UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q


þ	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarter ended ~~August 31, 2019~~February 29, 2020

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from ~~__________ to~~__________to __________

Commission file number:000-55957

WEWARDS, INC.

(Exact name of registrant as specified in its Charter)


Nevada	33-1230099
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

2960 West Sahara Avenue

Las Vegas, NV

89102

(Address of principal executive offices)

(Zip Code)

Registrant's telephone number, including area code: 702-944-5599

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
None	None	None

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 filings requirements for the past 90 days. Yes þ No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer¨

Non-accelerated filerþ

Emerging growth company¨

Accelerated filer¨

Smaller reporting companyþ

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

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

As of ~~October 4, 2019,~~April 7, 2020, the registrant had107,483,450 shares of common stock issued and outstanding. ~~No active trading has been established as of October 4, 2019.~~

TABLE OF CONTENTS


			Page
			No.
PART I.I - FINANCIAL INFORMATION
ITEM 1.
~~ITEM 1.~~ FINANCIAL STATEMENTS (Unaudited)	1
		Condensed Balance Sheets as of February 29, 2020 (Unaudited) and May 31, 2019	1
		Condensed Statements of Operations for the Three and Nine Months Ended February 29, 2020 and February 28, 2019 (Unaudited)	2
		Condensed Statement of Changes in Stockholders’ Equity for the Three and Nine Months Ended February 29, 2020 and February 28, 2019 (Unaudited)	3
		Condensed Statements of Cash Flows for the Nine Months Ended February 29, 2020 and February 28, 2019 (Unaudited)	4
		Notes to the Condensed Financial Statements (Unaudited)	5
ITEM 2.	~~MANAGEMENT'S~~	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	1013
ITEM 3.
~~ITEM 3.~~ QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	1118
ITEM 4.
~~ITEM 4.~~ CONTROLS AND PROCEDURES	13
	18
PART ~~II.~~II - OTHER INFORMATION
ITEM 1.
~~ITEM 1.~~ LEGAL PROCEEDINGS	1319
ITEM 1A.
~~ITEM 1A.~~ RISK FACTORS	1319
ITEM 2.
~~ITEM 2.~~ UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	1319
ITEM 3.		DEFAULTS UPON SENIOR SECURITIES	19
ITEM 4.		MINE SAFETY DISCLOSURES	19
ITEM 5.		OTHER INFORMATION	19
ITEM 6.		EXHIBITS	20

~~ITEM 3.~~ ~~DEFAULTS UPON SENIOR SECURITIES~~SIGNATURES	13

~~ITEM 4.~~ ~~MINE SAFETY DISCLOSURES~~	13

~~ITEM 5.~~ ~~OTHER INFORMATION~~	13

~~ITEM 6.~~ ~~EXHIBITS~~	13

~~SIGNATURES~~	1421

~~FORWARD-LOOKING STATEMENTS~~

This quarterly report contains forward-looking statements. These statements relate to future events or our future financial performance. These statements often can be identified by the use of terms such as "may," "will," "expect," "believe," "anticipate," "estimate," "approximate" or "continue," or the negative thereof. We intend that such forward-looking statements be subject to the safe harbors for such statements. We wish to caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made. Any forward-looking statements represent management's best judgment as to what may occur in the future. However, forward-looking statements are subject to risks, uncertainties and important factors beyond our control that could cause actual results and events to differ materially from historical results of operations and events and those presently anticipated or projected. We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of such statement or to reflect the occurrence of anticipated or unanticipated events.

~~GENERAL~~

Throughout this Form 10-Q Quarterly Report, the terms “We,” “Registrant,” “Wewards, Inc.,” “WEWARDS” and “Company” all refer to Wewards, Inc., the corporate name of which was Global Entertainment Clubs, Inc. until January 8, 2018.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

WEWARDS, INC.

CONDENSED BALANCE SHEETS

(Unaudited)


	February 29,			May 31,
	2020			2019
ASSETS

Current assets:
Cash	$	4,249,099		$	4,508,397
Prepaid expenses		—			25,000
Total current assets		4,249,099			4,533,397

Right of use asset		478,677			540,433

Total assets	$	4,727,776		$	5,073,830


LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)

Current liabilities:
Accounts payable	$	200		$	329
Accounts payable, related party		30,012			—
Accrued interest, related parties		1,313,837			912,123
Current maturities of operating lease obligation		147,019			128,705
Due to related parties		225,272			225,272
Current maturities of convertible notes payable, related party		10,500,000			—
Total current liabilities		12,216,340			1,266,429

Long term liabilities:
Operating lease obligation		331,658			411,729
Convertible notes payable, related party		—			10,500,000

Total liabilities		12,547,998			12,178,158

Commitments and contingencies		—			—

Stockholders' equity (deficit):
Preferred stock, $0.001 par value, 50,000,000 shares authorized, no shares issued and outstanding		—			—
Common stock, $0.001 par value, 500,000,000 shares authorized, 107,483,450 issued and outstanding		107,483			107,483
Additional paid in capital		5,083,348			5,083,348
Accumulated deficit		(13,011,053	)		(12,295,159	)
Total stockholders' equity (deficit)		(7,820,222	)		(7,104,328	)

Total liabilities and stockholders' equity (deficit)	$	4,727,776		$	5,073,830

~~INDEX TO FINANCIAL STATEMENTS~~


~~Condensed Balance Sheets as of August 31, 2019 and May 31, 2019 (Unaudited)~~	2
~~Condensed Statements of Operations for the three months ended August 31, 2019 and 2018 (Unaudited)~~	3
~~Condensed Statement of Stockholders’ Deficit for the three months ended August 31, 2019 and 2018 (Unaudited)~~	4
~~Condensed Statements of Cash Flows for the three months ended August 31, 2019 and 2018 (Unaudited)~~	5
~~Notes to the Condensed Financial Statements (Unaudited)~~	6

See accompanying notes to financial statements.

WEWARDS, INC.

CONDENSED ~~BALANCE SHEETS~~STATEMENTS OF OPERATIONS

(Unaudited)

August 31, 2019

May 31, 2019

ASSETS

Current Assets:

Cash

$
4,318,218

$
4,508,397

Prepaid expenses

—

25,000

Total current assets

4,318,218

4,533,397

Right of use asset

509,212

540,433

Total Assets

$
4,827,430

$
5,073,830

LIABILITIES AND STOCKHOLDERS’ DEFICIT

Current Liabilities:

Accounts payable

$
100

$
329

Accrued interest - related party

1,046,850

912,123

Due to related parties

225,272

225,272

Operating lease obligation

131,296

128,705

Total Current Liabilities

1,403,518

1,266,429

Long Term Liabilities:

Convertible Notes Payable - related party

10,500,000

10,500,000

Operating lease obligation – noncurrent portion

377,916

411,729

Total Liabilities

12,281,434

12,178,158

Stockholders’ Deficit:

Preferred stock, par value $0.001; 50,000,000 shares authorized, no shares issued

—

—

Common stock, par value $0.001; 500,000,000 shares authorized, 107,483,450 and 107,483,450 shares issued and outstanding; respectively

107,483

107,483

Additional paid in capital

5,083,348

5,083,348

Accumulated deficit

(12,644,835
)

(12,295,159
)
Total Stockholders’ Deficit

(7,454,004
)

(7,104,328
)
Total Liabilities and Stockholders’ Deficit

$
4,827,430

$
5,073,830


	For the Three			For the Three			For the Nine			For the Nine
	Months Ended			Months Ended			Months Ended			Months Ended
	February 29,			February 28,			February 29,			February 28,
	2020			2019			2020			2019

Revenue	$	—		$	—		$	—		$	—

Operating expenses:
General and administrative		3,142			88,448			6,088			485,671
Rent expense, related party		45,000			48,479			135,000			138,479
Professional fees		15,250			101,100			232,325			306,497
Total operating expenses		63,392			238,027			373,413			930,647

Operating loss		(63,392	)		(238,027	)		(373,413	)		(930,647	)

Other income (expense):
Interest expense, related party		(133,699	)		(131,850	)		(401,714	)		(423,015	)
Interest income		17,388			22,846			59,233			53,996
Total other income (expense)		(116,311	)		(109,004	)		(342,481	)		(369,019	)

Net loss	$	(179,703	)	$	(347,031	)	$	(715,894	)	$	(1,299,666	)

Weighted average number of common shares outstanding - basic and fully diluted		107,483,450			107,483,450			107,483,450			105,635,822

Net loss per share - basic and fully diluted	$	(0.00	)	$	(0.00	)	$	(0.01	)	$	(0.01	)

~~The~~See accompanying notes ~~are an integral part of thesecondensed unaudited~~to financial statements.

WEWARDS, INC.

CONDENSED STATEMENTS OF ~~OPERATIONS~~CHANGES IN STOCKHOLDERS' EQUITY

(Unaudited)

For the Three Months Ended
August 31,

2019

2018

Revenue

$
—

$
—

Operating Expenses:

General and administrative

191,703

223,458

General and administrative – related party

—

87,500

Rent expense – related party

45,000

45,000

Total expenses

236,703

355,958

Other income (expense):

Interest expense– related party

(134,727
)

(157,877
)
Interest income

21,754

13,119

Total other expense

(112,973
)

(144,758
)

Loss before provision for income taxes

(349,676
)

(500,716
)

Provision for Income Taxes

—

—

Net Loss

$
(349,676
)

(500,716
)

Net loss per share, basic and diluted

$
(0.00
)

$
(0.00
)
Weighted average shares outstanding, basic and diluted

107,483,450

102,184,537


	For the Three Months Ended February 28, 2019
									Additional					Total
	Preferred Stock				Common Stock				Paid-in		Accumulated			Stockholders'
	Shares		Amount		Shares		Amount		Capital		Deficit			Equity

Balance, November 30, 2018		—	$	—		107,483,450	$	107,483	$	5,083,349		(10,863,577	)	$	(5,672,745	)
Net loss for the three months ended February 28, 2019		—		—		—		—		—		(347,031	)		(347,031	)
Balance, February 28, 2019		—	$	—		107,483,450	$	107,483	$	5,083,349	$	(11,210,608	)	$	(6,019,776	)


	For the Three Months Ended February 29, 2020
									Additional					Total
	Preferred Stock				Common Stock				Paid-in		Accumulated			Stockholders'
	Shares		Amount		Shares		Amount		Capital		Deficit			Equity

Balance, November 30, 2019		—	$	—		107,483,450	$	107,483	$	5,083,348	$	(12,831,350	)	$	(7,640,519	)
Net loss for the three months ended February 29, 2020		—		—		—		—		—		(179,703	)		(179,703	)
Balance, February 29, 2020		—	$	—		107,483,450	$	107,483	$	5,083,348	$	(13,011,053	)	$	(7,820,222	)


	For the Nine Months Ended February 28, 2019
									Additional					Total
	Preferred Stock				Common Stock				Paid-in		Accumulated			Stockholders'
	Shares		Amount		Shares		Amount		Capital		Deficit			Equity

Balance, May 31, 2018		—	$	—		88,733,450	$	88,733	$	3,171,197	$	(9,910,942	)	$	(6,651,012	)
Common stock issued for conversion of debt		—		—		18,750,000		18,750		1,481,250		—			1,500,000
Forgiveness of accrued interest, related party		—		—		—		—		430,902		—			430,902
Net loss for the nine months ended February 28, 2019		—		—		—		—		—		(1,299,666	)		(1,299,666	)
Balance, February 28, 2019		—	$	—		107,483,450	$	107,483	$	5,083,349	$	(11,210,608	)	$	(6,019,776	)


	For the Nine Months Ended February 29, 2020
									Additional					Total
	Preferred Stock				Common Stock				Paid-in		Accumulated			Stockholders'
	Shares		Amount		Shares		Amount		Capital		Deficit			Equity

Balance, May 31, 2019		—	$	—		107,483,450	$	107,483	$	5,083,348	$	(12,295,159	)	$	(7,104,328	)
Net loss for the nine months ended February 29, 2020		—		—		—		—		—		(715,894	)		(715,894	)
Balance, February 29, 2020		—	$	—		107,483,450	$	107,483	$	5,083,348	$	(13,011,053	)	$	(7,820,222	)

~~The~~See accompanying notes ~~are an integral part of thesecondensed unaudited~~to financial statements.

WEWARDS, INC.

~~STATEMENT~~CONDENSED STATEMENTS OF ~~STOCKHOLDERS’ DEFICIT~~CASH FLOWS

(Unaudited)

Preferred Stock

Common Stock

Additional
Paid in

Accumulated

Shares

Amount

Shares

Amount

Capital

Deficit

Total

Balance at May 31, 2018

—

—

88,733,450

88,733

3,171,197

(9,910,942
)

(6,651,012
)

Stock issued for conversion of debt – related party

—

—

18,750,000

18,750

1,481,250

—

1,500,000

Forgiveness of accrued interest – related party

—

—

—

—

430,902

—

430,902

Net loss

—

—

—

—

—

(500,716
)

(500,716
)

Balance at August 31, 2018

—

$
—

107,483,450

$
107,483

$
5,083,349

$
(10,411,658
)

$
(5,220,826
)

Preferred Stock

Common Stock

Additional
Paid in

Accumulated

Shares

Amount

Shares

Amount

Capital

Deficit

Total

Balance at May 31, 2019

—

—

107,483,450

$
107,483

$
5,083,348

$
(12,295,159
)

$
(7,104,328
)

Net loss

—

—

—

—

—

(349,676
)

(349,676
)

Balance at August 31, 2019

—

$
—

107,483,450

$
107,483

$
5,083,348

$
(12,644,835
)

$
(7,454,004
)


	For the Nine			For the Nine
	Months Ended			Months Ended
	February 29,			February 28,
	2020			2019
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(715,894	)	$	(1,299,666	)
Adjustments to reconcile net loss to net cash used in operating activities:
Decrease (increase) in assets:
Prepaid expenses		25,000			262,260
Increase (decrease) in liabilities:
Accounts payable		(130	)		423,005
Accounts payable, related party		30,012			—
Accrued interest, related party		401,714			(148,058	)
Net cash used in operating activities		(259,298	)		(762,459	)

CASH FLOWS FROM INVESTING ACTIVITIES
Intangible assets		—			(432,200	)
Net cash used in investing activities		—			(432,200	)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds received from a related party		—			35,000
Repayment of related party loans		—			(5,000,000	)
Net cash used in financing activities		—			(4,965,000	)

NET CHANGE IN CASH		(259,298	)		(6,159,659	)
CASH AT BEGINNING OF PERIOD		4,508,397			10,794,298

CASH AT END OF PERIOD	$	4,249,099		$	4,634,639

SUPPLEMENTAL INFORMATION:
Interest paid	$	—		$	—
Income taxes paid	$	—		$	—

NON-CASH INVESTING AND FINANCING ACTIVITIES:
Related party debt converted to common stock	$	—		$	1,500,000
Forgiveness of accrued interest, related party contributed to capital	$	—		$	430,902

~~The~~

See accompanying notes ~~are an integral part of thesecondensed unaudited~~to financial statements.

WEWARDS, INC.

~~STATEMENTS OF CASH FLOWS~~

~~(Unaudited)~~

For the Three Months Ended
August 31,

2019

2018

Cash flows from operating activities:





Net loss

$
(349,676
)

$
(500,716
)
Adjustments to reconcile net loss to net cash used in operating activities:

Changes in assets and liabilities:

Prepaid expenses

25,000

87,510

Accounts payable

(229
)

(114,895
)
Accrued interest – related party

134,726

157,868

Cash flows used in operating activities

(190,179
)

(370,233
)

Cash flows from investing activities:

Capitalized software development costs

—

(432,200
)
Cash flows used in investing activities

—

(432,200
)

Cash flows from financing activities:

Proceeds from a related party

—

35,000

Repayment of related party notes

—

(5,000,000
)
Cash flows used in financing activities

—

(4,965,000
)

Net decrease in cash

(190,179
)

(5,767,433
)
Cash, beginning of period

4,508,397

10,794,298

Cash, end of period

$
4,318,218

$
5,026,865

Supplemental cash flow information:

Interest paid

$
—

$
—

Income taxes paid

$
—

$
—

Supplemental disclosure of non-cash activity:

Related party debt converted to common stock

$
—

$
1,500,000

Forgiveness of accrued interest, related party, classified to additional paid in capital

$
—

$
430,902

~~The accompanying notes are an integral part of thesecondensed unauditedfinancial statements.~~

~~WEWARDS, INC.~~

NOTES TO THE FINANCIAL STATEMENTS

~~August 31, 2019~~February 29, 2020

(Unaudited)

NOTE 1 – ORGANIZATION, BASIS OF PRESENTATION AND ~~NATURE OF BUSINESS~~SIGNIFICANT ACCOUNTING POLICIES

Organization

Wewards, Inc. ~~(formerly Global Entertainment Clubs, Inc.)~~ (“Wewards”, or “the Company”) was incorporated in the state of Nevada on September 10, 2013 as Betafox Corp., with the initial intent to manufacture and sell color candles. On April 26, 2015, Giorgos Kallides (the “Seller”), entered into an ~~Agreement for the Purchase of Common Stock (the “Stock Purchase Agreement”)~~agreement with Future Continental Limited (“Purchaser”), pursuant to which, on May 11, 2015, the Seller ~~agreed to sell~~sold to Purchaser six million (6,000,000) shares of common stock of the Company (the “Shares”) owned by the Seller, constituting approximately 73.8% of the Company’s 8,130,000 issued and outstanding common shares at such time, for $340,000. ~~The sale was consummated on May 11, 2015. As a result~~In October 2015, the Purchaser sold the 6,000,000 Shares to Mr. Lei Pei, an affiliate of the ~~transfer~~Purchaser, in consideration of Mr. Pei’s agreement to serve as our director and CEO.On January 8, 2018, by consent of Lei Pei as the ~~shares, there was a change of control of~~Company’s principal shareholder, the ~~Company.~~Company changed its name to Wewards, Inc. The Company’s corporate office is located in Las Vegas, Nevada.

~~January 8, 2018,~~The Company has developed and is the owner of a web-based platform accessible by ~~consent of Lei Pei, the principal shareholder, the Company changed its corporate name in Nevada to Wewards, Inc. The Company’s trading symbol is now WEWA.~~

~~On August 6, 2016 the Company signed Statements of Work (“SOWs”~~mobile apps (the “Platform”) ~~with Intellectsoft LLC, an unaffiliated company, to perform services for the development and administration of websites to support a mobile app which~~that will enable consumers to purchase goods from merchants and earn rebates payable in the form of ~~Bitcoin, and merchants will be able to sell their goods directly to the users, using this platform.~~

~~The SOWs provide that after this mobile app has been developed, Intellectsoft LLC will then proceed to phase 2, which is intended to be the development of this app for white-label operators.~~

As of May 31, 2019, The Merchant Platform (the “Platform”) has been developed by the Company, which is the owner of the Platform. Development of the Platform began in 2016, and has now been completed, subject to further improvements; however, no license agreement has yet been signed by the Company, and no revenues have been generated.

Bitcoin.The Platform provides an innovative Bitcoin rewards ecosystem. It ~~transforms the~~is designed to transform traditional ~~concept~~concepts of ~~ecommerce, or~~ commerce ~~in general,~~ into ~~a concept of~~ a cooperative society where both merchants and consumers are collaborating, ~~and~~utilizing Bitcoin ~~will serve as the~~to reward ~~system, to acknowledge the value created by the consumers for their contribution.~~consumers. The ecosystem provides consumers with rewards each time they complete a challenge defined by a merchant. This is intended to make the ecommerce process beneficial to ~~everyone,~~all market participants, and to help distribute commercial wealth among and between the merchants and consumers.

~~NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES~~ The Company intends to generate revenue by licensing “white-label” versions of the Platform to third parties. However, to date, no such license agreement has been entered into, and the Company has not generated any revenues.

Basis of ~~presentation~~Presentation

The ~~accompanying~~ unaudited condensed financial statements of the Company and the accompanying notes included in this Quarterly Report on Form 10-Q are unaudited. In the opinion of management, all adjustments necessary for a fair presentation of the Condensed Financial Statements have been included. Such adjustments are of a normal, recurring nature. The Condensed Financial Statements, and the accompanying notes, are prepared in accordance with accounting principles generally accepted in the United States of America ~~for interim financial statements~~(“GAAP”) and ~~with the instructions to Form 10-Q and Article 8 of Regulation S-X of the United States Securities and Exchange Commission (“SEC”). Accordingly, they~~ do not contain ~~all~~certain information and footnotes required by accounting principles generally accepted in the United States of America for annual financial statements. In the opinion of the Company’s management, the accompanying unaudited financial statements contain all the adjustments necessary (consisting only of normal recurring accruals) to present the financial position of the Company as of August 31, 2019 and the results of operations and cash flows for the periods presented. The results of operations for the periods presented are not necessarily indicative of the operating results for the full fiscal year or any future period. These unaudited financial statements should be read in conjunction with the financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended May 31, ~~2019 filed~~2019. The interim Condensed Financial Statements should be read in conjunction with that Annual Report on Form 10-K. Results for the ~~SEC.~~interim periods presented are not necessarily indicative of the results that might be expected for the entire fiscal year.

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 the financial statements and the reported amount of revenues and expenses during the reporting period. Actual results could differ from those estimates.

~~WEWARDS, INC.~~

~~NOTES TO THE FINANCIAL STATEMENTS~~

~~August 31, 2019~~

~~(Unaudited)~~

Concentrations of Credit Risk

~~We maintain~~The Company maintains our cash in bank deposit accounts, the balances of which at times may exceed federally insured limits. ~~We continually monitor our banking relationships~~Accounts are guaranteed by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 under current regulations. The Company had approximately $3,999,199 and ~~consequently have~~$4,258,497 in excess of FDIC insured limits at February 29, 2020 and May 31, 2019, respectively. The Company has not experienced any losses in ~~our~~such accounts. ~~We believe we are not exposed to any significant credit risk on cash.~~

Reclassifications

~~Certain reclassifications have been made to~~In the current period, the Company separately classified professional fees from general and administrative expenses in the Condensed Statement of Operations. For comparative purposes, amounts in the prior period ~~financial information~~have been reclassified to conform to the ~~presentation used~~current period presentation. These reclassifications had no effect on previously reported results of operations.

Fair Value of Financial Instruments

Under FASB ASC 820-10-05, the Financial Accounting Standards Board establishes a framework for measuring fair value in generally accepted accounting principles and expands disclosures about fair value measurements. This Statement reaffirms that fair value is the relevant measurement attribute. The adoption of this standard did not have a material effect on the Company’s financial statements ~~for~~as reflected herein. The carrying amounts of cash, accounts payable and accrued expenses reported on the ~~three months ended August 31, 2019.~~balance sheets are estimated by management to approximate fair value primarily due to the short-term nature of the instruments. The Company had no items that required fair value measurement on a recurring basis.

WEWARDS, INC.

NOTES TO THE FINANCIAL STATEMENTS

February 29, 2020

(Unaudited)

Software ~~development costs~~Development Costs

The Company expenses software development costs, including costs to develop software products or the software component of products to be sold, leased, or marketed to external users, before technological feasibility is reached. Technological feasibility is typically reached shortly before the release of such products. Software development costs also include costs to develop software to be used solely to meet internal needs and cloud-based applications used to deliver our services. The Company capitalizes development costs related to these software applications once the preliminary project stage is complete and it is probable that the project will be completed, and the software will be used to perform the function intended. Capitalization ends, and amortization begins when the product is available for general release to customers.

Impairment of Intangible Assets

The Company reviews intangible assets for impairment when events or changes in circumstances indicate the carrying amount may not be recoverable. The Company measures recoverability of these assets by comparing the carrying amounts to the future undiscounted cash flows that the assets or the asset group are expected to generate. If the carrying value of the assets are not recoverable, the impairment recognized is measured as the amount by which the carrying value of the asset exceeds its fair value.

Stock-Based Compensation

The Company accounts for equity instruments issued to employees in accordance with the provisions of ASC 718 Stock Compensation (ASC 718) and Equity-Based Payments to Non-employees pursuant to ASC 505-50 (ASC 505-50). All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable. The measurement date of the fair value of the equity instrument issued is the earlier of the date on which the counterparty's performance is complete or the date at which a commitment for performance by the counterparty to earn the equity instruments is reached because of sufficiently large disincentives for nonperformance.

Basic and Diluted Loss Per Share

Basic earnings per share (“EPS”) are computed by dividing net income (the numerator) by the weighted average number of common shares outstanding for the period (the denominator). Diluted EPS is computed by dividing net income by the weighted average number of common shares and potential common shares outstanding (if dilutive) during each period. Potential common shares include stock options, warrants and restricted stock. The number of potential common shares outstanding relating to stock options, warrants and restricted stock is computed using the treasury stock method. For the periods presented, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share.

Income Taxes

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided for significant deferred tax assets when it is more likely than not, that such asset will not be recovered through future operations.

Uncertain Tax Positions

In accordance with ASC 740, “Income Taxes” (“ASC 740”), the Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be capable of withstanding examination by the taxing authorities based on the technical merits of the position. These standards prescribe a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. These standards also provide guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition.

Various taxing authorities may periodically audit the Company’s income tax returns. These audits include questions regarding the Company’s tax filing positions, including the timing and amount of deductions and the allocation of income to various tax jurisdictions. In evaluating the exposures connected with various tax filing positions, including state and local taxes, the Company records allowances for probable exposures. A number of years may elapse before a particular matter, for which an allowance has been established, is audited and fully resolved. The Company has not yet undergone an examination by any taxing authorities.

The assessment of the Company’s tax position relies on the judgment of management to estimate the exposures associated with the Company’s various filing positions.

WEWARDS, INC.

NOTES TO THE FINANCIAL STATEMENTS

February 29, 2020

(Unaudited)

Recently Adopted Accounting Standards

In February 2016, the FASB issued ASU 2016-02,Leases (Topic 842). ASU 2016-02 requires lessees to recognize assets and liabilities for most leases. ASU 2016-02 is effective for public entity financial statements for annual periods beginning after December 15, 2018, and interim periods within those annual periods. Early adoption is permitted, including adoption in an interim period. ASU 2016-02 was further clarified and amended within ASU 2018-01, ASU 2018-10, ASU 2018-11 and ASU 2018-20 which included provisions that would provide us with the option to adopt the provisions of the new guidance using a modified retrospective transition approach, without adjusting the comparative periods presented. We adopted the new standard on May 31, 2019 and used the effective date as our date of initial application under the modified retrospective approach. We elected the short-term lease recognition exemption for all of our leases that qualify. This means, for those leases we will not recognize right-of-use (RoU) assets or lease liabilities. The ~~Company has reviewed~~implementation of this new standard did not have a material impact on our financial statements, other ~~recently issued~~than the presentation of a right of use asset and an operating lease obligation liability on the balance sheet in an equal amount.

No other new accounting pronouncements, ~~and plans to adopt those that~~issued or effective during the period ended February 29, 2020, have had or are ~~applicable to it. The Company does not expect the adoption of any other pronouncements~~expected to have ana significant impact on ~~its results of operations or~~the Company’s financial ~~position.~~ statements.

NOTE 32 – GOING CONCERN

The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Although the Company currently has ~~$4,318,218~~$4,249,099 of cash as of ~~August 31, 2019,~~February 29, 2020, it also has total liabilities of ~~$12,281,434 and~~$12,547,998, has not ~~completed its efforts to establish a stabilized source of revenues sufficient to cover its operating costs over an extended period of time. The Company has had no~~generated any revenues since inception, and has an accumulated deficit of ~~$12,644,835.~~$13,011,053. These conditions, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that ~~may result from~~might be necessary if the ~~outcome of these uncertainties.~~Company is unable to continue as a going concern.

Management anticipates that the Company will be dependent, for the near future, on additional investment capital to fund operating expenses until its ~~planned~~ operations begin to generate revenue.

NOTE 3 – RELATED PARTIES

Accounts Payable, Related Party

The Company isowed United Power, Inc.(“United Power”)$30,012 for unpaid rent and utilities as of February 29, 2020. As disclosed in Note 7, below, the ~~process of signing their first customers and is expecting to recognize its first revenue by the end~~Company subleases office space from United Power, an affiliate of the ~~second quarter.~~Company by reason of common ownership with Lei Pei, the Company’s sole officer and director and majority shareholder, at a base monthly rent of $15,000. The building is owned by Future Property Limited (“Future”), another affiliate of the Company due to common ownership.

NOTE 4 – ~~RELATED PARTY LOANS~~

As of August 31, 2019 and May 31, 2019, the Company owed EDG Development, a company owned by Mr. Pei, $70,740 and $70,740, respectively. All funds expended to date have been used for professional fees, and for other general operating purposes. The loans are unsecured, non-interest bearing and due on demand.FAIR VALUE OF FINANCIAL INSTRUMENTS

AsUnder FASB ASC 820-10-5, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The standard outlines a valuation framework and creates a fair value hierarchy in order to increase the consistency and comparability of ~~August 31, 2019~~fair value measurements and ~~May 31, 2019,~~the related disclosures. Under GAAP, certain assets and liabilities must be measured at fair value, and FASB ASC 820-10-50 details the disclosures that are required for items measured at fair value.

The Company has certain financial instruments that must be measured under the new fair value standard. The Company’s financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as follows:

Level 1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company ~~owed F&L Galaxy, Inc.~~has the ability to access at the measurement date.

Level 2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g., ~~(a Company owned~~interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by ~~Mr. Pei), $12,582 and $12,582, respectively for software development expense. The loan is unsecured, non-interest bearing and due on demand.~~observable market data by correlation or other means (market corroborated inputs).

Level 3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or liability.

WEWARDS, INC.

NOTES TO THE FINANCIAL STATEMENTS

~~August 31, 2019~~February 29, 2020

(Unaudited)

AsThe following schedule summarizes the valuation of ~~August 31, 2019~~financial instruments at fair value on a recurring basis in the balance sheets as of February 29, 2020 and May 31, 2019, respectively:


	Fair Value Measurements at February 29, 2020
	Level 1		Level 2			Level 3
Assets
Cash	$	4,249,099	$	—		$	—
Total assets		4,249,099		—			—
Liabilities
Due to related parties		—		225,272			—
Convertible notes payable, related party		—		—			10,500,000
Total liabilities		—		225,272			10,500,000
	$	4,249,099	$	(225,272	)	$	(10,500,000	)


	Fair Value Measurements at May 31, 2019
	Level 1		Level 2			Level 3
Assets
Cash	$	4,508,397	$	—		$	—
Total assets		4,508,397		—			—
Liabilities
Due to related parties		—		225,272			—
Convertible notes payable, related party		—		—			10,500,000
Total liabilities		—		225,272			10,500,000
	$	4,508,397	$	(225,272	)	$	(10,500,000	)

The fair values of our related party debts are deemed to approximate book value, and are considered Level 2 inputs as defined by ASC Topic 820-10-35.

There were no transfers of financial assets or liabilities between Level 1, Level 2 and Level 3 inputs for the ~~Company owed~~period ended February 29, 2020 or the year ended May 31, 2019.

WEWARDS, INC.

NOTES TO THE FINANCIAL STATEMENTS

February 29, 2020

(Unaudited)

NOTE 5 – DUE TO RELATED PARTIES

Due to related parties consists of the following at February 29, 2020 and May 31, 2019, respectively:


	February 29,		May 31,
	2020		2019
Over various dates from December 7, 2015 through February 2, 2016, the Company borrowed funds from EDG Development, a company owned by Mr. Pei. All funds expended to date have been used for professional fees, and for other general operating purposes. The loans are unsecured, non-interest bearing and due on demand. The Company accrues imputed interest at 5% per annum on these advances. As of February 29, 2020, the accrued interest reflects $9,729 of imputed interest on these loans.	$	70,740	$	70,740

On February 22, 2017, the Company borrowed $45,165 from F&L Galaxy, Inc., a company owned by Mr. Pei. All funds expended to date have been used for software development purposes. The loans are unsecured, non-interest bearing and due on demand. The Company accrues imputed interest at 5% per annum on these advances. As of February 29, 2020, the accrued interest reflects $1,730 of imputed interest on these loans.		12,582		12,582

Over various dates from June 24, 2015 through August 8, 2018, the Company borrowed funds from the Company’s CEO, Mr. Pei. All funds expended to date have been used for professional fees, and for other general operating purposes. The loans are unsecured, non-interest bearing and due on demand. The Company accrues imputed interest at 5% per annum on these advances. As of February 29, 2020, the accrued interest reflects $15,239 of imputed interest on these loans.		141,950		141,950

Due to related parties	$	225,272	$	225,272

NOTE 6 – CONVERTIBLE NOTES PAYABLE, RELATED PARTY

Convertible notes payable, related party consists of the following at February 29, 2020 and May 31, 2019, respectively:


	February 29,		May 31,
	2020		2019
On February 26, 2017, Sky Rover Holdings, Ltd (“Sky Rover), which is owned and controlled by Mr. Pei, agreed to loan up $20,000,000 to the Company, of which $8,000,000 was loaned on February 28, 2017. Sky Rover was issued an unsecured, 5%, convertible promissory note which is due on February 26, 2020, and is, in whole or in part, at the option of the holder, convertible into common shares at any time before the due date, at a conversion price of $0.08 per share (subject to adjustment in the event of stock splits, forward splits, recapitalizations, a merger, etc.). At the option of the Company, the interest may also be paid by issuing restricted shares of common stock, at the same conversion price per share. On June 26, 2018, the Company repaid $4,000,000 of principal of this loan. In addition, Sky Rover converted $1,500,000 of principal of this loan into common shares at the conversion price of $0.08 per share into a total of 18,750,000 shares. Sky Rover waived accrued and unpaid interest of $363,904, which was credited to additional paid in capital. As of February 29, 2020, there is $376,454 of accrued interest due on this loan.	$	2,500,000	$	2,500,000

On November 20, 2017, Sky Rover loaned an additional $8,000,000 to the Company. Sky Rover was issued an unsecured, 5%, convertible promissory note which is due on November 20, 2020, and is, in whole or in part, at the option of the holder, convertible into common shares at any time before the due date, at a conversion price of $0.08 per share (subject to adjustment in the event of stock splits, forward splits, recapitalizations, a merger, etc.). At the option of the Company, the interest may also be paid by issuing restricted shares of common stock, at the same conversion price per share. As of February 29, 2020, there is $910,685 of accrued interest on this loan.		8,000,000		8,000,000

Total convertible notes payable, related party		10,500,000		10,500,000
Less: current portion		10,500,000		—
Convertible notes payable, related party, less current portion	$	—	$	10,500,000

WEWARDS, INC.

NOTES TO THE FINANCIAL STATEMENTS

February 29, 2020

(Unaudited)

If Sky Rover converts the remaining $10,500,000 in principal of the Convertible Notes at the present conversion price of $0.08 per share into 131,250,000 shares, those shares, plus the approximate 101,353,450 shares Mr. Pei ~~$141,950~~currently owns, would give him beneficial ownership of 232,603,450 shares of the Company’s 238,733,450 then-issued and ~~$141,950, respectively. All funds expended~~outstanding shares (assuming that no other shares are issued prior to ~~date have been used for professional fees, and for other general operating purposes. The loans are unsecured, non-interest bearing and due on demand.~~conversion), which would approximate 97.4% of the then-outstanding shares.

~~For~~The Company recognized interest expense for the ~~three~~nine months ended ~~August 31,~~February 29, 2020 and February 28, 2019, ~~and 2018, the Company accrued interest at 5% on the above loans for interest expense of $2,398 and $2,398, respectively.~~respectively, as follows:


	February 29,		February 28,
	2020		2019

Interest on due to related parties	$	7,604	$	8,093
Interest on convertible notes, related party		394,110		414,922
Total interest expense	$	401,714	$	423,015

NOTE 7 – COMMITMENTS AND CONTINGENCIES - LEASE

On March 1, 2018, the Company began occupying its ~~new~~current corporate headquarters at 2960 West Sahara Avenue, Las Vegas, NV 89102. The Company signed a five-year sublease with United Power, ~~Inc. (“Power”),~~ an affiliate of the Company by reason of common ownership with Lei Pei, the Company’s sole officer and director and majority shareholder, at a base monthly rent of $15,000, plus a possible increase of up to 3% each year based on increases, if any, of the Consumer Price Index. The building is owned by Future Property Limited, ~~(“Future”),~~ another affiliate of the Company ~~because of~~due to common ~~ownership;~~ownership. Future entered into a lease with United Power, and the Company then sublet the space from United Power. The Company is occupying the space for executive and administrative offices. Rent expense for the three and nine months ended~~August 31,~~February 29, 2020 and February 28, 2019 ~~and 2018~~was $45,000 and ~~$45,000,~~$48,479, and $135,000 and $138,479, respectively.The Company has accounted for the lease under ASC 842, as follows:

~~Convertible Promissory Notes~~

~~February 26, 2017, Sky Rover agreed to loan up to an additional $20,000,000 to the Company,~~The components of which $8,000,000 was loaned on February 28, 2017. Sky Rover was issued an unsecured, 5%, convertible promissory note which is due on February 26, 2020, and is, in whole or in part, at the option of the holder, convertible into common shares at any time before the due date, at a conversion price of $0.08 per share (subject to adjustment in the event of stock splits, forward splits, recapitalizations, a merger, etc.). At the option of the Company, the interest may also be paid by issuing restricted shares of common stock, at the same conversion price per share. On June 26, 2018, the Company repaid the $4,000,000 of the loan. In addition, Sky Rover converted $1,500,000 into the common shares, at the Notes’ conversion price of $.08 per share. As a result of this conversion, the Company issued a total of 18,750,000 shares. Sky Rover waived accrued and unpaid interest of $363,904, which has been credited to additional paid in capital. As of August 31, 2019, there is $2,500,000 and $314,125 of principal and accrued interest, respectively, due on this loan.lease expense were as follows:


	For the Nine
	Months Ended
	February 29,
	2020
Operating lease cost:
Amortization of assets	$	102,822
Interest on lease liabilities		32,178
Total operating lease cost	$	135,000

~~On November 20, 2017, Sky Rover loaned the remaining $8,000,000~~

Supplemental balance sheet information related to ~~the Company. Sky Rover~~leases was issued an unsecured, 5%, convertible promissory note which is due on November 20, 2020, and is, in whole or in part, at the option of the holder, convertible into common shares at any time before the due date, at a conversion price of $0.08 per share (subject to adjustment in the event of stock splits, forward splits, recapitalizations, a merger, etc.). At the option of the Company, the interest may also be paid by issuing restricted shares of common stock, at the same conversion price per share. As of August 31, 2019 there is $711,233 of accrued interest on this loan.as follows:

If and when Sky Rover converts the remaining $10,500,000 of Notes at the present conversion price of $.08 per share to 131,250,000 shares, those shares, plus the approximate 101,353,450 shares Mr. Pei currently owns, would give him beneficial ownership of 232,603,450 of the Company’s 238,733,450 then-issued and outstanding shares (assuming that no other shares are issued before conversion), which would be approximately 97.4% of the then-outstanding shares.


	February 29,
	2020
Operating lease:
Operating lease assets	$	478,677

Current portion of operating lease obligation	$	147,019
Noncurrent operating lease obligation		331,658
Total operating lease obligation	$	478,677

Weighted average remaining lease term:
Operating leases		3.0 years

Weighted average discount rate:
Operating lease		8.00	%

810

WEWARDS, INC.

NOTES TO THE FINANCIAL STATEMENTS

~~August 31, 2019~~February 29, 2020

(Unaudited)

Supplemental cash flow and other information related to operating leases was as follows:


	For the Nine
	Months Ended
	February 29,
	2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows used for operating leases	$	135,000

Future minimum annual lease payments required under the operating lease and the present value of the net minimum lease payments are as follows at February 29, 2020:


For the Fiscal Year	Minimum Lease
Ended May 31:	Commitments
2020 *	$	45,000
2021		180,000
2022		180,000
2023		135,000
Total payments	$	540,000
Amount representing interest	$	(61,323	)
Lease obligation, net		478,677
Less current portion		(147,019	)
Lease obligation – long term	$	331,658

———————

* Liability pertains to the remaining three-month period from March 1, 2020 through May 31, 2020.

NOTE 58 – ~~COMMITMENTS AND CONTINGENCIES~~CHANGES IN STOCKHOLDERS’ EQUITY

~~On March 9, 2018,~~Preferred Stock

The Company has authorized preferred stock of 50,000,000 shares, par value $0.001 per share. The voting powers, conversion features, if any, designations, preferences, limitations, restrictions and other rights of the ~~Company entered into~~preferred stock shall be prescribed by resolution of the Board of Directors at the time a ~~sublease agreement for office space in Las Vegas, NV, with United Power, a related party. The lease~~specific series of preferred stock is ~~considered an operating lease, requires monthly payments~~designated. None of ~~$15,000 and expires March 8, 2023. We~~the preferred shares have ~~accounted for~~been issued as of the ~~lease under ASU 842 Leases, as follows.~~date of this Report.

Balance Sheet Classification

August 31, 2019

Asset


Operating lease asset

Right of use asset

$
509,212

Total lease asset

$
509,212








Liability

Operating lease liability – current portion

Current operating lease liability

$
131,296

Operating lease liability – noncurrent portion

Long-term operating lease liability

377,916

Total lease liability

$
509,212

Common Stock

The Company has 500,000,000 authorized shares of $0.001 par value Common Stock, and had 107,483,450 shares issued and outstanding as of February 29, 2020.

~~Lease obligations at August 31, 2019 consisted of the following:~~

For the year ended May 31:

2020

$
135,000

2021

180,000

2022

180,000

2023

135,000

Total payments

$
630,000

Amount representing interest

$
(120,788
)
Lease obligation, net

509,212

Less current portion

(131,296
)
Lease obligation – long term

$
377,916

The lease expense for the three months ended August 31, 2019 was $45,000 which consisted of amortization expense of $31,221 and interest expense of $13,779 after the adoption of the new lease standard on January 1, 2019.NOTE 9 - INCOME TAX

The ~~cash paid~~Company accounts for income taxes under ~~this operating lease during three~~FASB ASC 740-10, which requires use of the liability method. FASB ASC 740-10-25 provides that deferred tax assets and liabilities are recorded based on the differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes, referred to as temporary differences.

For the nine months ended ~~August~~February 29, 2020 and the year ended May 31, 2019, ~~was $45,000. We have used~~the Company incurred a ~~discount rate~~net operating loss and, accordingly, no provision for income taxes has been recorded. In addition, no benefit for income taxes has been recorded due to the uncertainty of ~~8%.~~the realization of any tax assets. At February 29, 2020, the Company had approximately $6,180,000 of federal net operating losses. The net operating loss carry forwards, if not utilized, will begin to expire in 2034.

Based on the available objective evidence, including the Company’s history of losses, management believes it is more likely than not that the net deferred tax assets will not be fully realizable. Accordingly, the Company provided for a full valuation allowance against its net deferred tax assets at both February 29, 2020 and May 31, 2019.

In accordance with FASB ASC 740, the Company has evaluated its tax positions and determined there are no uncertain tax positions.

WEWARDS, INC.

NOTES TO THE FINANCIAL STATEMENTS

February 29, 2020

(Unaudited)

NOTE 610 – SUBSEQUENT EVENTS

~~In accordance~~On April 2, 2020, the Company purchased intellectual property rights (“IP”) from United Power, a Nevada Corporation under common ownership with ~~SFAS 165 (ASC 855-10) management has performed~~Lei Pei, the Company’s sole officer and director and majority shareholder, for cash consideration of $179,300, based on a price determined by an ~~evaluation~~independent valuation.

The IP consists of ~~subsequent events through~~technology and relatedrights associated with the ~~date that the financial statements were available~~game Megopoly, an MMO (Massively Multiplayer Online Game). Megopoly is expected to be ~~issued~~the first MMO 3-D board game in the world, where players will be able to earn fractions of Bitcoins (satoshi) through buying, selling, and managing virtual real estate properties using in-game currency (Megopoly Coins). The game will be similar in some respects to Monopoly.

The game will allow players around the world to interact with each other online. Players travel (move) through different parts of a city, earning profit by investing in properties, charging rent, acquiring bonus assets, and selling their properties to other players for in-game currency. A player will be able to progress to higher levels of “cities” at any time.

The player’s goal in Megopoly is to earn Megopoly Coins by investing in properties and collecting rent from other players. Players can keep playing the game using their Megopoly Coins for the opportunity to earn more coins, or they can exchange those coins for Bitcoins based on real-time market exchange rates.

Megopoly will be playable at any time through a web browser on a PC, tablet or smart phone, initially in Chinese, and in English in the near future. The game has ~~determined that it does not have any material subsequent events to disclose in these financial statements.~~been designed for players of all skill levels.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The information contained in this Form 10-Q is intended to update the information contained in our Annual Report on Form 10-K for the year ended May 31, 2019 and presumes that readers have access to, and will have read, the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and other information contained in such Form 10-K. The following discussion and analysis also should be read together with our financial statements and the notes to the financial statements included elsewhere in this Form 10-Q.

The following discussion contains certain statements that may be deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements appear in a number of places in this Report, including, without limitation, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” These statements are not guarantees of future performance and involve risks, uncertainties and requirements that are difficult to predict or are beyond our control. Forward-looking statements speak only as of the date of this quarterly report. You should not put undue reliance on any forward-looking statements. We strongly encourage investors to carefully read the factors described in our Annual Report on Form 10-K for the year ended May 31, 2019 in the section entitled “Risk Factors” for a description of certain risks that could, among other things, cause actual results to differ from these forward-looking statements. We assume no responsibility to update the forward-looking statements contained in this quarterly report on Form 10-Q. The following should also be read in conjunction with ~~our condensed financial statements, including~~ the unaudited Financial Statements and notes thereto ~~appearing~~that appear elsewhere in this ~~quarterly~~ report. ~~The following discussion contains forward-looking statements that reflect our plans, estimates and beliefs. Our actual results could differ materially from those discussed~~

Overview

Wewards, Inc. (“Wewards” or “the Company”) was incorporated in the ~~forward-looking statements. Factors that could cause or contribute~~state of Nevada on September 10, 2013 as Betafox Corp., with the initial intent to manufacture and sell color candles. On April 26, 2015, Giorgos Kallides (the “Seller”), entered into an agreement with Future Continental Limited (“Purchaser”), pursuant to which, on May 11, 2015, the Seller sold to Purchaser six million (6,000,000) shares of common stock of the Company (the “Shares”) owned by the Seller, constituting approximately 73.8% of the Company’s 8,130,000 issued and outstanding common shares at such ~~differences include, but are not limited~~time, for $340,000.In October 2015, the Purchaser sold the 6,000,000 Shares to ~~those discussed below~~Mr. Lei Pei, an affiliate of the Purchaser, in consideration of Mr. Pei’s agreement to serve as our director and ~~elsewhere~~CEO.On January 8, 2018, by consent of Lei Pei as the Company’s principal shareholder, the Company changed its name to Wewards, Inc. The Company’s corporate office is located in ~~this Quarterly Report ". Our unaudited condensed financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.~~

~~RESULTS OF OPERATIONS~~Las Vegas, Nevada.

The Company has developed and is the owner of a web-based platform accessible by mobile apps (the “Platform”) that will enable consumers to purchase goods from merchants and earn rebates payable in the form of Bitcoin.The Platform provides an innovative Bitcoin rewards ecosystem. It is designed to transform traditional concepts of commerce into a cooperative society where both merchants and consumers are collaborating, utilizing Bitcoin to reward consumers. The ecosystem provides consumers with rewards each time they complete a challenge defined by a merchant. This is intended to make the ecommerce process beneficial to all market participants, and to help distribute commercial wealth among and between the merchants and consumers. The Company intends to generate revenue by licensing “white-label” versions of the Platform to third parties. However, to date, no such license agreement has been entered into, and the Company has not generated any revenues.

On April 2, 2020, the Company purchased intellectual property rights (“IP”) from United Power, a Nevada Corporation under common ownership with Lei Pei, the Company’s sole officer and director and majority shareholder, for cash consideration of $179,300, based on a price determined by an independent valuation.

The IP consists of technology and relatedrights associated with the game Megopoly, an MMO (Massively Multiplayer Online Game). Megopoly is expected to be the first MMO 3-D board game in the world, where players will be able to earn fractions of Bitcoins (satoshi) through buying, selling, and managing virtual real estate properties using in-game currency (Megopoly Coins). The game will be similar in some respects to Monopoly.

Megopoly will be playable at any time through a web browser on a PC, tablet or smart phone, initially in Chinese, and in English in the near future. The game has been designed for players of all skill levels.

Results of Operations for the Three Months ~~ended August 31, 2019 Compared to the Three Months ended August 31, 2018~~Ended February 29, 2020 and February 28, 2019:

~~Operating Expenses~~

~~During~~The following table summarizes selected items from the statement of operations for the three months ended ~~August 31, 2019, we incurred total operating~~February 29, 2020 and February 28, 2019.


	Three Months Ended
	February 29,			February 28,			Increase /
	2020			2019			(Decrease)
Revenues	$	—		$	—		$	—

Operating expenses:
General and administrative		3,142			88,448			(85,306	)
Rent expense, related party		45,000			48,479			(3,479	)
Professional fees		15,250			101,100			(85,850	)
Total operating expenses:		63,392			238,027			(174,635	)

Operating loss		(63,392	)		(238,027	)		(174,635	)

Total other income		(116,311	)		(109,004	)		7,307

Net loss	$	(179,703	)	$	(347,031	)	$	(167,328	)

Revenues

We have not generated any revenues to date.

General and Administrative Expenses

General and administrative expenses ~~of $236,703~~for the three months ended February 29, 2020 were $3,142, compared to ~~$355,958 incurred~~$88,448 during the three months ended ~~August 31, 2018. Operating~~February 28, 2019, a decrease of $85,306, or 96%. The expenses ~~consist~~consisted primarily of office, travel, compliance and business development expenses. General and administrative expense decreased during the ~~following.~~current period due to decreased business development expenses.

~~During~~Rent Expense, Related Party

Related party rent expense for the three months ended ~~August 31, 2019, we incurred related party rent expense of~~February 29, 2020 was $45,000, compared to ~~$45,000 incurred~~$48,479 during the three months ended ~~August 31, 2018. Our sublease for~~February 28, 2019, a decrease of $3,479, or 7%. Related party rent expense decreased slightly due to rent expense related to a small satellite office ~~space began~~that was leased in ~~March 2018.~~the comparative period that is no longer rented by the Company.

~~During~~Professional Fees

Professional fees for the three months ended ~~August 31, 2019, we incurred general and administrative (“G&A”) expenses of $191,703~~February 29, 2020 were $15,250, compared to ~~$310,958 incurred~~$101,100 during the three months ended ~~August 31, 2018,~~February 28, 2019, a decrease of ~~$119,255~~$85,850, or ~~38.3%~~85%. ~~G&A expenses have decrease largely~~Professional fees decreased primarily due to ~~a decrease~~cost savings related to transitioning to new compliance team members and reductions in ~~consulting expense and other professional fees.~~fees paid to software developers during the current period.

~~Other Expense~~

~~During the three months ended August 31, 2019, we incurred interest expense of $134,727 compared to $157,877 incurred during the three months ended August 31, 2018,~~a decrease of $23,150, or 14.6%. Interest expense is due to the convertible promissory notes with Sky Rover Holdings, Ltd. And other related party loans (Note 4) and has decreased due to the conversion of and repayment of some of those notes.Operating Loss

~~During the three months ended August 31, 2019, we had interest income of $21,754 compared to $13,119 during the three months ended August 31, 2018.~~

~~Net Loss~~

Our ~~net~~operating loss for the three months ended ~~August 31, 2019~~February 29, 2020 was ~~$349,676,~~$63,392, compared to ~~a net loss of $500,716 for~~$238,027 during the ~~prior~~ three months ended ~~August 31, 2018.~~February 28, 2019, a decrease of $174,635, or 73%. Our operating loss decreased primarily due to cost savings related to reductions in business development fees, transitioning to new compliance team members and reductions in fees paid to software developers during the current period.

Other Income (Expense)

Other expense, on a net basis, for the three months ended February 29, 2020 was $116,311, compared to other expense, on a net basis, of $109,004 during the three months ended February 28, 2019, an increase of $7,307, or 7%. Other expense consisted of $133,699 of interest expense on related party loans, as offset by $17,388 of interest income for the three months ended February 29, 2020. Other expense consisted of $131,850 of interest expense on related party loans, as offset by $22,846 of interest income for the three months ended February 28, 2019. Other expense, on a net basis, increased due to slightly increased interest expense and diminished interest income on cash balances.

Net Loss

Net loss for the three months ended February 29, 2020 was $179,703, compared to $347,031 during the three months ended February 28, 2019, a decrease of $167,217, or 48%. The ~~decrease in~~decreased net loss ~~is a result of~~was due to cost savings related to reductions in business development fees, transitioning to new compliance team members and reductions in fees paid to software developers during the ~~decrease in G & A expense.~~

~~LIQUIDITY AND CAPITAL RESOURCES~~current period.

Results of Operations for the Nine Months Ended February 29, 2020 and February 28, 2019:

The following table summarizes selected items from the statement of operations for the nine months ended February 29, 2020 and February 28, 2019.

Nine Months Ended

February 29,

February 28,

Increase /

2020

2019

(Decrease)

Revenues

$
—

$
—

$
—

Operating expenses:

General and administrative

6,088

485,671

(479,583
)
Rent expense, related party

135,000

138,479

(3,479
)
Professional fees

232,325

306,497

(74,172
)
Total operating expenses:

373,413

930,647

(557,234
)

Operating loss

(373,413
)

(930,647
)

(557,234
)

Total other income

(342,481
)

(369,019
)

(26,538
)

Net loss

$
(715,894
)

$
(1,299,666
)

$
(583,772
)

Revenues

We have not generated any revenues to date.

General and Administrative Expenses

General and administrative expenses for the nine months ended February 29, 2020 were $6,088, compared to $485,671 during the nine months ended February 28, 2019, a decrease of $479,583, or 99%. The expenses consisted primarily of office, travel, compliance and business development expenses. General and administrative expense decreased during the current period due to decreased business development expenses.

Rent Expense, Related Party

Related party rent expense for the nine months ended February 29, 2020 was $135,000, compared to $138,479 during the nine months ended February 28, 2019, a decrease of $3,479, or 3%. Related party rent expense decreased slightly due to rent expense related to a small satellite office that was leased in the comparative period that is no longer rented by the Company.

Professional Fees

Professional fees for the nine months ended February 29, 2020 were $232,325, compared to $306,497 during the nine months ended February 28, 2019, a decrease of $74,172, or 24%. Professional fees decreased primarily due to cost savings related to transitioning to new compliance team members and reductions in fees paid to software developers during the current period.

Operating Loss

Our operating loss for the nine months ended February 29, 2020 was $373,413, compared to $930,647 during the nine months ended February 28, 2019, a decrease of $557,234, or 60%. Our operating loss decreased primarily due to cost savings related to reductions in business development fees, transitioning to new compliance team members and reductions in fees paid to software developers during the current period.

Other Income (Expense)

Other expense, on a net basis, for the nine months ended February 29, 2020 was $342,481, compared to other expense, on a net basis, of $369,019 during the nine months ended February 28, 2019, a decrease of $26,538, or 7%. Other expense consisted of $401,714 of interest expense on related party loans, as offset by $59,233 of interest income for the nine months ended February 29, 2020. Other expense consisted of $423,015 of interest expense on related party loans, as offset by $53,996 of interest income for the nine months ended February 28, 2019. Other expense, on a net basis, decreased due to slightly decreased interest expense and increased interest income on cash balances.

Net Loss

Net loss for the nine months ended February 29, 2020 was $715,894 compared to $1,299,666 during the nine months ended February 28, 2019, a decrease of $583,772, or 45%. The decreased net loss was due to cost savings related to reductions in business development fees, transitioning to new compliance team members and reductions in fees paid to software developers during the current period.

Liquidity and Capital Resources

The following is a summary of the Company’s cash flows used in operating, investing, and financing activities for the nine-month periods ended February 29, 2020 and February 28, 2019:

2020

2019

Operating Activities

$
(259,298
)

$
(762,459
)
Investing Activities

—

(432,200
)
Financing Activities

—

(4,965,000
)
Net Increase (Decrease) in Cash

$
(259,298
)

$
(6,159,659
)

Cash Flows from Operating Activities

We have not generated positive cash flows from operating activities. During the ~~three~~nine months ended ~~August 31,~~February 29, 2020, net cash flows used in operating activities was $259,298. For the same period ended February 28, 2019, net cash flows used in operating activities was ~~$190,179. For the same period ended August 31, 2018, net~~$762,459. The decrease in cash ~~flows~~ used in operating activities ~~was $370,233.~~is primarily attributable to our decreased net loss.

Cash Flows from Investing Activities

During the ~~three~~nine months ended ~~August 31, 2019,~~February 29, 2020, we ~~used $0~~did not use any cash in investing activities compared to $432,200 for the same period ended ~~August 31, 2018.~~February 28, 2019. The decrease is attributable to investments made in intangible assets in the prior period that was not necessary in the current period.

Cash Flows from Financing Activities

For the ~~three~~nine months ended ~~August 31, 2019, net~~February 29, 2020, we did not use any cash ~~used~~ in financing ~~activities was $0.~~activities. For the ~~three~~nine months ended ~~August 31, 2018,~~February 28, 2019, net cash used in financing activities was $4,965,000. In ~~2018,~~the comparative period, $35,000 was received by way of a loan from our sole officer, director and principal shareholder, and the Company repaid $5,000,000 on ~~the~~ related party loans. ~~(see Note 4)~~

~~As of August 31, 2019, the company had cash of $4,318,218 to be used for operation over at least the next twelve months.~~

~~PLAN OF OPERATION AND FUNDING~~Ability to Continue as a Going Concern

As of February 29, 2020, we had available cash of $4,249,099, current liabilities of $12,216,340 and had never generated any revenues. These conditions, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that may result from the outcome of these uncertainties. Unless and ~~until we acquire an ongoing business~~,or until we begin to generate revenues and positive cash flow from ~~the merchant platform~~our Platform or ~~the~~Megopoly game, ~~platform,~~ as to which there is no assurance, we expect that working capital requirements will continue to be funded through cash on hand, related party loans and/or further issuances of other securities. There is no assurance that we will be able to meet our working capital requirement from ~~either possible source.~~these sources.

We have no lines of credit or other bank financing arrangements. To date, we have been wholly dependent upon our CEO and majority shareholder, Mr. Pei, and his affiliated companies, to provide financing to us, generally in the ~~Registrant, most~~form of ~~the time via~~ convertible loans. Additional issuances of equity or convertible debt securities will result in dilution to our current shareholders. Further, such securities might have rights, preferences or privileges senior to our common stock. Additional financing may not be available upon acceptable terms, or at all. If adequate funds are not available or are not available on acceptable terms, we may not be able to take advantage of prospective new business endeavors or opportunities, and we might be unable to continue in business.

As of the date of the filing of this Quarterly Report on Form 10-Q, the merchant platform has been completely developed, and the Company owns this technology; however, no licensee has yet been signed by the Company, and no revenues have been generated. The game platform described above has not yet been completed and is not operational.

~~MATERIAL COMMITMENTS~~Material Commitments

As of the date of this Quarterly Report, we do not have any material commitments.

~~PURCHASE OF SIGNIFICANT EQUIPMENT~~Purchase of Significant Equipment

We do not have any agreements at this time, to purchase any significant equipment during the next twelve months.

~~OFF-BALANCE SHEET ARRANGEMENTS~~Off-Balance Sheet Arrangements

As of the date of this Quarterly Report, 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, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that are material to investors.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires our management to make assumptions, estimates and judgments that affect the amounts reported, including the notes thereto, and related disclosures of commitments and contingencies, if any. We have identified certain accounting policies that are significant to the preparation of our financial statements. These accounting policies are important for an understanding of our financial condition and results of operations. Critical accounting policies are those that are most important to the presentation of our financial condition and results of operations and require management’s subjective or complex judgment, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods. Certain accounting estimates are particularly sensitive because of their significance to financial statements and because of the possibility that future events affecting the estimate may differ significantly from management’s current judgments.

While our significant accounting policies are more fully described in notes to our consolidated financial statements appearing elsewhere in this Form 10-Q, we believe that the following accounting policies are the most critical to aid you in fully understanding and evaluating our reported financial results and affect the more significant judgments and estimates that we used in the preparation of our financial statements.

Concentrations of Credit Risk

The Company maintains our cash in bank deposit accounts, the balances of which at times may exceed federally insured limits. Accounts are guaranteed by the Federal Deposit Insurance Corporation (FDIC) up to $250,000 under current regulations. The Company had approximately $3,999,199 and $4,258,497 in excess of FDIC insured limits at February 29, 2020 and May 31, 2019, respectively. The Company has not experienced any losses in such accounts.

Reclassifications

In the current period, the Company separately classified professional fees from general and administrative expenses in the Condensed Statement of Operations. For comparative purposes, amounts in the prior period have been reclassified to conform to the current period presentation. These reclassifications had no effect on previously reported results of operations.

Software Development Costs

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

We are a smaller reporting company as defined in Rule 12b-2 of the Exchange Act and are not required to provide the information required under this item.

ITEM 4. CONTROLS AND PROCEDURES

~~EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES~~Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and our Chief Financial Officer, who is one in the same, evaluated the effectiveness of our disclosure controls and procedures as of February 29, 2020. The term “disclosure controls and ~~procedures” (defined~~procedures,” as defined in ~~SEC Rule~~Rules 13a-15(e)~~) refers to~~ and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the ~~Securities~~ Exchange Act ~~of 1934 (the “Exchange Act”)~~ is recorded, processed, summarized and reported, within ~~required~~the time ~~periods. “Disclosure~~periods specified in the SEC's rules and forms. Disclosure controls and ~~procedures”~~procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the ~~Company’s~~company's management, including its principal executive and principal financial officers, ~~or persons performing similar functions,~~ as appropriate to allow timely decisions regarding required disclosure.

~~The Company’s~~ Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives, and management necessarily applies its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Based on the evaluation of our disclosure controls and procedures as of February 29, 2020, our Chief Executive Officer and Chief Financial Officer has evaluated the effectiveness of the Company’s disclosure controls and procedures as of the end of the period covered by this quarterly report (the “Evaluation Date”). Based on that evaluation, the Company’s Chief Executive Officer and Chief Financial Officer noted the deficiencies in internal controls identified in this Item 4. Accordingly, the Company’s Chief Executive Officer and Chief Financial Officer has concluded that, as of ~~the Evaluation Date,~~ such date, our disclosure controls and procedures were not ~~effective.~~effective at the reasonable assurance level due to the material weaknesses identified and described in Item 9A of our Annual Report on Form 10-K for the fiscal year ended May 31, 2019 under “Evaluation of Disclosure Controls and Procedures”.

Changes in Internal Control over Financial Reporting

~~Management is responsible for establishing and maintaining adequate~~

There have been no significant changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act Rule 13a-15(f)). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposesAct) or in accordance with accounting principles generally accepted in the United States of America. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. 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. Under the supervision and with the participation of management, including the Chief Executive Officer and Chief Financial Officer, the Company conducted an evaluation of the effectiveness of the Company’s internal control over financial reporting as of August 31, 2019 using the criteria established in the 2013 version of “Internal Control - Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission ("COSO").

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis. In its assessment of the effectiveness of internal control over financial reporting as of August 31, 2019, the Company determined that there were control deficiencies that constituted material weaknesses, as described below.


	1.	We do not have an Audit Committee – While not being legally obligated to have an audit committee, it is management’s view that such a committee, including a financial expert member, is an utmost important entity level control over the Company’s financial statement. Currently the single-member Board of Directors acts in the capacity of the Audit Committee and does not include a member that is considered to be independent of management to provide the necessary oversight over management’s activities.

	2.	We did not maintain appropriate cash controls – As of August 31, 2019, the Company has not maintained sufficient internal controls over financial reporting for the cash process, including failure to segregate cash handling and accounting functions, and did not require dual signature on the Company’ s bank accounts.

	3.	~~Lack of segregation of duties—We currently have no employees other than our CEO and CFO—the same person. Therefore, all accounting information is currently reviewed only by one person.~~

Accordingly, the Company concluded that these control deficiencies resulted in a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis by the Company’s internal controls.

As a result of the material weaknesses described above, management has concluded that the Company did not maintain effective internal control over financial reporting as of August 31, 2019, based on criteria established in Internal Control Integrated Framework issued by COSO. The Company has adopted new procedures, which were approved by the Board of Directors on September 14, 2018, and were filed as an Exhibit to the Company’s Annual Report, which was filed with the SEC on September 20, 2018.

~~Changes in Internal Control over Financial Reporting~~

There has been no change in our internal control over financial reporting identified in connection with our evaluation we conducted of the effectiveness of our internal control over financial reporting as of August 31, 2019,other factors that occurred during the period of our ~~second fiscal quarter that has~~evaluation or subsequent to the date we carried out our evaluation which have materially affected, or isare reasonably likely to materially affect, our internal control over financial reporting. ~~However, as noted above, on September 14, 2018, the Company adopted new~~The design of any system of controls and procedures ~~which were approved by~~is based in part upon certain assumptions about the ~~Board~~likelihood of ~~Directors on September 14, 2018,~~future events. There can be no assurance that any system of controls and ~~were filed as an Exhibit to the Company’s Annual Report, which was filed with the SEC on September 20, 2018.~~procedures will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We ~~know of no material, existing~~are not a party to any legal or ~~pending legal~~administrative proceedings ~~against our Company, nor are~~that we ~~involved as a plaintiff~~believe, individually or in ~~any material proceeding or pending litigation. There are no proceedings in which any of our directors, officers or affiliates, or any registered or beneficial shareholder, is an adverse party or has~~the aggregate, would be likely to have a material ~~interest~~ adverse toeffect on our ~~interest.~~financial condition or results of operations.

ITEM 1A. RISK FACTORS

~~We are~~As a ~~smaller~~“smaller reporting ~~company as defined by Rule 12b-2 of~~company”, the ~~Securities Exchange Act of 1934 and, as such, are~~Company is not required to provide the information ~~under~~required by this Item.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

~~None.~~On April 2, 2020, the Company purchased intellectual property rights (“IP”) from United Power, a Nevada Corporation under common ownership with Lei Pei, the Company’s sole officer and director and majority shareholder, for cash consideration of $179,300, based on a price determined by an independent valuation.

ITEM 6. EXHIBITS

The following exhibits are included as part of this report by reference:


Exhibit
Number		~~Name~~Description

~~31.1~~10.1*		Intellectual Property Rights and Transfer Agreement between Wewards, Inc. and United Power, Inc. dated April 2, 2020
31.1*		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Securities Exchange Act of 1934 Rule 13a-14(a) or 15d-14(a).

~~32.1~~32.1*		Certification pursuant to Securities Exchange Act of 1934 Rule 13a-14(b) or 15d-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002.
101.INS*		XBRL Instance Document
~~101~~101.SCH*		~~Interactive data files pursuant to Rule 405 of Regulation S-T.~~XBRL Schema Document
101.CAL*		XBRL Calculation Linkbase Document
101.DEF*		XBRL Definition Linkbase Document
101.LAB*		XBRL Labels Linkbase Document
101.PRE*		XBRL Presentation Linkbase Document

* Filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


	WEWARDS, INC.

Date: ~~October 11, 2019~~April 7, 2020	By:	/s/ Lei Pei
		Lei Pei
		President, ~~and~~ Chief Executive Officer and Chief Financial Officer



	August 31, 2019			May 31, 2019
ASSETS
Current Assets:
Cash	$	4,318,218		$	4,508,397
Prepaid expenses		—			25,000
Total current assets		4,318,218			4,533,397
Right of use asset		509,212			540,433
Total Assets	$	4,827,430		$	5,073,830

LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current Liabilities:
Accounts payable	$	100		$	329
Accrued interest - related party		1,046,850			912,123
Due to related parties		225,272			225,272
Operating lease obligation		131,296			128,705
Total Current Liabilities		1,403,518			1,266,429

Long Term Liabilities:
Convertible Notes Payable - related party		10,500,000			10,500,000
Operating lease obligation – noncurrent portion		377,916			411,729

Total Liabilities		12,281,434			12,178,158

Stockholders’ Deficit:
Preferred stock, par value $0.001; 50,000,000 shares authorized, no shares issued		—			—
Common stock, par value $0.001; 500,000,000 shares authorized, 107,483,450 and 107,483,450 shares issued and outstanding; respectively		107,483			107,483
Additional paid in capital		5,083,348			5,083,348
Accumulated deficit		(12,644,835	)		(12,295,159	)
Total Stockholders’ Deficit		(7,454,004	)		(7,104,328	)
Total Liabilities and Stockholders’ Deficit	$	4,827,430		$	5,073,830


	For the Three Months Ended August 31,
	2019			2018
Revenue	$	—		$	—

Operating Expenses:
General and administrative		191,703			223,458
General and administrative – related party		—			87,500
Rent expense – related party		45,000			45,000

Total expenses		236,703			355,958

Other income (expense):
Interest expense– related party		(134,727	)		(157,877	)
Interest income		21,754			13,119
Total other expense		(112,973	)		(144,758	)

Loss before provision for income taxes		(349,676	)		(500,716	)

Provision for Income Taxes		—			—

Net Loss	$	(349,676	)		(500,716	)

Net loss per share, basic and diluted	$	(0.00	)	$	(0.00	)
Weighted average shares outstanding, basic and diluted		107,483,450			102,184,537


	Preferred Stock				Common Stock				Additional Paid in		Accumulated
	Shares		Amount		Shares		Amount		Capital		Deficit			Total
Balance at May 31, 2018		—		—		88,733,450		88,733		3,171,197		(9,910,942	)		(6,651,012	)

Stock issued for conversion of debt – related party		—		—		18,750,000		18,750		1,481,250		—			1,500,000

Forgiveness of accrued interest – related party		—		—		—		—		430,902		—			430,902

Net loss		—		—		—		—		—		(500,716	)		(500,716	)

Balance at August 31, 2018		—	$	—		107,483,450	$	107,483	$	5,083,349	$	(10,411,658	)	$	(5,220,826	)


	Balance Sheet Classification	August 31, 2019
Asset
Operating lease asset	Right of use asset	$	509,212
Total lease asset		$	509,212

Liability
Operating lease liability – current portion	Current operating lease liability	$	131,296
Operating lease liability – noncurrent portion	Long-term operating lease liability		377,916
Total lease liability		$	509,212


For the year ended May 31:
2020	$	135,000
2021		180,000
2022		180,000
2023		135,000
Total payments	$	630,000
Amount representing interest	$	(120,788	)
Lease obligation, net		509,212
Less current portion		(131,296	)
Lease obligation – long term	$	377,916


	Nine Months Ended
	February 29,			February 28,			Increase /
	2020			2019			(Decrease)
Revenues	$	—		$	—		$	—

Operating expenses:
General and administrative		6,088			485,671			(479,583	)
Rent expense, related party		135,000			138,479			(3,479	)
Professional fees		232,325			306,497			(74,172	)
Total operating expenses:		373,413			930,647			(557,234	)

Operating loss		(373,413	)		(930,647	)		(557,234	)

Total other income		(342,481	)		(369,019	)		(26,538	)

Net loss	$	(715,894	)	$	(1,299,666	)	$	(583,772	)


	2020			2019
Operating Activities	$	(259,298	)	$	(762,459	)
Investing Activities		—			(432,200	)
Financing Activities		—			(4,965,000	)
Net Increase (Decrease) in Cash	$	(259,298	)	$	(6,159,659	)