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UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 10-KSB

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(MARK ONE)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2006

OR

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ___________ TO _____________

Commission file number 005-78178

hereUare, Inc.(Name of small business issuer in its charter)



|Delaware                                                       | 02-0575232                             
|-------------------------------------------------------------- | ---------------------------------------
|(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification Number)

5201 Great America Parkway, Suite 446Santa Clara, California 95054(Address of Principal Executive Offices including Zip Code)

(408) 988-1888(Registrant's Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:Common Stock, $0.0001 par value

(Title of Class)

Check whether the issuer is not required to file reports pursuant to Section 13 or 15(d) of the Exchange
Act.     [  ]

Check whether the issuer (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.     [X] Yes     [  ] No

Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation
S-B contained in this form and no disclosure will 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-KSB, or any amendment to this Form
10-KSB.     [X]

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

Issuer's revenues for its most recent fiscal year: $

Aggregate market value of common stock held by
non-affiliates at March 31, 2007:  $98,344,914 (see Note A)

Number of shares of common stock outstanding
at March 31, 2007: 33,855,689

DOCUMENTS INCORPORATED BY REFERENCE:  
Portion of the Registrant's Definitive Proxy Statement or Information Statement
to be filed prior to April 30, 2007, are incorporated by reference into Part III
to the extent stated in Part III, and into Item 14 to the extent stated in Item
14.

Transitional Small Business Disclosure Format (check one):     [   ]
Yes     [X] No

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Note A:
Based upon the $6.00 price in the most recent transaction involving the sale of the
Company's common stock as there is no active trading market.

Total Number of Pages: 42
Exhibit Index is on Page: 38

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HEREUARE,  INC.2006 ANNUAL REPORT ON FORM 10-KSBINDEX



|Part I.        |                                                                                                                                             | Page
|-------------- | ------------------------------------------------------------------------------------------------------------------------------------------- | ----
|Item 1.        | Descriptions of Business                                                                                                                    | 4   
|Item 2.        | Descriptions of Property                                                                                                                    | 7   
|Item 3.        | Legal Proceedings                                                                                                                           | 8   
|Item 4.        | Submission of Matters to a Vote of Security Holders                                                                                         | 8   
|Part II.       |                                                                                                                                             |     
|Item 5.        | Market for the Registrant's Common Equity and Related Stockholder
      Matters                                                             | 8   
|Item 6.        | Management's Discussion and Analysis of Financial Condition and Results
      of Operations                                                 | 9   
|Item 7.        | Financial Statements                                                                                                                        | 13  
|Item 8.        | Changes in and Disagreements with Accountants on Accounting and
      Financial Disclosures                                                 | 13  
|Item 8A.       | Control and Procedures                                                                                                                      | 13  
|Item 8B.       | Other Information                                                                                                                           | 15  
|Part III.      |                                                                                                                                             |     
|Item 9.        | Directors, Executive Officers, Promoters, Control Persons and Corporate
      Governance; Compliance with Section 16(a) of the Exchange Act | 15  
|Item 10.       | Executive Compensation                                                                                                                      | 15  
|Item 11.       | Security Ownership of Certain Beneficial Owners and Management and
      Related Stockholder Matters                                        | 15  
|Item 12.       | Certain Relationships and Related Transactions and Director
      Independence                                                              | 16  
|Part IV.       |                                                                                                                                             |     
|Item 13.       | Exhibits                                                                                                                                    | 16  
|Item 14.       | Principal Accountant Fees and Services                                                                                                      | 16  
|Signatures     |                                                                                                                                             | 16  
|Exhibits Index |                                                                                                                                             | 38  
|Certifications |                                                                                                                                             | 39  



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PART I

Our disclosure and analysis in this report contains forward-looking statements. When used in this discussion, the words
"believes," "anticipates" and "intends" and similar expressions are intended to identify forward-looking statements, but the
absence of these words does not necessarily mean that a statement is not forward looking. Forward-looking statements include,
but are not limited to, statements about our expansion plans, objectives, expectations, intentions, and target markets, and
are subject to risks and uncertainties that could cause actual results to differ materially from those anticipated in these
forward-looking statements for many reasons, including the factors described under
"Risk Factors Affecting Future Performance," "Description of Business" and elsewhere in this report. We undertake no obligation to publicly release any revisions to these
forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence
of anticipated events. Readers are urged, however, to review the factors and risks we describe in reports we file from time to
time with the Securities and Exchange Commission, which may be accessed at the Commission's website at
www.sec.gov.

Item 1. Description of Business

General

hereUare, Inc. ("hereUare", "HUA", or "the Company"), formerly known as
PeopleNet International Corporation, is a Delaware
corporation headquartered in Santa Clara, California. hereUare was incorporated on February 5, 1997
under the original name of American Champion Media, Inc.
hereUare was formed by, and had
been a wholly owned subsidiary of Pacific Systems Control Technology, Inc., formerly known as American Champion Entertainment,
Inc., a Delaware corporation. The board of directors of Pacific Systems determined that it was in the stockholders' best
interest to separate the two companies and allow them to operate independently. Through a spin-off transaction on February 8,
2002, hereUare became an independent entity and Pacific Systems distributed its shares of
hereUare to the stockholders of
Pacific Systems as of the record date of January 16, 2002. The securities of
hereUare are not currently traded on any market.

On September 22, 2006, the Company acquired hereUare
Communications, Inc., a Delaware corporation, by reverse merger. Details of the acquisition are
available on the Company's Current Report on Form 8-K dated September 22, 2006,
as filed with the SEC on September 28, 2996, as amended by Form 8-K/A filed on
December 8, 2006. On March 26, 2007, hereUare changed its name from PeopleNet
International Corporation to hereUare, Inc.

Discontinued Business

Between the years 1997 and 2000, the Company developed and produced a series
of television shows for children which aired on public TV stations across the country. We determined that future revenues would not be generated from this TV series
and the investment in the production of the shows was fully reserved as of December 31, 2003.

In 2001 and 2002, we licensed and then purchased a safe web browser software for children. We evaluated this asset at
December 31, 2003 and determined that this asset had been impaired and was of no value, based upon the fair market value
of similar assets.  We recorded an impairment expense equal to the remaining book value of this asset.

In 2002 we purchased all rights relating to the intellectual property of a business communication software package. We
evaluated this asset  at December 31, 2003 and determined that this asset has been impaired and was of no value, based upon
the fair market value of similar assets. We recorded an impairment expense equal to the remaining book value of this asset.

Company Products

The Company and its wholly own operating subsidiary
hereUare Communications, Inc., provide individuals and small to medium
enterprises with a personalized and centralized Internet platform that
aggregates user needs on any Internet device. The Company's
products focus on delivering simple, flexible and patent pending technologies
uniquely tailored to different Internet needs or styles.

Our Internet product suite and tools which we are testing on an internal
basis include:

Search - an intelligent search tool with patent
pending technology that efficiently delivers relevant information on the Internet in a simple and
precise presentation designed for all types of users from novice to expert. The
engine indexes over 10 billion pages providing a powerful reach of information in today's
marketplace.

VoIP - peer-to-peer voice connection through the Internet
with patent pending click-to-call technology and follow-me everywhere custom
calling feature allowing maximum privacy of the called party.



Classifieds - a centralized marketplace for merchandise,
jobs, real estate, automotive, etc. in local communities around the world.

Messaging (HUA Groupware) - a centralized HUA web-based
office tool, that allows for group collaboration, individual emails, group
emails, and shared calendars and files across groups.

Community - allows users to create post and browse topics
of interest in their communities locally and around the world, such as blogs, groups and forums.

Each application is interconnected through sharing and interchangeable
functionalities.  For example, once fully functional, a user would be able
to click the phone number to order a
pizza through the hereUare VoIP tool from the search result page or from a
user's contact list.  This level of simplicity is designed to increase user
efficiency while greatly enhancing the user experience, which directly
correlates to the success of businesses that rely on the Internet as their point of sale.

The Market

The Internet market became a reality for North American households in 1993 and 1994,
when Mosaic and Netscape browsers introduced the home based PC market to the
online world, thus allowing computer users a convenient and exciting way to
browse the Internet. By 2005, nearly 210 million U.S. Internet users were on line,
placing the U.S. as the country with the highest penetration rate in the world
as it applies to the number of Internet users per 1,000 people. According to eTForecasts, due to high adoption rates
early in its introduction, the U.S. rate of Internet use is now in a stage typical of a mature level of growth
for a technology, while worldwide growth rates continue to surge at impressive rates, thus presenting
new Internet business opportunities worldwide. The study concludes that the Asia Pacific region is expected to
significantly lead worldwide Internet expansion and will reach nearly 600
million Asia Pacific Internet users in 2007.

With rapidly expanding web content, the Internet has emerged as the first truly
global market place that provides a multitude of goods and services, offered and
purchased by
a multitude of international participants. The growth of online commerce has
driven further Internet usage, and will be the impetus for change in the future.
 The continued proliferation of web sites, content and specialized businesses in
the Internet marketplace, will drive the growth from new Internet users. This
rapid growth of the Internet necessitates advanced Internet tools, technologies
and services, even though the primary business model has not changed during the
last ten years. Revenues continue to be derived from general advertising based
campaigns and targeted ads based on user search criteria.

Although search plays a vital role in the success of an Internet portal by
pushing traffic or "eye-balls", many analysts argue today that this is only a
small component in attracting traffic.  As the individual Internet user becomes
more sophisticated, user expectations will fundamentally shift to emerging
applications beyond search, to personal activities such as the use of calendars,
contact files, click to connect, and other advanced services.  According to
Forbes Technology (5/2006), as competition for users increases, success will
depend on the ability to retain user loyalty to a particular website or a suite
of products that enhance the overall user experience, as well as increasing
efficiencies for the user.

Marketing Strategy

Our sales and marketing strategy is to build a viral
(self-propelled replication) marketing message by establishing an Internet dialogue among communities for our
brand name and products. It is hoped that these dialogues will lead to hereUare
achieving a "cool factor" fueling an infectious need among early adapters to try
hereUare, which will ultimately lead to acceptance by the general population of
Internet users. The heart of
the plan comprises strategies to create and foster the viral marketing effect
through  'brand' building techniques, which the Company hopes will drive
traffic to the hereUare websites

Search and VoIP are two of the most highly prized tools used
on the Internet today. Total
search revenue has been projected by Jupitermedia to reach $20 billion by 2010,
while VoIP revenue has been predicted by ZDNet Research to grow at an average annual rate of
31% over the next 5 years. The revenue growth potential of these two applications alone is the basis of our initial
market entry efforts. Our focus is to drive adoption rate for our VoIP solution which will increase our Search
traffic and vice versa. These applications are the backbone of our online product revenue growth.

Our VoIP offers two identified revenue paths, retail voice
connection and Click-to-Call advertiser listings. Advertisements based on search
requests, are expected to continue as the leading revenue generator in
the Internet Search Industry. The traffic surrounding search application is expected to have a viral impact to
our other online products, such as classifieds and Click-to-Call.

hereUare plans to jumpstart the viral marketing effect with
identified vertical market segments and partners. We are in the processing of
establishing relationships with Vietnam's telecommunications authorities and
the Christian Life Church (CLC), although no assurance can be given that these
relationships will be commercially meaningful. These relationships, once secured, will be part of our first commercial launch for Search
and VoIP applications, including the possibility of hereUare  being the default VoIP provider and search engine for
the people of Vietnam and the seven million members of the CLC community in the
U.S. We plan to channel our marketing communications that target unique users through
promotion with sponsorships, radio stations, bulletin board groups, and
community events. These relationships are expected to drive traffic through HUA
products and the strategy is designed to attract eyeballs to the hereUare website.

The Messaging/Groupware product line will be targeted to Small Medium Businesses (SMBs) and consumers, thus requiring
two different communication channels. As a broad market strategy, our marketing plan encompasses a mix of brand
awareness and sales oriented marketing, which consists of online and offline components. The online initiatives
include banner ads across large networks media and community sponsorships. Offline initiatives
include radio, print, and event sponsorships (i.e. CLC events or conventions). Also, we plan to schedule
of press conferences and press releases to promote the brand name while keeping it fresh in the minds of web
users, industry analysts, commentators and news organizations.

Sales-oriented marketing is intended to drive sales of our revenue generating
products. We plan to employ both online and offline components in our sales focused campaign. Online initiatives
will include keyword marketing campaigns, targeted banner advertisements, email lists, and
contextual text links. Offline campaigns will focus on direct marketing strategies that will include mailings and
inserts in relevant publications.

The Internet is a consumer market, and by its nature, brand recognition is
essential to viral marketing to attract and retain traffic. The Company believes
that its brand and domain name promotes a central Internet destination that serves  the needs of the user. As a brand, the hereUare message delivers the
Company's mission as a one-stop destination. 'hereUare' is easily pronounced and understood
by non-English speaking users, enhancing its acceptance as a global brand. The
Internet domain name has become a valuable commodity creating a serious
challenge to find a name that will resonate with consumers, at the same time
serve as the Company's mission. hereUare has  registered and trademarked its brand
name and related products.

Online, the Company plans to promote its brand through the Internet with the use of sponsored
links and vertical event sponsorships. As described above, sponsorship of events in large
communities similar to the Christian Life Church mirrors the viral marketing
effect and creates brand awareness. In partnership or in a syndicated
situation, the hereUare logo is to be used followed by the "Powered by hereUare"tagline.

hereUare has been granted two US patents in the Wifi-Wimax
industry (one in February 2006 and one in February 2007). However, the Company
has not included the use of the technology covered by these two patents in its
current plans.

The Company has tested its products internally only on a limited scale. There
can be no assurance that the Company's suite of products will prove commercially
ready when tested on a larger scale by third parties. The Company has not
generated significant revenue to date from its products.

Employees

As of March 31, 2007, we have eleven full-time and two part-time employees.

Item 2. Description of Property

On February 16, 2005, the Company entered into a 3-year lease
agreement with CarrAmerica Techmart for approximately 4,900 square feet of space
in the Techmart building located at 5201 Great America Parkway, Santa Clara,
California. This lease expires on March 1, 2008, and the current rent payment is
approximately $11,000 per month.

On June 8, 2006, the Company entered into a 5-year lease agreement with
CarrAmerica Techmart for approximately 2,700 square feet of additional space in
the same building. This lease expires on June 15, 2011 and current rent payment
is approximately $7,000 per month.

Item 3. Legal Proceedings

No lawsuits or proceedings are currently
pending against hereUare.

Item 4. Submission of Matters to Vote of Security Holders

Not applicable.

PART II

Item 5. Market for Common Equity and Related Stockholder Matters

Market Information

There is currently no active market for our securities.

Holders

As of December 31, 2006 there were approximately 231 holders or record of our
common stock. The number of record holders does not include beneficial owners
whose shares are held in the names of banks, brokers, nominees or other
fiduciaries.

Dividends

hereUare has not declared or paid any cash dividends on its common stock. It
intends to retain any future earnings to finance the growth and development of
its business, and therefore it does not anticipate paying any cash dividends on
its common stock in the future. The board of directors will determine any future
payment of cash dividends depending on the financial condition, results of
operations, capital requirements, general business condition and other relevant
factors. If the Company issues preferred shares, although not currently
anticipated, no dividends may be paid on the outstanding common stock until all
dividends then due on the outstanding preferred stock will have been paid.

Securities Authorized for Issuance under Equity Compensation Plans

As of December 31, 2006, the table below provides the indicated information
with respect to compensation plans.

`(c)
                                                                     Number of
                                 (a)                                 securities remaining
                               Number of            (b)              available for
                               securities to      Weighted           future issuance
                               be issued upon     average exercise   under equity
                               exercise of        price of           compensation
                               outstanding        outstanding        plans(excluding
                               options, warrants  options, warrants  securities reflected
Plan Category                  and rights         and rights         in column(a))
-----------------------------  -----------------  -----------------  --------------------
Equity compensation plans
approved by security holders          -                 -                 -

Equity compensation plans not
approved by security holders      6,927,999         $1.46             13,322,001
                                  =========         =====             ==========`

Recent Sales of Unregistered Securities; Use of Proceeds from
Registered Securities

In the quarterly period ended December 31, 2006, the Company sold an
aggregate of 65,419 shares of $0.0001 par value common stock to 12 individuals
in a private placement exempt from registration under Rule 506 of Regulation D
of the Securities Act of 1933. The shares were sold at a price of $6.00 per
share for an aggregate proceed of $392,500. All of the investors were accredited
investors.

Registrant Share Purchases

There were no purchases made by or on behalf of Registrant or any "affiliated
purchaser" (as defined in Exchange Act Rule 10b-18(a)(3)) of shares of
Registrant's $0.0001 par value common stock during the fourth quarter of fiscal
2006.

Item 6. Management's Discussion and Analysis or Plan of Operation

The following section discusses the significant operating
changes, business trends, financial condition, earnings and liquidity that have
occurred in the one-year period ended December 31, 2006. This discussion should
be read in conjunction with the Company's consolidated financial statements and
notes appearing elsewhere in this report.

The following discussion may contain forward-looking statements that are
subject to risks and uncertainties. When used in this discussion, the words
"believes," "anticipates" and "intends" and similar expressions are intended to identify forward-looking statements, but the
absence of these words does not necessarily mean that a statement is not forward looking. Forward-looking statements include,
but are not limited to, statements about our expansion plans, objectives, expectations, intentions, and target markets, and
are subject to risks and uncertainties that could cause actual results to differ materially from those anticipated in these
forward-looking statements for may reasons, including the factors described under
"Risk Factors Affecting Future Performance," "Description of Business" and elsewhere in this report. We undertake no obligation to publicly release any revisions to these
forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence
of anticipated events. Readers are urged, however, to review the factors and risks we describe in reports we file from time to
time with the Securities and Exchange Commission, which may be accessed at the Commission's website at www.sec.gov.

Recent Accounting Pronouncements

In March 2006 FASB issued SFAS 156
"Accounting for Servicing of Financial Assets". This Statement amends FASB
Statement No. 140, "Accounting for Transfers and Servicing of Financial Assets
and Extinguishments of Liabilities", with respect to the accounting for
separately recognized servicing assets and servicing liabilities. This
Statement:

1. Requires an entity to recognize a servicing asset or
servicing liability each time it undertakes an obligation to service a financial
asset by entering into a servicing contract;

2. Requires all separately recognized servicing assets and
servicing liabilities to be initially measured at fair value, if practicable;

3. Permits an entity to choose 'Amortization method' or 'Fair
value measurement method' for each class of separately recognized servicing
assets and servicing liabilities;

4. At its initial adoption, permits a one-time reclassification of available-for-sale
securities to trading securities by entities with recognized servicing rights,
without calling into question the treatment of other available-for-sale
securities under Statement 115, provided that the available-for-sale securities
are identified in some manner as offsetting the entity's exposure to changes in
fair value of servicing assets or servicing liabilities that a servicer elects
to subsequently measure at fair value;

5. Requires separate presentation of servicing assets and servicing liabilities subsequently
measured at fair value in the statement of financial position and additional
disclosures for all separately recognized servicing assets and servicing
liabilities.

This Statement is effective as of the
beginning of the Company's first fiscal year that begins after September 15,
2006. Management believes that this statement will not have a significant impact
on the consolidated financial statements.

In September 2006, FASB issued SFAS
157 'Fair Value Measurements'. This Statement defines fair value, establishes a
framework for measuring fair value in generally accepted accounting principles (GAAP),
and expands disclosures about fair value measurements. This Statement applies
under other accounting pronouncements that require or permit fair value
measurements, the Board having previously concluded in those accounting
pronouncements that fair value is the relevant measurement attribute.
Accordingly, this Statement does not require any new fair value measurements.
However, for some entities, the application of this Statement will change
current practice. This Statement is effective for financial statements issued
for fiscal years beginning after November 15, 2007, and interim periods within
those fiscal years. The management is currently evaluating the effect of this
pronouncement on financial statements.

In September 2006, FASB issued SFAS
158 "Employers' Accounting for Defined Benefit Pension and Other Postretirement
Plans - an amendment of FASB Statements No. 87, 88, 106, and 132(R)". This
Statement improves financial reporting by requiring an employer to recognize the
over funded or under funded status of a defined benefit postretirement plan
(other than a multiemployer plan) as an asset or liability in its statement of
financial position and to recognize changes in that funded status in the year in
which the changes occur through comprehensive income of a business entity or
changes in unrestricted net assets of a not-for-profit organization. This
Statement also improves financial reporting by requiring an employer to measure
the funded status of a plan as of the date of its year-end statement of
financial position, with limited exceptions. An employer with publicly traded
equity securities is required to initially recognize the funded status of a
defined benefit postretirement plan and to provide the required disclosures as
of the end of the fiscal year ending after December 15, 2006. An employer
without publicly traded equity securities is required to recognize the funded
status of a defined benefit postretirement plan and to provide the required
disclosures as of the end of the fiscal year ending after June 15, 2007.
However, an employer without publicly traded equity securities is required to
disclose the following information in the notes to financial statements for a
fiscal year ending after December 15, 2006, but before June 16, 2007, unless it
has applied the recognition provisions of this Statement in preparing those
financial statements:

a. A brief description of the provisions of this Statement

b. The date that adoption is required

c. The date the employer plans to adopt the recognition provisions of this
Statement, if earlier.

The requirement to measure plan assets and benefit
obligations as of the date of the employer's fiscal year-end statement of
financial position is effective for fiscal years ending after December 15, 2008.
The management is currently evaluating the effect of this pronouncement on
financial statements.

Critical Accounting Policies

In the ordinary course of business, the Company has made a number of estimates and assumptions relating to the reporting of results of operations and financial condition in the preparation of its financial statements in conformity with accounting principles generally accepted in the United States of America. Actual results could differ significantly from those estimates under different assumptions and conditions. The Company believes that the following discussion addresses the Company's most critical accounting policies, which are those that are most important to the portrayal of the Company's financial condition and results
or because their application requires significant management judgment, are
described in the following paragraphs. The Company constantly re-evaluates these significant factors and makes adjustments where facts and circumstances dictate. Although historically, actual results have not significantly deviated from those determined using the necessary estimates inherent in the preparation of financial statements, future actual results may vary significantly. Estimates and assumptions include, but are not limited to, customer receivables, long-term asset lives, contingencies and litigation. The Company has also chosen certain accounting policies when options were available, including:

- The intrinsic value method, or APB Opinion No. 25, to account for our common stock incentive awards; and
- We record an allowance for credit losses based on estimates of customers' ability to pay. If the financial condition of our customers were to deteriorate, additional allowances may be required.
- The Company expects to apply the provisions of Statement of Position 97-2 as well as SAB 101, to account for the sales of software and related services that may be bundled with the software license.

These accounting policies are applied consistently for all years presented. Our operating results would be affected if other alternatives were used. Information about the impact on our operating results is included in the footnotes to our consolidated financial statements.

Results of Operation

hereUare, whose name was changed from PeopleNet International
Corporation on March 26, 2007 to hereUare, Inc., was formed in February 1997, under the name
American Champion Media, as a wholly owned subsidiary of Pacific Systems Control
Technology ("PSCT"), formerly known as American Champion Entertainment.
Through a spin-off transaction on February 8, 2002, hereUare became an
independent entity and PSCT distributed its shares of hereUare to
the shareholders of PSCT as of the record date of January 16, 2002. Throughout
the year ended December 31, 2006, the Company was primarily developing products
and was not generating revenues.

Revenues

During the year ended December 31, 2006, we only generated sales of $38,118
which was mainly from the Company's VoIP product. Cost of goods was 
$77,328 which included domestic and international telecom termination charges
for testing purposes, resulted in a gross loss figure of ($39,210). 
Revenues for the year ended December 31, 2005 was insignificant.

Costs and Expenses

For the year ended December 31, 2006 our payroll expenses were
$911,095 which reflected an increase in engineering and marketing staff as
compared to $151,345 for the previous year.  For the year ended December 31,
2006, we also incurred professional fees of $551,236
which included $170,360 for
legal, $90,265 for accounting, $270,191 in consulting fees for software engineering and
business consultation, and $6,210 for stock transfer. In the prior year, we had
professional fees in the amount of $339,114.

General and administrative expenses for the year ended December 31, 2006
were $11,674,758 which included non-cash option expenses in the amount of $10,044,900
estimated by using a Black-Scholes option pricing model, and also a non-cash
expense of $1,238,303 due to issuance of a warrant to purchase 750,000 shares of
the Company's stock at $6 per share. The warrant was issued as a settlement of a
dispute between the Company and three related stockholders involving, among
other items, whether the stockholders had previously purchased a 1,000,000 share
warrant. Other components of G&A
expenses include $61,561 for insurance, $25,144 for Internet services and
$24,576 for travel. G&A expenses for 2005 were $377,687 which included $270,954
in non-cash compensation charges, $11,936 for internet related services and
$14,965 for insurance.

Our rent expenses were $216,435 and $162,600 for the years
ended December 31, 2006 and 2005.

Depreciation and amortization expenses were $97,041 and
$15,955 for the years ended December 31, 2006 and 2005.

As a result of foregoing factors, our net loss was
($13,484,750) for the year ended December 31, 2006, as compared to ($1,034,957) for the year ended December 31, 2005. Net loss per share
increased to ($0.63) in 2006
from ($0.06) in 2005, while weighted average number of shares outstanding
increase to 21,431,409 by the end of the year 2006 from 16,394,546
of a year ago.

Liquidity and Capital Resources

Net cash flows for the twelve months ended December 31, 2006
were
a negative ($1,158,743).
There was a net inflow of $1,057,770 from financing activities. Cash flow from operating activities
was a negative ($2,299,601) on a consolidated basis while net cash gained from
investing activities was $83,084.

Our Company  has not generated significant revenues from our
operations over the last several years and management remains doubtful whether
enough revenues can be generated in the next twelve months to sustain our
operations. We will be seeking substantial funding  within the next year for
introducing and marketing  our
suite of software products. Otherwise, we will not be able to
introduce them in a large-scale manner and may have to scale down our
operations.

As a result of limited capital resources and insignificant revenues from operations, the Company has relied on
the issuance of equity securities in financing transactions for our operational
needs. The independent auditor's report on the Company's December 31, 2006
financial statements included in this report states that there is
substantial doubt about our Company's ability to continue as a going concern. In the event that financing activities cannot generate adequate funds to
launch our marketing efforts, we intend to curtail our operations until such
funds are available. Although the Company continues to seek financing to
support our working capital needs, we have no assurance that we will be
successful in raising the funds required. In the event that the Company is not
successful in generating sufficient capital resources on terms acceptable to us,
there could be a material adverse effect on our business, results of operations,
liquidity and financial condition.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.



Item 7. Financial Statements

The financial statements of the Company and the independent registered public
accounting firm's report are filed herewith on pages 17 through 38 of this report.



Item 8. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure.

Not applicable.

Item 8A

a) Evaluation of Disclosure Controls and Procedures. We maintain disclosure controls and
procedures that are designed to ensure that information required to be
disclosed by us in reports that we file or submit under the Securities Exchange
Act of 1934 is recorded, processed, summarized, and reported within the time
periods specified in Securities and Exchange Commission rules and forms, and
that such information is accumulated and communicated to our management,
including our Chief Executive Officer and Chief Financial Officer, as
appropriate, to allow timely decisions regarding required disclosure. In
designing and evaluating our disclosure controls and procedures, management
recognized that disclosure controls and procedures, no matter how well
conceived and operated, can provide only reasonable, not absolute, assurance
that the objectives of the disclosure controls and procedures are met. Our
disclosure controls and procedures have been designed to meet, and management
believes that they meet, reasonable assurance standards. Additionally, in
designing disclosure controls and procedures, our management necessarily was
required to apply its judgment in evaluating the cost-benefit relationship of
possible disclosure controls and procedures. The design of any disclosure
controls and procedures also is based in part upon certain assumptions about
the likelihood of future events, and there can be no assurance that any design
will succeed in achieving its stated goals under all potential future
conditions.

Based on their evaluation as of December 31, 2006, our Chief Executive Officer and
Chief Financial Officer have concluded that, subject to the limitations noted
above, as of such date, our disclosure controls and procedures were effective
at the reasonable assurance level.

(b) Changes in Internal Control over Financial Reporting. Our internal control over our
financial reporting is designed to provide reasonable assurance regarding the
reliability of our financial reporting and the preparation of financial
statements for external purposes in accordance with U.S. generally accepted
accounting principles. Internal control over financial reporting includes those
policies and procedures that: (i) pertain to the maintenance of records
that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of our assets; (ii) provide reasonable assurance that
transactions are recorded as necessary to permit preparation of financial
statements in accordance with U.S. generally accepted accounting principles,
and that receipts and expenditures of the Company are being made only in
accordance with authorizations of our management and directors; and
(iii) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use or disposition of our assets that
could have a material effect on the financial statements. There were no
significant changes in the Company's internal control over financial reporting
that occurred during the fourth quarter of fiscal year 2007 that have
materially affected, or are reasonably likely to materially affect, the
Company's internal control over financial reporting.

(c) Inherent Limitations on Effectiveness of Controls.Our management, including our
Chief Executive Officer and our Chief Financial Officer, does not expect that
our disclosure controls and procedures or our internal control over financial
reporting will prevent or detect all errors and all fraud. Any control system,
no matter how well designed and operated, can provide only reasonable, not
absolute, assurance that the control system's objectives will be met. The
design of a control system must reflect the fact that there are resource
constraints and competing use of resources, and the benefits of controls must
be considered relative to their costs in light of competing demands on limited
resources. Further, because of the inherent limitations in all control systems,
no evaluation of controls can provide absolute assurance that misstatements due
to error or fraud will not occur or that all control issues and instances of
fraud, if any, within the company have been detected. These inherent
limitations include the realities that judgments in decision-making can be
faulty and that breakdowns can occur because of simple error or mistake.
Controls can also be circumvented by the individual acts or omissions of some
persons, by collusion of two or more people, or by management override of the
controls. The design of any system of controls is based in part on certain
assumptions about the likelihood of future events, and there can be no
assurance that any design will succeed in achieving its stated goals under all
potential future conditions. Over time, controls may become inadequate because
of changes in conditions or deterioration in the degree of compliance with
policies or procedures.

Item 8B. Other Information.

None.



PART III

Certain information required by Part III is incorporated by reference from
our definitive Proxy Statement or Information Statement to be filed with the
Securities and Exchange Commission on or before April 30, 2007 (the "2007
Statement").

Item 9. Directors, Executive Officers, Promoters and Control Person;
Compliance with Section 16 (a) of the Exchange Act

The information required by this Item is set forth in the 2007 Statement
under the captions "Directors and Executive Officers of the Registrant" and
"Executive Compensation" and is incorporated herein by reference, except that:

(1) where this Item calls for disclosure of any known late filings or failure
by an insider to file a report required by Section 16(a) of the Securities Act,
such information is contained in the 2007 Statement under the caption "Section
16(a) Beneficial Ownership Reporting Compliance" and is incorporated herein by
reference.

(2) where this Item calls for disclosure regarding the composition of the
audit committee of our Board of Directors and whether or not we have a financial
expert serving on the audit committee of our Board of Directors, and if so who
that individual is, such information is contained in the 2007 Statement under
the caption "Board Meeting and Committees and Audit Committee Financial Expert"
and is incorporated herein by reference.

(3) where this Item calls for disclosure regarding a code of ethics, such
information is contained in the 2007 Statement under the caption "Code of
Ethics".



Item 10. Executive Compensation

The information required by this Item is set forth in the
2007 Statement under the caption "Executive Compensation", "Director
Compensation", and "Stock Option Tables" and is incorporated herein by
reference.



Item 11. Security Ownership of Certain Beneficial Owners and Management

Information related to security ownership of certain beneficial owners and
security ownership of management is set forth in the 2007 Statement under the
caption "Security Ownership of Certain Beneficial Owners and Management" and is
incorporated herein by reference, and information related to our equity
compensation plans is set forth in the 2007 Statement under the caption "Equity
Compensation Plan Information" and is incorporated herein by reference.



Item 12. Certain Relationships and Related Transactions

Information related to certain relationships and related
transactions is set forth in the 2007 Statement under the caption "Certain
Relationships and Related Transactions" and is incorporated herein by reference.



PART IV

Item 13. Exhibits

(a) Exhibits and Index of Exhibits.

See Index to Exhibits on page    38 of this Form 10-KSB.



Item 14. Principal Accountant Fees and Services

Information related to principal accountant fees and services
is set forth in the 2007 Statement under the caption "Principal Accountant Fees
and Services" and is incorporated herein by reference.



---

SIGNATURES

In accordance with Section 13 or 15 (d) of the Securities
Exchange Act of 1934, the Registrant has caused this Report to be signed on its
behalf by the undersigned, thereunto duly authorized.

Dated: April 12, 2007



POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes
and appoints each of Benedict Van and Anthony K. Chan as his attorney-in-fact,
with the power of substitution, for him in any and all capacities, to sign  this report on Form 10-KSB, and to file the same,
with exhibits thereto and other documents in connection therewith, with the Securities and
Exchange Commission, hereby ratifying and confirming all that said
attorney-in-fact, or his substitute or substitutes, may do or cause to be done
by virtue hereof.



In accordance with the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.



|Signature                             | Title                                                                                            | Date          
|------------------------------------- | ------------------------------------------------------------------------------------------------ | --------------
|By: /s/ Benedict Van
    Benedict Van | Chief Executive Officer (Principal
    Executive Officer) and Chairman of the Board of Directors | April 12, 2007

|By: /s/ Anthony K. Chan
    Anthony K. Chan | Chief Financial Officer (Principal
    Financial Officer) and Member of the Board of Directors | April 12, 2007
|------------------------------------------- | ---------------------------------------------------------------------------------------------- | --------------

|By: /s/ James McCargo
    James McCargo | Member of the Board of Directors | April 12, 2007
|--------------------------------------- | -------------------------------- | --------------

|By: /s/ David A. Brewer
    David A. Brewer | Member of the Board of Directors | April 12, 2007
|------------------------------------------- | -------------------------------- | --------------

|By: /s/ Gregory B. Pelling
    Gregory B. Pelling | Member of the Board of Directors | April 12, 2007
|------------------------------------------------- | -------------------------------- | --------------

---

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders and Board of Directors
hereUare, Inc. and subsidiaries
(formerly known as PeopleNet International Corporation)

We have audited the accompanying consolidated balance sheet of hereUare, Inc. and subsidiaries
(formerly known as PeopleNet International Corporation) a Delaware Corporation (the "Company") as of December 31, 2006
and the related consolidated statements of operations, stockholders' equity and cash flows for the years ended
December 31, 2006 and 2005. These consolidated financial statements are
the responsibility of the Company's management. Our responsibility is to
express an opinion on these consolidated financial statements based on our audits.

We conducted our audit of these statements in
accordance with the standards of the Public Company Accounting Oversight Board
(United States). Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the consolidated
financial statements are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the consolidated financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall consolidated
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated
financial statements referred to above present fairly, in all material
respects, the consolidated financial position of hereUare, Inc. and subsidiaries
(formerly known as PeopleNet International Corporation) as of December 31, 2006 and the results of their operations
and cash flows for the years ended December 31, 2006 and 2005, in conformity
with accounting principles generally accepted in the United States of America.

The Company's consolidated financial statements are prepared using the generally
accepted accounting principles applicable to a going concern, which contemplates the realization of assets
and liquidation of liabilities in the normal course of business. The Company has accumulated deficit of
$65,009,435 including net losses of $13,484,750 and $1,034,957 for the years ended December 31, 2006 and 2005,
respectively. These factors as discussed in Note 15 to the consolidated financial statements raise substantial
doubt about the Company's ability to continue as a going concern. Management's plans in regard to these
matters are also described in Note 15. The consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty.

KABANI & COMPANY, INC.
CERTIFIED PUBLIC ACCOUNTANTS

Los Angeles
March 15, 2007

---

HEREUARE, INC. AND SUBSIDIARIES
(formerly known as PeopleNet International Corporation)
CONSOLIDATED BALANCE SHEET
DECEMBER 31, 2006 AND 2005

`ASSETS
                                                  2006
                                              ------------
CURRENT ASSETS:
  Cash & cash equivalents                     $   138,317
  Account receivable                                  158
  Prepaid expenses                                 37,776
  Related party receivable                            840
  Advances                                        257,539
                                              ------------
    Total current assets                          434,630

PROPERTY & EQUIPMENT - net                        257,713

INTANGIBLE ASSETS - net                           166,814

DEPOSITS                                           43,645

INVESTMENT                                      1,000,000
                                              ------------
                                              $ 1,902,802
                                              ============

          LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
  Accounts payable and accrued expenses       $   458,314
  Deferred revenue                                  1,092
                                              ------------
    Total current liabilities                     459,406
                                              ------------

STOCKHOLDERS' EQUITY:
  Preferred stock, $0.0001 par value;
    10,000,000 shares authorized;
    none issued                               $       -
  Common stock, $0.0001 par value;
    100,000,000 shares authorized;
    33,704,668 shares issued and
    outstanding                                     3,371
  Additional paid-in capital                   66,461,460
  Subscription receivable                         (12,000)
  Deferred compensation charges                       -
  Accumulated deficit                         (65,009,435)
                                              ------------
    Total Stockholders' Equity                  1,443,396
                                              ------------
                                              $ 1,902,802
                                              ============`

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

---

HEREUARE, INC. AND SUBSIDIARIES
(formerly known as PeopleNet International Corporation)
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 2006 AND 2005

`2006          2005
                                              -------------  ------------

REVENUES                                      $     38,118   $     9,069
COST OF REVENUES                                    77,328           -
                                              -------------  ------------
  Gross Profit (Loss)                              (39,210)        9,069

OPERATING EXPENSES
  Depreciation and amortization                     97,041        15,955
  Rent                                             216,435       162,600
  Salaries and payroll taxes                       911,095       151,345
  Professional fees                                551,236       339,114
  General and administrative                    11,674,758       377,687
                                              -------------  ------------
    Total Costs and Expenses                    13,450,565     1,046,701

                                              -------------  ------------
LOSS FROM OPERATIONS                           (13,489,775)   (1,037,632)

OTHER INCOME (EXPENSE)
  Interest income (expense)                          5,825         3,475
                                              -------------  ------------
                                                     5,825         3,475

LOSS BEFORE INCOME TAXES                       (13,483,950)   (1,034,157)

PROVISION FOR INCOME TAXES                             800           800
                                              -------------  ------------
NET LOSS                                      $(13,484,750)   (1,034,957)
                                              =============  ============

Basic & diluted weighted average number
  of common stock outstanding                   21,431,409    16,394,546
                                              =============  ============

Basic and diluted net loss per share          $      (0.63)        (0.06)
                                              =============  ============`

Weighted average number of shares used to compute basic and diluted loss per share is the same since the effect of dilutive securities is anti-dilutive.

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

---

HEREUARE, INC. AND SUBSIDIARIES
(formerly known as PeopleNet International Corporation)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
FOR THE YEARS ENDED DECEMBER 31, 2006 AND 2005

`Common Stock
                                -----------------   Additional   Subscrip-    Deferred                       Total
                                 Number              Paid-In       tion     Compensation   Accumulated    Stockholders'
                                of shares  Amount    Capital    Receivable     Charges       Deficit     Equity(Deficit)
                               ----------  ------  -----------  ----------  ------------  -------------  ---------------
Balance, as of
January 1, 2005                16,066,499  $1,607  $19,713,339  $     -     $  (361,272)  $(19,679,930)  $   (326,256)
                               ----------  ------  -----------  ----------  ------------  -------------  -------------

Shares issued for cash            994,500      99    1,988,901        -             -              -        1,989,000

Shares issued for
subscription receivable            25,500       3       50,997    (51,000)          -              -              -

Amortization of deferred
  compensation charges                -       -            -          -         270,954            -          270,954

Net loss for the year                 -       -            -          -             -       (1,034,957)    (1,034,957)
                               ----------  ------  -----------  ----------  ------------  -------------  -------------
Balance, as of
December 31, 2005              17,086,499  $1,709  $21,753,237  $ (51,000)  $   (90,318)  $(20,714,886)  $    898,742
                               ----------  ------  -----------  ----------  ------------  -------------  -------------

Shares issued for cash            582,669      58    1,426,942    (12,000)          -              -        1,415,000

Shares issued against advance
  for shares to be issued          50,000       5      118,995     51,000           -              -          170,000

Shares issued in acquisition
  of hereUare Communications   15,985,500   1,599   31,969,401        -             -      (30,809,799)     1,161,201

Amortization of deferred
  compensation charges                -       -            -          -          90,318            -           90,318

Option expenses                       -       -      9,954,582        -             -              -        9,954,582

Issuance of warrant in
  dispute settlement                  -       -      1,238,303        -             -              -        1,238,303

Net loss for the year                 -       -            -          -             -      (13,484,750)   (13,484,750)
                               ----------  ------  -----------  ----------  ------------  -------------  -------------
Balance, as of
December 31, 2006              33,704,688  $3,371  $66,461,460  $ (12,000)  $       -     $(65,009,435)  $  1,443,396
                               ==========  ======  ===========  ==========  ============  =============  =============`

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

---

HEREUARE, INC. AND SUBSIDIARIES
(formerly known as PeopleNet International Corporation)
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2006 AND 2005

`2006           2005
                                                         -------------   ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net Loss                                               $(13,484,750)   $(1,034,957)
  Adjustments to reconcile net loss to net cash
    used in operating activities:
      Depreciation and amortization                            97,041         15,954
      Options granted for services                          9,954,582            -
      Deferred compensation charges                            90,318        270,954
      Warrants granted for dispute settlement               1,238,303            -
      (Increase) / decrease in current assets:
          Prepaid rent                                            -          (46,542)
          Prepaid expenses                                   (227,312)           -
          Account receivable                                  (28,553)           -
          Deposits                                             56,498        (98,149)
          Advance to related parties                             (840)           -
      Increase / (decrease) in current liabilities:
          Accounts payable & accrued expenses                   4,024          1,107
          Advance from related party                              -          (40,401)
          Deferred revenue                                      1,092            -
                                                         -------------   ------------
      Net cash used in operating activities                (2,299,601)      (932,033)
                                                         -------------   ------------

CASH FLOWS FROM INVESTING ACTIVITIES
  Acquisition of equipments and intangible assets            (391,767)       (95,033)
  Cash from acquired subsidiary                               474,851            -
                                                         -------------   ------------
  Net cash provided by / (used in) investing activities        83,084        (95,033)
                                                         -------------   ------------

CASH FLOWS FROM FINANCING ACTIVITIES
  Proceeds from issuance of common stock                    1,415,000      1,989,000
  Proceeds from shares to be issued                               -           18,000
  Payment of notes from related parties                      (357,230)        (4,500)
                                                         -------------   ------------
      Net cash provided by financing activities             1,057,770      2,002,500
                                                         -------------   ------------

NET INCREASE (DECREASE) IN CASH & CASH EQUIVALENTS         (1,158,743)       975,434

CASH & CASH EQUIVALENTS, beginning balance                  1,297,060        321,626
                                                         -------------   ------------
CASH & CASH EQUIVALENTS, end balance                     $    138,317    $ 1,297,060
                                                         =============   ============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

  Cash paid during the period for

    Interest                                             $        -      $       -
                                                         =============   ============
    Income taxes                                         $        800    $       800
                                                         =============   ============
    Stock issued for acquisition                         $ 31,971,000    $       -
                                                         =============   ============`

``

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

---

HEREUARE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Note 1 - Nature of Operations, Stock Split, and Spin-off

Nature of Operations

In December 2005, the Company formed Completo Communications
Corporation ("Completo"),
a wholly owned subsidiary, to support
voice termination services within the Company's international VoIP solutions.
The operations of Completo were terminated by the end of the quarterly period
ended March 31, 2006 and the VoIP termination activities were handled within the
Company since then.

On September 22, 2006, the Company acquired  100% of hereUare Communications, Inc., a Delaware corporation
("hereUare"). hereUare is an operator of web-based search engine and
other Internet software solutions founded in 2002. Consequently, hereUare's financial position, results of operations
and cash flows subsequent to the acquisition are included in the accompanying audited consolidated financial statements.

Note 2 - Summary of Significant Accounting Policies

Basis of Presentation: The accompanying consolidated financial statements have been prepared
in conformity with accounting principles generally accepted in the United States of America.

Principles of Consolidation: The accompanying consolidated financial statements
include the accounts of the Company and its wholly owned subsidiaries, Completo
Communications Corporation and hereUare Communications, Inc. All material inter-company accounts have been
eliminated in consolidation.

Use of Estimates, Risks and Uncertainties - The
preparation of financial statements in conformity with generally accepted
accounting principles in the United States ("GAAP") requires management to make
certain estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates  include the
collectibility of accounts receivable, accounts payable, sales returns and recoverability of
long-term assets.



Cash and cash equivalents - The Company considers all liquid investments with a maturity of three months or less from the date of purchase that are readily convertible into cash to be cash equivalents.

Property and Equipment - Property and equipment is
stated at cost. Depreciation for property and equipment is computed using the
straight-line method over an estimated useful life of three years for computer
equipment and five years for non-electronic property.



Long-lived assets - Effective January 1, 2002, the Company adopted Statement of Financial Accounting Standards No. 144,
"Accounting for the Impairment or Disposal of Long-Lived Assets" ("SFAS 144"), which addresses financial accounting and reporting for the impairment or disposal of long-lived assets and supersedes SFAS No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of," and the accounting and reporting provisions of APB Opinion No. 30,
"Reporting the Results of Operations for a Disposal of a Segment of a Business."  The Company periodically evaluates the carrying value of long-lived assets to be held and used in accordance with SFAS 144.  SFAS 144 requires impairment losses to be recorded on long-lived assets used in operations when indicators of impairment are present and the undiscounted cash flows estimated to be generated by those assets are less than the assets' carrying amounts.  In that event, a loss is recognized based on the amount by which the carrying amount exceeds the fair market value of the long-lived assets.  Loss on long-lived assets to be disposed of is determined in a similar manner, except that fair market values are reduced for the cost of disposal.



Intangible Assets - The Company evaluates intangible
assets for impairment, at least on an annual basis and whenever events or
changes in circumstances indicate that the carrying value may not be recoverable
from its estimated future cash flows. Recoverability of intangible assets, other
long-lived assets and, goodwill is measured by comparing their net book value to
the related projected undiscounted cash flows from these assets, considering a
number of factors including past operating results, budgets, economic
projections, market trends and product development cycles. If the net book value
of the asset exceeds the related undiscounted cash flows, the asset is
considered impaired, and a second test is performed to measure the amount of
impairment loss.



Software development costs - The Company has adopted
Statement of Position 98-1 ("SOP 98-1") "Accounting for the Costs of Computer
Software Developed or Obtained for Internal Use", as its accounting policy for
internally developed computer software costs. Under SOP 98-1, computer software
costs incurred in the preliminary development stage are expensed as incurred.
Computer software costs incurred during the application development stage are
capitalized and amortized over the software's estimated useful life.



Revenue Recognition - Revenue from certain licensing
programs is recorded when license agreement has been executed, the software has
been delivered or shipped, the fee is determined and the customer is invoiced.
The Company has adopted the provisions of Statements of Position 97-2 and 98-4
and SEC Staff Accounting Bulletin 104. The Company did not receive any revenue from licensing agreements in the year ended
December 31, 2006.



Revenue from hosting services is recognized in the period in which the service is provided when the amount of revenue is determinable and collectability is reasonably assured. Subsequent to the year ended December 31, 2002, the Company discontinued the hosting operations.



Research and Development - Expenditures for software
development costs during the preliminary stage and research are expensed as
incurred. Such costs are required to be expensed until the point that
technological feasibility is established.

Income Taxes - The Company utilizes SFAS No. 109,
"Accounting for Income Taxes," which requires the recognition of deferred tax
assets and liabilities for the expected future tax consequences of events that
have been included in the financial statements or tax returns. Under this
method, deferred income taxes are recognized for the tax consequences in future
years of differences between the tax bases of assets and liabilities and their
financial reporting amounts at each period end based on enacted tax laws and
statutory tax rates applicable to the periods in which the differences are
expected to affect taxable income. Valuation allowances are established, when
necessary, to reduce deferred tax assets to the amount expected to be realized.



Stock-based compensation - SFAS No. 123 prescribes accounting and reporting standards for all stock-based compensation plans, including employee stock options, restricted stock, employee stock purchase plans and stock appreciation rights. SFAS No. 123 requires compensation expense to be recorded (i) using the new fair value method or (ii) using the existing accounting rules prescribed by Accounting Principles Board Opinion No. 25,
"Accounting for stock issued to employees" (APB 25) and related interpretations with proforma disclosure of what net income and earnings per share would have been had the Company adopted the new fair value method. The Company has chosen to account for stock-based compensation using Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees" and has adopted the disclosure only provisions of SFAS 123.  Accordingly, compensation cost for stock options is measured as the excess, if any, of the quoted market price of the Company's stock at the date of the grant over the amount an employee is required to pay for the stock.



The Company accounts for stock-based compensation issued to non-employees and consultants in accordance with the provisions of SFAS
123 and the Emerging Issues Task Force consensus in Issue No. 96-18 ("EITF 96-18"),
"Accounting for Equity Instruments that are Issued to Other Than Employees for Acquiring or in Conjunction with Selling, Goods or Services". Valuation of shares for services is based on the estimated fair market value of the services performed.



Basic and diluted net loss per share - Net loss per share is calculated in accordance with the Statement of financial accounting standards No. 128 (SFAS No. 128),
"Earnings per share". SFAS No. 128 superseded Accounting Principles Board Opinion No.15 (APB 15). Net loss per share for all periods presented has been restated to reflect the adoption of SFAS No. 128. Basic net loss per share is based upon the weighted average number of common shares outstanding. Diluted net loss per share is based on the assumption that all dilutive convertible shares and stock options were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options and warrants are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period.



Fair value of financial instruments - Statement of financial accounting standard No. 107, Disclosures about fair value of financial instruments, requires that the Company disclose estimated fair values of financial instruments. The carrying amounts reported in the statements of financial position for assets and liabilities qualifying as financial instruments are a reasonable estimate of fair value.



Segment Reporting - Statement of Financial Accounting
Standards No. 131 ("SFAS 131"), "Disclosure About Segments of an Enterprise and Related Information" requires use of the
"management approach" model for segment reporting. The management approach model is based on the way a company's management organizes segments within the company for making operating decisions and assessing performance. Reportable segments are based on products and services, geography, legal structure, management structure, or any other manner in which management disaggregates a company. Currently, SFAS 131 has no effect on the Company's consolidated financial statements as substantially all of the Company's operations are conducted in one industry segment.

Concentrations of Risk - Financial instruments which potentially subject the Company to concentrations of credit risk are cash and accounts receivable. The Company places its cash with financial institutions deemed by management to be of high credit quality. The amount on deposit in any one institution that exceeds federally insured limits is subject to credit risk.

Recent pronouncements -  In February 2006, FASB issued SFAS No. 155,
"Accounting for Certain Hybrid
Financial Instruments". SFAS No. 155 amends SFAS No 133, "Accounting for
Derivative Instruments and Hedging Activities", and SFAF No. 140, "Accounting
for Transfers and Servicing of Financial Assets and Extinguishments of
Liabilities".  SFAS No. 155, permits fair value remeasurement for any hybrid
financial instrument that contains an embedded derivative that otherwise would
require bifurcation, clarifies which interest-only strips and principal-only
strips are not subject to the requirements of SFAS No. 133, establishes a
requirement to evaluate interest in securitized financial assets to identify
interests that are freestanding derivatives or that are hybrid financial
instruments that contain an embedded derivative requiring bifurcation, clarifies
that concentrations of credit risk in the form of subordination are not embedded
derivatives, and amends SFAS No. 140 to eliminate the prohibition on the
qualifying special-purpose entity from holding a derivative financial instrument
that pertains to a beneficial interest other than another derivative financial
instrument.  This statement is effective for all financial instruments acquired
or issued after the beginning of the Company's first fiscal year that begins
after September 15, 2006.

In March 2006 FASB issued SFAS 156
"Accounting for Servicing of Financial Assets". This Statement amends FASB
Statement No. 140, "Accounting for Transfers and Servicing of Financial Assets
and Extinguishments of Liabilities", with respect to the accounting for
separately recognized servicing assets and servicing liabilities. This
Statement:

1. Requires an entity to recognize a servicing asset or
servicing liability each time it undertakes an obligation to service a financial
asset by entering into a servicing contract;

2. Requires all separately recognized servicing assets and
servicing liabilities to be initially measured at fair value, if practicable;

3. Permits an entity to choose 'Amortization method' or 'Fair
value measurement method' for each class of separately recognized servicing
assets and servicing liabilities;

4. At its initial adoption, permits a one-time reclassification of available-for-sale
securities to trading securities by entities with recognized servicing rights,
without calling into question the treatment of other available-for-sale
securities under Statement 115, provided that the available-for-sale securities
are identified in some manner as offsetting the entity's exposure to changes in
fair value of servicing assets or servicing liabilities that a servicer elects
to subsequently measure at fair value;

5. Requires separate presentation of servicing assets and servicing liabilities subsequently
measured at fair value in the statement of financial position and additional
disclosures for all separately recognized servicing assets and servicing
liabilities.

This Statement is effective as of the
beginning of the Company's first fiscal year that begins after September 15,
2006. Management believes that this statement will not have a significant impact
on the consolidated financial statements.

In September 2006, FASB issued SFAS
157 'Fair Value Measurements'. This Statement defines fair value, establishes a
framework for measuring fair value in generally accepted accounting principles (GAAP),
and expands disclosures about fair value measurements. This Statement applies
under other accounting pronouncements that require or permit fair value
measurements, the Board having previously concluded in those accounting
pronouncements that fair value is the relevant measurement attribute.
Accordingly, this Statement does not require any new fair value measurements.
However, for some entities, the application of this Statement will change
current practice. This Statement is effective for financial statements issued
for fiscal years beginning after November 15, 2007, and interim periods within
those fiscal years. The management is currently evaluating the effect of this
pronouncement on financial statements.

In September 2006, FASB issued SFAS
158 "Employers' Accounting for Defined Benefit Pension and Other Postretirement
Plans - an amendment of FASB Statements No. 87, 88, 106, and 132(R)". This
Statement improves financial reporting by requiring an employer to recognize the
over funded or under funded status of a defined benefit postretirement plan
(other than a multiemployer plan) as an asset or liability in its statement of
financial position and to recognize changes in that funded status in the year in
which the changes occur through comprehensive income of a business entity or
changes in unrestricted net assets of a not-for-profit organization. This
Statement also improves financial reporting by requiring an employer to measure
the funded status of a plan as of the date of its year-end statement of
financial position, with limited exceptions. An employer with publicly traded
equity securities is required to initially recognize the funded status of a
defined benefit postretirement plan and to provide the required disclosures as
of the end of the fiscal year ending after December 15, 2006. An employer
without publicly traded equity securities is required to recognize the funded
status of a defined benefit postretirement plan and to provide the required
disclosures as of the end of the fiscal year ending after June 15, 2007.
However, an employer without publicly traded equity securities is required to
disclose the following information in the notes to financial statements for a
fiscal year ending after December 15, 2006, but before June 16, 2007, unless it
has applied the recognition provisions of this Statement in preparing those
financial statements:

a. A brief description of the provisions of this Statement

b. The date that adoption is required

c. The date the employer plans to adopt the recognition provisions of this
Statement, if earlier.

The requirement to measure plan assets and benefit
obligations as of the date of the employer's fiscal year-end statement of
financial position is effective for fiscal years ending after December 15, 2008.
The management is currently evaluating the effect of this pronouncement on
financial statements.

Reclassifications - Certain comparative amounts have been reclassified to conform to the period ended December 31, 2006 presentation.

Note 3 - Property and Equipment



`Equipment                        $ 297,302
            Furniture                           33,100
                                             ----------
                                               330,402
            Less accumulated depreciation      (72,689)
                                             ----------
                                             $ 257,713
                                             ==========`

Depreciation expense was $56,959 and $15,730 for the years ended December 31, 2006 and 2005, respectively.



Note 4 - Intangible Assets

Intangible assets include software solutions and two domain names, "youarehere.com"
that the Company purchased in December 2005 and "findcom.com" in December 2006. The related accumulated amortization as of December 31, 2006
is as follows:



`Software solutions               $ 194,036
            Domain name purchased               13,085
                                             ----------
                                               207,121
            Less accumulated amortization      (40,307)
                                             ----------
                                             $ 166,814
                                             =========`

Amortization expense was $40,082 and $225 for the years ended December 31, 2006 and 2005, respectively.

Amortization expenses of intangible assets over the next
three years are as follows:

`Software     youarehere.com     findcom.com

            2007:    $ 64,789        $ 1,667           $ 2,695
            2008:    $ 64,789        $ 1,667           $ 2,470
            2009:    $ 27,209        $ 1,528               -`



Note 5 - Advances

Advances comprised of the following at December 31, 2006:

`Software development             $ 134,000
            Legal fee retainer               $  50,000
            Related party advances              73,539
                                             ----------
                                             $ 257,539
                                             ==========`

The related-party advances are travel advances to the CEO of the Company and are unsecured,
non-interest bearing and due on demand.

Note 6 - Deposits

Deposits comprised of the following at December 31, 2006:

`Rent deposit                        41,651
            Others                               1,994
                                             ----------
                                             $  43,645
                                             ==========`

Note 7 - Investments

In 2005, a subsidiary of the Company, hereUare
Communications, Inc., made a cash investment of $1,000,000 in a company engaged
in the internet search engine business. The Company acquired hereUare
Communications, Inc. in September 2006. The investment represents approximately
10.5% of that search engine company. The Company has determined that there is no
impairment of the investment at December 31, 2006 and therefore has reflected
the investment in the accompanying financial statements at cost on December 31,
2006.

Note 8 - Accounts Payable and Accrued Expenses

Account payable and accrued expenses comprised of the following at December 31, 2006:

`Accounts payable                 $  29,261
            Due to employees                       677
            Accrued litigation                  72,000
            Accrued expenses                    51,704
            Accrued interests                    6,400
            Other liabilities                  298,273
                                             ----------
                                             $ 458,315
                                             ==========`



Note 9 - Advances from Related Parties

The advances from related parties are due on demand,
non-interest bearing and unsecured; and the amount of $840 is due from eCapital Group, Inc., a company controlled by
our CEO.

Note 10 - Income Taxes

No provision was made for Federal income tax since the Company has significant net operating loss carryforward.  The Company used to file a consolidated income tax return with PSCT. The Company had net operating loss (NOL) carry forwards for federal income tax purposes of approximately $17,294,953
and for state tax purposes of $9,235,238 the benefits of which is to expire in 2014 through 2022 for federal purposes. Because of changes in ownership of the Company and PSCT, the utilization of NOLs in any one-year will be limited by Section 382 of the Internal Revenue Code. Differences between financial statement and tax losses was immaterial at December 31, 2006. The provision for income taxes consists of the state minimum tax imposed on corporations.



The following is a reconciliation of the provision for income taxes at the U.S. federal income tax rate to the income taxes reflected in the Consolidated Statements of Operations:

`2006       2005
                                                    --------   --------
    Tax expense (credit) at statutory rate-Federal    (34)%      (34)%
    State tax expense net of federal tax               (6)        (6)
    Changes in valuation allowance                     40         40
                                                    --------   --------
    Tax expense at actual rate                          -          -
                                                    ========   ========`

Income tax expense consisted of the following:

`2006         2005
                                          ----------   ----------
    Current tax expense:
    Federal                               $     -      $     -
    State                                       800          800
                                          ----------   ----------
    Total Current                         $     800    $     800


    Deferred tax credit:
    Federal                               $ 673,446    $ 352,000
    State                                   118,645       62,000
                                          ----------   ----------
    Total deferred                        $ 792,091    $ 414,000
    Less: valuation allowance              (792,091)    (414,000)
                                          ----------   ----------
    Net Deferred tax credit                     -            -

                                          ----------   ----------
    Tax expense                           $     800    $     800
                                          ==========   ==========`

Significant components of the Company's deferred tax assets and liabilities as of December 31, 2006 are as follows:

`2006            2005
                              ------------    ------------

    NOL carryforward          $ 6,434,398     $ 7,042,000
    Valuation allowance         6,434,398      (7,042,000)
                              ------------    ------------
                              $       -       $       -
                              ============    ============`

Due to the uncertainty of future taxable income and limitations related to Section 382 of the Internal Revenue Code, a 100% valuation allowance for the net amount of the deferred tax assets has been recorded at December 31, 2006.



Note 11 - Commitments and Contingencies

As a result of litigation against its prior parent
corporation, Pacific Systems Control Technology ("PSCT"), PSCT and its
subsidiaries, including the Company, entered into a global settlement and mutual
release of all claims with a former PSCT employee. Under the agreement, PSCT and
the other former parties to the litigation, including the Company, agreed to pay
to the former employee a total sum of $100,000 plus interest at the rate of 10%
per year, payable in installments at the rate of $3,000 per month. As of
December 31, 2004, the outstanding balance under the settlement agreement was
$72,000.  The Company accrued the $72,000 on its financial statements as of December 31, 2004 in the event PSCT
is unable to fulfill its obligations under the settlement agreement.

During the third and fourth quarters of fiscal year 2005, three shareholders of the Company, through
their representative, claimed that the Company made misleading representations
when the shareholders purchased a total of 826,500 shares of the Company from
2002 to 2005. The Company has reached a settlement with the three shareholders
in December 2006 which included the issuance of a three-year warrant to purchase
750,000 shares of the Company's stock at $6 per share. The non-cash expense of
the warrant in the amount of $1,238,303 was recorded in the Company's financial
statements for the year ended December 31, 2006.

On February 16, 2005, the Company entered into a 3-year lease
agreement with CarrAmerica Techmart which expires on March 1, 2008.
Remaining rent expense per this lease agreement is as following:

January - February 2007:           $10,921.91 per month
March 2007 - February 2008:   $11,249.57 per month

On June 8, 2006, the Company entered into a 5-year lease agreement with
CarrAmerica Techmart which expires on June 15, 2011. Rent expense per this new lease agreement is as following:

August 2006 - July 2007:   $7,033.55 per month
August 2007 - July 2008:   $7,243.06 per month
August 2008 - July 2009:   $7,452.57 per month
August 2009 - July 2010:   $7,692.01 per month
August 2010 - July 2011:   $7,901.52 per month

Note 12 - Related Party Transactions

During the year ended December 31, 2005, the Company agreed
to pay the CEO of the Company from $5,000 to $8,000 per month as a management
fee and $120,000 per year after the Company raises at least $1,000,000. During
the year ended December 31, 2005, the Company paid $42,616 for management fee to
its CEO; and for the year ended December 31, 2006, the Company paid $115,000 for
salary and $20,000 for contracted services to its CEO. The employment
agreement can be terminated by the Company at any time with or without cause by
written notice to the employee.

During the year ended December 31, 2005, the Company paid
$6,538 for contracted services to its CFO, and for the year ended December 31,
2006, the Company paid
$90,000 for salary and $25,870 for contracted services to its CFO. The employment agreement can be terminated by the Company at any time with
or without cause by written notice to the employee.

On September 22, 2006, the Company acquired hereUare Communications, Inc., issuing
15,985,500 Company common shares to retire an equal number of hereUare common shares. hereUare was a
privately-held operator of web-based search engine and other Internet software solutions founded in 2002.
Certain officers, directors, and major equity holders of the Company also were officers, directors or major
equity holders of hereUare. Benedict Van, the Company's Chairman of the Board and CEO, and a member of the
Company's board of directors, was the CEO and sole director of hereUare. Mr. Van and his affiliated company
owned approximately 55.6% of the outstanding hereUare common stock and therefore received 55.6% of the
Company's stock being issued in connection with the acquisition. Mr. Van and his affiliated companies owned
approximately 47.3% of the outstanding capital stock of the Company immediately prior to the acquisition and,
after the acquisition, Mr. Van and his affiliated companies owned approximately 51.3% of the outstanding
stock of the resulting company. In addition, Anthony K. Chan, a director of the Company and its CFO, was the
CFO of hereUare. The allocation of the purchase price was based on historical
cost basis rather than fair market value since Mr. Van, who is the Company's
Chairman of the Board and CEO was at the time also the sole director and
majority shareholder of hereUare Communications, Inc. The excess of the purchase
price over the historical cost basis of the net assets acquired has been shown
as a deemed dividend.

The purchase price allocation is as follows:

`Cash                                 $   474,851
     Prepaid expenses                          34,251
     Property, plant & equipment               33,326
     Intangible asset                           4,368
     Investment                             1,000,000
     Deposit                                    1,994
                                          ------------
             Total assets                   1,548,791

   Less:
     Accounts payable and accruals             30,360
     Due to related parties                   357,230
                                          ------------
           Total liabilities                  387,590

     Total acquisition cost               $ 1,161,201

   Cost
     Total investment                     $31,971,000
     Total acquisition cost                 1,161,201
                                          ------------
           Deemed dividend                $30,809,799`

Note 13 - Acquisition of hereUare Communications, Inc.

On August 25, 2006, the Company entered into an Agreement and Plan of Merger
(the "Agreement"),  with hereUare Communications, Inc., a privately-held Delaware corporation
("hereUare"). The transaction closed on September 22, 2006 and pursuant to terms of the Agreement,
the Company effectively acquired hereUare as a wholly owned subsidiary of the
Company.  hereUare is an operator of web-based search engine and other
Internet software solutions founded in 2002.  As a result, the assets and
liabilities of hereUare as of December 31, 2006 have been included in the
consolidated financial statements of this quarterly report.

The consideration paid by the Company for 100% of the outstanding shares (15,985,500 shares) of hereUare prior
to the transaction,  consisted of a total of 15,985,500 shares of newly issued common stock of the Company.

The acquisition price was determined at $31,971,000 which is determined by the
number of shares of the Company's stock issued at $2 per share, the fair
market value of the shares as evidenced by the sale of the Company's shares to
investors immediately prior to the closing of the acquisition. The amount of acquisition price
in excess of the net equity value of hereUare on the acquisition date is recorded on the consolidated balance sheet as Deemed
Dividend of $30,809,799 because major shareholder and CEO of hereUare is also
a major shareholder and CEO of the Company at the time of the acquisition.

The following is the proforma combined financial information of the Company
and hereUare, for the annual periods ended December 31, 2006 and 2005, assuming the
transaction had been consummated at the beginning of the fiscal years of 2006 and 2005:

`Proforma (unaudited)
                                         ----------------------------
                                              2006           2005
                                         -------------  -------------
Statement of Operations:
  Revenues                               $     42,810   $      9,069
  Cost of sales                                77,952          9,596
                                         -------------  -------------
  Gross profit (Loss)                         (35,142)          (527)

  Operating expenses                       13,542,787      1,184,964
                                         -------------  -------------
  Loss from operations                    (13,577,929)    (1,185,491)

  Other income                                  5,177          3,546

  Loss before income taxes                (13,572,752)    (1,181,946)

  Provision for income taxes                      800            800
                                         -------------  -------------
  Net loss                               $(13,573,552)  $ (1,182,746)
                                         =============  =============

  Basic & diluted weighted average number
  of common stock outstanding              33,274,978     32,380,046

  Basic & diluted loss /share            $      (0.41)  $      (0.04)`

Note 14 - Common Stock / Options

Common Stock

2006

During the year ended December 31, 2006, the Company issued the following amounts of common stock:

`50,000 shares     Against advance for shares to be issued
    580,669 shares     For cash
      2,000 shares     For stock subscription receivable
 15,985,500 shares     For acquisition of hereUare Communications, Inc.`

The shares issued for the acquisition of hereUare Communications, Inc. was valued at $2 per share,
the fair market value of the shares as evidenced by the sale of the Company's shares to investors immediately prior to the
closing of the acquisition.

2005

During the year ended December 31, 2005, the Company issued
994,500 shares of common stock for cash amounting to $1,986,000.

During the year ended December 31, 2005, the Company issued
25,500 shares of common stock for subscription receivable amounting to $51,000.

The subscription receivable has been written off to paid in
capital during the year ended December 31, 2006 as it was deemed irrecoverable.

Between April and May 2002, the Company issued a total of 6,680,620 stock options with exercise prices ranging from $0.08 to $0.12 per share and with gradual vesting arrangements. The Company valued these options at a total of approximately $4.5 million. In January 2006, the Board of Directors approved the extension of expiration of the remaining unexercised 4,139,999 options. Such options would have otherwise expired in May 2006 and the approval extended the expiration date for another 3 years to 2009. Expense of $8,152,695 due to the extension of those options is recorded in the year ended December 31, 2006.

On February 21, 2005, the Company granted 350,000 options
exercisable at $2 per share to one Director. 175,000 options vested on May 6,
2005; 25,000 options vested on June 30, 2005 and then 15,000 options vest per
quarter thereafter. The options expire on December 31, 2007.

On February 13, 2006, the Company granted 250,000 options
exercisable at $2 per share to one Director. 125,000 options vested immediately;
25,000 options  shall vest on each of June 30 and December 31 of 2006 and 2007; and
the last 25,000 options shall vest on February 13, 2008. The options expire on
February 12, 2011.

On February 22, 2006, the Company granted 700,000 options
exercisable at $2 per share to one employee. 175,000 options vested immediately;
10,937 options shall vest monthly thereafter over the following 48 months. The options expire on February
21, 2012.

On March 30, 2006, the Company granted 250,000 options
exercisable at $2 per share to one Director. 125,000 options vested immediately;
25,000 options  shall vest on each of June 30 and December 31 of 2006 and 2007; and
the last 25,000 options shall vest on March 30, 2008. The options expire on
March 29, 2011.

On May 5, 2006, the Company issued a total of 1,493,000 options to 9
employees and 1 consultant of the Company. The options have an exercise price of
$2 per share and they expire in 5 years. These options vest over four years per
the schedule of 25% after one year of service and monthly thereafter over the
next 36 months at the rate of 2.083%.

Between November 20 and 29, 2006, the Company issued a total of 420,000
options with exercise prices ranging from $5.10 to $6.00 per share to 5
consultants of the Company, and these options expire in 5 years.  320,000
of these options vested immediately and 100,000 options vest over four years per
the schedule of 25% after one year of service and monthly thereafter over the
next 36 months at the rate of 2.083%.

The following summary presents the incentive and
non-qualified options under the plan granted, exercised, expired and outstanding
at December 31, 2006:

`Weighted
                                               Average     Aggregate
                                               Exercise    Intrinsic
                                 Under Plan     Price        Value
                                ------------   --------   -----------
  Balance, December 31, 2005      7,060,620      $0.19    $ 6,037,346
    Granted                       3,113,000       2.45
    Lapsed                       (3,995,621)      0.84
    Exercised                           -          -
                                ------------   --------   -----------
  Balance, December 31, 2006      6,177,999      $0.91    $31,446,015
                                ============   ========   ===========`

The following summary presents the weighted average exercise
prices, number of options outstanding and exercisable, and the remaining
contractual lives of the Company's stock options at December 31, 2006:

`Options
                          Outstanding                 Options Exercisable
                           Weighted                 -----------------------
                            Average      Weighted                  Weighted
                           Remaining     Average                   Average
              Number      Contractual    Exercise      Number      Exercise 
            Outstanding      Life         Price      Exercisable    Price

  Options    6,177,999       2.26         $0.91       5,373,478     $0.68`

Prior to January1, 2006, the Company measured stock
compensation expense using the intrinsic value method of accounting in
accordance with Accounting Principles Board (APB) Opinion No. 25, "Accounting for
Stock Issued to Employees," and related interpretations (APB No. 25).

The Company adopted SFAS No. 123-R effective January 1, 2006
using the modified prospective method. Under this transition method, stock
compensation expense recognized in the annual period ended December 31, 2006 includes compensation expense for all stock-based compensation awards vested during the
annual period ended December 31, 2006, based on the
grant-date fair value estimated in accordance with the provisions of SFAS No. 123-R.

For the periods presented prior to the adoption of SFAS No.123R, pro forma information regarding net income and
earnings per share as required by SFAS No. 123R has been determined as if the Company had accounted for its employee stock
options under the original provisions of SFAS No.123. The fair value of these options was estimated using the Black-Scholes
option pricing model. For purposes of pro forma disclosure, the estimated fair value of the options is amortized to expense
over the option's vesting period. The pro forma expense to recognize during the year ended December 31, 2005 is as
follows ($ in thousands, except per share amounts):

`Net loss:
      As reported                                   $ (1,035)
      Compensation recognized under APB 25               -
      Compensation recognized under SFAS 123          (   43)
                                                    ----------
        Pro forma                                   $ (1,078)
                                                    ==========

      Basic and diluted earnings per share:
        As reported                                   $(0.06)
        Pro forma                                     $(0.06)`

Methods of estimating fair value

Under both SFAS No. 123-R and under the fair value
method of accounting under SFAS No. 123 (i.e., SFAS No. 123 Pro Forma), the fair
value of  stock options is determined using the Black-Scholes model.

Significant assumptions used to estimate fair value

The weighted-average assumptions used in estimating
the fair value of stock options granted  were as follows:

The fair value of options granted in 2006 was
estimated at grant date using a Black-Scholes option pricing model with the
following weighted average assumptions: risk free interest rate of 4.70%;
dividend yield of 0%; expected weighted average option life of 5 years; and
volatility based on an average of the volatilities of two other companies in the
same industry, since the Company's stock is not traded on any public market. The fair market value of the shares was taken as the fair market price of sale of the Company's shares to investors immediately prior to the grant of options.

Under SFAS No. 123-R, the Company's expected
volatility assumption is based on the historical volatility of the Company's
stock. The expected life assumption is primarily based on historical exercise
patterns and employee post-vesting termination behavior. The risk-free interest
rate for the expected term of the option is based on the U.S. Treasury yield
curve in effect at the time of grant.

Stock compensation expense recognized in the year ended
December 31, 2006 is based on awards expected to vest, and there were
no estimated forfeitures. SFAS No. 123-R requires forfeitures to be estimated at
the time of grant and revised in subsequent periods, if necessary, if actual
forfeitures differ from those estimates.

Warrants

In a settlement with three shareholders
in December 2006, the Company granted a three-year warrant to purchase
750,000 shares of the Company's stock at $6 per share. The non-cash expense of
the warrant, calculated by a Black-Scholes model, in the amount of $1,238,303 was recorded in the Company's financial
statements for the year ended December 31, 2006.

The fair value of warrants granted in 2006 was estimated at grant date using a Black-Scholes option pricing model with the following weighted average assumptions: risk free interest rate of 4.70%; dividend yield of 0%; expected weighted average life of 3 years; and volatility based on
an average of the volatilities of two other companies in the same industry,
since the Company's stock is not traded on any public market.

The following summary presents the warrants granted, exercised, expired and outstanding
at December 31, 2006:

`Weighted
                                             Average     Aggregate
                                             Exercise    Intrinsic
                                              Price        Value
                                ----------   --------   -----------
  Balance, December 31, 2005          -        $ -      $     -
    Granted                       750,000        6.00         -
    Exercised                         -          -            -
                                ----------   --------   -----------
  Balance, December 31, 2006      750,000      $ 6.00   $     -
                                ==========   ========   ===========`

The following summary presents the weighted average exercise
prices, number of warrants outstanding and exercisable, and the remaining
contractual lives of the Company's warrants at December 31, 2006:

`Warrants
                          Outstanding                 Options Exercisable
                           Weighted                 -----------------------
                            Average      Weighted                  Weighted
                           Remaining     Average                   Average
              Number      Contractual    Exercise      Number      Exercise 
            Outstanding      Life         Price      Exercisable    Price

  Warrants     750,000        3           $6.00        750,000      $6.00`

Note 15 - Going concern

The Company's consolidated financial statements are prepared using the generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and liquidation of liabilities in the normal course of business. However, the Company has accumulated deficit of $34,199,635 at December 31, 2006. The Company incurred a net loss of
$13,484,750 and $1,034,957 for the years ended December 31, 2006 and 2005, respectively. In view of the matters described above, recoverability of a major portion of the recorded asset amounts shown in the accompanying balance sheets is dependent upon continued operations of the Company, which in turn is dependent upon the Company's ability to raise additional capital, obtain financing and to succeed in its future operations. The financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts or amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

Management's plans and the ongoing operations of the Company are expected to require additional working capital in the next twelve months. The Company is marketing its software and communication products and is expected to generate revenues in the following year.  However, there can be no assurance that these plans could be successfully executed due to current investment climate.

Note 16 - Deemed dividend



For the acquisition of hereUare Communications, Inc. in September 2006, the
Company issued 15,985,500 shares of common stock. The purchase price was
estimated at $31,971,000 which was valuated by the Company's stock at $2 per
share which was determined to be the fair market value of the shares as
evidenced by the sale of the Company's shares to investors immediately prior to
the closing of the acquisition.

The amount of acquisition price in excess of the net equity value of hereUare on
the acquisition date, in the amount of $30,809,799 was recorded on the consolidated balance sheet as a deemed
dividend because the major shareholder and CEO of hereUare was also a major
shareholder and the CEO of the Company at the time of the acquisition.

Note 17 - Subsequent Events (Unaudited)

Within the three month period subsequent to the year ended
December 31, 2006, the Company raised $906,106 by selling 151,021 shares of common stock
to private investors.

On February 1, 2007, the Company granted 287,000 options to
five employees and one consultant. The options vest over a four year period, have an exercise price of $6 per share
and expire in five years.

On March 26, 2007, the Company changed its name to hereUare,
Inc.

---

INDEX TO EXHIBITS

(a) Exhibits Incorporated by Reference

Exhibit No.       Exhibit Description

3.1(1) Certificate of Incorporation, as amended on July 24, 2001
3.1(5) Certificate of Ownership and Merger of PeopleNet Name Change Subsidiary, Inc. with and into PeopleNet International Corporation 
3.2(1) By-laws
4.1(1) 2001 Stock Option Plan
4.2(1) 2001 Non-Employee Director Stock Option Plan
4.3(1) 2001 Stock Incentive Plan
10.1(1) Agreement between American Champion Media & American Champion Entertainment dated as of July 10, 2001
10.2(1) Agreement among ACEI, American Champion Media, ECapital Group & Anthony Chan, dated as
of June 20, 2001
10.3(1) Agreement between American Champion Media & World Channel dated as of December 27, 2000
10.4(1) Agreement between American Champion Media & Brighter Child Interactive dated as of September 30, 1999
10.5(1) Agreement between American Champion Media & Prestige Toys Corp dated as of October 13, 1999
10.6(2) Agreement - Sale of Assets between ECapital Group & PeopleNet International dated March 21, 2002
10.7(2) Agreement - Sale of Assets between PeopleNet Corporation & PeopleNet International dated March 21, 2002
10.8(3) Lease Agreement with CarrAmerica Techmart, LLC
10.9(4) Agreement and Plan of Merger with hereUare Communications, Inc., dated August 25, 2006

---

1. Filed as an exhibit to the Company's Form 10-SB/A dated as of December 3, 2001
2. Filed as an exhibit to the Company's Form 8-K dated as of March 21, 2002, and filed on April 4, 2002
3. Filed as Exhibit 10.8 to the Company's quarterly Report on Form 10-QSB filed on August 14, 2006
4. Filed as Exhibit 10.9 to the Company's Form 8-K dated as of August 25, 2006, and filed on August 31, 2006
5. Filed as Exhibit 3 to the Company's Form 8-K dated as of March 26, 2007, and filed on March 29, 2007

(b) Exhibits Filed Herewith

21.0 Subsidiaries of the Small Business Issuer
24.0 Power of Attorney - See page 17
31.1 Rule 13a-14(a) / 15d-14(a) Certification of Benedict Van, CEO
31.1 Rule 13a-14(a) / 15d-14(a) Certification of Anthony K. Chan, CFO
32.0 Section 1350 Certification

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Exhibit 21.0

Subsidiaries of the Small Business Issuer

Completo Communications Corporation, andhereUare Communications, Inc.

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Exhibit 31.1

Rule 13a-14(a) / 15d-14(a) Certification of Benedict Van, CEO

I, Benedict Van, Chief Executive Officer, of hereUare, Inc., certify that:

1. I have reviewed this annual report on Form 10-KSB of hereUare,
Inc. for the fiscal year ended December 31, 2006;

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

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

4. The small business issuer's other certifying Officers and I, are responsible for establishing
and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the small
business issuer and we have;

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

b) evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures; as of the end of the period covered by this report based on such evaluation; and

c) disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's fourth fiscal quarter that has materially affected or is reasonably like to affect, the small business issuer's internal control over financial reporting;

5. The small business issuer's other certifying officers and I have disclosed, based on our most recent evaluation, to the small business issuer's auditors and the audit committee of small business issuer's board of directors (or persons performing the equivalent function);

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which could adversely affect the small business issuer's ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.



Date: April 12, 2007

/s/ Benedict Van
Benedict Van
Chief Executive Officer

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Exhibit 31.1

Rule 13a-14(a) / 15d-14(a) Certification of Anthony K. Chan, CFO

I, Anthony K. Chan, Chief Financial Officer, of hereUare, Inc., certify that:

1. I have reviewed this annual report on Form 10-KSB of hereUare,
Inc. for this fiscal year ended December 31, 2005;

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

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

4. The small business issuer's other certifying Officers and I, are responsible for establishing and
maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the small business
issuer and we have;

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

b) evaluated the effectiveness of the small business issuer's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures; as of the end of the period covered by this report based on such evaluation; and

c) disclosed in this report any change in the small business issuer's internal control over financial reporting that occurred during the small business issuer's fourth fiscal quarter that has materially affected or is reasonably like to affect, the small business issuer's internal control over financial reporting;

5. The small business issuer's other certifying officers and I have disclosed, based on our most recent evaluation, to the small business issuer's auditors and the audit committee of small business issuer's board of directors (or persons performing the equivalent function);

a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which could adversely affect the small business issuer's ability to record, process, summarize and report financial information; and

b) any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer's internal control over financial reporting.



Date: April 12, 2007

/s/ Anthony K. Chan
Anthony K. Chan
Chief Financial Officer

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Exhibit 32.0

SECTION 1350 CERTIFICATIONS

We, Benedict Van, Chief Executive Officer and Anthony K. Chan, Chief Financial Officer, of
hereUare, Inc. (the "Company"), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of
2002, 18 U.S.C. Section 1350, that to the best of our knowledge:

1. the Annual Report on Form 10-KSB of the Company for the year ended
December 31, 2006 (the "Report") fully complies with the requirements of Section 13
(a) or 15 (d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d));
and

2. the information contained in the report fairly presents, in all material
respects, the financial condition and results of operations of the Company.



Date: April 12, 2007

/s/ Benedict Van
Benedict Van
Chief Executive Officer
and/s/ Anthony K. Chan
Anthony K. Chan
Chief Financial Officer

The material contained in Exhibit 32.0 is not deemed "filed" with the SEC and is not to be incorporated
by reference into any filing of the Company under the Securities Act of 1933 or the Securities Exchange Act of 1934,
whether made before or after the date hereof and irrespective of any general incorporation language contained in such filing.