UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended May 31, 2017

 

or

 

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

 

For the transition period from to

 

Commission file number: 333-172172

 

GLOBE NET WIRELESS CORP.

(Exact name of registrant as specified in its charter)

 

Nevada		N/A
State or other jurisdiction of incorporation or organization		(I.R.S. Employer Identification No.)

 

2302-3 Pacific Plaza

410 Des Voeux Road West

Hong Kong, China

(Address of principal executive offices) (Zip Code)

 

(253)252-8637

Registrant’s telephone number, including area code

 

N/A

(Former name, former address and former fiscal year, if changed since last report)

 

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 [  ] No [X]

 

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 (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] 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 the 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 (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 Exchange Act). Yes [X] No [  ]

 

APPLICABLE ONLY TO CORPORATE ISSUERS:

 

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

 

10,800,000 shares of common stock, $0.001 par value, issued and outstanding as of July 17, 2017.

 

 

 

GLOBE NET WIRELESS CORP.

Interim Condensed Financial Statements

May 31, 2017

Stated in US Dollars

 

	PAGES
INTERIM CONDENSED BALANCE SHEETS	1
INTERIM CONDENSED STATEMENT OF OPERATIONS	2
INTERIM CONDENSED STATEMENT OF STOCKHOLDERS’ DEFICIT	3
INTERIM CONDENSED STATEMENT OF CASH FLOWS	4
NOTES TO INTERIM CONDENSED FINANCIAL STATEMENTS	5 – 7

 

 

GLOBE NET WIRELESS CORP.

 

INTERIM CONDENSED BALANCE SHEETS

 

(Unaudited)

 

		May 31, 2017				August 31, 2016
ASSETS
CURRENT ASSETS
Cash		$	14,644			$	3,684
Prepaid expenses			1,125				5,875
			15,769				9,559
Intangible Assets, net – Note 4			8,592				-
TOTAL ASSETS		$	24,361			$	9,559
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
CURRENT LIABILITIES
Accounts Payable		$	3,076			$	871
Accrued Liabilities			23,338				22,150
Notes Payable – Note 5			30,000				30,000
Convertible Note Payable – Note 6			73,006				50,500
Total Current Liabilities			129,420				103,521
STOCKHOLDER’S EQUITY (DEFICIT)
Common Stock - Note 7
Par Value: $0.001
Authorized 200,000,000 shares
Issued 10,800,000 shares			10,800				10,800
Additional Paid in Capital			90,456				72,106
Deficit Accumulated			(206,315	)			(176,868	)
Total Stockholders’ Deficit			(105,059	)			(93,962	)
Total Liabilities and Stockholders’ Deficit		$	24,361			$	9,559

 

Going concern – Note 2

 

The accompanying notes are an integral part of the financial statements

 

 

GLOBE NET WIRELESS CORP.

 

INTERIM CONDENSED STATEMENT OF OPERATIONS

 

For the three and nine months ended May 31, 2017 and May 31, 2016

 

(Unaudited)

 

		For the three				For the three				For the nine				For the nine
		months ended				months ended				months ended				months ended
		May 31, 2017				May 31, 2016				May 31, 2017				May 31, 2016
EXPENSES
General and administrative expenses		$	9,121			$	6,574			$	23,460			$	13,844
Operating loss before interest			(9,121	)			(6,574	)			(23,460	)			(13,844	)
Interest			(2,268	)			(1,215	)			(5,987	)			(3,424	)
Net loss and comprehensive loss		$	(11,389	)		$	(7,789	)		$	(29,447	)		$	(17,268	)
Loss per share of common stock
-Basic and diluted		$	(0.001	)		$	(0.001	)		$	(0.003	)		$	(0.002	)
Weighted average shares of common stock
-Basic and diluted			10,800,000				10,800,000				10,800,000				10,800,000

 

The accompanying notes are an integral part of the financial statements

 

 

GLOBE NET WIRELESS CORP.

 

INTERIM CONDENSED STATEMENT OF SHAREHOLDERS’ DEFICIT

 

(Unaudited)

 

										Additional
		Common Stock								Paid-in				Deficit
		Shares				Amount				Capital				Accumulated				Total
Balance, August 31, 2015			10,800,000			$	10,800			$	72,106			$	(148,473	)		$	(65,567	)
Net loss and comprehensive loss For the year ended August 31, 2016			-				-				-				(28,395	)			(28,395	)
Balance, August 31, 2016			10,800,000				10,800				72,106				(176,868	)			(93,962	)
Convertible debt – Note 5			-				-				18,350				-				18,350
Net loss and comprehensive loss For the nine months ended May 31, 2017			-				-				-				(29,447	)			(29,447	)
Balance May 31, 2017			10,800,000			$	10,800			$	90,456			$	(206,315	)		$	(105,059	)

 

The accompanying notes are an integral part of the financial statements

 

 

GLOBE NET WIRELESS CORP.

 

INTERIM CONDENSED STATEMENT OF CASH FLOWS

 

(Unaudited)

 

		For the nine				For the nine
		months ended				months ended
		May 31, 2017				May 31, 2016
Cash Flows from (used in) Operating Activities
Net Loss		$	(29,447	)		$	(17,268	)
Adjustments to reconcile net income to net cash provided by (used in) operating activities
Amortization			1,655
Interest on notes and convertible notes payable			5,987				3,424
Accretion on convertible notes payable			856				-
Increase (Decrease) in Operating Assets and Liabilities
Prepaid Expense			4,750				(1,250	)
Accounts Payable			2,205				(748	)
Accrued Liabilities			(4,799	)			(4,150	)
Net Cash from used in Operating Activities			(18,793	)			(19,992	)
Cash Flows from (used in) Financing Activities
Convertible note payables			40,000				20,500
Net Cash provided by Financing Activities			40,000				20,500
Cash Flows used in Investment Activities
Intangible Assets			(10,247	)			-
Net Cash used in Investment Activities			(10,247	)			-
Increase in Cash			10,960				508
Cash at Beginning of Period			3,684				819
Cash at End of Period		$	14,644			$	1,327
Supplemental cash flow information
Interest		$	5,987			$	3,424
Taxes		$	-			$	-

 

The accompanying notes are an integral part of the financial statements

 

 

GLOBE NET WIRELESS CORP

NOTES TO THE INTERIM CONDENSED FINANCIAL STATEMENTS

May 31, 2017

 

1.	Organization and nature of operations

 

Globe Net Wireless Corp. (“the Company”) was incorporated in the State of Nevada, USA on September 4, 2009. The Company is in its early development stage since its formation and has realized limited revenues from its planned operations. The Company is engaged in the development of a telecommunication business to provide internet and related services to both consumers and businesses currently in under serviced or unserviced areas at real broadband speeds through the proprietary wireless technology it acquired. The Company is also engaged in the development of the TextPro Connect app and the BizPro app. These are utility services app specifically designed for the mobile business market.

 

The Company has chosen an August 31 year end.

 

2.	Basis of Presentation - Going Concern Uncertainties

 

These financial statements have been prepared in conformity with generally accepted accounting principles in the United States, which contemplate continuation of the Company as a going concern. However, the Company has limited operations and has sustained operating losses resulting in a deficit.

 

The Company has accumulated a deficit of $206,315 since inception September 4, 2009, has yet to achieve profitable operations and further losses are anticipated in the development of its business. The Company’s ability to continue as a going concern is in substantial doubt and is dependent upon obtaining additional financing and/or achieving a sustainable profitable level of operations. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Company may seek additional equity as necessary and it expects to raise funds through private or public equity investment in order to support existing operations and expand the range of its business. There is no assurance that such additional funds will be available for the Company on acceptable terms, if at all.

 

3.	Interim reporting and significant accounting policies

 

The interim condensed financial statements are prepared under the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America. While the information presented is unaudited, it includes all adjustments, which are, in the opinion of management, necessary to present fairly the financial position, result of operation and cash flows for the interim periods presented in accordance with accounting principles generally accepted in the United States of America. All adjustments are of a normal recurring nature. It is suggested that the interim condensed financial statements be read in conjunction with the Company’s August 31, 2016 annual financial statements. Operating results for the nine months period ended May 31, 2017 are not necessarily indicative of the results that can be expected for the year ended August 31, 2017.

 

There have been no changes in the accounting policies from those disclosed in the notes to the audited financial statements for the year ended August 31, 2016.

 

 

Recently issued accounting pronouncements

 

The Company adopts new pronouncements relating to generally accepted accounting principles applicable to the Company as they are issued, which may be in advance of their effective date. Management does not believe that any pronouncement not yet effective but recently issued would, if adopted, have a material effect on the accompanying financial statements.

 

4.	Intangibles Assets

 

The Company developed services utility apps. The assets are amortized over 3 years on a straight-line basis.

 

Item		Cost				Accumulated Amortization				Net
Text Pro App		$	8,333			$	1,389			$	6,944
Biz Pro App			1,913				265				1,648
Total		$	10,246			$	1,654			$	8,592

 

5.	Notes payable

 

The company has four notes payable that are unsecured, bear interest at 8% per annum and are due on demand. The interest is classified as accrued liabilities for financial statement purposes.

 

Date		Principal				Interest				Total
September 16, 2011		$	5,000			$	2,284			$	7,284
October 4, 2011			5,000				2,264				7,264
November 4, 2011			10,000				4,460				14,460
December 3, 2012			10,000				3,595				13,595
Total		$	30,000			$	12,603			$	42,603

 

6.	Convertible Notes Payable

 

There are five convertible notes payable that are unsecured, bearing interest at 8% per annum, due on demand and convertible at a conversion price of $0.005 per share at the lender’s option. The interest is classified as accrued liabilities for financial statement purposes.

 

There was no value assigned to the conversion feature of these notes as the shares that would have been issued were not readily convertible into cash at the time the debt was issued.

 

Date		Principal				Interest				Total
May 17, 2013		$	10,000			$	3,233			$	13,233
Sep 11, 2015			10,000				1,376				11,376
Nov 12, 2015			5,000				620				5,620
Nov 13, 2015			5,000				619				5,619
Apr 11, 2016			500				46				546
Balance		$	30,500			$	5,894			$	36,394

 

There is one convertible note payable that bear interest at 8% per annum, due on demand and convertible at a conversion price of $0.5625 per share at the lender’s option. The interest is classified as accrued liabilities for financial statement purposes.

 

 

There was no value assigned to the conversion feature of one of these notes issued as the shares that would have been issued were not readily convertible into cash at the time the debt was issued

 

Date		Principal				Interest				Total
Jul 11, 2016		$	20,000			$	1,420			$	21,420

 

On October 31, 2016, the Company issued another demand convertible promissory note for $20,000 that had a conversion price of $0.5625 per share at the lender’s option. The conversion feature was valued at $18,350. $856 was accreted and charged to interest during the period. At May 31, 2017, the unamortized discount was $17,494.

 

Date		Proceeds Assigned to debt				Interest				Total
Oct 31, 2016		$	1,650			$	929			$	2,579
Accretion during the period			856				-				856
Balance		$	2,506			$	929			$	3,435

 

There is one convertible note payable that bear interest at 10% per annum, due on demand and convertible at a conversion price of $0.10 per share at the lender’s option. The interest is classified as accrued liabilities for financial statement purposes.

 

There was no beneficial conversion feature at the time of issuance and, accordingly, no value has been assigned to the conversion feature.

 

Date		Principal				Interest				Total
Apr 17, 2017		$	20,000			$	241			$	20,241
Total		$	73,006			$	8,484			$	81,490

 

7.	Common stock

 

There were no warrants or stock options outstanding as of May 31, 2017.

 

There were no significant non-cash transactions during the period ended May 31, 2017.

 

 

FORWARD LOOKING STATEMENTS

 

Statements made in this Form 10-Q that are not historical or current facts are “forward-looking statements” made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 (the “Act”) and Section 21E of the Securities Exchange Act of 1934. These statements often can be identified by the use of terms such as “may,” “will,” “expect,” “believe,” “anticipate,” “estimate,” “approximate” or “continue,” or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management’s best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

 

GENERAL

 

Globe Net Wireless Corp. was incorporated under the laws of the State of Nevada, U.S. on September 4, 2009. Our registration statement on Form S-1 was filed with the Securities and Exchange Commission was declared effective on May 15, 2013.

 

Globe Net is a startup company engaged in the development of proprietary wireless broadband technology for the purpose of becoming a rural internet service provider (RISP). Globe Net is a “shell” company as defined by the SEC as a result of only having nominal operations and nominal assets. Globe Net is an “emerging growth company” under the federal securities laws and will be subject to reduced public company reporting requirements. Globe Net’s mission is to provide rural communities with high-speed internet connectivity at speeds equal or better than existing competing services. Through the use of its Internet and wireless connectivity systems, Globe Net will try to provide internet and related services to both consumers and businesses in currently under serviced or unserviceable areas at real broadband speeds. Globe Net plans to offer for sale its GNW Systems to residents and businesses located in under-serviced or non-serviced rural areas worldwide with the initial focus on North America and China.

 

RESULTS OF OPERATIONS

 

Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation. We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.

 

Nine-month Period Ended May 31, 2017 Compared to the Nine-month Period Ended May 31, 2016.

 

Our net loss for the nine-month period ended May 31, 2017 was $29,447 (2016: $17,268), which consisted of general and administration expenses and interest on a note payable. We did not generate any revenue during either nine-month period in fiscal 2017 or 2016. The increase in expenses in the current fiscal year relate to an increase in administrative expenses associated with being a reporting issuer and interest expense no notes payable.

 

The weighted average number of shares outstanding was 10,800,000 for the nine-month period ended May 31, 2017 and 10,800,000 for the period ended May 31, 2016.

 

 

Three-month Period Ended May 31, 2017 Compared to the Three-month Period Ended May 31, 2016.

 

Our net loss for the three-month period ended May 31, 2017 was $11,389 (2016: $7,789), which consisted of general and administration expenses and interest on a note payable. We did not generate any revenue during either three-month period in fiscal 2017 or 2016. The increase in expenses in the current fiscal year relate to an increase in administrative expenses associated with being a reporting issuer and interest expense no notes payable.

 

The weighted average number of shares outstanding was 10,800,000 for the three-month periods ended May 31, 2017 and 10,800,000 for May 31, 2016.

 

LIQUIDITY AND CAPITAL RESOURCES

 

As at May 31, 2017, our current assets were $24,361 compared to $9,559 in current assets at August 31, 2016. As at May 31, 2017, our current liabilities were $129,420 compared to $103,521 at August 31, 2016. Current liabilities at May 31, 2017 were comprised of $103,006 in notes payable and $3,076 in accounts payable and $23,338 in accrued liabilities.

 

Stockholders’ deficit increased from $93,962 as of August 31, 2016 to $105,059 as of May 31, 2017

 

Cash Flows from Operating Activities

 

We have not generated positive cash flows from operating activities. For the nine-month period ended May 31, 2017, net cash flows used in operating activities were $18,793 consisting of a net loss of $29,447 less adjustments for non-cash expenses of amortization of $1,655, accrued interest of $5,987 and accretion expenses of $856. Changes in operating assets and liabilities were $2,205 in accounts payable, and $4,799 in accrued liabilities and $4,750 in prepaid expenses. For the nine-month period ended May 31, 2016, net cash flows used in operating activities were $19,992 consisting of a net loss of $17,268 less non-cash expense of accrued interest of $3,424and changes in operating assets and liabilities of $1,250 in prepaid expenses, $748 in accounts payable and $4,150 in accrued liabilities.

 

Cash Flows from Financing Activities

 

We have financed our operations primarily from either the issuance of our shares of common stock or notes payable. For the nine-month period ended May 31, 2017, we realized $40,000 in net cash from financing activities. We generated $20,500 cash from financing activities in the comparative period in fiscal 2016.

 

PLAN OF OPERATION AND FUNDING

 

We expect that working capital requirements will continue to be funded through a combination of our existing funds and further issuances of securities. Our working capital requirements are expected to increase in line with the growth of our business.

 

Existing working capital, further advances and debt instruments, and anticipated cash flow are expected to be adequate to fund our operations over the next three months. We have no lines of credit or other bank financing arrangements. Generally, we have financed operations to date through the proceeds of the private placement of equity and debt instruments. In connection with our business plan, management anticipates additional increases in operating expenses and capital expenditures relating to: (i) acquisition of inventory; (ii) developmental expenses associated with a start-up business; and (iii) marketing expenses. We intend to finance these expenses with further issuances of securities and director loans. Thereafter, we expect we will need to raise additional capital and generate revenues to meet long-term operating requirements. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, which could significantly and materially restrict our business operations. We will have to raise additional funds in the next twelve months in order to sustain and expand our operations. We currently do not have a specific plan of how we will obtain such funding; however, we anticipate that additional funding will be in the form of equity financing from the sale of our common stock. We have and will continue to seek to obtain short-term loans from our directors, although no future arrangement for additional loans has been made. We do not have any agreements with our directors concerning these loans. We do not have any arrangements in place for any future equity financing.

 

 

OFF-BALANCE SHEET ARRANGEMENTS

 

As of the date of this report, 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 are material to investors.

 

GOING CONCERN

 

The independent auditors’ report accompanying our August 31, 2016 financial statements contained an explanatory paragraph expressing substantial doubt about our ability to continue as a going concern. The financial statements have been prepared “assuming that we will continue as a going concern,” which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

 

No report required.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) that is designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

 

An evaluation was conducted under the supervision and with the participation of our management of the effectiveness of the design and operation of our disclosure controls and procedures as of May 31, 2017. Based on that evaluation, our management concluded that our disclosure controls and procedures were effective as of such date to ensure that information required to be disclosed in the reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms. Such officer also confirmed that there was no change in our internal control over financial reporting during the nine-month period ended May 31, 2017 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

 

 

PART II. OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

Management is not aware of any legal proceedings contemplated by any governmental authority or any other party involving us or our properties. As of the date of this Quarterly Report, no director, officer or affiliate is (i) a party adverse to us in any legal proceeding, or (ii) has an adverse interest to us in any legal proceedings. Management is not aware of any other legal proceedings pending or that have been threatened against us or our properties.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

None.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable.

 

ITEM 5. OTHER INFORMATION

 

None.

 

 

ITEM 6. EXHIBITS

 

Exhibits:

 

31.1	Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302(a) of the Sarbanes-Oxley Act
32.1	Certification of Chief Executive Officer and Chief Financial Officer Under Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act.
101	Interactive data files pursuant to Rule 405 of Regulation S-T.

 

 

SIGNATURES

 

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

	GLOBE NET WIRELESS CORP.
Dated: July 17, 2017	By:	/s/ Gustavo Americo Folcarelli
		Gustavo Americo Folcarelli, President and Chief Executive Officer and Chief Financial Officer