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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, 2007

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 000-33033

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.     [  ]

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: $35,996

Aggregate market value of common stock held by
non-affiliates at March 31, 2008:  $152,589,195 (see Note A)

Number of shares of common stock outstanding at March 31, 2008: 34,344,975

DOCUMENTS INCORPORATED BY REFERENCE:   None

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

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Note A:
Based upon the $9.00 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: 49
Exhibit Index is on Page 46

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HEREUARE,  INC.2007 ANNUAL REPORT ON FORM 10-KSBINDEX



|Part I.        |                                                                                                                                             | Page
|-------------- | ------------------------------------------------------------------------------------------------------------------------------------------- | ----
|Item 1.        | Description of Business                                                                                                                     | 3   
|Item 2.        | Description of Property                                                                                                                     | 18  
|Item 3.        | Legal Proceedings                                                                                                                           | 18  
|Item 4.        | Submission of Matters to a Vote of Security Holders                                                                                         | 18  
|Part II.       |                                                                                                                                             |     
|Item 5.        | Market for the Registrant's Common Equity. Related Stockholder
      Matters and Small Business Issuer Purchases of Equity Securities       | 18  
|Item 6.        | Management's Discussion and Analysis or Plan of Operation                                                                                   | 19  
|Item 7.        | Financial Statements                                                                                                                        | 22  
|Item 8.        | Changes in and Disagreements with Accountants on Accounting and
      Financial Disclosures                                                 | 22  
|Item 8A.       | Control and Procedures                                                                                                                      | 22  
|Item 8B.       | Other Information                                                                                                                           | 23  
|Part III.      |                                                                                                                                             |     
|Item 9.        | Directors, Executive Officers, Promoters, Control Persons and Corporate
      Governance; Compliance with Section 16(a) of the Exchange Act | 23  
|Item 10.       | Executive Compensation                                                                                                                      | 25  
|Item 11.       | Security Ownership of Certain Beneficial Owners and Management and
      Related Stockholder Matters                                        | 27  
|Item 12.       | Certain Relationships and Related Transactions and Director
      Independence                                                              | 28  
|Item 13.       | Exhibits                                                                                                                                    | 29  
|Item 14.       | Principal Accountant Fees and Services                                                                                                      | 29  
|Signatures     |                                                                                                                                             | 29  
|Exhibits Index |                                                                                                                                             | 46  
|Certifications |                                                                                                                                             | 47  



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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
"Description of Business--Risk Factors Affecting Future Performance" 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, 2006, as amended by Form 8-K/A filed on
December 8, 2006. On March 26, 2007, the Company changed its name from PeopleNet
International Corporation to hereUare, Inc.

Discontinued Business

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.

Business Overview

hereUare, Inc. ("hereUare," "HUA," or "the Company") is a diversified
technology company developing Internet software and telecom solutions. The
Company's key products deliver a simple, yet powerful platform, which can be
uniquely tailored to different Internet needs or telecom styles.  The Company's products provide a unique online platform for users,
from individuals, through small & medium businesses to larger corporate
enterprises, with a personalized, all-in-one web-based solution that aggregates
any user's needs, from any location, with the use of any Internet device. The
innovative hereUare platform and accompanying solutions are a result of seven
years of comprehensive research and development packaged into a portfolio of
products, some of which utilize pioneering and involved patent pending
technologies that may drastically enhance a user's Internet experience.

Uniquely different from many Internet companies, hereUare approaches
the online market and wireless communications with a holistic view that focuses
on daily usage patterns.  hereUare's integrated product suite consists of
five primary applications as described below, and serves five primary Internet
revenue segments: a) Consumers, b) Retailers, c) Advertisers,  d) Small &
Medium Businesses ("SMBs"), and e) Larger Enterprises.

hereUare applications:

Every HUA application is interconnected through the interchangeable
functionalities of each application. For example, a user can click a phone
number from a website generated from our OneEngine search to order a
pizza through our OneVoice VoIP or conversely click a phone number from a
user's OneMessagecontact list to place a call. Both functions are
enabled without the requirement for a user to insert user data or information. 
This level of seamlessness is designed to increase user efficiency, while
greatly enhancing the overall ease-of-use for a user.  hereUare believes there
is a direct correlation between product integration and the success of a
business that relies on the Internet as its point of sale.

Background

In 1999, hereUare Communications, Inc., a California corporation,
was one of the first wireless Internet service provider (WISP) aggregators to
attempt to provide wireless hotspot solutions across the United States.  In
2002, eCapital Group formed hereUare Communications, Inc., a Delaware
corporation, and purchased all assets and goodwill from hereUare Communications,
Inc., the California corporation.  Under hereUare's new leadership, Benedict
Van, the Company amended its business model to include technologies that
competitively position hereUare Communications in the thriving Internet and
wireless communications marketplace.

In September 2006, PeopleNet International Corporation acquired
hereUare Communications, with hereUare Communications becoming an operating
entity of PeopleNet International Corporation.  PeopleNet International
Corporation is a reporting company in compliance with all the rules and
regulations of the U.S. Securities & Exchange Commission (SEC).  In March 2007,
People International Corporation changed its name to hereUare, Inc.

Our Mission

hereUare is committed to transforming communication between people,
markets and communities who use them. hereUare is dedicated to designing
user-friendly applications and collaborative interactive technology that
includes our unique search, messaging and voice
applications to  facilitate mobility for online user
convergence across the globe.

The hereUare team understands the broad global and local
connectivity that is required to conduct business competitively and effectively;
as such we pride ourselves on providing one seamless, easy-to-use platform that
limitlessly expands the communication reach of enterprises, businesses and
individuals in the 21st century.

Through the intuitive integration of various technology channels,
hereUare places an all-in-one communication solution at the fingertips of its
users. It is our mission to build useful online applications that collaborate
with any device, anywhere, that meet and exceed the far-reaching expectations of
our diverse users.

HUA Applications and Solutions

As a daily Web destination, hereUare intends to offer a Product Suite of
four key revenue producing applications plus a social network application. 
Providing a valuable sense of the style that is illustrated in the design of our
applications, our desire is to present a warm and welcoming presence for any
community on the Internet today. It is our intention to continue developing
unique applications that provide daily relevance to any user, anytime whether it
applies to our search, VoIP, or messaging technology. The direction of the
Company over the past seven years is to place a premium on quick, easy and
efficient online tools that enhance the online experience for any user.

OneEngine Search

hereUare OneEngine search solution stems from two primary
design philosophies: 1) a "green" search engine that is environmental
responsible and 2) a search style that's easily navigated regardless of the
user's experience level.  This solution offers comprehensive and relevant search
results accessing over 10 billion indexed pages.  The required software that
powers OneEngine search uses less hardware than typically used by our
competitors to search 10 billion indexed pages; hence, the "green" search
solution which uses less energy. This equates to a lower capital requirement and
operating cost; one of the product's key competitive advantages. In addition to
the "green" search engine, hereUare offers a search style that categorizes the
keyword search to allow further refinement without requiring the user to use a
sophisticated Boolean search approach.

OneEngine Search features:

OneEngine search engine is supported by an advertisement server
which is designed to provide the Company with a powerful revenue-generating
source. With OneEngine acting as the backbone of the HUA product suite, the
Company is poised to offer effective methods for advertisers to narrowly target
their online marketing campaigns across hereUare's product suite and
applications.

OneVoice VoIP

hereUare OneVoice Voice over Internet Protocol (VoIP) telephony
solution, offers a peer-to-peer (P2P) connection, delivering high quality audio
while requiring minimal bandwidth.  The service works over almost any Internet
connection, even at dial-up access speeds.  Our OneVoice VoIP service is managed
through our HUA engineered 'Softphone' a multi-media user interface that works
in association with our VoIP technology.  It serves as a dialing pad for
initiating calls directly from a PC to any receiving device over the Internet. The Softphone applet is downloaded from
the hereUare website as a stand-alone onscreen
phone.

For versatility, the Softphone supports an external phone or headset
connected to a computer for dialing and receiving calls.  The Softphone is
designed to be a multi-media communication portal, which when expanded
incorporates and connects to HUA applications - OneEngine, OneMessage and
OneUniverse.

hereUare does not intend to charge customers
monthly fees or connection charges for OneVoice VoIP, or to require a user
contract for VoIP service.  Calls made between two HUA OneVoice connections are
free from anywhere in the world. For calls made outside of the hereUare
community, hereUare will offer one of the most competitive international rates
on the market today.

OneVoice VoIP Features

The company holds an International FCC 214 license and is telecom compliant for all tariff requirements in the
United States.

Click-to-Call and Pay-per-Call Market Opportunity

Although the Click-to-Call (CTC) is a feature
built into our OneVoice solution, the application is powerful enough to stand on
its own as a unique online downloadable browser tool.  hereUare's CTC takes
consumers directly to advertisers and retailers in one step by clicking on the
displayed phone number resulting from a search or an advertisement.  The
hereUare patent-pending CTC technology immediately connects users to their
selected destination from any web page. This feature takes targeted marketing
campaigns to the next level by providing a convenient way for impulse buyers and
advertisers to achieve immediate satisfaction.

The CTC feature allows hereUare to be innovative
with its business proposal to advertisers by allowing a "pay-per-call" model. 
According to this model, the advertisers pay only when a customer initiates a
call.  The billing will be reversed so that the caller does not pay; rather the
advertiser subsidizes the cost of the call. Businesses will greatly benefit from
this model as it minimizes the investment risk for their advertisement dollars
and provides a powerful way to capture their audience. 
Consumers benefit from this convenience, while at
the same time their privacy is protected, because their home numbers and personal
information are shielded.  Businesses are able to self-manage the
tools such that they do their own "auditing" of the efficacy of the pay-per-call
advertising; thus, they improve the return on investment of their online marketing campaigns. The
hereUare CTC model eliminates the click fraud experienced by many advertisers. 
By including "pay-per-call" in its service offerings, hereUare expects
to be able to
increase VoIP and advertising revenue, plus increase market shares through push
and pull marketing.

Studies by the Kelsey Group indicate
that the response rate for telephone-based ads is 8%, compared with 3% for
Pay-per-Click ads.  While estimates are still unproven due to the infancy of the
market, revenue from pay-per-call ads could jump from $0 in 2005 to $4 billionby 2009.  hereUare's CTC feature has the potential to change how we
interconnect on the Internet and will be properly positioned to capture a
significant share of this new emerging market.

OneClassified Classified Advertising

hereUare OneClassified, allows consumers and businesses to buy,
sell, advertise, and connect to the discussion forums based on topics like
business, relationships, entertainment, and shopping. hereUare OneClassified
provides advertisers with simple uploading for their listings through the use of
pictures and step-by-step descriptions that allow users to instantly start utilizing the services.

OneClassified features:

OneMessage e-Messaging & Groupware

hereUare OneMessage offers a powerful and simple solution for
messaging with collaborative applications for the SMB market and email hosting
business.  The application is a web-based design which provides SMBs with a
collaborative tool to support multiple office locations in a shared-management
environment.  The web-based messaging solution reduces IT overhead for
businesses.

OneMessage provides a user-friendly graphical web-based interface with instant access to
information. Email messages, contacts, appointments and tasks are clearly
arranged and easy to manage from almost any location, anywhere. Users are provided with a choice to assign tasks,
appointments and information as private and/or public for others to view.

In addition to providing publicly accessible basic features free of
charge that are comparable to the largest email systems available from market
leaders such as Yahoo and Google, our OneMessage system will also provide paid
solutions for more demanding users and SMBs such as private domain names, file
sharing, and calendar sharing.

Market Opportunity

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.  By 2005, nearly 210 million U.S. Internet users
were online, ranking the U.S. as the country with the highest penetration rate
in the world based on the number of Internet users per 1,000 people.
With high adoption rates early on in the US and developed regions, rate of
Internet use is now  reaching  a mature level of growth for the technology,
while worldwide growth rates continue to surge at impressive rates that continue
to present Internet business opportunities worldwide. Outside the U.S. and
developed regions, the Internet is still relatively a new frontier technology
platform that new users are discovering everyday. The projection of worldwide
Internet growth by eTForecasts indicates that the Asia Pacific Region is expected to significantly lead worldwide
Internet expansion and will reach nearly 800 million Asia Pacific Internet users through 2010.

In addition, wide adoption for wireless web devices such as
Blackberry-like devices continues to drive the trend, thereby increasing daily
Internet traffic. In 1999, 1.7% of web users worldwide accessed the web with a
wireless device, and by early 2006, the worldwide wireless web use increased to
21%.  Today, as wireless access extends to greater geographical areas and with
decreasing hardware costs, the trend will continue to accelerate web usage, thus
forever changing business models, advertising campaigns, and how people receive
information. The trend will be especially acute in developing countries that lack the infrastructure to
accommodate Internet access via landline connections where inexpensive handheld
devices are now readily available and are reaching into these new Internet
communities and marketplaces.  Key factors that drive Internet growth will be
continued price reductions in network  hardware and proliferation of Internet
cafes, Internet entertainment content, e-Commerce platforms in developing
countries, and Web content for wireless devices.

With rapidly expanding web content, the Internet has emerged as the
first truly global market- place, one which provides a multitude of goods and
services offered by a multitude of international participants. The growth of
online commerce self-perpetuates further Internet usage that drives the impetus
for future changes to the Internet we know today. For example, the emergence
since 2005 of Social Networking, video sharing sites, and blogging.  The rapid
proliferation of web sites, content, and specialized businesses in the Internet
marketplace will continuously drive the growth of new Internet users and how we
use the Internet to conduct business. This persistent growth will necessitate
advanced Internet tools, technologies, and services from an even wider range of
Internet service aggregators, although the primary online business model has not
necessarily changed over the last ten years, as revenues continue to be derived
primarily from general advertising-based campaigns and targeted ads based upon
user search criteria.

Although search plays a vital role in the success
of an Internet portal by generating 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.  As competition for users increases, success will
depend on the ability to create user loyalty and to retain ongoing usage of a
particular website or a suite of products, such that the overall user experience
is enhanced as well as user efficiency increased (Forbes Technology, May 2006).

Total Available Market (TAM) for HUA

The hereUare business model is comprised of four key robust and
existing market applications:  Search, Classifieds, Messaging (including
groupware), and VoIP.  Each of these applications serves a specific market
segment and each has a specific model of usage behavior and market
characteristics.  hereUare has committed its technology to becoming a market
leader in each segment.

The total available market (TAM) for our market applications indicate the growth
potential of hereUare and is closely correlated to the overall growth of the
existing marketplace. With expected growth rates for the our
targeted applications averaging 15.5% annualized  in the U.S. over the next 4 years,
hereUare is striving to accomplish rapid revenue growth and user acceptance for
each of the Company's applications.

HUA Applications and Their Market Cycle

Based on the Internet advertising model, Internet Search is the most recognized
revenue generating application.  Search revenue is primarily fueled by
targeted ads and revenue from "pay for Click".  Search is expected to
continue double digit growth through 2010.

The online classified market continues to grow as users rapidly migrate to the
Internet as their source for news, research, and commerce. As the number of
consumers that visit the Internet increases, advertisers have followed suit,
thus shifting a greater proportion of their ad dollars to the Internet from the
older forms of media. It is estimated that newspaper classified revenues have
fallen by as much as 40% recently in certain categories.

Messaging, also referred to as Groupware or
Collaborative software, has been widely accepted by Internet users and is now
expanding to serve SMBs.  As virtual offices are
established in dispersed locations to address a global work environment, the
acceptance of a centralized web-based office tool is expected to create a new
category of users for an old application: email. SMBs, too small to create and
maintain their own communication networks, will give new life to an application
that the individual user now expects for free.

VoIP technology has advanced drastically in recent years as voice
quality and call stability has improved. This trend will lead to greater market
opportunities as individual consumers and businesses accept the technology as a
low cost option to traditional telecom solutions.   This application is in the
initial stages of growth and is expected to continue to expand in worldwide acceptance as VoIP technology is more readily understood and accepted

Competitive Landscape

The Internet, as an industry, is
relatively new and still evolving. hereUare's technologically-integrated Product
Suite offers a one-stop destination serving all of a user's Internet needs. This
places hereUare in a unique position to offer a comprehensive platform with a
product suite that contains the four key revenue generating applications on the
Internet. The majority of Internet companies have been looking to acquisitions
to expand business instead of in-house development for Internet application
research which has stagnated in recent years. This presents Internet software
firms an opportunity to lunch new online platforms. Conversely, at the opposite
end of the spectrum, the majority of Internet companies today are niche players
offering blogs, content feeds, local search, vertical searches, videos, and
social networks.  These niche players are not in the same category with hereUare
as their business models focus on a single application. The management of
hereUare believes that its current mix of competitors include companies that
have a broad-based online strategy using their landing page as a daily
destination as the basis of introducing affiliated offerings or online services.

The competitive landscape is best understood by grouping companies
based on revenue, traffic and overall technology in the marketplace.  The Tier 1
companies are defined as the leaders in these areas.  The Tier 2 companies are
niche players that provide a well-designed landing page using open source
technologies or Application Protocol Interfaces (APIs) provided by a Tier 1
company.  The gap between the two tiers from a revenue and technology
perspective is wide.  An analysis of Strengths, Weaknesses, Opportunities, and
Threats (SWOT) for each tier indicates that the key difference between the tiers
is technology ownership for Internet traffic and the ability to monetize or
retain traffic.

Although Tier 2 companies are growing quickly with high traffic
adoption rates among users, these users are typically eager to try the next new
technology and the growth for these companies may be deceiving. As a result,
Tier 2 companies quickly attract a limited user base of early adopters as word
spreads about "the new application that's out there" perhaps best described as
the "cool factor" and acceptance by the general population usually does not
occur. Tier 2 players often don't have control over the direction of their
product or site development to meet user evolving demand and market trends. This
in turn makes it difficult for these companies to ensure proper execution of
their business plans and they are often open to challenge by open sourced community-based
product development.

hereUare with its comprehensive applications
which support the company in a Tier 1 business model, may enable the Company to
move into the high revenue segment in the future.

Barriers to Entry

Barriers to entry for Internet service and search providers are
primarily the ability to create site traffic or "eyeballs" which are typically
created through viral marketing and advertisements on the web. Equally important
as a barrier to market entry is the need for capital or advertising revenue to
fund growth or new technology which is required or even demanded by users.
Retention rates of "eyeballs" are dependent on customer satisfaction with the
aesthetics and the ease-of-use to achieve a successful user visit to the site. 
Another obstacle is the user's previous experience with existing applications
and how sites shape user perception of how it should look, feel, and work,
especially among the general population of Internet users. As a result, these
users are less likely to be willing or able to change as their technical skills
are typically not as high as the "early adapters".  The general population of
Internet users expects a minor learning curve and simplicity is the key factor
to a positive experience; high customer satisfaction will ultimately lead to a
return visit.

The Internet portal is a consumer product and its
brand awareness is essential to attracting site traffic. Driving sufficient
traffic to a site is required in order to build up brand recognition and repeat
traffic so that the site gains traction. This can be a major hurdle, which
requires capital and time.

HUA Marketing Plan

Our marketing strategy approaches the market from three different
perspectives, with the primary goal of driving adoption of hereUare's
applications. Our first approach focuses on building brand awareness primarily
through online advertising and eyeball acquisition of carefully placed and
strategically located ads and links that draw attention to the hereUare Search
page that is the Company's landing page. The HUA marketing team has identified
multiple sites as co-branding partners which will host HUA search and links. As
a central destination web page, the HUA landing page is designed to lead users
into the company's other applications.

The second prong for marketing HUA, is an active public relations
campaign where the company and its applications are promoted through a viral
marketing approach that attract interested users through word of month. Active
viral marketing or viral advertising refers to marketing techniques that use
pre-existing social networks to produce or increase in brand awareness, through
a self-replicating or viral process using social connections and word-of-mouth
or online Internet dialogue to enhance the power of online networking. Viral
marketing is a unique online phenomenon that facilitates and encourages people
to pass along fresh ideas, concepts and products, and therefore market a
message voluntarily. Viral promotions may take the form of video clips,
interactive games, images, or emails and have proven very effective in recent
years, as proven by the success of YouTube, MySpace and Facebook. It is widely
claimed that a satisfied customer tells an average of three people about a
product or service he/she likes, and eleven people about a product or service
which he/she did not like.  Viral marketing is based on this natural human
behavior, and has been very useful to the online community in promoting ideas,
concepts and products. NewYorkBusiness.com in a May 30, 2007 article estimated
that companies will spend $900 million in the United States and $335 million
overseas on advertising on social networks this year, and by 2011 worldwide ad
spending is forecast to rise to $3.6 billion.

hereUare anticipates that such online Internet dialogue among online communities will in
essence create an infectious need among early adopters to use hereUare as daily
destination, which will in-turn will drive advertising rates on HUA related
sites and ultimately drive acceptance by the general population of Internet
users for HUA applications.

Our third approach for marking centers around the establishment of
relationships with large communities for positioning HUA as the default user
gateway or portal to the Internet.  This approach has been key to our
go-to-market strategy to date, as described in the section below, and has
enabled HUA to identify large communities of Internet users among unique
demographic groups in the USA and in Asia.  This approach focuses on channel
development with value-added resellers (VARs) and distributors who will offer
our OneMessage messaging product line to SMBs and
enterprises.

Market Strategy

Search, Messaging, and VoIP are three of the most highly prized tools
used on the Internet today. Total search revenue is expected to reach $20
billion by
2010. VoIP revenue is predicted to grow at an average annual rate of 31% over the next
five years. The revenue growth potential of HUA's Search, Messaging, and VoIP applications
create the basis of our initial market entry efforts.  Our focus is to drive
adoption rate for our enterprise solution by offering VoIP and messaging to
large corporations, which in turn, will increase our Search traffic and vice
versa.  These applications are the backbone of our online product revenue
growth.

Advertisements based on search requests are expected to continue as
the leading revenue generator in the Internet Search Industry. According
to a report issued in June 2007 by Emily Riley, an analyst with Jupiter
Research, online advertising is expected to reach about $19 billion this year
and is anticipated to reach more than $35 billion by 2012 in the US. The traffic surrounding our HUA OneEngine search
application is expected to have a viral impact on our other online products,
such as classifieds and Click-to-Call. The Company anticipates that our on-line
applications including search and message will generate 81% of hereUare's
revenue in 2008. Supporting the Company's revenue model for search is revenue
derived from our VoIP technology that offers two identified revenue paths,
retail voice connection and Click-to-Call advertiser listings.

hereUare plans to jumpstart the viral marketing effect with
identified vertical market segments and partners. We are attempting to
established relationships with community groups in the U.S., Vietnam and China.
These relationships, if established, can give us access to user gateways of a
large number of users that play an essential role in the success of our commercial launch for OneEngine
search, OneVoice VoIP, and OneMessage messaging applications.  Our goal is
to establish these relationships on the basis of hereUare being the default user
gateway.  Our marketing programs are directed toward a vertical focus 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; this can ensure a network effect that stems from self-proliferating
community behavior.

These relationships are important to our initial market plan.  In
parallel to our relationships international, hereUare views each application
that is promoted as an individual product with its own revenue potential.  The
marketing campaigns are tailored accordingly to the behavior of each targeted
market segment.  For example, the OneMessage product line is targeting SMBs
and consumers; thus, it requires 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 network media and
community sponsorships.  Offline initiatives include radio, print, and
event sponsorships.  Also, we plan a schedule of press conferences
and press releases to promote the brand name and keep it fresh in the minds of
web users, industry analysts, commentators and news organizations.

Sales-oriented marketing is intended to drive the 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 advertisements, 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.  Our
direct sales team will establish channels with value-added resellers (VARs) and
distributors to expand and actively reach the enterprise market with our
messaging and VoIP solutions.

International Strategy

Uniquely positioned, hereUare's executive team has established
strong working relationships with the relevant branches of the governments of
Vietnam and  China.  These relationships are critical to entering the Asia market, where
economies are projected to continue double digit growth well into the next
decade.  These relationships are a key competitive advantage for hereUare over
competitors who face high barriers of entry in these markets.

Countrywide, Vietnam and China have historically had poor telecom
infrastructure. The development and establishment of VoIP as a communication
alternative will meet the immediate needs of many users that cannot afford
traditional telecom infrastructure.  The VoIP solution provides voice
connectivity without the extra cost of data infrastructure, while it provides
greater access to telecom products without a high termination fee.  With a
communication infrastructure that is still under developed in these countries,
VoIP is an easy, cost-efficient solution. In these countries, government
approval is vital and necessary for rolling out and distributing our VoIP
product solution.

The hereUare OneMessage e-messaging application is another
cost-effective solution to the communication problems that continue to exist in
these countries.  The hereUare messaging system includes an email hosting
solution that scales from small business to governmental level usage.  This
allows the government the flexibility to support and control the development of
communication tools in regions that lack investment capital.

Branding Strategy

The Internet is a consumer market in which brand recognition is
essential to any viral marketing campaign for the attraction and retention of
traffic.  Therefore, hereUare has carefully studied and selected its brand and
domain name. Extensive focus group studies indicated that the hereUare name suggests and
promotes a central Internet destination that serves all the needs of the user. 
As a brand, the hereUare message delivers the company's mission as a one-stop
destination, where any device can be used, any where, any time. "hereUare" is
easily pronounced and understood by non-English speaking users, which enhances
its acceptance as a global brand. Generally speaking, the Internet domain name
has become a valuable commodity. As a result, it has become a serious challenge
to find a name that will resonate with consumers, while serving as a company's
mission. hereUare has overcome this challenge successfully, with its easily
understood name and products registered and trademarked.

Online the company plans to promote its brand through the use of
sponsored links and vertical event sponsorships.  As described in the Market
Entry section above, sponsorship of events in large communities similar to the
Christian Life Center 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 hereUaretagline.

Intellectual Property

We rely on a combination
of patent, trademark, copyright, and trade secret laws in the U.S. and other
jurisdictions as well as confidentiality procedures and contractual provisions
to protect our proprietary technology and our brand. We also enter into
confidentiality and invention assignment agreements with our employees and
consultants and confidentiality agreements with other third parties, and we
rigorously control access to our proprietary technology.  We license our search
technology on a non-exclusive royalty-bearing basis; our license expires, unless
renewed by agreement with the licensor, in October 2016. Trademarks which we own
or license include "hereUare".

The Company has been granted two US patents:

The Company has not included the use of the technology covered by these two patents in its current plans.

We have U.S. patents pending covering aspects of our OneSearch
and OneVoice applications, which we cannot be sure will be granted or if they
are granted will be valid and enforceable and of a scope to cover aspects of
commercial importance. We cannot predict whether the failure to obtain these
patents or the invalidation of any patents we obtain would result in the
introduction of competitive products which would adversely affect our future
revenues. We presently intend to pursue any infringement of patents which issue
from these applications either by litigation, arbitration, or negotiation.
However, there can be no assurance that any of our patents will be sufficiently
broad in scope to afford protection from products with comparable
characteristics that may be sold by competitors in the future. There also can be
no assurance that the validity of any patents actually granted will not be
challenged.

Government Regulation

Once we begin to offer our services, we will be subject to a number
of foreign and domestic laws and regulations that affect companies conducting
business on the Internet.  In addition, laws and regulations relating to user
privacy, freedom of expression, content (including gambling and underage sexual
material), advertising, information security and intellectual property rights
are being debated and considered for adoption by many countries throughout the
world.  In the U.S., laws relating to the liability of providers of online
services for activities of their users and other third parties are currently
being tested by a number of claims, which include actions for defamation, libel,
invasion of privacy and other data protection claims, tort, unlawful activity,
copyright or trademark infringement and other theories based on the nature and
content of the materials searched, the ads posted or the content generated by
users. Certain foreign jurisdictions are also testing the liability of providers
of online services for activities of their users and other third parties. Any
court ruling that imposes liability on providers of online services for
activities of their users and other third parties could adversely impact our
business prospects. In addition, because our services may become accessible
worldwide, certain foreign jurisdictions may claim that we are required to
comply with their laws, even where we have no local entity, employees or
infrastructure.

Our business could be adversely affected by
significant changes in government policies and regulations controlling the
industry in which we operate.

The revenues of our business may be
substantially derived from contracts with international governments and foreign
companies, and that the growth of our business may depend on our procurement of
government contracts. Accordingly, changes in domestic and foreign government
policies or international regulatory constraints could directly affect the
financial performance of our business.  Among the factors that could adversely
affect our business are:

These and other factors could cause governments
and governmental agencies to reduce their purchases under existing contracts, to
exercise their rights to terminate contracts at-will or to abstain from
exercising options to renew contracts, any of which could have a material
adverse effect on the business, financial condition and results of operations of
our business.



Employees

As of March 31, 2008, we have twenty full-time and four part-time employees.



Risk Factors Affecting Future Performance

We lack revenue history and currently do not have a proven business model to
generate revenue.   Absent revenue, our business will fail.

In the past years, we have concentrated on developing our products and have not
generated significant revenues.  We have only recently begun testing our
products and services on a limited basis and have generated minimal revenues. 
There can be no assurance that as we roll-out our products, we will be able to
generate material revenues from them.  Many of our services, such as search and
VoIP, have been historically offered free of charge to users, with companies
depending upon advertising to generate revenues.  There can be no assurance that
we will be able to persuade advertisers that it is cost effective for them to
pay us for advertising their products and services.  Even if we are successful
initially in generating advertising revenue, there can be no assurance that we
will be successful long-term.

We have never been and may never become profitable. We will need to be profitable
in order to succeed.

We have never been profitable. In fact, during both fiscal 2007
and 2006, we were not even able to operate
with a gross profit. There can be no assurance that we will ever generate a gross profit, much less and operating
profit. Even if we achieve profitability, there can be no assurance that we will be able to sustain it.

We expect to incur operating losses for the foreseeable future.

Some of our products are still in the developmental stage, and
prior to completing the commercialization of our products, we anticipate that we
may incur operating expenses without realizing substantial revenues.  We
therefore expect to incur losses into the foreseeable future.

If we are unable to manage our projected
growth, our prospects may be limited and our potential for profitability may be
adversely affected.

We intend to expand our sales and marketing, and
research and development programs.  Rapid expansion may strain our managerial,
financial and other resources.  If we are unable to manage our projected growth,
our business, operating results and financial condition could be adversely
affected.  Our systems, procedures, controls and management resources also may
not be adequate to support our future operations.  We will need to continually
improve our operational, financial and other internal systems to manage our
growth effectively, and any failure to do so may lead to inefficiencies and
redundancies and result in reduced prospects for our company.

We are materially dependent on acceptance of
our products in development by our target markets.  If our products, when
commercially ready, are not accepted, our revenues will be adversely affected
and we may not be able to generate revenue from these markets.

The target markets for our technologies and products in
development will principally include consumers, retailers, advertisers, small to medium businesses,
and enterprises. If our products in development are not widely
accepted by these markets, we may not be able to generate sales of our products
into these markets.  Technology for the Internet evolve quickly as compared to
other industries, if technology evolves beyond the capabilities of our products,
the market may not accept our products.

Our dependence on our research and
development team for key components of our platforms and delivery systems could
delay the launch of our products and reduce acceptance rates of our products.

We depend on our research and development
department for the delivery of components integral to our systems.  Our reliance
on these teams creates risks related to our potential inability to launch our
systems.  Specifically, we depend or may in the future depend on these teams to
write software code to power our systems.  Any interruption of our technology
development could significantly delay the introduction or update our products
and have a material adverse effect on our revenues, profitability and financial
condition.

Defects in our systems could reduce demand
for our products and result in delays in market acceptance and injury to our
reputation.

Complex software systems and technologies used
in our products may contain undetected defects that are subsequently discovered
at any point in the lifecycle of our products.  Defects in our products may
result in a loss of sales, delay in market acceptance, loss of opportunity or
other economic loss to our customers, and injury to our reputation and increased
costs to remedy interruptions in our service or products.

We depend on our technology and products
which incorporate our technology.  The loss of access to this technology as a
result of intellectual property claims or otherwise would terminate or delay the
further development of our products, injure our reputation or otherwise impair
our viability as a company.

We rely on technologies that we acquired or
developed through our proprietary research and development efforts.  The loss of
these technologies for any reason would seriously impair our business and future
viability.  If we are required to enter into license agreements with third
parties for replacement technologies, and assuming such licenses are even
available to us, we could be subject to high royalty payments.  In addition, any
defects in our technology or any technology we may license in the future could
prevent the implementation or impair the functionality of our products, delay
new product introductions or injure our reputation and results of operations.

We may be unable to adapt or upgrade our
technologies and products as the markets in which we compete evolve, which would
leave us at a significant competitive disadvantage.

The Internet and online marketplace is rapidly
evolving as new technologies are developed to create unforeseen needs.  We may
be unable to adapt or upgrade our technologies, or otherwise invent and develop
new technologies, to meet theses competitive technologies. If we cannot develop
new more sophisticated or advanced technologies and systems, or interface with
newly developed technologies from our competitors our business could suffer
serious harm to its reputation and could negatively impact our results of
operations.

We have few capital resources and will be dependent upon future financing to
generate the cash necessary to operate our business. Should we fail to raise
such financing, we may be forced to cease operations.

We currently have very little cash on hand. Historically, we relied on funds
raised from private sale of our common stock to accredited investors and were
only able to support our small operation and development of our technology.
 Although we are currently seeking substantial financing to launch our products
and services, there is no assurance that we will be successful in raising the
funds necessary on favorable terms.  Management remains doubtful whether enough revenues can be generated
in the near term to sustain our operations and intends to seek substantial funding 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.  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.

We will need to raise additional capital, which will be dilutive to our current shareholders.

We will need to raise additional funds in order to advance our business plan, and to carry out a
full scale commercialization of our products. To the extent we need to raise additional capital, we may do so in the near future, if conditions
in the markets are favorable.  If and when we achieve initial market acceptance
our technologies and products, we may desire to attempt to accelerate our growth
to take advantage of increasing demand and raise additional capital at that time
as well. Any additional capital could take the form of equity or debt financing.
In addition, any future equity financing will be dilutive to shareholders.

We face significant competition from large-scale Internet content, product and service
aggregators, principally Google, Microsoft and AOL.

We face significant competition from companies, principally Google, Microsoft
and AOL, that have aggregated a variety of Internet products, services and
content in a manner similar to ours. These companies are in dominant positions
in the Internet service industry and have well established relationships with
online advertisers. Their strength may adversely affect our ability to execute
our business plan. Their services directly compete with ours, including Internet
search, local search and directories,
consumer e-mail service, VoIP, and
advertising solutions. These large-scale competitors and possible additional
entrants  have significantly greater operational, strategic, financial, personnel or other
resources than we do, as well as greater brand recognition overall. These
competitors are expected to be continuously more effective than us in targeting
services and advertisements to the specific preferences of their users thereby
giving them a competitive advantage.

We also
face competition from other Internet service companies, including Internet
access providers, device manufacturers offering online services and destination
websites.

Our users must access our services through Internet access providers,
including wireless providers and providers of cable and broadband Internet
access. To the extent that an access provider or device manufacturer offers
online services competitive with ours, the user may elect to use the
services or properties of that access provider or manufacturer. In addition, the
access provider or manufacturer may make it difficult to access our services by
not listing them in the access provider's or manufacturer's own directory. Such access providers and
manufacturers may prove better able to target services and advertisements to the
preferences of their users.

We also compete for customers, users and advertisers with many other
providers of online services, including destination websites and social media
and networking sites. Some of these competitors may have more expertise in a
particular segment of the market, and within such segment, have longer operating
histories, larger advertiser or user bases, and more brand recognition or
technological features than we offer.

In the future, competitors may acquire additional competitive
offerings, and if we are unable to complete strategic acquisitions or
investments, our business could be adversely affected. Further, competitors
may consolidate with each other to become more competitive, and new competitors
may enter the market. If our competitors are more successful than we are in
developing compelling products or attracting and retaining users, advertisers or
customers, then we may have difficulty in executing our business plan.

We face significant competition from traditional media companies which
could limit our ability to generate advertising revenue.

We also compete with traditional media companies for advertising.
Most advertisers currently spend only a small portion of their advertising
budgets on Internet advertising. We do not have indication that these
traditional advertisers will allocate some of their advertising budget for our
services.

Decreases or delays in advertising spending by advertisers due to general economic
conditions could harm our ability to generate advertising
revenue.

Expenditures by advertisers tend to be cyclical, reflecting overall
economic conditions and budgeting and buying patterns. Since our business plan
anticipates significant activities from advertising, any decreases in or delays in advertising
spending due to general economic conditions could reduce our chances in carrying
out our plan.

We are, and
may in the future be, subject to intellectual property infringement claims,
which are costly to defend, could result in significant damage awards, and could
limit our ability to provide certain content or use certain technologies in the
future.

Internet, technology, media companies and patent holding companies often
possess a significant number of patents. Further, many of these companies and
other parties are actively developing or purchasing search, indexing, electronic
commerce and other Internet-related technologies, as well as a variety of online
business models and methods. We believe that these parties will continue to take
steps to protect these technologies, including, but not limited to, seeking
patent protection. As a result, disputes regarding the ownership of technologies
and rights associated with online business are likely to continue to arise in
the future.

As we expand our business and develop new technologies, products and
services, we may become increasingly subject to intellectual property
infringement claims. In the event that there is a determination that we have
infringed third-party proprietary rights such as patents, copyrights, trademark
rights, trade secret rights or other third party rights such as publicity and
privacy rights, we could incur substantial monetary liability, be required to
enter into costly royalty or licensing agreements or be prevented from using the
rights, any of which could require us to change our business practices in the future
and limit our ability to compete effectively. We may also incur substantial
expenses in defending against third-party infringement claims regardless of the
merit of such claims.

If we are unable to protect our intellectual
property, or obtain patents for the technologies we are currently researching, we may
lose a competitive advantage or incur substantial litigation costs to protect
our rights and we be unable to protect our intellectual property rights.

Our future success depends in part upon our
proprietary technology.  Our protective measures, including future patents,
trademarks and trade secret laws, may prove inadequate to protect our
proprietary rights.  We are in the process of filing patent applications for our
technologies and although we do not currently foresee issues arising as a result
of our pending patents, there can be no assurance that any of these patents will
be issued or that patents will not be challenged.  Established companies in our
industry generally are aggressive in attempts to block new entrants to their
markets, and our products, if developed and commercialized, may interfere (or
may be alleged to interfere) with the intellectual property rights of these
companies.  Our viability will depend on its products not infringing patents
that we expect would be vigorously prosecuted.  Furthermore, the validity and
breadth of claims in our technology patents involve complex legal and factual
questions and, therefore, are highly uncertain.  Even if we are granted patents
relating to our technology, there can be no assurance that we would be able to
successfully assert our patents against competing products.  Once we receive a
patent, the scope of any patent to which we have or may obtain rights may not
prevent others from developing and selling competing products.  The validity and
breadth of claims covered in technology patents involve complex legal and
factual questions, and the resolution of such claims may be highly uncertain,
lengthy, and expensive.  In addition, any future patents which we may file may
be held invalid upon challenge; others may claim rights in or ownership of our
patents.

We may not be able to enforce or protect our intellectual property rights, which may harm our
ability to compete and adversely affect our business.

Our ability to enforce our patents, copyrights, software licenses, and other intellectual
property is subject to general litigation risks, as well as uncertainty as to
the enforceability of our intellectual property rights in various countries.
When we seek to enforce our rights, we are often subject to claims that the
intellectual property right is invalid, is otherwise not enforceable, or is
licensed to the party against whom we are asserting a claim. In addition, our
assertion of intellectual property rights often results in the other party
seeking to assert alleged intellectual property rights of its own against us,
which may adversely impact our business in the manner discussed above. If we are
not ultimately successful in defending ourselves against these claims in
litigation, we may not be able to sell a particular product or family of
products, due to an injunction, or we may have to pay material amounts of
damages, which could in turn negatively affect our results of operations. In
addition, governments may adopt regulations or courts may render decisions
requiring compulsory licensing of intellectual property to others, or
governments may require that products meet specified standards that serve to
favor local companies. Our inability to enforce our intellectual property rights
under these circumstances may negatively impact our competitive position and our
business.

If we are
unable to retain our existing senior management and key personnel and hire new
highly skilled personnel, we may not be able to execute our business
plan.

We are substantially dependent on the continued services of our
senior management, including our  chief executive officer, Benedict Van,
and our chief technical officer (name withheld due to privacy purposes). These individuals have acquired specialized knowledge and
skills in the Internet industries and our business operations. The loss of any of these
individuals could harm our business. Our business is also dependent on our
ability to retain, hire and motivate talented, highly skilled personnel. The
competition for such executives and for other highly skilled personnel can be
intense, particularly in the San Francisco Bay Area, where our corporate
headquarters, and the headquarters of several of our vertical and horizontal
competitors, are located. If we do not succeed in recruiting, retaining and
motivating our key employees and in attracting new key personnel, we may be
unable to meet our business plan and as a result, our stock price may decline.

Our directors and executive officers may experience conflicts of interest
which may detrimentally affect our business development activities and our results of operations.

Our principal executive officers and directors,
also serve in capacities at other companies that may be a direct or indirect
conflict to our business.  They may also be inventors or visionaries of our
technologies.  To the extent that our interests diverge from those of the other
companies our executive officers and directors may become subject to conflicts
of interest which could lead them to make decisions which are not necessarily in
the best interests of our other stockholders.  This could result in material
adverse consequences to our company, its value and the value of your investment
in the Company.

We operate in intensely
competitive industries, and our failure to respond quickly to technological
developments and incorporate new features into our products could have an
adverse effect on our ability to compete.

We operate in intensely
competitive industries that experience rapid technological developments, changes
in industry standards, changes in customer requirements, and frequent new
product introductions and improvements. If we are unable to respond quickly and
successfully to these developments, we may lose our competitive position, and
our products or technologies may become uncompetitive or obsolete. To compete
successfully, we must maintain a successful R&D effort, develop new products and
enhance the synergies between our products, and improve our existing products
and processes at the same pace or ahead of our competitors. We may not be able
to successfully develop and market these new products, the products we invest in
and develop may not be well received by customers, and products developed and
new technologies offered by others may affect the demand for our products. These
types of events could have a variety of negative effects on our competitive
position and our financial results, such as reducing our revenue, increasing our
costs, lowering our gross margin percentage, and requiring us to recognize
impairments of our assets.

We may have
difficulty scaling and adapting our existing technology architecture to
accommodate increased traffic when we launch our products and services.

Our products and services have only been tested on a limited basis. As
we launch our products and services through our marketing campaign, we
expect Internet traffic to our websites to significantly increase over a short
time.  We have very limited experience in handling a heightened traffic level
by our hardware and customer service operations. Our future
will depend on our ability to adapt to rapidly changing technologies, to
adapt our products and services to evolving industry standards and to improve
the performance and reliability of our products and services. Rapid increases in
the levels or types of use of our online properties and services could result in
delays or interruptions in our service.

New technologies could block our advertisements or our search marketing listings,
which would harm our operating results.

Technologies have been developed and are likely to continue to be
developed that can block the display of our advertisements or our search
marketing listings. Advertisement-blocking technology
could have an adverse affect on our ability to execute our plan to capture
revenues.

Our online operations are subject
to security risks and systems failures.

Security risks.

Online security breaches could
materially adversely affect our collective businesses, financial condition, or
results of operations. Any well-publicized compromise of security could deter
use of the Internet in general or use of the Internet to conduct transactions
that involve transmitting confidential information or downloading sensitive
materials in particular. In offering online payment services, we may
increasingly rely on technology licensed from third parties to provide the
security and authentication necessary to effect secure transmission of
confidential information, such as consumer credit card numbers. Advances in
computer capabilities, new discoveries in the field of cryptography or other
developments could compromise or breach the algorithms that we use to protect
our consumers' transaction data. In addition, experienced programmers or
"hackers" may attempt to misappropriate proprietary information or cause
interruptions in our services which could require us to expend significant
capital and resources to protect against these problems.

Other system failures.

The uninterrupted performance of
our computer systems is critical to the operations of our Internet sites. We may
have to restrict access to our Internet sites to solve problems caused by
computer viruses or other system failures. Our customers may become dissatisfied
by any systems disruption or failure that interrupts our ability to provide our
content. Repeated system failures could substantially reduce the attractiveness
of our Internet site and/or interfere with commercial transactions, negatively
affecting our ability to generate revenues. Our Internet sites must, in the
future if we grow, accommodate
a high volume of traffic and deliver regularly updated content. Our sites have,
on occasion, experienced slower response times and network failures. These types
of occurrences in the future could cause users to perceive our web sites as not
functioning properly and therefore induce them to frequent Internet sites other
than ours. In addition, our customers depend on their own Internet service
providers for access to our sites. Our revenues could be negatively affected by
outages or other difficulties customers experience in accessing our Internet
sites due to Internet service providers' system disruptions or similar failures
unrelated to our systems.

We may be exposed to liability over privacy concerns.

Despite the display of our privacy policy on our
website, any penetration of our network security or misappropriation of our
customers' personal or credit card information could subject us to liability. We
may be liable for claims based on unauthorized purchases with credit card
information, impersonation or other similar fraud claims. Claims could also be
based on other misuses of personal information, such as for unauthorized
marketing purposes. These claims could result in litigation, which could divert
management's attention from the operation of our business and result in the
imposition of significant damages. In addition, the Federal Trade Commission and
several states have investigated the use by Internet companies of personal
information. In 1998, the U.S. Congress enacted the Children's Online Privacy
Protection Act of 1998. The Federal Trade Commission recently promulgated final
regulations interpreting this act. We depend upon collecting personal
information from our customers and we believe that the regulations under this
act will make it more difficult for us to collect personal information from some
of our customers. Any failure to comply with this act may make us liable for
substantial fines and other penalties. We could also incur expenses if new
regulations regarding the use of personal information are introduced or if our
privacy practices are investigated.

Our management
owns or controls a significant number of the outstanding shares of Common Stock
and will continue to have significant ownership of its voting securities for the
foreseeable future.

Our management, either directly or indirectly through their control of
affiliated companies, own or control approximately 50.9% of our issued and
outstanding capital stock as of December 31, 2007.   See "Security Ownership of Certain Beneficial Owners
and Management."  As a result, these persons would have the ability, acting as a
group, to effectively control our affairs and business, including the election
of directors and subject to certain limitations, approval or preclusion of
fundamental corporate transactions.  This concentration of ownership may be
detrimental to the interest of our minority shareholders in that it may:

We do not intend to pay dividends in the foreseeable future.

We have never paid cash dividends.  We do not anticipate that we would pay cash dividends in
the foreseeable future.  Instead, we intend to retain future earnings, if any,
for reinvestment in its business and/or to fund future acquisitions.  You should
not invest in our securities in the anticipation of receiving dividends.



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 is expiring on April 30, 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.

On January 28, 2008, the Company entered into a 5-year lease agreement with
1061 Terra Bella Associates, LLC for approximately 17,000 square feet of office
space at 1061 Terra Bella Avenue in Mountain View, California.  This lease
expires on February 28, 2013 and rent expense is approximately $23,000 per month
beginning in May 2008.  The Company will be headquartered at this location. 
We plan to sublease the space at the Techmart for the remainder of that lease
term.

No lawsuits or proceedings are currently
pending against hereUare.

Item 4. Submission of Matters to a Vote of Security Holders.

Not applicable.

PART II

Item 5. Market for Common Equity, Related Stockholder Matters, and Small
Business Issuer Purchases of Equity Securities.

Market Information

There is currently no active market for our securities.

Holders

As of December 31, 2007 there were 292 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.

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

In the quarterly period ended December 31, 2007, the Company sold an
aggregate of 159,948 shares of $0.0001 par value common stock to  25 individuals
in a private placement exempt from registration under Rule 506 of Regulation D
of the Securities Act of 1933. Within this transaction, 5,001 shares were sold
at $6 per share and 154,947 shares were sold at $9.00 per
share for an aggregate proceed of $1,424,527. 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
2007.

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 Company's  as of and for the fiscal years ended December 31, 2007 and 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
"Description of Business--Risk Factors Affecting Future Performance" 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

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 did 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 Company's most critical accounting policies are applied consistently for all years presented and many are described in Note 2 of our
financial statements. 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, 2007, the Company was primarily developing products
and was not generating revenues.

Revenues and Gross Profit (Loss)

During the year ended December 31, 2007, we only generated sales of $35,996
which was mainly from the Company's VoIP product. Cost of goods was 
$56,776 which included domestic and international telecom termination charges
for testing purposes, resulted in a gross loss figure of ($20,780). 
Revenue for the year ended December 31, 2006 was $38,118 and cost of goods was $77,328 resulting in a gross loss of ($39,210). 
Development of our Internet software technologies has generally been completed
as of yearend 2007, and we will attempt to market our products beginning in
2008.  However, there can be no assurance that we can generate significant
sales from such attempts.

Costs and Expenses

For the year ended December 31, 2007
our depreciation and amortization expenses were $297,932 and $97,041
for the years ended December 31, 2007 and 2006.  The increase was due to
equipment and software purchased towards the end of fiscal 2006, thereby causing
higher depreciation and amortization expenses in 2007.

Our rent expenses were $278,452 and $216,435 for the years
ended December 31, 2007 and 2006.

Our payroll expenses were $956,820 which reflected a slight
increase in engineering and marketing staff as compared to $911,095 for the
previous year.  For the year ended December 31, 2007, we also incurred
professional fees of $700,135 which included $158,041 for legal, $55,486 for
accounting, $336,119 in consulting fees for software engineering and business
consultation, and $120,000 of non-cash compensation for financial advisory
services. In the prior year, we had professional fees in the amount of $551,236which included $170,360 for legal, $90,265 for accounting, $270,191 in
consulting fees for software engineering and business consultation.

General and administrative expenses for the year ended December 31, 2007
were $1,785,135 which included $1,192,618 in non-cash option expenses estimated
by using a Black-Scholes option pricing model, $107,468 for insurance premiums,
$207,920 for travel and entertainment, $59,740 for advertisement, $43,605 for
phone, $25,705 for broadband services, $29,680 for supplies and $24,000 for R&D
expense.  G&A expenses for the previous year were
$11,674,758 which included non-cash
option expenses in the amount of $10,044,900 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.

As a result of foregoing factors, our net loss was
($4,039,533) for the year ended December 31, 2007, as compared to
($13,484,750) for the year ended December 31, 2006. Net loss per share
decreased to ($0.12) in 2007
from ($0.63) in 2006, while weighted average number of shares outstanding
increased to 33,967,404 by the end of the year 2007 from 21,431,409  of a year ago.

Liquidity and Capital Resources

Net cash flow for the twelve months ended December 31, 2007
was
a positive $567,521.
There was a net inflow of $3,486,965 from financing activities. Cash flow from operating activities
was a negative ($2,319,884) on a consolidated basis while net cash used in
investing activities was ($599,560).

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. During fiscal 2007, the Company raised approximately $3.5 million from
the sale of approximately 0.5 million shares while during fiscal 2006 the
Company raised approximately $1.4 million from the sale of approximately 0.6
million shares. The independent auditor's report on the Company's December 31, 2007
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 30 through 46 of this report.



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

Not applicable.



Item 8A(T).  Controls and Procedures

(a) Disclosure Controls and Procedures.

Disclosure Controls and Procedures.Our disclosure controls and procedures are designed to ensure that information required to be disclosed in the
Company's reports filed under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in the
SEC's rules and forms, including, without limitation, that such information is accumulated and communicated to Company management, including our principal
executive and financial officers, as appropriate to allow timely decisions regarding required disclosures.

Limitations on the Effectiveness of Disclosure Controls.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. 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.

Evaluation of Disclosure Controls and Procedures.Our principal executive and financial officers have evaluated the effectiveness of the design and
operation of our disclosure controls and procedures as defined in Exchange Act Rules 13a-14(c) as of December 31, 2007, and have determined that they are
reasonably effective, taking into account the totality of the circumstances, including the limitations described above.

(b) Internal Control over Financial Reporting.

Our management is responsible for establishing and maintaining adequate internal control over our financial reporting, which 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.

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, assessed the effectiveness of our internal control
over financial reporting as of  December 31, 2007. In making this assessment we used the criteria set forth by the Committee of Sponsoring Organizations
of the Treadway Commission (COSO) in Internal Control - Integrated Framework.

Based on the assessment using those criteria, management concluded that, as of December 31, 2007, our internal control over financial reporting is
effective.  Our assessment takes into consideration that we currently have little or no revenue and inventory so that the impact of revenue recognition and
inventory write-down policies and controls has not been material to our financial reporting.  We currently maintain our books using QuickBooks and we intend
to switch as our business grows.

This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting.
Management's report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Securities Exchange Commission
that permit us to provide only management's report on internal control over financial reporting in this annual report.

There were no significant changes in the Company's internal control over financial reporting that occurred during the Company's fiscal 2007 fourth quarter
ended December 31, 2007, that have materially affected, or are reasonably likely to materially affect, such control.

Item 8B. Other Information.

None.



PART III

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

Our directors, executive officers and key employees and their respective ages and
positions are set forth below. Biographical information for each of those
persons is also presented below. Our executive officers are appointed by our
Board of Directors and serve at its discretion.

MANAGEMENT

Directors and Executive Officers

The following table sets forth, as of December 31, 2007 the
names and ages of all of our directors and executive officers and all positions
and offices held. All directors hold office until such director's successor is elected and qualified. Each officer serves at the pleasure of the board and may be removed at any time
by a vote of a majority of the authorized directors.  It is anticipated that
each of the remaining directors and executive officers will continue in his
position, although there is no understanding or arrangement to that effect.
However, any of the above directors or executive officers could resign and any
of the officers could be replaced or removed by the Board of Directors at any
time. There are no family relationships among any directors or executive
officers of the Company.

|Name               | Age | Position with the Company                                  
|------------------ | --- | -----------------------------------------------------------
|Benedict Van       | 47  | Chief Executive Officer, Chairman of the Board of Directors
|Anthony K. Chan    | 53  | Chief Financial Officer, Director and Secretary            
|James McCargo      | 56  | Director                                                   
|David A. Brewer    | 55  | Director                                                   
|Gregory B. Pelling | 49  | Director                                                   

The board of directors has appointed committees of the board on
June 25, 2007 including a compensation committee and an audit committee. The
members of both which are all of the committees are the Company's independent
directors, Messrs. Brewer, McCargo, and Pelling.



Business Experience

The following summarizes the occupation and business experience during the past five
years for our officers and directors.

Benedict Van. Since 2002, Mr. Van has served as Chairman of the Board of Directors and CEO of
hereUare, Inc. Mr. Van has over
21 years of success and experience as a tech visionary, with a specialty in
building and restructuring high tech related companies. In 1996, he founded eCapital Group,
an investment firm specialized in nurturing high tech, biotech, and energy
ventures through their development stages. Portfolio investments for eCapital
Group have included hereUare Communications, Voiceplanet, Inc., 3E Systems,
Inc., hereUare, Inc., 3Net Communications Corporation, PeopleWeb Communications, Inc., BenSys Corporation, and Doles Networks
Corporation. Prior to eCapital, he founded in 1985 Crownland Group of Companies
and served as CEO of the international conglomerate that engaged in venture
capital investments in telecom, electronics, and medical devises. Crownland
invested successfully into Biocompatible, Inc., and Cardio Genesis (formerly
Eclipse Surgical Technology, Inc.). Mr. Van received his Doctorate of Business
Administration from University of the Pacific.

Anthony K. Chan.Mr. Chan has served as our Chief Financial Officer and
Director since December 2005. Previously, from February 2002 through July 2003,
he was the President, Chief Operating Officer and Director.  In July 2005 Mr.
Chan co-founded Golden Gate China Acquisition Corporation, which focuses on M&A
and PIPE transactions in China.  He also served as the CEO of Pacific Systems
Control Technology, the former parent company of PeopleNet International from
1997 to February 2003. From 1985 to 1990, Mr. Chan served as the Director of
Chinese Affairs for the Eisenberg Group of Companies, a diversified business
enterprise, where Mr. Chan's principal duty was to negotiate technology transfer
contracts in the People's Republic of China. Prior to 1985, Mr. Chan was
employed by Bank of America as an economic forecaster. Mr. Chan received his MBA
and BA degrees from the University of California at Berkeley.

James McCargo. Mr. McCargo has served as a member of our Board of Directors since November 2004.
Mr. McCargo served as President and CEO of Omega Designs, and was the principal
founder of InterArt Designs. Before founding InterArt, Mr. McCargo spent over 20
years involved in the computer and high-tech industry, including positions with
Fairchild Semiconductors, Hunt Chemical, and 3M Corporation. Mr. McCargo served
as a Trustee for the University of the Pacific, and was the Vice Chairman of the
Board of Regents for the University of the Pacific. Mr. McCargo holds a
Bachelor's of Arts degree in pre-law from University of the Pacific.

David A. Brewer. 
Mr. Brewer has served as a member of our
Board of Directors since February 2006. Mr. Brewer is the Managing Partner of Aragon Ventures,
a Menlo Park, California venture capital firm specializing in early stage, high technology companies. He
serves on the boards of directors of Notify Technology Corp., Cuica
Technologies, Inc., FirstStone Incubators LLC, and PriaVision, Inc.  He
currently serves as an officer, director or advisor to two other investment
companies.  Mr. Brewer is also the Chairman of End Poverty Foundation, a
nonprofit organization dedicated to the eradication of poverty through
empowerment of entrepreneurs in developing countries, and a board member of the
SEEP Network.  Before forming Aragon Ventures in 1998, Mr. Brewer was a
co-founder and the initial President of Inktomi Corporation, an Internet
infrastructure software company which was subsequently acquired by Yahoo, Inc. 
In his over thirty years in high technology start-ups, he also served as
president or chief financial officer in several early stage companies, including
Explore Technologies (electronic educational toys), eFax.com, formerly JetFax,
(advanced fax technology products), Monogram Software (consumer financial
software), Telebit (high speed modems and other data communications equipment)
and Packet Technologies (two-way interactive cable television communication
systems).  Mr. Brewer holds a Bachelor's of Science degree in business from the
University of California, Berkeley, and a Juris Doctor from the University of
San Francisco.

Gregory B. Pelling. 
Mr. Pelling has served as a member of
our Board of Directors since March 2006. Mr. Pelling is a successful software entrepreneur, systems integrator,
outsourcer, management consultant, business executive and trusted advisor to
governments and Fortune 500 corporations, with experience spanning over 20
years.  Mr. Pelling has provided strategic advice on creating competitive advantage from IT and the
Internet to top corporations and governments in the region as the Managing
Director Asia Pacific and Japan for Cisco Systems Internet Business Solutions
Group and previously as Asia's Senior Partner of Pricewaterhouse Coopers'
Technology Consulting Practice.  His most recent book, Cisco: Net Impact, concerns business and
technology management in Asia.  In 2007, he took on the role of President and COO of NewHeights Software,
an innovative and fast growing telephony solution development company.  NewHeights is a leader in enterprise
telephony and has recently introduced an integrated conferencing solution along
with an edge application server powered by a next generation service creation
environment and collaboration management tools. Mr. Pelling is a graduate of the University of
British Colombia and holds an MBA in International Management.

Section 16(a) Beneficial Ownership Reporting Compliance

Section 16(a) of the Securities Exchange Act of
1934, as amended, requires the Company's directors, executive officers and
beneficial owners of more than 10% of the Company's common stock to file with
the Securities and Exchange Commission (SEC) initial reports of ownership and
reports of changes in ownership of common stock and other equity securities of
the Company.  The Company typically files these reports on behalf of its
directors and officers, based on information provided by them.  Except as noted 
below, the Company believes, based on its review of Forms 3, 4, 5, if any, and
periodic written representations from reporting persons, that all other
officers, directors and holders of more than 10% of the Company's common stock
complied with all Section 16(a) filing requirements for the 2006 fiscal year. 
Forms 4 for Benedict Van and eCapital Group were not timely filed covering four
transactions and instead a Form 5 was filed.

Code of Ethics

The Company has  adopted on June 25, 2007, a code of business
conduct and ethics that applies to its executive officers as
it institutionalizes corporate governance procedures.

Audit Committee Financial Expert

The Company established
committees of its board of directors on June 25, 2007, including an audit
committee.  The board of directors has determined that independent director
David A. Brewer qualifies as a financial expert and has elected him on June 25,
2007 as the chairperson of the board's audit committee.



Item 10. Executive Compensation

The following table sets forth the compensation paid by the
Company to its officers and directors for services rendered during the periods
indicated. No other executive officer received compensation in excess of $100,000
during the specified periods.

|Name               | Position                                                    | Year            | Salary               | Directors Fees Earned or
Paid in Cash | Option Awards (1)(4)  | Other Compensation     | Total                    
|------------------ | ----------------------------------------------------------- | --------------- | -------------------- | ------------------------------------- | --------------------- | ---------------------- | -------------------------
|Benedict Van       | Chief Executive Officer &  Chairman of the Board & Director | 2007
2006
2005  | $120,000$115,000None | NoneNoneNone                          | None$5,212,375(2)None | None$20,000$42,616 (5) | $120,000$5,347,375$42,616
|Anthony K. Chan    | Chief Financial Officer & Secretary & Director              | 2007

2006
2005 | $120,000$90,000None  | NoneNoneNone                          | None$1,158,306(2)None | None$25,870 (6)$6,538  | $120,000$1,274,176$6,538 
|James McCargo      | Director                                                    | 2007
2006
2005  | NoneNoneNone         | NoneNoneNone                          | $85,484$68,033(3)None | $12,000$24,000$15,000  | $97,484$92,033$15,000    
|David A. Brewer    | Director                                                    | 2007
2006
2005  | NoneNoneN.A.         | NoneNoneN.A.                          | $109,907$144,911N.A.  | NoneNoneN.A.           | $109,907$144,911N.A.     
|Gregory B. Pelling | Director                                                    | 2007
2006
2005  | NoneNoneN.A.         | NoneNoneN.A.                          | $97,696$146,470N.A.   | NoneNoneN.A.           | $97,696$146,470N.A.      

(1) Values of option awards granted in 2007 and 2006 were estimated at
award date using a Black-Scholes option pricing model with the following
weighted average assumptions: risk free interest rate as quoted by US treasury
bond yield for similar duration, dividend yield
of 0%, expected weighted average option life of 4 to 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.

(2) Value estimated due to a 3-year extension of options granted to the holder in 2002
which would have expired in May 2006.

(3) Including $56,873 in value estimated due to extension of options as describe
in above note (2).

(4) As of December 31,
2007, Mr. McCargo held 422,000 options, Mr. Brewer held 304,000 options and Mr. Pelling
held 298,000 options.

(5) Compensation paid
to Mr. Van for his services other than as the chief executive of the Company.

(6) Compensation paid
to Mr. Chan prior to his engagement with the company on a full-time basis.

Our executive officers currently receive a base
salary, which is less than market, and no bonus.  The bulk of their
compensation is long-term equity appreciation which aligns their interests
with those of our stockholders.  As we hire additional executive officers as
our business expands, they will likely receive market compensation packages,
including base salary, bonus, and option grants.  Neither Mr. Van nor Mr.
Chan has an employment contract.  During fiscal 2006, prior fully-vested option
grants of Messrs. Van and Chan, comprising 2,699,999 and 600,000 options,
which otherwise would have expired were extended for three years; the
exercise price of their options is $0.08 per share.

Our outside directors currently receive no directors
fees but instead receive an option grant upon their joining the board.  Both
Mr. Pelling and Mr. Brewer received five year option grants during fiscal 2006 for 250,000 shares
at $2.00 per share, half of which were immediately vested with 25,000 options
vesting on each of June 30 and December 31 of 2006 and 2007 and the remaining
25,000 vesting on February 13, 2008, and March 30, 2008, respectively,  the
anniversary dates of their joining the board of directors. On June 25, 2007, our
board appointed our three independent directors (Brewer, McCargo and Pelling) to
the audit committee and the compensation committee. For their services on such
committees of the board over the next three years, the three independent
directors were granted a total of 144,000 options that vest over a 36-month
period and exercisable at $6.00 per share.  The options described in this
paragraph represent all options granted to our independent directors in fiscal
years 2007 and 2006.

The following table shows certain information with respect to unexercised options
held on December 31, 2007, by the named executive officers:

Name
        Number of
        securities underlying unexercised options Exercisable
Number of securities underlying
        unexercised options Unexercisable
        
        Option Exercise Price
        Option Expiration DateBenedict Van, Chief
        Executive Officer, Chairman of the Board, and Director
        2,699,999
0
        
        $0.08
        5/18/2009Anthony K. Chan, Chief Financial Officer and Director
        600,000
0
        
        $0.08
        5/18/2009




Item 11. Security Ownership of Certain Beneficial Owners and Management
and Related Stockholder Matters.

The following table sets forth, as of
March 31, 2008, certain information with respect to stock ownership of:

- all persons known by us to be beneficial owners of 5% or more of our outstanding shares of $0.0001 par value Common Stock;
- each director and officer; and
- all directors and officers as a group.

The table assumes a
total of 34,344,975 shares of common stock outstanding. In calculating the
number of shares of common stock beneficially owned by a person or group and the
percentage ownership of that person or group, we deemed outstanding shares
subject to options or warrants held by that person or group that are currently
exercisable or exercisable within 60 days of March 31, 2008. We did not deem
these shares outstanding, however, for the purpose of computing the percentage
ownership of any other person or group.

|Name and Address of Beneficial Owner (8)          | Number of Shares of Common Stock (9) | Percentage of Common StockOwnership*
|------------------------------------------------- | ------------------------------------ | ------------------------------------
|ECapital Group, Inc. (1)                          | 13,769,886                           | 40.09%                              
|PeopleWeb Communications, Inc. (1)                | 3,060,229                            | 8.91%                               
|Adel M. Ali                                       | 3,260,000                            | 9.49%                               
|Benedict Van (director and executive officer) (1) | 2,886,358 (2)                        | 7.79%                               
|Anthony K. Chan (director and executive officer)  | 849,146 (3)                          | 2.43%                               
|James McCargo (director)                          | 392,833 (4)                          | 1.13%                               
|David A. Brewer (director)                        | 391,500 (5)                          | 1.13%                               
|Gregory B. Pelling (director)                     | 264,667 (6)                          | 0.76%                               
|All Directors and Officers as a group (5 persons) | 4,784,504 (7)                        | 12.41%                              

(1) Mr. Van is also the controlling
person of eCapital Group, Inc. ("eCapital"), and through eCapital he also controls  PeopleWeb
Communications, Inc. ("PeopleWeb"). Mr. Van disclaims beneficial ownership of the Company
shares owned by eCapital and PeopleWeb. His pecuniary interest in the Company's
shares, based on his percent ownership of such entities would be approximately
12,385,000 and 1,826,000 shares, respectively. Mr. Van is the sole director of eCapital and the sole director
of PeopleWeb. Including his pecuniary interest in such entities and his options described in Note (2) below, Mr. Van
would beneficially own 17,097,358 shares which is 46.2%.

(2) Includes 2,699,999 shares issuable upon exercise of
options exercisable within sixty days of
March 31, 2008.

(3) Includes 600,000 shares issuable upon exercise of options
exercisable within sixty days of March
31, 2008.

(4) Includes 392,833 shares issuable
upon exercise of options exercisable within sixty days of March 31, 2008.

(5) Includes 266,500 shares issuable upon exercise of options
exercisable within sixty days of March 31, 2008.

(6) Includes 264,667 shares issuable upon exercise of options
exercisable within sixty days of March 31, 2008.

(7) Includes 4,223,999 shares issuable
upon exercise of options exercisable within sixty days of March 31, 2008.
This total excludes shares of ECapital Group, Inc. and PeopleWeb Communications
which Mr. Van may be deemed to beneficially own per note (1). Including his
pecuniary interest in such entities, officer and directors as a group would beneficially own 18,995,504 shares which is 49.3%.

(8) The address for the directors and executive officers,
and for Mr. Ali, is c/o hereUare, Inc.,
5201 Great America Parkway, Suite 446, Santa Clara, California 95054.

The address for ECapital Group is
5201 Great America Parkway, Suite 320, Santa Clara, CA 95054.

The address for PeopleWeb
Communications is 5201 Great America Parkway, Suite 320, Santa Clara, CA 95054.

(9) To the Company's knowledge, the
persons named in the table have sole voting and investment power with respect to
all shares of common stock shown as beneficially owned by them, subject to
community property laws, where applicable, and the information contained in the
footnotes to this table.

Securities Authorized for Issuance under Equity Compensation Plans

As of December 31, 2007, 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      7,436,999         $1.86             11,563,001
                                  =========         =====             ==========`



On September 22, 2006, the Company acquired hereUare
Communications, Inc., ("HCI") issuing
15,985,500 Company common shares to retire an equal number of HCI common shares.
HCI 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 HCI. 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 HCI. Mr. Van and his affiliated companies
owned approximately 55.6% of the outstanding HCI 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 Company. In addition, Anthony K. Chan, a director of the Company and its CFO, was the
CFO of HCI but held no equity in HCI. James McCargo, a director of the Company,
owned 200,000 HCI warrants which expired upon completion of the merger. David
Brewer, a director of the Company, owned 125,000 HCI common shares which were
converted into 125,000 Company common shares.

Using the standard
for independence promulgated by The Nasdaq Stock Market, Inc., each of Messrs.
McCargo, Brewer and Pelling are independent.  Each of Messrs. Van and Chan
are not independent.



Item 13. Exhibits.

(a) Exhibits and Index of Exhibits.

See Index to Exhibits on page 46 of this Form 10-KSB.



Item 14. Principal Accountant Fees and Services.

During the years ended December 31, 2007 and 2006, the following audit
fees were paid to Kabani & Company, Inc.. There were no tax or other fees paid.



`Description of Services          2007        2006
                                   ----------  ----------
     Audit Fees                    $  45,500   $  45,500
     Audit-Related Fees                 -           -
     Tax Fees                           -           -
     All Other Fees                     -           -
                                   ----------  ----------
          Total                    $  45,500   $  45,500
                                   ==========  ==========`

---

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 15, 2008



POWER OF ATTORNEY

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 15, 2008

|By: /s/ Anthony K. Chan
    Anthony K. Chan | Chief Financial Officer (Principal
    Financial Officer) and Member of the Board of Directors | April 15, 2008
|------------------------------------------- | ---------------------------------------------------------------------------------------------- | --------------

|By: /s/ James McCargo *
    James McCargo | Member of the Board of Directors | April 15, 2008
|----------------------------------------- | -------------------------------- | --------------

|By: /s/ David A. Brewer *
    David A. Brewer | Member of the Board of Directors | April 15, 2008
|--------------------------------------------- | -------------------------------- | --------------

|By: /s/ Gregory B. Pelling *
    Gregory B. Pelling | Member of the Board of Directors | April 15, 2008
|--------------------------------------------------- | -------------------------------- | --------------
|* By Anthony K. Chan, 
    attorney-in-fact         |                                  |               

---

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

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



We have audited the accompanying balance sheet of hereUare, Inc. (formerly known as PeopleNet International Corporation) as of December 31, 2007 and the related statements of operations, stockholders' equity, and cash flows for

We conducted our audits 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 financial statements are free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of
hereUare, Inc. as of December 31, 2007 and the results of its operations and its cash flows for the years



The Company's 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 deficit accumulated at December 31, 2007 of $69,048,968 including net losses of $4,039,533 for the year ended December 31, 2007. These factors as discussed in Note 14 to the financial statements, raises 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 14. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.





/s/ Kabani & Company, Inc.

CERTIFIED PUBLIC ACCOUNTANTS

Los Angeles, California
March 20, 2008

---

HEREUARE, INC. AND SUBSIDIARIES
(formerly PeopleNet International Corporation)
CONSOLIDATED BALANCE SHEET
DECEMBER 31, 2007

`ASSETS
                         ------

CURRENT ASSETS:
  Cash & cash equivalents                     $    705,839
  Inventory                                         21,811
  Prepaid expenses                                 165,763
  Related party receivable                          11,248
  Advances                                         170,000
                                              ------------
    Total current assets                         1,074,661
                                              ------------

PROPERTY AND EQUIPMENT - NET                       399,893
INTANGIBLE ASSETS - NET                            326,261
DEPOSITS                                           106,990
INVESTMENT                                       1,000,000
                                              ------------
         Total Other Assets                      1,833,144
                                              ------------
TOTAL ASSETS                                  $  2,907,805
                                              ============


           LIABILITIES AND STOCKHOLDERS' EQUITY
           ------------------------------------

CURRENT LIABILITIES:
  Accounts payable and accrued expenses       $    399,439
  Deferred revenue                                     247
                                              ------------
    Total current liabilities                      399,685
                                              ------------

STOCKHOLDERS' EQUITY:
  Common stock, $0.0001 par value;
    100,000,000 shares authorized;
    34,239,864 shares issued and
    outstanding                                      3,424
  Additional paid in capital                    71,606,663
  Subscription receivable                          (53,000)
  Accumulated deficit                          (69,048,968)
                                              ------------
    Total Stockholders' Equity                   2,508,119
                                              ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY    $  2,907,805
                                              ============`

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

---

HEREUARE, INC. AND SUBSIDIARIES
(formerly  PeopleNet International Corporation)
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 2007 AND 2006

`For The Year Ended
                                                         Dec 31,
                                                   2007           2006
                                              -------------  ------------

REVENUES                                      $      35,996  $     38,118
COST OF GOODS SOLD                                   56,776        77,328
                                              -------------  ------------
  Gross Profit (Loss)                               (20,780)      (39,210)

OPERATING EXPENSES
  Depreciation and amortization                     297,932        97,041
  Rent                                              278,452       216,435
  Salaries and payroll taxes                        956,820       911,095
  Professional fees                                 700,135       551,236
  General and administrative                      1,785,135    11,674,758
                                              -------------  ------------
    Total Costs and Expenses                      4,018,475    13,450,565
                                              -------------  ------------
LOSS FROM OPERATIONS                             (4,039,255)  (13,489,775)

OTHER INCOME (EXPENSE)
  Other expense                                        (357)         -
  Interest income (expense)                           1,928         5,825
                                              -------------  ------------
            Total Other Income                        1,571         5,825
                                              -------------  ------------

LOSS BEFORE INCOME TAXES                      $  (4,037,684) $(13,483,950)

PROVISION FOR INCOME TAXES                            1,849           800
                                              -------------  ------------
NET LOSS                                      $  (4,039,533) $(13,484,750)
                                              =============  ============

Basic & diluted weighted average number
  of common stock outstanding                    33,967,404    21,431,409
                                              =============  ============

Basic and diluted net loss per share          $       (0.12) $      (0.63)
                                              =============  ============`

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 PeopleNet International Corporation)
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
FOR THE YEARS ENDED DECEMBER 31, 2007 AND 2006

`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, 2006                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              33,704,668  $3,371  $66,461,460  $ (12,000)  $      -      $(65,009,435)  $    1,443,396
                               ==========  ======  ===========  ==========  ============  =============  ===============


Shares issued for cash            508,195      51    3,513,912    (53,000)         -              -           3,460,963

Cash received for subscription
  receivable from 2006               -          -         -        12,000          -              -              12,000

Shares issued for exercise
  of stock options                  7,001       1       14,001       -             -              -              14,002

Shares issued for services         20,000       2      119,998       -             -              -             120,000

Write-off of old liability           -          -      304,673       -             -              -             304,673

Option expenses                      -          -    1,192,618       -             -              -           1,192,618

Net loss for the year                -          -         -          -             -        (4,039,533)      (4,039,533)
                               ----------  ------  -----------  ----------  ------------  -------------  ---------------
Balance, as of
December 31, 2007              34,239,864  $3,424  $71,606,663  $ (53,000)  $      -      $(69,048,968)  $    2,508,119
                               ==========  ======  ===========  ==========  ============  =============  ===============`

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

---

HEREUARE, INC. AND SUBSIDIARIES
(formerly PeopleNet International Corporation)
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2007 AND 2006

`2007            2006
                                                         -------------   ------------
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net Loss                                               $  (4,039,533)  $(13,484,750)
  Adjustments to reconcile net loss to net cash
    used in operating activities:
      Depreciation and amortization                            297,932         97,041
      Issuance of shares for services                          120,000           -
      Deferred compensation charges                               -            90,318
      Warrants granted for dispute settlement                     -         1,238,303
      Issuance of stock options for compensation             1,192,618      9,954,582
      Write off old liability-noncash                          304,673           -
      (Increase) decrease in current assets:
          Account receivable                                      -           (28,553)
          Inventory                                            (21,811)          -
          Other assets                                        (127,829)      (227,312)
          Deposits                                             (63,345)        56,498
          Advances                                              87,539           (840)
          Related party receivable                             (10,408)          -
      Increase (decrease) in current liabilities:
          Accounts payable & accrued expenses                  (58,875)         4,024
          Deferred revenue                                        (845)         1,092
                                                         -------------   ------------
      Net cash used in operating activities                 (2,319,884)    (2,299,601)
                                                         -------------   ------------

CASH FLOWS FROM INVESTING ACTIVITIES
  Purchase of property and equipment                          (298,251)      (391,767)
  Purchase of software                                        (301,309)          -
  Cash from acquired subsidiary                                   -           474,851
                                                         -------------   ------------
  Net cash provided by (used in) investing activities         (599,560)        83,084
                                                         -------------   ------------

CASH FLOWS FROM FINANCING ACTIVITIES
  Proceeds from subsciption receivable                          12,000           -
  Proceeds from issuance of common stock for cash            3,474,965      1,415,000
  Receipt from (advance to) related parties                       -          (357,230)
                                                         -------------   ------------
      Net cash provided by financing activities              3,486,965      1,057,770
                                                         -------------   ------------

NET INCREASE (DECREASE) IN CASH & CASH EQUIVALENTS             567,521     (1,158,743)
CASH & CASH EQUIVALENTS, beginning balance                     138,317      1,297,060
                                                         -------------   ------------
CASH & CASH EQUIVALENTS, ending balance                  $     705,839   $    138,317
                                                         =============   ============

SUPPLEMENTAL DISCLOSURES:

    Income tax payments                                  $       1,849   $        800
                                                         =============   ============
    Interest payments                                    $        -      $       -
                                                         =============   ============`

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

---

HEREUARE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2007 AND 2006

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

Nature of Operations - hereUare, Inc. (the "Company") was incorporated on February 5, 1997 in the state of Delaware. The Company focuses on development and sales of communication software solutions including web-based email and office automation bundle and a voice over internet protocol telephony product. The Company had been a wholly owned subsidiary of Pacific Systems Control Technology, Inc. ("PSCT") until February 8, 2002 when the Company completed its spin-off transaction from PSCT and became an independent entity.

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, 2007.

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 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.

In February 2007, FASB issued FASB Statement No. 159, The Fair Value Option for Financial Assets and Financial
Liabilities. FAS 159 is effective for fiscal years beginning after November 15,
2007. Early adoption is permitted subject to specific requirements outlined in
the new Statement. Therefore, calendar-year companies may be able to adopt FAS
159 for their first quarter 2007 financial statements.

The new Statement allows entities to choose, at specified election dates, to measure eligible financial assets and
liabilities at fair value that are not otherwise required to be measured at
fair value. If a company elects the fair value option for an eligible item,
changes in that item's fair value in subsequent reporting periods must be
recognized in current earnings. FAS 159 also establishes presentation and
disclosure requirements designed to draw comparison between entities that elect
different measurement attributes for similar assets and liabilities.

In December 2007, the FASB issued SFAS No. 160, "Non-controlling Interests in Consolidated Financial Statements". This
Statement amends ARB 51 to establish accounting and reporting standards for the
non-controlling (minority) interest in a subsidiary and for the deconsolidation
of a subsidiary. It clarifies that a non-controlling interest in a subsidiary
is an ownership interest in the consolidated entity that should be reported as
equity in the consolidated financial statements. SFAS No. 160 is effective for
the Company's fiscal year beginning October 1, 2009. Management is currently
evaluating the effect of this pronouncement on financial statements.

In March 2008, the FASB issued FASB Statement No. 161, Disclosures about Derivative
Instruments and Hedging Activities. The new standard is intended to improve
financial reporting about derivative instruments and hedging activities by
requiring enhanced disclosures to enable investors to better understand their
effects on an entity's financial position, financial performance, and cash
flows The new standard also improves transparency about the location and
amounts of derivative instruments in an entity's financial statements; how
derivative instruments and related hedged items are accounted for under
Statement 133; and how derivative instruments and related hedged items affect
its financial position, financial performance, and cash flows. . It is
effective for financial statements issued for fiscal years and interim periods
beginning after November 15, 2008, with early application encouraged.
Management is currently evaluating the effect of this pronouncement on
financial statements.

In December 2007, the FASB issued SFAS No. 141(R), "Business Combinations". This Statement replaces SFAS No. 141, Business
Combinations. This Statement retains the fundamental requirements in Statement
141 that the acquisition method of accounting (which Statement 141 called the
purchase method) be used for all business combinations and for an acquirer to
be identified for each business combination. This Statement also establishes
principles and requirements for how the acquirer: a) recognizes and measures in
its financial statements the identifiable assets acquired, the liabilities
assumed, and any non-controlling interest in the acquiree; b) recognizes and
measures the goodwill acquired in the business combination or a gain from a
bargain purchase and c) determines what information to disclose to enable users
of the financial statements to evaluate the nature and financial effects of the
business combination. SFAS No. 141(R) will apply prospectively to business
combinations for which the acquisition date is on or after Company's fiscal year
beginning October 1, 2009. While the Company has not yet evaluated this
statement for the impact, if any, that SFAS No. 141(R) will have on its
consolidated financial statements, the Company will be required to expense
costs related to any acquisitions after September 30, 2009.

Note 3 - Property and Equipment

The property & equipment comprised of the following at December 31, 2007:

`Equipment                        $ 544,896
            Furniture                           94,067
                                             ----------
                                               638,963
            Less accumulated depreciation     (239,070)
                                             ----------
                                             $ 399,893
                                             ==========`

Depreciation expense was $156,071 and $56,959 for the years ended December 31, 2007 and 2006, respectively.

Note 4 - Intangible Assets

Intangible assets include software solutions and domain names, and the related accumulated amortization as of December 31, 2007 is as follows:

`Software solutions               $ 476,441
            Domain name purchased               32,321
                                             ----------
                                               508,762
            Less accumulated amortization     (182,501)
                                             ----------
                                             $ 326,261
                                             ==========`

Amortization expense was $141,861 and $40,082 for the years ended December 31, 2007 and 2006, respectively.

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

`Amortization

            2008:    $ 168,703
            2009:    $ 157,558`

Note 5 - Advances

Advances comprised of the following at December 31, 2007:

`Software development - messaging    $ 170,000
                                                ----------
                                                $ 170,000
                                                ==========`

Note 6 - Deposits

Deposits comprised of the following at December 31, 2007:

`Rent deposit                56,990
            Others                      50,000
                                     ----------
                                     $ 106,990
                                     ==========`

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, 2007 and therefore has reflected the investment in
the accompanying financial statements at cost on December 31, 2007.

Note 8 - Accounts Payable and Accrued Expenses

Account payable and accrued expenses comprised of the following at December 31, 2007:

`Accounts payable                 $ 237,573
            Accrued litigation                  72,000
            Accrued expenses                    89,866
                                             ----------
                                             $ 399,439
                                             ==========`

Note 9 - Related Party Receivables / Liabilities

Related party receivables of $11,248 included travel advance of $8,618 to the CEO of the Company, and $2,630 due from
eCapital Group, Inc., a company controlled by our CEO. The amounts are due on
demand, interest free and unsecured.

During the year ended December 31, 2007, the Company wrote off $304,673 of
old liabilities owed to creditors of our prior parent company, Pacific Systems
Control Technology.

Note 10 - Income Taxes

No provision was made for Federal income tax since the Company has significant net operating loss carry forward. Through
December 31, 2007, the Company incurred net operating losses for  tax purposes of approximately $19,844,000.
The net operating loss carry forward may be used to reduce taxable income
through the year 2027. Net operating loss carry forward for the State of
California is generally available to reduce taxable income through the year
2017. The availability of the Company's net operating loss carry forward is
subject to limitations if there is a 50% or more change in the ownership of the
Company's stock.

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:

`2007       2006
                                                    --------   --------
    Tax expense (credit) at statutory rate-Federal    -36%       -36%
    State tax expense net of federal tax               -4%        -4%
    Changes in valuation allowance                     40%        40%
                                                    --------   --------
    Tax expense at actual rate                          -          -
                                                    ========   ========`

Income tax expense consisted of the following:

`2007           2006
                                            ------------   ------------
   Current tax expense:
   Federal                                  $      -       $      -
   State                                          1,849            800
                                            ------------   ------------
   Total Current                            $     1,849    $       800


   Deferred tax credit:
   Federal                                  $   866,654    $   673,446
   State                                        152,939        118,645
                                            ------------   ------------
   Total deferred tax asset (liabilities)   $ 1,019,593        792,091
   Less: valuation allowance                 (1,019,593)      (792,091)
                                            ------------   ------------
   Net deferred tax credit                         -              -
                                            ------------   ------------
   Tax expense                              $     1,849    $       800
                                            ============   ============`

The components of the net deferred tax asset are summarized below:

`2007            2006
                             ------------    ------------
   Deferred tax asset        $ 7,454,000     $ 6,434,000
   Valuation allowance        (7,454,000)     (6,434,000)
                             ------------    ------------
                             $       -       $       -
                             ============    ============`

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, 2007.

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 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 - 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 annual 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 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`

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

`Proforma
                                          (unaudited)
                                         -------------
                                              2006
                                         -------------
Statement of Operations:
  Revenues                               $     42,810
  Cost of sales                                77,952
                                         -------------
  Gross profit (Loss)                         (35,142)
  Operating expenses                       13,542,787
                                         -------------
  Loss from operations                    (13,577,929)

  Other income                                  5,177

  Loss before income taxes                (13,572,752)

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

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

 Basic & diluted loss /share            $      (0.41)`

Note 13 - Common Stock / Options

Common Stock

2007

During the year ended December 31, 2007, the Company issued the following amounts of common stock:

`501,862 shares     For cash
      6,333 shares     For stock subscription receivable
      7,001 shares     For exercise of stock options
     20,000 shares     For services`

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.

Stock Options

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%.

On February 1, 2007, the Company granted a total of 287,000 options with an exercise of $6.00 per share to 5 employees and 1 consultant, and these options 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 August 13 and October 1, 2007, the Company granted a total of 758,000 options with an exercise of $6.00 per share to 8 employees and 3 consultants, and these options 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%.

On August 13, 2007, the Company granted a total of 144,000 options with an exercise price of $6.00 per share to 3 non-employee directors for their services on the Audit Committee and the Compensation Committee of the Board, and these options expire in 5 years.  These options vests over three years on a monthly basis at the rate of 2.778%.

Between October 18 and December 14, 2007, the Company granted a total of 140,000 options with an exercise of $9.00 per share to 2 consultants, and these options 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%.

On June 25, 2007, the Board of Directors approved the extension of expiration of 350,000 options which would expire on December 31, 2007, for another 2 years to December  31, 2009.

On December 17, 2007, the Board of Directors approved the extension of expiration of 75,000 options which would expire on November 18, 2007, for another 3 years to November 18, 2010.

The following summary presents the incentive and non-qualified options under the plan granted, exercised, expired and outstanding at December 31, 2007:

`Weighted
                                               Average     Aggregate
                                               Exercise    Intrinsic
                                 Under Plan     Price        Value
                                ------------   --------   ------------
  Balance, December 31, 2006      6,177,999      $0.91    $31,446,015
    Granted                       1,329,000       6.32
    Lapsed                          (62,999)      3.27
    Exercised                         7,001       2.00
                                ------------   --------   ------------
  Balance, December 31, 2007      7,436,999       1.86    $13,832,818
                                ============   ========   ============`

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, 2007:

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

  Options    7,436,999       2.40         $1.86       5,850,352     $0.88`

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 periods ended December 31, 2007 and 2006 include compensation expense for all stock-based compensation awards vested during the annual periods ended December 31, 2007 and 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, 2007 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 2007 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, 2007:

`Weighted
                                             Average     Aggregate
                                             Exercise    Intrinsic
                                              Price        Value
                                ----------   --------   -----------
  Balance, December 31, 2006      750,000      $ 6.00   $     -
    Granted                          -            -           -
    Exercised                        -            -           -
                                ----------   --------   -----------
  Balance, December 31, 2007      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, 2007:

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

  Warrants     750,000        2           $6.00        750,000      $6.00`

Note 14 - 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 $69,048,968 at December 31, 2007. The Company incurred a net loss of $4,039,533 and $13,484,750 for the years ended December 31, 2007 and 2006, 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 15 - 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 16 - Subsequent Events (Unaudited)

On January 28, 2008, the Company entered into a 5-year lease agreement with 1061 Terra Bella Associates, LLC, which expires on February 28, 2013. Rent expense per this new lease agreement is as following:

May 2008    - February 2009:   $22,950 per month
March 2009 - February 2010:   $23,800 per month
March 2010 - February 2011:   $24,650 per month
March 2011 - February 2012:   $25,500 per month
March 2012 - February 2013:   $26,350 per month





---

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 30

---

Exhibit 21.0

Subsidiaries of the Small Business Issuer

hereUare Communications, Inc., andCompleto Communications Corporation

---

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 (this "Report") of hereUare,
Inc. for the fiscal year ended December 31, 2007;

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 15, 2008

/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 (this "Report") of hereUare,
Inc. for this fiscal year ended December 31, 2007;

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 15, 2008

/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, 2007 (the "Amendment") 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 Amendment fairly presents, in all material
respects, the financial condition and results of operations of the Company.



Date: April 15, 2008

/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.