Document and Entity Information
Document and Entity Information - USD ($) | Nov. 13, 2018 | Jul. 31, 2018 | Jan. 31, 2018 |
Details | |||
Registrant Name | HAMMER FIBER OPTICS HOLDINGS CORP. | ||
Registrant CIK | 1,539,680 | ||
SEC Form | 10-K | ||
Period End date | Jul. 31, 2018 | ||
Fiscal Year End | --07-31 | ||
Trading Symbol | hmmr | ||
Tax Identification Number (TIN) | 981,032,170 | ||
Number of common stock shares outstanding | 60,503,341 | ||
Public Float | $ 0 | ||
Filer Category | Non-accelerated Filer | ||
Current with reporting | Yes | ||
Voluntary filer | No | ||
Well-known Seasoned Issuer | No | ||
Shell Company | false | ||
Small Business | true | ||
Emerging Growth Company | true | ||
Ex Transition Period | false | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2,018 | ||
Document Fiscal Period Focus | FY | ||
Entity Incorporation, State Country Name | Nevada | ||
Entity Address, Address Line One | 311 Broadway | ||
Entity Address, City or Town | Point Pleasant Beach | ||
Entity Address, State or Province | NJ | ||
Entity Address, Postal Zip Code | 8,742 | ||
City Area Code | 844 | ||
Local Phone Number | 413-2600 | ||
Entity Listing, Par Value Per Share | $ 0.001 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Jul. 31, 2018 | Jul. 31, 2017 |
Assets, Current | ||
Cash and cash equivalents | $ 3,441 | $ 528,380 |
Accounts Receivable | 19,332 | 7,488 |
Other Assets, Current | 9,488 | 31,842 |
Assets, Current | 32,261 | 567,710 |
Other Assets | ||
Property, Plant and Equipment, Net | 4,593,635 | 5,005,016 |
Intangible Assets, Net (Excluding Goodwill) | 18,934 | 18,934 |
Deposits | 11,310 | 12,949 |
Note receivable | 0 | 235,000 |
Total other assets | 4,623,879 | 5,271,899 |
Assets | 4,656,140 | 5,839,609 |
Liabilities, Current | ||
Accounts Payable, Current | 256,243 | 111,612 |
Notes and Loans, Noncurrent | 0 | 6,905 |
Notes Payable - related parties | 230,000 | 0 |
Current portion of long-term notes payable - related parties | 3,394,067 | 1,210,000 |
Accrued interest | 289,050 | 107,094 |
Liabilities, Current | 4,169,360 | 1,435,611 |
Notes payable - related parties | 0 | 2,394,567 |
Liabilities | 4,169,360 | 3,830,178 |
Stockholders' Equity Attributable to Parent | ||
Common Stock, Value, Issued | 60,503 | 60,503 |
Treasury stock | 0 | 0 |
Additional Paid in Capital | 14,617,719 | 10,625,287 |
Retained Earnings (Accumulated Deficit) | (14,191,442) | (8,676,359) |
Stockholders' Equity Attributable to Parent | 486,780 | 2,009,431 |
Liabilities and Equity | $ 4,656,140 | $ 5,839,609 |
Consolidated Balance Sheets - P
Consolidated Balance Sheets - Parenthetical - $ / shares | Jul. 31, 2018 | Jul. 31, 2017 |
Details | ||
Common Stock, Par or Stated Value Per Share | $ 0.001 | $ 0.001 |
Common Stock, Shares Authorized | 250,000,000 | 250,000,000 |
Common Stock, Shares, Issued | 60,503,341 | 60,503,341 |
Common Stock, Shares, Outstanding | 52,946,162 | 51,960,948 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Jul. 31, 2018 | Jul. 31, 2017 | |
Details | ||
REVENUE | $ 455,609 | $ 87,692 |
Costs and Expenses | ||
Operations and maintenance | 17,508 | 23,979 |
General and administrative | 4,527,059 | 4,884,652 |
Depreciation, Depletion and Amortization, Nonproduction | 1,041,958 | 872,103 |
Total operating expenses | 5,586,525 | 5,780,734 |
Operating Income (Loss) | (5,130,916) | (5,693,042) |
OTHER INCOME (EXPENSE) | ||
Interest Expense | (391,227) | (351,643) |
Interest income | 7,060 | 7,642 |
Other Income | 0 | 1,850 |
Total other income (expense) | (384,167) | (342,151) |
NET LOSS | $ (5,515,083) | $ (6,035,193) |
Weighted Average Number of Shares Outstanding, Basic and Diluted | 52,400,747 | 51,960,948 |
Loss per common share - basic and diluted | $ (0.11) | $ (0.12) |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity - USD ($) | Common Stock | Treasury Stock | Additional Paid-in Capital | Retained Earnings | Total |
Equity Balance, Starting at Jul. 31, 2016 | $ 60,503 | $ 0 | $ 5,422,284 | $ (2,641,166) | $ 2,841,621 |
Shares Outstanding, Starting at Jul. 31, 2016 | 60,503,341 | 9,291,670 | |||
Capital contributions | $ 0 | $ 0 | 5,203,003 | 0 | 5,203,003 |
Capital Contribution, Shares | 0 | (749,277) | |||
Net Income (Loss) | $ 0 | $ 0 | 0 | (6,035,193) | (6,035,193) |
Shares Outstanding, Ending at Jul. 31, 2017 | 60,503,341 | 8,542,393 | |||
Equity Balance, Ending at Jul. 31, 2017 | $ 60,503 | $ 0 | 10,625,287 | (8,676,359) | 2,009,431 |
Stock Issued During Period, Value, New Issues | $ 0 | $ 0 | 2,600,652 | 0 | 2,600,652 |
Stock Issued During Period, Shares, New Issues | 0 | (800,914) | |||
Stock Issued During Period, Value, Issued for Services | $ 0 | $ 0 | 1,259,347 | 0 | 1,259,347 |
Stock Issued During Period, Shares, Issued for Services | 0 | (184,300) | |||
Prepayment of loan by Director on behalf of the Company | $ 0 | $ 0 | 132,433 | 0 | 132,433 |
Net Income (Loss) | $ 0 | $ 0 | 0 | (5,515,083) | (5,515,083) |
Shares Outstanding, Ending at Jul. 31, 2018 | 60,503,341 | 7,557,179 | |||
Equity Balance, Ending at Jul. 31, 2018 | $ 60,503 | $ 0 | $ 14,617,719 | $ (14,191,442) | $ 486,780 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Jul. 31, 2018 | Jul. 31, 2017 | |
Cash flows from operating activities: | ||
Net Income (Loss) | $ (5,515,083) | $ (6,035,193) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Depreciation and amortization | 1,041,958 | 872,103 |
Bad debt expense | (16,302) | 750,000 |
Services received paid with shares of stock | 1,259,347 | 0 |
Interest paid on behalf of the Company | 29,433 | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (34,846) | (7,488) |
Other current assets | 9,297 | 37,220 |
Accrued interest | 181,956 | 99,477 |
Accounts payable | 82,881 | (560,078) |
Net cash used in operating activities | (2,961,359) | (4,843,959) |
Cash flows from investing activities: | ||
Acquisition of property and equipment | (568,827) | (734,261) |
Cash repaid on note receivable | 289,000 | 65,000 |
Net cash used in investing activities | (279,827) | (669,261) |
Cash flows from financing activities: | ||
Proceeds from loans | 103,000 | 310,000 |
Proceeds from loans - related party | 20,000 | 0 |
Repayment of loans | (6,905) | (35,157) |
Repayment of loans - related party | (500) | 0 |
Proceeds from issuance of treasury shares | 2,600,652 | 5,203,003 |
Net cash provided by financing activities | 2,716,247 | 5,477,846 |
Net increase (decrease) in cash | (524,939) | (35,374) |
Cash and cash equivalents | 528,380 | 563,754 |
Cash and cash equivalents | 3,441 | 528,380 |
Cash Flow, Noncash Investing and Financing Activities Disclosure | ||
Interest Paid, Including Capitalized Interest, Operating and Investing Activities | 175,000 | 250,831 |
Income Taxes Paid, Net | 8,486 | 7,362 |
Non-cash investing and financing activities: | ||
Purchase of property and equipment with accounts payable | 61,750 | 20,475 |
Prepayment of loan by Director on behalf of the Company | $ 103,000 | $ 0 |
NOTE 1 - ORGANIZATION AND DESCR
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS | 12 Months Ended |
Jul. 31, 2018 | |
Notes | |
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS | NOTE 1 ORGANIZATION AND DESCRIPTION BUSINESS Hammer W |
NOTE 2 - CORPORATE HISTORY AND
NOTE 2 - CORPORATE HISTORY AND BACKGROUND ON MERGER | 12 Months Ended |
Jul. 31, 2018 | |
Notes | |
NOTE 2 - CORPORATE HISTORY AND BACKGROUND ON MERGER | NOTE 2 CORPORATE HISTORY AND BACKGROUND ON MERGER The Company was originally incorporated in the State of Nevada on September 23, 2010, under the name Recursos Montana S.A. The Companys principal activity was an exploration stage company engaged in the acquisition of mineral properties then owned by the Company. On February 2, 2015, the Company entered into a Share Exchange Agreement with Tanaris Power Holdings, Inc., whereby the Company acquired 100% of Tanaris Power Holdings, Inc. issued and outstanding common stock in exchange for shares of the Companys common stock equal to 51% of the issued and outstanding common stock of the Company. Tanaris Power Holdings, Inc. was the owner of certain rights in connection with the marketing and sale of smart lithium-ion batteries and battery technologies for various industrial vehicles markets and related applications. On March 6, 2015, the Company amended its Articles of Incorporation to change its name to Tanaris Power Holdings, Inc. On April 25, 2016, Tanaris Power Holdings, Inc., a Nevada corporation entered into s Share Exchange Agreement (the Share Exchange Agreement) with Hammer Fiber Optics Investments, Ltd., a Delaware corporation (HFOI), and the controlling stockholders of HFOI (the HFOI Shareholders). Pursuant to the Share Exchange Agreement, the Company acquired 20,000,000 shares of common stock of HFOI from the HFOI shareholders (the HFOI Shares) and in exchange, the Company issued to the HFOI Shareholders 50,000,000 (post-Merger) restricted shares of its common stock (the HMMR Shares). As a result of the Share Exchange Agreement, HFOI became a wholly owned subsidiary of the Company. On April 13, 2016, the Board of Directors (BOD) approved a Plan of Merger (the Plan of Merger) under Nevada Revised Statuses (NRS) Section 92A.180 to merge (the Merger) with our wholly-owned subsidiary HFO Holdings, a Nevada corporation, to effect a name change from Tanaris Power Holdings Inc. to Hammer Fiber Optics Holdings Corp. The Plan of Merger also provided for a 1 for 1,000 exchange ratio for shareholders of both the Company and the HRO Holdings, which had the effect of a 1 for 1,000 reverse split of the common stock. Articles of Merger were filed with the Secretary of State of Nevada on April 13, 2016 and, on April 14, 2016, this corporate action was submitted to Financial Industry Regulatory Authority (the FINRA) for its review and approval. On May 3, 2016, the FINRA approved the merger with the wholly-owned subsidiary, HMMR Fiber Optics Holdings Corp. (HFO Holdings). Accordingly, thereafter, the Companys name was changed and the shares of common stock began trading under new ticker symbol HMMR as of May 27, 2016. The merger was effected on July 19, 2016. |
NOTE 3 - SUMMARY OF SIGNIFICANT
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Jul. 31, 2018 | |
Notes | |
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE R Basis of presentation The Use of estimates The f f Cash and cash equivalents Cash Property and equipment Property Impairment of long-lived assets The exceeds Notes Receivable These Indefinite lived intangible assets The y y The . Revenue recognition The The Revenue is recorded net of discounts provided to customers. Discounts applied during the years July 31, 2018 and 2017 were $22,314 and $14,364, respectively. Income taxes The T f f f a Fair value measurements The T V The ASC y Level Level Consolidation of financial statements Hammer W Basic and Diluted Earnings (Loss) per Common Share The r r y y Recent In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers. The Company does not expect the adoption of any other recent accounting pronouncements to have a material impact on its financial statements. Reclassifications Certain prior period amounts have been reclassified to conform with current period presentation. In July 2016, certain shareholders of the Company contributed 9,291,670 restricted shares of their common stock to the Companys wholly-owned subsidiary, Hammer Wireless Corporation, for the purpose of effecting acquisitions, joint ventures or other business combinations with third parties. Then, Hammer Wireless sold a portion of these restricted shares to third parties and contributed the proceeds to the Company. Since such contribution was an inter-company transaction, any impact on the financial statements is eliminated in the consolidation of these financial statements. During fiscal year ended July 31, 2018 shares held by Hammer Wireless Corporation have been reclassified as Treasury Shares for the purposes of determining the number of outstanding shares of the company. In the fiscal year ended July 31, 2017, the Company reported loss of asset impairment of $750,000 related to a note receivable. In the fiscal year ended July 31, 2018, the Company recovered $289,000 related to this note receivable. Accordingly, the loss of asset impairment in fiscal 2017 has been reclassified to general and administrative expense in the statement of operations, and in fiscal 2018, we have reported the full recovery of bad debt of $289,000 in general and administrative expense . Accounts Receivable Accounts receivable are recorded at invoiced amount and generally do not bear interest. An allowance for doubtful accounts is established, as necessary, based on past experience and other factors which, in management's judgment, deserve current recognition in estimating bad debts. Such factors include growth and composition of accounts receivable, the relationship of the allowance for doubtful accounts to accounts receivable and current economic conditions. The determination of the collectability of amounts due from customer accounts requires the Company to make judgments regarding future events and trends. Allowances for doubtful accounts are determined based on assessing the Companys portfolio on an individual customer and on an overall basis. This process consists of a review of historical collection experience, current aging status of the customer accounts, and the financial condition of the Companys customers. As of July 31, 2018, the Company recorded an allowance for doubtful accounts of $23,002 based on historical collection activity for accounts older than 90 days. |
NOTE 4 - GOING CONCERN
NOTE 4 - GOING CONCERN | 12 Months Ended |
Jul. 31, 2018 | |
Notes | |
NOTE 4 - GOING CONCERN | NOTE 4 GOING CONCERN The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has consistently sustained losses since its inception. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern. The Companys continuation as a going concern is dependent upon, among other things, its ability to increase revenues, adequately control operating expenses and receive debt and/or equity capital from third parties. No assurance can be given that the Company will be successful in these efforts. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company intends to continue to address this condition by seeking to raise additional capital through the issuance of debt and/or the sale of equity until such time that ongoing revenues can sustain the business, at which time capitalization may be considered through other means. |
NOTE 5 - NOTES RECEIVABLE
NOTE 5 - NOTES RECEIVABLE | 12 Months Ended |
Jul. 31, 2018 | |
Notes | |
NOTE 5 - NOTES RECEIVABLE | NOTE 5 NOTES RECEIVABLE During was y The Company had entered into a loan agreement during the year ended July 31, 2016 with Zena Capital, LLC for an aggregate amount of $1,000,000. Payments totaling $250,000 had been made against the loan; however, the loan was in default as of July 31, 2017. The Company recorded an impairment loss for the full $750,000 in July 2017 after determining that the collectability of the note, as well, as the services to be rendered by Zena Capital, LLC, were no longer assured. In 2018, the Company received payments totaling $289,000 as partial recovery of the outstanding loan balance. The partial recovery is reported in general and administrative expense on the Consolidated Statement of Operations. See also the reclassifications footnote related to the 2017 amounts. |
NOTE 6 - PROPERTY AND EQUIPMENT
NOTE 6 - PROPERTY AND EQUIPMENT | 12 Months Ended |
Jul. 31, 2018 | |
Notes | |
NOTE 6 - PROPERTY AND EQUIPMENT | NOTE 6 PROPERTY AND EQUIPMENT As of July 31, 2018, property and equipment consisted of the following: Amount Life Computer m $ 4,636,066 5 Building & Structures 119,416 10 Office i 94,287 5-6 Computer 79,952 3 Capitalized 1,880,554 5 Sub-total 6,810,275 Less: A (2,216,640) Total $ 4,593,635 As of July 31, 2017, property and equipment consisted of the following: Amount Life Computer m $ 4,014,389 5 Building & Structures 110,516 10 Office i 94,287 5-6 Computer 79,952 3 Capitalized 1,880,554 5 Sub-total 6,179,698 Less: Accumulated (1,174,682) Total $ 5,005,016 Depreciation expense was $1,041,958 and $872,103 for the years ended July 31, 2018 and 2017, respectively. |
NOTE 7 - INDEFINITE LIVED INTAN
NOTE 7 - INDEFINITE LIVED INTANGIBLE ASSETS | 12 Months Ended |
Jul. 31, 2018 | |
Notes | |
NOTE 7 - INDEFINITE LIVED INTANGIBLE ASSETS | NOTE 7 INDEFINITE LIVED INTANGIBLE ASSETS The |
NOTE 8 - RELATED PARTY TRANSACT
NOTE 8 - RELATED PARTY TRANSACTIONS | 12 Months Ended |
Jul. 31, 2018 | |
Notes | |
NOTE 8 - RELATED PARTY TRANSACTIONS | NOTE 8 RELATED PARTY TRANSACTIONS On Board of Directors ( On April, 9 2018, the Company received an additional $20,000 deposit from a family member of a member of the BOD. The amount was intended as additional working capital. The Company anticipates execution of a loan agreement relative to this advance. During The $1,000,000 note matured on June 9, 2018 at which time the principal became due in its entirety, in addition to simple interest accrued at 3%. The company is currently in default on this loan. On June 19, 2018, a convertible promissory note that was entered into on February 12, 2018 by the Company for the sum of $103,000 was settled in full on the companys behalf by a Director. The settlement included a prepayment penalty for a full settlement amount of $132,433. The difference between the carrying value of the loan and the full settlement amount ($29,433) was recorded as interest expense. As of July 31, 2018, all of the related party payables are reported as current liabilities in the Consolidated Balance Sheet. |
NOTE 9 - CONVERTIBLE DEBT
NOTE 9 - CONVERTIBLE DEBT | 12 Months Ended |
Jul. 31, 2018 | |
Notes | |
NOTE 9 - CONVERTIBLE DEBT | NOTE 9 CONVERTIBLE DEBT On February 12, 2018, the Company entered into an agreement for a convertible promissory note for the sum of $103,000. The note accrues interest at a rate of 12 percent per annum due at maturity. The note matures nine months from the issuance date. Prepayment of the note is subject to a premium charge based on the amount of days prepaid before the maturity date. The note allows conversion into the Companys common stock at a discount of 37 percent of the stocks market price. The holder shall have the right after 180 days to convert all or part of the note at their discretion. On June 19, 2018 the note was settled in full on the companys behalf by a Director (see Note 8). |
NOTE 10 - INCOME TAXES
NOTE 10 - INCOME TAXES | 12 Months Ended |
Jul. 31, 2018 | |
Notes | |
NOTE 10 - INCOME TAXES | NOTE 10 The Companys income tax expense, deferred tax assets and liabilities, and liabilities for unrecognized tax benefits reflect managements best estimate of current and future taxes to be paid. The Company is subject to income taxes in the United States and numerous foreign jurisdictions. Significant judgments and estimate are required in the determination of the consolidated income tax expense. The reconciliation of income tax benefit at the U.S. statutory rate of 35% for the fiscal year ended July 31, 2017, to the Companys effective tax rate is as follows: Income tax benefit provision at statutory rate $ (2,655,485) Change 2,655,485 Income tax benefit provision $ - The tax effects of temporary differences that give rise to the Companys net deferred tax assets as of July 31, 2017 are as follows: Net $ 1,823,482 Valuation (1,823,482) Net $ - The reconciliation of income tax benefit at the federal and state statutory blended rates for the fiscal year ended July 31, 2018, to the Companys effective tax rate is as follows: Income tax benefit provision at statutory rate $ (1,158,167) Change 1,158,167 Income tax benefit provision $ - The tax effects of temporary differences that give rise to the Companys net deferred tax assets as of July 31, 2018 are as follows: Net $ 2,981,649 Valuation (2,981,649) Net $ - The Tax Cuts and Jobs Act of 2017 (the Act) reduced the statutory corporate federal income tax rate from 35% to 21% beginning in 2018. The blended tax rate for 2018 considered the tax laws enacted in 2017. The tax effect of temporary differences from net operating losses (NOL) has been reduced to reflect the newly enacted rate. The Company has approximately $14,200,000 of NOL carried forward to offset taxable income in future years. The tax laws enacted in 2017 also changed the treatment of NOL. Prior to the change, NOL could be carried back up to two years and carried forward up to 20 years to offset taxable income. In the new tax law, the NOL that can be carried forward is limited to 80% of the taxable income, can no longer be carried back, but are allowed to be carried forward indefinitely. The new law will apply to NOL arising in tax years beginning December 31, 2017, hence, $3,000,000 of the NOL will be subject to the 80% limitation and will be carried forward indefinitely while $11,200,000 of the NOL will be carried forward for 20 years and will begin to expire in 2036. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the period in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the assessment, management has established a full valuation allowance against all of the deferred tax assets relating to NOLs for every period because it is more likely than not that all of the deferred tax asset will not be realized. As of July 31, 2018 and 2017, the Company has no unrecognized income tax benefits. The Companys policy for classifying interest and penalties associated with unrecognized income tax benefits is to include such items as a tax expense. No interest or penalties have been recorded during the years ended July 31, 2018 and 2017. As of July 31, 2018 and 2017, the Company did not have any amounts recorded pertaining to uncertain tax positions. The tax years from 2015 and forward remain open to examination by federal and state authorities due to net operating loss and credit carryforwards. The Company is currently not under examination by the Internal Revenue Service or any other taxing authorities. |
NOTE 11 - STOCKHOLDERS' EQUITY
NOTE 11 - STOCKHOLDERS' EQUITY | 12 Months Ended |
Jul. 31, 2018 | |
Notes | |
NOTE 11 - STOCKHOLDERS' EQUITY | NOTE 11 T Treasury Stock During the year ended July 31, 2018, the Company received cash of $2,600,651 from the sale of 800,914 treasury shares to various investors and a Director. Price Per Share Shares Value $7.00 239,230 $1,674,610 $4.00 20,750 $83,000 $3.00 70,200 $210,600 $2.50 111,600 $279,000 $1.50 73,334 $110,001 $1.10 7,000 $7,700 $1.00 63,500 $63,500 $0.80 215,300 $172,240 Total 800,914 $2,600,651 Additionally, the Company issued 184,300 treasury shares to third parties for services provided during the year. The Company valued these shares using the closing quoted price of the Companys common stock on the date of issuance. This resulted in an increase in the Companys general and administrative expenses amounting to $1,259,347 . During the year ended July 31, 2017, the Company received cash of $5,203,003 from the sale of 749,277 Treasury Shares sold to third parties. These transactions represent capital contributions and did not result in an increase in the number of shares outstanding. Price Per Share Shares Value $7.00 728,294 $5,098,058 $5.00 20,989 $104,945 Total 749,277 $5,203,003 As a result of these transactions, the Company has a balance of 7,557,179 and 8,542,393 in treasury shares as of July 31, 2018 and 2017, respectively. |
NOTE 12 - COMMITMENTS AND LEASE
NOTE 12 - COMMITMENTS AND LEASES | 12 Months Ended |
Jul. 31, 2018 | |
Notes | |
NOTE 12 - COMMITMENTS AND LEASES | NOTE 12 COMMITMENTS AND LEASES The Company is committed under numerous operating leases for its offices and various installations of operating equipment. The office leases are commitments of 1 to 3 years and have extension of varying lives. Equipment and installation locations have varying leases of between 3 and 5 years and also have varying renewal option of up to 5 years at time for 15 additional years. The Company is also commited to long term technical agreements governed under service orders with several difference major telecommunications operators for access to dark fiber in conjunction with rack space and power at data centers. Commitments on these technical agreements run from 5 to 10 years. The future minimum lease payments are provided below. Amount For the fiscal year ended July 31, 2019 $ 879,851 For the fiscal year ended July 31, 2020 852,864 For the fiscal year ended July 31, 2021 428,356 For the fiscal year ended July 31, 2022 353,988 For the fiscal year ended July 31, 2023 and thereafter 864,768 Rent expense for the Company amounted to $830,145 and $873,000 for the fiscal years ended July 31, 2018 and 2017, respectively. |
NOTE 13 - SUBSEQUENT EVENTS
NOTE 13 - SUBSEQUENT EVENTS | 12 Months Ended |
Jul. 31, 2018 | |
Notes | |
NOTE 13 - SUBSEQUENT EVENTS | NOT 13 SUBSEQUEN EVENTS Subsequent to July 31, 017, the Company received cash of $8,600 from the sale of 17,200 Treasury Shares sold to third parties. The Company also issued 110,000 shares of common stock for services to employees of the Company from Treasury Shares. On September 12, 2018 the Company entered into a stock purchase agreement with Open Data Centers, LLC (the Seller). The purchase price for all of the Company Units is two million nine hundred thirty thousand five hundred sixty-six (2,930,566) shares of the Companys Common Stock from treasury stock. The shares of the Companys Common Stock to be issued are restricted securities, as defined in Rule 144 of the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended. The Company shall also pay Sellers a sum of $200,000 in Cash, delivered to the Sellers no later than January 10, 2019. On September 11, 2018 the Company entered into a stock purchase agreement with 1stPoint Communications, LLC (the Seller). The purchase price for all of the Company Units is three million six hundred and forty-three thousand six hundred and forty-four (3,643,644) shares of the Companys Common Stock from treasury stock. Seventy five percent (75%) of the shares of the Companys Common Stock to be issued are restricted securities, as defined in Rule 144 of the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended. On September 11, 2018 the Company entered into a stock purchase agreement with Endstream Communications, LLC (the Seller). The purchase price for all of the Company Units is one million nine hundred and fifty-seven thousand one hundred and sixteen (1,957,116) shares of the Companys Common Stock from treasury stock. Seventy five percent (75%) of the shares of Buyer Common Stock to be issued are restricted securities, as defined in Rule 144 of the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended. On September 11, 2018 the Company entered into a stock purchase agreement with Shelcomm, Inc. (the Seller). The purchase price for all of the Company Units is nine hundred thousand (900,000) shares of the Companys Common Stock from treasury stock. The shares of the Companys Common Stock to be issued are restricted securities, as defined in Rule 144 of the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended. The value of the shares issued to the Sellers will be based upon the closing price on the date the transaction is completed. All restricted shares are as defined under Rule 144 of Securities and Exchange Commission and are restricted for a period of twelve (12) months from the date of closing. |
NOTE 3 - SUMMARY OF SIGNIFICA_2
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Basis of presentation (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Policies | |
Basis of presentation | Basis of presentation The |
NOTE 3 - SUMMARY OF SIGNIFICA_3
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Use of estimates (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Policies | |
Use of estimates | Use of estimates The f f |
NOTE 3 - SUMMARY OF SIGNIFICA_4
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Cash and cash equivalents (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Policies | |
Cash and cash equivalents | Cash and cash equivalents Cash |
NOTE 3 - SUMMARY OF SIGNIFICA_5
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Property and equipment (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Policies | |
Property and equipment | Property and equipment Property |
NOTE 3 - SUMMARY OF SIGNIFICA_6
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Impairment of long-lived assets (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Policies | |
Impairment of long-lived assets | Impairment of long-lived assets The |
NOTE 3 - SUMMARY OF SIGNIFICA_7
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Notes receivable (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Policies | |
Notes receivable | Notes Receivable These |
NOTE 3 - SUMMARY OF SIGNIFICA_8
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Indefinite-lived intangible assets (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Policies | |
Indefinite-lived intangible assets | Indefinite lived intangible assets The y y The |
NOTE 3 - SUMMARY OF SIGNIFICA_9
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Revenue recognition (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Policies | |
Revenue recognition | Revenue recognition The The Revenue is recorded net of discounts provided to customers. Discounts applied during the years July 31, 2018 and 2017 were $22,314 and $14,364, respectively. |
NOTE 3 - SUMMARY OF SIGNIFIC_10
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Income taxes (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Policies | |
Income taxes | Income taxes The T f f f |
NOTE 3 - SUMMARY OF SIGNIFIC_11
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Fair value measurements (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Policies | |
Fair value measurements | Fair value measurements The T V The ASC y Level Level |
NOTE 3 - SUMMARY OF SIGNIFIC_12
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Consolidation of financial statements (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Policies | |
Consolidation of financial statements | Consolidation of financial statements Hammer W |
NOTE 3 - SUMMARY OF SIGNIFIC_13
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Basic and Diluted Earnings (Loss) per Common Share (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Policies | |
Basic and Diluted Earnings (Loss) per Common Share | Basic and Diluted Earnings (Loss) per Common Share The r r y y |
NOTE 3 - SUMMARY OF SIGNIFIC_14
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Recent Accounting Pronouncements (Policies) | 12 Months Ended |
Jul. 31, 2018 | |
Policies | |
Recent Accounting Pronouncements | Recent In May 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2014-09, Revenue from Contracts with Customers. The Company does not expect the adoption of any other recent accounting pronouncements to have a material impact on its financial statements. |
NOTE 6 - PROPERTY AND EQUIPME_2
NOTE 6 - PROPERTY AND EQUIPMENT: Property, Plant and Equipment (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Tables/Schedules | |
Property, Plant and Equipment | As of July 31, 2018, property and equipment consisted of the following: Amount Life Computer m $ 4,636,066 5 Building & Structures 119,416 10 Office i 94,287 5-6 Computer 79,952 3 Capitalized 1,880,554 5 Sub-total 6,810,275 Less: A (2,216,640) Total $ 4,593,635 As of July 31, 2017, property and equipment consisted of the following: Amount Life Computer m $ 4,014,389 5 Building & Structures 110,516 10 Office i 94,287 5-6 Computer 79,952 3 Capitalized 1,880,554 5 Sub-total 6,179,698 Less: Accumulated (1,174,682) Total $ 5,005,016 |
NOTE 10 - INCOME TAXES_ Schedul
NOTE 10 - INCOME TAXES: Schedule of Income Tax Expense, Deferred Tax Assets and Liabilities, and Reconciliation of Income Tax Benefit (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Tables/Schedules | |
Schedule of Income Tax Expense, Deferred Tax Assets and Liabilities, and Reconciliation of Income Tax Benefit | The reconciliation of income tax benefit at the U.S. statutory rate of 35% for the fiscal year ended July 31, 2017, to the Companys effective tax rate is as follows: Income tax benefit provision at statutory rate $ (2,655,485) Change 2,655,485 Income tax benefit provision $ - The tax effects of temporary differences that give rise to the Companys net deferred tax assets as of July 31, 2017 are as follows: Net $ 1,823,482 Valuation (1,823,482) Net $ - The reconciliation of income tax benefit at the federal and state statutory blended rates for the fiscal year ended July 31, 2018, to the Companys effective tax rate is as follows: Income tax benefit provision at statutory rate $ (1,158,167) Change 1,158,167 Income tax benefit provision $ - The tax effects of temporary differences that give rise to the Companys net deferred tax assets as of July 31, 2018 are as follows: Net $ 2,981,649 Valuation (2,981,649) Net $ - |
NOTE 11 - STOCKHOLDERS' EQUITY_
NOTE 11 - STOCKHOLDERS' EQUITY: Schedule of Treasury Shares (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Tables/Schedules | |
Schedule of Treasury Shares | Price Per Share Shares Value $7.00 239,230 $1,674,610 $4.00 20,750 $83,000 $3.00 70,200 $210,600 $2.50 111,600 $279,000 $1.50 73,334 $110,001 $1.10 7,000 $7,700 $1.00 63,500 $63,500 $0.80 215,300 $172,240 Total 800,914 $2,600,651 |
NOTE 11 - STOCKHOLDERS' EQUIT_2
NOTE 11 - STOCKHOLDERS' EQUITY: Schedule of Capital Contributions (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Tables/Schedules | |
Schedule of Capital Contributions | Price Per Share Shares Value $7.00 728,294 $5,098,058 $5.00 20,989 $104,945 Total 749,277 $5,203,003 |
NOTE 12 - COMMITMENTS AND LEA_2
NOTE 12 - COMMITMENTS AND LEASES: Schedule of Future Minimum Lease Payments (Tables) | 12 Months Ended |
Jul. 31, 2018 | |
Tables/Schedules | |
Schedule of Future Minimum Lease Payments | The future minimum lease payments are provided below. Amount For the fiscal year ended July 31, 2019 $ 879,851 For the fiscal year ended July 31, 2020 852,864 For the fiscal year ended July 31, 2021 428,356 For the fiscal year ended July 31, 2022 353,988 For the fiscal year ended July 31, 2023 and thereafter 864,768 Rent expense for the Company amounted to $830,145 and $873,000 for the fiscal years ended July 31, 2018 and 2017, respectively. |
NOTE 2 - CORPORATE HISTORY AN_2
NOTE 2 - CORPORATE HISTORY AND BACKGROUND ON MERGER (Details) | 12 Months Ended |
Jul. 31, 2018 | |
Details | |
Entity Incorporation, State Country Name | Nevada |
Entity Incorporation, Date of Incorporation | Sep. 23, 2010 |
NOTE 5 - NOTES RECEIVABLE (Deta
NOTE 5 - NOTES RECEIVABLE (Details) | Jul. 31, 2018USD ($) |
MEK Investments Inc. | |
Financing Receivable, Gross | $ 235,000 |
Zena Capital LLC | |
Financing Receivable, Gross | $ 1,000,000 |
NOTE 6 - PROPERTY AND EQUIPME_3
NOTE 6 - PROPERTY AND EQUIPMENT: Property, Plant and Equipment (Details) - USD ($) | Jul. 31, 2018 | Jul. 31, 2017 |
Property, Plant and Equipment, Gross | $ 6,810,275 | $ 6,179,698 |
Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment | (2,216,640) | (1,174,682) |
Property, Plant and Equipment, Net | 4,593,635 | 5,005,016 |
Computer Equipment | ||
Property, Plant and Equipment, Gross | $ 4,636,066 | $ 4,014,389 |
Property, Plant and Equipment, Useful Life | 5 years | 5 years |
Office Equipment | ||
Property, Plant and Equipment, Gross | $ 94,287 | $ 94,287 |
Software Development | ||
Property, Plant and Equipment, Gross | $ 79,952 | $ 79,952 |
Property, Plant and Equipment, Useful Life | 3 years | 3 years |
Other Capitalized Property Plant and Equipment | ||
Property, Plant and Equipment, Gross | $ 1,880,554 | $ 1,880,554 |
Property, Plant and Equipment, Useful Life | 5 years | 5 years |
Building | ||
Property, Plant and Equipment, Gross | $ 110,516 | |
Property, Plant and Equipment, Useful Life | 10 years | |
Minimum | Office Equipment | ||
Property, Plant and Equipment, Useful Life | 5 years | 5 years |
Maximum | Office Equipment | ||
Property, Plant and Equipment, Useful Life | 6 years | 6 years |
NOTE 6 - PROPERTY AND EQUIPME_4
NOTE 6 - PROPERTY AND EQUIPMENT (Details) - USD ($) | 12 Months Ended | |
Jul. 31, 2018 | Jul. 31, 2017 | |
Details | ||
Depreciation | $ 1,041,958 | $ 872,103 |
NOTE 7 - INDEFINITE LIVED INT_2
NOTE 7 - INDEFINITE LIVED INTANGIBLE ASSETS (Details) - USD ($) | Jul. 31, 2018 | Jul. 31, 2017 |
Details | ||
Intangible Assets, Net (Excluding Goodwill) | $ 18,934 | $ 18,934 |
NOTE 8 - RELATED PARTY TRANSA_2
NOTE 8 - RELATED PARTY TRANSACTIONS (Details) | 12 Months Ended |
Jul. 31, 2018USD ($) | |
Family member of a member of the Company's Board of Directors | |
Related Party Transaction, Date | Oct. 9, 2016 |
Related Party Transaction, Description of Transaction | Company entered into a short-term loan agreement with a family member of a member of the Company’s Board of Directors (BOD) |
Related Party Transaction, Amounts of Transaction | $ 100,000 |
Related Party Transaction, Rate | 3.00% |
Revenue from Related Parties | $ 210,000 |
Promissory Note with related party | |
Related Party Transaction, Description of Transaction | Company entered into two promissory notes with a Director |
Related Party Transaction, Terms and Manner of Settlement | terms consist of ten principal and interest payments due quarterly |
Promissory Note with related party - 1 | |
Related Party Transaction, Amounts of Transaction | $ 2,400,000 |
Promissory Note with related party - 2 | |
Related Party Transaction, Amounts of Transaction | $ 1,000,000 |
NOTE 10 - INCOME TAXES_ Sched_2
NOTE 10 - INCOME TAXES: Schedule of Income Tax Expense, Deferred Tax Assets and Liabilities, and Reconciliation of Income Tax Benefit (Details) - USD ($) | 12 Months Ended | |
Jul. 31, 2018 | Jul. 31, 2017 | |
Details | ||
Effective Income Tax Rate Reconciliation at Federal Statutory Income Tax Rate, Amount | $ (1,158,167) | $ (2,655,485) |
Valuation Allowance, Deferred Tax Asset, Increase (Decrease), Amount | 1,158,167 | 2,655,485 |
Income Tax Expense (Benefit) | 0 | 0 |
Deferred Tax Assets, Operating Loss Carryforwards | 2,981,649 | 1,823,482 |
Deferred Tax Assets, Valuation Allowance | (2,981,649) | (1,823,482) |
Deferred Tax Assets, Net of Valuation Allowance | $ 0 | $ 0 |
NOTE 11 - STOCKHOLDERS' EQUIT_3
NOTE 11 - STOCKHOLDERS' EQUITY: Schedule of Treasury Shares (Details) - USD ($) | 12 Months Ended | |
Jul. 31, 2018 | Jul. 31, 2017 | |
Treasury Shares Sold - 1 | ||
Treasury Stock Sold, Price Per Share | $ 7 | $ 7 |
Treasury Stock Sold, Number of Shares | 239,230 | 728,294 |
Treasury Stock Sold,Value | $ 1,674,610 | $ 5,098,058 |
Treasury Shares Sold - 2 | ||
Treasury Stock Sold, Price Per Share | $ 4 | $ 5 |
Treasury Stock Sold, Number of Shares | 20,750 | 20,989 |
Treasury Stock Sold,Value | $ 83,000 | $ 104,945 |
Treasury Shares Sold - 3 | ||
Treasury Stock Sold, Price Per Share | $ 3 | |
Treasury Stock Sold, Number of Shares | 70,200 | |
Treasury Stock Sold,Value | $ 210,600 | |
Treasury Shares Sold - 4 | ||
Treasury Stock Sold, Price Per Share | $ 2.50 | |
Treasury Stock Sold, Number of Shares | 111,600 | |
Treasury Stock Sold,Value | $ 279,000 | |
Treasury Shares Sold - 5 | ||
Treasury Stock Sold, Price Per Share | $ 1.50 | |
Treasury Stock Sold, Number of Shares | 73,334 | |
Treasury Stock Sold,Value | $ 110,001 | |
Treasury Shares Sold - 6 | ||
Treasury Stock Sold, Price Per Share | $ 1.10 | |
Treasury Stock Sold, Number of Shares | 7,000 | |
Treasury Stock Sold,Value | $ 7,700 | |
Treasury Shares Sold - 7 | ||
Treasury Stock Sold, Price Per Share | $ 1 | |
Treasury Stock Sold, Number of Shares | 63,500 | |
Treasury Stock Sold,Value | $ 63,500 | |
Treasury Shares Sold - 8 | ||
Treasury Stock Sold, Price Per Share | $ 0.80 | |
Treasury Stock Sold, Number of Shares | 215,300 | |
Treasury Stock Sold,Value | $ 172,240 | |
Treasury Stock Sold, Number of Shares | 800,914 | 749,277 |
Treasury Stock Sold,Value | $ 2,600,651 | $ 5,203,003 |
NOTE 11 - STOCKHOLDERS' EQUITY
NOTE 11 - STOCKHOLDERS' EQUITY (Details) - USD ($) | 12 Months Ended | ||
Jul. 31, 2018 | Jul. 31, 2017 | Jul. 31, 2016 | |
Stock Issued During Period, Value, Issued for Services | $ 1,259,347 | ||
Capital contributions | $ 5,203,003 | ||
Proceeds from issuance of treasury shares | $ 2,600,652 | 5,203,003 | |
Treasury Stock | |||
Stock Issued During Period, Shares, Issued for Services | (184,300) | ||
Stock Issued During Period, Value, Issued for Services | $ 0 | ||
Capital contributions | $ 0 | ||
Capital Contribution, Shares | (749,277) | ||
Shares, Outstanding | 7,557,179 | 8,542,393 | 9,291,670 |
NOTE 11 - STOCKHOLDERS' EQUIT_4
NOTE 11 - STOCKHOLDERS' EQUITY: Schedule of Capital Contributions (Details) - USD ($) | 12 Months Ended | |
Jul. 31, 2018 | Jul. 31, 2017 | |
Treasury Shares Sold - 1 | ||
Treasury Stock Sold, Price Per Share | $ 7 | $ 7 |
Treasury Stock Sold, Number of Shares | 239,230 | 728,294 |
Treasury Stock Sold,Value | $ 1,674,610 | $ 5,098,058 |
Treasury Shares Sold - 2 | ||
Treasury Stock Sold, Price Per Share | $ 4 | $ 5 |
Treasury Stock Sold, Number of Shares | 20,750 | 20,989 |
Treasury Stock Sold,Value | $ 83,000 | $ 104,945 |
Treasury Stock Sold, Number of Shares | 800,914 | 749,277 |
Treasury Stock Sold,Value | $ 2,600,651 | $ 5,203,003 |
NOTE 12 - COMMITMENTS AND LEA_3
NOTE 12 - COMMITMENTS AND LEASES (Details) | 12 Months Ended |
Jul. 31, 2018 | |
Office leases | |
Long-term Purchase Commitment, Description | commitments of 1 to 3 years and have extension of varying lives |
Equipment and installation | |
Long-term Purchase Commitment, Description | varying leases of between 3 and 5 years and also have varying renewal option of up to 5 years at time for 15 additional years. |
Technical agreements | |
Long-term Purchase Commitment, Description | Commitments on these technical agreements run from 5 to 10 years. |
NOTE 12 - COMMITMENTS AND LEA_4
NOTE 12 - COMMITMENTS AND LEASES: Schedule of Future Minimum Lease Payments (Details) - USD ($) | 12 Months Ended | |
Jul. 31, 2018 | Jul. 31, 2017 | |
Details | ||
Operating Leases, Future Minimum Payments Due, Next Twelve Months | $ 879,851 | |
Operating Leases, Future Minimum Payments, Due in Two Years | 852,864 | |
Operating Leases, Future Minimum Payments, Due in Three Years | 428,356 | |
Operating Leases, Future Minimum Payments, Due in Four Years | 353,988 | |
Operating Leases, Future Minimum Payments, Due Thereafter | 864,768 | |
Payments for Rent | $ 830,145 | $ 873,000 |
NOTE 13 - SUBSEQUENT EVENTS (De
NOTE 13 - SUBSEQUENT EVENTS (Details) | 12 Months Ended |
Jul. 31, 2018shares | |
Event 1 | |
Subsequent Event, Description | Company received cash of $8,600 from the sale of 17,200 Treasury Shares |
Stock Issued During Period, Shares | 17,200 |
Event 1a | |
Subsequent Event, Description | Company also issued 110,000 shares of common stock for services |
Stock Issued During Period, Shares | 110,000 |
Event 2 | |
Subsequent Event, Description | Company entered into a stock purchase agreement with Open Data Centers, LLC |
Subsequent Event, Date | Sep. 12, 2018 |
Event 3 | |
Subsequent Event, Description | Company entered into a stock purchase agreement with 1stPoint Communications, LLC |
Subsequent Event, Date | Sep. 11, 2018 |
Event 4 | |
Subsequent Event, Description | Company entered into a stock purchase agreement with Endstream Communications, LLC |
Subsequent Event, Date | Sep. 11, 2018 |
Event 5 | |
Subsequent Event, Description | Company entered into a stock purchase agreement with Shelcomm, Inc. |
Subsequent Event, Date | Sep. 11, 2018 |