EQUITY RECAPITALIZATION | 6 Months Ended |
Sep. 30, 2014 |
Notes to Financial Statements | ' |
NOTE 4 - EQUITY RECAPITALIZATION | ' |
Stock Purchase |
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On July 23, 2014, pursuant to a stock purchase agreement with Language Arts, Mr. Everett Dickson and FLASR, Mr. Dickson consummated the purchase of 6,000,000 (pre-split, as described below) shares of common stock, par value $0.001 per share, of the Language Arts from Maria del Pilar Jaen which represented 63.15% of the issued and outstanding shares of Language Arts on a fully diluted basis. The purchase price for the shares of $30,000 is payable by Mr. Dickson to Ms. Jaen on January 23, 2015. |
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Effective July 23, 2014, in connection with the closing of the stock purchase agreement, Ms. Jaen resigned as the sole officer and director of Language Arts and Mr. Dickson was appointed President, Chief Executive Officer, Chief Financial Officer and sole director of Language Arts. Mr. Dickson took control with the intention of merging FLASR into Language Arts. |
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Stock Split, Equity Transactions, and Reorganization |
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On July 30, 2014, Language Arts’ board of directors approved the implementation of a stock dividend payment, effective on September 22, 2014, in the form of a 1:6 forward stock split whereby each holder of record on August 28, 2014 of the 9,500,000 issued and outstanding shares of common stock automatically received shares at the rate of 1 for 5, without any action on the part of the stockholders. Accordingly, there were an additional 47,500,000 shares of common stock issued and outstanding on the said date. |
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Effective September 22, 2014, Language Arts, having amended and restated its articles of incorporation with the Secretary of State of Nevada; (i) changed its name to FLASR, Inc.; (ii) increased the amount of authorized shares of common stock from 75,000,000 to 150,000,000; and (iii) authorized the issuance of 5,000,000 shares of blank check preferred stock. In addition, Language Arts changed its ticker symbol from “LGUA” to "FLSR". |
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FLASR Acquisition |
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On September 16, 2014, Language Arts acquired all of the outstanding capital stock (the “Shares”) of FLASR pursuant to a stock purchase agreement with FLASR and its sole stockholder Everett Dickson. As a result, FLASR became a wholly owned subsidiary of Language Arts. |
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In exchange for the Shares, Language Arts issued an aggregate of 50,000,000 shares (post-split) of its common stock to Mr. Dickson, resulting in Mr. Dickson owning 80.4% of the 107,000,000 issued and outstanding share capital of Language Arts (after adjusting for the 1:6 forward stock split as described above). |
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Reverse Capitalization |
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The acquisition of FLASR by Language Arts was treated as a reverse capitalization, with FLASR deemed the accounting acquirer and Language Arts deemed the accounting acquiree under the purchase method of accounting. The reverse merger is deemed a recapitalization and the accompanying financial statements represent the continuation of the financial statements of FLASR (the accounting acquirer/legal subsidiary) except for its capital structure, and the accompanying financial statements reflect the assets and liabilities of FLASR recognized and measured at their carrying value before the combination and the assets and liabilities of Language Arts (the legal acquiree/legal parent). The equity structure reflects the equity structure of Language Arts, the legal parent, and the equity structure of FLASR, the accounting acquirer, as restated to reflect the number of shares of the legal parent. The merged entity is referred to herein as “the Company”. |
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The following table reflects the net change in authorized, issued and outstanding shares of common and preferred stock of Language Arts, FLASR and the Company as a result of the reverse capitalization (as described in Note 2): |
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| | Stockholders' Deficit | |
Description | | Authorized | | | Issued and Outstanding | | | Authorized | | | Issued and Outstanding | |
| | Language Arts | | | FLASR | |
| | Common Shares | | | Common Shares | |
Beginning Balances-March 31, 2014 | | | | | | | | | | | 200 | | | | 200 | |
Original Balances-Language Arts | | | 75,000,000 | | | | 9,500,000 | | | | | | | | | |
Increase in authorized shares | | | 75,000,000 | | | | - | | | | - | | | | - | |
Adjust for 1:6 forward stock split | | | - | | | | 47,500,000 | | | | - | | | | - | |
Issuance of shares for FLASR acquisition | | | - | | | | 50,000,000 | | | | - | | | | - | |
Elimination at FLASR's acquisition | | | - | | | | - | | | | (200 | ) | | | (200 | ) |
Ending balances-September 30, 2014* | | | 150,000,000 | | | | 107,000,000 | | | | - | | | | - | |
| | | | | | | | | | | | | | | | |
| | | Preferred Shares | | | | | | | | | |
Beginning Balances-March 31, 2014 | | | - | | | | - | | | | | | | | | |
Increase in authorized shares | | | 5,000,000 | | | | - | | | | | | | | | |
Ending balances-September 30, 2014* | | | 5,000,000 | | | | - | | | | | | | | | |
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* The Company's post reverse capitalization share balances. The par value on ending common and preferred shares is $0.001. |