WINDGEN ENERGY, INC. - Quarter Report: 2010 March (Form 10-Q)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the quarterly period ended March 31, 2010
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TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from __________ to __________
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WINDGEN ENERGY, INC.
(Exact name of registrant as specified in its charter)
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Utah
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87-0397815
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(State or other jurisdiction of
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(IRS Employer Identification No.)
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incorporation or organization)
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14550 N. Frank Lloyd Wright Blvd., Suite 100
Scottsdale, Arizona 85260
(Address of principal executive offices)
(480) 991-9500
(Registrant’s telephone number, including area code)
InMedica Development Corporation
(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 registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o
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 o No þ Not applicable.
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” 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 | Small reporting company þ |
Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes o No þ
As of May 20, 2009, 35,496,160 shares of the issuer’s common stock were outstanding.
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Table of Contents
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Page No.
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| Forward-Looking Statements | 3 | |
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| Signatures |
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WINDGEN ENERGY, INC.
This Quarterly Report on Form 10-Q (“Quarterly Report”) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and should be read in conjunction with the Financial Statements of WindGen Energy, Inc. (the “Company” or “WindGen”). Such statements are not historical facts and reflect our current views regarding matters such as operations and financial performance. In general, forward-looking statements are identified by such words or phrases as “expects,” “anticipates,” “believes,” “could,” “approximates,” “estimates,” “may,” “intends,” “predicts,” “projects,” “plans,” or “will,” or the negative of those words or other terminology. These statements are not guarantees of future performance and involve certain known and unknown inherent risks, uncertainties and other factors that are difficult to predict; our actual results could differ materially from those expressed in these forward-looking statements, including those risks and other factors described elsewhere in this Quarter Report. The cautionary factors, risks and other factors presented should not be construed as exhaustive. Other risks not presently known to us, or that we currently believe are immaterial, could also adversely affect our business, financial condition or results of operations.
Each forward-looking statement should be read in context with, and with an understanding of, the various disclosures concerning our business made elsewhere in this Quarterly Report, as well as other public reports filed by us with the United States Securities and Exchange Commission. Readers should not place undue reliance on any forward-looking statement as a prediction of actual results of developments. Except as required by applicable law or regulation, we undertake no obligation to update or revise any forward-looking statement contained in this Quarterly Report.
| Item 1. |
Financial Statements
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CONSOLIDATED BALANCE SHEETS
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March 31,
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December 31,
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2010
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2009
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ASSETS
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Current Assets
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Cash & Cash Equivalents
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35,949 | 14,323 | ||||||
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Prepaid Expenses & Other
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200 | 200 | ||||||
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Total Current Assets
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36,149 | 14,523 | ||||||
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Fixed Assets
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Equipment & Furniture, at Cost, Less Accumulated
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Depreciation of $255,221 and $255,221,
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respectively
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– | – | ||||||
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TOTAL ASSETS
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36,149 | 14,523 | ||||||
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LIABILITIES & STOCKHOLDER'S EQUITY
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Current Liabilities
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Related Parties Consulting Fees Payable
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90,000 | 60,000 | ||||||
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Accounts Payable
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28,057 | 36,166 | ||||||
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Accrued Interest
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47,765 | 45,112 | ||||||
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Related Party Royalty Payable
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163,333 | 153,333 | ||||||
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Related Party Note Payable
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171,342 | 179,842 | ||||||
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Related Party Payables
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10,000 | 38,445 | ||||||
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Note Payable
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10,860 | 22,799 | ||||||
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Preferred Stock Dividends Payable
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66,200 | 64,309 | ||||||
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Current Portion of Long-Term Debt
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232,633 | 232,633 | ||||||
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TOTAL LIABILITIES
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820,190 | 832,639 | ||||||
(Continued)
The accompanying notes are an integral part of these financial statements.
WINDGEN ENERGY, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Continued)
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March 31,
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December 31
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2010
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2009
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(Unaudited)
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STOCKHOLDERS' EQUITY (DEFICIT)
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Preferred Stock, 10,000,000 shares authorized; Series A Cumulative
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convertible preferred stock, 8% cumulative, $4.50 par value,
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1,000,000 shares designated, 21,016 shares outstanding
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(aggregate liquidation preference of $160,773)
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94,573 | 94,573 | ||||||
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Common Stock, $.001 par value: 100,000,000 shares authorized,
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35,496,160 and 33,629,493 shares outstanding, respectively
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35,496 | 33,629 | ||||||
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Addional Paid-In Capital
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8,806,882 | 8,668,749 | ||||||
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Stock Subscription Receivable
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(17,500 | ) | (17,500 | ) | ||||
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Accumulated Deficit
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(9,432,058 | ) | (9,334,935 | ) | ||||
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TOTAL WINDGEN STOCKHOLDERS' EQUITY (DEFICIT)
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(512,607 | ) | (555,484 | ) | ||||
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Noncontrolling Interest
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(271,434 | ) | (262,632 | ) | ||||
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TOTAL STOCKHOLDERS' EQUITY (DEFICIT)
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(784,041 | ) | (818,116 | ) | ||||
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TOTAL LIABILITIES & EQUITY
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36,149 | 14,523 | ||||||
The accompanying notes are an integral part of these financial statements.
WINDGEN ENERGY, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
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For the Three Months Ended
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March 31,
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2010
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2009
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ROYALTY REVENUES
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$
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–
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$
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–
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OPERATING EXPENSES
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General & Administrative
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40,440
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25,106
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Legal & Professional Fees
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24,409
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4,950
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Related Party Consulting Fees
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33,975
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–
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Total Operating Expenses
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98,824
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30,056
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INCOME (LOSS) FROM OPERATIONS
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(98,824
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)
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(30,056
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)
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OTHER INCOME (EXPENSE)
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Interest Expense
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(5,210
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(3,043
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Total Other Income (Expense), Net
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(5,210
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(3,043
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NET INCOME (LOSS)
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(104,034
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(33,099
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)
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NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTEREST
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8,802
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5,882
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NET INCOME (LOSS) ATTRIBUTABLE TO WINDGEN ENERGY, INC.
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(95,232
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(27,217
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PREFERRED STOCK DIVIDENDS
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(1,891
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)
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(1,891
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)
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NET INCOME (LOSS) APPLICABLE TO COMMON STOCKHOLDERS
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$
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(97,123
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$
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(29,108
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)
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NET INCOME (LOSS) PER COMMON SHARE (BASIC & DILUTED)
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$
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(0.00
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)
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$
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(0.00
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)
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WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
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BASIC
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34,921,344
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18,629,493
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DILUTED
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34,952,868
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38,661,017
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The accompanying notes are an integral part of these financial statements.
CONSOLIDATED STATEMENTS OF CASH FLOWS
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For the Three Months Ended
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March 31,
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2010
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2009
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CASH FLOWS FROM OPERATING ACTIVITIES:
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Net Loss
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$ | (95,232 | ) | $ | (27,217 | ) | ||
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Adjustments to reconcile Net loss
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to net cash used in operating activities:
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Noncontrolling interest in losses
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(8,802 | ) | (5,882 | ) | ||||
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Related party consulting fee payable
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30,000 | – | ||||||
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Prepaid rent
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– | 900 | ||||||
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Accounts payable
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(8,109 | ) | 18,578 | |||||
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Related party payable
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(28,445 | ) | – | |||||
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Accrued interest payable
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4,873 | 3,044 | ||||||
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Royalty payable to related party
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10,000 | 10,000 | ||||||
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Net cash used in operating activities
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(95,715 | ) | (577 | ) | ||||
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CASH FLOWS FROM INVESTING ACTIVITIES:
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Net cash provided by investing activities
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– | – | ||||||
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CASH FLOWS FROM FINANCING ACTIVITIES:
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Proceeds from sale of stock
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140,000 | – | ||||||
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Payments on notes
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(11,939 | ) | – | |||||
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Payments on notes related party loan
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(10,720 | ) | – | |||||
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Net cash provided by financing activities
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117,341 | – | ||||||
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NET INCREASE (DECREASE) IN CASH
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21,626 | (577 | ) | |||||
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CASH AT BEGINNING OF PERIOD
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14,323 | 1,794 | ||||||
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CASH AT END OF PERIOD
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35,949 | 1,217 | ||||||
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SUPPLEMENTAL DISCLOSURE OF CASH FLOW
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Cash paid during the year for interest
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$ | 2,986 | $ | 3,043 | ||||
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Cash paid during the year for income taxes
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$ | – | $ | – | ||||
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SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING &
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FINANCING ACTIVITIES:
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Stock Subscription Receivable for exercise of stock options
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$ | 17,500 | $ | – | ||||
The accompanying notes are an integral part of these financial statements.
(Formerly InMedica Development Corporation)
Notes to Consolidated Financial Statements (Unaudited)
NOTE 1 – BASIS OF PRESENTATION
The accompanying unaudited consolidated financials statements of WindGen Energy, Inc. (formerly InMedica Development Corporation) and its majority owned subsidiary, MicroCor, Inc. (collectively the “Company”) have been prepared on a going concern basis which contemplates the realization of assets and satisfaction of liabilities that might be necessary should the Company be unable to continue as a going concern. The Company generated a net loss of $95,232 and $27,217 for the three month periods ended March 31, 2010 and 2009, respectively, and negative cash flows from operations of $95,715 and $577 for the three month periods ended March 31, 2010 and 2009, respectively. As of March 31, 2010, the Company had an accumulated deficit of $9,432,058. At March 31, 2010, the Company had a stockholders’ deficit of $512,607. These conditions raise substantial doubt as to the Company’s ability to continue as a going concern. The Company’s continued existence is dependent upon its ability to execute its operating plan and to obtain additional debt or equity financing. There can be no assurance that the necessary debt or equity financing will be available, or will be available on terms acceptable to the Company.
The accompanying consolidated financial statements of the Company are unaudited. However, in management’s opinion, all adjustments, consisting only of normal recurring adjustments necessary for fair presentation of results for the interim periods shown, have been made. Results for interim periods are not necessarily indicative of those to be expected for the full year. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes to consolidated financial statements included in the Company’s annual report on Form 10-K for the year ended December 31, 2009.
NOTE 2 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
On April 17, 2009, the Company entered into a license agreement (the “License”) with Wind Sail Receptor, Inc. of Boulder City, Nevada (“WSR”), pursuant to which the Company was granted the exclusive license to sell WSR’s wind sail receptor wind generation systems using blades of 15 feet in length or less in the United States, Canada, the United Kingdom and Ireland, with nonexclusive rights in the rest of the world except Latin America and the Caribbean. Under the License, the Company must acquire 100 blades from WSR during the year after WSR is able to manufacture the receptors. WSR is hopeful of commencing manufacture of the blades in the second half of 2010. The Company will market WSR’s wind receptor blades through its new division called WindGen Energy. The Company is currently negotiating with WSR to add additional exclusive territory to the License and, in addition, amending the License to allow the Company to manufacture and/or assemble the WSR wind generation systems.
On December 4, 2009, the Company changed its name to WindGen Energy, Inc.
On December 4, 2009, the Company increased its authorized capital to 100,000,000 shares of common stock.
(Formerly InMedica Development Corporation)
Notes to Consolidated Financial Statements (Unaudited)
NOTE 2 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)
Principles of Consolidation
The consolidated financial statements include the accounts of WindGen and MicroCor. All material inter-company accounts and transactions have been eliminated.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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.
Patents
The Company has three patents covering various aspects of its hematocrit technology, which expire from 2010 to 2013.
Research and Development
Research and development costs are expensed as incurred.
Net Loss Per Common Share
Basic net loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding during the year. Diluted net loss per common share (“Diluted EPS”) reflects the potential dilution that could occur if stock options or other common stock equivalents were exercised or converted into common stock. At March 31, 2010 and December 31, 2009, respectively, there were 31,524 and 31,524 potentially dilutive common stock equivalents. The computation of Diluted EPS does not assume exercise or conversion of securities that would have an anti-dilutive effect on net loss per common share.
(Formerly InMedica Development Corporation)
Notes to Consolidated Financial Statements (Unaudited)
NOTE 3 – PREFERRED STOCK
The Company is authorized to issue 100,000,000 shares of preferred stock. The Company’s board of directors designated 1,000,000 shares of this preferred stock as Series A Cumulative Convertible Preferred Stock (“Series A Preferred”) with a par value of $4.50 per share. Holders of the Series A Preferred receive annual cumulative dividends of eight percent, payable quarterly, which dividends are required to be fully paid or set aside before any other dividend on any class or series of stock of the Company is paid. As of March 31, 2010, cumulative preferred stock dividends are due and payable in the amount of $66,200. Holders of the Series A Preferred receive no voting rights but do receive a liquidation preference of $4.50 per share, plus accrued and unpaid dividends. Series A Preferred stockholders have the right to convert each share of Series A Preferred to the Company’s common stock at a rate of 1.5 common shares to 1 preferred share.
On January 30, 2009, the Company entered into an agreement with MicroCor, its subsidiary (the “MicroCor Agreement”). The MicroCor Agreement provides for the Company to create a Series B class of preferred stock, without dividend or voting rights (the “Series B Preferred”), which will receive 100% of any future benefit from the sale, spin-off, merger or liquidation of MicroCor or the commercialization of its hematocrit technology. The shares of the Series B Preferred will be distributed as a dividend, subject to compliance with federal and state securities laws and regulations, to the Company’s common stockholders, as of January 30, 2009. The creation of the Series B Preferred will prevent any holder of the Company’s common stock after January 30, 2009 from sharing in any future benefit of or to MicroCor through the expiration date of January 30, 2011.
NOTE 4 - COMMON STOCK TRANSACTIONS
During the first quarter ending March 31, 2010, the Company issued 1,866,667 shares of common stock for cash of $140,000. The stock issuances were the result of a private placement offering commenced January 20, 2010 for a total offering of $300,000. The Private Placement is still being offered until June 30, 2010, at which time the Company may elect to continue the offering for an additional six months.
On December 4, 2009, the Company changed its total authorized common shares from 40,000,000 to 100,000,000 shares.
(Formerly InMedica Development Corporation)
Notes to Consolidated Financial Statements (Unaudited)
NOTE 5 – EARNINGS PER SHARE
The following data show the amounts used in computing earnings per share and the effect on income and the weighted average number of shares of dilutive potential common stock:
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For the Quarters Ended
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March 31,
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2010
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2009
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Net Income (Loss)
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$
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97,123
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$
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29,108
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Less: preferred dividends
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(1,891
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)
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(1,891
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)
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Income (Loss) available to common stockholders used in basic EPS
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$
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95,232
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$
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27,217
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Convertible preferred stock
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1,891
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1,891
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Convertible notes payable
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–
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–
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Income (Loss) available to common stockholders after assumed
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conversion of dilutive securities
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$
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97,123
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$
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29,108
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Weighted average number of common shares used in basic EPS
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34,921,344
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18,629,493
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Effect of dilutive securities:
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Convertible preferred stock
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31,524
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31,524
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Convertible notes payable
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–
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–
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Options
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–
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20,000,000
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Weighted average number of common shares and dilutive potential
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common stock used in diluted EPS
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34,952,868
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38,661,017
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| Item 2. |
Management’s Discussion and Analysis of Financial Condition and Results of Operations.
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Overview
InMedica Development Corporation (“InMedica” or the “Company”) was incorporated as a Utah corporation on June 16, 1983. On December 4, 2009, a majority of the Company’s shareholders executed a consent resolution to amend the Company’s Articles of Incorporation to change the Company’s name to WindGen Energy, Inc. (“WindGen” or the “Company”) and to increase the number of authorized common stock shares from 40,000,000 to 100,000,000. A Certificate of Amendment for such amendments was filed by the Company with the Secretary of State of Utah effective on December 16, 2009. The name change and the new trading symbol, “WGEI,” was approved by FINRA on March 16, 2010.
Since January 30, 2009, the Company’s new management team has been investigating new areas of business and sources of funding for the Company. See “Plan of Operation” below.
Plan of Operation
In January 2008, the Company’s plan of operation was to continue to work cooperatively with MicroCor and Wescor in the development of the Company’s portable hematocrit device. However, in 2008, Wescor advised the Company that its parent corporation was interested in shifting Wescor’s resources previously dedicated to the research and development of the hematocrit technology to other projects. As a result, Wescor ceased all research and development efforts on the hematocrit technology. During 2008, the Company funded administrative operations with the proceeds of minimum royalty payments from MicroCor and from loans from the Company’s officers and Directors. Wescor, in the past, has loaned MicroCor sufficient funds to enable MicroCor to pay one-half of the minimum royalty. These minimum payments to the Company from MicroCor have ceased. Payment of the balance of the minimum royalty from MicroCor was deferred by the Company.
New Company Focus: Wind Energy
With new management, we have refocused the Company on wind energy devices. On April 17, 2009, we entered into a license agreement (the “License”) with Wind Sail Receptor, Inc. of Boulder City, Nevada (“WSR”), pursuant to which we were granted the exclusive license to assemble and market WSR’s wind sail receptor energy generation devices using blades of 15 feet or less in length in the United States, Canada, the United Kingdom and Ireland, with nonexclusive rights in the rest of the world except Latin America and the Caribbean. Under the License, we must acquire 100 blades from WSR during the first year after WSR is able to manufacture the blades. WSR is hopeful of commencing manufacture of our blades in the second half of 2010.
We anticipate our first three wind turbine products to have blade diameters of 3, 6 & 12 feet with towers of up to 100 feet high. We are currently negotiating terms for the formation of the working capital required to bring our first products to market in 2010. The progress of the Company in marketing its new wind energy products is dependent on obtaining additional capital.
Assembly and Marketing
During 2010, we will be developing a well-organized approach to the manufacturing/assembly process to assure high-quality, rapid-development cycles and overall competiveness. All components of our wind turbines are entirely “Made in America.” We are licensed to assemble the wind turbine units, and our first facility will be located in Arizona. WSR will be responsible for the manufacture of the critical blade component at its plant in Boulder City, Nevada. At this time we have located suppliers in the United States for all of the non-blade components for our products.
To launch into the important rural wind turbine market in the western United States (our initial marketing objective), we hope to join forces with some excellent partners and distributorships. We intend to recruit existing wind turbine distributors. In addition, we are currently in contact with various farm equipment dealers who have a well-established rural network of dealers throughout America, all with the ability to provide excellent sales, installation, and maintenance services. We also plan to sell distributorships to other existing service-oriented organizations.
We are currently in the process of finalizing our first two products that should be available during the second half of 2010. Subject to availability of adequate capital, product roll out could follow quickly in the western United States.
Results of Operations
The Company had an accumulated deficit of $9,432,058 as of March 31, 2010. No revenues from operations were received in 2009 and 2008. The Company had a net loss from operations of $98,824 for the quarter ended March 31, 2010, compared to a net loss from operations of $30,056 for the quarter ended March 31, 2009. The increase in net loss from operations resulted primarily from increased Legal and Professional Fees and Related Party Consulting Fees. These types of expenses will continue to increase, subject to funding, as we continue with our business plan.
Liquidity and Capital Resources
During the first quarter of 2010, we sold 1,866,667 shares of restricted common stock for total gross proceeds of $140,000. See “Part II, Item 2, Unregistered Sale of Equity Securities and Use of Proceeds” below.
In 2009, we suffered from a liquidity shortage which negatively impacted our ability to implement our new business plan for entry in the wind energy industry. Such liquidity shortage is continuing in 2010.
Implementation of our new business to assemble and market wind turbines is contingent upon our ability to acquire new capital in 2010. We currently estimate we will need to generate approximately $2,500,000 of new capital during 2010 to fully implement our new business plan. We also estimate $1,500,000 of new capital would permit us to implement enough of our plan to commence minimal marketing of our wind turbine units in the second half of 2010.
We intend to acquire new capital during 2010 through the sale of equity or convertible debt in one or more private placements. Presently, we have no agreement or understanding with any underwriter, investment banker or investor for any financing. There is no assurance we will be able to complete any substantial financing in the future.
| Item 3. |
Quantitative and Qualitative Disclosures About Market Risk.
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Not applicable.
| Item 4T. |
Controls and Procedures.
|
Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures
Under the supervision and with the participation of our principal executive officer and principal financial officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the Exchange Act). Accordingly, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures as defined in Rule 13a-15(e) under the Exchange Act were effective as of March 31, 2010 to ensure that information required to be disclosed in reports we file or submit under the Exchange Act is recorded, processed, and summarized and reported within the time periods specified in SEC rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions as appropriate to allow timely decisions regarding required disclosure.
Management’s Annual Report on Internal Control Over Financial Reporting.
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) and 15d-(f) under the Exchange Act. Our internal control over financial reporting are designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with U. S. generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that:
WINDGEN ENERGY, INC.
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i.
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pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;
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ii.
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provide reasonable assurance that transactions are recorded as necessary to permit the preparation of our consolidated financial statements in accordance with U. S. generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and Directors; and
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iii.
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provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the consolidated financial statements.
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Management assessed the effectiveness of the Company’s internal control over financial reporting as of March 31, 2010. Management has concluded that our internal control over financial reporting was effective as of March 31, 2010.
Inherent Limitations Over Internal Controls
Internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations, including the possibility of human error and circumvention by collusion or overriding of controls. Accordingly, even an effective internal control system may not prevent or detect material misstatements on a timely basis. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.
Changes in Internal Control Over Financial Reporting.
We have made no change in our internal control over financial reporting during the last fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Attestation Report of the Registered Public Accounting Firm.
This quarterly report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our independent registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only management’s report in this quarterly report on Form 10-Q affected, or is reasonably likely to materially affect, our internal control over financial reporting.
| PART II. |
OTHER INFORMATION
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| Item 1. |
Legal Proceedings. None.
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| Item 1A. |
Risk Factors. Not applicable.
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| Item 2. |
Unregistered Sales of Equity Securities and Use of Proceeds.
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During the first quarter of 2010, we sold 1,866,667 shares of restricted common stock for $140,000 to five non-affiliated accredited investors, as that term is defined by SEC Rule 501, pursuant to a Rule 506 private placement we are currently conducting. These sales to accredited investors were made without public solicitation. There were no underwriting discounts or commissions paid on these sales of securities. The proceeds of this offering will be used by the Company for general corporate purposes.
| Item 3. |
Defaults Upon Senior Securities. None.
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| Item 4. |
(Removed and Reserved)
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| Item 5. |
Other Information.
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Change in Directors and Officers
On March 18, 2010, our Board of Directors accepted the resignation of Christopher R. Miller from the positions of Director, Secretary/Treasurer and Chief Financial Officer. There were no disagreements between Mr. Miller and the Company. On March 18, 2010, Ronald Conquest, our Chairman, was appointed as Secretary/Treasurer and Chief Financial Officer.
On April 21, 2010, Ronald Conquest resigned as Secretary, Treasurer and Chief Financial Officer of the Registrant, and Wendy Carriere was appointed to the positions of Director, Secretary, Treasurer and Chief Financial Officer. The business experience of Ms. Carriere is set forth below.
Wendy Carriere, age 40, earned a Bachelors of Science Business Administration from the University of Nevada-Las Vegas in 1993. From January 2010 to present, Ms. Carriere was the owner and Chief Executive Officer of Fair Debt Servicing located Southern California, specializing in servicing loans for large institutional investors. From June 2007 to December 2009, Ms. Carriere was President of Nationwide Auction Finance in Southern California, a subsidiary company of publicly traded Entrade. Nationwide originated loans to individuals and provided loan servicing and collections to its own portfolio. From November 2005 to present, she has served as Chief Financial Officer and Controller of Data Control Corporation in Sacremento, a parent company with subsidiaries specializing in web-based data warehousing, print media publishing and large scale software development. From March 2004 to May 2005, Ms. Carriere was Chief Financial Officer for Newgen Results Corp., a wholly-owned subsidiary of TeleTech located in San Diego with annual revenues of $100M, providing auto dealerships with a complete suite of customer relationship management solutions.
Ms. Carriere is not receiving any compensation for her services at this time, but the Board of Directors may approve compensation for her in the future.
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Exhibits
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Exhibit No.
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Description
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| 10.1a | Option to Purchase Common Stock between Synergistic Equities Ltd. and Chi Lin Technologies Co., Ltd., dated January 28, 2010 (1) | |
| 10.1b | Proxy dated January 28, 2010 between Chi Lin Technology Co., Ltd., Larry Clark and Richard Bruggeman (2) |
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31.1
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Certification by Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act *
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31.2
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Certification by Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act *
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32.1
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Certification by Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act *
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32.2
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Certification by Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act *
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__________________
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*
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Filed herewith.
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(1)
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Incorporated by reference to Exhibit 10.1(e) of the Annual Report on Form 10-K filed on April 15, 2010.
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(2)
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Incorporated by reference to Exhibit 10.1(f) of the Annual Report on Form 10-K filed on April 15, 2010.
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Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| WINDGEN ENERGY, INC. | |||
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Dated: May 24, 2010
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By:
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/s/ Ronald Conquest | |
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Ronald Conquest
Chairman of the Board
and Chief Executive Officer
(Principal Executive Officer)
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|||
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Dated: May 24, 2010
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By:
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/s/ Wendy Carriere | |
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Wendy Carriere
Secretary/Treasurer,
Chief Financial Officer and Director
(Principal Accounting Officer)
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