UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
10-Q
[X] |
Quarterly
Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 |
|
|
|
For
the quarterly period ended October 31, 2014 |
|
|
[ ] |
Transition
Report pursuant to 13 or 15(d) of the Securities Exchange Act of 1934 |
|
|
|
For
the transition period to
__________ |
|
|
|
Commission
File Number: 000-53985 |
Well
Power, Inc.
(Exact name of Registrant as specified in its charter)
Nevada |
61-1728870 |
(State
or other jurisdiction of incorporation or organization) |
(IRS
Employer Identification No.) |
|
11111
Katy Freeway - Suite # 910
Houston,
Texas 77079 |
(Address
of principal executive offices) |
|
(713)
973-5738 |
(Registrant’s
telephone number) |
|
_______________________________________________________________ |
(Former
name, former address and former fiscal year, if changed since last report) |
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the issuer was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days [X] Yes [ ] No
Indicate
by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 229.405 of this chapter) during the
preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [X] No [
]
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller
reporting company.
[
] Large accelerated filer
[
] Non-accelerated filer |
[
] Accelerated filer
[X]
Smaller reporting company |
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
[
] Yes [X] No
State
the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 111,861,934
common shares as of December 8, 2014.
PART
I - FINANCIAL INFORMATION
Item
1. Financial Statements
Our
financial statements included in this Form 10-Q are as follows:
These
financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America
for interim financial information and the SEC instructions to Form 10-Q. In the opinion of management, all adjustments considered
necessary for a fair presentation have been included. Operating results for the interim period ended October 31, 2014 are not
necessarily indicative of the results that can be expected for the full year.
Well
Power, Inc.
Balance
Sheets
(unaudited)
| |
| October
31, | | |
| April
30, | |
| |
| 2014 | | |
| 2014 | |
ASSETS | |
| | | |
| | |
Current Assets | |
| | | |
| | |
Cash | |
$ | 72,140 | | |
$ | 39,832 | |
Prepaid
expenses | |
| 14,131 | | |
| — | |
Total Current Assets | |
| 86,271 | | |
| 39,832 | |
Deferred financing
costs, net of amortization of $7,946 and $0, respectively | |
| 36,976 | | |
| — | |
Intangible
Assets, net | |
| 617,500 | | |
| 400,000 | |
Total
Assets | |
$ | 740,747 | | |
$ | 439,832 | |
LIABILITIES AND STOCKHOLDERS’
DEFICIT | |
| | | |
| | |
Current Liabilities | |
| | | |
| | |
Accounts payable
and accrued liabilities | |
$ | 424,503 | | |
$ | 323,136 | |
Short-term loan payable | |
| 35,000 | | |
| 35,000 | |
Due to related parties | |
| 173,850 | | |
| 102,759 | |
Stock payable | |
| 530,235 | | |
| 280,235 | |
Convertible debentures,
net of discount of $248,149 and $0, respectively | |
| 60,406 | | |
| — | |
Derivative
liabilities | |
| 366,582 | | |
| — | |
Total Liabilities | |
| 1,590,576 | | |
| 741,130 | |
Contingencies and Commitments | |
| | | |
| | |
Stockholders’ Deficit | |
| | | |
| | |
Common stock, 4,500,000,000
shares authorized, $0.001 par value; 111,861,934 and 107,500,000 shares issued and outstanding, respectively | |
| 111,862 | | |
| 107,500 | |
Additional
paid-in capital | |
| 2,098,707 | | |
| 1,801,802 | |
Accumulated
deficit | |
| (3,060,398 | ) | |
| (2,210,600 | ) |
Total
Stockholders’ Deficit | |
| (849,829 | ) | |
| (301,298 | ) |
Total
Liabilities And Stockholders’ Deficit | |
$ | 740,747 | | |
$ | 439,832 | |
The
accompanying notes are an integral part of these unaudited financial statements.
Well
Power, Inc.
Statements
of Operations
(unaudited)
| |
For the | |
For the | |
For the | |
For the |
| |
Three Months Ended | |
Three Months Ended | |
Six Months Ended | |
Six Months Ended |
| |
October
31, 2014 | |
October
31, 2013 | |
October
31, 2014 | |
October 31,
2013 |
Operating Expenses | |
| | | |
| | | |
| | | |
| | |
General
and administrative | |
$ | 350,456 | | |
$ | 2,000 | | |
$ | 394,878 | | |
$ | 4,000 | |
Professional
and consulting | |
| 138,114 | | |
| — | | |
| 302,338 | | |
| — | |
Total Operating Expenses | |
| (488,570 | ) | |
| (2,000 | ) | |
| (697,216 | ) | |
| (4,000 | ) |
Other Expense | |
| | | |
| | | |
| | | |
| | |
Interest expense | |
| (119,095 | ) | |
| — | | |
| (120,065 | ) | |
| — | |
Change
in fair value of derivatives | |
| (32,517 | ) | |
| — | | |
| (32,517 | ) | |
| — | |
Net Loss | |
$ | (640,182 | ) | |
$ | (2,000 | ) | |
$ | (849,798 | ) | |
$ | (4,000 | ) |
Net Loss Per Common
Share – Basic And Diluted | |
$ | (0.01 | ) | |
$ | (0.00 | ) | |
$ | (0.01 | ) | |
$ | (0.00 | ) |
Weighted Average
Common Shares Outstanding – Basic And Diluted | |
| 107,500,000 | | |
| 107,500,000 | | |
| 108,984,000 | | |
| 107,500,000 | |
The
accompanying notes are an integral part of these unaudited financial statements.
Well
Power, Inc.
Statements
of Cash Flows
(unaudited)
| |
For the | |
For the |
| |
Six Months Ended | |
Six Months Ended |
| |
October
31, 2014 | |
October
31, 2013 |
Cash Flows From Operating Activities | |
| | | |
| | |
Net loss | |
$ | (849,798 | ) | |
$ | (4,000 | ) |
Adjustments to reconcile net loss to net
cash used in operating activities: | |
| | | |
| | |
Amortization of discount and
intangible assets | |
| 91,245 | | |
| — | |
Interest expense
on excess fair value of derivatives | |
| 55,726 | | |
| | |
Amortization of
deferred financing costs | |
| 7,946 | | |
| — | |
Stock-based compensation | |
| 276,855 | | |
| | |
Change in fair value
of derivatives | |
| 32,517 | | |
| — | |
Changes in operating
assets and liabilities: | |
| | | |
| | |
Prepaid expenses | |
| (14,131 | ) | |
| — | |
Accounts
payable and accrued liabilities | |
| (148,633 | ) | |
| — | |
Net Cash Used in
Operating Activities | |
| (548,273 | ) | |
| (4,000 | ) |
Cash Flows From Financing Activities | |
| | | |
| | |
Net advances from
related parties | |
| 71,091 | | |
| 4,000 | |
Proceeds from issuance
of stock to be issued | |
| 250,000 | | |
| — | |
Net
proceeds from issuance of convertible debt | |
| 259,490 | | |
| — | |
Net Cash Provided
by Financing Activities | |
| 580,581 | | |
| 4,000 | |
Net Increase In Cash | |
| 32,308 | | |
| — | |
Cash - Beginning of Period | |
| 39,832 | | |
| — | |
Cash - End of Period | |
$ | 72,140 | | |
$ | — | |
Supplementary Cash Flows Information:
| |
| | | |
| | |
Interest
paid | |
$ | — | | |
$ | — | |
Income
taxes paid | |
$ | — | | |
$ | — | |
Noncash Investing and Financing Activities | |
| |
|
Debt
discount on convertible debentures
| |
$ | 24,412 | | |
$ | — | |
Stock
issued in connection with deferred financing cost | |
$ | 278,339 | | |
$ | — | |
Accounts
payable incurred for purchase of license | |
$ | 250,000 | | |
$ | — | |
The
accompanying notes are an integral part of these unaudited financial statements.
Well
Power, Inc.
Notes
to the Financial Statements
(unaudited)
1. Nature
of Business and Continuance of Operations
Well
Power, Inc. (the “Company”) was incorporated in Nevada on March 27, 2007. On December 10, 2013, the Company effected
a merger with its wholly-owned subsidiary, Well Power, Inc. As part of the merger, the Company authorized a name change from Vortec
Electronics, Inc. to Well Power, Inc. On January 22, 2014, the Company entered into an Exclusive License and Distribution Agreement
to distribute mobile and scalable Wellhead Micro-Refinery Units (MRU’s). Upon entering into the agreement, the Company is
a business whose planned principal operations are the sales and distribution of MRU’s in the state of Texas. As at October 31, 2014,
the Company has had no operating revenues to date.
The
Company has incurred losses since inception, has negative working capital, and has not yet received revenues from sales of products
or services. These factors create substantial doubt about the Company’s ability to continue as a going concern. The financial
statements do not include any adjustment that might be necessary if the Company is unable to continue as a going concern. The
ability of the Company to continue as a going concern is dependent on the Company generating cash from the sale of its common
stock and/or obtaining debt financing and attaining future profitable operations. Management’s plans include selling its
equity securities and obtaining debt financing to fund its capital requirement and ongoing operations; however, there can be no
assurance the Company will be successful in these efforts.
2. Summary
of Significant Accounting Policies
Basis
of Presentation
The
financial statements of the Company have been prepared in accordance with generally accepted accounting principles in the United
States of America and are presented in US dollars. The Company’s fiscal year end is April 30.
Interim
Financial Statements
The
accompanying unaudited interim financial statements of the Company have been prepared in accordance with accounting principles
generally accepted in the United States of America and the rules of the Securities and Exchange Commission ("SEC"),
and should be read in conjunction with the audited financial statements and notes thereto contained elsewhere in this prospectus.
In the opinion of management, all adjustments, consisting of normal recurring adjustments, necessary for a fair presentation of
financial position and the results of operations for the interim periods presented have been reflected herein. The results of
operations for interim periods are not necessarily indicative of the results to be expected for the full year. Notes to the financial
statements which would substantially duplicate the disclosure contained in the audited financial statements for the most recent
fiscal year end April 30, 2014 have been omitted.
Use
of Estimates
The
preparation of financial statements in conformity with United States generally accepted accounting principles requires management
to make 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. The Company regularly evaluates estimates and assumptions related to intangible assets and deferred income tax asset valuation
allowances. The Company bases its estimates and assumptions on current facts, historical experience and various other factors
that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the
carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources.
The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent
there are material differences between the estimates and the actual results, future results of operations will be affected.
Cash
and Cash Equivalents
The
Company considers all highly liquid investments with maturities of three months or less to be cash equivalents.
Financial
Instruments
The
Company’s financial instruments consist of cash and cash equivalents, accounts payable, accrued liabilities, short term
loan payable, convertible debt and an amount due to an officer. The carrying amount of these financial instruments approximates
fair value due either to length of maturity or interest rates that approximate prevailing market rates unless otherwise disclosed
in these financial statements.
Intangible
Assets
Intangible
assets include all costs incurred to acquire a licensing and distribution agreement. Intangible assets are recorded at cost and
amortized on a straight-line basis over their estimated useful life of 5 years. Management conducts an annual assessment of the
residual balances, useful lives and depreciation methods used. Changes arising from the assessment are applied by the Company
prospectively.
Deferred
Financing Costs
The
Company capitalizes direct costs incurred to obtain financings and amortize these costs over the terms of the related debt instrument
using the interest method. Upon the extinguishment of the related debt, any unamortized deferred financing costs are immediately
expensed.
Income
Taxes
Deferred
tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial
reporting and tax bases of assets and liabilities, and for operating loss and tax credit carryforwards. Deferred tax assets and
liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected
to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely
than not to be realized.
Foreign
Currency Translation
The
Company’s planned operations will be in the United States, which results in exposure to market risks from changes in foreign
currency exchange rates. The financial risk is the risk to the Company’s operations that arise from fluctuations in foreign
exchange rates and the degree of volatility of these rates. Currently, the Company does not use derivative instruments to reduce
its exposure to foreign currency risk. The Company's functional currency for all operations worldwide is the U.S. dollar. Nonmonetary
assets and liabilities are translated at historical rates and monetary assets and liabilities are translated at exchange rates
in effect at the end of the year. Revenues and expenses are translated at average rates for the year. Gains and losses from translation
of foreign currency financial statements into U.S. dollars are included in current results of operations.
Financial
Derivatives
All
derivatives are recorded at fair value on the balance sheet. Fair values for securities traded in the open market and derivatives
are based on quoted market prices. Where market prices are not readily available, fair values are determined using market based
pricing models incorporating readily observable market data and requiring judgment and estimates.
Fair
Value Measurement
The
Company values its derivative instruments under FASB ASC 820 which defines fair value, establishes a framework for measuring fair
value, and expands disclosures about fair value measurements.
Fair
value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date (exit price). The Company utilizes market data or assumptions that market participants would
use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation
technique. These inputs can be readily observable, market corroborated, or generally unobservable. The Company classifies fair
value balances based on the observability of those inputs. ASC 820 establishes a fair value hierarchy that prioritizes the inputs
used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical
assets or liabilities (level 1 measurement) and the lowest priority to unobservable inputs (level 3 measurement).
The
three levels of the fair value hierarchy are as follows:
Level
1 – Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets
are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information
on an ongoing basis. Level 1 primarily consists of financial instruments such as exchange-traded derivatives, marketable securities
and listed equities.
Level
2 – Pricing inputs are other than quoted prices in active markets included in level 1, which are either directly or indirectly
observable as of the reported date.
Level
3 – Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may
be used with internally developed methodologies that result in management’s best estimate of fair value. The Company uses
Level 3 to value its derivative instruments.
The
following table sets forth by level with the fair value hierarchy the Company’s financial assets and liabilities measured
at fair value on September 30, 2014.
| |
| Level
1 | | |
| Level
2 | | |
| Level
3 | | |
| Total | |
Liabilities | |
| | | |
| | | |
| | | |
| | |
Derivative liability | |
$ | — | | |
$ | — | | |
$ | 366,582 | | |
$ | 366,582 | |
Revenue
Recognition
The
Company recognizes revenue when products are fully delivered or services have been provided and collection is reasonably assured.
Stock-Based
Compensation
The
expense for equity awards vested during the reporting period is based upon the grant date fair value of the award. The expense
is recognized over the applicable vesting period of the stock award using the straight-line method.
Subsequent
Events
The
Company has evaluated all transactions through the date the financial statements were issued for subsequent event disclosure consideration.
Earnings
(Loss) Per Common Share
Basic
EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares
outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during
the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing Diluted
EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise
of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive. At October
31, 2014, the Company has no potentially dilutive securities outstanding.
Recent
Accounting Pronouncements
The
Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and
does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact
on its financial position or results of operations.
3.
Intangible Assets
On
January 22, 2014, the Company entered into an Exclusive License and Distribution Agreement (the “License Agreement”)
with ME Resources Corp (“MEC”), a Canadian publicly listed company. The President of the Company is related to a director
of MEC. Under the License Agreement, MEC appointed the Company as its exclusive distributor of Wellhead Micro-Refinery Units (“MRUs”)
for the initial state of Texas. The License Agreement is for 5 years from the date of execution, but can be extended for two successive
periods of an additional 5 years each.
Pursuant
to the License Agreement, the Company agreed to pay consideration of $400,000, payable in two instalments. $100,000 is to be paid
within 30 days (paid) and the balance of $300,000 is to be paid within 90 days ($375,000 paid as of October 31, 2014). At October
31, 2014, the Company recorded the costs of acquiring the license as an intangible asset, and the remaining balance of $25,000
has not been paid and is included in accounts payable and accrued liabilities.
On
August 31, 2014, the Company entered into an Exclusive License for Additional Territories (the “Additional License”)
with MEC. Under the Additional License, MEC appointed the Company as its exclusive distributor for the additional state of Montana.
The Additional License is considered an amendment to the License Agreement and will be considered under the same terms as the
License Agreement.
Pursuant
to the Additional License, the Company agreed to pay consideration of $250,000 payable within 60 days. As of October 31, 2014,
the Company recorded the cost of acquiring the additional license as an intangible asset, and the remaining balance of $250,000
has not been paid and is included in accounts payable and accrued liabilities.
During
the three months ended October 31, 2014, the Company recorded amortization of $32,500 on the acquired licenses.
4. Short-Term
Loan
On
December 18, 2013, the Company entered into a loan agreement in which the note holder agreed to provide a loan to the Company
in the principal amount of up to $35,000. The loan is unsecured, bears interest at 11% per annum and is payable on September 30,
2014. During the period ended October 31, 2014, the maturity date was extended to March 31, 2015. As at October 31, 2014, the
note holder has provided the full $35,000 to the Company, and interest of $3,246 has been accrued.
5. Due
To Related Parties
a)
The amount due to related parties of $173,850 and $102,759 at October 31, 2014 and April 30, 2014, respectively, consists of amounts
owed to officers and shareholders of the Company for amounts advanced to pay for professional services provided by the Company’s
outside service providers and for consulting services rendered for periods ending on and prior to October 31, 2014. The amount
is unsecured, non-interest bearing and due on demand.
b)
On January 22, 2014, the Company entered into a License Agreement with ME Resources Corp and on August 31, 2014 the Company entered
into an Additional License with ME Resources Corp (Note 3). The President of the Company is related to a director of MEC.
6. Common
Stock
The
Company’s authorized capital consisted of 4,500,000,000 shares of common stock with a par value of $0.001 per share.
There
were 111,861,934 shares of common stock issued and outstanding as of October 31, 2014.
On
March 10, 2014, the Company sold 431,034 units at $0.58 per unit for gross proceeds of $250,000. Each unit consisted of one common
share and one share purchase warrant. Each share purchase warrant is exercisable into one additional common share at an exercise
price of $0.90 per share for a period of 2 years from the date of issuance. The relative fair value of the shares and warrants
is $159,475 and $90,525, respectively. As of October 31, 2014, the Company is obligated to issue 431,034 common shares with a
fair value of $250,000, which has been recorded as stock payable.
On
June 5, 2014, the Company sold 5,000,000 units at $0.05 per unit for gross proceeds of $250,000. Each unit consisted of one common
share and one share purchase warrant. Each share purchase warrant is exercisable into one additional common share at an exercise
price of $0.90 per share for a period of 2 years from the date of issuance. The relative fair value of the shares and warrants
is $184,608 and $65,392, respectively. As of October 31, 2014, the Company is obligated to issue 5,000,000 common shares with
a fair value of $250,000, which has been recorded as stock payable.
On
August 26, 2014, pursuant to the equity purchase agreement described in Note 8(d), the Company issued 3,955,070 common shares
with a fair value of $279,855 which has been recorded in general and administrative expense.
On
August 6, 2014, the Company and issued 187,720 common shares with a fair value of $11,263, for financing costs relating to the
issuance of the convertible note described in Note 9(b).
On
August 21, 2014, the Company issued 135,810 common shares with a fair value of $8,149, for financing costs relating to the issuance
of the convertible note described in Note 9(c).
On
September 24, 2014, the Company issued 83,333 common shares with a fair value of $5,000, for financing costs relating to the issuance
of the convertible note described in Note 9(d).
As
at October 31, 2014, pursuant to the consulting agreement described in Note 8(a), the Company is obligated to issue 93,719 common
shares with a fair value of $30,235, which has been recorded as stock payable.
7. Stock
Options
On
March 14, 2014, the Company entered into two consulting agreements (refer to Note 8) whereby the Company granted 4,000,000 options
to purchase shares of common stock exercisable for a period of two years at a price of $0.70 per share.
The
following table summarizes information about the stock options.
| |
Number
of Options | |
Weighted
Average Exercise Price | |
Weighted
Average Remaining Contractual Life (years) | |
Aggregate
Intrinsic Value |
| Outstanding
and exercisable, October 31, 2014 | | |
| 4,000,000 | | |
$ | 0.70 | | |
| 1.37 | | |
$ | — | |
8. Commitments
And Contingencies
The
Company neither owns nor leases any real or personal property. An officer has provided office services without charge. There is
no obligation for the officer to continue this arrangement. Such costs are immaterial to the financial statements and accordingly
are not reflected herein. The officers and directors are involved in other business activities and most likely will become involved
in other business activities in the future.
a) On
January 10, 2014, the Company entered into a consulting agreement with a consultant who provided consulting services in consideration
for $6,000 per month for a 4 month term. The consulting fee is payable as follows:
i.
$3,000 per month settled in shares at the end of the term of the contract. The number of shares issuable is equal to $3,000 divided
by the average of the 3 lowest trading prices in the last 10 days of each month.
ii.
$3,000 per month payable in cash at the end of each month.
As
of October 31, 2014, no shares had been issued. The Company is obligated to issue 93,719 common shares.
b) On
March 14, 2014, the Company entered into a consulting agreement with the President of the Company for consulting services to be
provided over a one-year term in consideration for $1,000 per month for the first month, and $3,000 per month for the following
eleven months. The Company will also pay an initial signing bonus of $10,000. In addition, the President of the Company was granted
2,000,000 options to purchase shares of common stock exercisable for a period of two years at a price of $0.70 per share. During
the six months ended October 31, 2014, the Company recognized $18,000 in consulting fees under the agreement and $88,000 for additional
consulting fees incurred during the period.
c)
On March 14, 2014, the Company entered into a consulting agreement with the CEO of the Company for consulting services to be provided
over a one-year term in consideration for $3,000 per month. The Company will also pay an initial signing bonus of $10,000. In
addition, the CEO of the Company was granted 2,000,000 options to purchase shares of common stock exercisable for a period of
two years at a price of $0.70 per share. During the six months ended October 31, 2014, the Company recognized $18,000 in consulting
fees.
d)
On August 26, 2014, the Company entered into an Equity Purchase Agreement and Registration Rights Agreement with Premier Venture
Partners, LLC (“Premier”) whereby Premier is obligated, providing the Company has met certain conditions including
the filing of a Form S-1 Registration Statement for the shares to be acquired, to purchase up to $10,000,000 of the Company’s
common stock at the rates set forth in the Equity Purchase Agreement. On August 26, 2014, the Company issued 3,955,070 common
shares with a fair value of $279,855 to Premier.
9.
Convertible Debts
a)
On July 25, 2014, the Company entered into a $10,000 8% Convertible Promissory Note with a non-related third party. Under the
terms of the Convertible Promissory Note, all principal and interest matures on July 25, 2015. The third party shall have the
right to convert any unpaid sums into common stock of the Company at the rate of the lesser of $0.09 per share or 50% of the lowest
trade reported in the 10 days prior to date of conversion, subject to adjustment as described in the note. On September 16, 2014,
the non-related third party paid $10,000 legal fees on behalf of the Company as proceeds from the $10,000 convertible note. As
at October 31, 2014, the Company has recorded interest of $99.
The
embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging.
The initial fair value of the conversion feature of $14,581 resulted in a discount to the note payable of $10,000 and the reaming
$4,581 was recognized as interest expense. During the six months ended October 31, 2014, the Company recorded accretion of $5,538
increasing the carrying value of the note to $5,538.
b)
On August 6, 2014, the Company entered into a $275,000 10% Convertible Promissory Note with a non-related third party. Under the
terms of the Convertible Promissory Note, the Company will receive principal in one or more installments with a Maturity Date
for the Note of August 6, 2015. The third party shall have the right to convert any unpaid sums into common stock of the Company
at the rate of the lesser of $0.08 per share or 55% of the lowest trade reported in the 15 days prior to date of conversion, subject
to adjustment as described in the note. As at October 31, 2014, the Company has received $100,000 of principal, net of a discount
of $10,000, and has recorded interest of $2,367.
The
embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging.
The initial fair value of the conversion feature of $127,334 resulted in an additional discount to the note payable of $100,000
and the reaming $27,334 was recognized as interest expense. During the six months ended October 31, 2014, the Company recorded
accretion of $17,000 increasing the carrying value of the note to $17,000.
The
Company incurred financing costs of $18,263 which consisted of $7,000 cash and 187,720 common shares with a fair value of $11,263
(Note 6). As at October 31, 2014, the Company had unamortized debt issuance costs of $15,441 which are being amortized over the
life of the note payable.
c) On
August 21, 2014, the Company entered into a $133,000 5% Convertible Debenture with a non-related third party. Under the terms
of the Convertible Debenture, all principal and interest is due on February 27, 2015. The convertible debenture is convertible
at any time at the third party’s option into shares of the Company’s common stock at a variable conversion price of
55% of the lowest traded price during the 15 days prior to the notice of conversion, subject to adjustment as described in the
convertible debenture. As at October 31, 2014, the Company has received $120,000 of principal, net of a discount of $13,000, and
has recorded interest of $1,187.
The
embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging.
The initial fair value of the conversion feature of $118,339 resulted in an additional discount to the note payable of $118,339.
During the six months ended October 31, 2014, the Company recorded accretion of $25,300 increasing the carrying value of the note
to $25,300.
The
Company incurred financing costs of $18,159 which consisted of $10,010 cash and 135,810 common shares with a fair value of $8,149
(Note 6). As at October 31, 2014, the Company had unamortized debt issuance costs of $14,705 which are being amortized over the
life of the note payable.
d) On
September 24, 2014, the Company entered into a $350,000 Convertible Note with a non-related third party. Under the terms of the
Convertible Note, the Company received $55,555 principal upon closing of the Note and the Company will receive the remaining principal
in one or more installments with a Maturity Date for the Note of September 25, 2016. The convertible debenture bears a one-time
interest charge of 12% provided that the principle sum is not repaid within 90 days from its effective date. The third party shall
have the right to convert any unpaid sums into common stock of the Company at the rate of the lesser of $0.10 per share or 60%
of the lowest trade reported in the 25 days prior to date of conversion, subject to adjustment as described in the note. As at
October 31, 2014, the Company has received $50,000 of principal, net of a discount of $5,555, and has recorded interest of $0.
The
embedded conversion option qualifies for derivative accounting and bifurcation under ASC 815-15 Derivatives and Hedging.
The initial fair value of the conversion feature of $73,811 resulted in an additional discount to the note payable of $50,000
and the reaming $23,811 was recognized as interest expense. During the six months ended October 31, 2014, the Company recorded
accretion of $10,907 increasing the carrying value of the note to $10,907.
The
Company incurred financing costs of $8,500 which consisted of $3,500 cash and 83,333 common shares with a fair value of $5,000
(Note 6). As at October 31, 2014, the Company had unamortized debt issuance costs of $6,831 which are being amortized over the
life of the note payable.
Principal value of convertible debentures | |
$ | 308,555 | |
Less: repayment of principal | |
| — | |
Less: discount related to fair value
of the embedded conversion feature | |
| (278,339 | ) |
Less: discount related to original
issue discount | |
| (28,555 | ) |
Add: amortization
of discount | |
| 58,745 | |
Carrying value at October 31, 2014 | |
$ | 60,406 | |
10.
Derivative Liabilities
The
embedded conversion options of the Company’s convertible debentures described in Note 9 contain conversion features that
qualify for embedded derivative classification. The fair value of these liabilities will be re-measured at the end of every reporting
period and the change in fair value will be reported in the statement of operations as a gain or loss on derivative liabilities.
The
table below sets forth a summary of changes in the fair value of the Company’s Level 3 financial liabilities:
| |
For
the six months ended October 31, 2014 |
Balance at the beginning
of period | |
$ | — | |
Fair
value of new derivative liabilities (embedded conversion option) | |
| 334,065 | |
Change
in fair value of derivative | |
| 32,517 | |
Balance at end
of period | |
$ | 366,582 | |
The
Company uses Level 3 inputs for its valuation methodology for the embedded conversion option liabilities as their fair values
were determined by using the Black-Scholes option pricing model based on various assumptions. The model incorporates the price
of a share of the Company’s common stock (as quoted on the Over the Counter Bulletin Board), volatility, risk free rate,
dividend rate and estimated life. Significant changes in any of these inputs in isolation would result in a significant change
in the fair value measurement. As required, these are classified based on the lowest level of input that is significant to the
fair value measurement. The following table shows the assumptions used in the calculations:
| |
Expected
Volatility | |
Risk-Free
Interest Rate | |
Expected
Dividend Yield | |
Expected
Life (in years) |
At Issuance | |
157%
- 182% | |
0.05%
- 0.56% | |
| 0 | % | |
0.50
- 2.00 |
At October 31, 2014 | |
136% - 190% | |
0.01% - 0.50% | |
| 0 | % | |
0.33 - 1.90 |
11.
Subsequent Events
On
November 18, 2014, the Company entered into two $78,750 8% Convertible Notes with a non-related third party. Under the terms of
the Convertible Notes, all principal and interest is due on November 18, 2015. The convertible debentures are convertible at any
time after 180 days of the date of closing into shares of the Company’s common stock at a variable conversion price of 60%
of the lowest traded price during the 20 days prior to the notice of conversion, subject to adjustment as described in the convertible
debenture.
Item
2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Forward-Looking
Statements
Certain
statements, other than purely historical information, including estimates, projections, statements relating to our business plans,
objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking
statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements generally are identified
by the words “believes,” “project,” “expects,” “anticipates,” “estimates,”
“intends,” “strategy,” “plan,” “may,” “will,” “would,”
“will be,” “will continue,” “will likely result,” and similar expressions. We intend such
forward-looking statements to be covered by the safe-harbor provisions for forward-looking statements contained in the Private
Securities Litigation Reform Act of 1995, and are including this statement for purposes of complying with those safe-harbor provisions.
Forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties which
may cause actual results to differ materially from the forward-looking statements. Our ability to predict results or the actual
effect of future plans or strategies is inherently uncertain. Factors which could have a material adverse affect on our operations
and future prospects on a consolidated basis include, but are not limited to: changes in economic conditions, legislative/regulatory
changes, availability of capital, interest rates, competition, and generally accepted accounting principles. These risks and uncertainties
should also be considered in evaluating forward-looking statements and undue reliance should not be placed on such statements.
We undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information,
future events or otherwise. Further information concerning our business, including additional factors that could materially affect
our financial results, is included herein and in our other filings with the SEC.
Company
Overview
We
have acquired an exclusive license from ME Resource Corp. (“MEC”), a Canadian publicly listed company that is creating
mobile and scalable Wellhead Micro-Refinery Units (MRUs) deployable close to the wellhead to process raw natural gas into liquid
fuels and clean power. As a result of the license with MEC, we are now in the business of distributing MRUs in the State of Texas
and from there into other geographical areas.
The
product is still under development, which is ongoing, and the first MRU is expected to occur within a year. Discussions are ongoing
to raise capital to begin construction of a commercial unit. There is no assurance that we will be able to raise the capital needed
to develop the first MRU. Our expectation is that we will obtain financing, chose a site for the MRU, and begin construction of
the unit in the third quarter . As such, we will not be able to realize any revenue from the sale of MRUs until the development
has completed and a commercialized product is ready for launch.
Our
plan is to assist the development of the MRUs and distribute them in our licensed territory. We hope to provide oil and gas producers
and operators in the State of Texas a solution to process otherwise wasted natural gas, including stranded, shut-in, flared and
vented gas and produce valued end-products including engineered fuel (diesel, diluents, synthetic crude) and electrical power.
The MRU is a novel method and apparatus, for producing chemicals, heat, energy and water from a methane-containing gas. The innovative
method and apparatus makes use of heterogeneous catalysis in a single-vessel, beginning with the partial oxidation of methane
to produce synthesis gas followed by a Fischer-Tropsch reaction to produce chemicals and other end products with no excess hydrogen.
Under
our license agreement, we agreed to pay MEC $400,000 for our exclusive license, which money will go toward the unit cost of an
MRU at $800,000 or, alternatively, a revenue sharing arrangement where MEC leases the MRU at 50% unit cost and shares in 50% of
the net revenue generated. In either event, this money will be applied to the technical and engineering development of the first
demonstration MRU in the territory and may be used to develop catalyst for specific engineered fuels.
The
payment to MEC was due in two installments: i) $100,000 within thirty (30) days of January 29, 2014; and ii) balance of $300,000
within ninety (90) days of January 29, 2014. We have made total cash payments of $375,000. The remaining balance of $25,000 has
not been paid as of the date of this report.
On
August 31, 2014, we entered into an Exclusive License for Additional Territories (the “Additional License”) with MEC.
Under the Additional License, MEC appointed us as its exclusive distributor for the additional state of Montana. The Additional
License is considered an amendment to the License Agreement and will be considered under the same terms as the license agreement.
Under
the Additional License, we agreed to pay MEC a non-refundable license payment of $250,000, which is due 60 days after invoice .
The license fee will be used towards the engineering and deployment of a full-scale pilot project in the territory, and after
the successful demonstration of the pilot project we will have earned its exclusive right to distribute the MRU in the State of
Montana.
The
agreement calls for a prototype MRU that is expected to be skid mounted (transportable) and have the ability to process a maximum
of 100 MCF/day of natural gas into stable liquid hydrocarbons (synthetic fuels) and process gas for power. The prototype MRU will
be developed into a full-scale pilot project and will be used for research and development purposes. The total price of the prototype
MRU will be $1,200,000 with a 30% deposit due upon acceptance of the purchase order and issuance of invoice by MEC. With this
agreement in place we have reserved the opportunity to work with incumbent Oil and Gas landowners and operators showcasing the
prototype.
The
prototype MRU will differ from the commercial MRUs that will be deployed in the Territory. The prototype MRU will be used for
ongoing Research and Development and thus increased engineering costs will be incurred. The plan is to set up a prototype unit
in the Montana territory due to the number of inquiries we have been receiving. As such, we will need to raise money for the costs
associated with the prototype MRU and we will share the cost with MEC and the operator.
Results
of Operations for the Three and Six Months Ended October 31, 2014 and 2013
We
generated no revenue for the three and six months ended October 31, 2014 and 2013. We do not anticipate earnings revenues until
we are able to distribute the MRUs under our license with MEC.
Our
operating expenses during the three months ended October 31, 2014 were $488,570, compared with $2,000 for the same period ended
October 31, 2013. Our operating expenses during the three months ended October 31, 2014 consisted mainly of professional and consulting
fees of $138,114 and general and administrative fees of $350,456.
Our
operating expenses during the six months ended October 31, 2014 were $697,216, compared with $4,000 for the same period ended
October 31, 2013. Our operating expenses during the six months ended October 31, 2014 consisted mainly of professional and consulting
fees of $302,338 and general and administrative fees of $394,878.
We
anticipate our operating expenses will increase as we undertake our plan of operations. The increase will be attributable to the
continued development of the MRUs, consulting fees to our management, general and administrative expenses and the professional
fees associated with our reporting obligations under the Securities Exchange Act of 1934.
We
incurred other expenses of $151,612 for the three months ended October 31, 2014 mostly from interest expense, compared with $0
in other expenses for the three months ended October 31, 2013.
We
incurred other expenses of $152,582 for the six months ended October 31, 2014 mostly from interest expense, compared with $0 in
other expenses for the six months ended October 31, 2013.
We
recorded a net loss of $640,182 for the three months ended October 31, 2014, compared with a net loss of $2,000 for the three
months ended October 31, 2013.
We
recorded a net loss of $849,798 for the six months ended October 31, 2014, compared with a net loss of $4,000 for the six months
ended October 31, 2013.
Liquidity
and Capital Resources
As
of October 31, 2014, we had total current assets of $86,271. We had $1,590,576 in current liabilities as of October 31, 2014.
Thus, we had a working capital deficit of $1,504,305 as of October 31, 2014.
Operating
activities used $548,273 in cash for the six months ended October 31, 2014. Our net loss of $817,298 and a $148,633 decrease in
accounts payable and accrued liabilities mainly accounted for our negative operating cash flow.
Financing
activities during the six months ended October 31, 2014 generated $580,581 in cash, represented by $250,000 in proceeds from the
sale of our stock, $259,490 in net proceeds from the issuance of convertible debt and $71,091 in net advances from related parties.
We
have entered into a number of loan agreements in an effort to provide needed financing. From July 25, 2014 to the present, those
loans and their terms are detailed in our footnotes to our financial statements included herein, and our Current Reports on Form
8-K that we filed with the SEC on August 27, 2014 and November 24, 2014, which are incorporated herein by reference.
Despite
the financing received, we have insufficient cash to operate our business at the current level for the next twelve months and
insufficient cash to achieve our business goals. The success of our business plan beyond the next 12 months is contingent upon
us obtaining additional financing. We intend to fund operations through debt and/or equity financing arrangements, which may be
insufficient to fund our capital expenditures, working capital, or other cash requirements. We do not have any formal commitments
or arrangements for the sales of stock or the advancement or loan of funds at this time. There can be no assurance that such additional
financing will be available to us on acceptable terms, or at all.
Off
Balance Sheet Arrangements
As
of October 31, 2014, there were no off balance sheet arrangements.
Going
Concern
We
have incurred losses since inception, have negative working capital, and have not yet received revenues from sales of products
or services. These factors create substantial doubt about our ability to continue as a going concern. The financial statements
do not include any adjustment that might be necessary if we are unable to continue as a going concern.
Our
ability to continue as a going concern is dependent on generating cash from the sale of our common stock and/or obtaining debt
financing and attaining future profitable operations. Management’s plans include selling our equity securities and obtaining
debt financing to fund our capital requirement and ongoing operations; however, there can be no assurance we will be successful
in these efforts.
Item
3. Quantitative and Qualitative Disclosures About Market Risk
A
smaller reporting company is not required to provide the information required by this Item.
Item
4. Controls and Procedures
Disclosure
Controls and Procedures
We
carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of October 31, 2014. This evaluation was carried out under the supervision and
with the participation of our Chief Executive Officer and our Chief Financial Officer. Based upon that evaluation, our Chief Executive
Officer and Chief Financial Officer concluded that, as of October 31, 2014, our disclosure controls and procedures were not effective
due to the presence of material weaknesses in internal control over financial reporting.
A
material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there
is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not
be prevented or detected on a timely basis. Management has identified the following material weaknesses which have caused management
to conclude that, as of October 31, 2014, our disclosure controls and procedures were not effective: (i) inadequate segregation
of duties and effective risk assessment; and (ii) insufficient written policies and procedures for accounting and financial reporting
with respect to the requirements and application of both US GAAP and SEC guidelines.
Remediation
Plan to Address the Material Weaknesses in Internal Control over Financial Reporting
Our
company plans to take steps to enhance and improve the design of our internal controls over financial reporting. During the period
covered by this quarterly report on Form 10-Q, we have not been able to remediate the material weaknesses identified above. To
remediate such weaknesses, we plan to implement the following changes during our fiscal year ending April 30, 2015: (i) appoint
additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and (ii) adopt sufficient
written policies and procedures for accounting and financial reporting. The remediation efforts set out are largely dependent
upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing
such funds, remediation efforts may be adversely affected in a material manner.
Changes
in Internal Control over Financial Reporting
There
were no changes in our internal control over financial reporting during the three months ended October 31, 2014 that have materially
affected, or are reasonable likely to materially affect, our internal control over financial reporting.
PART
II – OTHER INFORMATION
Item
1. Legal Proceedings
We
are not a party to any pending legal proceeding. We are not aware of any pending legal proceeding to which any of our officers,
directors, or any beneficial holders of 5% or more of our voting securities are adverse to us or have a material interest adverse
to us.
Item
1A: Risk Factors
A
smaller reporting company is not required to provide the information required by this Item.
Item
2. Unregistered Sales of Equity Securities and Use of Proceeds
On
August 6, 2014, we entered into a $275,000 10% Convertible Promissory Note with a non-related third party. On August 6, 2014,
we issued 187,720 common shares with a fair value of $11,263, for financing costs relating to the issuance of the Note.
On
August 21, 2014, we entered into a $133,000 5% Convertible Debenture with a non-related third party. On August 21, 2014, we issued
135,810 common shares with a fair value of $8,149, for financing costs relating to the issuance of Note.
On
August 26, 2014, we entered into an Equity Purchase Agreement and Registration Rights Agreement with Premier Venture Partners,
LLC (“Premier”) whereby Premier is obligated, providing we have met certain conditions including the filing of a Form
S-1 Registration Statement for the shares to be acquired, to purchase up to $10,000,000 of our common stock at the rates set forth
in the Equity Purchase Agreement. On September 5, 2014, we issued 3,955,070 common shares with a fair value of $279,855 to Premier.
On
September 24, 2014, we entered into a $350,000 Convertible Note with a non-related third party. On September 24, 2014, we issued
83,333 common shares with a fair value of $5,000, for financing costs relating to the issuance of Note.
As
at October 31, 2014, pursuant to a consulting agreement, we are obligated to issue 93,719 common shares with a fair value of $30,235,
which has been recorded as stock payable.
These
securities were issued pursuant to Section 4(2) of the Securities Act and/or Rule 506 promulgated thereunder. The holders represented
their intention to acquire the securities for investment only and not with a view towards distribution. The investors were given
adequate information about us to make an informed investment decision. We did not engage in any general solicitation or advertising.
We directed our transfer agent to issue the stock certificates with the appropriate restrictive legend affixed to the restricted
stock.
Item
3. Defaults upon Senior Securities
None
Item
4. Mine Safety Disclosures
Not
applicable
Item
5. Other Information
None
Item
6. Exhibits
SIGNATURES
In
accordance with the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
|
Well
Power, Inc. |
|
|
Date:
|
December
22, 2014 |
|
|
|
/s/
Cristian Neagoe |
|
By:
Cristian Neagoe
Cristian
Neagoe
Title:
Chief Executive Officer and Director |
CERTIFICATIONS
I, Cristian Neagoe, certify that;
1. |
|
I have reviewed this quarterly report on Form 10-Q for the quarter ended October 31, 2014 of Well Power, Inc. (the “registrant”); |
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 registrant as of, and for, the periods presented in this report; |
4. |
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. |
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, 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. |
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. |
|
Evaluated the effectiveness of the registrant’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 |
d. |
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. |
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a. |
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’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 registrant’s internal control over financial reporting. |
Date: December 22, 2014
/s/ Cristian Neagoe
By: Cristian Neagoe
Title: Chief Executive Officer
CERTIFICATIONS
I, Dan Patience, certify that;
1. |
|
I have reviewed this quarterly report on Form 10-Q for the quarter ended October 31, 2014 of Well Power, Inc. (the “registrant”); |
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 registrant as of, and for, the periods presented in this report; |
4. |
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. |
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, 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. |
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. |
|
Evaluated the effectiveness of the registrant’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 |
d. |
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. |
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
a. |
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’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 registrant’s internal control over financial reporting. |
Date: December 22, 2014
/s/ Dan Patience
By: Dan Patience
Title: Chief Financial Officer
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
AND
CHIEF FINANCIAL OFFICER
PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF
2002
In connection with the quarterly
Report of Well Power, Inc. (the “Company”) on Form 10-Q for the quarter ended October 31, 2014 filed with the
Securities and Exchange Commission (the “Report”), I, Cristian Neagoe, Chief Executive Officer of the Company,
and I, Dan Patience, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002, that:
| 1. | The Report fully complies with the requirements of Section 13(a)
of the Securities Exchange Act of 1934; and |
| 2. | The information contained in the Report fairly presents, in all material
respects, the consolidated financial condition of the Company as of the dates presented and the consolidated result of operations
of the Company for the periods presented. |
By: |
/s/ Cristian Neagoe |
Name: |
Cristian Neagoe |
Title: |
Principal Executive Officer and Director |
Date: |
December 22, 2014 |
By: |
/s/ Dan Patience |
Name: |
Dan Patience |
Title: |
Principal Financial Officer and Director |
Date: |
December 22, 2014 |
This certification has been furnished solely pursuant to Section
906 of the Sarbanes-Oxley Act of 2002.