Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Mar. 31, 2015 | Apr. 29, 2015 | |
Document And Entity Information | ||
Entity Registrant Name | HighLight Networks, Inc. | |
Entity Central Index Key | 1445175 | |
Document Type | 10-Q | |
Document Period End Date | 31-Mar-15 | |
Amendment Flag | FALSE | |
Current Fiscal Year End Date | -24 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 3,167,600 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2015 |
Consolidated_Balance_Sheets_Un
Consolidated Balance Sheets (Unaudited) (USD $) | Mar. 31, 2015 | Jun. 30, 2014 |
Current Assets: | ||
Cash | $96 | $6,081 |
Prepaid expenses | 1,427 | 1,427 |
Inventory | 4,864 | 10,948 |
Total Current Assets | 6,387 | 18,456 |
Total Assets | 6,387 | 18,456 |
Current Liabilities: | ||
Accounts payable | 47,063 | 69,939 |
Accrued expenses | 51,314 | 27,176 |
Accounts payable to related parties | 295,441 | 170,165 |
Advances from related party | 100 | 100 |
Notes payable to related parties | 397,807 | 323,027 |
Total Current Liabilities | 791,725 | 590,407 |
Stockholders' Deficit: | ||
Preferred stock, $.001 par value; 20,000,000 shares authorized; no shares outstanding as of March 31, 2015 and June 30, 2014 | ||
Common stock; $.001 par value; 150,000,000 shares authorized; 3,167,600 shares outstanding as of March 31, 2015 and 14,167,600 shares outstanding as of June 30, 2014 | 3,168 | 14,168 |
Additional paid-in capital | 8,036,694 | 8,698,757 |
Accumulated deficit | -8,825,200 | -9,284,876 |
Total Stockholders' Deficit | -785,338 | -571,951 |
Total Liabilities and Stockholders' Deficit | $6,387 | $18,456 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2015 | Jun. 30, 2014 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value per share | $0.00 | $0.00 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value per share | $0.00 | $0.00 |
Common stock, shares authorized | 150,000,000 | 150,000,000 |
Common stock, shares issued | 3,167,600 | 14,167,600 |
Common stock, shares outstanding | 3,167,600 | 14,167,600 |
Consolidated_Statements_Of_Ope
Consolidated Statements Of Operations (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | |
Revenues: | ||||
Income | $7,302 | |||
Cost of goods sold | 6,084 | 2,903 | ||
Gross (loss) profit | -6,084 | 4,399 | ||
Operating Expenses: | ||||
Consulting expense | 56,250 | 6,249,470 | ||
General and administrative | 30,035 | 153,572 | -565,401 | 1,637,822 |
Rent expense | 24,000 | 24,000 | 72,000 | 72,000 |
Total Operating Expenses | 54,035 | 233,822 | -493,401 | 7,959,292 |
Income (Loss) from Operations | -54,035 | -233,822 | 487,317 | -7,954,893 |
Other Income (Expense): | ||||
Interest expense | 9,671 | 5,973 | 27,641 | 69,556 |
Loss on extinguishment of debt | -92,144 | -92,144 | ||
Net (Loss) Income | ($63,706) | ($331,939) | $459,676 | ($8,116,593) |
Net (loss) income per share - basic and diluted | ($0.02) | ($0.02) | $0.05 | ($0.94) |
Weighted average shares outstanding - basic and diluted | 3,167,600 | 14,047,600 | 8,645,702 | 8,620,009 |
Consolidated_Statement_Of_Stoc
Consolidated Statement Of Stockholders' Deficit (Unaudited) (USD $) | Common Stock | Additional Paid-in Capital | Accumulated Deficit | Total |
Balance, value at Jun. 30, 2014 | $14,168 | $8,698,757 | ($9,284,876) | ($571,951) |
Balance, shares at Jun. 30, 2014 | 14,167,600 | 14,167,600 | ||
Cancelation of unvested stock compensation | -673,063 | -673,063 | ||
Cancelation of common stock issued, shares | -11,000,000 | |||
Cancelation of common stock issued, value | -11,000 | 11,000 | ||
Net income | 459,676 | 459,676 | ||
Balance, value at Mar. 31, 2015 | $3,168 | $8,036,694 | ($8,825,200) | ($785,338) |
Balance, shares at Mar. 31, 2015 | 3,167,600 | 3,167,600 |
Consolidated_Statements_Of_Cas
Consolidated Statements Of Cash Flows (Unaudited) (USD $) | 9 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Cash flows from operating activities | ||
Net income (loss) | $459,676 | ($8,116,593) |
Adjustments to reconcile net loss to net cash used in operating expenses: | ||
Amorization of debt discounts | 53,846 | |
Stock-based compensation | -673,063 | 7,654,102 |
Loss on inventory impairment | 6,084 | 92,144 |
Changes in operating assets and liabilities: | ||
Accounts receivable | -1,182 | |
Inventory | -2,121 | |
Accounts payable and accrued expenses | -26,376 | 37,442 |
Accounts payable to related parties | 152,914 | 110,763 |
Net cash used in operating activities | -80,765 | -164,993 |
Cash flows from financing activities | ||
Proceeds from notes payable to related parties | 74,780 | 161,025 |
Payments on related party debt borrowings | 40,498 | |
Net cash provided by financing activities | 74,780 | 120,527 |
Net (decrease) increase in cash | -5,985 | -44,466 |
Cash at beginning of period | 6,081 | 50,010 |
Cash at end of period | 96 | 5,544 |
Supplemental disclosures of cash flow information: | ||
Cash paid during the year for: Interest | ||
Cash paid during the year for: Income taxes | ||
Non-cash investing and financing activties: | ||
Debt discount due to beneficial conversion feature | 145,990 | |
Cancelation of common stock issued | $11,000 |
Organization_And_Basis_Of_Pres
Organization And Basis Of Presentation | 9 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Accounting Policies [Abstract] | |||||||||
Organization and Basis of Presentation | Note 1 — Organization and Basis of Presentation | ||||||||
Organization and Basis of Presentation | |||||||||
The accompanying consolidated financial statements are unaudited. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations and cash flows for all periods presented have been made. | |||||||||
Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these condensed financial statements be read in conjunction with the financial statements and notes thereto included in the Company's June 30, 2014 audited financial statements as reported in Form 10K. The results of operations for the nine month period ended March 31, 2015 are not necessarily indicative of the operating results for the full year ended June 30, 2015. | |||||||||
The Company was formed on June 21, 2007 as a Nevada corporation. In 2013 the Company has commenced operations and is no longer considered a development stage company. The Company has a June 30 year end. | |||||||||
On March 11, 2013, EZ Recycling, Inc was formed and incorporated to serve as a wholly owned subsidiary of Highlight Networks, Inc. EZ Recycling is incorporated in the State of Nevada. All inter-company balances and transactions are eliminated in consolidation. | |||||||||
Nature of Business | |||||||||
In 2013 the Company announced a new business venture in recycling, refining, metals trading and assisting in metal recovery, with a focus on precious metals refining from electronic waste. During 2013, the Company began its new business venture in recycling, refining, metals trading and assisting in metal recovery, with a focus on precious metals refining from electronic waste. | |||||||||
The Company’s principal executive offices are located at 7325 Oswego Road Liverpool, NY 13090. As of February 19, 2013 the Company also has a rental agreement for a warehouse property located at 6 Alder East Syracuse, NY 13057. Our telephone number is (315) 451-4889. | |||||||||
Inventory | |||||||||
For the nine months ended March 31, 2015, the company had ending inventory of 6,475 lbs. of scrap metal and used circuit boards and recognized $0 in revenue from the processing, recycling, refining or sale of inventory. Inventories are periodically monitored to ensure that the reserve for obsolescence covers any obsolete items. As of March 31, 2015, there was no reserve for obsolescence. Inventories are valued at the lower of cost (using average cost) or market. | |||||||||
During the nine months ended March 31, 2015, management determined that the remaining EBAY inventory was impaired and an impairment loss of $6,084 was recognized. The impairment loss is classified as cost of goods sold in the consolidated statements of operations. As of March 31, 2015, there was no remaining EBAY inventory. | |||||||||
Inventory consisted of the following finished goods as of March 31, 2015 and June 30, 2014: | |||||||||
March 31, | June 30, | ||||||||
2015 | 2014 | ||||||||
EBAY merchandise | $ | — | $ | 6,084 | |||||
Scrap metal | 4,864 | 4,864 | |||||||
Total inventory | $ | 4,864 | $ | 10,948 |
Going_Concern
Going Concern | 9 Months Ended |
Mar. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Going Concern | Note 2 — Going Concern |
The accompanying financial statements have been prepared on the basis of accounting principles applicable to a “going concern,” which assume that Highlight Networks, Inc. (hereto referred to as the “Company”) will continue in operation for at least one year and will be able to realize its assets and discharge its liabilities in the normal course of operations. | |
Several conditions and events raise substantial doubt as to the Company’s ability to continue as a “going concern.” The Company has incurred net losses of approximately $8,825,200 for the period from June 21, 2007 (inception) to March 31, 2015, has a working capital deficit and an accumulated deficit, has recurring losses, has limited revenues, and requires additional financing in order to finance its business activities on an ongoing basis. The Company’s future capital requirements will depend on numerous factors including, but not limited to, continued progress in the pursuit of business opportunities. The Company is actively pursuing alternative financing and has had discussions with various third parties, although no firm commitments have been obtained. In the interim, shareholders of the Company have committed to meeting its minimal operating expenses. Management believes that actions presently being taken to revise the Company’s operating and financial requirements provide them with the opportunity to continue as a “going concern.” | |
These financial statements do not reflect adjustments that would be necessary if the Company were unable to continue as a “going concern.” While management believes that the actions already taken or planned, will mitigate the adverse conditions and events which raise doubt about the validity of the “going concern” assumption used in preparing these financial statements, there can be no assurance that these actions will be successful. If the Company were unable to continue as a “going concern,” then substantial adjustments would be necessary to the carrying values of assets, the reported amounts of its liabilities, the reported revenues and expenses, and the balance sheet classifications used. |
Commitments
Commitments | 9 Months Ended |
Mar. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | Note 3 — Commitments |
On January 1, 2013, the Company entered into a 3 year consulting agreement. Pursuant to the terms of the agreement, the Company issued 175,000 common shares to the consultant upon execution of the agreement and the Company committed to paying a cash commission equal to 8% of the gross sales of all merchandise and scrap products shipped and sold under any contract arranged by the consultant over the term of the agreement. | |
On February 19, 2013, the Company entered into a lease agreement with a related party (see Note 4) beginning March 1, 2013 to rent the property at 6 Alder Drive East Syracuse, New York 13057. The monthly rent under the agreement is $8,000, along with property taxes, utilities and waste management incurred by the Company in the use of the facility. The initial term of the lease agreement is 5 years. As of March 31, 2015, the Company owes $200,000 in unpaid rent and $69,270 in property tax reimbursement to Remix Ventures LLC, under this lease. |
Related_Party_Transactions
Related Party Transactions | 9 Months Ended |
Mar. 31, 2015 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 4 — Related Party Transactions |
From 2013-2015, the Company incurred loans due to related parties, Friction & Heat LLC and Joseph C. Passalaqua. Joseph C. Passalaqua is the sole managing member of Friction & Heat LLC and an officer of Highlight Networks, Inc. The outstanding related party debt is held in unsecured promissory notes, bears interest at 10% per annum and matures between on demand and March 31, 2016. In the nine months ended March 31, 2015, $74,780 was borrowed. As of March 31, 2015 and June 30, 2014, the Company has a total outstanding debt of $397,807 and $323,027, respectively, with accrued interest of $49,814 and $22,176, respectively, owed to related parties Friction & Heat LLC and Joseph C. Passalaqua. | |
From 2013-2015, the Company incurred liabilities for unpaid rent at $8,000 monthly to Remix Ventures, LLC, according to a signed rental agreement. Joseph C. Passalaqua the sole managing member of Remix Ventures, LLC and an officer of Highlight Networks, Inc. As of March 31, 2015 and June 30, 2014, the amount due for rent was $200,000 and $128,000, respectively. | |
From 2013 -2015, the Company incurred liabilities for the reimbursement of property taxes that were paid by Remix Ventures, LLC, according to a signed rental agreement. Joseph C. Passalaqua is the sole managing member of Remix Ventures, LLC and an officer of Highlight Networks, Inc. As of March 31, 2015 and June 30, 2014, the amount due in property tax reimbursement to Remix Ventures LLC was $69,270 and $42,165, respectively. | |
In 2015, the Company incurred liabilities for bookkeeping, internal accounting, office assistant services and secretarial services that were rendered by Lyboldt-Daly, Inc. As of January 1, 2015, Highlight Networks ceased all payroll activities and does not have employees, therefore reimbursement is owed to Lyboldt-Daly, Inc for use of their employees in rendering these outside services. Joseph C. Passalaqua is the President of Lyboldt-Daly, Inc. and an officer of Highlight Networks, Inc. As of March 31, 2015, the amount due for outside services to Lyboldt-Daly, Inc. was $26,171. | |
In 2013, EZ Recycling, Inc., the wholly owned subsidiary of Highlight Networks, Inc. borrowed $100 from a related party, Joseph C. Passalaqua. The amount is non-interest bearing advance. As of March 31, 2015 and June 30, 2014, the unpaid amount on the advance was $100. |
Equity
Equity | 9 Months Ended |
Mar. 31, 2015 | |
Equity [Abstract] | |
Equity | Note 5 — Equity |
The Company is authorized to issue 150,000,000 shares of common stock, with par value of $0.001 per share. | |
On November 1, 2013, the Company committed to issue 4,000,000 common shares in an agreement to a structuring agent. Of these shares, 1,000,000 were issued and fully earned upon execution of the agreement as compensation and the remaining 3,000,000 are due when certain performance objectives are met. The Company recognized the full fair value of the 1,000,000 shares issued and earned of $627,000 during the year ended June 30, 2014. The fair value of the remaining 3,000,000 shares was determined to be $930,000 was being recognized over the expected successful completion date of the performance conditions of September 30, 2014. During the year ended June 30, 2014, $673,063 was recognized as expense for the 3,000,000 shares. | |
On October 14, 2014, the parties mutually agreed to cancel the agreement, dated November 1, 2013 and the commitment to issue the 3,000,000 unearned shares, along with the 1,000,000 shares previously issued, were cancelled. The 1,000,000 shares of common stock that had vested were returned to the Company and cancelled. The previously recognized stock compensation on the unvested shares of $673,063 was reversed during the nine months ended March 31, 2015. | |
On November 17, 2014, 10,000,000 shares of common stock previously issued to an officer and Director were returned to the Company and cancelled. | |
There were no new shares issued during the nine months ended March 31, 2015. As of March 31, 2015, there were 3,167,600 shares of common stock issued and outstanding. |
Subsequent_Events
Subsequent Events | 9 Months Ended |
Mar. 31, 2015 | |
Subsequent Events | |
Subsequent Events | Note 6 — Subsequent Events |
On April 1, 2015, the Company incurred an additional $8,000 due to Remix Ventures for rent. | |
On April 8, 2015, the company collected $400 in revenue, from the collection and recycling of metal. | |
In April 2015, an additional $1,550 was loaned to Highlight Networks, Inc. and $445 was loaned to EZ Recycling Inc., the Company’s Subsidiary, from a related party. The principal amount of $1,995 is held in promissory notes that are unsecured, bear simple interest at 10% per annum and are payable upon demand. |
Organization_And_Basis_Of_Pres1
Organization And Basis Of Presentation (Tables) | 9 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||
Schedule of Inventory | Inventory consisted of the following finished goods as of March 31, 2015 and June 30, 2014: | ||||||||
March 31, | June 30, | ||||||||
2015 | 2014 | ||||||||
EBAY merchandise | $ | — | $ | 6,084 | |||||
Scrap metal | 4,864 | 4,864 | |||||||
Total inventory | $ | 4,864 | $ | 10,948 |
Organization_And_Basis_Of_Pres2
Organization And Basis Of Presentation (Details) (USD $) | Mar. 31, 2015 | Jun. 30, 2014 |
Note 1 - Organization And Basis Of Presentation Details | ||
EBAY merchandise | $6,084 | |
Scrap metal | 4,864 | 4,864 |
Total inventory | $4,864 | $10,948 |
Going_Concern_Narrative_Detail
Going Concern (Narrative) (Details) (USD $) | 3 Months Ended | 9 Months Ended | 93 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | |
Going Concern Narrative Details | |||||
Net losses | ($63,706) | ($331,939) | $459,676 | ($8,116,593) | $8,825,200 |
Commitments_Narrative_Details
Commitments (Narrative) (Details) (USD $) | 0 Months Ended | |||
Jan. 01, 2013 | Feb. 19, 2013 | Mar. 31, 2015 | Jun. 30, 2014 | |
Other Commitments [Line Items] | ||||
Property tax reimbursement | $295,441 | $170,165 | ||
Consulting Agreement | ||||
Other Commitments [Line Items] | ||||
Consulting agreement period | 3 years | |||
Consulting agreement commitment term | The Company committed to paying a cash commission equal to 8% of the gross sales of all merchandise and scrap products shipped and sold under any contract arranged by the consultant over the term of the agreement. | |||
Consulting Agreement | Common Stock | ||||
Other Commitments [Line Items] | ||||
Shares issued during the period for service, shares | 175,000 | |||
Lease Agreement | Remix Ventures, LLC Managed By Joseph C. Passalaqua | ||||
Other Commitments [Line Items] | ||||
Monthly rent | 8,000 | |||
Lease agreement period | 5 years | |||
Accrued rent | 200,000 | 128,000 | ||
Property tax reimbursement | $69,270 | $42,165 |
Related_Party_Transactions_Nar
Related Party Transactions (Narrative) (Details) (USD $) | 9 Months Ended | 12 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2014 | Jun. 30, 2013 | Jun. 30, 2014 | |
Related Party Transaction [Line Items] | ||||
Proceeds from related party debt | $74,780 | $161,025 | ||
Outstanding debt | 397,807 | 323,027 | ||
Accrued interest | 51,314 | 27,176 | ||
Accounts payable to related parties | 295,441 | 170,165 | ||
Due to related party | 100 | 100 | ||
Joseph C. Passalaqua And Friction & Heat Managed By Joseph C. Passalaqua | Unsecured Promissory Notes | ||||
Related Party Transaction [Line Items] | ||||
Debt instrument interest rate | 10.00% | |||
Debt instrument maturity date description | Matures between on demand and March 31, 2016. | |||
Proceeds from related party debt | 74,780 | |||
Outstanding debt | 397,807 | 323,027 | ||
Accrued interest | 49,814 | 22,176 | ||
Remix Ventures, LLC Managed By Joseph C. Passalaqua | Lease Agreement | ||||
Related Party Transaction [Line Items] | ||||
Accrued monthly rent | 8,000 | |||
Accrued rent | 200,000 | 128,000 | ||
Accounts payable to related parties | 69,270 | 42,165 | ||
Lyboldt-Daly, Inc - Joseph C. Passalaqua Is The President | ||||
Related Party Transaction [Line Items] | ||||
Accounts payable to related parties | 26,171 | |||
Joseph C. Passalaqua | EZ Recycling, Inc. | ||||
Related Party Transaction [Line Items] | ||||
Proceeds from related party debt | 100 | |||
Due to related party | $100 | $100 |
Equity_Narrative_Details
Equity (Narrative) (Details) (USD $) | 9 Months Ended | 0 Months Ended | 12 Months Ended | ||||
Mar. 31, 2015 | Mar. 31, 2014 | Nov. 17, 2014 | Oct. 14, 2014 | Sep. 30, 2014 | Nov. 01, 2013 | Jun. 30, 2014 | |
Stock-based compensation | ($673,063) | $7,654,102 | |||||
Cancellation of common stock issued | |||||||
Common Stock | |||||||
Cancellation of common stock issued | -11,000 | ||||||
Common Stock | Officer And Director | |||||||
Cancellation of common stock issued | 10,000,000 | ||||||
Agreement With Structuring Agent | |||||||
Stock-based compensation | -673,063 | ||||||
Agreement With Structuring Agent | Common Stock | |||||||
Share commitment description | On November 1, 2013, the Company committed to issue 4,000,000 common shares in an agreement to a structuring agent. Of these shares, 1,000,000 were issued and fully earned upon execution of the agreement as compensation and the remaining 3,000,000 are due when certain performance objectives are met. | ||||||
Shares commitment | -3,000,000 | 3,000,000 | |||||
Shares issued during the period for service, shares | -1,000,000 | 1,000,000 | |||||
Shares issued during the period for service, value | 627,000 | ||||||
Fair value of shares commitment, shares | 3,000,000 | ||||||
Fair value of shares commitment, value | 930,000 | ||||||
Stock-based compensation | $673,063 |
Subsequent_Events_Narrative_De
Subsequent Events (Narrative) (Details) (USD $) | 3 Months Ended | 9 Months Ended | 0 Months Ended | 1 Months Ended | |||
Mar. 31, 2015 | Mar. 31, 2014 | Mar. 31, 2015 | Mar. 31, 2014 | Apr. 08, 2015 | Apr. 28, 2015 | Apr. 01, 2015 | |
Subsequent Event [Line Items] | |||||||
Revenue from collection and recycling of metal | $7,302 | ||||||
Proceeds from related party debt | 74,780 | 161,025 | |||||
Subsequent Event | |||||||
Subsequent Event [Line Items] | |||||||
Revenue from collection and recycling of metal | 400 | ||||||
Subsequent Event | Remix Ventures, LLC Managed By Joseph C. Passalaqua | |||||||
Subsequent Event [Line Items] | |||||||
Accrued rent | 8,000 | ||||||
Subsequent Event | Related Party | Unsecured Promissory Notes | |||||||
Subsequent Event [Line Items] | |||||||
Proceeds from related party debt | 1,550 | ||||||
Promissory note, principal amount | 1,995 | ||||||
Debt instrument interest rate | 10.00% | ||||||
Debt instrument description | Payable upon demand. | ||||||
Subsequent Event | Related Party | Unsecured Promissory Notes | EZ Recycling, Inc. | |||||||
Subsequent Event [Line Items] | |||||||
Proceeds from related party debt | $445 | ||||||
Debt instrument interest rate | 10.00% | ||||||
Debt instrument description | Payable upon demand. |