Attached files
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EX-23.1 - WPS - 10-Q - 9/30/09 AUDITOR CONSENT - WPS, Inc. | wps-10q93009consent.htm |
EX-32.1 - WPS - 10-Q - 9/30/09 CEO 906 CERT - WPS, Inc. | wps10q93009-960cert.htm |
EX-31.1 - WPS - 10-Q - 9/30/09 CEO 302 CERT - WPS, Inc. | wps10q93009-302ceocert.htm |
________________________________________________________________________________________________________________________________________________________________________________________________________
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
___________________________
FORM
10-Q
___________________________
(Mark
One)
x
|
QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For the
quarterly period ended September 30,
2009
OR
¨
|
TRANSACTION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
|
For the
transition period
from ___________________________ to ___________________________
Commission
file number: 333-161454
WPS,
INC.
_______________________________________________________________________________________________________________________________________________________________________________________________________
(Exact
Name of Registrant as Specified in Its Charter)
Nevada
|
36-4645325
|
|
(State of Other Jurisdiction of Incorporation or
Organization)
|
(I.R.S. Employer Identification Number)
|
|
525
W. Allen Ave., Unit 9
San
Dimas, CA
|
91773
|
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
(909)
599-9415
______________________________________________________________________________________________________________________________________________________________________________________________________
(Registrant’s
Telephone Number, Including Area Code)
Not
Applicable
______________________________________________________________________________________________________________________________________________________________________________________________________
(Former
Name, Former Address and Former Fiscal Year, If Changed Since Last
Report)
Copies
to:
R.
Brumbaugh
417 W.
Foothill Blvd.
Suite
B-175
Glendora,
CA 91741
nbdc@onebox.com
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 registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. Yes x 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 (§232.405 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 ¨ No o
Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer,”
"non-accelerated filer" and “smaller reporting company” in Rule 12b-2 of
the Exchange Act. (Check one):
Large
accelerated filer
|
o
|
Accelerated
filer
|
o
|
Non-accelerated
filer
|
o
|
Smaller
reporting company
|
x
|
Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes x
No
Indicate
the number of shares outstanding of each of the registrant’s classes of common
stock, as of the latest practicable date:
As of
September 30, 2009, there were 2,150,000 shares of common stock, par value
$0.001 per share, outstanding and no shares of preferred stock
outstanding.
1
TABLE OF
CONTENTS
Page
|
||
PART
I – FINANCIAL INFORMATION
|
||
Item
1.
|
Financial
Statements
|
3
|
Item
2.
|
Management’s
Discussion and Analysis of Financial Condition and Plan
of Operations
|
9
|
Item
3.
|
Quantitative
and Qualitative Disclosures About Market Risk
|
12
|
Item
4.
|
Controls
and Procedures
|
12
|
|
|
|
PART
II – OTHER INFORMATION
|
13
|
|
Item
1.
|
Legal
Proceedings
|
13
|
Item
1A.
|
Risk
Factors
|
13
|
Item
2.
|
Unregistered
Sale of Equity Securities and Use of Proceeds
|
15
|
Item
3.
|
Defaults
Upon Senior Securities
|
15
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
15
|
Item
5.
|
Other
Information
|
15
|
Item
6.
|
Exhibits
|
15
|
SIGNATURES
|
15
|
|
CERTIFICATIONS
Exhibit
23.1 Consent of Independent Registered Public Accounting
Firm
|
||
Exhibit
31.1 Management Certification
|
Exhibit
32.2 Sarbanes-Oxley Act
|
2
PART
I
FINANCIAL
INFORMATION
Item
1. Financial Statements.
OFFICES
OF
ARSHAD
M. FAROOQ, JD, CPA
201
N. Palomares St.
Pomona,
CA 91767
(909)
238-5361
(909)
972-1672 Fax
amfarooq@gmail.com
______________________________________________________________________________________
REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM
To the
Board of Directors
WPS,
Inc.
San
Dimas, CA
We have
reviewed the accompanying balance sheet of WPS, Inc. (A development Stage
Company) as of September 30, 2009, and the related statements of operations,
stockholders’ equity, and cash flows for the three-month period ended September
30, 2009. These financial statements are the responsibility of the Company’s
management.
We
conducted our review in accordance with standards of the Public Company
Accounting Oversight Board (United States). A review of interim financial
information consists principally of applying analytical procedures and making
inquiries of persons responsible for financial and accounting matters. It is
substantially less in scope than an audit conducted in accordance with standards
of the Public Company Accounting Oversight Board (United States), the objective
of which is the expression of an opinion regarding the financial statements
taken as a whole. Accordingly, we do not express such an opinion.
Based on
our review, we are not aware of any material modifications that should be made
to the accompanying interim financial statements for them to be in conformity
with accounting principles generally accepted in the United States of
America.
The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. As discussed in Note 2 to the financial
statements, the Company’s lack of revenue and significant losses as of September
30, 2009 raises substantial doubt about its ability to continue as a going
concern. The financial statements do not include any adjustments that might
result from the outcome of this uncertainty.
/s/ Arshad M. Farooq
Arshad M.
Farooq
Pomona,
CA
November
10, 2009
3
WPS,
Inc.
|
|
(A
DEVELOPMENT STAGE COMPANY)
|
|
BALANCE
SHEET
|
|
As
of 9/30/2009
|
|
Current
Assets
|
|
Cash
|
$601
|
Total
Current Assets
|
601
|
TOTAL
ASSETS
|
601
|
LIABILITIES
& STOCKHOLDER'S EQUITY
|
|
Current
Liabilities
|
|
Accounts
payable
|
|
Note
Payable to Related Party
|
4,533
|
Total
Current Liabilities
|
$4,533
|
STOCKHOLDERS
EQUITY
|
|
Preferred
stock: $0.001 par value, 5,000,000 shares
|
|
authorized:
no shares issued and outstanding
|
|
Common
stock: $0.001 par value, 70,000,000 shares
|
|
authorized;
2,150,000 shares issued and outstanding
|
2,150
|
Additional
paid-in capital
|
289
|
Accumulated
deficit:
|
(6,371)
|
TOTAL
STOCKHOLDERS EQUITY
|
(3,932)
|
TOTAL
LIABILITIES & STOCKHOLDER'S EQUITY
|
$601
|
The
accompanying notes are an integral part of these financial
statements
4
WPS,
Inc.
|
|||||||
(A
DEVELOPMENT STAGE COMPANY)
|
|||||||
STATEMENTS
OF OPERATIONS
|
|||||||
For
the
|
For
the
|
Inception
|
|||||
Three
Months
|
Nine
Months
|
17-Nov-08
|
|||||
Ended
|
Ended
|
||||||
30-Sep
|
30-Sep
|
through
|
|||||
2009
|
2009
|
30-Sep-09
|
|||||
REVENUES:
|
$ 581
|
$ 923
|
922
|
||||
Cost
of Sales
|
$ (188)
|
$ (468)
|
(467)
|
||||
Gross
Profit
|
$ 393
|
$ 455
|
$ 455
|
||||
OPERATING
EXPENSES:
|
|||||||
General
& Administrative
|
2,574
|
4,676
|
6,826
|
||||
TOTAL
EXPENSES
|
$2,574
|
$4,676
|
$6,826
|
||||
Income
(Loss) before income taxes
|
(2,181)
|
(4,221)
|
(6,371)
|
||||
Provision
for income taxes
|
-
|
-
|
-
|
||||
NET
INCOME (LOSS)
|
($2,181)
|
($4,221)
|
($6,371)
|
||||
Basic
and diluted loss per share
|
$0.00
|
$0.00
|
|||||
Weighted
average common
|
|||||||
shares
outstanding
|
2,150,000
|
2,150,000
|
The
accompanying notes are an integral part of these financial
statements
5
WPS,
Inc.
|
||||||||||
(A
development Stage Company)
|
||||||||||
Statements
of Stockholder's Equity
|
||||||||||
30-Sep-09
|
||||||||||
Additional
|
||||||||||
Common
Stock
|
Paid-In
|
Accumulated
|
||||||||
Shares
|
Amount
|
Capital
|
Deficit
|
Total
|
||||||
BALANCE,
November 17, 2008
|
-
|
$ -
|
$ -
|
$ -
|
$0
|
|||||
Sale
of common stock
|
150,000
|
150
|
-
|
150
|
||||||
Common
stock issued to the Founder
|
2,000,000
|
2,000.00
|
2,000
|
|||||||
Net
(loss) for the Period
|
||||||||||
ended
December 31, 2008
|
-
|
-
|
-
|
(2,150)
|
(2,150)
|
|||||
Balance,
December 31, 2008
|
2,150,000
|
2,150
|
-
|
(2,150)
|
-
|
|||||
Contributed
Capital
|
289
|
289
|
||||||||
(4,221)
|
(4,221)
|
|||||||||
Balance,
December 31, 2008
|
2,150,000
|
$2,150
|
$289
|
($6,371)
|
($3,932)
|
The
accompanying notes are an integral part of these financial
statements
6
WPS,
Inc.
(A
DEVELOPMENT STAGE COMPANY)
|
|||||
CASH
FLOW STATEMENT
|
|||||
Inception
|
|||||
Period
Ended
|
17-Nov-08
|
||||
30-Sep
|
through
|
||||
2009
|
30-Sep-09
|
||||
Cash
flows from operating activities:
|
|||||
Net
loss
|
($4,221)
|
($6,371)
|
|||
Adjustments
to reconcile net loss to net
|
|||||
cash
used in operating activities:
|
|||||
Common
Stock issued for services
|
2,150
|
||||
|
|||||
Changes
in current assets and liabilities:
|
|||||
Receivables
|
-
|
||||
Payables
|
-
|
-
|
|||
Other
|
-
|
||||
Net
cash (used in) operating activities
|
(4,221)
|
(4,221)
|
|||
Net
cash provided by investing activities
|
-
|
-
|
|||
Cash
flows from financing activities:
|
|||||
Sale
of common stock
|
-
|
||||
Issuance
of common stock
|
-
|
||||
Additional
Paid In Capital
|
289
|
289
|
|||
Changes
in Accounts Payable
|
4,533
|
4,533
|
|||
Net
cash provided by financing activities
|
4,822
|
4,822
|
|||
Net
increase (decrease) in cash and equivalents
|
601
|
601
|
|||
Cash
and equivalents at beginning of period
|
-
|
||||
Cash
and equivalents at end of period
|
$601
|
$601
|
The
accompanying notes are an integral part of these financial
statements
7
WPS,
Inc.
|
(A
Development Stage Company)
|
Statements
of Stockholder's Equity
|
30-Sep-09
|
NOTE
1 - CONDENSED FINANCIAL STATEMENTS
The
accompanying financial statements have been prepared by the Company without
audit. In the opinion of management, all adjustments (which include
only normal recurring adjustments) necessary to present fairly the financial
position, results of operations, and cash flows at September 30, 2009, and for
all periods presented herein, have been made.
Certain
information and footnote disclosures normally included in financial statements
prepared in accordance with accounting principles generally accepted in the
United States of America have been condensed or omitted. It is
suggested that these condensed financial statements be read in conjunction with
the financial statements and notes thereto included in the Company's December
31, 2008 audited financial statements. The results of operations for
the periods ended September 30, 2009 are not necessarily indicative of the
operating results for a full year.
NOTE
2 - GOING CONCERN
The
Company's financial statements are prepared using generally accepted accounting
principles in the United States of America applicable to a going concern which
contemplates the realization of assets and liquidation of liabilities in the
normal course of business. The Company has not yet established an ongoing source
of revenues sufficient to cover its operating costs and allow it to continue as
a going concern. The ability of the Company to continue as a going concern is
dependent on the Company obtaining adequate capital to fund operating losses
until it becomes profitable. If the Company is unable to obtain adequate
capital, it could be forced to cease operations.
In order
to continue as a going concern, the Company will need, among other things,
additional capital resources. Management's plan is to obtain such resources for
the Company by obtaining capital from management and significant shareholders
sufficient to meet its minimal operating expenses and seeking equity and/or debt
financing. However management cannot provide any assurances that the Company
will be successful in accomplishing any of its plans.
The
ability of the Company to continue as a going concern is dependent upon its
ability to successfully accomplish the plans described in the preceding
paragraph and eventually secure other sources of financing and attain profitable
operations. The accompanying financial statements do not include any adjustments
that might be necessary if the Company is unable to continue as a going
concern.
NOTE
3 – SIGNIFICANT ACCOUNTING POLICIES
Use of
Estimates
The
preparation of financial statements in conformity with 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. Actual results could differ from those
estimates.
Recent Accounting
Pronouncements
In May
2009, the FASB issued FAS 165, “Subsequent Events”. This
pronouncement establishes standards for accounting for and disclosing subsequent
events (events which occur after the balance sheet date but before financial
statements are issued or are available to be issued). FAS 165
requires an entity to disclose the date subsequent events were evaluated and
whether that evaluation took place on the date financial statements were issued
or were available to be issued. It is effective for interim and
annual periods ending after June 15, 2009. The adoption of FAS 165
did not have a material impact on the Company’s financial condition or results
of operation.
In June
2009, the FASB issued FAS 166, “Accounting for Transfers of Financial Assets”,
an amendment of FAS 140. FAS 140 is intended to improve the
relevance, representational faithfulness, and comparability of the information
that a reporting entity provides in its financial statements about a transfer of
financial assets, the effects of a transfer on its financial position, financial
performance and cash flows, and a transferor’s continuing involvement, if any,
in transferred financial assets. This statement must be applied as of
the beginning of each reporting entity’s first annual reporting period that
begins after November 15, 2009. The Company does not expect the
adoption of FAS 166 to have an impact on the Company’s results of operations,
financial condition or cash flows.
In June
2009, the FASB issued FAS 167, “Amendments to FASB Interpretation No.
46(R)”. FAS 167 is intended to (1) address the effects on certain
provisions of FASB Interpretation No. 46 (revised December 2003), Consolidation of Variable Interest
Entities, as a result of the elimination of the qualifying
special-purpose entity concept in FAS 166, and (2) constituent concerns about
the application of certain key provisions of Interpretation 46(R), including
those in which the accounting and disclosures under the Interpretation do not
always provided timely and useful information about an enterprise’s involvement
in a variable under the Interpretation do not always provided timely and useful
information about an enterprise’s involvement in a variable interest
entity. This statement must be applied as of the beginning of each
reporting entity’s first annual reporting period that begins after November 15,
2009. The Company does not expect the adoption of FAS 167 to have an
impact on the Company’s results of operations, financial condition or cash
flows.
In June
2009, the FASB issued FAS 168, “The FASB Accounting Standards Codification and
the Hierarchy of Generally Accepted Accounting Principles”. FAS 168
will become the source of authoritative U.S. generally accepted accounting
principles (GAAP) recognized by the FASB to be applied by nongovernmental
entities. Rules and interpretive releases of the Securities and
Exchange Commission (SEC) under authority of federal securities laws are also
sources of authoritative GAPP for SEC registrants. On the effective
date of this Statement, the Codification will supersede all then-existing
non-SEC accounting and reporting standards. All other
non-grandfathered non-SEC accounting literature not included in the Codification
will become non-authoritative. This statement is effective for
financial statements issued for interim and annual periods ending after
September 15, 2009. The Company does not expect the adoption of FAS
168 to have an impact on the Company’s results of operations, financial
condition or cash flows.
Item
2. Management’s Discussion and Analysis of Financial Condition and
Results of Operations.
8
The
following discussion of our financial condition and results of operations should
be read in conjunction with our financial statements and the related notes, and
the other financial information included in this report.
Forward-Looking
Statements
The following discussion and
analysis should be read in conjunction with our consolidated financial
statements and related notes thereto, included elsewhere in this registration
statement. Portions of this document that are not statements of
historical or current fact are forward-looking statements that involve risk and
uncertainties, such as statements of our plans, objectives, expectations and
intentions. The cautionary statements made in this registration
statement should be read as applying to all related forward-looking statements
wherever they appear in this registration statement. From time to
time, we may publish forward-looking statements relative to such matters as
anticipated financial performance, business prospects, technological
developments and similar matters. The Private Securities Litigation
Reform Act of 1995 provides a safe harbor for forward-looking
statements. All statements other than statements of historical fact
included in this section or elsewhere in this report are, or may be deemed to
be, forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934. Important factors that could cause actual results to differ
materially from those discussed in such forward-looking statements include, but
are not limited to, the following: changes in the economy or in specific
customer industry sectors; changes in customer procurement policies and
practices; changes in product manufacturer sales policies and practices; the
availability of product and labor; changes in operating expenses; the effect of
price increases or decreases; the variability and timing of business
opportunities including acquisitions, alliances, customer agreements and
supplier authorizations; our ability to realize the anticipated benefits of
acquisitions and other business strategies; the incurrence of debt and
contingent liabilities in connection with acquisitions; changes in accounting
policies and practices; the effect of organizational changes within the Company;
the emergence of new competitors, including firms with greater financial
resources than ours; adverse federal, state and/or local legislation and/or
regulation; and the occurrence of extraordinary events, including natural events
such as earthquakes, fires and floods, accidents and Acts of
God. We
undertake no obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events, or
otherwise.
Forward-looking
statements involve risks, uncertainties and other factors, which may cause our
actual results, performance or achievements to be materially different from
those expressed or implied by such forward-looking
statements. Factors and risks that could affect our results and
achievements and cause them to materially differ from those contained in the
forward-looking statements include those previously identified in prior SEC
filings, as well as other factors that we are currently unable to identify or
quantify, but that may exist in the future.
Readers
are cautioned not to place undue reliance on any forward-looking statements
contained herein, which reflect management’s opinions only as of the date
hereof. Except as required by law, we undertake no obligation to
revise or publicly release the results of any revision to any forward-looking
statements. You are advised, however, to consult any additional
disclosures we make in our reports to the SEC. All subsequent written
and oral forward-looking statements attributable to us or persons acting on our
behalf are expressly qualified in their entirety by the cautionary statements
contained in this Report.
Overview
WPS, Inc.
("WPS," the "Company,” “we,” “us” and similar terms) was incorporated in
Nevada on November 17, 2008. The Company does not have any
subsidiaries. WPS, Inc. is a Nevada corporation and developmental
stage company with a principal business objective of providing competitively
priced, premium quality commercial grade fasteners made from a variety of
materials, including but not limited to steel, stainless steel, brass and
nylon. In addition, WPS can provide to its customers pipe and pipe
fittings in galvanized, black iron, stainless steel and brass, electrical
products such as tape, terminals, connectors and fuses, and tools, nylon cable
ties, drills and drill bits. The primary goal of WPS is to achieve a
consistent, optimum balance of quality and price with industry leading customer
service provided by knowledgeable and dedicated sale associates. From
a strategic standpoint, the intent of WPS is to expand its name recognition and
build brand recognition with a consistent marketing campaign, a comprehensive
website presence, building close ties with critical suppliers, membership and
participation in business and professional associations and to take advantage of
networking opportunities that will enhance our market share. Our
company commitment is to lead our industry with the highest quality product and
customer support.
9
We are a
small, start-up company that lacks a stable customer base. Since our
inception on November 17, 2008 to the present, we have generated only nominal
revenues. We believe that the funds expected to be received from the
maximum sale of our common equity will be sufficient to finance our efforts to
become operational and carry us through the next twelve (12)
months. We believe that the recurring revenues from sales that we
expect to generate in that time period will be sufficient to support ongoing
operations. Unfortunately, there can be no assurance that the actual
expenses incurred will not materially exceed our estimates or that cash
flows from sales will be adequate to maintain our business. As a
result, our independent auditors have expressed substantial doubt about our
ability to continue as a going concern. If we do not produce
sufficient cash flow to support our operations over the next 12 months, we may
need to raise additional capital by issuing capital stock in exchange for cash
in order to continue as a going concern. There are no formal or
informal agreements to obtain such financing. We cannot assure you
that any financing can be obtained or, if obtainable, that it will be on
reasonable or acceptable terms. Without securing additional capital,
it may be unlikely for us to stay in business.
The
Company is a “shell company.”
Competition
The
market for customers is intensely competitive and such competition is expected
to continue to increase. Generally, our actual and potential
competitors are individuals or small companies with longer operating histories,
greater financial and marketing resources, greater name recognition and an
entrenched client base. Therefore, many of these competitors may be
able to devote greater resources to attracting customers and may be able to
grant preferred pricing. Competition by existing and future
competitors could result in our inability to secure an adequate consumer base
sufficient enough to support our endeavors. We cannot be assured that
we will be able to compete successfully against present or future competitors or
that the competitive pressure we may face will not force us to cease
operations.
No formal
study has been commissioned or initiated to analyze the competition that the
Company will or may face. The Company’s management competition
analysis reveals that the fastener industry is a competitive business with
competition coming from locally owned hardware stores to major companies such as
Home Depot, Lowes and Ace Hardware. All of our competitors are
generally better financed, have greater name recognition and an established
customer loyalty base than we are. Our core philosophy of
reliability, fair price, and offering exceptional personal customer service will
distinguish our Company from the competition. Even with the
competitive nature of the business, there is an opportunity for the Company to
position itself for success by recognizing and catering to an increasingly
demanding customer.
Employees
WPS, Inc.
currently has one individual acting as the sole officer and director of the
Company. This individual allocates time and personal resources to the
Company on a part-time basis.
Recent
Developments
None
Results
of Operations
Three
Months Ended September 30, 2009
Revenues
were approximately $581. There were no sales to compare for the three
months ended September 30, 2008 as the Company was not in existence at that
time. We believe these sale revenues reflect the competitive nature we are
seeing due to our competitors and the downturn in the economy. We
continue to work with our standing customer base, as well attempting to create
new business relationships, to help weather the economic downturn.
Gross
profit was approximately $393 for the three months ended September 30,
2009. There were no sales to compare for the three months ended
September 30, 2008 as the Company was not in existence at that
time.
General
and administrative expenses were approximately $2,574 for the three months ended
September 30, 2009. There were no general or administrative expenses
to compare for the three months ended September 30, 2008 as the Company was not
in existence at that time.
The
Company has a net income loss for the three month period ended September 30,
2009 of approximately $2,181.
10
Nine
Months Ended September 30, 2009
Revenues
were approximately $923. There were no sales to compare for the three
months ended September 30, 2008 as the Company was not in existence at that
time. We believe these sale revenues reflect the competitive nature we are
seeing due to our competitors and the downturn in the economy. We
continue to work with our standing customer base, as well as attempting to
create new business relationships, to help weather the economic
downturn.
Gross
profit was approximately $455 for the nine months ended September 30,
2009. There were no sales to compare for the nine months ended
September 30, 2008 as the Company was not in existence at that
time.
General
and administrative expenses were approximately $4,676 for the nine months ended
September 30, 2009. There were no general or administrative expenses
to compare for the nine months ended September 30, 2008 as the Company was not
in existence at that time.
The
Company has a net income loss for the nine month period ended September 30, 2009
of approximately $4,221.
Liquidity
and Capital Resources
Liquidity
For the
nine months ended September 30, 2009, we experienced a net loss of approximately
$4,221. On September 30, 2009, we had approximately $601 in
cash. Accounts receivable, net of allowances for doubtful accounts,
were approximately $0.00.
Our
liquidity and capital resource planning is largely dependent on the generation
of operating cash flows, which is highly sensitive to changes in demand in the
market place and the general economic downturn. Our principal
liquidity requirements are to finance current operations and fund future
expansion. Currently, our primary source of liquidity to meet these
needs is the cash generated by operations.
Cash
Flow
For the
three months ended September 30, 2009, we had negative cash flow from operations
of approximately $2,181. For the nine months ended September 30,
2009, we had negative cash flow from operations of approximately
$4,221. There were no comparable figures to compare for the three
months and nine months ended September 30, 2008 as the Company was not in
existence at that time. This negative cash flow is primarily due to
the start-up nature of our business and the general economic
downturn.
There
were no investment activities for either the three month or the nine month
periods ending September 30, 2009.
There
were no financing activities for either the three month or the nine month
periods ending September 30, 2009.
Capital
Resources
Line
of Credit
The
Company does not have any line of credit nor does it anticipate applying for
any. However, should the current financial condition of the Company
prove to be insufficient for the Company’s future requirements, the Company is
willing to attempt entry into the capital markets to raise the necessary capital
to meet its needs.
Long
Term Notes
The
Company does not have any long term notes and does not anticipate acquiring
any.
Critical
Accounting Estimates and Recently Issued Accounting Standards
Please
refer to the Notes to the financial statements.
11
Inflation
In the
opinion of management, inflation will not have any material impact on the
Company’s financial condition and results of its operations.
Off-Balance
Sheet Arrangements
We do not
have any off balance sheet arrangements that have or are reasonably likely to
have a current or future effect on our financial condition, revenues or
expenses, results of operations, liquidity, capital expenditures or capital
resources that could reasonably be foreseen as material to any investor in our
securities.
Seasonality
Our
operating results are generally not materially affected by
seasonality.
Other
Considerations
There are
numerous factors that impact or that can potentially impact our business and
results of our operations. Sources of these factors include general
economic and business conditions, federal, state and local regulation of
business activities, the level of demand for product or services, the level and
intensity of competition, the ability to develop new services and products based
on new or evolving technology and the market’s acceptance of those new services
or products, our ability to timely and effectively manage periodic product
transitions, customer and geographic sales mix of any particular period, and our
ability to continue to improve our infrastructure including personnel and
systems to keep pace with our anticipated growth.
Additional
Information
We file
reports and other materials with the Securities and Exchange
Commission. These documents may be inspected and copied at the
Commission’s Public Reference Room located at 100 F Street, N.E., Washington,
D.C. 20549. The public may obtain information on the operation of the
Public Reference Room by calling the Commission at
1-800-SEC-0330. The Commission maintains a web site at http://www.sec.gov
that contains reports, proxy and information statements and other information
regarding issuers that file electronically with the Commission.
We do not
hold any derivative instruments and do not engage in any hedging
activities.
Item
4. Controls and Procedures.
Disclosure
controls and procedures are controls and procedures that are designed to ensure
that information required to be disclosed by us in the reports that we file or
submit under the Exchange Act is recorded, processed, summarized and reported,
within the time periods specified in the Securities and Exchange Commission’s
rules, regulations and forms. Disclosure controls and procedures
include, without limitation, controls and procedures designed to ensure that
information required to be disclosed by us in the reports that we file under the
Exchange Act is accumulated and communicated to our management, including our
principal executive and financial officers, as appropriate, to allow timely
decisions regarding required disclosure.
Evaluation
of Controls and Procedures
In
accordance with Securities Exchange Act of 1934, Rules 13a-15(e) and 15d-15(e),
our management is required to perform an evaluation under the supervision and
with the participation of the Company’s management, including the Company’s
principal executive officer and principal financial officer, of the
effectiveness of the design and operation of the Company’s disclosure controls
and procedures as of the end of the period. Based on that evaluation,
our management concluded that our disclosure controls and procedures were
effective in ensuring that the information required to be filed or submitted
under the Exchange Act is accumulated and communicated to our management, as
appropriate, to allow timely decisions regarding required disclosure, recording,
processing, summarizing and reporting as specified in the Securities and
Exchange Commission’s rules and regulations.
Changes
in Internal Controls
There
were no changes in internal controls over financial reporting that occurred
during the period covered by this report that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.
12
PART
II
OTHER
INFORMATION
Item
1. Legal Proceedings.
We are
not a party to any legal proceedings, there are no known judgments against the
Company, nor are there any known actions or suits filed or threatened against us
or our officers and directors, in their capacities as
such. We are not aware of any disputes involving the Company and
the Company has no known claim, actions or inquiries from any federal, state or
other government agency. We are not aware of any claims against
the Company or any reputed claims against it at this time.
Item
1A. Risk Factors.
Any
investment in our securities involves a high degree of risk. There
have been no material changes to the risk factors previously disclosed in our
S-1 and S-1/A filings. However, all risk factors should be considered
and consultation with appropriate legal and financial advisors is
recommended.
When we
become a fully trading company, these additional risk factors should be
considered:
Our
Common Stock Is Subject To Penny Stock Regulation
Our
shares are subject to the provisions of Section 15(g) and Rule 15g-9 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), commonly
referred to as the "penny stock" rule. Section 15(g) sets forth
certain requirements for transactions in penny stocks and Rule 15g-9(d)(1)
incorporates the definition of penny stock as that used in Rule 3a51-1 of the
Exchange Act. The Commission generally defines penny stock to be any
equity security that has a market price less than $5.00 per share, subject to
certain exceptions. Rule 3a51-1 provides that any equity security is
considered to be penny stock unless that security is: registered and traded on a
national securities exchange meeting specified criteria set by the Commission;
authorized for quotation on the NASDAQ Stock Market; issued by a registered
investment company; excluded from the definition on the basis of price (at least
$5.00 per share) or the registrant's net tangible assets; or exempted from the
definition by the Commission. Since our shares are deemed to be
"penny stock", trading in the shares will be subject to additional sales
practice requirements on broker/dealers who sell penny stock to persons other
than established customers and accredited investors.
FINRA Sales Practice
Requirements May Also Limit A Stockholder's Ability To Buy And Sell Our
Stock
In
addition to the “penny stock” rules described above, the Financial Industry
Regulatory Authority (FINRA) has adopted rules that require that in recommending
an investment to a customer, a broker-dealer must have reasonable grounds for
believing that the investment is suitable for that customer. Prior to
recommending speculative low priced securities to their non-institutional
customers, broker-dealers must make reasonable efforts to obtain information
about the customer's financial status, tax status, investment objectives and
other information. Under interpretations of these rules, FINRA
believes that there is a high probability that speculative low priced securities
will not be suitable for at least some customers. FINRA requirements
make it more difficult for broker-dealers to recommend that their customers buy
our common stock, which may limit your ability to buy and sell our stock and
have an adverse effect on the market for our shares.
We
May Not Have Access To Sufficient Capital To Pursue Our Business And Therefore
Would Be Unable To Achieve Our Planned Future Growth
We intend
to pursue a growth strategy that includes development of the Company business
and technology assets. Currently we have limited capital which may be
insufficient to pursue our plans for development and growth. Our
ability to implement our growth plans may depend primarily on our ability to
obtain additional private or public equity or debt financing. We are
currently seeking additional capital. Such financing may not be
available at all, or we may be unable to locate and secure additional capital on
terms and conditions that are acceptable to us. Our failure to obtain
additional capital may have a material adverse effect on our
business.
13
Nevada Law
And Our Articles Of Incorporation Protect Our Directors From Certain Types Of
Lawsuits, Which Could Make It Difficult For Us To Recover Damages From Them In
The Event Of A Lawsuit
Nevada
law provides that our directors will not be liable to our Company or to our
stockholders for monetary damages for all but certain types of conduct as
directors. Our Articles of Incorporation require us to indemnify our
directors and officers against all damages incurred in connection with our
business to the fullest extent provided or allowed by law. The
exculpation provisions may have the effect of preventing stockholders from
recovering damages against our directors caused by any negligence,
poor
judgment
or other circumstances. The indemnification provisions may require
our Company to use our assets to defend our directors and officers against
claims, including claims arising out of their negligence, poor judgment, or
other circumstances.
Because
We Are Quoted On The OTCBB Instead Of An Exchange Or National Quotation System,
Our Investors May Have A Tougher Time Selling Their Stock Or Experience Negative
Volatility On The Market Price Of Our Stock
Our
common stock is traded on the OTCBB. The OTCBB is often highly
illiquid. There is a greater chance of volatility for securities that
trade on the OTCBB as compared to a national exchange or quotation
system. This volatility may be caused by a variety of factors,
including the lack of readily available price quotations, the absence of
consistent administrative supervision of bid and ask quotations, lower trading
volume, and market conditions. Investors in our common stock may
experience high fluctuations in the market price and volume of the trading
market for our securities. These fluctuations, when they occur, have
a negative effect on the market price for our
securities. Accordingly, our stockholders may not be able to realize
a fair price from their shares when they determine to sell them or may have to
hold them for a substantial period of time until the market for our common stock
improves.
Failure
To Achieve And Maintain Effective Internal Controls In Accordance
With Section 404 Of The Sarbanes-Oxley Act Could Have A Material
Adverse Effect On Our Business And Operating Results
It may be
time consuming, difficult and costly for us to develop and implement the
additional internal controls, processes and reporting procedures required by the
Sarbanes-Oxley Act. We may need to hire additional financial
reporting, internal auditing and other finance staff in order to develop and
implement appropriate additional internal controls, processes and reporting
procedures. If we are unable to comply with these requirements of the
Sarbanes-Oxley Act, we may not be able to obtain the independent accountant
certifications that the Sarbanes-Oxley Act requires of publicly traded
companies.
If we
fail to comply in a timely manner with the requirements of Section 404 of
the Sarbanes-Oxley Act regarding internal control over financial reporting or to
remedy any material weaknesses in our internal controls that we may identify,
such failure could result in material misstatements in our financial statements,
cause investors to lose confidence in our reported financial information and
have a negative effect on the trading price of our common stock.
Pursuant
to Section 404 of the Sarbanes-Oxley Act and current SEC regulations, we
will be required to prepare assessments regarding internal controls over
financial reporting and furnish a report by our management on our internal
control over financial reporting. We have begun the process of
documenting and testing our internal control procedures in order to satisfy
these requirements, which is likely to result in increased general and
administrative expenses and may shift management time and attention from
revenue-generating activities to compliance activities. While our
management is expending significant resources in an effort to complete this
important project, there can be no assurance that we will be able to achieve our
objective on a timely basis. There also can be no assurance that our
auditors will be able to issue an unqualified opinion on management’s assessment
of the effectiveness of our internal control over financial
reporting. Failure to achieve and maintain an effective internal
control environment or complete our Section 404 certifications could have a
material adverse effect on our stock price.
In
addition, in connection with our on-going assessment of the effectiveness of our
internal control over financial reporting, we may discover “material weaknesses”
in our internal controls as defined in standards established by the Public
Company Accounting Oversight Board, or the PCAOB. A material weakness
is a significant deficiency, or combination of significant deficiencies, that
results in more than a remote likelihood that a material misstatement of the
annual or interim financial statements will not be prevented or
detected. The PCAOB defines “significant deficiency” as a deficiency
that results in more than a remote likelihood that a misstatement of the
financial statements that is more than inconsequential will not be
prevented or detected.
In the
event that a material weakness is identified, we will employ qualified personnel
and adopt and implement policies and procedures to address any material
weaknesses that we identify. However, the process of designing and
implementing effective internal controls is a continuous effort that requires us
to anticipate and react to changes in our business and the economic and
regulatory environments and to expend significant resources to maintain a system
of internal controls that is adequate to satisfy our reporting obligations as a
public company. We cannot assure you that the measures we will take
will remediate any material weaknesses that we may identify or that we will
implement and maintain adequate controls over our financial process and
reporting in the future.
Any
failure to complete our assessment of our internal control over financial
reporting, to remediate any material weaknesses that we may identify or to
implement new or improved controls, or difficulties encountered in their
implementation, could harm our operating results, cause us to fail to meet our
reporting obligations or result in material misstatements in our financial
statements. Any such failure could also adversely affect the results of the
periodic management evaluations of our internal controls and, in the case of a
failure to remediate any material weaknesses that we may identify, would
adversely affect the annual auditor attestation reports
regarding the effectiveness of our internal control over financial reporting
that are required under Section 404 of the Sarbanes-Oxley
Act. Inadequate internal controls could also cause investors to lose
confidence in our reported financial information, which could have a negative
effect on the trading price of our common stock.
Operating
History and Lack Of Profits Which Could Lead To Wide Fluctuations In Our Share
Price. The Price At Which You Purchase Our Common Shares May Not Be
Indicative Of The Price That Will Prevail In The Trading Market. You
May Be Unable To Sell Your Common Shares At Or Above Your Purchase Price, Which
May Result In Substantial Losses To You. The Market Price For Our
Common Shares May Be Particularly Volatile Given Our Status As A
Relatively
Unknown
Company With A Small And Thinly Traded Public Float
The
market for our common shares is characterized by significant price volatility
when compared to seasoned issuers, and we expect that our share price will
continue to be more volatile than a seasoned issuer for the indefinite
future. The volatility in our share price is attributable to a number
of factors. First, as noted above, our common shares are sporadically
and thinly traded. As a consequence of this lack of liquidity, the
trading of relatively small quantities of shares by our shareholders may
disproportionately influence the price of those shares in either
direction. The price for our shares could, for example, decline
precipitously in the event that a large number of our common shares are sold on
the market without commensurate demand, as compared to a seasoned issuer which
could better absorb those sales without adverse impact on its share
price. Secondly, we are a speculative or “risky” investment due to
our limited operating history and lack of profits to date, and uncertainty of
future market acceptance for our potential products. As a consequence
of this enhanced risk, more risk-adverse investors may, under the fear of losing
all or most of their investment in the event of negative news or lack of
progress, be more inclined to sell their shares on the market more quickly and
at greater discounts than would be the case with the stock of a seasoned
issuer. Many of these factors are beyond our control and may decrease
the market price of our common shares, regardless of our operating
performance. We cannot make any predictions or projections as to what
the prevailing market price for our common shares will be at any time, including
as to whether our common shares will sustain their current market prices, or as
to what effect that the sale of shares or the availability of common shares for
sale at any time will have on the prevailing market price.
Shareholders
should be aware that, according to SEC Release No. 34-29093, the market for
penny stocks has suffered in recent years from patterns of fraud and
abuse. Such patterns include (1) control of the market for the
security by one or a few broker-dealers that are often related to the promoter
or issuer; (2) manipulation of prices through prearranged matching of
purchases and sales and false and misleading press releases; (3) boiler
room practices involving high-pressure sales tactics and unrealistic price
projections by inexperienced sales persons; (4) excessive and undisclosed
bid-ask differential and markups by selling broker-dealers; and (5) the
wholesale dumping of the same securities by promoters and broker-dealers after
prices have been manipulated to a desired level, along with the resulting
inevitable collapse of those prices and with consequent investor
losses. Our management is aware of the abuses that have occurred
historically in the penny stock market. Although we do not expect to
be in a position to dictate the behavior of the market or of broker-dealers who
participate in the market, management will strive within the confines of
practical limitations to prevent the described patterns from being established
with respect to our securities. The occurrence of these patterns or
practices could increase the volatility of our share price.
Volatility
In Our Common Share Price May Subject Us To Securities Litigation, Thereby
Diverting Our Resources That May Have A Material Effect On Our Profitability And
Results Of Operations
As
discussed in the preceding risk factors, the market for our common shares is
characterized by significant price volatility when compared to seasoned issuers,
and we expect that our share price will continue to be more volatile than a
seasoned issuer for the indefinite future. In the past, plaintiffs
have often initiated securities class action litigation against a company
following periods of volatility in the market price of its
securities. We may in the future be the target of similar
litigation. Securities litigation could result in substantial costs
and liabilities and could divert management’s attention and
resources.
14
Item
2. Unregistered Sale of Equity Securities and Use of
Proceeds.
The
Company has not engaged in the sale of any unregistered securities.
Item
3. Defaults Upon Senior Securities.
There
were no defaults upon senior securities of during this reporting period.
Item
4. Submission of Matters to a Vote of Security Holders.
No
matters have been submitted to a vote of the security holders.
Item
5. Other Information.
None
Item
6. Exhibits.
Exhibit No.
|
|
Description
|
23.1
|
Consent
of Arshad M. Farooq, CPA
|
|
31.1
|
|
Certification
of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
Act
|
32.1
|
|
Certification
Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley
Act
|
WPS,
INC.
|
|||
Dated: November
10, 2009
|
By:
|
/s/ Guillermo
Pina
|
|
Guillermo
Pina
|
|||
Chief
Executive Officer, President and Chairman
(Principal
Executive Officer)
(Principal
Financial/Accounting Officer)
|
|||