GLOBE NET WIRELESS CORP. - 10-Q - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

Edgar Glimpses |

GENERAL

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

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




RESULTS OF OPERATIONS



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

Nine-month Period Ended Compared to the Nine-month Period Ended .

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

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



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Three-month Period Ended Compared to the Three-month Period Ended .

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

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

LIQUIDITY AND CAPITAL RESOURCES

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

Stockholders' deficit increased from $93,962 as of to $105,059 as of

Cash Flows from Operating Activities



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

Cash Flows from Financing Activities

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

PLAN OF OPERATION AND FUNDING

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

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



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OFF-BALANCE SHEET ARRANGEMENTS

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



GOING CONCERN


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

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