Large accelerated filer ☐ | Accelerated filer ☐ | |
Non-accelerated filer ☐ | Smaller reporting company ý | |
(Do not check if smaller reporting company) | Emerging growth company ý |
Title of Each Class of Securities To be Registered | Amount to be Registered | Proposed Maximum Offering Price Per Share | Proposed Maximum Aggregate Offering Price | Amount of Registration Fee | ||||||||||||
Common Stock | 3,000,000 | $ | 1.00 | $ | 3,000,000 | $ | 373.50 | |||||||||
Common Stock1 | 3,646,890 | $ | 0.50 | $ | 1,823,445 | $ | 227.02 | |||||||||
Total | 6,646,890 | $ | $ | 4,832,445 | $ | 600.52 |
(1) | Shares offered by Selling Shareholders previously issued in a private offering of securities pursuant to Section 4(2) of the Securities Act; these shares were issued at prices at $.0025, $0.11 and $0.50 per share. |
PROSPECTUS SUMMARY | 5 |
RISK FACTORS | 8 |
USE OF PROCEEDS | 27 |
DETERMINATION OF OFFERING PRICE | 30 |
DILUTION | 30 |
SELLING SHAREHOLDERS | 33 |
PLAN OF DISTRIBUTION | 35 |
DESCRIPTION OF SECURITIES | 39 |
DESCRIPTION OF BUSINESS | 42 |
RELATED STOCKHOLDER MATTERS | 54 |
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | 55 |
DIRECTORS, EXECUTIVE OFFICERS, PROMOTER AND CONTROL PERSONS | 59 |
EXECUTIVE COMPENSATION | 62 |
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT | 63 |
DISCLOSURE OF COMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES | 66 |
INTEREST OF NAMED EXPERTS | 66 |
WHERE YOU CAN FIND MORE INFORMATION | 66 |
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE | 67 |
FINANCIAL STATEMENTS | F-1 |
PROSPECTUS SUMMARY As used in this prospectus, references to the "Company," "we," "our", "us" or "Wigi" refer to Wigi Blockchain Technologies, Inc. unless the context otherwise indicates. The following summary highlights selected information contained in this prospectus. Before making an investment decision, you should read the entire prospectus carefully, including the "Risk Factors" section, the financial statements, and the notes to the financial statements. Our Company Wigi Blockchain Technologies, Inc., an Oklahoma corporation incorporated on August 10, 2017, is a payments technology company that is developing a payments platform knowns as "WigiPay" that will utilize blockchain technologies. From inception until the date of this filing our operating activities have primarily consisted of (i) the incorporation of our company, (ii) the development of our business plan, (iii) the acquisition of the source code for the Wigi software platform, (iv) the initial equity funding, (v) the development of WigiPay through conceptually setting out the use of WigiPay points and how the overall platform will function. The Company intends to develop a blockchain payments platform using fiat currency as opposed to the many other cryptocurrencies. In order to do that, the Company intends to implement WigiPay points which will allow payments to be made using blockchain technology. Each WigiPay point will represent the 1 fiat currency in the local currency. For example, in the United States, 1 WigiPay point will represent 1 U.S. dollar. In order to implement blockchain technology into the payments industry while using fiat currency, the Company intends to use WigiPay points . WigiPay is intended to give retail and e-commerce the ability to lower the cost of payments, eliminate fraud and deliver an automated and integrated rewards system. WigiPay is intended to be a consumer-focused payment platform that when fully developed will provide consumers with multiple payment options. As the platform evolves, it will allow for cash, credit cards, debit cards, gift cards, cryptocurrencies, as well as loyalty/rewards transactions. WigiPay will be developed to allow for the transfer of cash from a user's account into his or her WigiPay account. From there, users can buy goods and/or services online. In addition, we intend to provide retail and e-commerce businesses the ability to accept payments utilizing WigiPay points via our WigiPay payments system, which will charge a fee on every transaction made through our application. This is intended to provide a larger customer base to businesses while also lowering the payment processor transaction costs. Wigi believes that consumers, merchants and merchant network platform providers, can simultaneously benefit with its WigiPay payment system, which will use blockchain technology. Wigi believes it can disrupt legacy payments industry systems, which are costly for merchants (and ultimately for consumers), especially when fraud and chargebacks are included. Our products will include the WigiPay mobile app for consumers and WigiPOS merchant dashboard. When used in tandem, consumers will be able to pay for products and services at lower costs while merchants will benefit from an automated rewards system that result in greater consumer retention and satisfaction. Wigi intends to modernize legacy payments by utilizing blockchain technology with fiat currency. We have not realized any revenues to date. We are in the early stages of developing our business. We intend to be in the business of providing retail and e-commerce companies the ability to accept WigiPay points using a blockchain based payment platform. |
The goal is to create blockchain based payment platform that focuses primarily on fiat as opposed to the many other digital currencies. Our plan of operations over the 12-month period following the successful completion of our offering of 3,000,000 shares of our common stock is to complete development and marketing of our ecommerce blockchain products. The Company's principal office is located at 8F Iwasaki Building. 1-7-2 Asakusabashi, Taito-ku, Tokyo-to, Japan 111-0053. Our telephone number is 81 90-9954-2711. We are an "emerging growth company" within the meaning of the federal securities laws. For as long as we are an emerging growth company, we will not be required to comply with the requirements that are applicable to other public companies that are not "emerging growth companies" including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, the reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and the exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We intend to take advantage of these reporting exemptions until we are no longer an emerging growth company. This is a direct participation offering since we are offering the stock directly to the public without the participation of an underwriter. Our officers and directors will be solely responsible for selling shares under this offering and no commission will be paid on any sales. There has been no market for our securities and a public market may never develop, or, if any market does develop, it may not be sustained. Our common stock is not traded on any exchange or on the over-the-counter market. After the effective date of the registration statement relating to this prospectus, we intend to seek to have a market maker file an application with the Financial Industry Regulatory Authority ("FINRA") for our common stock to be eligible for trading on the Over-the-Counter Bulletin Board. We do not yet have a market maker who has agreed to file such application. There can be no assurance that our common stock will ever be quoted on a stock exchange or a quotation service or that any market for our stock will develop. You should rely only on the information contained in this prospectus. We have not authorized anyone to provide you with information different from that contained in this prospectus. The information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of any sale of our common shares. |
Securities Being Offered: | 3,000,000 shares of common stock, par value $0.001 per share. | |
Offering price | $1.00 per share | |
Duration of the Offering: | The 3,000,000 shares of common stock are being offered for a period of 18 months. | |
Net proceeds to us | $3,000,000 assuming the maximum number of shares sold. For further information on the Use of Proceeds, see page 26. | |
Shares Outstanding Prior to Offering | 9,046,890 shares of common stock. | |
Shares Outstanding After Offering | 12,046,890 shares of common stock. | |
Subscriptions | All subscriptions once accepted by us are irrevocable. | |
Registration Costs | All registration costs shall be borne by the Company | |
Risk Factors | See "Risk Factors" and the other information in this prospectus for a discussion of the factors you should consider before deciding to invest in shares of our common stock. | |
Going Concern | Our financial statements from inception on August 10, 2017 through our fiscal period ended March 31, 2018 report no revenues and a net loss of $108,918. Our independent auditor has issued an audit opinion for our Company which includes a statement expressing substantial doubt as to our ability to continue as a going concern. |
a. | BitPay is a private global bitcoin payment service provider headquartered in Atlanta, Georgia; |
b. | PayPal (NASDAQ: PYPL) is an international e-commerce business allowing payments and money transfers to be made through the Internet. PayPal is one of the largest financial transaction tools available online. PayPal is a leader in online commerce; |
c. | POSaBIT is a private Seattle, Washington based company that gives consumers easy access to digital currency by allowing them to purchase it during the retail experience. These digital wallets can be used to make purchases on the spot or anywhere that accepts cryptocurrency such as Amazon.com, Overstock.com, Expedia.com, and more; and |
d. | Shakepay is a Canadian private company that enables payments using bitcoin, ethereum and dash digital currencies via a standard Visa debit card where instantaneous transaction times are required and through Shakepay's agents for transaction of up to $2 million in cryptocurrency where longer transaction times are acceptable. |
· | fire; | |
· | power loss; | |
· | earthquake; | |
· | terrorist attacks; | |
· | natural disasters; | |
· | computer viruses; | |
· | unauthorized entry; |
· | telecommunications failure; and | |
· | computer denial of service attacks. |
The Company's infrastructure could prove unable to handle a larger volume of customer transactions. Any failure to accommodate transaction growth could impair customer satisfaction, lead to a loss of customers, impair the Company's ability to add customers or increase its costs, all of which would harm its business.
· | paper-based transactions (principally cash and checks); |
· | providers of traditional payment methods, particularly credit and debit cards, money orders, and Automated Clearing House transactions (these providers are primarily well-established banks); |
· | providers of "digital wallets" which offer customers the ability to pay online and/or on mobile devices through a variety of payment methods, including with mobile applications, through contactless payments, and with a variety of payment methods; |
· | providers of mobile payments solutions that use tokenized card data approaches and Near Field Communication ("NFC") functionality (including Host Based Card Emulation ("HCE") functionality to eliminate the need for a physical NFC chip in the device); |
· | payment-card processors that offer their services to merchants; |
· | providers of "person-to-person" payments that facilitate individuals sending money with an email address or mobile phone number; |
· | providers of mobile payments; and |
· | providers of card readers for mobile devices and of other new point of sale and multi-channel technologies. |
· | money remitters; |
· | services that provide online merchants the ability to offer their customers the option of paying for purchases from their bank account or paying on credit; |
· | issuers of stored value targeted at online payments; |
· | other international online payment-services providers; |
· | other providers of online account-based payments; |
· | payment services targeting users of social networks and online gaming, often through billing to the consumer's mobile phone account; |
· | mobile payment services between bank accounts; |
· | payment services enabling banks to offer their online banking customers the ability to send and receive payments through their bank account; |
· | online shopping services that provide special offers linked to a specific payment provider; and |
· | services that help merchants accept and manage virtual currencies. |
· | ability to attract, retain and engage both merchants and consumers with relatively low marketing expense; |
· | security of transactions and the ability for consumers to use the Company's services without sharing their financial information with the merchant; |
· | simplicity of the Company's fee structure; |
· | ability to develop services across multiple commerce channels, including mobile payments and payments at the retail point of sale; |
· | customer service; |
· | brand recognition; |
· | website, mobile platform and application onboarding, ease-of-use and accessibility; |
· | system reliability and data security; |
· | ease and quality of integration into third-party mobile applications; and |
· | quality of developer tools such as its application programming interfaces and software development kits. |
Number of shares sold | 25% | 50% | 75% | 100% | |||||||||
Gross proceeds from this Offering (1)(2) | $ | 750,000 | $ | 1,500,000 | $ | 2,250,000 | $ | 3,000,000 | |||||
Offering Costs | $ | 55,000 | $ | 55,000 | $ | 55,000 | $ | 55,000 | |||||
Net proceeds from this Offering | $ | 695,000 | $ | 1,445,000 | $ | 2,195,000 | $ | 2,945,000 | |||||
Operations | $ | 50,000 | (3) | $ | 100,000 | (4) | $ | 150,000 | $ | 200,000 | |||
Software/Platform Development | $ | 350,000 | (3) | $ | 700,000 | (4) | $ | 750,000 | $ | 800,000 | |||
Marketing & Advertising | $ | 45,000 | $ | 120,000 | $ | 670,000 | (5) | $ | 970,000 | ||||
Regulatory Matters (legal, and compliance) | $ | 150,000 | $ | 200,000 | (4) | $ | 250,000 | $ | 475,000 | ||||
Intellectual Property | $ | 12,500 | $ | 100,000 | (4) | $ | 37,500 | $ | 50,000 | ||||
General & Administrative | $ | 62,500 | $ | 125,000 | $ | 187,500 | $ | 250,000 | |||||
General Working Capital | $ | 25,000 | $ | 100,000 | $ | 150,000 | $ | 200,000 |
(1) | Expenditures for the 12 months following the completion of this offering. The expenditures are categorized by significant area of activity. The Company will hire more employees and consultants and scale up its operations based on the amount of funds it has. |
(2) | Due to the uncertainties inherent in software development it is difficult to estimate with certainty the exact amounts of the net proceeds from this offering that may be used for the above purposes. |
(3) | $400,000 for developers and programmers; and $150,000 for legal and compliance. |
(4) | $800,000 for developers and programmers; $200,000 for legal and compliance; $100,000 for intellectual property research and filings. |
(5) | The $10 sign-up discount and $3 initial transaction subsidy would be included as customer acquisition/marketing costs. When the customer signs up, he or she receives a $10 discount from Wigi on the first $50 funded by the customer. In addition, Wigi refunds to the merchant the first $3 of customer discounts, after which are funded by the restaurant (as at that point, it is management's belief that the customer will presumably become a repeat customer of the network because of the loyalty/rewards discounts associated with the Wigi platform). Wigi can give no assurance that all, or even a significant portion of these shares will be sold from this Offering, and that any moneys raised will be sufficient to execute the entire business plan of the Company. Assuming the completion of the WigiPay platform, the Company cannot begin commercial operations without sufficient capital for the subsidies. |
a. | Development of the WigiWallet/Application to hold and transfer the WigiPay points and manage balance, view history, and loyalty rewards. |
b. | Development of the Wigi account to be functional to facilitate the transfer of cash (fiat) to Wigi and to receive the WigiPay points to the WigiWallet/Application. |
c. | Development of the WigiPOS for merchants to be able to view customer payments, view dashboard of transaction history, and manage loyalty discounts. |
a. | Complete beta version of WigiPay platform (July 2018 to January 2019); |
b. | Testing and customer/merchant feedback and changes to the platform (February 2019 to May 2019); and |
c. | Commercial launch of WigiPay platform. |
Existing Shareholders if all Shares Sold | ||||
Price per share | $ | 1.00 | ||
Net tangible book value per share before offering | $ | 0.04 | ||
Potential gain to existing shareholders | $ | 0.24 | ||
Net tangible book value per share after offering | $ | 0.28 | ||
Increase to present shareholders in net tangible book value per share after offering | $ | 0.24 | ||
Capital contributions | $ | 501,552 | ||
Number of shares outstanding before the offering | 9,046,890 | |||
Number of shares after offering held by existing shareholders | 9,046,890 | |||
Percentage of ownership after offering | 75.1 |
Purchasers of Shares in this Offering if all Shares Sold | ||||
Price per share | $ | 1.00 | ||
Dilution per share | $ | 0.72 | ||
Capital contributions | $ | 3,000,000 | ||
Percentage of capital contributions | 85.7 | |||
Number of shares after offering held by public investors | 3,000,000 | |||
Percentage of ownership after offering | 24.9 |
Purchasers of Shares in this Offering if 75% of Shares Sold | ||||
Price per share | $ | 1.00 | ||
Dilution per share | $ | 0.77 | ||
Capital contributions | $ | 2,250,000 | ||
Percentage of capital contributions | 81.8 | |||
Number of shares after offering held by public investors | 2,250,000 | |||
Percentage of ownership after offering | 19.9 |
Purchasers of Shares in this Offering if 50% of Shares Sold | ||||
Price per share | $ | 1.00 | ||
Dilution per share | $ | 0.82 | ||
Capital contributions | $ | 1,500,000 | ||
Percentage of capital contributions | 74.9 | |||
Number of shares after offering held by public investors | 1,500,000 | |||
Percentage of ownership after offering | 14.2 |
Purchasers of Shares in this Offering if 25% of Shares Sold | ||||
Price per share | $ | 1.00 | ||
Dilution per share | $ | 0.89 | ||
Capital contributions | $ | 750,000 | ||
Percentage of capital contributions | 59.9 | |||
Number of shares after offering held by public investors | 750,000 | |||
Percentage of ownership after offering | 7.7 |
Name and position | Shares Beneficially Owned Prior to Offering | Shares Offered | Shares Beneficially Owned After Offering | Percentage Beneficially Owned1,2 | ||||
Private Investors: | ||||||||
Jazeb Jones | 400,000 | 400,000 | 0 | * | ||||
John Derby | 266,000 | 266,000 | 0 | * | ||||
Robert Tyler | 408,318 | 408,318 | 0 | * | ||||
Tania Woods | 420,818 | 420,818 | 0 | * | ||||
Nest Capital Management | 223,200 | 223,200 | 0 | * | ||||
Alan Lindsay | 1,155,636 | 1,155,636 | 0 | * | ||||
Forte Investment Group Inc. | 405,818 | 405,818 | 0 | * | ||||
Steve Eliscu | 400 | 400 | 0 | * | ||||
Eugene Filiatrault | 400 | 400 | 0 | * | ||||
Tyler Aono | 800 | 800 | 0 | * | ||||
Norio Aono | 800 | 800 | 0 | * | ||||
Ryuya Furukawa | 400 | 400 | 0 | * | ||||
Kento Hashi | 400 | 400 | 0 | * | ||||
Kanako Kikuchi | 400 | 400 | 0 | * | ||||
Shun Nakayama | 800 | 800 | 0 | * | ||||
Kumi Nishioka | 400 | 400 | 0 | * | ||||
Kairi Tsuji | 400 | 400 | 0 | * | ||||
Masayuki Suzuki | 400 | 400 | 0 | * | ||||
Colin Wilson | 40,000 | 40,000 | 0 | * | ||||
Richard Ellison | 20,000 | 20,000 | 0 | * | ||||
Justin Meyer | 3,000 | 3,000 | 0 | * | ||||
Janeen Al Jadir | 10,000 | 10,000 | 0 | * | ||||
William Robertson | 2,000 | 2,000 | 0 | * | ||||
Adam Lambert | 20,000 | 20,000 | 0 | * | ||||
Tracy Dow | 2,000 | 2,000 | 0 | * | ||||
Robert Salna | 50,000 | 50,000 | 0 | * |
Mohammad Shaygan | 100,000 | 100,000 | 0 | * | ||||
Jiang Yu | 100,000 | 100,000 | 0 | * | ||||
Randall Lanham | 1,000 | 1,000 | 0 | * | ||||
Chetwood Ulyatt Capital, Inc. | 1,000 | 1,000 | 0 | * | ||||
John Welles | 500 | 500 | 0 | * | ||||
Kristen Lanham | 500 | 500 | 0 | * | ||||
Stephen Lanham | 500 | 500 | 0 | * | ||||
Roger Janssen | 500 | 500 | 0 | * | ||||
Road Runner Media, Inc. | 500 | 500 | 0 | * | ||||
Joyce Lindsay | 6,000 | 6,000 | 0 | * | ||||
Noel Watkins | 4,000 | 4,000 | 0 | * | ||||
Total | 3,646,890 | 3,646,890 | 0 | 0% |
(1) | Based on 9,046,890 shares outstanding as of April 4, 2018. |
(2) | BENEFICIAL OWNERSHIP: Shares held include all shares beneficially owned by the respective selling stockholder. Pursuant to Rule 13d-3 under the Securities Exchange Act of 1934, involving the determination of beneficial owners of securities, a beneficial owner of securities is person who directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise has, or shares, voting power and/or investment power with respect to the securities, and any person who has the right to acquire beneficial ownership of the security within sixty days through means including the exercise of any option, warrant or conversion of a security. |
As of the date of this filing, there is no public market for our securities. There has been no public trading of our securities, and, therefore, no high and low bid pricing. As of the date of this prospectus, we have43shareholders of record.
• | 1% of the number of shares of common stock then outstanding, which will equal approximately 120,469 shares immediately after this offering; or |
• | the average weekly trading volume of the common stock during the four calendar weeks preceding the filing of a notice on Form 144 with respect to such sale. |
We were incorporated on August 10, 2017 in the State of Oklahoma. From inception until the date of this filing we have had limited operating activities, primarily consisting of (i) the incorporation of our company, (ii) the development of our business plan, (iii) the acquisition of the source code for the Wigi software platform, (iv)the initial equity funding, (v) the development of WigiPay through conceptually setting out the use of Wigi "Points" and how the overall platform will function.
Our financial statements from inception on August 10, 2017 through our fiscal period ended March 31, 2018 report no revenues and a net loss of $108,908. Our independent auditor has issued an audit opinion for our Company which includes a statement expressing substantial doubt as to our ability to continue as a going concern.
• | recognizes and understands the risks affecting the business as well as its legal and regulatory obligations; |
• | adopts robust mitigation and compliance policies and operating procedures; |
• | assesses risks, identifies threats, weaknesses and vulnerabilities, and responds appropriately; |
• | strictly complies with applicable laws, rules and regulations including those relating to relating to financial and payment services, anti-money laundering, countering terrorist financing, potentially exposed persons and financial sanctions; |
• | disrupts illegal activity by co-operating fully with the authorities and reporting suspicious activity; |
• | identifies initial and ongoing compliance training needs of its management, staff and contractors and |
• | ensures all are trained and achieve adequate levels of attainment; and |
• | continuously monitors and regularly reviews its compliance performance. |
· | paper-based transactions (principally cash and checks); |
· | providers of traditional payment methods, particularly credit and debit cards, money orders, and Automated Clearing House transactions (these providers are primarily well-established banks); |
· | providers of "digital wallets" which offer customers the ability to pay online and/or on mobile devices through a variety of payment methods, including with mobile applications, through contactless payments, and with a variety of payment methods; |
· | providers of mobile payments solutions that use tokenized card data approaches and Near Field Communication ("NFC") functionality (including Host Card Emulation ("HCE") functionality to eliminate the need for a physical NFC chip in the device); |
· | payment-card processors that offer their services to merchants; |
· | providers of "person-to-person" payments (typically through a trusted third party) that facilitate individuals sending money with an email address or mobile phone number; |
· | providers of mobile payments; and |
· | providers of card readers for mobile devices and of other new point of sale and multi-channel technologies. |
· | money remitters; |
· | services that provide online merchants the ability to offer their customers the option of paying for purchases from their bank account or paying on credit in the United States and abroad; |
· | issuers of stored value targeted at online payments; |
· | other international online payment-services providers; |
· | other providers of online account-based payments; |
· | payment services targeting users of social networks and online gaming, often through billing to the consumer's mobile phone account; |
· | mobile payment services between bank accounts; |
· | payment services enabling banks to offer their online banking customers the ability to send and receive payments through their bank account; |
· | online shopping services that provide special offers linked to a specific payment provider; and |
· | services that help merchants accept and manage virtual currencies. |
· | ability to attract, retain and engage both merchants and consumers with relatively low marketing expense; |
· | ability to show that merchants will achieve incremental sales by offering our services; |
· | security of transactions by utilizing the blockchain technology and networks; |
· | simplicity of our fee structure; and |
· | website, mobile platform and application onboarding, ease-of-use and accessibility. |
a. | Identifying "red flags" and upon identifying a "red flag", the Company is to use closer scrutiny to help determine whether the activity is suspicious or one for which there does not appear to be a reasonable business or legal purpose; and |
b. | Using counterparty KYC Questionnaire to gather information. |
Our business will be subject to extensive government regulation and oversight, as well as extensive, complex, overlapping and frequently changing rules, regulations and legal interpretations.
Our business will be subject to laws, rules, regulations, policies, and legal interpretations in the markets in which we operate, including, but not limited to, those governing payment services (including payment processing), consumer protection, anti-money laundering, and counter-terrorist financing. The legal and regulatory requirements applicable to us are extensive, complex, frequently changing, and increasing in number, and may impose overlapping and/or conflicting requirements or obligations. Financial and political events have increased the level of regulatory scrutiny on the payments industry, and regulatory agencies may view matters or interpret laws and regulations differently than they have in the past and in a manner adverse to our business.
Any failure or perceived failure to comply with existing or new laws, regulations or orders of any governmental authority (including changes to or expansion of the interpretation of those laws, regulations or orders), including those discussed in this risk factor, may subject us to significant fines, penalties, criminal and civil lawsuits, forfeiture of significant assets, and enforcement actions in one or more jurisdictions, result in additional compliance and licensure requirements, increase regulatory scrutiny of our business, restrict our operations, and force us to change our business practices, make product or operational changes or delay planned product launches or improvements. Any of the foregoing could, individually or in the aggregate, damage our brands and business, and adversely affect our results of operations and financial condition. The complexity of U.S. federal and state regulatory and enforcement regimes, coupled with the global scope of our operations and the evolving global regulatory environment, could result in a single event giving rise to a large number of overlapping investigations and legal and regulatory proceedings by multiple government authorities in different jurisdictions.
Violation of any present or future regulation could expose us to substantial liability, force us to change our business practices or force us to cease offering our current product. In the future, we might be subjected to:
• state or federal banking regulations;
• additional states' money transmitter regulations and federal money laundering regulations;
• international banking or financial services regulations or laws governing other regulated industries; or
• U.S. and international regulation of Internet transactions.
If we are found to be in violation of any current or future regulations, we could be:
• exposed to financial liability, including substantial fines which could be imposed on a per transaction basis and disgorgement of our profits;
• forced to change our business practices; or
• forced to cease doing business altogether or with the residents of one or more states or countries.
Payments Regulation
In the U.S., the US Financial Crimes Enforcement Network (“FinCEN”) regulates bill payers, money transmitters, check sellers, issuers of payment instruments or similar non-bank payment businesses, which we refer to collectively as “money services businesses.” We operate in an industry subject to government regulation. We will be required to be licensed by the federal and state governments and register federally with FinCEN prior to conducting business.
As a licensed money transmitter, the Company will be subject to restrictions with respect to the investment of customer funds, reporting requirements, bonding requirements and inspection by state regulatory agencies. Accordingly, if we violate these laws or regulations, we could be subject to liability and/or additional restrictions, forced to cease doing business with residents of certain states, forced to change our business practices or required to obtain additional licenses or regulatory approvals, which could impose substantial costs.
The current rules amended in 1999 by FinCEN revised the regulatory definitions of certain non-bank financial institutions for purposes of the Bank Secrecy Act (BSA) and grouped the definitions into a separate category of financial institution called “money services businesses” or “MSBs.” A business that meets one or more of the definitions of a type of MSB (as currently defined) is an MSB and must comply with BSA requirements applicable to it as an MSB, as a financial institution and as a specific type of MSB.
In an administrative ruling dated August 27, 2014, FinCEN set forth a four-part test to determine whether payment processing activities fit within a payment processor exemption to the money transmitter definition. In order for the payment processor exemption to apply, the processor:
1. must facilitate the purchase of goods or services or the payment of bills for goods or services (other than money transmission itself),
2. must operate through clearance and settlement systems that admit only BSA-regulated financial institutions,
3. must provide the service pursuant to a formal agreement, and
4. must have an agreement with the seller or creditor that provided the goods or services and receives the funds.
As the Company’s plans currently exist, we will be required to license as a money transmitter and therefore will be subject to extensive regulations. There can be no assurance that we will be able to obtain such licenses, and, even if we were able to do so, there could be substantial costs and potential product changes involved in maintaining such licenses, which could have a material and adverse effect on our business.
Name1 | Age | Positions and Offices | ||
Chris Filiatrault Robert Rosner Denis D. Corin | 56 53 45 | Chief Executive Officer and Director Chief Financial Officer and Director Director |
Annual Compensation | Long-Term Compensation Awards | ||||||||||||||
Name and Principal Position | Inception to September 30, 2017 | Salary ($)* | Bonus ($) | Other Annual Compensation ($) | Securities Underlying Options (#) | ||||||||||
Chris Filiatrault, Chief Executive Officer | $ | 0.00 | $ | 0.00 | $ | 0.00 | None | ||||||||
Robert Rosner, Chief Financial Officer and Director | $ | 0.00 | $ | 0.00 | $ | 0.00 | None | ||||||||
Denis D. Corin, Director | $ | 0.00 | $ | 0.00 | $ | 0.00 | None | ||||||||
Title of Class | Name and Address of | Number of Shares | Percent of |
Beneficial Owner | Owned Beneficially | Class Owned | |
Common Stock | Chris Filiatrault (1)(2) | 5,000,000 | 55.3% |
Common Stock | Robert Rosner (1) | 200,000 | 2.2% |
Common Stock | Denis D. Corin | 200,000 | 2.2% |
Common Stock | Digital Mint Group SEZC (1)(2) | 5,000,000 | 55.3% |
Common Stock | Alan Lindsay | 1,155,636 | 12.8% |
All Executive Officers | |||
and Directors as a | 5,400,000 | 59.7% | |
Group (3 persons) |
Pages | |
Report of Independent Registered Public Accounting Firm | F-1 |
Balance Sheet as of September 30, 2017 | F-2 |
Statement of Operations for the period from August 10, 2017 (inception) to September 30, 2017 | F-3 |
Statement of Stockholders' Equity for the period from August 10, 2017 (inception) to September 30, 2017 | F-4 |
Statement of Cash Flows for the period from August 10, 2017 (inception) to September 30, 2017 | F-5 |
Notes to the Financial Statements | F-6 to F-9 |
For the period ending June 30, 2018
Pages | |
Balance Sheet as of June 30, 2018 (Unaudited) and September 30, 2017 | F-10 |
Statement of Operations (Unaudited) for the Three and Nine Months Ended June 30, 2018 | F-11 |
Statement of Cash Flows (Unaudited) for the Nine Months Ended June 30, 2018 | F-12 |
Unaudited Notes to the Financial Statements | F-13 to F-16 |
As of September 30, 2017 | ||||
Assets | ||||
Current assets: | ||||
Cash and cash equivalents | $ | 401,314 | ||
Total current assets | 401,314 | |||
Total Assets | $ | 401,314 | ||
Liabilities and Stockholders' Equity | ||||
Current liabilities: | ||||
Accounts payable to related parties | $ | 20,000 | ||
Accounts payable and accrued liabilities | 27,688 | |||
Total current liabilities | 47,688 | |||
Total liabilities | 47,688 | |||
Preferred stock, $0.001 par value, 10,000,000 shares authorized, no shares issued and outstanding as of September 30, 2017 | - | |||
Common stock, $0.001 par value, 90,000,000 shares authorized, 9,046,890 shares issued and outstanding as of September 30, 2017 | 9,047 | |||
Additional paid-in capital | 492,246 | |||
Stock subscription receivable | (99,812 | ) | ||
Accumulated deficit | (47,855 | ) | ||
Total stockholders' equity | 353,626 | |||
Total Liabilities and Stockholders' Equity | $ | 401,314 |
For the period from August 10, 2017 (inception) to September 30, 2017 | ||||
Revenue | $ | - | ||
Expenses: | ||||
General and administrative expenses | 167 | |||
Legal and professional expenses | 27,188 | |||
Website | 500 | |||
Software and source code – related party | 20,000 | |||
Total expenses | 47,855 | |||
Net loss | $ | (47,855 | ) | |
Net loss per share – basic and diluted | $ | (0.01 | ) | |
Basic and diluted weighted average shares outstanding | 4,523,445 | |||
Common Stock | ||||||||||||||||||||||||
Shares | Amount | Paid-in Capital | Stock Subscription Receivable | Accumulated Deficit | Total Stockholders' Equity | |||||||||||||||||||
Balance – August 10, 2017 (Inception) | - | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||||
Common stock issued for cash | 9,046,890 | 9,047 | 492,246 | - | - | 501,293 | ||||||||||||||||||
Stock subscription receivable | - | - | - | (99,812 | ) | - | (99,812 | ) | ||||||||||||||||
Net loss | - | - | - | (47,855 | ) | (47,855 | ) | |||||||||||||||||
Balance – September 30, 2017 | 9,046,890 | $ | 9,047 | $ | 492,246 | $ | (99,812 | ) | $ | (47,855 | ) | $ | 353,626 |
For the period from August 10, 2017 (inception) to September 30, 2017 | ||||
Cash flows from operating activities | ||||
Net loss | $ | (47,855 | ) | |
Changes in operating assets and liabilities | ||||
Accounts payable to related parties | 20,000 | |||
Accounts payable and accrued liabilities | 27,688 | |||
Net cash used in by operating activities | (167 | ) | ||
Cash flows used in financing activities | ||||
Issuance of common stock for cash | 401,481 | |||
Net cash provided by financing activities | 401,481 | |||
Net increase in cash | 401,314 | |||
Cash, beginning of period | - | |||
Cash, end of period | $ | 401,314 | ||
Supplemental disclosure of cash flow information | ||||
Cash paid during the year for: | ||||
Interest | $ | - | ||
Income taxes | $ | - | ||
Refer to Note 2 in the financial statements for disclosures over all non-cash investing and financing activities during the period. | ||||
Wigi Blockchain Technologies, Inc.
June 30, 2018 | September 30, 2017 | |||||||
(Unaudited) | ||||||||
Assets | ||||||||
Current assets: | ||||||||
Cash | $ | 402,569 | $ | 401,314 | ||||
Total current assets | 402,569 | 401,314 | ||||||
Total Assets | $ | 402,578 | $ | 401,314 | ||||
Liabilities and Stockholders’ Equity | ||||||||
Current liabilities: | ||||||||
Accounts payable to related parties | $ | 20,000 | $ | 20,000 | ||||
Accounts payable and accrued liabilities | 750 | 27,688 | ||||||
Total current liabilities | 20,750 | 47,688 | ||||||
Total liabilities | 20,750 | 47,688 | ||||||
Preferred stock, $0.001 par value, 10,000,000 shares authorized, no shares issued and outstanding as of June 30, 2018 and September 30, 2017 | — | — | ||||||
Common stock, $0.001 par value, 90,000,000 shares authorized, 9,046,890 shares issued and outstanding as of June 30, 2018 and September 30, 2017 | 9,047 | 9,047 | ||||||
Additional paid-in capital | 492,246 | 492,246 | ||||||
Stock subscription receivable | — | (99,812 | ) | |||||
Accumulated deficit | (119,474 | ) | (47,855 | ) | ||||
Total stockholders’ equity | 381,819 | 353,626 | ||||||
Total Liabilities and Stockholders’ Equity | $ | 402,569 | $ | 401,314 | ||||
For the three months ended June 30, 2018 | For the nine months ended June 31, 2018 | |||||||
Revenue | $ | — | $ | — | ||||
Expenses: | ||||||||
General and administrative expenses | 2,775 | 3,718 | ||||||
Legal and professional expenses | 3,780 | 23,642 | ||||||
Consulting fees | 4,000 | 39,000 | ||||||
Consulting fees – related party | — | 5,000 | ||||||
Total expenses | 10,305 | 71,360 | ||||||
Net loss | $ | (10,305 | ) | $ | (71,360 | ) | ||
Net loss per share – basic and diluted | $ | (0.00 | ) | $ | (0.01 | ) | ||
Basic and diluted weighted average shares outstanding | 9,046,890 | 9,046,890 |
For the nine months ended September 30, 2018 | ||||
Cash flows from operating activities | ||||
Net loss | $ | (71,618 | ) | |
Changes in operating assets and liabilities | ||||
Accounts payable and accrued liabilities | (26,938 | ) | ||
Net cash used in operating activities | (98,556 | ) | ||
Cash flows used in financing activities | ||||
Issuance of common stock for cash | 99,812 | |||
Net cash provided by financing activities | 99,812 | |||
Net increase in cash | 1,264 | |||
Cash, beginning of period | 401,314 | |||
Cash, end of period | $ | 402,570 | ||
Supplemental disclosure of cash flow information: | ||||
Cash paid during the period for: | ||||
Interest | $ | — | ||
Income taxes | $ | — |
Wigi Blockchain Technologies, Inc.
Wigi Blockchain Technologies, Inc., (the “Company”) an Oklahoma corporation incorporated on August 10, 2017, is a payments technology company that is developing a payments platform known as “WigiPay.” The Company intends to develop a blockchain payments platform using fiat currency as opposed to the many other cryptocurrencies. In order to do that, the Company intends to implement WigiPay points which will allow payments to be made using blockchain technology. Each WigiPay point will represent one (1) fiat currency in the local currency. For example, in the United States, one (1) WigiPay point will represent one (1) U.S. dollar. Wigi is intended to give retail and e-commerce the ability to lower the cost of payments, eliminate fraud and deliver an automated and integrated rewards system. WigiPay is intended to be a consumer-focused payment platform that when fully developed will provide consumers with multiple payment options. In addition, we intend to provide retail and e-commerce businesses the ability to accept payments utilizing WigiPay points via our WigiPay payments system, which will charge a fee on every transaction made through our application. This is intended to provide a larger customer base to businesses while also lowering the payment processor transaction costs. The Company believes that through the Wigi platform consumers, merchants and merchant network platform providers, can simultaneously benefit with its WigiPay payment system, which will use blockchain technology. The Company believes it can disrupt legacy payments industry systems, which are costly for merchants (and ultimately for consumers), especially when fraud and chargebacks are included. Our products will include the WigiPay mobile app for consumers and WigiPOS merchant dashboard. When used together, consumers will be able to pay for products and services at lower costs while merchants will benefit from an automated rewards system that result in greater consumer retention and satisfaction. Wigi intends to modernize legacy payments by utilizing blockchain technology with fiat currency.
The Company is a development stage company that has not realized any revenues to date and are in the early stages of developing the business. The Company is an “emerging growth company” within the meaning of the federal securities laws and intends to take advantage of reporting exemptions offered to “emerging growth companies” until the Company is no longer an “emerging growth company”.
The financial statements present the balance sheets, statement of operations, cash flows of the Company. These financial statements are presented in United States dollars and have been prepared in accordance with U.S. generally accepted accounting principles.
..Wigi Blockchain Technologies, Inc.
The Company maintains a cash balance in a non-interest-bearing account. The Company considers short-term, highly liquid investments that are readily convertible to known amounts of cash and that are so near their maturity that they present insignificant risk of changes in value because of changes in interest rate to be cash equivalents. This balance includes $78,190 ($181,060 at September 30, 2017) held in a trust account that is legal title of the Company. There were no cash equivalents as of June 30, 2018 (none held as of September 30, 2017).
The Company applies a more-likely-than-not recognition threshold for all tax uncertainties. As of June 30, 2018, the Company reviewed its tax positions and determined there were no outstanding tax positions with less than a 50% likelihood of being sustained upon examination by the taxing authorities, therefore this standard has not had a material effect on the Company.
This balance relates to capital stock issued during the period from August 10, 2017 to September 30, 2017, for which payment has not been received by the Company at year end. The balance receivable was collected in full by December 7, 2017.
Basic loss per share includes no dilution and is computed by dividing loss available to common stockholders by the weighted average number of common shares outstanding for the period. Dilutive loss per share reflects the potential dilution of securities that could share in the losses of the Company. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive.
As of June 30, 2018 there were no warrants, options or agreements outstanding to acquire additional shares of stock that would have a dilutive effect on current shares outstanding, as such diluted and basic EPS are equivalent at period end.
Commitments and Contingencies
Management of the Company is not aware any commitments or contingencies that would have a material adverse effect on the Company’s financial condition, results of operations or cash flows.
Foreign Currency translation
The Company’s functional and reporting currency is the US dollar. Foreign exchange items are translated to US dollars using the exchange rate prevailing at the balance sheet date. Monetary assets and liabilities are translated using the exchange rate at the balance sheet date. Non-monetary assets and liabilities are translated at historical rates. Revenues and expenses are translated at average rates for the period. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income.
Recent Accounting Pronouncements
The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.
3. Going Concern
The Company’s financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern. The Company had an accumulated deficit of $119,474 as of June 30, 2018 ($47,855 as of September 30, 2017). The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.
In order to continue as a going concern, the Company will need, among other things, additional capital resources. The Company is dependent upon its ability, and will continue to attempt, to secure equity and/or debt financing. There are no assurances that the Company will be successful and without sufficient financing it would be unlikely for the Company to continue as a going concern.
The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern. These financial statements do not include any adjustments relating to the recoverability and classification of recorded asset amounts, or amounts and classification of liabilities that might result from this uncertainty.
Effective August 10, 2017, 1,000,000 shares of common stock were offered and sold to three investors at a purchase price of $0.0025 per share.
Effective August 15, 2017, 5,000,000 shares of common stock were offered and sold to Digital Mint Group SEZC, a company owned and controlled by Chris Filiatrault, a director of the Company, at a purchase price of $0.01 per share. These shares are restricted from trading for a period of 12 months subsequent to listing on the OTCQB Market. Subsequent to this 12 month period shares are able to be traded with additional provisions on the trades up until August 10, 2019.
Effective August 15, 2017, 400,000 shares of common stock were offered and sold to Denis Corin and Robert Rosner, directors of the Company, at a purchase price of $0.01 per share. The shares are restricted for trading for one year pursuant to SEC rule 144.
Effective August 31, 2017, 2,252,290 shares of common stock were offered and sold to six investors at a purchase price of $0.11 per share.
Effective September 30, 2017, 394,600 shares of common stock were offered and sold to thirty-four investors at a purchase price of $0.50 per share.
5. | Related Party Transactions |
The Company engaged Christopher Filiatrault (CEO and Director) for software consulting services delivered during the first quarter of the fiscal year at a total cost of $5,000. No related party transactions were noted from the period of March 31, 2018 to June 30, 2018.
6. | Subsequent Events |
The Company’s Management has reviewed all material events through the date of this report and there are no additional material subsequent events to report that have not already been disclosed within the aforementioned notes.
Amount | ||||
Item | (US$) | |||
SEC Registration Fee | $ | 600.52 | ||
Transfer Agent Fees | 1,000.00 | |||
Legal Fees | 40,000.00 | |||
Accounting and Auditing Fees | 20,000.00 | |||
Printing/Edgar filing Costs | 500.00 | |||
Miscellaneous | 2,899.48 | |||
TOTAL | $ | 65,000.00 |
· | indemnify officers and directors against certain liabilities that may arise because of their status as officers or directors; |
· | advance expenses, as incurred, to officers and directors in connection with a legal proceeding, subject to limited exceptions; or |
· | obtain directors' and officers' insurance. |
Exhibit | Description | |
Wigi Blockchain Technologies, Inc. (Registrant) | |||
By: | /s/ Chris Filiatrault | ||
Name: Chris Filiatrault | |||
Title: Chief Executive Officer, President and Director | |||
(principal exertive officer) | |||
By: | /s/ Robert Rosner | ||
Name: Robert Rosner | |||
Title: Chief Financial Officer and Director | |||
(principal principal financial officer, and principal accounting officer) | |||
By: | /s/ Dennis D. Corin | ||
Name: Dennis D. Corin | |||
Title: Director |