0001078782-18-001427.txt : 20181219 0001078782-18-001427.hdr.sgml : 20181219 20181219102017 ACCESSION NUMBER: 0001078782-18-001427 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 54 CONFORMED PERIOD OF REPORT: 20181031 FILED AS OF DATE: 20181219 DATE AS OF CHANGE: 20181219 FILER: COMPANY DATA: COMPANY CONFORMED NAME: HAMMER FIBER OPTICS HOLDINGS CORP CENTRAL INDEX KEY: 0001539680 STANDARD INDUSTRIAL CLASSIFICATION: COMMUNICATION SERVICES, NEC [4899] IRS NUMBER: 981032170 STATE OF INCORPORATION: NV FISCAL YEAR END: 0731 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-35876 FILM NUMBER: 181242470 BUSINESS ADDRESS: STREET 1: 15 CORPORATE PLACE SOUTH CITY: PISCATAWAY STATE: NJ ZIP: 08854 BUSINESS PHONE: 844-413-2600 MAIL ADDRESS: STREET 1: 15 CORPORATE PLACE SOUTH CITY: PISCATAWAY STATE: NJ ZIP: 08854 FORMER COMPANY: FORMER CONFORMED NAME: Tanaris Power Holdings Inc. DATE OF NAME CHANGE: 20150310 FORMER COMPANY: FORMER CONFORMED NAME: Recursos Montana S.A. DATE OF NAME CHANGE: 20120113 10-Q 1 f10q103118_10q.htm FORM 10-Q QUARTERLY REPORT Form 10-Q Quarterly Report

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

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

 

For the quarterly period ended October 31, 2018

 

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

 

For the transition period from:

 

Commission file number 000-1539680

 

HAMMER FIBER OPTICS HOLDINGS CORP.

(Exact name of registrant as specified in its charter)

 

NEVADA

98-1032170

(State or Other Jurisdiction of Incorporation of Organization)

(I.R.S. Employer Identification No.)

 

 

15 Corporate Place South, Suite 100#, Piscataway, NJ 08854

(Address of principal executive offices)

 

844-413-2600

(Registrant’s telephone number, including area code)

 

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 [   ]

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405of 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 [   ] (Not required)

 

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 definition of “large accelerated filer and “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large Accelerated Filer

[   ]

Non-Accelerated Filer

[   ]

Accelerated Filer

[   ]

Smaller Reporting Company

[X]

Emerging Growth Company

[X]

 

 

 

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

 

As of December 14, 2018, there were 60,503,341 shares of the registrant’s $.001 par value common stock issued and 53,135,762 shares outstanding.


1


 

 

 

HAMMER FIBER OPTICS HOLDINGS CORP.

 

TABLE OF CONTENTS

 

Page

PART I. FINANCIAL INFORMATION

 

ITEM 1.

CONSOLIDATED FINANCIAL STATEMENTS

3

ITEM 2.

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

12

ITEM 3.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

14

ITEM 4.

CONTROLS AND PROCEDURES

14

 

PART II. OTHER INFORMATION

 

ITEM 1.

LEGAL PROCEEDINGS

15

ITEM 1A.

RISK FACTORS

15

ITEM 2.

UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

15

ITEM 3.

DEFAULTS UPON SENIOR SECURITIES

15

ITEM 4.

MINE SAFETY DISCLOSURES

15

ITEM 5.

OTHER INFORMATION

15

ITEM 6.

EXHIBITS

15

 

Special Note Regarding Forward-Looking Statements

 

Information included in this Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). This information may involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Hammer Fiber Optics Holdings Corp. (the “Company”), to be materially different from future results, performance or achievements expressed or implied by any forward-looking statements. Forward-looking statements, which involve assumptions and describe future plans, strategies and expectations of the Company, are generally identifiable by use of the words “may,” “will,” “should,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. These forward-looking statements are based on assumptions that may be incorrect, and there can be no assurance that these projections included in these forward-looking statements will come to pass. Actual results of the Company could differ materially from those expressed or implied by the forward-looking statements as a result of various factors. Except as required by applicable laws, the Company has no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future.

 

*Please note that throughout this Quarterly Report, and unless otherwise noted, the words "we," "our," "us," the "Company," "HMMR," or Hammer Fiber Optics Holdings Corp.


2


 

 

HAMMER FIBER OPTICS HOLDINGS CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

ASSETS

 

October 31, 2018

 

July 31, 2018

 

 

(UNAUDITED)

 

Restated

Current Assets

 

 

 

 

Cash

$

1,150

$

3,441

Accounts Receivable, net

 

22,185

 

19,332

Other current assets

 

4,829

 

9,488

 

Total current assets

 

28,164

 

32,261

 

 

 

 

 

Other Assets

 

 

 

 

Property and equipment, net

 

4,330,238

 

4,593,635

Intangible assets

 

18,934

 

18,934

Deposits

 

11,310

 

11,310

 

Total other assets

 

4,360,482

 

4,623,879

 

 

 

 

 

TOTAL ASSETS

$

4,388,646

$

4,656,140

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

Accounts payable

$

174,710

$

256,243

Notes Payable – related party

 

230,000

 

230,000

Current portion of long-term notes payable - related parties

 

3,394,067

 

3,394,067

Accrued interest

 

382,474

 

289,050

 

Total current liabilities

 

4,181,251

 

4,169,360

 

 

 

 

 

TOTAL LIABILITIES

 

4,181,251

 

4,169,360

 

 

 

 

 

STOCKHOLDERS' EQUITY

 

 

 

 

Common stock, $0.001 par value, 250,000,000 shares authorized,

 

 

 

 

60,503,341 shares issued at October 31, 2018 and July 31, 2018;

53,135,762 and 52,946,162 shares outstanding at October 31, 2018 and

July 31, 2018, respectively.

 

60,503

 

60,503

Treasury stock

 

-

 

-

Shares to be issued

 

176,100

 

-

Additional paid-in capital

 

14,675,659

 

14,617,719

Accumulated deficit

 

(14,704,867)

 

(14,191,442)

 

Total Stockholders' Equity

 

207,395

 

486,780

 

 

 

 

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

4,388,646

$

4,656,140

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.


3


 

 

HAMMER FIBER OPTICS HOLDINGS CORP.

CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

(UNAUDITED)

 

 

 

 

For the Quarter Ended

October 31,

 

 

 

2018

 

2017

 

 

 

 

 

 

REVENUE

$

47,232

$

37,293

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

Operations and maintenance

 

5,597

 

2,207

General and administrative

 

195,686

 

2,109,169

Depreciation expense

 

263,397

 

279,036

 

Total operating expenses

 

464,680

 

2,390,412

 

 

 

 

 

 

LOSS FROM OPERATIONS

 

(417,448)

 

(2,353,119)

 

 

 

 

 

 

OTHER INCOME AND EXPENSE

 

 

 

 

Interest expense

 

(95,977)

 

(86,284)

Interest income

 

-

 

1,765

 

Total other income (expense)

 

(95,977)

 

(84,519)

 

 

 

 

 

 

NET LOSS

$

(513,425)

$

(2,437,638)

 

 

 

 

 

 

Weighted average number of common shares outstanding –

  basic and diluted

 

53,031,038

 

52,180,159

 

 

 

 

 

 

Loss per common share - basic and diluted

$

(0.01)

$

(0.05)

 

 

 

 

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.


4


 

 

HAMMER FIBER OPTICS HOLDINGS CORP.

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

(UNAUDITED)

 

 

 

For the Quarter Ended

 

 

October 31,

 

 

2018

 

2017

 

 

 

 

 

Cash flows from operating activities:

 

 

 

 

Net loss

$

(513, 425)

$

(2,437,638)

Adjustments to reconcile net loss to net cash used in operating activities:

 

 

 

 

Depreciation and amortization

 

263,397

 

279,036

Services received paid with shares of stock

 

49,340

 

943,500

Changes in operating assets and liabilities

 

 

 

 

Accounts receivable

 

(2,853)

 

(7,565)

Other current assets

 

4,659

 

11,617

Accounts payable

 

(81,533)

 

(80,293)

Accrued interest

 

93,424

 

12,507

Net cash used in operating activities

 

(186,991)

 

(1,278,836)

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

Acquisition of property and equipment

 

-

 

(389,830)

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

Repayment of loans

 

-

 

(6,905)

Proceeds from sale of shares of treasury stock

 

184,700

 

1,398,508

Net cash provided by financing activities

 

184,700

 

1,391,603

 

 

 

 

 

Net change in cash

 

(2,291)

 

(277,063)

Cash at beginning of period

 

3,441

 

528,380

Cash at end of period

$

1,150

$

251,317

 

 

 

 

 

Supplemental disclosures of cash flows information:

 

 

 

 

Interest paid

$

2,553

$

75,000

Taxes paid

$

5,774

$

-

 

 

The accompanying notes are an integral part of these condensed consolidated financial statements.


5


 

 

HAMMER FIBER OPTICS HOLDINGS CORP.

NOTES TO CONDENSED FINANCIAL STATEMENTS

JULY 31, 2018 and 2017

 

NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS

 

Hammer Fiber Optics Holdings Corp. (“the Company”) is an alternative telecommunications carrier formed to provide high capacity broadband through a wireless access network. Hammer Fiber Optics Holdings Corp. is the parent company and sole shareholder of Hammer Wireless Corporation and Hammer Fiber Optic Investments Ltd. The financial statements for Hammer Fiber Optics Holdings Corp. and its wholly-owned subsidiary are reported on a consolidated basis. All significant intercompany accounts and transactions have been eliminated.

 

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 Company’s 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 Company’s 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 shall become 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 provides 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 Company’s 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 ACCOUNTING POLICIES

 

Basis of presentation

 

The accompanying consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The interim financial statements for the fiscal quarter ending October 31, 2018 are unaudited. These financial statements are prepared in accordance with requirements for unaudited interim periods and consequently do not include all disclosures required to be in conformity with accounting principles generally accepted in the United States of America. The results of operations for the interim periods are not necessarily indicative of the results for the full year. In management's opinion, all adjustments necessary for a fair presentation of the Company's financial statements are reflected in the interim periods included and are of a normal recurring nature. These interim financial statements should be read in conjunction with the financial statements included in our Form 10-K, for the year ended July 31, 2018, as filed with the Securities and Exchange Commission (“the SEC”) at www.sec.gov.


6


 

 

Use of estimates

 

The preparation of financial statements in conformity with GAAP 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 amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

Cash and cash equivalents

 

Cash and cash equivalents include cash in banks, money market funds, and certificates of term deposits with maturities of less than three months from inception, which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of loss in value.

 

Property and equipment

 

Property and equipment is stated at cost less accumulated depreciation. Depreciation is provided for on a straight-line basis over the useful lives of the assets. For network service equipment, and furniture and fixtures, the useful life is ten and five years, respectively. Leasehold Improvements are depreciated over six years. Expenditures for additions and improvements are capitalized; repairs and maintenance are expensed as incurred.

 

Impairment of long-lived assets

 

The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to future undiscounted cash flows to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets. The Company has not recognized impairment losses.

 

Indefinite lived intangible assets

 

The Company reviews property, plant and equipment, inventory component prepayments and certain identifiable intangibles, excluding goodwill, for impairment. Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Recoverability of these assets is measured by comparison of their carrying amounts to future undiscounted cash flows the assets are expected to generate. If property, plant and equipment, inventory component prepayments and certain identifiable intangibles are considered to be impaired, the impairment to be recognized equals the amount by which the carrying value of the assets exceeds its fair value. The Company has not recorded any related impairment losses.

 

The Company does not amortize goodwill and intangible assets with indefinite useful lives, rather such assets are required to be tested for impairment at least annually or sooner whenever events or changes in circumstances indicate that the assets may be impaired. The Company has not recorded any related impairment losses.

 

Revenue recognition

 

We adopted ASC 606 on August 1, 2018. Revenue is measured based on a consideration specified in a contract or agreement with a customer. The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer. Incidental items that are immaterial in the context of the contract are recognized as expense. Unearned revenues are recorded when cash payments are received or due in advance of the performance of the services. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue.

 

The Company’s revenues consist primarily of subscription agreements for its broadband internet and voice-over-IP phone services. Residential broadband service delivered to customers over the Company’s hybrid fiber and wireless network in Atlantic County, New Jersey is the primary revenue source. Revenues are supplemented by phone and add-on services. Broadband services delivered via fiber optics to enterprise businesses account for the remaining sources of revenue. Services are billed monthly to subscribers on either a one- year or two-year contract for residential customers and three-year contracts for enterprise business customers. Revenue begins accruing as service is delivered at commencement of the customer’s service contract.


7


 

 

Revenue is recorded net of discounts provided to customers. Discounts applied during the quarter ended October 31, 2018 and 2017 were $3,287 and $6,319, respectively.

 

Income taxes

 

The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, “Accounting for Income Taxes”. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

 

Fair value measurements

 

The Company adopted the provisions of ASC Topic 820, “Fair Value Measurements and Disclosures”, which defines fair value as used in numerous accounting pronouncements, establishes a framework for measuring fair value and expands disclosure of fair value measurements.

 

The estimated fair value of certain financial instruments, including cash and cash equivalents are carried at historical cost basis, which approximates their fair values because of the short-term nature of these instruments.

 

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, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value:

 

Level 1 — quoted prices in active markets for identical assets or liabilities

 

Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable

 

Level 3 — inputs that are unobservable (for example cash flow modeling inputs based on assumptions) The Company has no assets or liabilities valued at fair value on a recurring basis.

 

Consolidation of financial statements

 

Hammer Fiber Optics Holdings Corp. is the parent company and sole shareholder of Hammer Wireless Corporation. The financial statements for Hammer Fiber Optics Holdings Corp. and its wholly-owned subsidiaries are reported on a consolidated basis. All significant intercompany accounts and transactions have been eliminated.

 

Basic and Diluted Earnings (Loss) per Common Share

 

The basic earnings (loss) per share are calculated by dividing the Company's net income available to common shareholders by the weighted average number of common shares during the year. The diluted earnings (loss) per share is calculated by dividing the Company's net income (loss) available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. Diluted earnings (loss) per share are the same as basic earnings (loss) per share due to the lack of dilutive items in the Company. As of October 31, and July 31, 2018, there were no common stock equivalents outstanding.

 

Recent accounting pronouncements

 

In June 2018, the FASB issued ASU No. 2018-07, Compensation – Stock Compensation (Topic 718) (“ASU 2018-07”). ASU 2018-07 provides for improvements to nonemployee share-based payment accounting by expanding the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The awards will be measured at grant date, consistent with accounting for employee share-based payment awards. The measurement date has been redefined as the date at which the grantor and grantee reach a mutual understanding of the key terms and conditions of the award. The requirement to reassess classification of equity-classified awards upon vesting has been eliminated. We do not expect the adoption of this standard to have a material impact on the Company’s financial statements. The Company adopted ASU 2018-07 August 1, 2018.


8


 

 

In February 2016, FASB issued ASU No. 2016-02, Accounting Standards Update No. 2016-02, Leases (Topic 842).  ASU 2016-02 provides for improvements for accounting guidance related to a leasing treatments on financial statements as a response to user input. The update maintains two classifications of leases, Financial lease and Operating leases.   The Update is effective for fiscal years beginning after December 2015, 2018.  The company has not yet adopted this standard but there may be impact to the presentation of the Company’s financial statements during the period of adoption.

 

NOTE 4 – 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

$

834,969

For the fiscal year ended July 31, 2020

 

820,464

For the fiscal year ended July 31, 2021

 

404,276

For the fiscal year ended July 31, 2022

 

1,197,956

For the fiscal year ended July 31, 2023 and thereafter

 

 

 

NOTE 5 – 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 for a period of one year from the issuance of these financial statements. The Company’s 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 6 – PROPERTY AND EQUIPMENT

 

As of July 31, 2018, property and equipment consisted of the following:

 

 

 

Amount

 

Life

 

 

 

 

 

Computer and Telecom equipment

$

4,636,066

 

5 years

Building & Structures

 

119,416

 

10 years

Office equipment, furniture, fixtures

 

94,287

 

5-6 years

Computer software

 

79,952

 

3 years

Capitalized labor costs

 

1,880,554

 

5 years

 

Sub-total

 

6,810,275

 

 

Less: Accumulated depreciation and amortization

 

(2,216,640)

 

 

Total

$

4,593,635

 

 

 

Depreciation expense was $263,397 and $279,036 for the quarters ended October 31, 2018 and 2017, respectively.


9


 

 

NOTE 7 – INDEFINITE LIVED INTANGIBLE ASSETS

 

The Company has $18,934 of recognized indefinite lived intangible assets, which consist of the ownership of Internet Protocol version 4 (IPv4) address blocks. These assets are not amortized and are evaluated routinely for potential impairment. If a determination is made that the intangible asset is impaired after performing the initial qualitative assessment, the asset’s fair value will be calculated and compared with the carrying value to determine whether an impairment loss should be recognized.

 

NOTE 8 – RELATED PARTY TRANSACTIONS

 

During the fiscal year ended July 31, 2016, the Company entered into two promissory notes with a related party for an aggregate amount of $2,400,000 and $1,000,000, respectively. The $2,400,000 note matures on January 4, 2019. The terms consist of ten principal and interest payments due quarterly in the amount of $300,000 for total payments of $3,000,000. The Company is currently in default on this loan. To date, the Company has made payments on this note amounting to $725,831. The payments were applied to interest accrued as of the time of payment as well as to principal. The principal balance was $2,294,067 at July 31, 2018 and 2017. The interest accrued was $219,434 at July 31, 2018 and $69,594 at July 31, 2017, respectively.

 

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.

 

For period ending October 31, 2018, 142,500 treasury shares were purchased by a Director of the Company, for cash of $142,500. As none of these shares were issued as of October 31, 2018, the full amount is reported in Shares to be issued, on the balance sheet (see also additional shares to be issued, as identified below in footnote 9).  As of October 31, 2018, all of the related party payables are reported as current liabilities in the Consolidated Balance Sheet.

 

NOTE 9 – STOCKHOLDERS’ EQUITY

 

Treasury Stock

 

In July 2016, certain shareholders of the Company contributed 9,291,670 restricted shares of their common stock to the Company’s wholly-owned subsidiary, Hammer Wireless Corporation (“Treasury Shares”), for the purpose of effecting acquisitions, joint ventures or other business combinations with third parties. According to ASC 810-10-45 Consolidations, these shares are accounted for as treasury stock.

 

During the three months ended October 31, 2018, the Company received cash of $184,700 from the sale of 255,700 treasury shares. 96,000 of these shares were sold at $0.35 per share; 142,500 of these shares were sold at $1 per share; and 17,200 shares were sold at $0.50 per share. Additionally, the Company issued 110,000 treasury shares to third parties for services provided during the period ended October 31, 2018. The Company valued these shares using the closing quoted price of the Company’s common stock on the date of issuance. This resulted an increase in the Company’s general and administrative expenses amounting to $49,340 in the first quarter of fiscal year 2019. Of the 255,700 treasury shares sold for cash during the period, 238,500 were yet to be issued as of October 31, 2018 (total value of $176,100).

 

As a result of these transactions, the Company has a balance of 7,191,479 treasury shares as of October 31, 2018.


10


 

 

NOTE 10 –SUBSEQUENT EVENTS

 

On September 11, 2018 the Company entered into a stock purchase agreement with 1stPoint Communications, LLC (the “Seller”) for the purchase of their business.  The acquisition was sought by the Company to complete ownership of key assets to support its hosted wireless services for entry into target markets. 1stPoint owns hosted carrier switching intellectual property for both voice and SMS, CLEC licenses in Florida and New York and a nationwide Commercial Mobile Radio Services license that will allow the company to move forward with its Everything Wireless integrated services strategy as well as hosting services that include cloud computing, virtual servers, virtual desktop and collaboration tools that will be used to advance the Company’s hosted services platform. The managing member of 1stPoint Communications, LLC is the new CEO of Hammer Fiber. Additionally, the agreement contains a buyback provision that expires 180 days from the closing date. The purchase price for all of the Company Units is three million seven hundred and four thousand five hundred and seventeen (3,704,517) shares of the Company’s Common Stock from treasury stock.  Seventy five percent (75%) of the shares of the Company’s 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 November 1, 2018, the Company completed the previously announced purchase of 1stPoint Communications, LLC, whereby the Company acquired all of the outstanding equity ownership interests in 1stPoint Communications (the “Acquisition”).

 

On September 11, 2018 the Company entered into a stock purchase agreement with Shelcomm, Inc. (the “Seller”) for the purchase of their business. Shelcomm offers Pocket Paging, VoIP telephone and messaging solutions that will be used to support the assets acquired by 1stPoint and Endstream and support future Smart City deployments as part of the Company’s Everything Wireless strategy. The Co-Chairman of Shelcomm, Inc. is the new CEO of Hammer Fiber; although, he has no management responsibilities with Shelcomm, Inc. Additionally, the agreement contains a buyback provision that expires 180 days from the closing date. The purchase price for all of the Company Units is one million (1,000,000) shares of the Company’s Common Stock from treasury stock. The shares of the Company’s 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 November 1, 2018, the Company completed the previously announced purchase of Shelcomm, Inc., whereby the Company acquired all of the outstanding equity ownership interests in Shelcomm (the “Acquisition”).  

 

On September 12, 2018 the Company entered into a stock purchase agreement with Open Data Centers, LLC (the “Seller”) for the purchase of their business.  The acquisition was a crucial component of the Company’s future hosted services and wireless services platform.  Open Data Centers operates a brick-and-mortar colocation facility to support the development of new Company infrastructure and provides 24x7 remote network operations to help management the existing assets as well as the newly acquired 1stPoint and Endstream assets. The managing member of Open Data Centers, LLC is the new CEO of Hammer Fiber. Additionally, the agreement contains a buyback provision that expires 180 days from the closing date. 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 Company’s Common Stock from treasury stock.  The shares of the Company’s 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 November 1, 2018, the Company completed the previously announced purchase of Open Data Centers, LLC whereby the Company acquired all of the outstanding equity ownership interests in Open Data Centers (the “Acquisition”).  

 

On September 11, 2018 the Company entered into a stock purchase agreement with Endstream Communications, LLC (the “Seller”) for the purchase of their business.  The acquisition will bring new cash flow to the Company and will support its wireless service strategy through the offering of voice and messaging services.  Endstream offers global VoIP termination, Direct Inbound Calling and Calling Card services which will be utilized by the Company in projects contemplated both in the US and internationally. The managing member of Endstream Communications, LLC is the new CEO of Hammer Fiber. Additionally, the agreement contains a buyback provision that expires 180 days from the closing date. The purchase price for all of the Company Units is one million nine hundred and eighty-eight thousand six hundred and sixteen (1,988,617) shares of the Company’s 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.  Due to control of certain communications licenses by Endstream, pursuant to section 214 of the Communications Act of 1934, Endstream required Commission consent from the Federal Communications Commission (“FCC”) to transfer control of Endstream to the Company.  On November 18, 2018 the FCC approved the transfer of control of Endstream Communications, LLC effective December 17, 2018. The Company and Endstream plan to close the same day.


11


 

 

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

 

The following Management’s Discussion and Analysis should be read in conjunction with Hammer Fiber Optics Holdings Corp. condensed unaudited financial statements and the related notes thereto. The Management’s Discussion and Analysis contains forward- looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These forward-looking statements are not historical facts but rather are based on current expectations, estimates and projections. We may use words such as “anticipate,” “expect,” “intend,” “plan,” “believe,” “foresee,” “estimate” and variations of these words and similar expressions to identify forward-looking statements. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and other factors, some of which are beyond our control, are difficult to predict and could cause actual results to differ materially from those expressed or forecasted. You should read this Report completely and with the understanding that actual future results may be materially different from what we expect. The forward-looking statements included in this Report are made as of the date of this Report and should be evaluated with consideration of any changes occurring after the date of this Report. We will not update forward-looking statements even though our situation may change in the future and we assume no obligation to update any forward- looking statements, whether as a result of new information, future events or otherwise.

 

The following discussion should be read in conjunction with our audited financial statements for the year ended July 31, 2017 and the related notes thereto. The discussions of results, causes and trends should not be construed to imply any conclusion that these results or trends will necessarily continue into the future.

 

Our financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.

 

Results of Operations

 

Three Months Ended October 31, 2018 Compared to the Three Months Ended October 31, 2017

 

Net revenues for the three months ended October 31, 2018 and October 31, 2017 were $47,232 and $37,293, respectively. The Company earned revenues in 2017 as a result of completing the initial portion of its network infrastructure necessary to offer services.

 

During the three months ended October 31, 2018, the Company incurred total operating expenses of $464,680 compared with $2,390,412 for the comparable period ended October 31, 2017. The change in expenses was to due to the fact bad debit was credited for the amount of a previously impaired receivable, a reduction in staff, a reduction in outside support, the completion of market development in New Jersey and reduction of marketing expenses for the period. The Company anticipates operating costs to decrease as a result. The Company also issued 110,000 shares of the Company’s common stock from treasury for services. The Company valued these shares using the closing quoted price of the Company’s common stock on the date of issuance. This resulted an increase in the Company’s general and administrative expenses amounting to $49,340 in the first quarter of fiscal year 2019. The change in operating expenses are due to the reduction of staff and the elimination of certain outside resources.

 

The Company recorded depreciation and amortization expense of $263,397 and $279,036 during the three months ended October 31, 2018 and October 31, 2017, respectively. The decrease was the result of additional capital assets placed into service to further expand the company’s technology platform.

 

During the three months ended October 31, 2018 and October 31, 2017, interest expense was $95,977 and $86,284, respectively. The increase is attributable to an increase in the amount of related-party debt.

 

Liquidity and Capital Resources

 

The Company is at risk of remaining a going concern. Its ability to remain a going concern is dependent upon the ability to raise debt and/or equity capital from third-party sources for both working capital and business development needs until such time as the Company may be substantially sustained as a going concern through cash flow from operations.


12


 

 

Cash Flow from Operating Activities

 

During the three months ended October 31, 2018, the Company used $186,991 in cash for operating activities, compared to $1,278,836 in cash used for operating activities during the comparable 2017 period. The primary reason for this decrease is a reduction of general and administrative expenses that was previously required for the Company to develop operations in the Absecon Island market in New Jersey.

 

Cash Flow from Investing Activities

 

During the three months ended October 31, 2018, the Company’s investing activities consumed no cash, compared to $389,830 for the three months ended October 31, 2017. The primary reason for this decrease was from the completion of infrastructure and equipment expenditures for the development of the New Jersey service market. 

 

Cash Flow from Financing Activities

 

During the three months ended October 31, 2018, the Company netted $184,700 in cash from financing activities compared with the net increase of $1,391,603 during the three months ended October 31, 2017. The change in investing activities is due to a reduction in treasury stock sold to third parties.

 

Going Concern

 

As at October 31, 2018, substantial doubt existed as to the Company’s ability to continue as a going concern as the Company has earned only minimal revenue, has no certainty of earning additional revenues in the future, has a working capital deficit and an overall accumulated deficit since inception. The Company will require additional financing to continue operations either from management, existing shareholders, or new shareholders through equity financing and/or sources of debt financing. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. The financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 

Future Financings

 

We will continue to rely on equity sales of our common shares presently held in Treasury in order to continue to fund business operations. Any issuances of additional shares beyond those shares presently held in Treasury, may result in dilution to existing stockholders. There is no assurance that we will achieve any additional sales of shares held in Treasury or issue additional equity securities or arrange for debt or other financing in amounts sufficient to fund our operations and other development activities.

 

Off-Balance Sheet Arrangements

 

We have no significant 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 stockholders.

 

Critical Accounting Policies

 

Our financial statements and accompanying notes have been prepared in accordance with accounting principles generally accepted in the United States, applied on a consistent basis. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods.

 

Recently Issued Accounting Pronouncements

 

The Company has implemented all new accounting pronouncements that are relevant to the company and are in effect. These pronouncements did not have any material impact on the financial statements unless otherwise disclosed, and the Company does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.


13


 

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Management’s Report on Disclosure Controls and Procedures

 

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed under the Securities Exchange Act of 1934 , as amended, is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, and that such information is accumulated and communicated to our management, including our chief executive officer and our chief financial officer (who is acting as our principal executive officer, principal financial officer and principle accounting officer) to allow for timely decisions regarding required disclosure.

 

As of October 31, 2018, the end of the period covered by this report, we carried out an evaluation, under the supervision of our chief executive officer and executive staff, with the participation of our principal accounting officer, of the effectiveness of the design and operation of our disclosure controls and procedures. The officers concluded that the disclosure controls and procedures were not effective as of the end of the period covered by this report.

 

Management’s Report on Internal Control over Financial Reporting

 

Our management is responsible for establishing and maintaining adequate internal control over financial reporting. Responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of control procedures. The objectives of internal control include providing management with reasonable, but not absolute, assurance that assets are safeguarded against loss from unauthorized use or disposition, and that transactions are executed in accordance with management’s authorization and recorded properly to permit the preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States. Our management assessed the effectiveness of our internal control over financial reporting as of October 31, 2018. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control-Integrated Framework (2013). Our management has concluded that, as of October 31, 2018, our internal control over financial reporting was not effective.

 

Inherent Limitations on Effectiveness of Controls

 

Internal control over financial reporting has inherent limitations which include but is not limited to the use of independent professionals for advice and guidance, interpretation of existing and/or changing rules and principles, segregation of management duties, scale of organization, and personnel factors. Internal control over financial reporting is a process which involves human diligence and compliance and is subject to lapses in judgment and breakdowns resulting from human failures. Internal control over financial reporting also can be circumvented by collusion or improper management override. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements on a timely basis, however these inherent limitations are known features of the financial reporting process and it is possible to design into the process safeguards to reduce, though not eliminate, this risk. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 

Changes in Internal Control over Financial Reporting

 

There have been no changes in our internal controls over financial reporting that occurred during the quarter ended October 31, 2018 that have materially or are reasonably likely to materially affect, our internal controls over financial reporting.


14


 

 

PART II - OTHER INFORMATION

 

ITEM 1. LEGAL PROCEEDINGS

 

From time to time, the Company may become subject to various legal proceedings that are incidental to the ordinary conduct of its business. Although the Company cannot accurately predict the amount of any liability that may ultimately arise with respect to any of these matters, it makes provision for potential liabilities when it deems them probable and reasonably estimable. These provisions are based on current information and legal advice and may be adjusted from time to time according to developments.

 

Presently, we know of no material, existing or pending legal proceedings against our Company, nor are we involved as a plaintiff in any material proceeding or pending litigation. There are no proceedings in which any director, officer or any affiliates, or any registered or beneficial shareholder, is an adverse party or has a material interest adverse to our interest.

 

ITEM 1A. RISK FACTORS

 

We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this item.

 

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

 

There has been no change in our securities since the fiscal year ended July 31, 2018.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

None.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

N/A.

 

ITEM 5. OTHER INFORMATION

 

Please refer to our Current Reports on Form 8-K filed since August 19, 2016, which are incorporated by reference herein.

 

ITEM 6. EXHIBITS

 

Exhibit Number

 

Description of Exhibit

 

31.1

 

Certification of Principal Executive Officer Pursuant to Rule 13a-14

 

Filed herewith.

31.2

 

Certification of Principal Financial Officer Pursuant to Rule 13a-14

 

Filed herewith.

32.1

 

CEO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act

 

Filed herewith.

32.2

 

 

CFO Certification Pursuant to Section 906 of the Sarbanes-Oxley Act

 

Filed herewith.

101.INS*

101.SCH*

101.CAL*

101.LAB*

101.PRE*

101.DEF*

 

XBRL Instance Document

XBRL Taxonomy Extension Schema Document

XBRL Taxonomy Extension Calculation Linkbase Document

XBRL Taxonomy Extension Labels Linkbase Document

XBRL Taxonomy Extension Presentation Linkbase Document

XBRL Taxonomy Extension Definition Linkbase Document

 

Filed herewith. Filed herewith. Filed herewith. Filed herewith. Filed herewith. Filed herewith.

 

Pursuant to Regulation S-T, this interactive data file is deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.


15


 

 

SIGNATURES

 

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

HAMMER FIBER OPTICS HOLDINGS CORP.

 

 

 

Date: December 18, 2018/s/ Mark Stogdill                                                    

Mark Stogdill

Executive Officer and Director

 

 

Date: December 18, 2018/s/ Michael Cothill                                                 

Michael Cothill

Chairman and Principal Financial Officer

 

 

Date: December 18, 2018/s/ Erik B. Levitt                                                     

Erik B. Levitt

Principal Executive Officer


16

EX-31.1 2 f10q103118_ex31z1.htm EXHIBIT 31.1 SECTION 302 CERTIFICATION Exhibit 31.1 Section 302 Certification

 

EXHIBIT 31.1

 

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002

 

I, Erik B. Levitt, certify that:

 

1.I have reviewed this Quarterly Report on Form 10-Q of the Registrant for the period ended October 31, 2018; 

 

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 

 

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report; 

 

4.As the Registrant’s certifying officer, I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have: 

 

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; 

 

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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; 

 

c.Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and 

 

d.Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and 

 

5.As the Registrant’s certifying officer, I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant auditors and the audit committee of the Registrant’s Board of Directors (or persons performing the equivalent functions): 

 

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and 

 

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting. 

 

 

Date: December 18, 2018

 

Hammer Fiber Optics Holdings Corp.

 

 

By: /s/ Erik B. Levitt

Name: Erik B. Levitt

Title: Chief Executive Officer

 

EX-31.2 3 f10q103118_ex31z2.htm EXHIBIT 31.2 SECTION 302 CERTIFICATION Exhibit 31.2 Section 302 Certification

 

EXHIBIT 31.2

 

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO SECTION 302(a) OF THE SARBANES-OXLEY ACT OF 2002

 

I, Michael Cothill, certify that:

 

1.I have reviewed this Quarterly Report on Form 10-Q of the Registrant for the period ended October 31, 2018; 

 

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 

 

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report; 

 

4.As the Registrant’s certifying officer, I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have: 

 

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; 

 

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, 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; 

 

c.Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and 

 

d.Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and 

 

5.As the Registrant’s certifying officer, I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant auditors and the audit committee of the Registrant’s Board of Directors (or persons performing the equivalent functions): 

 

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and 

 

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting. 

 

 

Date: December 18, 2018

 

Hammer Fiber Optics Holdings Corp.

 

 

By: /s/ Michael Cothill

Name: Michael Cothill

Title: Chief Accounting and Financial Officer

 

EX-32.1 4 f10q103118_ex32z1.htm EXHIBIT 32.1 SECTION 906 CERTIFICATION Exhibit 32.1 Section 906 Certification

 

EXHIBIT 32.1

 

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Erik B. Levitt, the Chief Executive Officer of Hammer Fiber Optics Holdings Corp., certify, under the standards set forth and solely for the purposes of 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge, the Quarterly Report on Form 10-Q of the Registrant for the period ended October 31, 2018, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in that Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

 

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and 

 

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant. 

 

 

Date: December 18, 2018

 

Hammer Fiber Optics Holdings Corp.

 

 

By: /s/ Erik B. Levitt

Name: Erik B. Levitt

Title: Chief Executive Officer

 

 

A signed original of this written statement required by Section 906 has been provided to the Registrant and will be retained by the Registrant and furnished to the Securities and Exchange Commission or its staff upon request.

 

EX-32.2 5 f10q103118_ex32z2.htm EXHIBIT 32.2 SECTION 906 CERTIFICATION Exhibit 32.2 Section 906 Certification

 

EXHIBIT 32.2

 

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Michael Cothill, the Chief Accounting and Financial Officer of Hammer Fiber Optics Holdings Corp., certify, under the standards set forth and solely for the purposes of 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge, the Quarterly Report on Form 10-Q of the Registrant for the period ended October 31, 2018, fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in that Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Registrant.

 

1.The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and 

 

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant. 

 

Date: December 18, 2018

 

Hammer Fiber Optics Holdings Corp.

 

 

By: /s/ Michael Cothill

Name: Michael Cothill

Title: Chief Accounting and Financial Officer

 

 

A signed original of this written statement required by Section 906 has been provided to the Registrant and will be retained by the Registrant and furnished to the Securities and Exchange Commission or its staff upon request.


EX-101.CAL 6 hmmr-20181031_cal.xml XBRL TAXONOMY EXTENSION CALCULATION LINKBASE DOCUMENT EX-101.DEF 7 hmmr-20181031_def.xml XBRL TAXONOMY EXTENSION DEFINITION LINKBASE DOCUMENT EX-101.INS 8 hmmr-20181031.xml XBRL INSTANCE DOCUMENT 0001539680 10-Q 2018-10-31 --07-31 hmmr Non-accelerated Filer Yes true true false false 2019 Q1 000-1539680 HAMMER FIBER OPTICS HOLDINGS CORP 981032170 15 Corporate Place South, Suite 100 Piscataway NJ 08854 Address of principal executive offices 844 413-2600 Registrant&#146;s telephone number, including area code 60503341 0.001 53135762 22185 19332 4829 9488 28164 32261 4330238 18934 11310 11310 4360482 4623879 4388646 4656140 174710 256243 230000 230000 3394067 3394067 382474 289050 4181251 4169360 4181251 4169360 0.001 0.001 250000000 250000000 60503341 60503341 52946162 52946162 60503 60503 0 0 0 14675659 14617719 -14704867 -14191442 207395 486780 4388646 4656140 47232 37293 5597 2207 195686 2109169 464680 2390412 -417448 -2353119 95977 86284 0 1765 -95977 -84519 -513425 -2437638 53031038 52180159 -0.01 -0.05 -513425 -2437638 49340 943500 2853 7565 -4659 -11617 -81533 -80293 93424 12507 -186991 -1278836 0 389830 0 6905 184700 1398508 184700 1391603 -2291 -277063 3441 528380 1150 251317 2553 75000 5774 0 <p style='margin:0in;margin-bottom:.0001pt'><b>NOTE<font style='letter-spacing:.35pt'> </font>1<font style='letter-spacing:.4pt'> </font>&#150;<font style='letter-spacing:.35pt'> </font>ORGANIZ<font style='letter-spacing:-.75pt'>A</font>TION<font style='letter-spacing:.4pt'> </font>AND<font style='letter-spacing:.35pt'> </font>DESCRIPTION<font style='letter-spacing:.4pt'> </font>OF<font style='letter-spacing:-.05pt'> </font>BUSINESS</b></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Hammer<font style='letter-spacing:1.65pt'> </font>Fiber<font style='letter-spacing:1.65pt'> </font>Optics<font style='letter-spacing:1.65pt'> </font>Holdings<font style='letter-spacing:1.65pt'> </font>Corp.<font style='letter-spacing:1.65pt'> </font>(&#147;the<font style='letter-spacing:1.65pt'> </font>Company&#148;)<font style='letter-spacing:1.65pt'> </font>is<font style='letter-spacing:1.65pt'> </font>an<font style='letter-spacing:1.65pt'> </font>alternative<font style='letter-spacing:1.65pt'> </font>telecommunications<font style='letter-spacing:1.65pt'> </font>carrier<font style='letter-spacing:1.65pt'> </font>formed<font style='letter-spacing:1.65pt'> </font>to<font style='letter-spacing:1.65pt'> </font>provide<font style='letter-spacing:1.65pt'> </font>high<font style='letter-spacing:1.65pt'> </font>capacity broadband<font style='letter-spacing:1.85pt'> </font>through<font style='letter-spacing:1.85pt'> </font>a<font style='letter-spacing:1.9pt'> </font>wireless<font style='letter-spacing:1.85pt'> </font>access<font style='letter-spacing:1.85pt'> </font>network.<font style='letter-spacing:1.9pt'> </font>Hammer<font style='letter-spacing:1.85pt'> </font>Fiber<font style='letter-spacing:1.85pt'> </font>Optics<font style='letter-spacing:1.9pt'> </font>Holdings<font style='letter-spacing:1.85pt'> </font>Corp.<font style='letter-spacing:1.85pt'> </font>is<font style='letter-spacing:1.9pt'> </font>the<font style='letter-spacing:1.85pt'> </font>parent<font style='letter-spacing:1.85pt'> </font>company<font style='letter-spacing:1.9pt'> </font>and<font style='letter-spacing:1.85pt'> </font>sole<font style='letter-spacing:1.85pt'> </font>shareholder<font style='letter-spacing:1.9pt'> </font>of Hammer<font style='letter-spacing:1.05pt'> </font><font style='letter-spacing:-.4pt'>W</font>ireless<font style='letter-spacing:1.1pt'> </font>Corporation and Hammer Fiber Optic Investments Ltd. The<font style='letter-spacing:1.1pt'> </font>financial<font style='letter-spacing:1.1pt'> </font>statements<font style='letter-spacing:1.05pt'> </font>for<font style='letter-spacing:1.1pt'> </font>Hammer<font style='letter-spacing:1.1pt'> </font>Fiber<font style='letter-spacing:1.05pt'> </font>Optics<font style='letter-spacing:1.1pt'> </font>Holdings<font style='letter-spacing:1.1pt'> </font>Corp.<font style='letter-spacing:1.05pt'> </font>and<font style='letter-spacing:1.1pt'> </font>its<font style='letter-spacing:1.1pt'> </font>wholly-owned<font style='letter-spacing:1.05pt'> </font>subsidiary<font style='letter-spacing:1.1pt'> </font>are reported<font style='letter-spacing:.3pt'> </font>on<font style='letter-spacing:.3pt'> </font>a<font style='letter-spacing:.3pt'> </font>consolidated<font style='letter-spacing:.3pt'> </font>basis.<font style='letter-spacing:.3pt'> </font>All<font style='letter-spacing:.3pt'> </font>significant<font style='letter-spacing:.3pt'> </font>intercompany<font style='letter-spacing:.3pt'> </font>accounts<font style='letter-spacing:.3pt'> </font>and<font style='letter-spacing:.3pt'> </font>transactions<font style='letter-spacing:.3pt'> </font>have<font style='letter-spacing:.3pt'> </font>been<font style='letter-spacing:.3pt'> </font>eliminated.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'><b>NOTE 2 &#150; CORPORATE HISTORY AND BACKGROUND ON MERGER</b></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>The Company was originally incorporated in the State of </font><font style='line-height:108%'>Nevada</font><font style='line-height:108%'> on </font><font style='line-height:108%'>September 23, 2010</font><font style='line-height:108%'>, under the name </font><font style='line-height:108%'>Recursos Montana S.A.</font><font style='line-height:108%'> The Company&#146;s principal activity was an exploration stage company engaged in the acquisition of mineral properties then owned by the Company.</font></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>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 Company&#146;s 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.</font></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>On April 25, 2016, Tanaris Power Holdings, Inc., a Nevada corporation entered into s Share Exchange Agreement (the &#147;Share Exchange Agreement&#148;) with Hammer Fiber Optics Investments, Ltd., a Delaware corporation (&#147;HFOI&#148;), and the controlling stockholders of HFOI (the &#147;HFOI Shareholders&#148;). Pursuant to the Share Exchange Agreement, the Company acquired 20,000,000 shares of common stock of HFOI from the HFOI shareholders (the &#147;HFOI Shares&#148;) and in exchange, the Company issued to the HFOI Shareholders 50,000,000 (post-Merger) restricted shares of its common stock (the &#147;HMMR Shares&#148;). As a result of the Share Exchange Agreement, HFOI shall become a wholly owned subsidiary of the Company.</font></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>On April 13, 2016, the Board of Directors (BOD) approved a Plan of Merger (the &#147;Plan of Merger&#148;) under Nevada Revised Statuses (NRS) Section 92A.180 to merge (the &#147;Merger&#148;) 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 provides 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 &#147;FINRA&#148;) for its review and approval.</font></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;text-align:justify;line-height:108%'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>On May 3, 2016, the FINRA approved the merger with the wholly-owned subsidiary, HMMR Fiber Optics Holdings Corp. (&#147;HFO Holdings&#148;). Accordingly, thereafter, the Company&#146;s name was changed and the shares of common stock began trading under new ticker symbol &#147;HMMR&#148; as of May 27, 2016. The merger was effected on July 19, 2016.</p> Nevada 2010-09-23 Recursos Montana S.A. <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'><b>NOTE 3 &#150; SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES</b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Basis<font style='letter-spacing:.35pt'> </font>of<font style='letter-spacing:.4pt'> </font>presentation</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:1.95pt'> </font>accompanying<font style='letter-spacing:1.95pt'> </font>consolidated<font style='letter-spacing:2.0pt'> </font>financial<font style='letter-spacing:1.95pt'> </font>statements<font style='letter-spacing:2.0pt'> </font>and<font style='letter-spacing:1.95pt'> </font>related<font style='letter-spacing:2.0pt'> </font>notes<font style='letter-spacing:1.95pt'> </font>have<font style='letter-spacing:2.0pt'> </font>been<font style='letter-spacing:1.95pt'> </font>prepared<font style='letter-spacing:2.0pt'> </font>in<font style='letter-spacing:1.95pt'> </font>accordance<font style='letter-spacing:2.0pt'> </font>with<font style='letter-spacing:1.95pt'> </font>accounting<font style='letter-spacing:1.95pt'> </font>principles generally<font style='letter-spacing:.25pt'> </font>accepted<font style='letter-spacing:.25pt'> </font>in<font style='letter-spacing:.25pt'> </font>the<font style='letter-spacing:.3pt'> </font>United<font style='letter-spacing:.25pt'> </font>States<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.25pt'> </font>America<font style='letter-spacing:.3pt'> </font>(&#147;U.S.<font style='letter-spacing:.25pt'> </font>GAAP&#148;). The<font style='letter-spacing:.65pt'> </font>interim<font style='letter-spacing:.7pt'> </font>financial<font style='letter-spacing:.7pt'> </font>statements<font style='letter-spacing:.65pt'> </font>for<font style='letter-spacing:.7pt'> </font>the<font style='letter-spacing:.7pt'> </font>fiscal<font style='letter-spacing:.65pt'> </font>quarter<font style='letter-spacing:.7pt'> </font>ending<font style='letter-spacing:.7pt'> October 31</font>,<font style='letter-spacing:.7pt'> </font>2018<font style='letter-spacing:.7pt'> </font>are<font style='letter-spacing:.65pt'> </font>unaudited.<font style='letter-spacing:.7pt'> </font>These<font style='letter-spacing:.7pt'> </font>financial<font style='letter-spacing:.7pt'> </font>statements<font style='letter-spacing:.65pt'> </font>are<font style='letter-spacing:.7pt'> </font>prepared<font style='letter-spacing:.7pt'> </font>in accordance<font style='letter-spacing:.7pt'> </font>with<font style='letter-spacing:.7pt'> </font>requirements<font style='letter-spacing:.7pt'> </font>for<font style='letter-spacing:.7pt'> </font>unaudited<font style='letter-spacing:.7pt'> </font>interim<font style='letter-spacing:.7pt'> </font>periods<font style='letter-spacing:.7pt'> </font>and<font style='letter-spacing:.7pt'> </font>consequently<font style='letter-spacing:.7pt'> </font>do<font style='letter-spacing:.7pt'> </font>not<font style='letter-spacing:.7pt'> </font>include<font style='letter-spacing:.7pt'> </font>all<font style='letter-spacing:.7pt'> </font>disclosures<font style='letter-spacing:.7pt'> </font>required<font style='letter-spacing:.7pt'> </font>to<font style='letter-spacing:.7pt'> </font>be<font style='letter-spacing:.7pt'> </font>in<font style='letter-spacing:.7pt'> </font>conformity with<font style='letter-spacing:.95pt'> </font>accounting<font style='letter-spacing:.95pt'> </font>principles<font style='letter-spacing:1.0pt'> </font>generally<font style='letter-spacing:.95pt'> </font>accepted<font style='letter-spacing:1.0pt'> </font>in<font style='letter-spacing:.95pt'> </font>the<font style='letter-spacing:.95pt'> </font>United<font style='letter-spacing:1.0pt'> </font>States<font style='letter-spacing:.95pt'> </font>of<font style='letter-spacing:1.0pt'> </font>America.<font style='letter-spacing:.95pt'> </font>The<font style='letter-spacing:.95pt'> </font>results<font style='letter-spacing:1.0pt'> </font>of<font style='letter-spacing:.95pt'> </font>operations<font style='letter-spacing:1.0pt'> </font>for<font style='letter-spacing:.95pt'> </font>the<font style='letter-spacing:1.0pt'> </font>interim<font style='letter-spacing:.95pt'> </font>periods<font style='letter-spacing:.95pt'> </font>are<font style='letter-spacing:1.0pt'> </font>not necessarily<font style='letter-spacing:1.3pt'> </font>indicative<font style='letter-spacing:1.3pt'> </font>of<font style='letter-spacing:1.35pt'> </font>the<font style='letter-spacing:1.3pt'> </font>results<font style='letter-spacing:1.35pt'> </font>for<font style='letter-spacing:1.3pt'> </font>the<font style='letter-spacing:1.3pt'> </font>full<font style='letter-spacing:1.35pt'> </font>yea<font style='letter-spacing:-.55pt'>r</font>.<font style='letter-spacing:1.3pt'> </font>In<font style='letter-spacing:1.35pt'> </font>management's<font style='letter-spacing:1.3pt'> </font>opinion,<font style='letter-spacing:1.3pt'> </font>all<font style='letter-spacing:1.35pt'> </font>adjustments<font style='letter-spacing:1.3pt'> </font>necessary<font style='letter-spacing:1.35pt'> </font>for<font style='letter-spacing:1.3pt'> </font>a<font style='letter-spacing:1.3pt'> </font>fair<font style='letter-spacing:1.35pt'> </font>presentation<font style='letter-spacing:1.3pt'> </font>of<font style='letter-spacing:1.35pt'> </font>the Company's<font style='letter-spacing:.35pt'> </font>financial<font style='letter-spacing:.4pt'> </font>statements<font style='letter-spacing:.4pt'> </font>are<font style='letter-spacing:.35pt'> </font>reflected<font style='letter-spacing:.4pt'> </font>in<font style='letter-spacing:.4pt'> </font>the<font style='letter-spacing:.4pt'> </font>interim<font style='letter-spacing:.35pt'> </font>periods<font style='letter-spacing:.4pt'> </font>included and<font style='letter-spacing:.4pt'> </font>are<font style='letter-spacing:.35pt'> </font>of<font style='letter-spacing:.4pt'> </font>a<font style='letter-spacing:.4pt'> </font>normal<font style='letter-spacing:.4pt'> </font>recurring<font style='letter-spacing:.35pt'> </font>nature.<font style='letter-spacing:.4pt'> </font>These<font style='letter-spacing:.4pt'> </font>interim<font style='letter-spacing:.4pt'> </font>financial statements<font style='letter-spacing:.85pt'> </font>should<font style='letter-spacing:.9pt'> </font>be<font style='letter-spacing:.9pt'> </font>read<font style='letter-spacing:.9pt'> </font>in<font style='letter-spacing:.9pt'> </font>conjunction<font style='letter-spacing:.9pt'> </font>with<font style='letter-spacing:.9pt'> </font>the<font style='letter-spacing:.9pt'> </font>financial<font style='letter-spacing:.9pt'> </font>statements<font style='letter-spacing:.9pt'> </font>included<font style='letter-spacing:.9pt'> </font>in<font style='letter-spacing:.9pt'> </font>our<font style='letter-spacing:.9pt'> </font>Form<font style='letter-spacing:.9pt'> </font>10-K,<font style='letter-spacing:.9pt'> </font>for<font style='letter-spacing:.9pt'> </font>the<font style='letter-spacing:.9pt'> </font>year<font style='letter-spacing:.9pt'> </font>ended<font style='letter-spacing:.9pt'> </font>July<font style='letter-spacing:.9pt'> </font>31,<font style='letter-spacing:.9pt'> </font>2018,<font style='letter-spacing:.9pt'> </font>as filed<font style='letter-spacing:.25pt'> </font>with<font style='letter-spacing:.3pt'> </font>the<font style='letter-spacing:.3pt'> </font>Securities<font style='letter-spacing:.3pt'> </font>and<font style='letter-spacing:.25pt'> </font>Exchange<font style='letter-spacing:.3pt'> </font>Commission<font style='letter-spacing:.3pt'> </font>(&#147;the<font style='letter-spacing:.25pt'> </font>SEC&#148;)<font style='letter-spacing:.3pt'> </font>at<font style='letter-spacing:.3pt'> </font>ww<font style='letter-spacing:-.65pt'>w</font>.sec.go<font style='letter-spacing:-.65pt'>v</font>.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Use of estimates</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:.35pt'> </font>preparation<font style='letter-spacing:.35pt'> </font>of<font style='letter-spacing:.35pt'> </font>financial<font style='letter-spacing:.35pt'> </font>statements<font style='letter-spacing:.35pt'> </font>in<font style='letter-spacing:.35pt'> </font>conformity<font style='letter-spacing:.35pt'> </font>with<font style='letter-spacing:.35pt'> </font>GAAP<font style='letter-spacing:-.05pt'> </font>requires<font style='letter-spacing:.35pt'> </font>management<font style='letter-spacing:.35pt'> </font>to<font style='letter-spacing:.35pt'> </font>make<font style='letter-spacing:.35pt'> </font>estimates<font style='letter-spacing:.35pt'> </font>and<font style='letter-spacing:.35pt'> </font>assumptions<font style='letter-spacing:.35pt'> </font>that<font style='letter-spacing:.35pt'> </font>a<font style='letter-spacing:-.2pt'>f</font>fect<font style='letter-spacing:.35pt'> </font>the reported<font style='letter-spacing:.65pt'> </font>amounts<font style='letter-spacing:.65pt'> </font>of<font style='letter-spacing:.65pt'> </font>assets<font style='letter-spacing:.65pt'> </font>and<font style='letter-spacing:.7pt'> </font>liabilities<font style='letter-spacing:.65pt'> </font>and<font style='letter-spacing:.65pt'> </font>disclosure<font style='letter-spacing:.65pt'> </font>of<font style='letter-spacing:.65pt'> </font>contingent<font style='letter-spacing:.7pt'> </font>assets<font style='letter-spacing:.65pt'> </font>and<font style='letter-spacing:.65pt'> </font>liabilities<font style='letter-spacing:.65pt'> </font>at<font style='letter-spacing:.65pt'> </font>the<font style='letter-spacing:.7pt'> </font>date<font style='letter-spacing:.65pt'> </font>of<font style='letter-spacing:.65pt'> </font>the<font style='letter-spacing:.65pt'> </font>financial<font style='letter-spacing:.65pt'> </font>statements<font style='letter-spacing:.7pt'> </font>and<font style='letter-spacing:.65pt'> </font>the reported<font style='letter-spacing:.25pt'> </font>amount<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.25pt'> </font>revenues<font style='letter-spacing:.25pt'> </font>and<font style='letter-spacing:.3pt'> </font>expenses<font style='letter-spacing:.25pt'> </font>during<font style='letter-spacing:.25pt'> </font>the<font style='letter-spacing:.25pt'> </font>reporting<font style='letter-spacing:.25pt'> </font>period.<font style='letter-spacing:.3pt'> </font>Actual<font style='letter-spacing:.25pt'> </font>results<font style='letter-spacing:.25pt'> </font>could<font style='letter-spacing:.25pt'> </font>di<font style='letter-spacing:-.2pt'>f</font>fer<font style='letter-spacing:.25pt'> </font>from<font style='letter-spacing:.3pt'> </font>those<font style='letter-spacing:.25pt'> </font>estimates.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Cash and cash equivalents</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Cash<font style='letter-spacing:.55pt'> </font>and<font style='letter-spacing:.55pt'> </font>cash<font style='letter-spacing:.55pt'> </font>equivalents<font style='letter-spacing:.6pt'> </font>include<font style='letter-spacing:.55pt'> </font>cash<font style='letter-spacing:.55pt'> </font>in<font style='letter-spacing:.55pt'> </font>banks,<font style='letter-spacing:.6pt'> </font>money<font style='letter-spacing:.55pt'> </font>market<font style='letter-spacing:.55pt'> </font>funds,<font style='letter-spacing:.55pt'> </font>and<font style='letter-spacing:.6pt'> </font>certificates<font style='letter-spacing:.55pt'> </font>of<font style='letter-spacing:.55pt'> </font>term<font style='letter-spacing:.55pt'> </font>deposits<font style='letter-spacing:.6pt'> </font>with<font style='letter-spacing:.55pt'> </font>maturities<font style='letter-spacing:.55pt'> </font>of<font style='letter-spacing:.55pt'> </font>less<font style='letter-spacing:.6pt'> </font>than<font style='letter-spacing:.55pt'> </font>three months<font style='letter-spacing:.5pt'> </font>from<font style='letter-spacing:.5pt'> </font>inception,<font style='letter-spacing:.5pt'> </font>which<font style='letter-spacing:.5pt'> </font>are<font style='letter-spacing:.55pt'> </font>readily<font style='letter-spacing:.5pt'> </font>convertible<font style='letter-spacing:.5pt'> </font>to<font style='letter-spacing:.5pt'> </font>known<font style='letter-spacing:.55pt'> </font>amounts<font style='letter-spacing:.5pt'> </font>of<font style='letter-spacing:.5pt'> </font>cash<font style='letter-spacing:.5pt'> </font>and<font style='letter-spacing:.55pt'> </font>which,<font style='letter-spacing:.5pt'> </font>in<font style='letter-spacing:.5pt'> </font>the<font style='letter-spacing:.5pt'> </font>opinion<font style='letter-spacing:.55pt'> </font>of<font style='letter-spacing:.5pt'> </font>management,<font style='letter-spacing:.5pt'> </font>are<font style='letter-spacing:.5pt'> </font>subject<font style='letter-spacing:.55pt'> </font>to an<font style='letter-spacing:.2pt'> </font>insignificant<font style='letter-spacing:.2pt'> </font>risk<font style='letter-spacing:.2pt'> </font>of<font style='letter-spacing:.2pt'> </font>loss<font style='letter-spacing:.2pt'> </font>in<font style='letter-spacing:.2pt'> </font>value.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Property and equipment</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Property<font style='letter-spacing:1.55pt'> </font>and<font style='letter-spacing:1.55pt'> </font>equipment<font style='letter-spacing:1.55pt'> </font>is<font style='letter-spacing:1.55pt'> </font>stated<font style='letter-spacing:1.55pt'> </font>at<font style='letter-spacing:1.55pt'> </font>cost<font style='letter-spacing:1.55pt'> </font>less<font style='letter-spacing:1.55pt'> </font>accumulated<font style='letter-spacing:1.55pt'> </font>depreciation.<font style='letter-spacing:1.55pt'> </font>Depreciation<font style='letter-spacing:1.55pt'> </font>is<font style='letter-spacing:1.55pt'> </font>provided<font style='letter-spacing:1.6pt'> </font>for<font style='letter-spacing:1.55pt'> </font>on<font style='letter-spacing:1.55pt'> </font>a<font style='letter-spacing:1.55pt'> </font>straight-line<font style='letter-spacing:1.55pt'> </font>basis<font style='letter-spacing:1.55pt'> </font>over<font style='letter-spacing:1.55pt'> </font>the useful<font style='letter-spacing:.85pt'> </font>lives<font style='letter-spacing:.85pt'> </font>of<font style='letter-spacing:.85pt'> </font>the<font style='letter-spacing:.85pt'> </font>assets. For network service equipment, and furniture and fixtures, the useful life is ten and five years, respectively. Leasehold<font style='letter-spacing:.9pt'> </font>Improvements<font style='letter-spacing:.85pt'> </font>are<font style='letter-spacing:.85pt'> </font>depreciated<font style='letter-spacing:.85pt'> </font>over<font style='letter-spacing:.85pt'> </font>six years.<font style='letter-spacing:.25pt'> </font>Expenditures<font style='letter-spacing:.3pt'> </font>for<font style='letter-spacing:.3pt'> </font>additions<font style='letter-spacing:.25pt'> </font>and<font style='letter-spacing:.3pt'> </font>improvements<font style='letter-spacing:.3pt'> </font>are<font style='letter-spacing:.25pt'> </font>capitalized;<font style='letter-spacing:.3pt'> </font>repairs<font style='letter-spacing:.3pt'> </font>and<font style='letter-spacing:.25pt'> </font>maintenance<font style='letter-spacing:.3pt'> </font>are<font style='letter-spacing:.25pt'> </font>expensed<font style='letter-spacing:.3pt'> </font>as<font style='letter-spacing:.3pt'> </font>incurred.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Impairment of long-lived assets</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:.6pt'> </font>Company<font style='letter-spacing:.6pt'> </font>evaluates<font style='letter-spacing:.6pt'> </font>long-lived<font style='letter-spacing:.65pt'> </font>assets<font style='letter-spacing:.6pt'> </font>for<font style='letter-spacing:.6pt'> </font>impairment<font style='letter-spacing:.65pt'> </font>whenever<font style='letter-spacing:.6pt'> </font>events<font style='letter-spacing:.6pt'> </font>or<font style='letter-spacing:.6pt'> </font>changes<font style='letter-spacing:.65pt'> </font>in<font style='letter-spacing:.6pt'> </font>circumstances<font style='letter-spacing:.6pt'> </font>indicate<font style='letter-spacing:.65pt'> </font>that<font style='letter-spacing:.6pt'> </font>the<font style='letter-spacing:.6pt'> </font>carrying<font style='letter-spacing:.6pt'> </font>amount of<font style='letter-spacing:.65pt'> </font>an<font style='letter-spacing:.7pt'> </font>asset<font style='letter-spacing:.65pt'> </font>may<font style='letter-spacing:.7pt'> </font>not<font style='letter-spacing:.7pt'> </font>be<font style='letter-spacing:.65pt'> </font>recoverable.<font style='letter-spacing:.7pt'> </font>Recoverability<font style='letter-spacing:.7pt'> </font>of<font style='letter-spacing:.65pt'> </font>assets<font style='letter-spacing:.7pt'> </font>to<font style='letter-spacing:.7pt'> </font>be<font style='letter-spacing:.65pt'> </font>held<font style='letter-spacing:.7pt'> </font>and<font style='letter-spacing:.7pt'> </font>used<font style='letter-spacing:.65pt'> </font>is<font style='letter-spacing:.7pt'> </font>measured<font style='letter-spacing:.7pt'> </font>by<font style='letter-spacing:.65pt'> </font>a<font style='letter-spacing:.7pt'> </font>comparison<font style='letter-spacing:.65pt'> </font>of<font style='letter-spacing:.7pt'> </font>the<font style='letter-spacing:.7pt'> </font>carrying<font style='letter-spacing:.65pt'> </font>amount<font style='letter-spacing:.7pt'> </font>of the<font style='letter-spacing:.6pt'> </font>assets<font style='letter-spacing:.65pt'> </font>to<font style='letter-spacing:.65pt'> </font>future<font style='letter-spacing:.65pt'> </font>undiscounted<font style='letter-spacing:.65pt'> </font>cash<font style='letter-spacing:.6pt'> </font>flows<font style='letter-spacing:.65pt'> </font>to<font style='letter-spacing:.65pt'> </font>be<font style='letter-spacing:.65pt'> </font>generated<font style='letter-spacing:.65pt'> </font>by<font style='letter-spacing:.65pt'> </font>the<font style='letter-spacing:.6pt'> </font>asset.<font style='letter-spacing:.65pt'> </font>If<font style='letter-spacing:.65pt'> </font>such<font style='letter-spacing:.65pt'> </font>assets<font style='letter-spacing:.65pt'> </font>are<font style='letter-spacing:.65pt'> </font>considered<font style='letter-spacing:.6pt'> </font>to<font style='letter-spacing:.65pt'> </font>be<font style='letter-spacing:.65pt'> </font>impaired,<font style='letter-spacing:.65pt'> </font>the<font style='letter-spacing:.65pt'> </font>impairment<font style='letter-spacing:.65pt'> </font>to be<font style='letter-spacing:.75pt'> </font>recognized<font style='letter-spacing:.8pt'> </font>is<font style='letter-spacing:.8pt'> </font>measured<font style='letter-spacing:.8pt'> </font>as<font style='letter-spacing:.8pt'> </font>the<font style='letter-spacing:.8pt'> </font>amount<font style='letter-spacing:.75pt'> </font>by<font style='letter-spacing:.8pt'> </font>which<font style='letter-spacing:.8pt'> </font>the<font style='letter-spacing:.8pt'> </font>carrying<font style='letter-spacing:.8pt'> </font>amount<font style='letter-spacing:.8pt'> </font>of<font style='letter-spacing:.75pt'> </font>the<font style='letter-spacing:.8pt'> </font>assets<font style='letter-spacing:.8pt'> </font>exceeds<font style='letter-spacing:.8pt'> </font>the<font style='letter-spacing:.8pt'> </font>fair<font style='letter-spacing:.8pt'> </font>value<font style='letter-spacing:.8pt'> </font>of<font style='letter-spacing:.75pt'> </font>the<font style='letter-spacing:.8pt'> </font>assets.<font style='letter-spacing:.8pt'> </font>The<font style='letter-spacing:.8pt'> </font>Company has<font style='letter-spacing:.3pt'> </font>not<font style='letter-spacing:.35pt'> </font>recognized<font style='letter-spacing:.35pt'> </font>impairment<font style='letter-spacing:.35pt'> </font>losses.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Indefinite lived intangible assets</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>The<font style='letter-spacing:1.1pt'> </font>Company<font style='letter-spacing:1.1pt'> </font>reviews<font style='letter-spacing:1.15pt'> </font>propert<font style='letter-spacing:-.65pt'>y</font>,<font style='letter-spacing:1.1pt'> </font>plant<font style='letter-spacing:1.15pt'> </font>and<font style='letter-spacing:1.1pt'> </font>equipment,<font style='letter-spacing:1.1pt'> </font>inventory<font style='letter-spacing:1.15pt'> </font>component<font style='letter-spacing:1.1pt'> </font>prepayments<font style='letter-spacing:1.15pt'> </font>and<font style='letter-spacing:1.1pt'> </font>certain<font style='letter-spacing:1.15pt'> </font>identifiable<font style='letter-spacing:1.1pt'> </font>intangibles,<font style='letter-spacing:1.1pt'> </font>excluding goodwill,<font style='letter-spacing:1.95pt'> </font>for<font style='letter-spacing:1.9pt'> </font>impairment.<font style='letter-spacing:1.95pt'> </font>Long-lived<font style='letter-spacing:1.95pt'> </font>assets<font style='letter-spacing:1.95pt'> </font>are<font style='letter-spacing:1.95pt'> </font>reviewed<font style='letter-spacing:1.95pt'> </font>for<font style='letter-spacing:1.95pt'> </font>impairment<font style='letter-spacing:1.95pt'> </font>whenever<font style='letter-spacing:1.95pt'> </font>events<font style='letter-spacing:1.95pt'> </font>or<font style='letter-spacing:1.95pt'> </font>changes<font style='letter-spacing:1.95pt'> </font>in<font style='letter-spacing:1.95pt'> </font>circumstances<font style='letter-spacing:1.95pt'> </font>indicate<font style='letter-spacing:1.95pt'> </font>the carrying<font style='letter-spacing:.6pt'> </font>amount<font style='letter-spacing:.6pt'> </font>of<font style='letter-spacing:.65pt'> </font>an<font style='letter-spacing:.6pt'> </font>asset<font style='letter-spacing:.65pt'> </font>may<font style='letter-spacing:.6pt'> </font>not<font style='letter-spacing:.65pt'> </font>be<font style='letter-spacing:.6pt'> </font>recoverable.<font style='letter-spacing:.65pt'> </font>Recoverability<font style='letter-spacing:.6pt'> </font>of<font style='letter-spacing:.6pt'> </font>these<font style='letter-spacing:.65pt'> </font>assets<font style='letter-spacing:.6pt'> </font>is<font style='letter-spacing:.65pt'> </font>measured<font style='letter-spacing:.6pt'> </font>by<font style='letter-spacing:.65pt'> </font>comparison<font style='letter-spacing:.6pt'> </font>of<font style='letter-spacing:.65pt'> </font>their<font style='letter-spacing:.6pt'> </font>carrying<font style='letter-spacing:.6pt'> </font>amounts to<font style='letter-spacing:.25pt'> </font>future<font style='letter-spacing:.3pt'> </font>undiscounted<font style='letter-spacing:.3pt'> </font>cash<font style='letter-spacing:.3pt'> </font>flows<font style='letter-spacing:.3pt'> </font>the<font style='letter-spacing:.3pt'> </font>assets<font style='letter-spacing:.3pt'> </font>are<font style='letter-spacing:.3pt'> </font>expected<font style='letter-spacing:.3pt'> </font>to<font style='letter-spacing:.3pt'> </font>generate.<font style='letter-spacing:.3pt'> </font>If<font style='letter-spacing:.3pt'> </font>propert<font style='letter-spacing:-.65pt'>y</font>,<font style='letter-spacing:.3pt'> </font>plant<font style='letter-spacing:.3pt'> </font>and<font style='letter-spacing:.3pt'> </font>equipment,<font style='letter-spacing:.3pt'> </font>inventory<font style='letter-spacing:.3pt'> </font>component<font style='letter-spacing:.3pt'> </font>prepayments and<font style='letter-spacing:1.8pt'> </font>certain<font style='letter-spacing:1.8pt'> </font>identifiable<font style='letter-spacing:1.8pt'> </font>intangibles<font style='letter-spacing:1.8pt'> </font>are<font style='letter-spacing:1.8pt'> </font>considered<font style='letter-spacing:1.8pt'> </font>to<font style='letter-spacing:1.8pt'> </font>be<font style='letter-spacing:1.8pt'> </font>impaired,<font style='letter-spacing:1.8pt'> </font>the<font style='letter-spacing:1.8pt'> </font>impairment<font style='letter-spacing:1.8pt'> </font>to<font style='letter-spacing:1.8pt'> </font>be<font style='letter-spacing:1.85pt'> </font>recognized<font style='letter-spacing:1.8pt'> </font>equals<font style='letter-spacing:1.8pt'> </font>the<font style='letter-spacing:1.8pt'> </font>amount<font style='letter-spacing:1.8pt'> </font>by<font style='letter-spacing:1.8pt'> </font>which<font style='letter-spacing:1.8pt'> </font>the carrying<font style='letter-spacing:.2pt'> </font>value<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.2pt'> </font>the<font style='letter-spacing:.25pt'> </font>assets<font style='letter-spacing:.2pt'> </font>exceeds<font style='letter-spacing:.25pt'> </font>its<font style='letter-spacing:.2pt'> </font>fair<font style='letter-spacing:.25pt'> </font>value.<font style='letter-spacing:.25pt'> </font>The<font style='letter-spacing:.2pt'> </font>Company<font style='letter-spacing:.25pt'> </font>has<font style='letter-spacing:.2pt'> </font>not<font style='letter-spacing:.25pt'> </font>recorded<font style='letter-spacing:.2pt'> </font>any<font style='letter-spacing:.25pt'> </font>related<font style='letter-spacing:.2pt'> </font>impairment<font style='letter-spacing:.25pt'> </font>losses.</font></p> <p style='margin:0in;margin-bottom:.0001pt;margin-top:.9pt;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;line-height:11.0pt'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:.35pt'> </font>Company<font style='letter-spacing:.35pt'> </font>does<font style='letter-spacing:.35pt'> </font>not<font style='letter-spacing:.4pt'> </font>amortize<font style='letter-spacing:.35pt'> </font>goodwill<font style='letter-spacing:.35pt'> </font>and<font style='letter-spacing:.35pt'> </font>intangible<font style='letter-spacing:.4pt'> </font>assets<font style='letter-spacing:.35pt'> </font>with<font style='letter-spacing:.35pt'> </font>indefinite<font style='letter-spacing:.35pt'> </font>useful<font style='letter-spacing:.4pt'> </font>lives,<font style='letter-spacing:.35pt'> </font>rather<font style='letter-spacing:.35pt'> </font>such<font style='letter-spacing:.35pt'> </font>assets<font style='letter-spacing:.4pt'> </font>are<font style='letter-spacing:.35pt'> </font>required<font style='letter-spacing:.35pt'> </font>to<font style='letter-spacing:.4pt'> </font>be<font style='letter-spacing:.35pt'> </font>tested<font style='letter-spacing:.35pt'> </font>for impairment<font style='letter-spacing:1.95pt'> </font>at<font style='letter-spacing:1.95pt'> </font>least<font style='letter-spacing:1.95pt'> </font>annually<font style='letter-spacing:1.95pt'> </font>or<font style='letter-spacing:1.95pt'> </font>sooner<font style='letter-spacing:1.95pt'> </font>whenever<font style='letter-spacing:1.95pt'> </font>events<font style='letter-spacing:1.95pt'> </font>or<font style='letter-spacing:1.95pt'> </font>changes<font style='letter-spacing:1.95pt'> </font>in<font style='letter-spacing:1.95pt'> </font>circumstances<font style='letter-spacing:1.95pt'> </font>indicate<font style='letter-spacing:1.95pt'> </font>that<font style='letter-spacing:1.95pt'> </font>the<font style='letter-spacing:2.0pt'> </font>assets<font style='letter-spacing:1.95pt'> </font>may<font style='letter-spacing:1.95pt'> </font>be<font style='letter-spacing:1.95pt'> </font>impaired.<font style='letter-spacing:1.95pt'> </font>The Company<font style='letter-spacing:.25pt'> </font>has<font style='letter-spacing:.3pt'> </font>not<font style='letter-spacing:.3pt'> </font>recorded<font style='letter-spacing:.3pt'> </font>any<font style='letter-spacing:.3pt'> </font>related<font style='letter-spacing:.25pt'> </font>impairment<font style='letter-spacing:.3pt'> </font>losses.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Revenue recognition</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>We adopted ASC 606 on August 1, 2018. Revenue is measured based on a consideration specified in a contract or agreement with a customer. The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer. Incidental items that are immaterial in the context of the contract are recognized as expense. Unearned revenues are recorded when cash payments are received or due in advance of the performance of the services. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:2.25pt'> </font>Company&#146;s revenues consist primarily of subscription agreements for its broadband internet and voice-over-IP phone services. Residential broadband service delivered to customers over the Company&#146;s hybrid fiber and wireless network in Atlantic County, New Jersey is the primary revenue source. Revenues are supplemented by phone and add-on services. Broadband services delivered via fiber optics to enterprise businesses account for the remaining sources of revenue. Services are billed monthly to subscribers on either a one- year or two-year contract for residential customers and three-year contracts for enterprise business customers. Revenue begins accruing as service is delivered at commencement of the customer&#146;s service contract.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Revenue is recorded net of discounts provided to customers. Discounts applied during the quarter ended October 31, 2018 and 2017 were $3,287 and $6,319, respectively.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Income taxes</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:1.55pt'> </font>Company<font style='letter-spacing:1.55pt'> </font>accounts<font style='letter-spacing:1.55pt'> </font>for<font style='letter-spacing:1.55pt'> </font>income<font style='letter-spacing:1.55pt'> </font>taxes<font style='letter-spacing:1.55pt'> </font>using<font style='letter-spacing:1.55pt'> </font>the<font style='letter-spacing:1.55pt'> </font>asset<font style='letter-spacing:1.55pt'> </font>and<font style='letter-spacing:1.55pt'> </font>liability<font style='letter-spacing:1.55pt'> </font>method<font style='letter-spacing:1.55pt'> </font>in<font style='letter-spacing:1.6pt'> </font>accordance<font style='letter-spacing:1.55pt'> </font>with<font style='letter-spacing:1.55pt'> </font>ASC<font style='letter-spacing:1.55pt'> </font>740,<font style='letter-spacing:1.55pt'> </font>&#147;Accounting<font style='letter-spacing:1.55pt'> </font>for<font style='letter-spacing:1.55pt'> </font>Income <font style='letter-spacing:-.7pt'>T</font>axes&#148;.<font style='letter-spacing:.1pt'> </font>The<font style='letter-spacing:.15pt'> </font>asset<font style='letter-spacing:.1pt'> </font>and<font style='letter-spacing:.15pt'> </font>liability<font style='letter-spacing:.1pt'> </font>method<font style='letter-spacing:.1pt'> </font>provides<font style='letter-spacing:.15pt'> </font>that<font style='letter-spacing:.1pt'> </font>deferred<font style='letter-spacing:.15pt'> </font>tax<font style='letter-spacing:.1pt'> </font>assets<font style='letter-spacing:.15pt'> </font>and<font style='letter-spacing:.1pt'> </font>liabilities<font style='letter-spacing:.15pt'> </font>are<font style='letter-spacing:.1pt'> </font>recognized<font style='letter-spacing:.15pt'> </font>for<font style='letter-spacing:.1pt'> </font>the<font style='letter-spacing:.15pt'> </font>expected<font style='letter-spacing:.1pt'> </font>future<font style='letter-spacing:.15pt'> </font>tax consequences<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.3pt'> </font>temporary<font style='letter-spacing:.25pt'> </font>di<font style='letter-spacing:-.2pt'>f</font>ferences<font style='letter-spacing:.3pt'> </font>between<font style='letter-spacing:.25pt'> </font>the<font style='letter-spacing:.3pt'> </font>financial<font style='letter-spacing:.25pt'> </font>reporting<font style='letter-spacing:.3pt'> </font>and<font style='letter-spacing:.25pt'> </font>tax<font style='letter-spacing:.3pt'> </font>bases<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.3pt'> </font>assets<font style='letter-spacing:.25pt'> </font>and<font style='letter-spacing:.3pt'> </font>liabilities<font style='letter-spacing:.25pt'> </font>and<font style='letter-spacing:.3pt'> </font>for<font style='letter-spacing:.25pt'> </font>operating<font style='letter-spacing:.3pt'> </font>loss<font style='letter-spacing:.25pt'> </font>and<font style='letter-spacing:.3pt'> </font>tax credit<font style='letter-spacing:.65pt'> </font>carry<font style='letter-spacing:.65pt'> </font>forwards.<font style='letter-spacing:.65pt'> </font>Deferred<font style='letter-spacing:.65pt'> </font>tax<font style='letter-spacing:.65pt'> </font>assets<font style='letter-spacing:.65pt'> </font>and<font style='letter-spacing:.65pt'> </font>liabilities<font style='letter-spacing:.65pt'> </font>are<font style='letter-spacing:.65pt'> </font>measured<font style='letter-spacing:.65pt'> </font>using<font style='letter-spacing:.65pt'> </font>the<font style='letter-spacing:.65pt'> </font>currently<font style='letter-spacing:.65pt'> </font>enacted<font style='letter-spacing:.65pt'> </font>tax<font style='letter-spacing:.65pt'> </font>rates<font style='letter-spacing:.65pt'> </font>and<font style='letter-spacing:.65pt'> </font>laws<font style='letter-spacing:.65pt'> </font>that<font style='letter-spacing:.65pt'> </font>will<font style='letter-spacing:.65pt'> </font>be<font style='letter-spacing:.7pt'> </font>in<font style='letter-spacing:.65pt'> </font>e<font style='letter-spacing:-.2pt'>f</font>fect when<font style='letter-spacing:.3pt'> </font>the<font style='letter-spacing:.3pt'> </font>di<font style='letter-spacing:-.2pt'>f</font>ferences<font style='letter-spacing:.3pt'> </font>are<font style='letter-spacing:.35pt'> </font>expected<font style='letter-spacing:.3pt'> </font>to<font style='letter-spacing:.3pt'> </font>reverse.<font style='letter-spacing:.3pt'> </font>The<font style='letter-spacing:.3pt'> </font>Company<font style='letter-spacing:.35pt'> </font>records<font style='letter-spacing:.3pt'> </font>a<font style='letter-spacing:.3pt'> </font>valuation<font style='letter-spacing:.3pt'> </font>allowance<font style='letter-spacing:.35pt'> </font>to<font style='letter-spacing:.3pt'> </font>reduce<font style='letter-spacing:.3pt'> </font>deferred<font style='letter-spacing:.3pt'> </font>tax<font style='letter-spacing:.35pt'> </font>assets<font style='letter-spacing:.3pt'> </font>to<font style='letter-spacing:.3pt'> </font>the<font style='letter-spacing:.3pt'> </font>amount<font style='letter-spacing:.35pt'> </font>that is<font style='letter-spacing:.15pt'> </font>believed<font style='letter-spacing:.2pt'> </font>more<font style='letter-spacing:.2pt'> </font>likely<font style='letter-spacing:.2pt'> </font>than<font style='letter-spacing:.2pt'> </font>not<font style='letter-spacing:.2pt'> </font>to<font style='letter-spacing:.2pt'> </font>be<font style='letter-spacing:.2pt'> </font>realized.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Fair value measurements</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>The<font style='letter-spacing:.35pt'> </font>Company<font style='letter-spacing:.35pt'> </font>adopted<font style='letter-spacing:.4pt'> </font>the<font style='letter-spacing:.35pt'> </font>provisions<font style='letter-spacing:.4pt'> </font>of<font style='letter-spacing:.35pt'> </font>ASC<font style='letter-spacing:.4pt'> </font><font style='letter-spacing:-.7pt'>T</font>opic<font style='letter-spacing:.35pt'> </font>820,<font style='letter-spacing:.4pt'> </font>&#147;Fair<font style='letter-spacing:.35pt'> </font><font style='letter-spacing:-1.1pt'>V</font>alue<font style='letter-spacing:.4pt'> </font>Measurements<font style='letter-spacing:.35pt'> </font>and<font style='letter-spacing:.4pt'> </font>Disclosures&#148;,<font style='letter-spacing:.35pt'> </font>which<font style='letter-spacing:.4pt'> </font>defines<font style='letter-spacing:.35pt'> </font>fair<font style='letter-spacing:.4pt'> </font>value<font style='letter-spacing:.35pt'> </font>as<font style='letter-spacing:.4pt'> </font>used<font style='letter-spacing:.35pt'> </font>in numerous<font style='letter-spacing:1.25pt'> </font>accounting<font style='letter-spacing:1.3pt'> </font>pronouncements,<font style='letter-spacing:1.3pt'> </font>establishes<font style='letter-spacing:1.25pt'> </font>a<font style='letter-spacing:1.3pt'> </font>framework<font style='letter-spacing:1.3pt'> </font>for<font style='letter-spacing:1.25pt'> </font>measuring<font style='letter-spacing:1.3pt'> </font>fair<font style='letter-spacing:1.3pt'> </font>value<font style='letter-spacing:1.25pt'> </font>and<font style='letter-spacing:1.3pt'> </font>expands<font style='letter-spacing:1.3pt'> </font>disclosure<font style='letter-spacing:1.25pt'> </font>of<font style='letter-spacing:1.3pt'> </font>fair<font style='letter-spacing:1.3pt'> </font>value measurements.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;line-height:108%'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-top:3.9pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;line-height:108%'><font style='line-height:108%'>The<font style='letter-spacing:1.05pt'> </font>estimated<font style='letter-spacing:1.1pt'> </font>fair<font style='letter-spacing:1.1pt'> </font>value<font style='letter-spacing:1.1pt'> </font>of<font style='letter-spacing:1.1pt'> </font>certain<font style='letter-spacing:1.1pt'> </font>financial<font style='letter-spacing:1.1pt'> </font>instruments,<font style='letter-spacing:1.1pt'> </font>including<font style='letter-spacing:1.1pt'> </font>cash<font style='letter-spacing:1.1pt'> </font>and<font style='letter-spacing:1.05pt'> </font>cash<font style='letter-spacing:1.1pt'> </font>equivalents<font style='letter-spacing:1.1pt'> </font>are<font style='letter-spacing:1.1pt'> </font>carried<font style='letter-spacing:1.1pt'> </font>at<font style='letter-spacing:1.1pt'> </font>historical<font style='letter-spacing:1.1pt'> </font>cost<font style='letter-spacing:1.1pt'> </font>basis,<font style='letter-spacing:1.1pt'> </font>which approximates<font style='letter-spacing:.25pt'> </font>their<font style='letter-spacing:.25pt'> </font>fair<font style='letter-spacing:.3pt'> </font>values<font style='letter-spacing:.25pt'> </font>because<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.25pt'> </font>the<font style='letter-spacing:.3pt'> </font>short-term<font style='letter-spacing:.25pt'> </font>nature<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.3pt'> </font>these<font style='letter-spacing:.25pt'> </font>instruments.</font></p> <p style='margin:0in;margin-bottom:.0001pt;margin-top:.15pt;text-align:justify;line-height:14.0pt'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>ASC<font style='letter-spacing:.8pt'> </font>820<font style='letter-spacing:.8pt'> </font>defines<font style='letter-spacing:.8pt'> </font>fair<font style='letter-spacing:.85pt'> </font>value<font style='letter-spacing:.8pt'> </font>as<font style='letter-spacing:.8pt'> </font>the<font style='letter-spacing:.85pt'> </font>exchange<font style='letter-spacing:.8pt'> </font>price<font style='letter-spacing:.8pt'> </font>that<font style='letter-spacing:.85pt'> </font>would<font style='letter-spacing:.8pt'> </font>be<font style='letter-spacing:.8pt'> </font>received<font style='letter-spacing:.8pt'> </font>for<font style='letter-spacing:.85pt'> </font>an<font style='letter-spacing:.8pt'> </font>asset<font style='letter-spacing:.8pt'> </font>or<font style='letter-spacing:.85pt'> </font>paid<font style='letter-spacing:.8pt'> </font>to<font style='letter-spacing:.8pt'> </font>transfer<font style='letter-spacing:.85pt'> </font>a<font style='letter-spacing:.8pt'> </font>liability<font style='letter-spacing:.8pt'> </font>(an<font style='letter-spacing:.85pt'> </font>exit<font style='letter-spacing:.8pt'> </font>price)<font style='letter-spacing:.8pt'> </font>in<font style='letter-spacing:.8pt'> </font>the principal<font style='letter-spacing:.45pt'> </font>or<font style='letter-spacing:.5pt'> </font>most<font style='letter-spacing:.5pt'> </font>advantageous<font style='letter-spacing:.45pt'> </font>market<font style='letter-spacing:.5pt'> </font>for<font style='letter-spacing:.5pt'> </font>the<font style='letter-spacing:.45pt'> </font>asset<font style='letter-spacing:.5pt'> </font>or<font style='letter-spacing:.5pt'> </font>liability<font style='letter-spacing:.5pt'> </font>in<font style='letter-spacing:.45pt'> </font>an<font style='letter-spacing:.5pt'> </font>orderly<font style='letter-spacing:.5pt'> </font>transaction<font style='letter-spacing:.45pt'> </font>between<font style='letter-spacing:.5pt'> </font>market<font style='letter-spacing:.5pt'> </font>participants<font style='letter-spacing:.45pt'> </font>on<font style='letter-spacing:.5pt'> </font>the<font style='letter-spacing:.5pt'> </font>measurement date.<font style='letter-spacing:.4pt'> </font>ASC<font style='letter-spacing:.4pt'> </font>820<font style='letter-spacing:.4pt'> </font>also<font style='letter-spacing:.4pt'> </font>establishes<font style='letter-spacing:.4pt'> </font>a<font style='letter-spacing:.4pt'> </font>fair<font style='letter-spacing:.4pt'> </font>value<font style='letter-spacing:.4pt'> </font>hierarch<font style='letter-spacing:-.65pt'>y</font>,<font style='letter-spacing:.4pt'> </font>which<font style='letter-spacing:.4pt'> </font>requires<font style='letter-spacing:.4pt'> </font>an<font style='letter-spacing:.4pt'> </font>entity<font style='letter-spacing:.4pt'> </font>to<font style='letter-spacing:.4pt'> </font>maximize<font style='letter-spacing:.4pt'> </font>the<font style='letter-spacing:.4pt'> </font>use<font style='letter-spacing:.45pt'> </font>of<font style='letter-spacing:.4pt'> </font>observable<font style='letter-spacing:.4pt'> </font>inputs<font style='letter-spacing:.4pt'> </font>and<font style='letter-spacing:.4pt'> </font>minimize<font style='letter-spacing:.4pt'> </font>the use<font style='letter-spacing:.2pt'> </font>of<font style='letter-spacing:.2pt'> </font>unobservable<font style='letter-spacing:.2pt'> </font>inputs<font style='letter-spacing:.2pt'> </font>when<font style='letter-spacing:.25pt'> </font>measuring<font style='letter-spacing:.2pt'> </font>fair<font style='letter-spacing:.2pt'> </font>value.<font style='letter-spacing:.2pt'> </font>ASC<font style='letter-spacing:.2pt'> </font>820<font style='letter-spacing:.25pt'> </font>describes<font style='letter-spacing:.2pt'> </font>three<font style='letter-spacing:.2pt'> </font>levels<font style='letter-spacing:.2pt'> </font>of<font style='letter-spacing:.25pt'> </font>inputs<font style='letter-spacing:.2pt'> </font>that<font style='letter-spacing:.2pt'> </font>may<font style='letter-spacing:.2pt'> </font>be<font style='letter-spacing:.2pt'> </font>used<font style='letter-spacing:.25pt'> </font>to<font style='letter-spacing:.2pt'> </font>measure<font style='letter-spacing:.2pt'> </font>fair<font style='letter-spacing:.2pt'> </font>value:</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Level<font style='letter-spacing:.2pt'> </font>1<font style='letter-spacing:.2pt'> </font>&#151;<font style='letter-spacing:.2pt'> </font>quoted<font style='letter-spacing:.2pt'> </font>prices<font style='letter-spacing:.25pt'> </font>in<font style='letter-spacing:.2pt'> </font>active<font style='letter-spacing:.2pt'> </font>markets<font style='letter-spacing:.2pt'> </font>for<font style='letter-spacing:.25pt'> </font>identical<font style='letter-spacing:.2pt'> </font>assets<font style='letter-spacing:.2pt'> </font>or<font style='letter-spacing:.2pt'> </font>liabilities</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Level<font style='letter-spacing:.15pt'> </font>2<font style='letter-spacing:.2pt'> </font>&#151;<font style='letter-spacing:.2pt'> </font>quoted<font style='letter-spacing:.2pt'> </font>prices<font style='letter-spacing:.2pt'> </font>for<font style='letter-spacing:.2pt'> </font>similar<font style='letter-spacing:.15pt'> </font>assets<font style='letter-spacing:.2pt'> </font>and<font style='letter-spacing:.2pt'> </font>liabilities<font style='letter-spacing:.2pt'> </font>in<font style='letter-spacing:.2pt'> </font>active<font style='letter-spacing:.2pt'> </font>markets<font style='letter-spacing:.15pt'> </font>or<font style='letter-spacing:.2pt'> </font>inputs<font style='letter-spacing:.2pt'> </font>that<font style='letter-spacing:.2pt'> </font>are<font style='letter-spacing:.2pt'> </font>observable </p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Level<font style='letter-spacing:.2pt'> </font>3<font style='letter-spacing:.2pt'> </font>&#151;<font style='letter-spacing:.25pt'> </font>inputs<font style='letter-spacing:.2pt'> </font>that<font style='letter-spacing:.25pt'> </font>are<font style='letter-spacing:.2pt'> </font>unobservable<font style='letter-spacing:.25pt'> </font>(for<font style='letter-spacing:.2pt'> </font>example<font style='letter-spacing:.2pt'> </font>cash<font style='letter-spacing:.25pt'> </font>flow<font style='letter-spacing:.2pt'> </font>modeling<font style='letter-spacing:.25pt'> </font>inputs<font style='letter-spacing:.2pt'> </font>based<font style='letter-spacing:.25pt'> </font>on<font style='letter-spacing:.2pt'> </font>assumptions) The<font style='letter-spacing:.15pt'> </font>Company<font style='letter-spacing:.2pt'> </font>has<font style='letter-spacing:.2pt'> </font>no<font style='letter-spacing:.2pt'> </font>assets<font style='letter-spacing:.2pt'> </font>or<font style='letter-spacing:.2pt'> </font>liabilities<font style='letter-spacing:.2pt'> </font>valued<font style='letter-spacing:.2pt'> </font>at<font style='letter-spacing:.2pt'> </font>fair<font style='letter-spacing:.2pt'> </font>value<font style='letter-spacing:.2pt'> </font>on<font style='letter-spacing:.2pt'> </font>a<font style='letter-spacing:.2pt'> </font>recurring<font style='letter-spacing:.2pt'> </font>basis.</p> <p style='margin-left:0in'>&nbsp;</p> <p style='margin-left:0in'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Consolidation of financial statements</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Hammer<font style='letter-spacing:2.1pt'> </font>Fiber<font style='letter-spacing:2.15pt'> </font>Optics<font style='letter-spacing:2.1pt'> </font>Holdings<font style='letter-spacing:2.15pt'> </font>Corp.<font style='letter-spacing:2.15pt'> </font>is<font style='letter-spacing:2.1pt'> </font>the<font style='letter-spacing:2.15pt'> </font>parent<font style='letter-spacing:2.15pt'> </font>company<font style='letter-spacing:2.1pt'> </font>and<font style='letter-spacing:2.15pt'> </font>sole<font style='letter-spacing:2.1pt'> </font>shareholder<font style='letter-spacing:2.15pt'> </font>of<font style='letter-spacing:2.15pt'> </font>Hammer<font style='letter-spacing:2.1pt'> </font><font style='letter-spacing:-.4pt'>W</font>ireless<font style='letter-spacing:2.15pt'> </font>Corporation.<font style='letter-spacing:2.15pt'> </font>The<font style='letter-spacing:2.1pt'> </font>financial statements<font style='letter-spacing:.35pt'> </font>for<font style='letter-spacing:.4pt'> </font>Hammer<font style='letter-spacing:.4pt'> </font>Fiber<font style='letter-spacing:.4pt'> </font>Optics<font style='letter-spacing:.4pt'> </font>Holdings<font style='letter-spacing:.4pt'> </font>Corp.<font style='letter-spacing:.4pt'> </font>and<font style='letter-spacing:.4pt'> </font>its<font style='letter-spacing:.4pt'> </font>wholly-owned<font style='letter-spacing:.4pt'> </font>subsidiaries<font style='letter-spacing:.4pt'> </font>are<font style='letter-spacing:.4pt'> </font>reported<font style='letter-spacing:.4pt'> </font>on<font style='letter-spacing:.4pt'> </font>a<font style='letter-spacing:.4pt'> </font>consolidated<font style='letter-spacing:.4pt'> </font>basis.<font style='letter-spacing:.4pt'> </font>All<font style='letter-spacing:.4pt'> </font>significant intercompany<font style='letter-spacing:.35pt'> </font>accounts<font style='letter-spacing:.35pt'> </font>and<font style='letter-spacing:.4pt'> </font>transactions<font style='letter-spacing:.35pt'> </font>have<font style='letter-spacing:.4pt'> </font>been<font style='letter-spacing:.35pt'> </font>eliminated.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Basic and Diluted Earnings (Loss) per Common Share</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:1.95pt'> </font>basic<font style='letter-spacing:1.95pt'> </font>earnings<font style='letter-spacing:1.95pt'> </font>(loss)<font style='letter-spacing:1.95pt'> </font>per<font style='letter-spacing:1.95pt'> </font>share<font style='letter-spacing:1.95pt'> </font>are<font style='letter-spacing:1.95pt'> </font>calculated<font style='letter-spacing:1.95pt'> </font>by<font style='letter-spacing:1.95pt'> </font>dividing<font style='letter-spacing:1.95pt'> </font>the<font style='letter-spacing:1.95pt'> </font>Company's<font style='letter-spacing:1.95pt'> </font>net<font style='letter-spacing:1.95pt'> </font>income<font style='letter-spacing:1.95pt'> </font>available<font style='letter-spacing:1.95pt'> </font>to<font style='letter-spacing:1.95pt'> </font>common<font style='letter-spacing:1.95pt'> </font>shareholders<font style='letter-spacing:1.95pt'> </font>by<font style='letter-spacing:1.95pt'> </font>the weighted<font style='letter-spacing:.2pt'> </font>average<font style='letter-spacing:.2pt'> </font>number<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.2pt'> </font>common<font style='letter-spacing:.25pt'> </font>shares<font style='letter-spacing:.2pt'> </font>during<font style='letter-spacing:.25pt'> </font>the<font style='letter-spacing:.2pt'> </font>yea<font style='letter-spacing:-.55pt'>r</font>.<font style='letter-spacing:.25pt'> </font>The<font style='letter-spacing:.2pt'> </font>diluted<font style='letter-spacing:.25pt'> </font>earnings<font style='letter-spacing:.2pt'> </font>(loss)<font style='letter-spacing:.25pt'> </font>per<font style='letter-spacing:.2pt'> </font>share<font style='letter-spacing:.25pt'> </font>is<font style='letter-spacing:.2pt'> </font>calculated<font style='letter-spacing:.25pt'> </font>by dividing the Company's<font style='letter-spacing:.5pt'> </font>net<font style='letter-spacing:.5pt'> </font>income<font style='letter-spacing:.5pt'> </font>(loss)<font style='letter-spacing:.45pt'> </font>available<font style='letter-spacing:.5pt'> </font>to<font style='letter-spacing:.5pt'> </font>common<font style='letter-spacing:.5pt'> </font>shareholders<font style='letter-spacing:.5pt'> </font>by<font style='letter-spacing:.5pt'> </font>the<font style='letter-spacing:.5pt'> </font>diluted<font style='letter-spacing:.5pt'> </font>weighted<font style='letter-spacing:.5pt'> </font>average<font style='letter-spacing:.5pt'> </font>number<font style='letter-spacing:.5pt'> </font>of<font style='letter-spacing:.5pt'> </font>shares<font style='letter-spacing:.5pt'> </font>outstanding<font style='letter-spacing:.5pt'> </font>during<font style='letter-spacing:.5pt'> </font>the yea<font style='letter-spacing:-.55pt'>r</font>.<font style='letter-spacing:1.45pt'> </font>The<font style='letter-spacing:1.45pt'> </font>diluted<font style='letter-spacing:1.45pt'> </font>weighted<font style='letter-spacing:1.45pt'> </font>average<font style='letter-spacing:1.45pt'> </font>number<font style='letter-spacing:1.45pt'> </font>of<font style='letter-spacing:1.5pt'> </font>shares<font style='letter-spacing:1.45pt'> </font>outstanding<font style='letter-spacing:1.45pt'> </font>is<font style='letter-spacing:1.45pt'> </font>the<font style='letter-spacing:1.45pt'> </font>basic<font style='letter-spacing:1.45pt'> </font>weighted<font style='letter-spacing:1.5pt'> </font>number<font style='letter-spacing:1.45pt'> </font>of<font style='letter-spacing:1.45pt'> </font>shares<font style='letter-spacing:1.45pt'> </font>adjusted<font style='letter-spacing:1.45pt'> </font>for<font style='letter-spacing:1.45pt'> </font>any<font style='letter-spacing:1.45pt'> </font>potentially dilutive<font style='letter-spacing:.35pt'> </font>debt<font style='letter-spacing:.4pt'> </font>or<font style='letter-spacing:.35pt'> </font>equit<font style='letter-spacing:-.65pt'>y</font>.<font style='letter-spacing:.4pt'> </font>Diluted<font style='letter-spacing:.35pt'> </font>earnings<font style='letter-spacing:.4pt'> </font>(loss)<font style='letter-spacing:.35pt'> </font>per<font style='letter-spacing:.4pt'> </font>share<font style='letter-spacing:.35pt'> </font>are<font style='letter-spacing:.4pt'> </font>the<font style='letter-spacing:.35pt'> </font>same<font style='letter-spacing:.4pt'> </font>as<font style='letter-spacing:.35pt'> </font>basic<font style='letter-spacing:.4pt'> </font>earnings<font style='letter-spacing:.35pt'> </font>(loss)<font style='letter-spacing:.4pt'> </font>per<font style='letter-spacing:.35pt'> </font>share<font style='letter-spacing:.4pt'> </font>due<font style='letter-spacing:.35pt'> </font>to<font style='letter-spacing:.4pt'> </font>the<font style='letter-spacing:.35pt'> </font>lack<font style='letter-spacing:.4pt'> </font>of<font style='letter-spacing:.35pt'> </font>dilutive<font style='letter-spacing:.4pt'> </font>items<font style='letter-spacing:.35pt'> </font>in the<font style='letter-spacing:.2pt'> </font>Compan<font style='letter-spacing:-.65pt'>y</font>.<font style='letter-spacing:.25pt'> </font>As<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.25pt'> </font>October 31, and<font style='letter-spacing:.25pt'> </font>July 31, 2018,<font style='letter-spacing:.2pt'> </font>there<font style='letter-spacing:.25pt'> </font>were<font style='letter-spacing:.25pt'> </font>no<font style='letter-spacing:.25pt'> </font>common<font style='letter-spacing:.2pt'> </font>stock<font style='letter-spacing:.25pt'> </font>equivalents<font style='letter-spacing:.25pt'> </font>outstanding.</p> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Recent accounting pronouncements</i></b></p> <p style='margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>In June 2018, the FASB issued ASU No. 2018-07, Compensation &#150; Stock Compensation (Topic 718) (&#147;ASU 2018-07&#148;). ASU 2018-07 provides for improvements to nonemployee share-based payment accounting by expanding the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The awards will be measured at grant date, consistent with accounting for employee share-based payment awards. The measurement date has been redefined as the date at which the grantor and grantee reach a mutual understanding of the key terms and conditions of the award. The requirement to reassess classification of equity-classified awards upon vesting has been eliminated. We do not expect the adoption of this standard to have a material impact on the Company&#146;s financial statements. The Company adopted ASU 2018-07 August 1, 2018.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>In February 2016, FASB issued ASU No. 2016-02, Accounting Standards Update No. 2016-02, Leases (Topic 842).&#160; ASU 2016-02 provides for improvements for accounting guidance related to a leasing treatments on financial statements as a response to user input. The update maintains two classifications of leases, Financial lease and Operating leases.&#160;&#160; The Update is effective for fiscal years beginning after December 2015, 2018.&#160; The company has not yet adopted this standard but there may be impact to the presentation of the Company&#146;s financial statements during the period of adoption.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Basis<font style='letter-spacing:.35pt'> </font>of<font style='letter-spacing:.4pt'> </font>presentation</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:1.95pt'> </font>accompanying<font style='letter-spacing:1.95pt'> </font>consolidated<font style='letter-spacing:2.0pt'> </font>financial<font style='letter-spacing:1.95pt'> </font>statements<font style='letter-spacing:2.0pt'> </font>and<font style='letter-spacing:1.95pt'> </font>related<font style='letter-spacing:2.0pt'> </font>notes<font style='letter-spacing:1.95pt'> </font>have<font style='letter-spacing:2.0pt'> </font>been<font style='letter-spacing:1.95pt'> </font>prepared<font style='letter-spacing:2.0pt'> </font>in<font style='letter-spacing:1.95pt'> </font>accordance<font style='letter-spacing:2.0pt'> </font>with<font style='letter-spacing:1.95pt'> </font>accounting<font style='letter-spacing:1.95pt'> </font>principles generally<font style='letter-spacing:.25pt'> </font>accepted<font style='letter-spacing:.25pt'> </font>in<font style='letter-spacing:.25pt'> </font>the<font style='letter-spacing:.3pt'> </font>United<font style='letter-spacing:.25pt'> </font>States<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.25pt'> </font>America<font style='letter-spacing:.3pt'> </font>(&#147;U.S.<font style='letter-spacing:.25pt'> </font>GAAP&#148;). The<font style='letter-spacing:.65pt'> </font>interim<font style='letter-spacing:.7pt'> </font>financial<font style='letter-spacing:.7pt'> </font>statements<font style='letter-spacing:.65pt'> </font>for<font style='letter-spacing:.7pt'> </font>the<font style='letter-spacing:.7pt'> </font>fiscal<font style='letter-spacing:.65pt'> </font>quarter<font style='letter-spacing:.7pt'> </font>ending<font style='letter-spacing:.7pt'> October 31</font>,<font style='letter-spacing:.7pt'> </font>2018<font style='letter-spacing:.7pt'> </font>are<font style='letter-spacing:.65pt'> </font>unaudited.<font style='letter-spacing:.7pt'> </font>These<font style='letter-spacing:.7pt'> </font>financial<font style='letter-spacing:.7pt'> </font>statements<font style='letter-spacing:.65pt'> </font>are<font style='letter-spacing:.7pt'> </font>prepared<font style='letter-spacing:.7pt'> </font>in accordance<font style='letter-spacing:.7pt'> </font>with<font style='letter-spacing:.7pt'> </font>requirements<font style='letter-spacing:.7pt'> </font>for<font style='letter-spacing:.7pt'> </font>unaudited<font style='letter-spacing:.7pt'> </font>interim<font style='letter-spacing:.7pt'> </font>periods<font style='letter-spacing:.7pt'> </font>and<font style='letter-spacing:.7pt'> </font>consequently<font style='letter-spacing:.7pt'> </font>do<font style='letter-spacing:.7pt'> </font>not<font style='letter-spacing:.7pt'> </font>include<font style='letter-spacing:.7pt'> </font>all<font style='letter-spacing:.7pt'> </font>disclosures<font style='letter-spacing:.7pt'> </font>required<font style='letter-spacing:.7pt'> </font>to<font style='letter-spacing:.7pt'> </font>be<font style='letter-spacing:.7pt'> </font>in<font style='letter-spacing:.7pt'> </font>conformity with<font style='letter-spacing:.95pt'> </font>accounting<font style='letter-spacing:.95pt'> </font>principles<font style='letter-spacing:1.0pt'> </font>generally<font style='letter-spacing:.95pt'> </font>accepted<font style='letter-spacing:1.0pt'> </font>in<font style='letter-spacing:.95pt'> </font>the<font style='letter-spacing:.95pt'> </font>United<font style='letter-spacing:1.0pt'> </font>States<font style='letter-spacing:.95pt'> </font>of<font style='letter-spacing:1.0pt'> </font>America.<font style='letter-spacing:.95pt'> </font>The<font style='letter-spacing:.95pt'> </font>results<font style='letter-spacing:1.0pt'> </font>of<font style='letter-spacing:.95pt'> </font>operations<font style='letter-spacing:1.0pt'> </font>for<font style='letter-spacing:.95pt'> </font>the<font style='letter-spacing:1.0pt'> </font>interim<font style='letter-spacing:.95pt'> </font>periods<font style='letter-spacing:.95pt'> </font>are<font style='letter-spacing:1.0pt'> </font>not necessarily<font style='letter-spacing:1.3pt'> </font>indicative<font style='letter-spacing:1.3pt'> </font>of<font style='letter-spacing:1.35pt'> </font>the<font style='letter-spacing:1.3pt'> </font>results<font style='letter-spacing:1.35pt'> </font>for<font style='letter-spacing:1.3pt'> </font>the<font style='letter-spacing:1.3pt'> </font>full<font style='letter-spacing:1.35pt'> </font>yea<font style='letter-spacing:-.55pt'>r</font>.<font style='letter-spacing:1.3pt'> </font>In<font style='letter-spacing:1.35pt'> </font>management's<font style='letter-spacing:1.3pt'> </font>opinion,<font style='letter-spacing:1.3pt'> </font>all<font style='letter-spacing:1.35pt'> </font>adjustments<font style='letter-spacing:1.3pt'> </font>necessary<font style='letter-spacing:1.35pt'> </font>for<font style='letter-spacing:1.3pt'> </font>a<font style='letter-spacing:1.3pt'> </font>fair<font style='letter-spacing:1.35pt'> </font>presentation<font style='letter-spacing:1.3pt'> </font>of<font style='letter-spacing:1.35pt'> </font>the Company's<font style='letter-spacing:.35pt'> </font>financial<font style='letter-spacing:.4pt'> </font>statements<font style='letter-spacing:.4pt'> </font>are<font style='letter-spacing:.35pt'> </font>reflected<font style='letter-spacing:.4pt'> </font>in<font style='letter-spacing:.4pt'> </font>the<font style='letter-spacing:.4pt'> </font>interim<font style='letter-spacing:.35pt'> </font>periods<font style='letter-spacing:.4pt'> </font>included and<font style='letter-spacing:.4pt'> </font>are<font style='letter-spacing:.35pt'> </font>of<font style='letter-spacing:.4pt'> </font>a<font style='letter-spacing:.4pt'> </font>normal<font style='letter-spacing:.4pt'> </font>recurring<font style='letter-spacing:.35pt'> </font>nature.<font style='letter-spacing:.4pt'> </font>These<font style='letter-spacing:.4pt'> </font>interim<font style='letter-spacing:.4pt'> </font>financial statements<font style='letter-spacing:.85pt'> </font>should<font style='letter-spacing:.9pt'> </font>be<font style='letter-spacing:.9pt'> </font>read<font style='letter-spacing:.9pt'> </font>in<font style='letter-spacing:.9pt'> </font>conjunction<font style='letter-spacing:.9pt'> </font>with<font style='letter-spacing:.9pt'> </font>the<font style='letter-spacing:.9pt'> </font>financial<font style='letter-spacing:.9pt'> </font>statements<font style='letter-spacing:.9pt'> </font>included<font style='letter-spacing:.9pt'> </font>in<font style='letter-spacing:.9pt'> </font>our<font style='letter-spacing:.9pt'> </font>Form<font style='letter-spacing:.9pt'> </font>10-K,<font style='letter-spacing:.9pt'> </font>for<font style='letter-spacing:.9pt'> </font>the<font style='letter-spacing:.9pt'> </font>year<font style='letter-spacing:.9pt'> </font>ended<font style='letter-spacing:.9pt'> </font>July<font style='letter-spacing:.9pt'> </font>31,<font style='letter-spacing:.9pt'> </font>2018,<font style='letter-spacing:.9pt'> </font>as filed<font style='letter-spacing:.25pt'> </font>with<font style='letter-spacing:.3pt'> </font>the<font style='letter-spacing:.3pt'> </font>Securities<font style='letter-spacing:.3pt'> </font>and<font style='letter-spacing:.25pt'> </font>Exchange<font style='letter-spacing:.3pt'> </font>Commission<font style='letter-spacing:.3pt'> </font>(&#147;the<font style='letter-spacing:.25pt'> </font>SEC&#148;)<font style='letter-spacing:.3pt'> </font>at<font style='letter-spacing:.3pt'> </font>ww<font style='letter-spacing:-.65pt'>w</font>.sec.go<font style='letter-spacing:-.65pt'>v</font>.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Use of estimates</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:.35pt'> </font>preparation<font style='letter-spacing:.35pt'> </font>of<font style='letter-spacing:.35pt'> </font>financial<font style='letter-spacing:.35pt'> </font>statements<font style='letter-spacing:.35pt'> </font>in<font style='letter-spacing:.35pt'> </font>conformity<font style='letter-spacing:.35pt'> </font>with<font style='letter-spacing:.35pt'> </font>GAAP<font style='letter-spacing:-.05pt'> </font>requires<font style='letter-spacing:.35pt'> </font>management<font style='letter-spacing:.35pt'> </font>to<font style='letter-spacing:.35pt'> </font>make<font style='letter-spacing:.35pt'> </font>estimates<font style='letter-spacing:.35pt'> </font>and<font style='letter-spacing:.35pt'> </font>assumptions<font style='letter-spacing:.35pt'> </font>that<font style='letter-spacing:.35pt'> </font>a<font style='letter-spacing:-.2pt'>f</font>fect<font style='letter-spacing:.35pt'> </font>the reported<font style='letter-spacing:.65pt'> </font>amounts<font style='letter-spacing:.65pt'> </font>of<font style='letter-spacing:.65pt'> </font>assets<font style='letter-spacing:.65pt'> </font>and<font style='letter-spacing:.7pt'> </font>liabilities<font style='letter-spacing:.65pt'> </font>and<font style='letter-spacing:.65pt'> </font>disclosure<font style='letter-spacing:.65pt'> </font>of<font style='letter-spacing:.65pt'> </font>contingent<font style='letter-spacing:.7pt'> </font>assets<font style='letter-spacing:.65pt'> </font>and<font style='letter-spacing:.65pt'> </font>liabilities<font style='letter-spacing:.65pt'> </font>at<font style='letter-spacing:.65pt'> </font>the<font style='letter-spacing:.7pt'> </font>date<font style='letter-spacing:.65pt'> </font>of<font style='letter-spacing:.65pt'> </font>the<font style='letter-spacing:.65pt'> </font>financial<font style='letter-spacing:.65pt'> </font>statements<font style='letter-spacing:.7pt'> </font>and<font style='letter-spacing:.65pt'> </font>the reported<font style='letter-spacing:.25pt'> </font>amount<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.25pt'> </font>revenues<font style='letter-spacing:.25pt'> </font>and<font style='letter-spacing:.3pt'> </font>expenses<font style='letter-spacing:.25pt'> </font>during<font style='letter-spacing:.25pt'> </font>the<font style='letter-spacing:.25pt'> </font>reporting<font style='letter-spacing:.25pt'> </font>period.<font style='letter-spacing:.3pt'> </font>Actual<font style='letter-spacing:.25pt'> </font>results<font style='letter-spacing:.25pt'> </font>could<font style='letter-spacing:.25pt'> </font>di<font style='letter-spacing:-.2pt'>f</font>fer<font style='letter-spacing:.25pt'> </font>from<font style='letter-spacing:.3pt'> </font>those<font style='letter-spacing:.25pt'> </font>estimates.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Cash and cash equivalents</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Cash<font style='letter-spacing:.55pt'> </font>and<font style='letter-spacing:.55pt'> </font>cash<font style='letter-spacing:.55pt'> </font>equivalents<font style='letter-spacing:.6pt'> </font>include<font style='letter-spacing:.55pt'> </font>cash<font style='letter-spacing:.55pt'> </font>in<font style='letter-spacing:.55pt'> </font>banks,<font style='letter-spacing:.6pt'> </font>money<font style='letter-spacing:.55pt'> </font>market<font style='letter-spacing:.55pt'> </font>funds,<font style='letter-spacing:.55pt'> </font>and<font style='letter-spacing:.6pt'> </font>certificates<font style='letter-spacing:.55pt'> </font>of<font style='letter-spacing:.55pt'> </font>term<font style='letter-spacing:.55pt'> </font>deposits<font style='letter-spacing:.6pt'> </font>with<font style='letter-spacing:.55pt'> </font>maturities<font style='letter-spacing:.55pt'> </font>of<font style='letter-spacing:.55pt'> </font>less<font style='letter-spacing:.6pt'> </font>than<font style='letter-spacing:.55pt'> </font>three months<font style='letter-spacing:.5pt'> </font>from<font style='letter-spacing:.5pt'> </font>inception,<font style='letter-spacing:.5pt'> </font>which<font style='letter-spacing:.5pt'> </font>are<font style='letter-spacing:.55pt'> </font>readily<font style='letter-spacing:.5pt'> </font>convertible<font style='letter-spacing:.5pt'> </font>to<font style='letter-spacing:.5pt'> </font>known<font style='letter-spacing:.55pt'> </font>amounts<font style='letter-spacing:.5pt'> </font>of<font style='letter-spacing:.5pt'> </font>cash<font style='letter-spacing:.5pt'> </font>and<font style='letter-spacing:.55pt'> </font>which,<font style='letter-spacing:.5pt'> </font>in<font style='letter-spacing:.5pt'> </font>the<font style='letter-spacing:.5pt'> </font>opinion<font style='letter-spacing:.55pt'> </font>of<font style='letter-spacing:.5pt'> </font>management,<font style='letter-spacing:.5pt'> </font>are<font style='letter-spacing:.5pt'> </font>subject<font style='letter-spacing:.55pt'> </font>to an<font style='letter-spacing:.2pt'> </font>insignificant<font style='letter-spacing:.2pt'> </font>risk<font style='letter-spacing:.2pt'> </font>of<font style='letter-spacing:.2pt'> </font>loss<font style='letter-spacing:.2pt'> </font>in<font style='letter-spacing:.2pt'> </font>value.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Property and equipment</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Property<font style='letter-spacing:1.55pt'> </font>and<font style='letter-spacing:1.55pt'> </font>equipment<font style='letter-spacing:1.55pt'> </font>is<font style='letter-spacing:1.55pt'> </font>stated<font style='letter-spacing:1.55pt'> </font>at<font style='letter-spacing:1.55pt'> </font>cost<font style='letter-spacing:1.55pt'> </font>less<font style='letter-spacing:1.55pt'> </font>accumulated<font style='letter-spacing:1.55pt'> </font>depreciation.<font style='letter-spacing:1.55pt'> </font>Depreciation<font style='letter-spacing:1.55pt'> </font>is<font style='letter-spacing:1.55pt'> </font>provided<font style='letter-spacing:1.6pt'> </font>for<font style='letter-spacing:1.55pt'> </font>on<font style='letter-spacing:1.55pt'> </font>a<font style='letter-spacing:1.55pt'> </font>straight-line<font style='letter-spacing:1.55pt'> </font>basis<font style='letter-spacing:1.55pt'> </font>over<font style='letter-spacing:1.55pt'> </font>the useful<font style='letter-spacing:.85pt'> </font>lives<font style='letter-spacing:.85pt'> </font>of<font style='letter-spacing:.85pt'> </font>the<font style='letter-spacing:.85pt'> </font>assets. For network service equipment, and furniture and fixtures, the useful life is ten and five years, respectively. Leasehold<font style='letter-spacing:.9pt'> </font>Improvements<font style='letter-spacing:.85pt'> </font>are<font style='letter-spacing:.85pt'> </font>depreciated<font style='letter-spacing:.85pt'> </font>over<font style='letter-spacing:.85pt'> </font>six years.<font style='letter-spacing:.25pt'> </font>Expenditures<font style='letter-spacing:.3pt'> </font>for<font style='letter-spacing:.3pt'> </font>additions<font style='letter-spacing:.25pt'> </font>and<font style='letter-spacing:.3pt'> </font>improvements<font style='letter-spacing:.3pt'> </font>are<font style='letter-spacing:.25pt'> </font>capitalized;<font style='letter-spacing:.3pt'> </font>repairs<font style='letter-spacing:.3pt'> </font>and<font style='letter-spacing:.25pt'> </font>maintenance<font style='letter-spacing:.3pt'> </font>are<font style='letter-spacing:.25pt'> </font>expensed<font style='letter-spacing:.3pt'> </font>as<font style='letter-spacing:.3pt'> </font>incurred.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Impairment of long-lived assets</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:.6pt'> </font>Company<font style='letter-spacing:.6pt'> </font>evaluates<font style='letter-spacing:.6pt'> </font>long-lived<font style='letter-spacing:.65pt'> </font>assets<font style='letter-spacing:.6pt'> </font>for<font style='letter-spacing:.6pt'> </font>impairment<font style='letter-spacing:.65pt'> </font>whenever<font style='letter-spacing:.6pt'> </font>events<font style='letter-spacing:.6pt'> </font>or<font style='letter-spacing:.6pt'> </font>changes<font style='letter-spacing:.65pt'> </font>in<font style='letter-spacing:.6pt'> </font>circumstances<font style='letter-spacing:.6pt'> </font>indicate<font style='letter-spacing:.65pt'> </font>that<font style='letter-spacing:.6pt'> </font>the<font style='letter-spacing:.6pt'> </font>carrying<font style='letter-spacing:.6pt'> </font>amount of<font style='letter-spacing:.65pt'> </font>an<font style='letter-spacing:.7pt'> </font>asset<font style='letter-spacing:.65pt'> </font>may<font style='letter-spacing:.7pt'> </font>not<font style='letter-spacing:.7pt'> </font>be<font style='letter-spacing:.65pt'> </font>recoverable.<font style='letter-spacing:.7pt'> </font>Recoverability<font style='letter-spacing:.7pt'> </font>of<font style='letter-spacing:.65pt'> </font>assets<font style='letter-spacing:.7pt'> </font>to<font style='letter-spacing:.7pt'> </font>be<font style='letter-spacing:.65pt'> </font>held<font style='letter-spacing:.7pt'> </font>and<font style='letter-spacing:.7pt'> </font>used<font style='letter-spacing:.65pt'> </font>is<font style='letter-spacing:.7pt'> </font>measured<font style='letter-spacing:.7pt'> </font>by<font style='letter-spacing:.65pt'> </font>a<font style='letter-spacing:.7pt'> </font>comparison<font style='letter-spacing:.65pt'> </font>of<font style='letter-spacing:.7pt'> </font>the<font style='letter-spacing:.7pt'> </font>carrying<font style='letter-spacing:.65pt'> </font>amount<font style='letter-spacing:.7pt'> </font>of the<font style='letter-spacing:.6pt'> </font>assets<font style='letter-spacing:.65pt'> </font>to<font style='letter-spacing:.65pt'> </font>future<font style='letter-spacing:.65pt'> </font>undiscounted<font style='letter-spacing:.65pt'> </font>cash<font style='letter-spacing:.6pt'> </font>flows<font style='letter-spacing:.65pt'> </font>to<font style='letter-spacing:.65pt'> </font>be<font style='letter-spacing:.65pt'> </font>generated<font style='letter-spacing:.65pt'> </font>by<font style='letter-spacing:.65pt'> </font>the<font style='letter-spacing:.6pt'> </font>asset.<font style='letter-spacing:.65pt'> </font>If<font style='letter-spacing:.65pt'> </font>such<font style='letter-spacing:.65pt'> </font>assets<font style='letter-spacing:.65pt'> </font>are<font style='letter-spacing:.65pt'> </font>considered<font style='letter-spacing:.6pt'> </font>to<font style='letter-spacing:.65pt'> </font>be<font style='letter-spacing:.65pt'> </font>impaired,<font style='letter-spacing:.65pt'> </font>the<font style='letter-spacing:.65pt'> </font>impairment<font style='letter-spacing:.65pt'> </font>to be<font style='letter-spacing:.75pt'> </font>recognized<font style='letter-spacing:.8pt'> </font>is<font style='letter-spacing:.8pt'> </font>measured<font style='letter-spacing:.8pt'> </font>as<font style='letter-spacing:.8pt'> </font>the<font style='letter-spacing:.8pt'> </font>amount<font style='letter-spacing:.75pt'> </font>by<font style='letter-spacing:.8pt'> </font>which<font style='letter-spacing:.8pt'> </font>the<font style='letter-spacing:.8pt'> </font>carrying<font style='letter-spacing:.8pt'> </font>amount<font style='letter-spacing:.8pt'> </font>of<font style='letter-spacing:.75pt'> </font>the<font style='letter-spacing:.8pt'> </font>assets<font style='letter-spacing:.8pt'> </font>exceeds<font style='letter-spacing:.8pt'> </font>the<font style='letter-spacing:.8pt'> </font>fair<font style='letter-spacing:.8pt'> </font>value<font style='letter-spacing:.8pt'> </font>of<font style='letter-spacing:.75pt'> </font>the<font style='letter-spacing:.8pt'> </font>assets.<font style='letter-spacing:.8pt'> </font>The<font style='letter-spacing:.8pt'> </font>Company has<font style='letter-spacing:.3pt'> </font>not<font style='letter-spacing:.35pt'> </font>recognized<font style='letter-spacing:.35pt'> </font>impairment<font style='letter-spacing:.35pt'> </font>losses.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Indefinite lived intangible assets</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>The<font style='letter-spacing:1.1pt'> </font>Company<font style='letter-spacing:1.1pt'> </font>reviews<font style='letter-spacing:1.15pt'> </font>propert<font style='letter-spacing:-.65pt'>y</font>,<font style='letter-spacing:1.1pt'> </font>plant<font style='letter-spacing:1.15pt'> </font>and<font style='letter-spacing:1.1pt'> </font>equipment,<font style='letter-spacing:1.1pt'> </font>inventory<font style='letter-spacing:1.15pt'> </font>component<font style='letter-spacing:1.1pt'> </font>prepayments<font style='letter-spacing:1.15pt'> </font>and<font style='letter-spacing:1.1pt'> </font>certain<font style='letter-spacing:1.15pt'> </font>identifiable<font style='letter-spacing:1.1pt'> </font>intangibles,<font style='letter-spacing:1.1pt'> </font>excluding goodwill,<font style='letter-spacing:1.95pt'> </font>for<font style='letter-spacing:1.9pt'> </font>impairment.<font style='letter-spacing:1.95pt'> </font>Long-lived<font style='letter-spacing:1.95pt'> </font>assets<font style='letter-spacing:1.95pt'> </font>are<font style='letter-spacing:1.95pt'> </font>reviewed<font style='letter-spacing:1.95pt'> </font>for<font style='letter-spacing:1.95pt'> </font>impairment<font style='letter-spacing:1.95pt'> </font>whenever<font style='letter-spacing:1.95pt'> </font>events<font style='letter-spacing:1.95pt'> </font>or<font style='letter-spacing:1.95pt'> </font>changes<font style='letter-spacing:1.95pt'> </font>in<font style='letter-spacing:1.95pt'> </font>circumstances<font style='letter-spacing:1.95pt'> </font>indicate<font style='letter-spacing:1.95pt'> </font>the carrying<font style='letter-spacing:.6pt'> </font>amount<font style='letter-spacing:.6pt'> </font>of<font style='letter-spacing:.65pt'> </font>an<font style='letter-spacing:.6pt'> </font>asset<font style='letter-spacing:.65pt'> </font>may<font style='letter-spacing:.6pt'> </font>not<font style='letter-spacing:.65pt'> </font>be<font style='letter-spacing:.6pt'> </font>recoverable.<font style='letter-spacing:.65pt'> </font>Recoverability<font style='letter-spacing:.6pt'> </font>of<font style='letter-spacing:.6pt'> </font>these<font style='letter-spacing:.65pt'> </font>assets<font style='letter-spacing:.6pt'> </font>is<font style='letter-spacing:.65pt'> </font>measured<font style='letter-spacing:.6pt'> </font>by<font style='letter-spacing:.65pt'> </font>comparison<font style='letter-spacing:.6pt'> </font>of<font style='letter-spacing:.65pt'> </font>their<font style='letter-spacing:.6pt'> </font>carrying<font style='letter-spacing:.6pt'> </font>amounts to<font style='letter-spacing:.25pt'> </font>future<font style='letter-spacing:.3pt'> </font>undiscounted<font style='letter-spacing:.3pt'> </font>cash<font style='letter-spacing:.3pt'> </font>flows<font style='letter-spacing:.3pt'> </font>the<font style='letter-spacing:.3pt'> </font>assets<font style='letter-spacing:.3pt'> </font>are<font style='letter-spacing:.3pt'> </font>expected<font style='letter-spacing:.3pt'> </font>to<font style='letter-spacing:.3pt'> </font>generate.<font style='letter-spacing:.3pt'> </font>If<font style='letter-spacing:.3pt'> </font>propert<font style='letter-spacing:-.65pt'>y</font>,<font style='letter-spacing:.3pt'> </font>plant<font style='letter-spacing:.3pt'> </font>and<font style='letter-spacing:.3pt'> </font>equipment,<font style='letter-spacing:.3pt'> </font>inventory<font style='letter-spacing:.3pt'> </font>component<font style='letter-spacing:.3pt'> </font>prepayments and<font style='letter-spacing:1.8pt'> </font>certain<font style='letter-spacing:1.8pt'> </font>identifiable<font style='letter-spacing:1.8pt'> </font>intangibles<font style='letter-spacing:1.8pt'> </font>are<font style='letter-spacing:1.8pt'> </font>considered<font style='letter-spacing:1.8pt'> </font>to<font style='letter-spacing:1.8pt'> </font>be<font style='letter-spacing:1.8pt'> </font>impaired,<font style='letter-spacing:1.8pt'> </font>the<font style='letter-spacing:1.8pt'> </font>impairment<font style='letter-spacing:1.8pt'> </font>to<font style='letter-spacing:1.8pt'> </font>be<font style='letter-spacing:1.85pt'> </font>recognized<font style='letter-spacing:1.8pt'> </font>equals<font style='letter-spacing:1.8pt'> </font>the<font style='letter-spacing:1.8pt'> </font>amount<font style='letter-spacing:1.8pt'> </font>by<font style='letter-spacing:1.8pt'> </font>which<font style='letter-spacing:1.8pt'> </font>the carrying<font style='letter-spacing:.2pt'> </font>value<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.2pt'> </font>the<font style='letter-spacing:.25pt'> </font>assets<font style='letter-spacing:.2pt'> </font>exceeds<font style='letter-spacing:.25pt'> </font>its<font style='letter-spacing:.2pt'> </font>fair<font style='letter-spacing:.25pt'> </font>value.<font style='letter-spacing:.25pt'> </font>The<font style='letter-spacing:.2pt'> </font>Company<font style='letter-spacing:.25pt'> </font>has<font style='letter-spacing:.2pt'> </font>not<font style='letter-spacing:.25pt'> </font>recorded<font style='letter-spacing:.2pt'> </font>any<font style='letter-spacing:.25pt'> </font>related<font style='letter-spacing:.2pt'> </font>impairment<font style='letter-spacing:.25pt'> </font>losses.</font></p> <p style='margin:0in;margin-bottom:.0001pt;margin-top:.9pt;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;line-height:11.0pt'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:.35pt'> </font>Company<font style='letter-spacing:.35pt'> </font>does<font style='letter-spacing:.35pt'> </font>not<font style='letter-spacing:.4pt'> </font>amortize<font style='letter-spacing:.35pt'> </font>goodwill<font style='letter-spacing:.35pt'> </font>and<font style='letter-spacing:.35pt'> </font>intangible<font style='letter-spacing:.4pt'> </font>assets<font style='letter-spacing:.35pt'> </font>with<font style='letter-spacing:.35pt'> </font>indefinite<font style='letter-spacing:.35pt'> </font>useful<font style='letter-spacing:.4pt'> </font>lives,<font style='letter-spacing:.35pt'> </font>rather<font style='letter-spacing:.35pt'> </font>such<font style='letter-spacing:.35pt'> </font>assets<font style='letter-spacing:.4pt'> </font>are<font style='letter-spacing:.35pt'> </font>required<font style='letter-spacing:.35pt'> </font>to<font style='letter-spacing:.4pt'> </font>be<font style='letter-spacing:.35pt'> </font>tested<font style='letter-spacing:.35pt'> </font>for impairment<font style='letter-spacing:1.95pt'> </font>at<font style='letter-spacing:1.95pt'> </font>least<font style='letter-spacing:1.95pt'> </font>annually<font style='letter-spacing:1.95pt'> </font>or<font style='letter-spacing:1.95pt'> </font>sooner<font style='letter-spacing:1.95pt'> </font>whenever<font style='letter-spacing:1.95pt'> </font>events<font style='letter-spacing:1.95pt'> </font>or<font style='letter-spacing:1.95pt'> </font>changes<font style='letter-spacing:1.95pt'> </font>in<font style='letter-spacing:1.95pt'> </font>circumstances<font style='letter-spacing:1.95pt'> </font>indicate<font style='letter-spacing:1.95pt'> </font>that<font style='letter-spacing:1.95pt'> </font>the<font style='letter-spacing:2.0pt'> </font>assets<font style='letter-spacing:1.95pt'> </font>may<font style='letter-spacing:1.95pt'> </font>be<font style='letter-spacing:1.95pt'> </font>impaired.<font style='letter-spacing:1.95pt'> </font>The Company<font style='letter-spacing:.25pt'> </font>has<font style='letter-spacing:.3pt'> </font>not<font style='letter-spacing:.3pt'> </font>recorded<font style='letter-spacing:.3pt'> </font>any<font style='letter-spacing:.3pt'> </font>related<font style='letter-spacing:.25pt'> </font>impairment<font style='letter-spacing:.3pt'> </font>losses.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Revenue recognition</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>We adopted ASC 606 on August 1, 2018. Revenue is measured based on a consideration specified in a contract or agreement with a customer. The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to a customer. Incidental items that are immaterial in the context of the contract are recognized as expense. Unearned revenues are recorded when cash payments are received or due in advance of the performance of the services. Taxes assessed by a governmental authority that are both imposed on and concurrent with a specific revenue-producing transaction, that are collected by the Company from a customer, are excluded from revenue.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:2.25pt'> </font>Company&#146;s revenues consist primarily of subscription agreements for its broadband internet and voice-over-IP phone services. Residential broadband service delivered to customers over the Company&#146;s hybrid fiber and wireless network in Atlantic County, New Jersey is the primary revenue source. Revenues are supplemented by phone and add-on services. Broadband services delivered via fiber optics to enterprise businesses account for the remaining sources of revenue. Services are billed monthly to subscribers on either a one- year or two-year contract for residential customers and three-year contracts for enterprise business customers. Revenue begins accruing as service is delivered at commencement of the customer&#146;s service contract.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Revenue is recorded net of discounts provided to customers. Discounts applied during the quarter ended October 31, 2018 and 2017 were $3,287 and $6,319, respectively.</p> 3287 6319 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Income taxes</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:1.55pt'> </font>Company<font style='letter-spacing:1.55pt'> </font>accounts<font style='letter-spacing:1.55pt'> </font>for<font style='letter-spacing:1.55pt'> </font>income<font style='letter-spacing:1.55pt'> </font>taxes<font style='letter-spacing:1.55pt'> </font>using<font style='letter-spacing:1.55pt'> </font>the<font style='letter-spacing:1.55pt'> </font>asset<font style='letter-spacing:1.55pt'> </font>and<font style='letter-spacing:1.55pt'> </font>liability<font style='letter-spacing:1.55pt'> </font>method<font style='letter-spacing:1.55pt'> </font>in<font style='letter-spacing:1.6pt'> </font>accordance<font style='letter-spacing:1.55pt'> </font>with<font style='letter-spacing:1.55pt'> </font>ASC<font style='letter-spacing:1.55pt'> </font>740,<font style='letter-spacing:1.55pt'> </font>&#147;Accounting<font style='letter-spacing:1.55pt'> </font>for<font style='letter-spacing:1.55pt'> </font>Income <font style='letter-spacing:-.7pt'>T</font>axes&#148;.<font style='letter-spacing:.1pt'> </font>The<font style='letter-spacing:.15pt'> </font>asset<font style='letter-spacing:.1pt'> </font>and<font style='letter-spacing:.15pt'> </font>liability<font style='letter-spacing:.1pt'> </font>method<font style='letter-spacing:.1pt'> </font>provides<font style='letter-spacing:.15pt'> </font>that<font style='letter-spacing:.1pt'> </font>deferred<font style='letter-spacing:.15pt'> </font>tax<font style='letter-spacing:.1pt'> </font>assets<font style='letter-spacing:.15pt'> </font>and<font style='letter-spacing:.1pt'> </font>liabilities<font style='letter-spacing:.15pt'> </font>are<font style='letter-spacing:.1pt'> </font>recognized<font style='letter-spacing:.15pt'> </font>for<font style='letter-spacing:.1pt'> </font>the<font style='letter-spacing:.15pt'> </font>expected<font style='letter-spacing:.1pt'> </font>future<font style='letter-spacing:.15pt'> </font>tax consequences<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.3pt'> </font>temporary<font style='letter-spacing:.25pt'> </font>di<font style='letter-spacing:-.2pt'>f</font>ferences<font style='letter-spacing:.3pt'> </font>between<font style='letter-spacing:.25pt'> </font>the<font style='letter-spacing:.3pt'> </font>financial<font style='letter-spacing:.25pt'> </font>reporting<font style='letter-spacing:.3pt'> </font>and<font style='letter-spacing:.25pt'> </font>tax<font style='letter-spacing:.3pt'> </font>bases<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.3pt'> </font>assets<font style='letter-spacing:.25pt'> </font>and<font style='letter-spacing:.3pt'> </font>liabilities<font style='letter-spacing:.25pt'> </font>and<font style='letter-spacing:.3pt'> </font>for<font style='letter-spacing:.25pt'> </font>operating<font style='letter-spacing:.3pt'> </font>loss<font style='letter-spacing:.25pt'> </font>and<font style='letter-spacing:.3pt'> </font>tax credit<font style='letter-spacing:.65pt'> </font>carry<font style='letter-spacing:.65pt'> </font>forwards.<font style='letter-spacing:.65pt'> </font>Deferred<font style='letter-spacing:.65pt'> </font>tax<font style='letter-spacing:.65pt'> </font>assets<font style='letter-spacing:.65pt'> </font>and<font style='letter-spacing:.65pt'> </font>liabilities<font style='letter-spacing:.65pt'> </font>are<font style='letter-spacing:.65pt'> </font>measured<font style='letter-spacing:.65pt'> </font>using<font style='letter-spacing:.65pt'> </font>the<font style='letter-spacing:.65pt'> </font>currently<font style='letter-spacing:.65pt'> </font>enacted<font style='letter-spacing:.65pt'> </font>tax<font style='letter-spacing:.65pt'> </font>rates<font style='letter-spacing:.65pt'> </font>and<font style='letter-spacing:.65pt'> </font>laws<font style='letter-spacing:.65pt'> </font>that<font style='letter-spacing:.65pt'> </font>will<font style='letter-spacing:.65pt'> </font>be<font style='letter-spacing:.7pt'> </font>in<font style='letter-spacing:.65pt'> </font>e<font style='letter-spacing:-.2pt'>f</font>fect when<font style='letter-spacing:.3pt'> </font>the<font style='letter-spacing:.3pt'> </font>di<font style='letter-spacing:-.2pt'>f</font>ferences<font style='letter-spacing:.3pt'> </font>are<font style='letter-spacing:.35pt'> </font>expected<font style='letter-spacing:.3pt'> </font>to<font style='letter-spacing:.3pt'> </font>reverse.<font style='letter-spacing:.3pt'> </font>The<font style='letter-spacing:.3pt'> </font>Company<font style='letter-spacing:.35pt'> </font>records<font style='letter-spacing:.3pt'> </font>a<font style='letter-spacing:.3pt'> </font>valuation<font style='letter-spacing:.3pt'> </font>allowance<font style='letter-spacing:.35pt'> </font>to<font style='letter-spacing:.3pt'> </font>reduce<font style='letter-spacing:.3pt'> </font>deferred<font style='letter-spacing:.3pt'> </font>tax<font style='letter-spacing:.35pt'> </font>assets<font style='letter-spacing:.3pt'> </font>to<font style='letter-spacing:.3pt'> </font>the<font style='letter-spacing:.3pt'> </font>amount<font style='letter-spacing:.35pt'> </font>that is<font style='letter-spacing:.15pt'> </font>believed<font style='letter-spacing:.2pt'> </font>more<font style='letter-spacing:.2pt'> </font>likely<font style='letter-spacing:.2pt'> </font>than<font style='letter-spacing:.2pt'> </font>not<font style='letter-spacing:.2pt'> </font>to<font style='letter-spacing:.2pt'> </font>be<font style='letter-spacing:.2pt'> </font>realized.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Fair value measurements</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>The<font style='letter-spacing:.35pt'> </font>Company<font style='letter-spacing:.35pt'> </font>adopted<font style='letter-spacing:.4pt'> </font>the<font style='letter-spacing:.35pt'> </font>provisions<font style='letter-spacing:.4pt'> </font>of<font style='letter-spacing:.35pt'> </font>ASC<font style='letter-spacing:.4pt'> </font><font style='letter-spacing:-.7pt'>T</font>opic<font style='letter-spacing:.35pt'> </font>820,<font style='letter-spacing:.4pt'> </font>&#147;Fair<font style='letter-spacing:.35pt'> </font><font style='letter-spacing:-1.1pt'>V</font>alue<font style='letter-spacing:.4pt'> </font>Measurements<font style='letter-spacing:.35pt'> </font>and<font style='letter-spacing:.4pt'> </font>Disclosures&#148;,<font style='letter-spacing:.35pt'> </font>which<font style='letter-spacing:.4pt'> </font>defines<font style='letter-spacing:.35pt'> </font>fair<font style='letter-spacing:.4pt'> </font>value<font style='letter-spacing:.35pt'> </font>as<font style='letter-spacing:.4pt'> </font>used<font style='letter-spacing:.35pt'> </font>in numerous<font style='letter-spacing:1.25pt'> </font>accounting<font style='letter-spacing:1.3pt'> </font>pronouncements,<font style='letter-spacing:1.3pt'> </font>establishes<font style='letter-spacing:1.25pt'> </font>a<font style='letter-spacing:1.3pt'> </font>framework<font style='letter-spacing:1.3pt'> </font>for<font style='letter-spacing:1.25pt'> </font>measuring<font style='letter-spacing:1.3pt'> </font>fair<font style='letter-spacing:1.3pt'> </font>value<font style='letter-spacing:1.25pt'> </font>and<font style='letter-spacing:1.3pt'> </font>expands<font style='letter-spacing:1.3pt'> </font>disclosure<font style='letter-spacing:1.25pt'> </font>of<font style='letter-spacing:1.3pt'> </font>fair<font style='letter-spacing:1.3pt'> </font>value measurements.</font></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify;line-height:108%'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-top:3.9pt;margin-right:0in;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;line-height:108%'><font style='line-height:108%'>The<font style='letter-spacing:1.05pt'> </font>estimated<font style='letter-spacing:1.1pt'> </font>fair<font style='letter-spacing:1.1pt'> </font>value<font style='letter-spacing:1.1pt'> </font>of<font style='letter-spacing:1.1pt'> </font>certain<font style='letter-spacing:1.1pt'> </font>financial<font style='letter-spacing:1.1pt'> </font>instruments,<font style='letter-spacing:1.1pt'> </font>including<font style='letter-spacing:1.1pt'> </font>cash<font style='letter-spacing:1.1pt'> </font>and<font style='letter-spacing:1.05pt'> </font>cash<font style='letter-spacing:1.1pt'> </font>equivalents<font style='letter-spacing:1.1pt'> </font>are<font style='letter-spacing:1.1pt'> </font>carried<font style='letter-spacing:1.1pt'> </font>at<font style='letter-spacing:1.1pt'> </font>historical<font style='letter-spacing:1.1pt'> </font>cost<font style='letter-spacing:1.1pt'> </font>basis,<font style='letter-spacing:1.1pt'> </font>which approximates<font style='letter-spacing:.25pt'> </font>their<font style='letter-spacing:.25pt'> </font>fair<font style='letter-spacing:.3pt'> </font>values<font style='letter-spacing:.25pt'> </font>because<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.25pt'> </font>the<font style='letter-spacing:.3pt'> </font>short-term<font style='letter-spacing:.25pt'> </font>nature<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.3pt'> </font>these<font style='letter-spacing:.25pt'> </font>instruments.</font></p> <p style='margin:0in;margin-bottom:.0001pt;margin-top:.15pt;text-align:justify;line-height:14.0pt'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>ASC<font style='letter-spacing:.8pt'> </font>820<font style='letter-spacing:.8pt'> </font>defines<font style='letter-spacing:.8pt'> </font>fair<font style='letter-spacing:.85pt'> </font>value<font style='letter-spacing:.8pt'> </font>as<font style='letter-spacing:.8pt'> </font>the<font style='letter-spacing:.85pt'> </font>exchange<font style='letter-spacing:.8pt'> </font>price<font style='letter-spacing:.8pt'> </font>that<font style='letter-spacing:.85pt'> </font>would<font style='letter-spacing:.8pt'> </font>be<font style='letter-spacing:.8pt'> </font>received<font style='letter-spacing:.8pt'> </font>for<font style='letter-spacing:.85pt'> </font>an<font style='letter-spacing:.8pt'> </font>asset<font style='letter-spacing:.8pt'> </font>or<font style='letter-spacing:.85pt'> </font>paid<font style='letter-spacing:.8pt'> </font>to<font style='letter-spacing:.8pt'> </font>transfer<font style='letter-spacing:.85pt'> </font>a<font style='letter-spacing:.8pt'> </font>liability<font style='letter-spacing:.8pt'> </font>(an<font style='letter-spacing:.85pt'> </font>exit<font style='letter-spacing:.8pt'> </font>price)<font style='letter-spacing:.8pt'> </font>in<font style='letter-spacing:.8pt'> </font>the principal<font style='letter-spacing:.45pt'> </font>or<font style='letter-spacing:.5pt'> </font>most<font style='letter-spacing:.5pt'> </font>advantageous<font style='letter-spacing:.45pt'> </font>market<font style='letter-spacing:.5pt'> </font>for<font style='letter-spacing:.5pt'> </font>the<font style='letter-spacing:.45pt'> </font>asset<font style='letter-spacing:.5pt'> </font>or<font style='letter-spacing:.5pt'> </font>liability<font style='letter-spacing:.5pt'> </font>in<font style='letter-spacing:.45pt'> </font>an<font style='letter-spacing:.5pt'> </font>orderly<font style='letter-spacing:.5pt'> </font>transaction<font style='letter-spacing:.45pt'> </font>between<font style='letter-spacing:.5pt'> </font>market<font style='letter-spacing:.5pt'> </font>participants<font style='letter-spacing:.45pt'> </font>on<font style='letter-spacing:.5pt'> </font>the<font style='letter-spacing:.5pt'> </font>measurement date.<font style='letter-spacing:.4pt'> </font>ASC<font style='letter-spacing:.4pt'> </font>820<font style='letter-spacing:.4pt'> </font>also<font style='letter-spacing:.4pt'> </font>establishes<font style='letter-spacing:.4pt'> </font>a<font style='letter-spacing:.4pt'> </font>fair<font style='letter-spacing:.4pt'> </font>value<font style='letter-spacing:.4pt'> </font>hierarch<font style='letter-spacing:-.65pt'>y</font>,<font style='letter-spacing:.4pt'> </font>which<font style='letter-spacing:.4pt'> </font>requires<font style='letter-spacing:.4pt'> </font>an<font style='letter-spacing:.4pt'> </font>entity<font style='letter-spacing:.4pt'> </font>to<font style='letter-spacing:.4pt'> </font>maximize<font style='letter-spacing:.4pt'> </font>the<font style='letter-spacing:.4pt'> </font>use<font style='letter-spacing:.45pt'> </font>of<font style='letter-spacing:.4pt'> </font>observable<font style='letter-spacing:.4pt'> </font>inputs<font style='letter-spacing:.4pt'> </font>and<font style='letter-spacing:.4pt'> </font>minimize<font style='letter-spacing:.4pt'> </font>the use<font style='letter-spacing:.2pt'> </font>of<font style='letter-spacing:.2pt'> </font>unobservable<font style='letter-spacing:.2pt'> </font>inputs<font style='letter-spacing:.2pt'> </font>when<font style='letter-spacing:.25pt'> </font>measuring<font style='letter-spacing:.2pt'> </font>fair<font style='letter-spacing:.2pt'> </font>value.<font style='letter-spacing:.2pt'> </font>ASC<font style='letter-spacing:.2pt'> </font>820<font style='letter-spacing:.25pt'> </font>describes<font style='letter-spacing:.2pt'> </font>three<font style='letter-spacing:.2pt'> </font>levels<font style='letter-spacing:.2pt'> </font>of<font style='letter-spacing:.25pt'> </font>inputs<font style='letter-spacing:.2pt'> </font>that<font style='letter-spacing:.2pt'> </font>may<font style='letter-spacing:.2pt'> </font>be<font style='letter-spacing:.2pt'> </font>used<font style='letter-spacing:.25pt'> </font>to<font style='letter-spacing:.2pt'> </font>measure<font style='letter-spacing:.2pt'> </font>fair<font style='letter-spacing:.2pt'> </font>value:</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Level<font style='letter-spacing:.2pt'> </font>1<font style='letter-spacing:.2pt'> </font>&#151;<font style='letter-spacing:.2pt'> </font>quoted<font style='letter-spacing:.2pt'> </font>prices<font style='letter-spacing:.25pt'> </font>in<font style='letter-spacing:.2pt'> </font>active<font style='letter-spacing:.2pt'> </font>markets<font style='letter-spacing:.2pt'> </font>for<font style='letter-spacing:.25pt'> </font>identical<font style='letter-spacing:.2pt'> </font>assets<font style='letter-spacing:.2pt'> </font>or<font style='letter-spacing:.2pt'> </font>liabilities</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Level<font style='letter-spacing:.15pt'> </font>2<font style='letter-spacing:.2pt'> </font>&#151;<font style='letter-spacing:.2pt'> </font>quoted<font style='letter-spacing:.2pt'> </font>prices<font style='letter-spacing:.2pt'> </font>for<font style='letter-spacing:.2pt'> </font>similar<font style='letter-spacing:.15pt'> </font>assets<font style='letter-spacing:.2pt'> </font>and<font style='letter-spacing:.2pt'> </font>liabilities<font style='letter-spacing:.2pt'> </font>in<font style='letter-spacing:.2pt'> </font>active<font style='letter-spacing:.2pt'> </font>markets<font style='letter-spacing:.15pt'> </font>or<font style='letter-spacing:.2pt'> </font>inputs<font style='letter-spacing:.2pt'> </font>that<font style='letter-spacing:.2pt'> </font>are<font style='letter-spacing:.2pt'> </font>observable </p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Level<font style='letter-spacing:.2pt'> </font>3<font style='letter-spacing:.2pt'> </font>&#151;<font style='letter-spacing:.25pt'> </font>inputs<font style='letter-spacing:.2pt'> </font>that<font style='letter-spacing:.25pt'> </font>are<font style='letter-spacing:.2pt'> </font>unobservable<font style='letter-spacing:.25pt'> </font>(for<font style='letter-spacing:.2pt'> </font>example<font style='letter-spacing:.2pt'> </font>cash<font style='letter-spacing:.25pt'> </font>flow<font style='letter-spacing:.2pt'> </font>modeling<font style='letter-spacing:.25pt'> </font>inputs<font style='letter-spacing:.2pt'> </font>based<font style='letter-spacing:.25pt'> </font>on<font style='letter-spacing:.2pt'> </font>assumptions) The<font style='letter-spacing:.15pt'> </font>Company<font style='letter-spacing:.2pt'> </font>has<font style='letter-spacing:.2pt'> </font>no<font style='letter-spacing:.2pt'> </font>assets<font style='letter-spacing:.2pt'> </font>or<font style='letter-spacing:.2pt'> </font>liabilities<font style='letter-spacing:.2pt'> </font>valued<font style='letter-spacing:.2pt'> </font>at<font style='letter-spacing:.2pt'> </font>fair<font style='letter-spacing:.2pt'> </font>value<font style='letter-spacing:.2pt'> </font>on<font style='letter-spacing:.2pt'> </font>a<font style='letter-spacing:.2pt'> </font>recurring<font style='letter-spacing:.2pt'> </font>basis.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Consolidation of financial statements</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Hammer<font style='letter-spacing:2.1pt'> </font>Fiber<font style='letter-spacing:2.15pt'> </font>Optics<font style='letter-spacing:2.1pt'> </font>Holdings<font style='letter-spacing:2.15pt'> </font>Corp.<font style='letter-spacing:2.15pt'> </font>is<font style='letter-spacing:2.1pt'> </font>the<font style='letter-spacing:2.15pt'> </font>parent<font style='letter-spacing:2.15pt'> </font>company<font style='letter-spacing:2.1pt'> </font>and<font style='letter-spacing:2.15pt'> </font>sole<font style='letter-spacing:2.1pt'> </font>shareholder<font style='letter-spacing:2.15pt'> </font>of<font style='letter-spacing:2.15pt'> </font>Hammer<font style='letter-spacing:2.1pt'> </font><font style='letter-spacing:-.4pt'>W</font>ireless<font style='letter-spacing:2.15pt'> </font>Corporation.<font style='letter-spacing:2.15pt'> </font>The<font style='letter-spacing:2.1pt'> </font>financial statements<font style='letter-spacing:.35pt'> </font>for<font style='letter-spacing:.4pt'> </font>Hammer<font style='letter-spacing:.4pt'> </font>Fiber<font style='letter-spacing:.4pt'> </font>Optics<font style='letter-spacing:.4pt'> </font>Holdings<font style='letter-spacing:.4pt'> </font>Corp.<font style='letter-spacing:.4pt'> </font>and<font style='letter-spacing:.4pt'> </font>its<font style='letter-spacing:.4pt'> </font>wholly-owned<font style='letter-spacing:.4pt'> </font>subsidiaries<font style='letter-spacing:.4pt'> </font>are<font style='letter-spacing:.4pt'> </font>reported<font style='letter-spacing:.4pt'> </font>on<font style='letter-spacing:.4pt'> </font>a<font style='letter-spacing:.4pt'> </font>consolidated<font style='letter-spacing:.4pt'> </font>basis.<font style='letter-spacing:.4pt'> </font>All<font style='letter-spacing:.4pt'> </font>significant intercompany<font style='letter-spacing:.35pt'> </font>accounts<font style='letter-spacing:.35pt'> </font>and<font style='letter-spacing:.4pt'> </font>transactions<font style='letter-spacing:.35pt'> </font>have<font style='letter-spacing:.4pt'> </font>been<font style='letter-spacing:.35pt'> </font>eliminated.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Basic and Diluted Earnings (Loss) per Common Share</i></b></p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:1.95pt'> </font>basic<font style='letter-spacing:1.95pt'> </font>earnings<font style='letter-spacing:1.95pt'> </font>(loss)<font style='letter-spacing:1.95pt'> </font>per<font style='letter-spacing:1.95pt'> </font>share<font style='letter-spacing:1.95pt'> </font>are<font style='letter-spacing:1.95pt'> </font>calculated<font style='letter-spacing:1.95pt'> </font>by<font style='letter-spacing:1.95pt'> </font>dividing<font style='letter-spacing:1.95pt'> </font>the<font style='letter-spacing:1.95pt'> </font>Company's<font style='letter-spacing:1.95pt'> </font>net<font style='letter-spacing:1.95pt'> </font>income<font style='letter-spacing:1.95pt'> </font>available<font style='letter-spacing:1.95pt'> </font>to<font style='letter-spacing:1.95pt'> </font>common<font style='letter-spacing:1.95pt'> </font>shareholders<font style='letter-spacing:1.95pt'> </font>by<font style='letter-spacing:1.95pt'> </font>the weighted<font style='letter-spacing:.2pt'> </font>average<font style='letter-spacing:.2pt'> </font>number<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.2pt'> </font>common<font style='letter-spacing:.25pt'> </font>shares<font style='letter-spacing:.2pt'> </font>during<font style='letter-spacing:.25pt'> </font>the<font style='letter-spacing:.2pt'> </font>yea<font style='letter-spacing:-.55pt'>r</font>.<font style='letter-spacing:.25pt'> </font>The<font style='letter-spacing:.2pt'> </font>diluted<font style='letter-spacing:.25pt'> </font>earnings<font style='letter-spacing:.2pt'> </font>(loss)<font style='letter-spacing:.25pt'> </font>per<font style='letter-spacing:.2pt'> </font>share<font style='letter-spacing:.25pt'> </font>is<font style='letter-spacing:.2pt'> </font>calculated<font style='letter-spacing:.25pt'> </font>by dividing the Company's<font style='letter-spacing:.5pt'> </font>net<font style='letter-spacing:.5pt'> </font>income<font style='letter-spacing:.5pt'> </font>(loss)<font style='letter-spacing:.45pt'> </font>available<font style='letter-spacing:.5pt'> </font>to<font style='letter-spacing:.5pt'> </font>common<font style='letter-spacing:.5pt'> </font>shareholders<font style='letter-spacing:.5pt'> </font>by<font style='letter-spacing:.5pt'> </font>the<font style='letter-spacing:.5pt'> </font>diluted<font style='letter-spacing:.5pt'> </font>weighted<font style='letter-spacing:.5pt'> </font>average<font style='letter-spacing:.5pt'> </font>number<font style='letter-spacing:.5pt'> </font>of<font style='letter-spacing:.5pt'> </font>shares<font style='letter-spacing:.5pt'> </font>outstanding<font style='letter-spacing:.5pt'> </font>during<font style='letter-spacing:.5pt'> </font>the yea<font style='letter-spacing:-.55pt'>r</font>.<font style='letter-spacing:1.45pt'> </font>The<font style='letter-spacing:1.45pt'> </font>diluted<font style='letter-spacing:1.45pt'> </font>weighted<font style='letter-spacing:1.45pt'> </font>average<font style='letter-spacing:1.45pt'> </font>number<font style='letter-spacing:1.45pt'> </font>of<font style='letter-spacing:1.5pt'> </font>shares<font style='letter-spacing:1.45pt'> </font>outstanding<font style='letter-spacing:1.45pt'> </font>is<font style='letter-spacing:1.45pt'> </font>the<font style='letter-spacing:1.45pt'> </font>basic<font style='letter-spacing:1.45pt'> </font>weighted<font style='letter-spacing:1.5pt'> </font>number<font style='letter-spacing:1.45pt'> </font>of<font style='letter-spacing:1.45pt'> </font>shares<font style='letter-spacing:1.45pt'> </font>adjusted<font style='letter-spacing:1.45pt'> </font>for<font style='letter-spacing:1.45pt'> </font>any<font style='letter-spacing:1.45pt'> </font>potentially dilutive<font style='letter-spacing:.35pt'> </font>debt<font style='letter-spacing:.4pt'> </font>or<font style='letter-spacing:.35pt'> </font>equit<font style='letter-spacing:-.65pt'>y</font>.<font style='letter-spacing:.4pt'> </font>Diluted<font style='letter-spacing:.35pt'> </font>earnings<font style='letter-spacing:.4pt'> </font>(loss)<font style='letter-spacing:.35pt'> </font>per<font style='letter-spacing:.4pt'> </font>share<font style='letter-spacing:.35pt'> </font>are<font style='letter-spacing:.4pt'> </font>the<font style='letter-spacing:.35pt'> </font>same<font style='letter-spacing:.4pt'> </font>as<font style='letter-spacing:.35pt'> </font>basic<font style='letter-spacing:.4pt'> </font>earnings<font style='letter-spacing:.35pt'> </font>(loss)<font style='letter-spacing:.4pt'> </font>per<font style='letter-spacing:.35pt'> </font>share<font style='letter-spacing:.4pt'> </font>due<font style='letter-spacing:.35pt'> </font>to<font style='letter-spacing:.4pt'> </font>the<font style='letter-spacing:.35pt'> </font>lack<font style='letter-spacing:.4pt'> </font>of<font style='letter-spacing:.35pt'> </font>dilutive<font style='letter-spacing:.4pt'> </font>items<font style='letter-spacing:.35pt'> </font>in the<font style='letter-spacing:.2pt'> </font>Compan<font style='letter-spacing:-.65pt'>y</font>.<font style='letter-spacing:.25pt'> </font>As<font style='letter-spacing:.25pt'> </font>of<font style='letter-spacing:.25pt'> </font>October 31, and<font style='letter-spacing:.25pt'> </font>July 31, 2018,<font style='letter-spacing:.2pt'> </font>there<font style='letter-spacing:.25pt'> </font>were<font style='letter-spacing:.25pt'> </font>no<font style='letter-spacing:.25pt'> </font>common<font style='letter-spacing:.2pt'> </font>stock<font style='letter-spacing:.25pt'> </font>equivalents<font style='letter-spacing:.25pt'> </font>outstanding.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in'><b><i>Recent accounting pronouncements</i></b></p> <p style='margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>In June 2018, the FASB issued ASU No. 2018-07, Compensation &#150; Stock Compensation (Topic 718) (&#147;ASU 2018-07&#148;). ASU 2018-07 provides for improvements to nonemployee share-based payment accounting by expanding the scope of Topic 718 to include share-based payment transactions for acquiring goods and services from nonemployees. The awards will be measured at grant date, consistent with accounting for employee share-based payment awards. The measurement date has been redefined as the date at which the grantor and grantee reach a mutual understanding of the key terms and conditions of the award. The requirement to reassess classification of equity-classified awards upon vesting has been eliminated. We do not expect the adoption of this standard to have a material impact on the Company&#146;s financial statements. The Company adopted ASU 2018-07 August 1, 2018.</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>In February 2016, FASB issued ASU No. 2016-02, Accounting Standards Update No. 2016-02, Leases (Topic 842).&#160; ASU 2016-02 provides for improvements for accounting guidance related to a leasing treatments on financial statements as a response to user input. The update maintains two classifications of leases, Financial lease and Operating leases.&#160;&#160; The Update is effective for fiscal years beginning after December 2015, 2018.&#160; The company has not yet adopted this standard but there may be impact to the presentation of the Company&#146;s financial statements during the period of adoption.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'><b>NOTE 4 &#150; COMMITMENTS AND LEASES</b></p> <p style='margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-left:0in;text-align:justify'><font style='font-weight:normal'>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.</font></p> <p style='margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-top:0in;margin-right:6.0pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;line-height:108%'><font style='line-height:108%'>The future minimum lease payments are provided below.</font></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-top:0in;margin-right:6.0pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;line-height:108%'>&nbsp;</p> <div align="center"> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr style='height:.1in'> <td width="328" valign="top" style='width:245.7pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> </td> <td width="29" valign="top" style='width:22.05pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> </td> <td width="78" valign="top" style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'><b><u>Amount</u></b></p> </td> </tr> <tr style='height:.1in'> <td width="328" valign="top" style='width:245.7pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>For the fiscal year ended July 31, 2019</p> </td> <td width="29" valign="bottom" style='width:22.05pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>$</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>834,969</p> </td> </tr> <tr style='height:.1in'> <td width="328" valign="top" style='width:245.7pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>For the fiscal year ended July 31, 2020</p> </td> <td width="29" valign="bottom" style='width:22.05pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>820,464</p> </td> </tr> <tr style='height:.1in'> <td width="328" valign="top" style='width:245.7pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>For the fiscal year ended July 31, 2021</p> </td> <td width="29" valign="bottom" style='width:22.05pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>404,276</p> </td> </tr> <tr style='height:.1in'> <td width="328" valign="top" style='width:245.7pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>For the fiscal year ended July 31, 2022 </p> </td> <td width="29" valign="bottom" style='width:22.05pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>1,197,956</p> </td> </tr> <tr style='height:.1in'> <td width="328" valign="top" style='width:245.7pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-left:0in;text-align:justify'><font style='font-weight:normal'>For the fiscal year ended July 31, 2023 and thereafter</font></p> </td> <td width="29" valign="bottom" style='width:22.05pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-left:0in;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-left:0in;text-align:right'><font style='font-weight:normal'>-</font></p> </td> </tr> </table> </div> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-top:0in;margin-right:6.0pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;line-height:108%'>&nbsp;</p> <div align="center"> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr style='height:.1in'> <td width="328" valign="top" style='width:245.7pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> </td> <td width="29" valign="top" style='width:22.05pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> </td> <td width="78" valign="top" style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'><b><u>Amount</u></b></p> </td> </tr> <tr style='height:.1in'> <td width="328" valign="top" style='width:245.7pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>For the fiscal year ended July 31, 2019</p> </td> <td width="29" valign="bottom" style='width:22.05pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>$</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>834,969</p> </td> </tr> <tr style='height:.1in'> <td width="328" valign="top" style='width:245.7pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>For the fiscal year ended July 31, 2020</p> </td> <td width="29" valign="bottom" style='width:22.05pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>820,464</p> </td> </tr> <tr style='height:.1in'> <td width="328" valign="top" style='width:245.7pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>For the fiscal year ended July 31, 2021</p> </td> <td width="29" valign="bottom" style='width:22.05pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>404,276</p> </td> </tr> <tr style='height:.1in'> <td width="328" valign="top" style='width:245.7pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>For the fiscal year ended July 31, 2022 </p> </td> <td width="29" valign="bottom" style='width:22.05pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:right'>1,197,956</p> </td> </tr> <tr style='height:.1in'> <td width="328" valign="top" style='width:245.7pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p style='margin-left:0in;text-align:justify'><font style='font-weight:normal'>For the fiscal year ended July 31, 2023 and thereafter</font></p> </td> <td width="29" valign="bottom" style='width:22.05pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-left:0in;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt;height:.1in'> <p align="right" style='margin-left:0in;text-align:right'><font style='font-weight:normal'>-</font></p> </td> </tr> </table> </div> 834969 820464 404276 1197956 0 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'><b>NOTE 5 &#150; GOING CONCERN</b></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>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 for a period of one year from the issuance of these financial statements. The Company&#146;s 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.</font></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>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.</font></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>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.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'><b>NOTE 6 &#150; PROPERTY AND EQUIPMENT</b></p> <p style='margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>As of July 31, 2018, property and equipment consisted of the following:</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <div align="center"> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="16" valign="top" style='width:12.1pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><font style='letter-spacing:-.05pt'>Amount</font></p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="bottom" style='width:52.0pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>Life</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="16" valign="top" style='width:12.1pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="78" valign="top" style='width:58.5pt;border:none;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;border:none;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Computer<font style='letter-spacing:-.85pt'> </font>and<font style='letter-spacing:-.8pt'> </font>Telecom<font style='letter-spacing:-.8pt'> </font>equip<font style='letter-spacing:.1pt'>m</font>ent</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>4,636,066</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>5<font style='letter-spacing:-.5pt'> </font>years</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Building &amp; Structures</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>119,416</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>10<font style='letter-spacing:-.65pt'> </font>years</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Office<font style='letter-spacing:-.85pt'> </font>equipment,<font style='letter-spacing:-.85pt'> </font>furn<font style='letter-spacing:.1pt'>i</font>ture,<font style='letter-spacing:-.85pt'> </font>fixtures</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>94,287</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>5-6<font style='letter-spacing:-.65pt'> </font>years</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Computer<font style='letter-spacing:-1.35pt'> </font>software</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>79,952</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>3<font style='letter-spacing:-.5pt'> </font>years</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Capitalized<font style='letter-spacing:-.8pt'> </font>labor<font style='letter-spacing:-.8pt'> </font>costs</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>1,880,554</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>5<font style='letter-spacing:-.5pt'> </font>years</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Sub-total</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;border:none;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>6,810,275</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Less:<font style='letter-spacing:-1.1pt'> A</font>ccumulated<font style='letter-spacing:-1.05pt'> </font>depreciation and amortization</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>(2,216,640)</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Total</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$</p> </td> <td width="78" valign="bottom" style='width:58.5pt;border:none;border-bottom:double windowtext 1.5pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>4,593,635</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> </table> </div> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>Depreciation expense was $263,397 and $279,036 for the quarters ended October 31, 2018 and 2017, respectively.</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <div align="center"> <table border="0" cellspacing="0" cellpadding="0" style='border-collapse:collapse'> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="16" valign="top" style='width:12.1pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'><font style='letter-spacing:-.05pt'>Amount</font></p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="bottom" style='width:52.0pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>Life</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="16" valign="top" style='width:12.1pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="78" valign="top" style='width:58.5pt;border:none;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;border:none;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Computer<font style='letter-spacing:-.85pt'> </font>and<font style='letter-spacing:-.8pt'> </font>Telecom<font style='letter-spacing:-.8pt'> </font>equip<font style='letter-spacing:.1pt'>m</font>ent</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>4,636,066</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>5<font style='letter-spacing:-.5pt'> </font>years</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Building &amp; Structures</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>119,416</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>10<font style='letter-spacing:-.65pt'> </font>years</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Office<font style='letter-spacing:-.85pt'> </font>equipment,<font style='letter-spacing:-.85pt'> </font>furn<font style='letter-spacing:.1pt'>i</font>ture,<font style='letter-spacing:-.85pt'> </font>fixtures</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>94,287</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>5-6<font style='letter-spacing:-.65pt'> </font>years</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Computer<font style='letter-spacing:-1.35pt'> </font>software</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>79,952</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>3<font style='letter-spacing:-.5pt'> </font>years</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Capitalized<font style='letter-spacing:-.8pt'> </font>labor<font style='letter-spacing:-.8pt'> </font>costs</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>1,880,554</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>5<font style='letter-spacing:-.5pt'> </font>years</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Sub-total</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;border:none;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>6,810,275</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="center" style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Less:<font style='letter-spacing:-1.1pt'> A</font>ccumulated<font style='letter-spacing:-1.05pt'> </font>depreciation and amortization</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="78" valign="bottom" style='width:58.5pt;border:none;border-bottom:solid windowtext 1.0pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>(2,216,640)</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> </td> </tr> <tr style='height:.1in'> <td width="338" valign="top" style='width:253.4pt;padding:0;height:.1in'> <p style='margin:0in;margin-bottom:.0001pt'>Total</p> </td> <td width="16" valign="bottom" style='width:12.1pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>$</p> </td> <td width="78" valign="bottom" style='width:58.5pt;border:none;border-bottom:double windowtext 1.5pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>4,593,635</p> </td> <td width="18" valign="top" style='width:13.5pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> <td width="69" valign="top" style='width:52.0pt;padding:0;height:.1in'> <p align="right" style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</p> </td> </tr> </table> </div> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> 4636066 P5Y 119416 P10Y 94287 P5Y P6Y 79952 P3Y 1880554 P5Y 6810275 2216640 4593635 263397 279036 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'><b>NOTE 7 &#150; INDEFINITE LIVED INTANGIBLE ASSETS</b></p> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>The<font style='letter-spacing:.6pt'> </font>Company<font style='letter-spacing:.65pt'> </font>has<font style='letter-spacing:.65pt'> </font>$18,934<font style='letter-spacing:.6pt'> </font>of<font style='letter-spacing:.65pt'> </font>recognized<font style='letter-spacing:.65pt'> </font>indefinite<font style='letter-spacing:.6pt'> </font>lived<font style='letter-spacing:.65pt'> </font>intangible<font style='letter-spacing:.65pt'> </font>assets,<font style='letter-spacing:.65pt'> </font>which<font style='letter-spacing:.6pt'> </font>consist<font style='letter-spacing:.65pt'> </font>of<font style='letter-spacing:.65pt'> </font>the<font style='letter-spacing:.6pt'> </font>ownership<font style='letter-spacing:.65pt'> </font>of<font style='letter-spacing:.65pt'> </font>Internet<font style='letter-spacing:.65pt'> </font>Protocol<font style='letter-spacing:.6pt'> </font>version<font style='letter-spacing:.65pt'> </font>4 (IPv4)<font style='letter-spacing:.25pt'> </font>address<font style='letter-spacing:.25pt'> </font>blocks.<font style='letter-spacing:.3pt'> </font>These<font style='letter-spacing:.25pt'> </font>assets<font style='letter-spacing:.3pt'> </font>are<font style='letter-spacing:.25pt'> </font>not<font style='letter-spacing:.3pt'> </font>amortized<font style='letter-spacing:.25pt'> </font>and<font style='letter-spacing:.25pt'> </font>are<font style='letter-spacing:.3pt'> </font>evaluated<font style='letter-spacing:.25pt'> </font>routinely<font style='letter-spacing:.3pt'> </font>for<font style='letter-spacing:.25pt'> </font>potential<font style='letter-spacing:.3pt'> </font>impairment.<font style='letter-spacing:.25pt'> </font>If<font style='letter-spacing:.3pt'> </font>a<font style='letter-spacing:.25pt'> </font>determination<font style='letter-spacing:.25pt'> </font>is<font style='letter-spacing:.3pt'> </font>made<font style='letter-spacing:.25pt'> </font>that the<font style='letter-spacing:.8pt'> </font>intangible<font style='letter-spacing:.85pt'> </font>asset<font style='letter-spacing:.85pt'> </font>is<font style='letter-spacing:.8pt'> </font>impaired<font style='letter-spacing:.85pt'> </font>after<font style='letter-spacing:.85pt'> </font>performing<font style='letter-spacing:.85pt'> </font>the<font style='letter-spacing:.8pt'> </font>initial<font style='letter-spacing:.85pt'> </font>qualitative<font style='letter-spacing:.85pt'> </font>assessment,<font style='letter-spacing:.8pt'> </font>the<font style='letter-spacing:.85pt'> </font>asset<font style='letter-spacing:-.55pt'>&#146;</font>s<font style='letter-spacing:.85pt'> </font>fair<font style='letter-spacing:.85pt'> </font>value<font style='letter-spacing:.8pt'> </font>will<font style='letter-spacing:.85pt'> </font>be<font style='letter-spacing:.85pt'> </font>calculated<font style='letter-spacing:.85pt'> </font>and<font style='letter-spacing:.8pt'> </font>compared with<font style='letter-spacing:.25pt'> </font>the<font style='letter-spacing:.25pt'> </font>carrying<font style='letter-spacing:.25pt'> </font>value<font style='letter-spacing:.25pt'> </font>to<font style='letter-spacing:.25pt'> </font>determine<font style='letter-spacing:.25pt'> </font>whether<font style='letter-spacing:.25pt'> </font>an<font style='letter-spacing:.25pt'> </font>impairment<font style='letter-spacing:.25pt'> </font>loss<font style='letter-spacing:.25pt'> </font>should<font style='letter-spacing:.25pt'> </font>be<font style='letter-spacing:.25pt'> </font>recognized.</p> 18934 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'><b>NOTE 8 &#150; RELATED PARTY TRANSACTIONS</b></p> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>During<font style='letter-spacing:1.5pt'> </font>the<font style='letter-spacing:1.55pt'> </font>fiscal year ended July 31, 2016, the </font><font style='line-height:108%'>Company entered into two promissory notes with a related party</font><font style='line-height:108%'> for an aggregate amount of </font><font style='line-height:108%'>$2,400,000</font><font style='line-height:108%'> and </font><font style='line-height:108%'>$1,000,000</font><font style='line-height:108%'>, respectively. The $2,400,000 note matures on January 4, 2019. The </font><font style='line-height:108%'>terms consist of ten principal and interest payments due quarterly</font><font style='line-height:108%'> in the amount of $300,000 for total payments of $3,000,000. The Company is currently in default on this loan. To date, the Company has made payments on this note amounting to $725,831. The payments were applied to interest accrued as of the time of payment as well as to principal. The principal balance was </font><font style='line-height:108%'>$2,294,067</font><font style='line-height:108%'> at July 31, 2018 and 2017. The interest accrued was </font><font style='line-height:108%'>$219,434</font><font style='line-height:108%'> at July 31, 2018 and </font><font style='line-height:108%'>$69,594</font><font style='line-height:108%'> at July 31, 2017, respectively. </font></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>The $1,000,000 note matured on </font><font style='line-height:108%'>June 9, 2018</font><font style='line-height:108%'> at which time the principal became due in its entirety, in addition to simple interest accrued at </font><font style='line-height:108%'>3%</font><font style='line-height:108%'>. The company is currently in default on this loan. </font></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>For period ending October 31, 2018, 142,500 treasury shares were purchased by a Director of the Company, for cash of $142,500. As none of these shares were issued as of October 31, 2018, the full amount is reported in Shares to be issued, on the balance sheet (see also additional shares to be issued, as identified below in footnote 9).&#160; As of October 31, 2018, all of the related party payables are reported as current liabilities in the Consolidated Balance Sheet.</p> Company entered into two promissory notes with a related party 2400000 1000000 terms consist of ten principal and interest payments due quarterly 2294067 2294067 219434 69594 2018-06-09 0.0300 142500 142500 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'><b>NOTE 9 &#150; STOCKHOLDERS&#146; EQUITY</b></p> <p style='margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'><i>Treasury Stock</i></p> <p style='margin:0in;margin-bottom:.0001pt'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>In<font style='letter-spacing:1.75pt'> </font>July<font style='letter-spacing:1.75pt'> </font>2016,<font style='letter-spacing:1.8pt'> </font></font><font style='line-height:108%'>certain<font style='letter-spacing:1.75pt'> </font>shareholders<font style='letter-spacing:1.75pt'> </font>of<font style='letter-spacing:1.8pt'> </font>the<font style='letter-spacing:1.75pt'> </font>Company<font style='letter-spacing:1.8pt'> </font>contributed<font style='letter-spacing:1.75pt'> </font>9,291,670<font style='letter-spacing:1.75pt'> </font>restricted<font style='letter-spacing:1.8pt'> </font>shares<font style='letter-spacing:1.75pt'> </font>of<font style='letter-spacing:1.75pt'> </font>their<font style='letter-spacing:1.8pt'> </font>common<font style='letter-spacing:1.75pt'> </font>stock<font style='letter-spacing:1.8pt'> </font>to<font style='letter-spacing:1.75pt'> </font>the<font style='letter-spacing:1.75pt'> </font>Company<font style='letter-spacing:-.55pt'>&#146;</font>s wholly-owned<font style='letter-spacing:2.25pt'> </font>subsidiar<font style='letter-spacing:-.65pt'>y</font>,<font style='letter-spacing:2.25pt'> </font>Hammer<font style='letter-spacing:2.3pt'> </font><font style='letter-spacing:-.4pt'>W</font>ireless<font style='letter-spacing:2.25pt'> </font>Corporation</font><font style='line-height:108%'> (&#147;Treasury Shares&#148;),<font style='letter-spacing:2.25pt'> </font>for<font style='letter-spacing:2.3pt'> </font>the<font style='letter-spacing:2.25pt'> </font>purpose<font style='letter-spacing:2.25pt'> </font>of<font style='letter-spacing:2.3pt'> </font>e<font style='letter-spacing:-.2pt'>f</font>fecting<font style='letter-spacing:2.25pt'> </font>acquisitions,<font style='letter-spacing:2.3pt'> </font>joint<font style='letter-spacing:2.25pt'> </font>ventures<font style='letter-spacing:2.25pt'> </font>or<font style='letter-spacing:2.3pt'> </font>other<font style='letter-spacing:2.25pt'> </font>business combinations<font style='letter-spacing:1.65pt'> </font>with<font style='letter-spacing:1.65pt'> </font>third<font style='letter-spacing:1.65pt'> </font>parties. According to ASC 810-10-45 Consolidations, these shares are accounted for as treasury stock. </font></p> <p style='margin:0in;margin-bottom:.0001pt;margin-top:.9pt;line-height:11.0pt'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'><font style='line-height:108%'>During the three months ended October 31, 2018, the </font><font style='line-height:108%'>Company received cash of $184,700 from the sale of 255,700 treasury shares</font><font style='line-height:108%'>. 96,000 of these shares were sold at $0.35 per share; 142,500 of these shares were sold at $1 per share; and 17,200 shares were sold at $0.50 per share. Additionally, the </font><font style='line-height:108%'>Company issued 110,000 treasury shares to third parties for services provided</font><font style='line-height:108%'> during the period ended October 31, 2018. The Company valued these shares using the closing quoted price of the Company&#146;s common stock on the date of issuance. This resulted an increase in the Company&#146;s general and administrative expenses amounting to $49,340 in the first quarter of fiscal year 2019. Of the 255,700 treasury shares sold for cash during the period, </font><font style='line-height:108%'>238,500</font><font style='line-height:108%'> were yet to be issued as of October 31, 2018 (total value of </font><font style='line-height:108%'>$176,100</font><font style='line-height:108%'>).</font></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify;line-height:108%'>&nbsp;</p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>As a result of these transactions, the Company has a balance of 7,191,479 treasury shares as of October 31, 2018.</p> Company received cash of $184,700 from the sale of 255,700 treasury shares Company issued 110,000 treasury shares to third parties for services provided 238500 -176100 7191479 <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'><b>NOTE 10 &#150;SUBSEQUENT EVENTS</b></p> <p style='margin-top:0in;margin-right:0in;margin-bottom:0in;margin-left:46.55pt;margin-bottom:.0001pt;margin-left:0in;text-align:justify'>&nbsp;</p> <p style='margin-left:0in;text-align:justify'><font style='font-weight:normal;font-style:normal'>On </font><font style='font-weight:normal;font-style:normal'>September 11, 2018</font><font style='font-weight:normal;font-style:normal'> the </font><font style='font-weight:normal;font-style:normal'>Company entered into a stock purchase agreement with 1stPoint Communications, LLC</font><font style='font-weight:normal;font-style:normal'> (the &#147;Seller&#148;) for the purchase of their business.&#160; The acquisition was sought by the Company to complete ownership of key assets to support its hosted wireless services for entry into target markets. 1stPoint owns hosted carrier switching intellectual property for both voice and SMS, CLEC licenses in Florida and New York and a nationwide Commercial Mobile Radio Services license that will allow the company to move forward with its Everything Wireless integrated services strategy as well as hosting services that include cloud computing, virtual servers, virtual desktop and collaboration tools that will be used to advance the Company&#146;s hosted services platform. The managing member of 1stPoint Communications, LLC is the new CEO of Hammer Fiber. Additionally, the agreement contains a buyback provision that expires 180 days from the closing date. The purchase price for all of the Company Units is three million seven hundred and four thousand five hundred and seventeen (3,704,517) shares of the Company&#146;s Common Stock from treasury stock.&#160; Seventy five percent (75%) of the shares of the Company&#146;s 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.</font><font style='font-weight:normal;font-style:normal'>&#160; On November 1, 2018, the Company completed the previously announced purchase of 1stPoint Communications, LLC, whereby the Company acquired all of the outstanding equity ownership interests in 1stPoint Communications (the &#147;Acquisition&#148;).</font></p> <p style='margin-left:0in;text-align:justify'>&nbsp;</p> <p style='text-align:justify;layout-grid-mode:char'>On September 11, 2018 the Company entered into a stock purchase agreement with Shelcomm, Inc. (the &#147;Seller&#148;) for the purchase of their business. Shelcomm offers Pocket Paging, VoIP telephone and messaging solutions that will be used to support the assets acquired by 1stPoint and Endstream and support future Smart City deployments as part of the Company&#146;s Everything Wireless strategy. The Co-Chairman of Shelcomm, Inc. is the new CEO of Hammer Fiber; although, he has no management responsibilities with Shelcomm, Inc. Additionally, the agreement contains a buyback provision that expires 180 days from the closing date. The purchase price for all of the Company Units is one million (1,000,000) shares of the Company&#146;s Common Stock from treasury stock. The shares of the Company&#146;s 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.&#160; On November 1, 2018, the Company completed the previously announced purchase of Shelcomm, Inc., whereby the Company acquired all of the outstanding equity ownership interests in Shelcomm (the &#147;Acquisition&#148;).&#160; </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='text-align:justify;layout-grid-mode:char'>On September 12, 2018 the Company entered into a stock purchase agreement with Open Data Centers, LLC (the &#147;Seller&#148;) for the purchase of their business.&#160; The acquisition was a crucial component of the Company&#146;s future hosted services and wireless services platform.&#160; Open Data Centers operates a brick-and-mortar colocation facility to support the development of new Company infrastructure and provides 24x7 remote network operations to help management the existing assets as well as the newly acquired 1stPoint and Endstream assets. The managing member of Open Data Centers, LLC is the new CEO of Hammer Fiber. Additionally, the agreement contains a buyback provision that expires 180 days from the closing date. 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 Company&#146;s Common Stock from treasury stock.&#160; The shares of the Company&#146;s 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.&#160; On November 1, 2018, the Company completed the previously announced purchase of Open Data Centers, LLC whereby the Company acquired all of the outstanding equity ownership interests in Open Data Centers (the &#147;Acquisition&#148;).&#160; </p> <p style='margin:0in;margin-bottom:.0001pt;text-align:justify'>&nbsp;</p> <p style='margin-left:0in;text-align:justify;layout-grid-mode:char'><font style='font-weight:normal;font-style:normal'>On </font><font style='font-weight:normal;font-style:normal'>September 11, 2018</font><font style='font-weight:normal;font-style:normal'> the </font><font style='font-weight:normal;font-style:normal'>Company entered into a stock purchase agreement with Endstream Communications, LLC</font><font style='font-weight:normal;font-style:normal'> (the &#147;Seller&#148;) for the purchase of their business.&#160; The acquisition will bring new cash flow to the Company and will support its wireless service strategy through the offering of voice and messaging services.&#160; Endstream offers global VoIP termination, Direct Inbound Calling and Calling Card services which will be utilized by the Company in projects contemplated both in the US and internationally. The managing member of Endstream Communications, LLC is the new CEO of Hammer Fiber. Additionally, the agreement contains a buyback provision that expires 180 days from the closing date. The purchase price for all of the Company Units is one million nine hundred and eighty-eight thousand six hundred and sixteen (1,988,617) shares of the Company&#146;s Common Stock from treasury stock.&#160; 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.&#160; <font style='background:white'>Due to control of certain communications licenses by Endstream, pursuant to section 214 of the Communications Act of 1934, Endstream required Commission consent from the Federal Communications Commission (&#147;FCC&#148;) to transfer control of Endstream to the Company.&#160; On November 18, 2018 the FCC approved the transfer of control of Endstream Communications, LLC effective December 17, 2018. The Company and Endstream plan to close the same day.</font></font></p> 2018-09-11 Company entered into a stock purchase agreement with 1stPoint Communications, LLC 2018-09-11 Company entered into a stock purchase agreement with Shelcomm, Inc. 2018-09-12 Company entered into a stock purchase agreement with Open Data Centers, LLC 2018-09-11 Company entered into a stock purchase agreement with Endstream Communications, LLC 0001539680 2018-08-01 2018-10-31 0001539680 2018-10-31 0001539680 2018-12-14 0001539680 2018-12-14 2018-12-14 0001539680 2018-07-31 0001539680 2017-08-01 2017-10-31 0001539680 2017-07-31 0001539680 2017-10-31 0001539680 us-gaap:ComputerEquipmentMember 2018-07-31 0001539680 us-gaap:ComputerEquipmentMember 2018-07-31 2018-07-31 0001539680 us-gaap:BuildingAndBuildingImprovementsMember 2018-07-31 0001539680 us-gaap:BuildingAndBuildingImprovementsMember 2018-07-31 2018-07-31 0001539680 us-gaap:OfficeEquipmentMember 2018-07-31 0001539680 srt:MinimumMemberus-gaap:OfficeEquipmentMember 2018-07-31 2018-07-31 0001539680 srt:MaximumMemberus-gaap:OfficeEquipmentMember 2018-07-31 2018-07-31 0001539680 us-gaap:SoftwareAndSoftwareDevelopmentCostsMember 2018-07-31 0001539680 us-gaap:SoftwareAndSoftwareDevelopmentCostsMember 2018-07-31 2018-07-31 0001539680 us-gaap:OtherCapitalizedPropertyPlantAndEquipmentMember 2018-07-31 0001539680 us-gaap:OtherCapitalizedPropertyPlantAndEquipmentMember 2018-07-31 2018-07-31 0001539680 fil:PromissoryNoteWithRelatedPartyMember 2018-08-01 2018-10-31 0001539680 fil:PromissoryNoteWithRelatedParty1Member 2018-08-01 2018-10-31 0001539680 fil:PromissoryNoteWithRelatedParty2Member 2018-08-01 2018-10-31 0001539680 fil:PromissoryNoteWithRelatedPartyMember 2018-07-31 0001539680 fil:PromissoryNoteWithRelatedPartyMember 2017-07-31 0001539680 fil:PromissoryNoteWithRelatedParty2Member 2018-10-31 0001539680 fil:DuringTheNineMonthsEndedApril302018Member 2018-08-01 2018-10-31 0001539680 fil:OnSeptember182017Member 2018-08-01 2018-10-31 0001539680 fil:Event1Member 2018-08-01 2018-10-31 0001539680 fil:Event2Member 2018-08-01 2018-10-31 0001539680 fil:Event3Member 2018-08-01 2018-10-31 0001539680 fil:Event4Member 2018-08-01 2018-10-31 xbrli:pure iso4217:USD xbrli:shares iso4217:USD xbrli:shares EX-101.LAB 9 hmmr-20181031_lab.xml XBRL TAXONOMY EXTENSION LABELS LINKBASE DOCUMENT Subsequent Event Type Treasury shares were purchased, shares Represents the Treasury shares were purchased, shares (number of shares), during the indicated time period. Related Party [Axis] Consolidation of financial statements Policies NOTE 8 - RELATED PARTY TRANSACTIONS NOTE 7 - INDEFINITE LIVED INTANGIBLE ASSETS Services received paid with shares of stock Notes Payable - related party Property, Plant and Equipment, Net Property, Plant and Equipment, Net Entity Address, State or Province Registrant Name Event 2 Represents the Event 2, during the indicated time period. Debt Instrument, Maturity Date Property, Plant and Equipment, Gross Basic and Diluted Earnings (Loss) per Common Share NOTE 2 - CORPORATE HISTORY AND BACKGROUND ON MERGER Net Income (Loss) Common Stock, Shares, Outstanding Liabilities Liabilities Liabilities and Equity {1} Liabilities and Equity Phone Fax Number Description Current with reporting Recent accounting pronouncements Cash and cash equivalents {1} Cash and cash equivalents Notes Accrued interest {1} Accrued interest Retained Earnings (Accumulated Deficit) Accounts Receivable, net Entity Address, Postal Zip Code Amendment Description Ex Transition Period Voluntary filer Tax Identification Number (TIN) Common Stock, Shares Subscribed but Unissued Debt Instrument, Interest Rate, Stated Percentage Promissory Note with related party Represents the Promissory Note with related party, during the indicated time period. Schedule of Future Minimum Rental Payments for Operating Leases Impairment of long-lived assets NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Cash flows from financing activities: Loss per common share - basic and diluted Total operating expenses Total operating expenses Filer Category Event 4 Represents the Event 4, during the indicated time period. Event 3 Represents the Event 3, during the indicated time period. Long-term Debt Related Party Transaction, Description of Transaction Range [Axis] Capitalized labor costs For the fiscal year ended July 31, 2020 Proceeds from sale of shares of treasury stock Changes in operating assets and liabilities Common Stock, Shares Authorized Assets Assets Assets, Current Assets, Current Entity Address, Address Line One Emerging Growth Company Small Business Trading Symbol SEC Form During the nine months ended April 30, 2018 Represents the During the nine months ended April 30, 2018, during the indicated time period. Computer software Discounts Tables/Schedules NOTE 6 - PROPERTY AND EQUIPMENT Supplemental Cash Flow Information Interest income General and administrative Entity Address, City or Town Well-known Seasoned Issuer Interest Payable Promissory Note with related party - 1 Represents the Promissory Note with related party - 1, during the indicated time period. Range Property and equipment NOTE 10 - SUBSEQUENT EVENTS NOTE 4 - COMMITMENTS AND LEASES Operations and maintenance Liabilities, Current {1} Liabilities, Current On September 18, 2017 Represents the On September 18, 2017, during the indicated time period. Life Building & Structures For the fiscal year ended July 31, 2023 and thereafter Net increase (decrease) in cash Net increase (decrease) in cash Adjustments to reconcile net loss to net cash used in operating activities: REVENUE Liabilities and Equity Liabilities and Equity Stockholders' Equity Attributable to Parent Stockholders' Equity Attributable to Parent Common Stock, Share Subscribed but Unissued, Subscriptions Receivable Shares to be issued Other Assets, Current Fiscal Year End Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment For the fiscal year ended July 31, 2022 Acquisition of property and equipment Acquisition of property and equipment Interest Expense Interest Expense Operating Income (Loss) Operating Income (Loss) Liabilities, Current Liabilities, Current Accrued interest Accounts Payable, Current Amendment Flag Treasury Stock, Shares Statement [Line Items] Minimum Property, Plant and Equipment, Type [Axis] For the fiscal year ended July 31, 2019 Schedule of Property, Plant and Equipment OTHER INCOME AND EXPENSE Additional Paid in Capital Local Phone Number Entity Address, Address Description Document Fiscal Year Focus Registrant CIK Subsequent Event, Date Subsequent Event Type [Axis] Equity Method Investment, Additional Information Transaction Related Party Entity Incorporation, Date of Incorporation NOTE 9 - STOCKHOLDERS' EQUITY Net cash provided by financing activities Net cash provided by financing activities Cash flows from investing activities: Cash and cash equivalents Cash and cash equivalents Cash and cash equivalents Period End date Event 1 Represents the Event 1, during the indicated time period. For the fiscal year ended July 31, 2021 Use of estimates Basis of presentation Income Taxes Paid, Net Accounts payable Assets {1} Assets Entity Common Stock, Shares Outstanding Details Stock Issued During Period, Shares, Treasury Stock Reissued Related Party Transaction, Terms and Manner of Settlement Property, Plant and Equipment, Type NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS Interest Paid, Including Capitalized Interest, Operating and Investing Activities Total other income (expense) Total other income (expense) Depreciation and amortization Depreciation expense Total other assets Total other assets Intangible Assets, Net (Excluding Goodwill) Entity Listing, Par Value Per Share City Area Code Entity File Number Subsequent Event, Description Transaction Type [Axis] Related Party Transaction, Amounts of Transaction Computer and Telecom equipment Entity Information, Former Legal or Registered Name Net cash used in operating activities Net cash used in operating activities Accounts receivable Accounts receivable Costs and Expenses {1} Costs and Expenses Common Stock, Value, Issued Assets, Current {1} Assets, Current Public Float Maximum NOTE 5 - GOING CONCERN Other current assets Other current assets Common Stock, Par or Stated Value Per Share Current portion of long-term notes payable - related parties Shell Company Promissory Note with related party - 2 Represents the Promissory Note with related party - 2, during the indicated time period. Office equipment, furniture, fixtures Statement Fair value measurements Income taxes Revenue recognition Indefinite-lived intangible assets Repayment of loans Repayment of loans Cash flows from operating activities: Weighted Average Number of Shares Outstanding, Basic and Diluted NET LOSS NET LOSS Stockholders' Equity Attributable to Parent {1} Stockholders' Equity Attributable to Parent Transaction Date or Period Represents the description of Transaction Date or Period, during the indicated time period. Common Stock, Shares, Issued Entity Incorporation, State Country Name Document Fiscal Period Focus Treasury stock Treasury stock Deposits {1} Deposits EX-101.PRE 10 hmmr-20181031_pre.xml XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE DOCUMENT EX-101.SCH 11 hmmr-20181031.xsd XBRL TAXONOMY EXTENSION SCHEMA DOCUMENT 000240 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Fair value measurements (Policies) link:presentationLink link:definitionLink link:calculationLink 000110 - Disclosure - NOTE 6 - PROPERTY AND EQUIPMENT link:presentationLink link:definitionLink link:calculationLink 000060 - Disclosure - NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS link:presentationLink link:definitionLink link:calculationLink 000330 - Disclosure - NOTE 6 - PROPERTY AND EQUIPMENT: Schedule of Property, Plant and Equipment (Details) link:presentationLink link:definitionLink link:calculationLink 000310 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Revenue recognition (Details) link:presentationLink link:definitionLink link:calculationLink 000050 - Statement - Condensed Consolidated Statements of Cash Flows (unaudited) link:presentationLink link:definitionLink link:calculationLink 000200 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Impairment of long-lived assets (Policies) link:presentationLink link:definitionLink link:calculationLink 000180 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Cash and cash equivalents (Policies) link:presentationLink link:definitionLink link:calculationLink 000140 - Disclosure - NOTE 9 - STOCKHOLDERS' EQUITY link:presentationLink link:definitionLink link:calculationLink 000230 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Income taxes (Policies) link:presentationLink link:definitionLink link:calculationLink 000270 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Recent accounting pronouncements (Policies) link:presentationLink link:definitionLink link:calculationLink 000150 - Disclosure - NOTE 10 - SUBSEQUENT EVENTS link:presentationLink link:definitionLink link:calculationLink 000360 - Disclosure - NOTE 8 - RELATED PARTY TRANSACTIONS (Details) link:presentationLink link:definitionLink link:calculationLink 000120 - Disclosure - NOTE 7 - INDEFINITE LIVED INTANGIBLE ASSETS link:presentationLink link:definitionLink link:calculationLink 000250 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Consolidation of financial statements (Policies) link:presentationLink link:definitionLink link:calculationLink 000080 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES link:presentationLink link:definitionLink link:calculationLink 000340 - Disclosure - NOTE 6 - PROPERTY AND EQUIPMENT (Details) link:presentationLink link:definitionLink link:calculationLink 000170 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Use of estimates (Policies) link:presentationLink link:definitionLink link:calculationLink 000030 - Statement - Condensed Consolidated Balance Sheets (October 31, 2018 unaudited, July 31, 2018 restated) - Parenthetical link:presentationLink link:definitionLink link:calculationLink 000160 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Basis of presentation (Policies) link:presentationLink link:definitionLink link:calculationLink 000370 - Disclosure - NOTE 9 - STOCKHOLDERS' EQUITY (Details) link:presentationLink link:definitionLink link:calculationLink 000220 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Revenue recognition (Policies) link:presentationLink link:definitionLink link:calculationLink 000020 - Statement - Condensed Consolidated Balance Sheets (October 31, 2018 unaudited, July 31, 2018 restated) link:presentationLink link:definitionLink link:calculationLink 000260 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Basic and Diluted Earnings (Loss) per Common Share (Policies) link:presentationLink link:definitionLink link:calculationLink 000210 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Indefinite-lived intangible assets (Policies) link:presentationLink link:definitionLink link:calculationLink 000350 - Disclosure - NOTE 7 - INDEFINITE LIVED INTANGIBLE ASSETS (Details) link:presentationLink link:definitionLink link:calculationLink 000010 - Document - Document and Entity Information link:presentationLink link:definitionLink link:calculationLink 000100 - Disclosure - NOTE 5 - GOING CONCERN link:presentationLink link:definitionLink link:calculationLink 000070 - Disclosure - NOTE 2 - CORPORATE HISTORY AND BACKGROUND ON MERGER link:presentationLink link:definitionLink link:calculationLink 000300 - Disclosure - NOTE 2 - CORPORATE HISTORY AND BACKGROUND ON MERGER (Details) link:presentationLink link:definitionLink link:calculationLink 000090 - Disclosure - NOTE 4 - COMMITMENTS AND LEASES link:presentationLink link:definitionLink link:calculationLink 000040 - Statement - Condensed Consolidated Statement of Operations (unaudited) link:presentationLink link:definitionLink link:calculationLink 000280 - Disclosure - NOTE 4 - COMMITMENTS AND LEASES: Schedule of Future Minimum Rental Payments for Operating Leases (Tables) link:presentationLink link:definitionLink link:calculationLink 000130 - Disclosure - NOTE 8 - RELATED PARTY TRANSACTIONS link:presentationLink link:definitionLink link:calculationLink 000320 - Disclosure - NOTE 4 - COMMITMENTS AND LEASES: Schedule of Future Minimum Rental Payments for Operating Leases (Details) link:presentationLink link:definitionLink link:calculationLink 000380 - Disclosure - NOTE 10 - SUBSEQUENT EVENTS (Details) link:presentationLink link:definitionLink link:calculationLink 000290 - Disclosure - NOTE 6 - PROPERTY AND EQUIPMENT: Schedule of Property, Plant and Equipment (Tables) link:presentationLink link:definitionLink link:calculationLink 000190 - Disclosure - NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Property and equipment (Policies) link:presentationLink link:definitionLink link:calculationLink XML 12 R1.htm IDEA: XBRL DOCUMENT v3.10.0.1
Document and Entity Information - $ / shares
3 Months Ended
Dec. 14, 2018
Oct. 31, 2018
Jul. 31, 2018
Details      
Registrant Name   HAMMER FIBER OPTICS HOLDINGS CORP  
Registrant CIK   0001539680  
SEC Form   10-Q  
Period End date   Oct. 31, 2018  
Fiscal Year End   --07-31  
Trading Symbol   hmmr  
Tax Identification Number (TIN)   981032170  
Filer Category   Non-accelerated Filer  
Current with reporting   Yes  
Small Business   true  
Emerging Growth Company   true  
Ex Transition Period   false  
Amendment Flag   false  
Document Fiscal Year Focus   2019  
Document Fiscal Period Focus   Q1  
Entity File Number   000-1539680  
Entity Incorporation, State Country Name   Nevada  
Entity Address, Address Line One   15 Corporate Place South, Suite 100  
Entity Address, City or Town   Piscataway  
Entity Address, State or Province   NJ  
Entity Address, Postal Zip Code   08854  
Entity Address, Address Description   Address of principal executive offices  
City Area Code   844  
Local Phone Number   413-2600  
Phone Fax Number Description   Registrant’s telephone number, including area code  
Common Stock, Shares, Issued 60,503,341 60,503,341 60,503,341
Entity Listing, Par Value Per Share $ 0.001    
Entity Common Stock, Shares Outstanding 53,135,762    
XML 13 R2.htm IDEA: XBRL DOCUMENT v3.10.0.1
Condensed Consolidated Balance Sheets (October 31, 2018 unaudited, July 31, 2018 restated) - USD ($)
Oct. 31, 2018
Jul. 31, 2018
Assets, Current    
Cash and cash equivalents $ 1,150 $ 3,441
Accounts Receivable, net 22,185 19,332
Other Assets, Current 4,829 9,488
Assets, Current 28,164 32,261
Property, Plant and Equipment, Net 4,330,238 4,593,635
Intangible Assets, Net (Excluding Goodwill) 18,934 18,934
Total other assets 4,360,482 4,623,879
Assets 4,388,646 4,656,140
Deposits 11,310 11,310
Liabilities, Current    
Accounts Payable, Current 174,710 256,243
Notes Payable - related party 230,000 230,000
Current portion of long-term notes payable - related parties 3,394,067 3,394,067
Accrued interest 382,474 289,050
Liabilities, Current 4,181,251 4,169,360
Liabilities 4,181,251 4,169,360
Stockholders' Equity Attributable to Parent    
Common Stock, Value, Issued 60,503 60,503
Treasury stock 0 0
Shares to be issued 176,100 0
Additional Paid in Capital 14,675,659 14,617,719
Retained Earnings (Accumulated Deficit) (14,704,867) (14,191,442)
Stockholders' Equity Attributable to Parent 207,395 486,780
Liabilities and Equity $ 4,388,646 $ 4,656,140
XML 14 R3.htm IDEA: XBRL DOCUMENT v3.10.0.1
Condensed Consolidated Balance Sheets (October 31, 2018 unaudited, July 31, 2018 restated) - Parenthetical - $ / shares
Oct. 31, 2018
Jul. 31, 2018
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 52,946,162
XML 15 R4.htm IDEA: XBRL DOCUMENT v3.10.0.1
Condensed Consolidated Statement of Operations (unaudited) - USD ($)
3 Months Ended
Oct. 31, 2018
Oct. 31, 2017
Details    
REVENUE $ 47,232 $ 37,293
Costs and Expenses    
Operations and maintenance 5,597 2,207
General and administrative 195,686 2,109,169
Depreciation expense 263,397 279,036
Total operating expenses 464,680 2,390,412
Operating Income (Loss) (417,448) (2,353,119)
OTHER INCOME AND EXPENSE    
Interest Expense (95,977) (86,284)
Interest income 0 1,765
Total other income (expense) (95,977) (84,519)
NET LOSS $ (513,425) $ (2,437,638)
Weighted Average Number of Shares Outstanding, Basic and Diluted 53,031,038 52,180,159
Loss per common share - basic and diluted $ (0.01) $ (0.05)
XML 16 R5.htm IDEA: XBRL DOCUMENT v3.10.0.1
Condensed Consolidated Statements of Cash Flows (unaudited) - USD ($)
3 Months Ended
Oct. 31, 2018
Oct. 31, 2017
Cash flows from operating activities:    
Net Income (Loss) $ (513,425) $ (2,437,638)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation and amortization 263,397 279,036
Services received paid with shares of stock 49,340 943,500
Changes in operating assets and liabilities    
Accounts receivable (2,853) (7,565)
Other current assets 4,659 11,617
Accounts payable (81,533) (80,293)
Accrued interest 93,424 12,507
Net cash used in operating activities (186,991) (1,278,836)
Cash flows from investing activities:    
Acquisition of property and equipment 0 (389,830)
Cash flows from financing activities:    
Repayment of loans 0 (6,905)
Proceeds from sale of shares of treasury stock 184,700 1,398,508
Net cash provided by financing activities 184,700 1,391,603
Net increase (decrease) in cash (2,291) (277,063)
Cash and cash equivalents 3,441 528,380
Cash and cash equivalents 1,150 251,317
Supplemental Cash Flow Information    
Interest Paid, Including Capitalized Interest, Operating and Investing Activities 2,553 75,000
Income Taxes Paid, Net $ 5,774 $ 0
XML 17 R6.htm IDEA: XBRL DOCUMENT v3.10.0.1
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS
3 Months Ended
Oct. 31, 2018
Notes  
NOTE 1 - ORGANIZATION AND DESCRIPTION OF BUSINESS

NOTE 1 ORGANIZATION AND DESCRIPTION OF BUSINESS

 

Hammer Fiber Optics Holdings Corp. (“the Company”) is an alternative telecommunications carrier formed to provide high capacity broadband through a wireless access network. Hammer Fiber Optics Holdings Corp. is the parent company and sole shareholder of Hammer Wireless Corporation and Hammer Fiber Optic Investments Ltd. The financial statements for Hammer Fiber Optics Holdings Corp. and its wholly-owned subsidiary are reported on a consolidated basis. All significant intercompany accounts and transactions have been eliminated.

XML 18 R7.htm IDEA: XBRL DOCUMENT v3.10.0.1
NOTE 2 - CORPORATE HISTORY AND BACKGROUND ON MERGER
3 Months Ended
Oct. 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 Company’s 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 Company’s 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 shall become 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 provides 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 Company’s 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.

XML 19 R8.htm IDEA: XBRL DOCUMENT v3.10.0.1
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
3 Months Ended
Oct. 31, 2018
Notes  
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 3 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

Basis of presentation

 

The accompanying consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The interim financial statements for the fiscal quarter ending October 31, 2018 are unaudited. These financial statements are prepared in accordance with requirements for unaudited interim periods and consequently do not include all disclosures required to be in conformity with accounting principles generally accepted in the United States of America. The results of operations for the interim periods are not necessarily indicative of the results for the full year. In management's opinion, all adjustments necessary for a fair presentation of the Company's financial statements are reflected in the interim periods included and are of a normal recurring nature. These interim financial statements should be read in conjunction with the financial statements included in our Form 10-K, for the year ended July 31, 2018, as filed with the Securities and Exchange Commission (“the SEC”) at www.sec.gov.

 

Use of estimates

 

The preparation of financial statements in conformity with GAAP 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 amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.

 

Cash and cash equivalents

 

Cash and cash equivalents include cash in banks, money market funds, and certificates of term deposits with maturities of less than three months from inception, which are readily convertible to known amounts of cash and which, in the opinion of management, are subject to an insignificant risk of loss in value.

 

Property and equipment

 

Property and equipment is stated at cost less accumulated depreciation. Depreciation is provided for on a straight-line basis over the useful lives of the assets. For network service equipment, and furniture and fixtures, the useful life is ten and five years, respectively. Leasehold Improvements are depreciated over six years. Expenditures for additions and improvements are capitalized; repairs and maintenance are expensed as incurred.

 

Impairment of long-lived assets

 

The Company evaluates long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of the assets to future undiscounted cash flows to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the car