ Enterprises, Inc.

(formerly Obscene Jeans Corp.)

(A Development Stage Corporation)

Notes to Financial Statements

August 31, 2012

Use of estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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.

Cash and cash equivalents - All cash, other than held in escrow, is maintained with a major financial institution in the United States. Deposits with this bank may exceed the amount of insurance provided on such deposits. Temporary cash investments with an original maturity of three months or less are considered to be cash equivalents.

Research and development expenses - Expenditures for research and development of products are expensed as incurred. There have been no research and development costs incurred for the period ended August 31, 2012.

Common stock - The Company records common stock issuances when all of the legal requirements for the issuance of such common stock have been satisfied.

Revenue recognition - The Company has no current source of revenue, therefore, the Company has not yet adopted any policy regarding the recognition of revenues or related cost of goods.

Advertising Costs - The Company’s policy regarding advertising is to expense advertising costs as incurred. There have been no advertising costs incurred for the period ended August 31, 2012.

Income Taxes - Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes resulting from temporary differences. Such temporary differences result from differences in the carrying value of assets and liabilities for tax and financial reporting purposes. The deferred tax assets and liabilities represent the future tax consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

The Company adopted the provisions of FASB ASC 740-10 “Uncertainty in Income Taxes” (ASC 740-10), on January 1, 2007. The Company has not recognized a liability as a result of the implementation of ASC 740-10. A reconciliation of the beginning and ending amount of unrecognized tax benefits has not been provided since there is no unrecognized benefit since the date of adoption. The Company has not recognized interest expense or penalties as a result of the implementation of ASC 740-10. If there were an unrecognized tax benefit, the Company would recognize interest accrued related to unrecognized tax benefits in interest expense and penalties in operating expenses.

Earnings (Loss) Per Share - Basic loss per share is computed by dividing net loss attributable to common stockholders by the weighted average common shares outstanding for the period. Diluted loss per share is computed giving effect to all potentially dilutive common shares. Potentially dilutive common shares may consist of incremental shares issuable upon the exercise of stock options and warrants and the conversion of notes payable to common stock. In periods in which a net loss has been incurred, all potentially dilutive common shares are considered antidilutive and thus are excluded from the calculation. At August 31, 2012, the Company did not have any potentially dilutive common shares.

On November 13, 2012, the Company effected a one-for-40 reverse stock split. All share and per share amounts have been retroactively restated to reflect the reverse split. This presentation is consistent with the guidance in ASC 260-10-55-12, Earnings Per Share, which requires retroactive restatement of earnings per share if a capital structure change due to a stock dividend, stock split or reverse split occurs after the date of the latest balance sheet, but before the release of the financial statements or the effective date of the registration statement, whichever is later.

- 17 -

OBJ Enterprises, Inc.

(formerly Obscene Jeans Corp.)

(A Development Stage Corporation)

Notes to Financial Statements

August 31, 2012

Financial instruments - In September 2006, the Financial Accounting Standards Board (FASB) introduced a framework for measuring fair value and expanded required disclosure about fair value measurements of assets and liabilities. The Company adopted the standard for those financial assets and liabilities as of the beginning of the 2009 fiscal year and the impact of adoption was not significant. FASB Accounting Standards Codification (ASC) 820 “Fair Value Measurements and Disclosures” (ASC 820) defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy that distinguishes between (1) market participant assumptions developed based on market data obtained from independent sources (observable inputs) and (2) an entity’s own assumptions about market participant assumptions developed based on the best information available in the circumstances (unobservable inputs). The fair value hierarchy consists of three broad levels, which gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). The three levels of the fair value hierarchy are described below:


	·	Level 1 - Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.

	·	Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability (e.g., interest rates); and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

	·	Level 3 - Inputs that are both significant to the fair value measurement and unobservable.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of August 31, 2012. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values due to the short-term nature of these instruments. These financial instruments include accounts receivable, other current assets, accounts payable, accrued compensation and accrued expenses. The fair value of the Company’s notes payable is estimated based on current rates that would be available for debt of similar terms which is not significantly different from its stated value.

On September 21, 2009, the Company applied ASC 820 for all non-financial assets and liabilities measured at fair value on a non-recurring basis. The adoption of ASC 820 for non-financial assets and liabilities did not have a significant impact on the Company’s financial statements.

Recent Accounting Pronouncements

In April 2010, the FASB issued ASU No. 2010-13, Compensation-Stock Compensation (Topic 718)-Effect of Denominating the Exercise Price of a Share-Based Payment Award in the Currency of the Market in Which the Underlying Equity Security Trades - a consensus of the FASB Emerging Issues Task Force. The amendments in this Update are effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2010. Earlier application is permitted. The Company adopted ASU No. 2010-13 on September 1, 2011. The adoption did not have a material impact on the financial statements.

In May 2011, the FASB issued ASU No. 2011-04, Fair Value Measurement (Topic 820) - Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs (“ASU 2011-04”), which clarifies the wording and disclosures required in Accounting Standards Codification (“ASC”) Topic 820, Fair Value Measurement (“ASC 820”), to converge with those used (to be used) in International Financial Reporting Standards (“IFRS”). The update explains how to measure and disclose fair value under ASC 820. However, the FASB does not expect the changes in this standards update to alter the current application of the requirements in ASC 820. The provisions of ASU 2011-04 are effective for public entities prospectively for interim and annual periods beginning after December 15, 2011. Early adoption is prohibited. Therefore, ASU 2011-04 was effective for the Company beginning March 1, 2012. The adoption did not have a material impact on the financial statements.

- 18 -

OBJ Enterprises, Inc.

(formerly Obscene Jeans Corp.)

(A Development Stage Corporation)

Notes to Financial Statements

August 31, 2012

In June 2011, the FASB issued ASU No. 2011-05, Comprehensive Income (Topic 220) - Presentation of Comprehensive Income (“ASU 2011-05”). ASU 2011-05 changes the presentation of comprehensive income in the financial statements for all periods reported and eliminates the option under the current guidance that allows for presentation of other comprehensive income as part of the Statement of Stockholders’ Equity. The update proposes two options for the proper presentation of comprehensive income: 1) a single Statement of Comprehensive Income, which includes all components of net income and other comprehensive income; or 2) a Statement of Income followed immediately by a Statement of Comprehensive Income, which includes the summarized net income and all components of other comprehensive income. The provisions of ASU 2011-05 are effective for public entities retrospectively for annual periods, and interim periods within those years, beginning after December 15, 2011, with early adoption permitted. Therefore, ASU 2011-05 is effective for the Company on September 1, 2012. Although the provisions of this update could change the presentation of the financial statements of the Company, no material impact is expected on the Company’s results of operations, financial condition, and cash flows.

Other recent accounting pronouncements issued are not believed by management to have a material impact on the Company’s present or future financial statements.

4. RELATED PARTY TRANSACTIONS

In September 2009, the Company sold 225,000 shares of common stock to Rachel Stark-Cappelli, its founder and former sole director, for $0.001 per share. On December 19, 2010, Ms. Stark-Cappelli sold the 225,000 shares of common stock to Kern Capital Corp, a Marshall Islands Corporation.

The officers and directors of the Company are involved in other business activities and may, in the future, become involved in other business opportunities that become available. They may face a conflict in selecting between the Company and other business interests. The Company has not formulated a policy for the resolution of such conflicts.

The above terms and amounts are not necessarily indicative of the terms and amounts that would have been incurred had comparable transactions been entered into with independent parties.

5. ADVANCES FROM THIRD PARTIES

During the years ended August 31, 2012 and 2011, the Company received net, non-interest bearing advances from certain third parties totaling $280,372 and $590,353, respectively. The total amount due under these advances as of August 31, 2012 was $280,372. These advances are not collateralized and are due on demand.

On September 26, 2011, the Company agreed with the lender to refinance a portion of these advances in the amount of $78,885 into a convertible promissory note. See Note 6.

On February 14, 2012, the Company agreed with the lender to refinance a portion of these advances in the amount of $511,468 into a convertible promissory note. See Note 6.

6. CONVERTIBLE NOTES PAYABLE

On September 26, 2011, the Company signed a Convertible Promissory Note which refinanced non-interest bearing advances in the amount of $78,885 into a convertible note payable. The Convertible Promissory Note bears interest at 10% per annum and is payable along with accrued interest on February 28, 2013. The Convertible Promissory Note is convertible into common stock at the option of the holder at the rate of $0.01 per share.

- 19 -

OBJ Enterprises, Inc.

(formerly Obscene Jeans Corp.)

(A Development Stage Corporation)

Notes to Financial Statements

August 31, 2012

The Company evaluated the terms of this note in accordance with ASC Topic No. 815 – 40, Derivatives and Hedging - Contracts in Entity’s Own Stock and determined that the underlying common stock is indexed to the Company’s common stock. The Company determined that the conversion feature did not meet the definition of a liability and therefore did not bifurcate the conversion feature and account for it as a separate derivative liability. The Company evaluated the conversion feature for a beneficial conversion feature. The effective conversion price was compared to the market price on the date of the notes and was deemed to be less than the market value of underlying common stock at the inception of the note. Therefore, the Company recognized a beneficial conversion feature in the amount of $78,885 on September 26, 2011. The beneficial conversion feature was recognized as an increase in additional paid-in capital and a discount to the Convertible Note Payable. The discount to the Convertible Note Payable is being amortized to interest expense over the life of the note.

On September 27, 2011, the holder of the Convertible Note Payable elected to convert principal in the amount of $6,000 into 600,000 shares of common stock. On that date, the unamortized discount related to this principal was $6,000. The net amount of $- was recognized as an increase in stockholders’ equity as a result of this conversion.

On October 20, 2011, the holder of the Convertible Note Payable elected to convert principal in the amount of $45,000 into 4,500,000 shares of common stock. On that date, the unamortized discount related to this principal was $43,147. The net amount of $1,853 was recognized as an increase in stockholders’ equity as a result of this conversion.

On February 14, 2011, the Company signed a Convertible Promissory Note which refinanced non-interest bearing advances in the amount of $511,468 into a convertible note payable with an effective date of August 31, 2011. The Convertible Promissory Note bears interest at 10% per annum and is payable along with accrued interest on August 31, 2013. The Convertible Promissory Note is convertible into common stock at the option of the holder at the rate of $0.05 per share.

On March 5, 2012, the holder of the Convertible Note Payable in the original principal amount of $511,468 elected to convert principal in the amount of $240,000 into 4,800,000 shares of common stock. On that date, the unamortized discount related to this principal was $147,326. This amount was amortized to interest expense on the date of conversion.

The Company evaluated the terms of this note in accordance with ASC Topic No. 815 – 40, Derivatives and Hedging - Contracts in Entity’s Own Stock and determined that the underlying common stock is indexed to the Company’s common stock. The Company determined that the conversion feature did not meet the definition of a liability and therefore did not bifurcate the conversion feature and account for it as a separate derivative liability. The Company evaluated the conversion feature for a beneficial conversion feature. The effective conversion price was compared to the market price on the date of the notes and was deemed to be less than the market value of underlying common stock at the inception of the note. Therefore, the Company recognized a beneficial conversion feature in the amount of $358,028 on February 14, 2012. The beneficial conversion feature was recognized as an increase in additional paid-in capital and a discount to the Convertible Note Payable. The discount to the Convertible Note Payable is being amortized to interest expense over the life of the note.

The Company evaluated the application of ASC 470-50-40/55, Debtor’s Accounting for a Modification or Exchange of Debt Instrument as it applies to the two notes listed above and concluded that the revised terms constituted a debt modification rather than a debt extinguishment because the present value of the cash flow under the terms of each of the new instruments was less than 10% from the present value of the remaining cash flows under the terms of the original notes. No gain or loss on the modifications was required to be recognized.

The Company accrued interest in the amount of $34,867 during the nine months ended May 31, 2012. This amount was unpaid as of May 31, 2012 and is included in convertible notes payable as of that date. During the nine months ended May 31, 2012, discount on convertible notes payable in the amount of $213,751 was amortized to interest expense.

- 20 -

OBJ Enterprises, Inc.

(formerly Obscene Jeans Corp.)

(A Development Stage Corporation)

Notes to Financial Statements

August 31, 2012

7. INCOME TAXES

There are no current or deferred income tax expense or benefit for the period ended August 31, 2012.

The provision for income taxes is different from that which would be obtained by applying the statutory federal income tax rate to income before income taxes. The items causing this difference are as follows:


	Year ended August 31, 2012			Year ended August 31, 2011

Tax benefit at U.S. statutory rate	$	248,000		$	355,000
Permanent differences – stock compensation		(88,000	)		(174,000)
Valuation allowance		(160,000	)		(181,000)
	$	—		$	—

The Company has net operating loss carryforwards of $1,240,000 which will begin expiring in 2026.

8. PREFERRED STOCK

The Company’s Board of Directors has authorized 10,000,000 million shares of preferred stock with a par value of $0.0001 to be issued in series with terms and conditions to be determined by the Board of Directors.

9. COMMON STOCK

On November 13, 2012, the Company effected a one-for-40 reverse stock split. All share and per share amounts have been retroactively restated to reflect the reverse split.

On December 20, 2010, the Company issued 25,000 shares of common stock to Kern Capital Corp. for services. The shares were valued at $50,000 based on the value of the services received. There was no readily determinable market value for the shares, as they were not traded on any exchanges during that time period.

On August 22, 2011, the Company issued 12,500 shares of common stock to a third party for services. The Company recognized stock based compensation expense of $570,000 based on the closing market price of the stock on the date of issuance.

On September 27, 2011, the Company issued 15,000 shares of common stock as a result of the conversion of the Convertible Note Payable in the amount of $6,000, net of a discount of $6,000.

On October 20, 2011, the Company issued 112,500 shares of common stock as a result of the conversion of the Convertible Note Payable in the amount of $45,000, net of a discount of $43,147.

On November 3, 2011, the Company issued 22,500 shares of common stock to a third party for services. The shares were valued at $315,000 based on the closing market price of the stock on the date of issuance.

On March 5, 2012, the Company issued 120,000 shares of common stock as a result of the conversion of Convertible Notes Payable in the amount of $240,000.

- 21 -

OBJ Enterprises, Inc.

(formerly Obscene Jeans Corp.)

(A Development Stage Corporation)

Notes to Financial Statements

August 31, 2012

10. SUBSEQUENT EVENTS

On September 4, 2012, the Company signed a Convertible Promissory Note which refinanced non-interest bearing advances in the amount of $25,260 into a Convertible Note Payable. The Convertible Promissory Note bears interest at 10% per annum and is payable along with accrued interest on August 31, 2013. The Convertible Promissory Note is convertible into common stock at the option of the holder at the rate of $0.005 per share.

The Company evaluated the terms of this note in accordance with ASC Topic No. 815 – 40, Derivatives and Hedging - Contracts in Entity’s Own Stock and determined that the underlying common stock is indexed to the Company’s common stock. The Company determined that the conversion feature did not meet the definition of a liability and therefore did not bifurcate the conversion feature and account for it as a separate derivative liability. The Company evaluated the conversion feature for a beneficial conversion feature. The effective conversion price was compared to the market price on the date of the notes and was deemed to be less than the market value of underlying common stock at the inception of the note. Therefore, the Company will recognize a beneficial conversion feature in the amount of $25,260 on September 4, 2012. The beneficial conversion feature will be recognized as a discount to the Convertible Note Payable and will amortized to interest expense over the life of the note.

On September 4, 2012, the holder of the Convertible Note Payable elected to convert principal in the amount of $25,260 into 5,052,000 shares of common stock.

On October 31, 2012, the Company signed a Convertible Promissory Note which refinanced non-interest bearing advances in the amount of $52,600 into a Convertible Note Payable. The Convertible Promissory Note bears interest at 10% per annum and is payable along with accrued interest on October 31, 2013. The Convertible Promissory Note is convertible into common stock at the option of the holder at the rate of $0.01 per share.

The Company evaluated the terms of this note in accordance with ASC Topic No. 815 – 40, Derivatives and Hedging - Contracts in Entity’s Own Stock and determined that the underlying common stock is indexed to the Company’s common stock. The Company determined that the conversion feature did not meet the definition of a liability and therefore did not bifurcate the conversion feature and account for it as a separate derivative liability. The Company evaluated the conversion feature for a beneficial conversion feature. The effective conversion price was compared to the market price on the date of the notes and was deemed to be less than the market value of underlying common stock at the inception of the note. Therefore, the Company will recognize a beneficial conversion feature in the amount of $52,600 on October 31, 2012. The beneficial conversion feature will be recognized as a discount to the Convertible Note Payable and will amortized to interest expense over the life of the note.

On October 16, 2012, the holder of the Convertible Note Payable elected to convert principal in the amount of $52,600 into 5,260,000 shares of common stock.

On November 26, 2012, the holders of the Convertible Note Payable dated August 31, 2012 in the original amount of $511,468 elected to convert principal in the amount of $58,000 into 1,160,000 shares of common stock.

On November 13, 2012, the Company effected a one-for-40 reverse stock split. All share and per share amounts have been retroactively restated to reflect the reverse split.

- 22 -


ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.


ITEM 9A.	CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Management conducted its evaluation based on the framework in Internal Control – Integrated Framework issued by the Committee on Sponsoring Organizations of the Treadway Commission (COSO). Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer have concluded that, at August 31, 2012, such disclosure controls and procedures were effective.

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

Management’s Annual Report on Internal Control over Financial Reporting

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rue 13a-15(f) under the Exchange Act). Internal control over financial reporting is a process, including policies and procedures, designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with U.S. generally accepted accounting principles. Our management assessed our internal control over financial reporting based on the Internal Control – Integrated Framework issued by the COSO. Based on the results of this assessment, our management concluded that our internal control over financial reporting was effective as of August 31, 2012 based on such criteria.

A control system, no matter how well conceived or operated, can provide only reasonable, not absolute assurance that the objectives of the control system are met under all potential conditions, regardless of how remote, and may not prevent or detect all errors and all fraud. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been prevented or detected. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

Limitations on the Effectiveness of Controls

Our disclosure controls and procedures are designed to provide reasonable, not absolute, assurance that the objectives of our disclosure control system are met. Because of inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected. Based on their evaluation as of the end of the period covered by this report, management concluded that our disclosure controls and procedures were sufficiently effective to provide reasonable assurance that the objectives of our disclosure control system were met.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the fourth fiscal quarter ended August 31, 2012 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.


ITEM 9B.	OTHER INFORMATION

None

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Part III


ITEM 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Our sole officer and director will serve until her successor is elected and qualified. Our officers are elected by the board of directors to a term of one (1) year and serve until their successor is duly elected and qualified, or until they are removed from office. The board of directors has no nominating, auditing or compensation committees.

The name, address, age and position of our president, secretary/treasurer, and director and vice president is set forth below:


Name	Age	Position
Paul Watson 677 N. Washington Blvd. Sarasota, FL 34236	37	President; Secretary/Treasurer; Principal Executive Officer; Principal Financial Officer and sole member of the Board of Directors

Mr. Watson was appointed as CEO and a member of the Board of Directors on November 2, 2011.

Biographies

A seasoned executive, Mr. Watson brings a wealth of experience in finance, corporate strategy and management to the Company. He began his career working with technology start-up companies as an advisor to the Houston Technology Center, developing business plans and raising funds for entrepreneurs. He then signed on with KPMG’s Corporate Finance team in China. While working in Asian markets, he put together growth capital deals ranging from $60-100 million, sourcing funds from strategic and financial investors to expand corporate market share and sales growth. In 2009, Watson founded Hermes Investment Group, a merchant bank serving clients in Asia and North America while focusing on emerging clean technology.

From 2005 through 2009, Mr. Watson served as a mergers and acquisitions advisor and private equity group manager for KPMG Financial Advisory Services in Shanghai, China. From 2009 until 2011, he was Managing Director of Hermes Investment Group, a merchant bank focused on clean technology and environmental science established in Shanghai China, and headquartered in the United States. He is a graduate of the University of Houston Bauer College of Business with a bachelor’s degree in finance. He speaks English, Chinese and Spanish. Mr. Watson also serves as CEO and sole director of Green Technology Solutions Inc.

Mr. Watson does not have a written employment agreement or other compensatory agreement in place with the Company. He is being paid $5,000 per month for his services to the Company.

OTHER DIRECTORSHIPS

Mr. Watson also serves as CEO and sole director of Green Technology Solutions Inc.

COMMITTEES OF THE BOARD OF DIRECTORS

Our sole director has not established any committees, including an Audit Committee, a Compensation Committee or a Nominating Committee, any committee performing a similar function. The functions of those committees are being undertaken by our sole director. Because we do not have any independent directors, our sole director believes that the establishment of committees of the Board would not provide any benefits to our company and could be considered more form than substance.

We do not have a policy regarding the consideration of any director candidates that may be recommended by our stockholders, including the minimum qualifications for director candidates, nor has our sole director established a process for identifying and evaluating director nominees. We have not adopted a policy regarding the handling of any potential recommendation of director candidates by our stockholders, including the procedures to be followed. Our sole director has not considered or adopted any of these policies as we have never received a recommendation from any stockholder for any candidate to serve on our Board of Directors. Given our relative size and lack of directors and officers insurance coverage, we do not anticipate that any of our stockholders will make such a recommendation in the near future.

While there have been no nominations of additional directors proposed, in the event such a proposal is made, all current members of our Board will participate in the consideration of director nominees.

Our sole director is not an “audit committee financial expert” within the meaning of Item 401(e) of Regulation S-K. In general, an “audit committee financial expert” is an individual member of the audit committee or Board of Directors who:

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	·	understands generally accepted accounting principles and financial statements,

	·	is able to assess the general application of such principles in connection with accounting for estimates, accruals and reserves,

	·	has experience preparing, auditing, analyzing or evaluating financial statements comparable to the breadth and complexity to our financial statements,

	·	understands internal controls over financial reporting, and

	·	understands audit committee functions.

Our Board of Directors is comprised of solely of Mr. Watson who is involved in our day to day operations. We would prefer to have an audit committee financial expert on our board of directors. As with most small, early stage companies until such time our company further develops its business, achieves a stronger revenue base and has sufficient working capital to purchase directors and officers insurance, the Company does not have any immediate prospects to attract independent directors. When the Company is able to expand our Board of Directors to include one or more independent directors, the Company intends to establish an Audit Committee of our Board of Directors. It is our intention that one or more of these independent directors will also qualify as an audit committee financial expert. Our securities are not quoted on an exchange that has requirements that a majority of our Board members be independent and the Company is not currently otherwise subject to any law, rule or regulation requiring that all or any portion of our Board of Directors include “independent” directors, nor are we required to establish or maintain an Audit Committee or other committee of our Board of Directors.

CODE OF BUSINESS CONDUCT AND ETHICS

We have adopted a code of ethics meeting the requirements of Section 406 of the Sarbanes-Oxley Act of 2002. We believe our code of ethics is reasonably designed to deter wrong doing and promote honest and ethical conduct; provide full, fair, accurate, timely and understandable disclosure in public reports; comply with applicable laws; ensure prompt internal reporting of violations; and provide accountability for adherence to the provisions of the code of ethic.


ITEM 11.	EXECUTIVE COMPENSATION

Mr. Watson is paid $5,000 per month for his services to the Company. He does not have a written employment agreement with the Company.

The table below summarizes all compensation awarded to, earned by, or paid to our named executive officer for all services rendered in all capacities to us for the years ended August 31, 2012 and 2011 and for the period from inception (September 21, 2009) through August 31, 2010.

SUMMARY COMPENSATION TABLE


Name and Principal Position	Year	Salary ($)	Bonus ($)	Stock Awards ($)	Option Awards ($)	Non-Equity Incentive Plan Compensation ($)	Nonqualified Deferred Compensation ($)	All Other Compensation ($)	Total ($)
Paul Watson, President, CEO, Chairman of the Board *	2012 2011 2010	50,000 — —	— — —	— — —	— — —	— — —	— — —	— —	$ 50,000 $ — $ —
Robert Federowicz, Former President, CEO, Chairman of the Board	2012 2011 2010	5,000 70,000 —	— — —	— — —	— — —	— — —	— — —	— — —	$ 5,000 $ 70,000 $ —
Rachel Stark-Cappelli, Former President, CEO, Chairman of the Board	2012 2011 2010	20,000 42,500 —	— — —	— — —	— — —	— — —	— — —	— — —	$ 20,000 $ 42,500 $ —

* Mr. Watson was appointed to the Board of Directors on November 2, 2011. He did not receive any compensation of any kind from the Company during the year ended August 31, 2011 or the period from September 21, 2009 (date of inception) through August 31, 2010.

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OUTSTANDING EQUITY AWARDS AT AUGUST 31, 2012


	Option Awards					Stock Awards
Name	Number of Securities Underlying Unexercised Options (#) Exercisable	Number of Securities Underlying Unexercised Options (#) Unexercisable	Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)	Option Exercise Price ($	Option Expiration Date	Number of Shares of Stock That Have Not Vested (#)	Market Value of Shares of Stock That Have Not Vested ($)	Equity Incentive Plan Awards: Number of Unearned Shares or Other Rights That Have Not Vested (#)	Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares or Other Rights That Have Note Vested ($)
Rachel Stark-Cappelli	0	0	0	0	0	0	0	0	0
Robert Federowicz	0	0	0	0	0	0	0	0	0
Paul Watson	0	0	0	0	0	0	0	0	0

DIRECTOR COMPENSATION

We have no non-officer directors, and directors receive no compensation for serving on the Board. The foregoing table reflects all compensation paid to our directors.


ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

We do not currently have a stock option plan in favor of any director, officer, consultant or employee of our company. No individual grants of stock options, whether or not in tandem with stock appreciation rights known as SARs or freestanding SARs have been made to our sole director and officer since our inception; accordingly, no stock options have been granted or exercised by our sole director and officer since we were founded.

The following table sets forth certain information as of August 31, 2012, with respect to the beneficial ownership of our common stock by each beneficial owner of more than 5% of the outstanding shares of common stock of the Company, each director, each executive officer named in the “Summary Compensation Table” and all executive officers and directors of the Company as a group, and sets forth the number of shares of common stock owned by each such person and group. Unless otherwise indicated, the owners have sole voting and investment power with respect to their respective shares.


Name of Beneficial Owner	Number of Shares Beneficially Owned	Percentage of Outstanding Common Stock Owned
Kern Capital Corp. RRE Commercial Center Majuro, Marshall Islands	250,000	41%
Rachel Stark-Cappelli	—	—%
Robert Federowicz	—	—%
Paul Watson	—	—%

All directors and executive officers as a group (1 person)	—	—%


ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

None.

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ITEM 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES

Audit Fees

During the year ended August 31, 2012, we were billed by our accountants, Peter Messineo, CPA, approximately $4,100 for audit and review fees.

Tax Fees

During the year ended August 31, 2012, we were billed by our accountants, Peter Messineo, CPA, approximately $0 for tax work.

All Other Fees

During the year ended August 31, 2012, we were billed by our accountants, Peter Messineo, CPA, approximately $0 for other work.

Board of Directors Pre-Approval Process, Policies and Procedures

Our principal auditors have performed their audit procedures in accordance with pre-approved policies and procedures established by our Board of Directors. Our principal auditors have informed our Board of Directors of the scope and nature of each service provided. With respect to the provisions of services other than audit, review, or attest services, our principal accountants brought such services to the attention of our Board of Directors prior to commencing such services.


ITEM 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES


Regulation Number		Exhibit

3.1		Articles of Incorporation (1)

3.2		Bylaws (1)

31.1		Rule 13a-14(a) Certification of Chief Executive Officer (2)

32.1		Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Chief Executive Officer and Chief Financial Officer (2)

101		XBRL Interactive Data Files (3)

______________

(1) Incorporated by reference to Form S-1 filed with the Securities and Exchange Commission on April 14, 2010.

(2) Filed herewith.

(3) To be submitted by amendment.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	OBJ ENTERPRISES, INC.

Dated: December 18, 2012	By:	/s/ Paul Watson
		Paul Watson
		President, Chief Executive Officer,
		Chief Financial Officer, Principal Accounting Officer,
		Secretary, Treasurer, Director

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.


Dated: December 18, 2012	By:	/s/ Paul Watson
		Paul Watson
		Director

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