UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDING MAY 31, 2017
COMMISSION FILE NUMBER: 333-207163
Momentous Holdings Corp.
(Exact name of registrant as specified in its charter)
| Nevada | 32-0471741 | |
|
(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
|
Suite 3, Floor 3, 148 Cambridge Heath Road, London, E1 5QJ, United Kingdom (Address of principal executive offices, including zip code)
+44 744 430 1337 (Registrant’s telephone number, including area code) |
Securities registered pursuant to Section 12(b) of the Act: Common Stock: $0.00 par value
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. [ ] Yes [X] No
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. [ ] Yes [X] No
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 Web site, if any, every Interactive Data Filed required to be submitted
and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant
was required to submit and post such files).
[ ] Yes [X] No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part iii of this Form 10-K or any amendments to this Form 10-K. [ ]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one)
| Large accelerated filer [ ] | Accelerated filer [ ] | |
| Non-accelerated filer [ ] | Smaller reporting company [X] | |
| Emerging growth company [X] |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed fiscal year end, May 31, 2017: 1.285 million shares are held by non-affiliates.
Indicate the number of shares outstanding of each of the registrant’s classes of common stock, as of the latest practicable date: There were 3,785,000 shares of common stock issued and outstanding at July 26, 2017. There were no shares of preferred stock issued and outstanding at July 26, 2017.
DOCUMENTS INCORPORATED BY REFERENCE
None.
| i |
A WARNING ABOUT FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, which are subject to a number of risks and uncertainties. All statements that are not historical facts are forward-looking statements, including statements about our business strategy, the effect of Generally Accepted Accounting Principles (“GAAP”) pronouncements, uncertainty regarding our future operating results and our profitability, anticipated sources of funds and all plans, objectives, expectations and intentions and the statements regarding future potential revenue. These statements appear in a number of places and can be identified by the use of forward-looking terminology such as “may,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “future,” “intend,” or “certain” or the negative of these terms or other variations or comparable terminology, or by discussions of strategy.
Actual results may vary materially from those in such forward-looking statements as a result of various factors that are identified in “Item 1A.— Risk Factors” and elsewhere in this document. No assurance can be given that the risk factors described in this Annual Report on Form 10-K are all of the factors that could cause actual results to vary materially from the forward-looking statements. References in this Annual Report on Form 10-K to (i) the “Company,” the “Registrant,” “Momentous” “we,” “our,” and “us” refer to MOMENTOUS HOLDINGS CORP.
Investors and security holders may obtain a free copy of the Annual Report on Form 10-K and other documents filed by MOMENTOUS HOLDINGS CORP. with the Securities and Exchange Commission (“SEC”) at the SEC’s website at http://www.sec.gov. Free copies of the Annual Report on Form 10-K and other documents filed by MOMENTOUS HOLDINGS CORP. with the SEC may also be obtained from MOMENTOUS HOLDINGS CORP. by directing a request to MOMENTOUS HOLDINGS CORP. Attention: James Horan, Suite 3, Floor 3, 148 Cambridge Heath Road,
London, E1 5QJ, United Kingdom
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Overview
Momentous Holdings Corp. (“MOMENTOUS” or the “Company”) was incorporated on May 29, 2015 in the State of Nevada. Our address is Suite 3, 3rd Floor, 148 Cambridge Heath Rd., London, E1 5QJ, United Kingdom. Our corporate address is a professional mail forwarding office where physical office space may be rented on a short-term basis for additional fees. We intend to conduct our business operations, including administrative functions, sales, marketing, and app development at the offices of our third-party developers, the personal residences of our officers, all of whom are currently in the United Kingdom; however, we will also be working remotely. Our corporate books and records will be maintained and stored with our legal counsel at: Booth Udall Fuller, 1255 W. Rio Salado Pkwy., Ste. 215, Tempe, AZ 85281. Our fixed equipment will be located at the personal residences of our officers. Our phone number is +44 744 430 1337. Our fiscal year end is May 31.
Prior to forming Momentous Holdings Corp., Mr. Horan, our founder and president, operated the business as a sole proprietor under the dba “Health & Fitness Apps”. He started the business on December 2, 2013, when he purchased a computer, and started working on product designs and the company’s website. The first sales occurred in early 2014, prior to the formation of Momentous Holdings Corp. Subsequently, Mr. Horan contributed the business assets and liabilities of his sole proprietorship into Momentous Holdings Corp., in exchange for 500,000 shares of our common stock.
We are a development stage company specializing in designing, acquiring and developing mobile applications (‘app/apps’) and mobile software for download by end consumers.
Currently we own Muscle Manager and Muscle Manager Pro apps, both available on Apple iTunes, and are unique apps that track users’ workout history and applies this to a physical representation of the user’s body. The ‘Manager’ screen allows users to clearly monitor those muscle groups users have worked on and those muscle groups that users have tended to neglect. Through this interactive body manager, users are clearly able to Track their exercise and help users achieve a total body workout.
Muscle Manager ‘Lite’ is a free download, as of May 31, 2017, 110,200 consumers had downloaded the app. As of the same date we had sold approximately 2,300 copies of the Muscle Manager Pro app, which retails at $1.99 per download.
Recent Developments
On December 31, 2015, Momentous Holdings Corp.’s S-1 registration became effective. A maximum of 5,000,000 shares of our common stock at an offering price of $0.04 per share were offered and we sold a total of 1,285,000.
Smaller reporting companies are not required to provide the information required by this item.
Item 1B. Unresolved Staff Comments
Not applicable.
Office Space and Plants
We do not own any real property. We maintain an address at Suite 3, 3rd Floor, 148 Cambridge Heath Road, London, E1 5QJ, United Kingdom. Our corporate address is a professional mail forwarding office where physical office space may be rented on a short-term basis for additional fees. Since the Company’s officers are working for the Company on a part-time basis, it is not necessary to rent any office space at this time.
Our business operations, including administrative functions, sales, marketing, and app development are performed at this address, the offices of the Company’s third party developers and the personal residences of our officers, all of whom are currently based in the United Kingdom; however, we will also be working remotely. Our corporate books and records are maintained and stored with our legal counsel at: Booth Udall Fuller, 1255 W. Rio Salado Pkwy., Ste. 215, Tempe, AZ 85281. Our fixed equipment is located at the personal residences of our officers.
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We are not currently a party to any legal proceedings. We are not aware of any pending legal proceeding to which any of our officers, directors, or any beneficial holders of 5% or more of our voting securities are adverse to us or have a material interest adverse to us.
Our agent for service of process in Nevada is Incsmart.biz, Inc., 1516 E. Tropicana Ave, Ste. 155, Las Vegas, NV. 89119.
Item 4. Mine Safety Disclosure
NA
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| Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
On December 31, 2015, our Form S-1 Registration Statement became effective, pursuant to which we have offered 5,000,000 shares for sale to the public and sold a total of 1,285,000 shares at $0.04 per share.
As of May 31, 2017, there were 3,785,000 shares of our common stock outstanding and 31 stockholders of record. We have not paid dividends on our common stock and do not anticipate paying dividends in the foreseeable future. Information required by Item 201(d) or Regulation S-K is included in Part III, Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
| Item 6. | Selected Financial Data |
| May 31, 2017 | May 31, 2016 | |||||||
| Revenue | $ | 176 | $ | 694 | ||||
| Operating Expenses | 34,521 | 24,739 | ||||||
| Earnings (Loss) | $ | (34,345 | ) | $ | (24,045 | ) | ||
| Total Assets | $ | 4,195 | $ | 38,319 | ||||
| Liabilities | 19,687 | 16,719 | ||||||
| Stockholders’ Deficit | $ | 15,492 | $ | (21,600 | ) | |||
| Item 7. | Management’s Discussion and Analysis of Financial Condition and Result of Operations |
The following discussion is intended to assist in the understanding and assessment of significant changes and trends related to the results of operations and financial condition of MOMENTOUS HOLDINGS CORP. This discussion and analysis should be read in conjunction with our financial statements and notes thereto included elsewhere in this Annual Report on Form 10-K for the fiscal year ended May 31, 2017.
Our Plan for the Next 12 Months
The following is a list of business goals and milestones we wish to accomplish within the next twelve months.
| · | Secure necessary funds | |
| · | Product Development, Facility and Equipment | |
| · | Engage in advertising and marketing | |
| · | Hire skilled employees to complete our team | |
| · | Pay for legal and accounting costs |
Our first major milestones will be securing funds and upping the scale of our production. This is our primary focus. In three years, we hope to have established our brand, apps and company in the United States, United Kingdom and internationally.
Product Development, Facility and Equipment
Should we secure sufficient funding we intend to develop our existing apps to include the following features with associated costs:
| 1. | Add a function that allows the recording of cardiovascular exercises. This feature would cost approximately $9,000 and would take a month to implement. |
| 2. | Include the ability for users to share completed training programs via social media/networking, such as Strava, map My Run, My Fitness Plan, Twitter, Instagram and Facebook. This allows people to share their work-outs and also promotes the app. This would be achieved within a few days and would cost approximately $2,000. |
We are discussions with a developer to implement these changes by August 2017.
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| 3. | Develop a feature that provides the user with suggested exercises once a particular muscle/muscle group is chosen. Also to include the ability to show exercises previously completed to explain users delayed onset muscle soreness (DOMS). This feature would also record previous exercises completed by the user to allow progress tracking and progress reports. The cost of these additions would be approximately $25,000 and take two months to implement. |
| 4. | Add a ‘shuffle’ feature in which the app randomly suggests a full body exercise program for any given day as opposed to ‘shuffling’ between the same muscle groups as the app currently does. This would cost approximately $7,600 and would take two weeks to implement. |
| 5. | After a workout the user is asked to grade their effort, this may not be accurate, particularly in beginners. The addition of a more detailed recording function to record sets/repetitions/time with beginner, intermediate, experience variations. Due to the complexity or calculating the required algorithms this would cost approximately $11,500 and one month to implement. |
| 6. | Add an additional feature to sell products through the app to include supplements, exercise clothing, footwear etc. This feature will allow us to develop our own clothing or retail other brands and provide a secondary revenue stream. This feature will take one month to develop and will cost approximately $8,000. |
| 7. | Add a function to illustrate a male or female muscular anatomy depending on the user, currently the app only shows a male muscular illustration. This required extensive programming and could cost between $3,800 and $7,600 and could be achieved within a month. |
As we currently outsource the development of our apps the above costs would hold true unless we employed our own developer. We estimate we could employ a proficient developer for around $55,000 per annum. This would allow us to implement the above changes and develop new apps. The cost of a new app developed by an external provider would be in excess of $25,000. Depending on our ability raise funding it may be more cost effective to employ a developer than outsource the development of our apps. This would also require us to purchase equipment and lease a facility. We suspect a suitable facility could be found for $15,000 and equipment costs would be in the region of $15,000 to include computers and software licenses.
As of May 31, 2017, we have begun developing our app to include features 2) and 4) above. We have outsourced the development of our app and expect the work to be completed by late 2017.
Advertising and Marketing
We intend to increase our marketing and web presence immediately/when funding is received. We intend to instruct a specialist search engine optimization (SEO) and marketing expert to help penetrate new market opportunities in the US, UK and other countries.
Our objectives are to: increase downloads of the free app globally and increase conversion rates from the ‘lite’ to the purchased version.
We estimate initially this will cost $2,750 per month for 20 hours of dedicated support. This can be increased to $4,000 per month for 50 hours and $7,300 per month for 100 hours should we raise sufficient funds. We will primarily look to focus on organic routes such as strong SEO and social media presence using Apple iTunes, Google AdWords, Facebook, Instagram and Twitter. Google AdWords for example allows you to choose where your ad appears, on which specific websites and in which geographical areas (states, towns, or even neighborhoods), allowing for targeted marketing.
We intend to scale back on advertising and marketing in the order of preference outlined above. Thus, for instance, if we intend to develop search engine optimization with less money involved in our marketing campaign. We will also consider our options with available revenues. We will implement these campaigns once we have developed our existing apps. It is important that we improve the app before increasing advertising. As sales have been seasonal we will try to develop the apps immediately to ensure marketing is implemented in line with seasonal downloads. A budget will be allocated to advertising once we have secured funding or gross profits allow within the next 3 to 6 months.
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Labor
We estimate we could employ a proficient developer for around $55,000 per annum. This would allow us to implement the above changes and develop new apps. The cost of a new app developed by an external provider would be in excess of $25,000. Depending on our ability raise additional funding it may be more cost effective to employ a developer than outsource the development of our apps. We intend to continue to outsource elements of the development process as required until such a time those full time employees are financially viable. We would expect this to be within the next 12-24 months though organic growth should we not receive sufficient funding to recruit immediately. Required training will be funded through revenues or proceeds of our offering and employees will be sent on formal training courses offered by suitable industry trainers. We intend to hire new employees depending on our development needs as funds are available. We expect this will be within the next 3 to 6 months and it will be prioritized in order of merit and depending on the increase in sales.
The following discussion of our financial condition and results of operations should be read in conjunction with our financial statements for the year ended May 31, 2017, together with notes thereto, and our financial statements for the year ended May 31, 2016, together with notes thereto, which are included in this Form 10-K.
Results of Operations
Revenues
Our revenue for the year ending May 31, 2017 and 2016 was $176 and $694 respectively.
We expect revenues to increase for the year ended May 31, 2018 as a result of increased sales resulting from improved app development. If we are able to additional funding, we hope to generate revenues from new apps, advertising and merchandise sales through our existing apps.
Operating Expenses
Operating expenses were $34,521 and $24,739 for the year ending May 31, 2017 and the year ended May 31, 2016, respectively.
We anticipate our operating expenses will increase as we undertake our plan of operations. The increase will be attributable to the measures described above to implement our business plan and the professional fees associated with our becoming a reporting company under the Securities Exchange Act of 1934.
Net Loss
Net loss for the year ending May 31, 2017 was $34,345. Our net loss for the year ended May 31, 2016 was $24,045.
The increase in net loss is attributable to the increase in professional fees.
Liquidity and Capital Resources
As of May 31, 2017, we had total assets of $4,195, consisting of cash of $3,967, accounts receivable of $40 and property and equipment of $188. We had current liabilities of $19,687 as of May 31, 2017. As of May 31, 2016 we had total assets of $38,319, consisting of cash of $37,154, prepaid expenses of $561, accounts receivable of $67 and property and equipment of $537. We had current liabilities of $16,719 as of May 31, 2016. Accordingly, we had a working capital deficit of $15,680 as of May 31, 2017 compared with a working capital surplus of $21,063 as of May 31, 2016.
Our ability to operate beyond May 31, 2017, is contingent upon us obtaining additional financing and/or upon realizing sales revenue sufficient to fund our ongoing expenses. Until we are able to sustain our ongoing operations through sales revenue, we intend to fund operations through debt and/or equity financing arrangements, which may be insufficient to fund our capital expenditures, working capital, or other cash requirements. We do not have any formal commitments or arrangements for the sales of stock or the advancement or loan of funds at this time. There can be no assurance that such additional financing will be available to us on acceptable terms, or at all.
Going Concern
Our assets at May 31, 2017 total $4,195. This amount does not provide adequate working capital for us to successfully operate our business and to service our debt. Expenses incurred to the date of this prospectus are being recorded our books as they occur. This raises substantial doubt about our ability to continue as a going concern. Our continuation as a going concern is dependent upon obtaining additional working capital.
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Item 7A. Quantitative and Qualitative Disclosures About Market Risk
As a smaller reporting Company, as defined by Item 10 of regulation S-K, the Company is not required to provide this information.
Item 8. Financial Statements and Supplementary Data
The financial statements appear beginning on page F-1, immediately following the signature page of this report.
Item 9. Changes in and Disagreements with Accountants and Financial Disclosure
None.
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officers to allow timely decisions regarding required disclosure.
We carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Securities Exchange Act Rules 13a-15(e) and 15d-15(e)) as of May 31, 2017. Based upon that evaluation, our Chief Executive Officers concluded that our disclosure controls and procedures were not effective as of May 31, 2017 due to lack of segregation of duties.
Evaluation of Internal Controls and Procedures
We are responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined by Securities Exchange Act Rule 13a-15(f). Our internal controls are designed to provide reasonable assurance as to the reliability of our financial statements for external purposes in accordance with accounting principles generally accepted in the United States.
Internal control over financial reporting has inherent limitations and may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable, not absolute, assurance with respect to financial statement preparation and presentation. Further, because of changes in conditions, the effectiveness of internal control over financial reporting may vary over time.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.
Under the supervision and with the participation of our Chief Executive Officers Officer, we have evaluated the effectiveness of our internal control over financial reporting as of May 31, 2017, as required by Securities Exchange Act Rule 13a-15(c). In making our assessment, we have utilized the criteria set forth by the 2013 Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. We concluded that based on our evaluation, our internal control over financial reporting was not effective as of May 31, 2017.
The Company is neither an accelerated filer nor a large accelerated filer, as defined in Rule 12b-2 under the Exchange Act, and there is not otherwise included in this Annual Report an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not required to be attested by the Company’s registered public accounting firm pursuant to Item 308(b) of Regulation S-K.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting that occurred during the fourth quarter ended May 31, 2017, or subsequent to the date the Company completed its evaluation, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
None.
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Item 10. Directors, Executive Officers and Corporate Governance
MOMENTOUS HOLDINGS CORP.’s executive officers and directors and their respective age as of May 31, 2017 are as follows:
Directors:
| Name of Director | Age |
| James Horan | 38 |
| Nooroa Ogden | 45 |
Executive Officers as of May 31, 2017:
The following table lists our directors and provides their respective ages and titles as of May 31, 2017:
| Name | Age | Title | Director Since | |||
| James Horan | 38 | Chief Executive Officer, President and Director | 2015 | |||
| A Nooroa Ogden | 45 | Chief Financial Officer, Secretary, Treasurer and Director | 2015 |
The term of office for each director is one year, or until the next annual meeting of the shareholders.
Biographical Information
Set forth below is a brief description of the background and business experience of our officers and director for the past year.
James Horan - President, CEO and Director
James Horan has been President, CEO and Director of our company since incorporation on May 29, 2015.
Prior to forming Momentous Holdings Corp., Mr. Horan, our founder and president, initially operated the business as a sole proprietor under the dba “Health & Fitness Apps”. He started the business in December 2013, with the first sales occurred in early 2014, prior to the formation of Momentous Holdings Corp. Revenues and profit have consistently grown since inception. Mr. Horan holds an MSc (hons) degree in Sport and Exercise Science, and is a YMCA certified Gym Instructor.
In addition to this, Mr. Horan has worked as a Personal Trainer from 2003 to present for both private clients and Home Health Fitness, a leading personal training firm operating in and around London. During this time, Mr. Horan has shared and taught his valuable health and fitness experience with hundreds of clients. Mr. Horan has also gained several additional sports qualifications, including being a BMC Rock Climbing Instructor, a PADI Dive Master, a BTCB Tae-Kwon-Do Instructor and a qualified First Aider.
Mr. Horan also has an outstanding track record as a Tae-Kwon-Do athlete, competing in the World Championships, European Championships, Student World Championships and the Olympic Games World Qualification between the years of 1996 and 2009. Through these years he was a Senior Irish National Team Member, and was National Team Captain from 2003-2009, subsequently coaching the Irish National squad for Olympic trials in 2012. Aside from that provided above, Mr. Horan does not hold and has not held over the past five years any other directorships in any company with a class of securities registered pursuant to Section 12 of the Exchange Act or subject to the requirements of Section 15(d) of the Exchange Act or any company registered as an investment company under the Investment Company Act of 1940. We believe that Mr. Horan’s experience as a fully qualified personal trainer and sports coach alongside his international competition experience provide him the qualifications, attributes and skills necessary to serve on the Board.
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Nooroa Ogden – Secretary, Treasurer and Director
Nooroa Ogden has been Secretary, Treasurer and Director of our company since September 15, 2015.
Mr. Ogden has extensive experience in the fitness industry having worked in the industry for over 16. From September 2014, Mr. Ogden has been employed as Head Trainer at Exerceo Training Limited. His responsibilities include training clients and Develop EMS (Electric Muscle Stimulation) training studios in London. Prior to his current role Mr. Ogden worked as a Personal Trainer for both private clients and clients of LA Fitness Limited in South Kensington from June 2006.
Mr. Ogden started his career in March 2000 with London Broncos RFC holding various roles including; Development Officer, academy assistant Coach and Strength and Conditioning Coach for all academies until June 2006.
Mr. Ogden is a Paul Chek Holistic Lifestyle Coach and a Faster Master Trainer which he obtained from the C.H.E.K Institute, London.
Corporate Governance
Nominating Committee. We have not established a Nominating Committee because of our limited operations; and because we have only one director and one officer, we believe that we are able to effectively manage the issues normally considered by a Nominating Committee.
Audit Committee. We have not established an Audit Committee because of our limited operations; and because we have only one director and one officer, we believe that we are able to effectively manage the issues normally considered by an Audit Committee.
Code of Ethics. We have not adopted a Code of Ethics for our principal executive and financial officer.
Item 11. Executive Summary and Compensation
Executive Compensation
|
Name and Position |
Fiscal Year |
Salary | Bonus |
Other annual Compensation |
Restricted Stock Award (s) |
Securities Underling Options |
LTIP Payouts |
All other Compensation | |
| James Horan | 2017 | $0 | 0 | 0 | 0 | 0 | 0 | $0 | |
| Nooroa Ogden | 2017 | $0 | 0 | 0 | 0 | 0 | 0 | $0 | |
| Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
The following table sets forth information regarding the beneficial ownership of our common stock as of May 31, 2017 by:
| · | each person or group of affiliated persons who we know beneficially owns more than 5% of our common stock; and |
| · | each of our directors and named executive officers; |
The information presented below regarding beneficial ownership of our voting securities has been presented in accordance with the rules of the Securities and Exchange Commission and is not necessarily indicative of ownership for any other purpose. Under these rules, a person is deemed to be a "beneficial owner" of a security if that person has or shares the power to vote or direct the voting of the security or the power to dispose or direct the disposition of the security. A person is deemed to own beneficially any security as to which such person has the right to acquire sole or shared voting or investment power within 60 days through the conversion or exercise of any convertible security, warrant, option or other right. More than one person may be deemed to be a beneficial owner of the same securities. The percentage of beneficial ownership by any person as of a particular date is calculated by dividing the number of shares beneficially owned by such person, which includes the number of shares as to which such person has the right to acquire voting or investment power within 60 days, by the sum of the number of shares outstanding as of such date plus the number of shares as to which such person has the right to acquire voting or investment power within 60 days. Consequently, the denominator used for calculating such percentage may be different for each beneficial owner. Except as otherwise indicated below and under applicable common share property laws, we believe that the beneficial owners of our common stock listed below have sole voting and investment power with respect to the shares shown. The business address of the shareholders set forth below is Suite 3, Floor 3, 148 Cambridge Heath Road, London, E1 5QJ, United Kingdom.
| NAME | TOTAL SHARES OWNED | PERCENTAGE |
| James Horan | 2,500,000 | 66.1% |
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Item 13. Certain Relationships and Related Transactions and Director Independence
During Fiscal Year 2017, there were no other material transactions between the Company and any officer, director or related party that has not been disclosed in footnote 5 to the financial statements. Additionally, there are no officers, directors or other related parties that since the date of incorporation, had any material interest, direct or indirect, in any transaction with us or in any presently proposed transaction that has or will materially affect us:
| · | The Officers and Directors; Any person proposed as a nominee for election as a director; |
| · | Any other person who beneficially owns, directly or indirectly, shares carrying more than 5% of the voting rights attached to the outstanding shares of common stock; |
| · | Any relative or spouse of any of the foregoing persons who have the same house as such person; and |
| · | Any future transactions between us and our Officers, Directors, and Affiliates will be on terms no less favorable to us than can be obtained from unaffiliated third parties. Such transactions with such persons will be subject to approval of our Board of Directors. |
The aggregate fees billed by our principal accountant for the audit of our annual financial statements, review of financial statements included in the quarterly reports and other fees that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for the fiscal years ended May 31, 2017 and May 31, 2016, were approximately $6,500 and $7,500 respectively.
Tax Fees
The fees billed for professional services rendered by our principal accountant for tax compliance, tax advice and tax planning for the fiscal years ended May 31, 2017 and 2016 were $1,000 respectively.
All other fees
There were no fees billed for other products or services provided by our principal accountant for 2017 or 2016.
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Item 15. Exhibits, Financial Statements, Schedules
(a) Financial Statements and Schedules.
The following documents have been filed as a part of this annual report on Form 10-K. The financial statements and schedules required to be filed hereunder are set forth at the end of this Annual Report on Form 10-K beginning on page F-1, and are accompanied by a Financial Statements Index.
Exhibits.
The Exhibit Index attached behind the signature page is incorporated herein by reference.
| Page | |
| Management’s Report on Internal Control Over Financial Reporting | F-2 |
| Independent Auditor’s Report | F-2 |
| Balance Sheets | F-3 |
| Statements of Comprehensive Loss | F-4 |
| Statement of Shareholder’s Equity (Deficit) | |
| Statements of Cash Flows | F-5 |
| Notes to the Financial Statements | F-7 to F-10 |
| 11 |
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| MOMENTOUS HOLDINGS CORP. | ||
| (Name of Registrant as Specified in Charter) | ||
| By: | /s/ James Horan | |
| Name: James Horan Title: Chief Executive Officer | ||
Date: July 26, 2017
| 12 |
| 13 |
MOMENTOUS HOLDINGS CORP.
| F-1 |
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholders of
Momentous Holding Corp.
We have audited the accompanying consolidated balance sheets of Momentous Holdings Corp.(the Company) as of May 31, 2017 and 2016 and the related consolidated statements of comprehensive loss, stockholders’ equity (deficit) and cash flows for the years ended May 31, 2017 and 2016. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Momentous Holdings Corp. as of May 31, 2017 and 2016, and the results of its operations and cash flows for the year ended May 31, 2017 and 2016 in conformity with accounting principles generally accepted in the United States of America.
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. As disclosed in Note 2 to the financial statement the Company has generated minimal revenues since inception, has an accumulated deficit of $76,681 and has incurred losses since inception. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.
/S/ Paritz & Company, P.A.
Hackensack, New Jersey
July 25, 2017
| F-2 |
Momentous Holdings Corp.
| May 31, | May 31, | |||||||
| 2017 | 2016 | |||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash | 3,967 | $ | 37,154 | |||||
| Prepaid expenses | – | 561 | ||||||
| Accounts receivable | 40 | 67 | ||||||
| Total Current Assets | 4,007 | 37,782 | ||||||
| Property & Equipment, net of accumulated depreciation of $948 and $758, respectively. | 188 | 537 | ||||||
| TOTAL ASSETS | 4,195 | $ | 38,319 | |||||
| LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | ||||||||
| Liabilities | ||||||||
| Current Liabilities | ||||||||
| Accounts payable | 9,757 | $ | 5,401 | |||||
| Advances from related party | 9,930 | 11,318 | ||||||
| Total Current Liabilities and Total Liabilities | 19,687 | 16,719 | ||||||
| Stockholders' Equity (Deficit) | ||||||||
| Preferred stock, $0.001 par value, 10,000,000 shares authorized; 0 shares issued and outstanding as of May 31, 2017 and May 31, 2016, respectively. | – | – | ||||||
| Common stock, $0.001 par value, 75,000,000 shares authorized; 3,785,000 shares issued and outstanding as of May 31, 2017 and May 31, 2016. | 3,785 | 3,785 | ||||||
| Additional paid-in capital | 57,615 | 57,615 | ||||||
| Accumulated deficit | (76,681 | ) | (42,336 | ) | ||||
| Accumulated other comprehensive income | (211 | ) | 2,536 | |||||
| Total Stockholders' Equity (Deficit) | (15,492 | ) | 21,600 | |||||
| TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) | 4,195 | $ | 38,319 | |||||
The accompanying notes are an integral part of these financial statements.
| F-3 |
Momentous Holdings Corp.
Statements of Comprehensive Loss
| Year Ended | Year Ended | |||||||
| May 31, | May 31, | |||||||
| 2017 | 2016 | |||||||
| Revenues | $ | 176 | $ | 694 | ||||
| Operating Expenses | ||||||||
| General and administrative expenses | 34,521 | 24,739 | ||||||
| Total Operating Expenses | 34,521 | 24,739 | ||||||
| Loss before Provision for Income Taxes | (34,345 | ) | (24,045 | ) | ||||
| Provision for Income (Credits) Taxes | – | – | ||||||
| Net Loss | $ | (34,345 | ) | $ | (24,045 | ) | ||
| Other Comprehensive (Loss) Income | ||||||||
| Foreign currency translation adjustment | (2,747 | ) | 1,677 | |||||
| Total Comprehensive (Loss) Income | (37,092 | ) | (22,368 | ) | ||||
| Net Loss per Share: Basic and Diluted | $ | (0.01 | ) | $ | (0.01 | ) | ||
| Weighted Average Number of Shares Outstanding: Basic and Diluted | 3,785,000 | 2,506,758 | ||||||
The accompanying notes are an integral part of these financial statements.
| F-4 |
Momentous Holdings Corp.
Statement of Stockholders' Equity (Deficit)
| Preferred Stock | Common Stock | Additional Paid-in | Stock Subscription | Accumulated | Accumulated Other Comprehensive Income | Total Stakeholders' Equity | |||||||||||||||||||||
| Shares | Amount | Shares | Amount | Capital | Receivable | Deficit | (Loss) | (Deficit) | |||||||||||||||||||
| Balance, May 31, 2015 | – | – | 2,500,000 | 2,500 | 7,500 | (10,000 | ) | (18,291 | ) | 859 | (17,432 | ) | |||||||||||||||
| Net loss | – | – | – | – | – | (24,045 | ) | – | (24,045 | ) | |||||||||||||||||
| Stock subscription received | – | – | – | – | – | 10,000 | – | – | 10,000 | ||||||||||||||||||
| Issuance of common stock | – | – | 1,285,000 | 1,285 | 50,115 | – | – | 51,400 | |||||||||||||||||||
| Foreign currency translation adjustment | – | – | – | – | – | – | – | 1,677 | 1,677 | ||||||||||||||||||
| Balance, May 31, 2016 | – | – | 3,785,000 | 3,785 | 57,615 | – | (42,336 | ) | 2,536 | 21,600 | |||||||||||||||||
| Net loss | – | – | – | – | – | (34,345 | ) | – | (34,345 | ) | |||||||||||||||||
| Foreign currency translation adjustment | – | – | – | – | – | – | – | (2,747 | ) | (2,747 | ) | ||||||||||||||||
| Balance, May 31, 2017 | – | – | 3,785,000 | 3,785 | 57,615 | – | (76,681 | ) | (211 | ) | (15,492 | ) | |||||||||||||||
The accompanying notes are an integral part of these financial statements
| F-5 |
Momentous Holdings Corp.
| Year Ended | Year Ended | |||||||
| May 31, | May 31, | |||||||
| 2017 | 2016 | |||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
| Net loss | $ | (34,345 | ) | $ | (24,045 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities | ||||||||
| Depreciation expense | 283 | 331 | ||||||
| Changes in assets and liabilities: | ||||||||
| Accounts payable | 4,356 | 408 | ||||||
| Accounts receivable | 27 | (67 | ) | |||||
| Prepaid expenses | 560 | (561 | ) | |||||
| Net cash used in operating activities | (29,118 | ) | (23,933 | ) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
| Repayments to related party, net | (1,388 | ) | (2,002 | ) | ||||
| Proceeds from the sale of common stock | – | 61,400 | ||||||
| Net cash provided by (used in) financing activities | (1,388 | ) | 59,398 | |||||
| Effect of exchange rate changes on cash | (2,681 | ) | 1,689 | |||||
| Changes in cash during the year | (33,187 | ) | 37,154 | |||||
| Cash at beginning of year | 37,154 | – | ||||||
| Cash at end of year | $ | 3,967 | $ | 37,154 | ||||
The accompanying notes are an integral part of these financial statements.
| F-6 |
Momentous Holdings Corp.
Notes to the Financial Statements
May 31, 2017
NOTE 1 – ORGANIZATION, DESCRIPTION OF BUSINESS AND PRINCIPLES OF CONSOLIDATION
We were incorporated as Momentous Holdings Corp. (the “Company”) on May 29, 2015 in the State of Nevada for the purpose of designing, acquiring and developing mobile apps and mobile software for download by end consumers.
Prior to forming Momentous Holdings Corp., Mr. Horan, our founder and president, operated the business as a sole proprietor under the dba “Health & Fitness Apps”. He started the business on December 2, 2013, when he purchased a computer, and started working on product designs and the company’s website. The first sales occurred in early 2014, prior to the formation of Momentous Holdings Corp. Subsequently, Mr. Horan contributed the business assets and liabilities of his sole proprietorship into Momentous Holdings Corp., in exchange for 500,000 shares of our common stock.
Our overall aim is to design, acquire and develop mobile applications (‘app/apps’) and mobile software for download by end consumers. Our goal is to have a training, health and fitness, well-being app for everyone.
NOTE 2 - GOING CONCERN
The accompanying 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 generated minimal revenues since inception, has an accumulated deficit of $76,681 and has incurred losses since inception. These factors, among others, raise substantial doubt about the ability of the Company to continue as a going concern for a reasonable period of time. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty.
The continuing operations of the Company are dependent upon its ability to continue to raise adequate financing and to commence profitable operations in the future and repay its liabilities arising from normal business operations as they become due.
We expect to generate revenues in the future through the development of our existing and news apps. In the event the Company experiences liquidity and capital resource constraints because of unanticipated operating losses, we may need to raise additional capital in the form of equity and/or debt financing. The Company is currently seeking additional funding from investors as well as bringing on a new Director who will assist in developing new apps. The Company’s current President/CEO, will endeavour to provide funding if necessary. If such additional capital is not available on terms acceptable to us or at all, then we may need to curtail our operations and/or take additional measures to conserve and manage our liquidity and capital resources, any of which would have a material adverse effect on our financial position, results of operations, and our ability to continue in existence. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.
NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of presentation
The accounting and reporting policies of the Company conform to accounting principles generally accepted in the United States of America (GAAP).
The consolidated financial statements include the financial statements of Momentous Holdings Corp., and James Horan doing business as Health & Fitness Apps which have been accounted for as a combination of entities under common control. All significant inter-company balances and transactions have been eliminated upon consolidation.
The Company is considered to be in the development stage as defined in ASC 915 “Development Stage Entities.” The Company is devoting substantially all of its efforts to the development of its business plans. The Company has elected to adopt early application of Accounting Standards Update No. 2014-10, Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements; and does not present or disclose inception-to-date information and other remaining disclosure requirements of Topic 915.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Significant estimates and assumptions are required in the determination of the fair value of financial instruments and the valuation of long-lived and indefinite-lived assets. Some of these judgments can be subjective and complex, and, consequently, actual results may differ from these estimates.
Cash and Cash Equivalents
The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents.
| F-7 |
Revenue Recognition
The Company follows FASB ASC 605 “Revenue Recognition” and recognizes revenue when it is realized or realizable and earned. The Company considers revenue realized or realizable and earned when all of the following criteria are met:
1. persuasive evidence of an arrangement exists;
2. the product has been shipped or the services have been rendered to the customer;
3. the sales price is fixed or determinable; and,
4. collectability is reasonably assured.
Income Taxes
We use the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is more likely than not some portion or all of the deferred tax assets will not be realized.
ASC Topic 740.10.30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740.10.40 provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. We have no material uncertain tax positions for any of the reporting periods presented.
Fixed assets
Fixed assets are stated at cost less accumulated depreciation. Depreciation is provided for on a straight-line basis over the useful lives of the assets. Expenditures for additions and improvements are capitalized; repairs and maintenance are expensed as incurred.
Software Development cost
The Company accounts for software development costs in accordance with ASC 350-40, whereby all costs incurred during the preliminary stage of a development project should be charged to expense as incurred. Capitalization of costs begins after the preliminary stage has been completed, management commits to funding the project, it is probable that the project will be completed, and the software will be used for its intended function. All post-implementation costs are charged to expense as incurred. Accordingly, direct internal and external costs associated with the development of the features and functionality of the Company’s software, incurred during the application development stage, are capitalized and amortized using the straight-line method of the estimated life of five years.
Net Loss Per Share
Basic net income (loss) per share amounts are computed based on the weighted average number of shares actually outstanding. Diluted net income (loss) per share amounts are computed using the weighted average number of common shares and common equivalent shares outstanding as if shares had been issued on the exercise of any common share rights unless the exercise becomes antidilutive and then only the basic per share amounts are shown in the report.
Foreign Currency Translation
The functional currency of the Company is Great British Pounds (GBP). Assets and liabilities of our operations are translated into United States dollar equivalents using the exchange rates in effect at the balance sheet date. Revenues and expenses are translated using the average exchange rates during each period and equity accounts are translated at historical cost. Adjustments resulting from the process of translating foreign functional currency financial statements into U.S. dollars are included in accumulated other comprehensive income in shareholders’ deficit.
Recent Accounting Pronouncements
From time to time new accounting pronouncements are issued by the Financial Accounting Standards Board or other standard setting bodies that may have an impact on the Company’s accounting and reporting. The Company believes that such recently issued accounting pronouncements and other authoritative guidance for which the effective date is in the future will not have an impact on its accounting or reporting or that such impact will not be material to its financial position, results of operations and cash flows when implemented.
| F-8 |
NOTE 4 - PROPERTY AND EQUIPMENT
Property consists of equipment purchased for the production of revenues. As of:
| May 31, | May 31, | |||||||
| 2017 | 2016 | |||||||
| Equipment | $ | 1,136 | $ | 1,295 | ||||
| Less accumulated depreciation | 948 | 758 | ||||||
| Equipment, net | $ | 188 | $ | 537 | ||||
Assets are depreciated over their useful lives beginning when placed in service. Depreciation expense was $283 and $331 for the year ended May 31, 2017 and the year ended May 31, 2016, respectively.
NOTE 5- INCOME TAXES
The reconciliation of income tax provision (benefit) at the U.S. statutory rate of 34% for the year ended May 31, 2017 and for the year to May 31, 2016 to the Company’s effective tax rate is as follows:
| May 31, 2017 | May 31, 2016 | |||||||
| Income tax benefit at statutory rate | $ | 11,677 | $ | 8,175 | ||||
| Change in valuation allowance | (11,677 | ) | (8,175 | ) | ||||
| Income tax provision | $ | – | $ | – | ||||
The tax effects of temporary differences that give rise to the Company’s net deferred tax assets as of May 31, 2017 and May 31, 2016 are as follows:
| May 31, 2017 | May 31, 2016 | |||||||
| Net Operating Loss | $ | 26,072 | $ | 14,394 | ||||
| Valuation allowance | (26,072 | ) | (14,394 | ) | ||||
| Net deferred tax asset | $ | – | $ | – | ||||
The Company has approximately $76,700 of net operating losses (“NOL”) carried forward to offset taxable income, if any, in future years which expire commencing in fiscal 2035. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. Based on the assessment, management has established a full valuation allowance against all deferred tax asset relating to NOLs for every period because it is more likely than not that all of the deferred tax asset will not be realized.
NOTE 6 - RELATED PARTY TRANSACTIONS
As of May 31, 2017 and May 31, 2016, the balance of the amounts due to the director was $9,930 and $11,318, respectively. The amounts loaned to and from the director are unsecured, non-interest bearing, and due on demand. The Company’s officer has provided office services without charge. Such costs are immaterial to the financial statements and accordingly are not reflected herein.
NOTE 7 – CAPITAL STOCK
The Company was incorporated on May 29, 2015 in Nevada with authorized capital of 75,000,000 shares of $0.001 par value common stock and 10,000,000 shares of $0.001 par value preferred stock.
On May 29, 2015, the Company’s founder, President and CEO, James Horan, subscribed for 1,000,000 common shares, at a price of $0.005 per share.
| F-9 |
On May 29, 2015, the Company’s former Secretary and Treasurer, Andrew Brown, subscribed for 1,000,000 common shares, at a price of $0.005 per share.
On May 29, 2015, the Company’s founder, President and CEO, James Horan, contributed the business assets and liabilities of his sole proprietorship into Momentous Holdings Corp., in exchange for 500,000 shares of our common stock.
On September 28, 2015, the Company received the $10,000 in respect of James Horan’s subscription of 1,000,000 common shares, at a price of $0.005 per share and Andrew Brown’s subscription of 1,000,000 common shares, at a price of $0.005 per share.
As of February 29, 2016, the Company sold an aggregate of 1,285,000 shares of its common stock in its registered offering at a price of $0.04 per share resulting in proceeds to the Company of $51,400.
There were 3,785,000 shares of common stock issued and outstanding at May 31, 2017. There were no shares of preferred stock issued and outstanding at May 31, 2017.
NOTE 8 – CONCENTRATION
100% of the Company’s revenue is from one client.
| F-10 |